Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-02-02126/USCOURTS-ca10-02-02126-0/pdf.json

Parties Involved:
City of Albuquerque
Appellee
Marcel Wisznia
Appellant
Walter Wisznia
Not Party

Document Text:

UNITED STATES COURT OF APPEALS 

TENTH CIRCUIT 

MARCEL WISZNIA, individually and as 

Executor of the Estate of Walter Wisznia, 

d/b/a WISZNIA ASSOCIATES, 

Plaintiff-Appellant, 

FILED 

United States Court of Appeals 

Tenth Circuit 

June 15, 2005 

PATRICK FISHER 

Clerk 

V. No. 02-2126 

CITY OF ALBUQUERQUE, 

Defendant-Appellee. 

(D.C. No. CIV-00-l 184LH/WWD) 

(D.N.M.) 

ORDER AND JUDGMENT* 

Before BRISCOE, MURPHY and McKAY, Circuit Judges. 

Plaintiff Marcel Wisznia appeals from the district court's grant of summary 

judgment in favor of defendant, the City of Albuquerque, on res judicata grounds. We 

exercise jurisdiction pursuant to 28 U.S.C. § 1291 and reverse and remand for further 

proceedings. 

*This order and judgment is not binding precedent, except under the doctrines of 

law of the case, res judicata, and collateral estoppel. The court generally disfavors the 

citation of orders and judgments; nevertheless, an order and judgment may be cited under 

the terms and conditions of 10th Cir. R. 36.3. 

Appellate Case: 02-2126 Document: 010110758001 Date Filed: 06/15/2005 Page: 1
I. 

In late 1998 or early 1999, the New Mexico Department of Corrections (DOC) 

sought bids for the construction and lease of a probation and parole office in the City of 

Albuquerque (the City). Marcel Wisznia and Walter Wisznia, doing business as Wisznia 

Associates, submitted a bid to the DOC proposing to build a 23,300 square-foot building 

located on a 2.34 acre site in the Yale Business Park in the City. The DOC ultimately 

awarded the bid to the Wisznias and, on May 18, 1999, entered into a lease with the 

Wisznias for the proposed building. In pertinent part, the lease required the building to be 

completed and ready for occupancy by April 1, 2000. 

On May 28, 1999, the Wisznias submitted to the City a site plan for the proposed 

building, as was necessary to obtain a building permit. At the time of the submission, the 

site was allegedly zoned for "office and institution," "community commercial," and 

"industrial park" uses. Aplt. App. at 16. Following the Wisznias' submission, the staff of 

the City's Planning Department recommended approval of the site plan, subject to certain 

design changes that were acceptable to the Wisznias. In light of this recommendation, the 

Wisznias proceeded to purchase, for approximately $375,000.00, the site intended for the 

proposed building. The Wisznias also allegedly "expended substantial amounts in 

planning and architectural fees." Id. at 17. 

On July 15, 1999, the Wisznias' proposed site plan came before the City's 

Environment Planning Commission (EPC) for the first time. During that hearing, none of 

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the EPC's members questioned whether the site was properly zoned for the proposed use, 

and one member expressly noted that the site was properly zoned. However, the EPC 

"expressed concern about the layout of the site plan, the building design and the use of 

chain link fencing with barb wire strands." Id. at 45. Accordingly, the EPC voted to defer 

a decision on the Wisznias' request until its next scheduled meeting on August 26, 1999. 

At the August 26, 1999, meeting, the EPC again voted to defer a decision on the Wisznias' 

proposed site plan until September 9, 1999. 

On September 8, 1999, the Victory Hills Neighborhood Association, which 

represented the residential neighborhood closest to the site, held a meeting during which 

two New Mexico state representatives allegedly appeared and spoke in opposition to the 

proposed probation and parole office. One of those state representatives also allegedly 

contacted members of the EPC regarding the proposed office. 

