#### Marvin F. THOMPSON, Appellant, v. M. J. HAYNES, Appellee.

No. M-3.

District Court of Appeal of Florida, First District.

June 10, 1971.

Rehearing Denied June 29, 1971.

Blalock, Holbrook, Lewis, Paul & Bennett, Jacksonville, for appellant.

Dawson, Galant, Maddox, Boyer, Sulik & Nichols, and Bruce Bullock, of Marks, Gray, Yates, Conroy & Gibbs, Jacksonville, for appellee.

*70CARROLL, DONALD, Judge.

The plaintiff in an automobile negligence case has appealed from a final summary judgment entered for the defendant by the Circuit Court for Duval County.

The ultimate question presented for our determination in this appeal is whether the plaintiff is legally barred from bringing the present action.

In his complaint, Marvin F. Thompson, the plaintiff, alleges that on a certain date the defendant, M. J. Haynes, “owned a motor vehicle being operated by Delores Haynes,” near a certain intersection in the said county; that she negligently operated or maintained the motor vehicle so that it collided with Thompson’s vehicle, resulting in series injuries to him as well as damages to his vehicle.

To this complaint M. J. Haynes filed his answer, denying the alleged negligence and damages, and incorporating a motion to dismiss, alleging that Thompson had already elected a remedy “in that he sued the operator and owner of the motor vehicle, Deloris Haynes, and recovered a judgment thereon * * Copies of the complaint and judgment in this previous action are attached to the said answer and motion. In the latter complaint Thompson alleges that Deloris Haynes owned and negligently operated the said motor vehicle at the time and place involved in the present action into Thompson’s automobile, causing the said injuries and damages. The said judgment, based upon a jury verdict, awarded to Thompson damages in the sum of $89,750. There is no dispute in this record and none in the briefs as to the fact of the previous action and the judgment therein. This judgment was partially satisfied by the liability insurer in the amount of $25,747.38, the limits of the insurance policy.

Haynes also filed in the present action a second amendment to his answer, stating that, prior to the institution of the present action, Thompson and Haynes had executed an agreement in which Thompson agreed never to execute any judgment against Haynes received or to be received on account of the injuries received in the said collision, in return for the assignment by Haynes to Thompson of his right to sue his liability insurance carrier for bad faith in failing to settle Thompson’s claim within the policy limits. We observe, without holding, that this agreement was probably an effort to “gang up” on the insurer. We need not, and do not, here pass upon the question of the validity and legal effect of the said agreement, .in view of our holding below that Thompson was barred from bringing the present action.

It is a difficult juridical problem to determine whether Thompson was precluded from filing the present action by applying the doctrine of res judicata or the doctrine of estoppel by judgment.

Both parties in their appellate briefs agree that the following from 19 Fla.Jur., Judgments and Decrees, Sect. 100, is a correct general statement of the law in Florida:

> “The law with respect to the doctrine of res judicata is well settled. The legal precept comprehended in the phrase ‘res judicata’ may be briefly defined as the doctrine that an existing final judgment or decree rendered on the merits without fraud or collusion, by a court of competent jurisdiction, is conclusive of the rights, questions, and facts in issue, as to *the parties and their privies,*in any other action in the same or in another court. The judgment or decree puts at rest and entombs all justiciable issues.” (Emphasis supplied)

In the light of the foregoing distinction, we are inclined to the view that Thompson is precluded from maintaining his present action under the doctrine of res judicata. While the parties defendant in the present and previous actions are not identical, the plaintiff is the same in each action. While M. J. Haynes is sued in the present action *71and Deloris Haynes in the previous, they no doubt are “privies” within the rule quoted above from Florida Jurisprudence. It is undisputed in the record that, at the time of the collision, they were husband and wife, co-owners of the motor vehicle which she was driving, and co-insureds under the same automobile liability insurance policy.

Our views as set forth herein are not, we think, in any way incompatible with the views which we expressed in our recent decision of Gerardi v. Carlisle, 232 So.2d 36 (Fla.App.1970), in which we held that the doctrines of res judicata and estoppel by judgment do not operate to bar a plaintiff, who has recovered a judgment against one tort-feasor from relitigating all issues in a subsequent action against a joint tort-fea-sor. We recognize that rule as applied to the facts in the Gerardi case, in which a plaintiff first filed an automobile negligence action against the operator of the other vehicle and recovered a judgment against that operator, and later filed an action against the owner of the other vehicle.