On September 9, 1999, the chairman of the EPC was allegedly contacted by two 

sources. First, Albuquerque Mayor Jim Baca allegedly sent a letter to the chairman asking 

that the meeting scheduled for that day be deferred. Second, United States Senator 

Heather Wilson allegedly contacted the chairman and expressed concerns from a 

constituent regarding the proposed probation and parole office. According to the 

Wisznias, both of these communications were received by the chairman in violation of the 

EPC's rules. 

Although the EPC conducted its scheduled meeting on September 9, 1999, it took 

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no action on the Wisznias' proposed site plan and instead deferred that matter until 

October 21, 1999. Subsequently, on October 1, 1999, the Wisznias, through their counsel, 

sent a letter to the City asking if the issue of zoning for the proposed probation and parole 

office would be an issue at the EPC's October 21, 1999 hearing. On October 6, 1999, the 

City's Zoning Enforcement Manager (ZEA) sent a letter directly to the Wisznias advising 

them "that the proposed building could only be built on a site zoned SU-1 for specific use 

as a 'correctional or disciplinary institution."' Id. at 20. Although the Wisznias, through 

counsel, asked the ZEA to reconsider his position on this matter, he never responded to 

their request. 

On October 21, 1999, the EPC conducted its planned meeting and rejected the 

Wisznia's proposed site plan. In doing so, the EPC relied upon the ZEM's October 6, 

1999 letter. The Wisznias appealed the EPC' s decision to the City Council's Land Use, 

Planning and Zoning Committee (LUPZC), which, after a public hearing, upheld the 

EPC's decision and voted that the appeal should not be heard by the full City Council. On 

December 17, 1999, the City Council adopted the LUPZC's recommendation and 

summarily denied the Wisznias' request. 

On January 18, 2000, the Wisznias appealed the City Council's December 17, 1999, 

decision to the Second Judicial District Court in Bernalillo County, New Mexico. In that 

administrative appeal, the Wisznias asserted four issues: (1) whether the City zoning 

authorities misinterpreted and misapplied the zoning ordinances in denying the Wisznias' 

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proposed site plan; (2) whether there was substantial evidence to support the findings on 

which the City zoning authorities relied in denying the proposed site plan; (3) whether the 

City's decision was an impermissible attempt to set public policy, instead of following the 

policy already in place under the City's zoning code; and (4) whether the City's decision 

was arbitrary, capricious and a manifest abuse of discretion. 

On February 21, 2000, approximately one month after the Wisznias filed their 

administrative appeal, the DOC terminated its lease agreement with the Wisznias due to 

the Wisznias' inability to build the proposed probation and parole office and perform its 

lease obligations by the required occupancy date. To mitigate their damages, the Wisznias 

allegedly sold the proposed site to a nonprofit corporation at a loss. 

On July 7, 2000, the Wisznias filed this civil action against the City in state district 

court, asserting claims for "deprivation of its civil rights under 42 U.S.C. § 1983, as well 

as inverse condemnation for the temporary and permanent takings of its property." Id. at 

170; see id. at 15. On August 15, 2000, the Wisznias moved to consolidate this action 

with the pending administrative appeal. However, one day later, on August 16, 2000, the 

City removed this action to federal district court. The City subsequently filed an answer to 

the Wisznias' complaint. Notably, the City's answer made no mention of, or objection to, 

the fact that the Wisznias were pursuing a related administrative appeal. Instead, the 

City's answer asserted, in pertinent part, that the Wisznias' "claims for constitutional 

violations [ we ]re barred because [ the Wisznias] ha[ d] failed to exhaust their administrative 

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remedies and State Court right to appeal." Id. at 69. 

On October 27, 2000, the Wisznias moved to dismiss their administrative appeal 

without prejudice, or alternatively, to supplement the record on appeal. In their motion, 

the Wisznias argued, in part, that their sale of the site had rendered their administrative 

appeal moot. The Wisznias also argued that the City's removal of their civil action was 

forcing them "to litigate the legality of the City's action in two separate forums." Id. at 

182. Thus, the Wisznias asked the state district court to dismiss the administrative appeal 

without prejudice "to [their] rights to pursue [their] common law remedies in the suit ... 

pending in federal court .... " Id. at 183. On March 14, 2001, the state district court 

issued a written order granting the Wisznias' motion to dismiss. In doing so, however, the 

state district court ordered the administrative appeal "dismissed with prejudice." Id. at 

177. 

On June 1, 2001, the City moved for summary judgment in this federal civil action 

on the basis of claim preclusion. In their response to the City's summary judgment 

motion, the Wisznias argued, in part, that the City had waived the defense of claim 

preclusion by failing to affirmatively plead the defense in its answer, and that, in any 

event, there was no merit to the claim preclusion defense. On July 3, 2001, the City 

moved to amend its answer to add the affirmative defense of claim preclusion. 

The district court subsequently granted both the City's motion to amend and its 

motion for summary judgment. In doing so, the district court concluded, in pertinent part, 

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that both the civil action and the administrative appeal "ar[ o ]se from the same 

transaction," i.e., "the City's denial of the[] [Wisznias'] zoning permit application," and 

thus "the allegations in" the civil lawsuit were "part of the claims the Wisznias asserted 

in" the administrative appeal. Id. at 314. The district court further noted that the state 

district court, in dismissing the administrative appeal, advised the Wisznias that it was 

dismissing their appeal with prejudice and that they "should [thus] proceed to appellate 

relief immediately."' Id. at 315 ( quoting letter from state district court to Wisznias ). 

Finally, the district court concluded that the state district court "had jurisdiction to 

consider" the Wisznias' civil claims, including their § 1983 claims, in the context of the 

administrative appeal. Id. at 316. 

Plaintiff Marcel Wisznia, appearing individually and as executor of the Estate of 

Walter Wisznia, now appeals. 

II. 

Wisznia asserts two general issues on appeal. First, he contends the district court 

erred in allowing the City to amend or supplement its answer to include the affirmative 

defense of claim preclusion. Second, Wisznia contends that even if the district court did 

not err in allowing the City to supplement its answer to include the res judicata defense, 

the district court nevertheless erred in granting summary judgment in favor of the City on 

that defense. Addressing these issues in reverse order, we conclude, for two separate 

reasons outlined below, that the doctrine of claim preclusion does not prevent Wisznia 

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from pursuing this civil action against the City, and that the district court erred in 

concluding otherwise. Thus, we find it unnecessary to determine whether the district court 

erred in allowing the City to amend or supplement its answer. 

Standard of review 

We review de novo a district court's grant or denial of summary judgment, applying 

the same standard as the district court. See Alexander v. Oklahoma, 382 F.3d 1206, 1215 

(10th Cir. 2004). Summary judgment is appropriate "if the pleadings, depositions, answers 

to interrogatories, and admissions on file, together with the affidavits, if any, show that 

there is no genuine issue as to any material fact and that the moving party is entitled to a 

judgment as a matter of law." Fed.R.Civ.P. 56(c). "We view the evidence, and draw 

reasonable inferences therefrom, in the light most favorable to the nonmoving party." 

Combs v. Price\Vaterhouse Coopers LLP, 382 F.3d 1196, 1199 (10th Cir. 2004). 

Because this is a diversity action, we must apply the substantive law of the forum 

state, i.e., New Mexico, as promulgated by that state's highest court. See Cooper v. Cent. 

& Southwest Servs., 271 F.3d 1247, 1251 (10th Cir. 2001). In the absence of a decision 

by the forum state's highest court, we must predict how that court would rule if faced with 

the issue. See Vanover v. Cook, 260 F.3d 1182, 1186 (10th Cir. 2001). In doing so, we 

review de novo the district court's interpretation of applicable state law. Quaker State 

Minit-Lube, Inc. v. Fireman's Fund Ins. Co., 52 F.3d 1522, 1527 (10th Cir. 1995). 

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Res judicata 

"Under the doctrine of res judicata," as recognized under New Mexico law, "a 

judgment on the merits in a prior lawsuit bars a subsequent action involving the same 

parties and the same cause of action." Kepler v. Slade, 896 P.2d 482, 484 (N.M. 1995). 

"For res judicata to apply" under New Mexico law, "the first and second lawsuits must be 

identical in four ways: ' ( 1) parties or privies, (2) capacity or character of persons for or 

against whom the claim is made, (3) cause of action, and (4) subject matter." Id. (quoting 

Silva v. State, 745 P.2d 380, 382 (N.M. 1987)). The parties in the lawsuits must also have 

had a "full and fair opportunity to litigate all issues arising out ofth[e] claim." W.G. 

Myers v. Olson, 676 P.2d 822, 824 (N.M. 1984). 

a) Waiver of defense by the City 

Wisznia asserts that the City, by removing the civil action to federal court, 

effectively agreed to have the civil claims litigated separately from the administrative 

appeal, and thus waived any res judicata defense it may have had. We agree. 

In applying the doctrine of claim preclusion, the New Mexico courts generally 

adhere to the principles of law outlined in the Restatement (Second) of Judgments. E.z,., 

Apodaca v. AAA Gas Co., 73 P.3d 215,240 (N.M. Ct. App. 2003). According to the 

Restatement, "[a] valid and final personal judgment rendered in favor of the defendant 

bars another action by the plaintiff on the same claim." Restatement (Second) of 

Judgments§ 19. This general rule does not apply, however, if"[t]he parties have agreed 

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in terms or in effect that the plaintiff may split his claim, or the defendant has acquiesced 

therein .... " Restatement (Second) of Judgments§ 26(l)(a). More specifically, 

[ w ]here the plaintiff is simultaneously maintaining separate actions based 

upon parts of the same claim, and in neither action does the defendant make 

the objection that another action is pending based on the same claim, 

judgment in one of the actions does not preclude the plaintiff from 

proceeding and obtaining judgment in the other action. The failure of the 

defendant to object to the splitting of the plaintiffs claim is effective as an 

acquiescence in the splitting of the claim. 

Id., Comment a. Notably, the Restatement provides an illustration of how such 

acquiescence might occur: 

After a collision in which A suffers personal injuries and property damage, 

A commences in the same jurisdiction one action for his personal injuries 

and another for the property damage against B. B does not make known in 

either action his objection (usually called "other action pending") to A's 

maintaining two actions on parts of the same claim. After judgment for A 

for the personal injuries, B requests dismissal of the action for property 

damage on the ground of merger. Dismissal should be refused as B 

consented in effect to the splitting of the claim. 

Id., Comment a., Illustration 1. 

Applying those principles here, it is apparent that the City acquiesced in the 

splitting of Wisznia' s claims. After Wisznia filed this civil action in state district court, he 

filed a motion asking the state district court to consolidate it with his pending 

administrative appeal. Before the state district court could rule on Wisznia's motion to 

consolidate, the City removed this civil action to federal district court. 1 After doing so, the 

1 The City argues its counsel was unaware of Wisznia's motion to consolidate 

when he filed the notice of removal. Whether counsel was aware of the motion or not, 

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City filed an answer but made no objection therein that Wisznia was splitting his claims. 

Likewise, there is no indication that the City objected in the administrative appeal to 

Wisznia maintaining two actions on parts of the same claim. Indeed, only after the state 

district court dismissed the administrative appeal did the City then seek to amend or 

supplement its answer in this civil action to plead the defense of res judicata. In sum, the 

City, through its actions, effectively waived any res judicata defense it may have had. 

Ji&, Klipsch, Inc. v. WWR Tech., Inc., 127 F.3d 729, 734-35 (8th Cir. 1997) (concluding, 

in diversity case subject to Indiana state law, that district court erred in granting summary 

judgment in favor of defendant on res judicata defense because defendant had acquiesced 

in the splitting of plaintiffs claims); Clements v. Airport Auth. of Washoe County, 69 

F.3d 321,328 (9th Cir. 1995) (concluding that defendant waived resjudicata defense by 

acquiescing in the splitting of plaintiffs claims); Calderon Rosado v. General Elec. Circuit 

Breakers, Inc., 805 F.2d 1085, 1087 (1st Cir.1986) (refusing to apply claim preclusion 

because defendant acquiesced to splitting of claim when he failed to object or complain 

while the two actions were pending); see generally Xorbox v. Naturita Supply Co., 681 

P .2d 1114, 1117 (N .M. 1984) (holding that defense of res judicata can, as a result of a 

defendant's actions or inactions, be waived under New Mexico law). 

counsel was aware that Wisznia had filed both an administrative appeal and a civil action 

in state district court, and by the City's removal of one action it effectively acquiesced in 

the splitting of Wisznia's claims. 

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b) Was there ajinal decision on the merits? 

Even assuming, for purposes of argument, that the City did not waive its res 

judicata defense, we agree with Wisznia that there is no merit to the defense because the 

state district court's dismissal of his administrative appeal was not a final decision on the 

merits. 

Generally speaking, the New Mexico courts have held "that a dismissal with 

prejudice is an adjudication on the merits for purposes of res judicata." Hope Comm. 

Ditch Ass'n v. New Mexico State Engineer, 105 P.3d 314, 317 (N.M. Ct. App. 2004). 

However, a dismissal for lack of standing is not considered to be on the merits, even if the 

order of dismissal nominally states otherwise. See id. The same appears to hold true for 

dismissals based on mootness. Although the New Mexico courts have never directly 

addressed the question, it is well-established in other jurisdictions that a dismissal on the 

grounds of mootness effectively indicates that the ruling court lacked jurisdiction over the 

matter, and thus the dismissal does not operate as a ruling on the merits of the action, even 

if the ruling nominally indicates otherwise. See Florida Public Interest Research Group 

Citizen Lobby, Inc. v. EPA, 386 F.3d 1070, 1086 (11th Cir. 2004) (holding that "mootness 

is jurisdictional" and that "[ a ]ny decision on the merits of a moot case would be an 

impcnnissible advisory opinion") (internal quotations omitted); Dahlem by Dahlem v. 

Board of Educ. of Denver Public Schools, 901 F.2d 1508, 1513 n.6 (10th Cir. 1990) ("The 

distinction between a dismissal for mootness and one on the merits is significant."); Pujol 

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v. Shearson/American Express, Inc., 829 F.2d 1201, 1209 n. 3 (1st Cir. 1987) (rejecting 

appellees' contention concerning the res judicata effect of a dismissed action in Puerto 

Rico Superior Court because that action "was dismissed as moot and accordingly has no 

res judicata effect"); District of Columbia Hosp. Ass 'n v. District of Columbia, 73 

F.Supp.2d 8, 12 (D.D.C. 1999) (stating that where a previous suit was dismissed as moot, 

a subsequent suit is not barred by res judicata since the merits of the claims were never 

tested.); Cannon v. Durham Co. Bd. of Elections, 959 F.Supp. 289,294 (E.D.N.C. 1997) 

(holding that, under North Carolina law, "a dismissal for mootness is simply a type of 

dismissal based on lack of jurisdiction" and accordingly does not operate as a "judgment 

on the merits" for res judicata purposes); Anast v. Commonwealth Apts., 956 F .Supp. 792, 

797 (N.D. Ill. 1997) (noting that, under Illinois law, "a cause deemed moot will not be res 

judicata, since there is no judgment on the merits"); Fabrizio v. U.S. Suzuki Motor Corp., 

289 N.E.2d 897, 898 (Mass. 1972) ("a dismissal based on mootness is not a decision on 

the merits"); Farkas v. New York State Dept. of Civil Serv., 494 N.Y.S.2d 178, 180 (N.Y. 

App. Div. 1985) ("we conclude that the dismissal of the prior proceeding herein as moot 

was not a final determination on the merits and, therefore, should not be accorded res 

judicata effect beyond the question decided therein."); see also Restatement (Second) of 

Judgments § 20( 1 )(a) ("A personal judgment for the defendant, although valid and final, 

does not bar another action by the plaintiff on the same claim ... [ w ]hen the judgment is 

one of dismissal for lack of jurisdiction .... "). In light of this authority, we predict that 

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the New Mexico Supreme Court, if faced with the issue, would agree that a dismissal 

based on mootness does not constitute a judgment on the merits for res judicata purposes. 

In tum, we reject the district court's conclusion that a judgment on the merits was 

rendered in Wisznia's administrative appeal. In his administrative appeal, Wisznia asked 

the state district court to "reverse the City's ruling" rejecting his proposed site plan. App. 

at 139 (statement of issues in administrative appeal). In other words, Wisznia effectively 

asked the state district court to issue an order approving of his proposed site plan, so that 

he could obtain a building permit to complete the proposed probation and parole office. 

Before the administrative appeal could be resolved, however, the DOC terminated its lease 

with Wisznia, and Wisznia in tum sold the subject property in an attempt to cut his 

monetary losses. Following these events, Wisznia then moved to dismiss the 

administrative appeal without prejudice on the grounds that the sale of the property had 

rendered the appeal moot. The state district court purported to grant Wisznia's motion, but 

stated in its one-page ruling that the dismissal was "with prejudice." App. at 177; see also 

id. at 228 (letter from state district court to Wisznia' s counsel noting that it "intend[ ed] to 

sign an Order dismissing with prejudice and therefore [he] should proceed to appellate 

relief immediately."). Notwithstanding the language used by the state district court in its 

order of dismissal, our review of the record clearly establishes that the basis for the state 

district court's order was mootness.2 Id. at 220 (in its reply in support of its motion for 

2 In its order granting summary judgment in favor of the City, the district court 

concluded that the state district court "considered and decided the issues raised in the 

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summary judgment, the City admitted the administrative appeal was dismissed for 

mootness). Accordingly, even though the state district court nominally dismissed 

Wisznia's administrative appeal "with prejudice," that order of dismissal, based as it was 

on the grounds of mootness, does not constitute a judgment on the merits for res judicata 

purposes. Thus, contrary to the conclusion reached by the district court, we conclude that 

the state district court's decision has no preclusive effect for purposes of this federal civil 

action. 3 

We REVERSE the district court's grant of summary judgment and REMAND for 

further proceedings. 

Judge Murphy concurs in Parts I and II(b ), as well as in the judgment. 

Entered for the Court 

Mary Beck Briscoe 

Circuit Judge 

Wisznias' statement of issues [in their administrative appeal] which included: (I) whether 

the City misinterpreted the zoning ordinances; (2) whether there was substantial evidence 

to support the findings of the City; and (3) whether the City's decision was an 

impermissible attempt to set policy and whether its decision was arbitrary, capricious and 

a manifest abuse of discretion." App. at 315. We disagree. As noted, the state district 

court's order of dismissal was one-page long, and simply stated that it was granting 

Wisznia's motion to dismiss. Further, a review of Wisznia's motion indicates that it was 

based primarily on the ground of mootness. 

3 We accordingly find it unnecessary to address Wisznia's assertions that (a) he did 

not have a full and fair opportunity to litigate his civil claims in the context of the 

administrative appeal, or (b) that the causes of action in the two lawsuits were not the 

same. 

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