In the case at bar Deloris Haynes, the defendant in the first action, was sued not only as the operator of the vehicle but also as a joint owner. M. J. Haynes, the defendant in the second action, was sued in his capacity as a joint owner of the offending vehicle. It is therefore established that the defendants in each action were sued in the same right as co-owners of the vehicle. This being so, the defendant in the second action was in privity with the defendant in the first action, and the judgment rendered in the first action against the co-owner joint tort-feasor was res ju-dicata as to the action sought to be brought against the co-owner joint tort-feasor in the second action. Acceptance of payment by the plaintiff from the defendant in the first action operated to discharge the defendant in the second action from further; liability.

This case is distinguished from our decision rendered in Gerardi v. Carlisle, *supra,*as there the joint tort-feasors named as defendants in the two separate actions were not being sued in the same right, one having been sued as the operator of the vehicle and the other as the owner thereof. We held in that case that, although they were joint tort-feasors under the doctrine of respondeat superior, they were not in privity with each other to the extent that action against one operated as a bar against the other under the doctrine of res judicata. The same situation does not exist in the case at bar.

Our concept of privity in this case comports, we think, with the views prevailing in other jurisdictions. Those views are summarized in 46 Am.Jur.2d, Judgments, Sec. 532, pages 683 and 684, as follows:

> “There is no generally prevailing definition of privity which can be automatically applied to all cases involving the doctrine of res judicata. Who are privies requires careful examination into the circumstances of each case as it arises. In general, it may be said that such privity involves a person so identified in interest with another that he represents the same legal right. It has been declared that privity within the meaning of the doctrine of res judicata is privity as it exists in relation to the subject matter of the litigation, and that the rule is to be construed strictly to mean parties claiming under the same title. Under this rule, privity denotes mutual or successive relationship to the same right of property, so that a privy is one who, after the commencement of the action, has acquired an interest in the subject matter affected by the judgment through or under one of the parties, as by inheritance, succession, purchase, or assignment * * * ”

This generally prevailing rule is thus stated in 50 C.J.S. Judgments § 787, pages 322 to 324:

> “Privies

> “A judgment is conclusive and binding on persons who are in privity with the *72parties to the action with respect to the subj ect matter of the litigation.

> “A judgment is conclusive and binding, not only on the parties to the action in which it was rendered, but also on persons who are in privity with them with respect to the subject matter of the litigation, and this rule is applicable to both actions at law and suits in equity. Conversely, one who is not a party to a suit ordinarily is bound thereby only if he is shown to be in privity with a party. It is not material that the privity of one against whom an adjudication is urged does not appear of record in the previous suit. Those in privity with a party to the former litigation are bound because of derivative rights of property, because they have succeeded to some interest in the property subsequent to the commencement of the action, or because of a contractual relationship, and the extent of the estoppel is limited to controversies affecting the interest or estate as to which the privity exists.”

If any additional acts of estoppel were needed in the case at bar, one could find an estoppel by pleading, resulting from the fact that in the previous action Thompson alleged in his complaint that Deloris Haynes “owned” the motor vehicle she was driving, while in the present action Thompson alleges in his complaint that M. J. Haynes “owned” the said vehicle. Although this would seem to be a small matter if it stood alone, it no doubt adds a little weight to our above conclusion that the present action is barred.

We hold that, under the foregoing circumstances, the defendant was entitled to a summary judgment as a matter of law, so that judgment must be and it is

Affirmed.

WIGGINTON, C. J., concurs.

SPECTOR, J., dissents.

SPECTOR, Judge

(dissenting).

I respectfully dissent from the opinion of the majority of the court. The decision holds that a plaintiff in a personal injuries action may not sue the owner of a motor vehicle after he has concluded a separate suit against a permissive driver of the owned vehicle. The holding rests on the application of the doctrine of res adjudica-ta or estoppel as set out in 19 Fla.Jur., Judgments and Decrees, § 100.

The quoted language in the majority opinion is not applicable to the instant case. Gerardi v. Carlisle, 232 So.2d 36 (Fla.App.1970). In that case, discussing the concept of privity as it relates to an automobile owner and his permissive driver, the court distinguished that type of privity from that referred to in 19 Fla.Jur., Judgments and Decrees, § 100. Thus, it seems to me that the decision in Gerardi, supra, precludes the application of the privity doctrine as the basis for res adjudi-cata in cases involving successive suits against a permissive automobile driver and then the owner. I would reverse the summary judgment for the defendant for the following reason.

Appellant was plaintiff below in an action for injuries sustained when he collided with an automobile driven by appellee’s wife.1 The complaint against appellee al*73leged the same cause of action as that which was sued out against appellee’s wife with the exception that in the latter action appellant alleged the wife to be the driver and owner, whereas in this action the defendant husband’s alleged liability rests only on his ownership of the car driven by the wife.2 Appellee filed his answer denying ownership of the car involved and further denied the allegation of negligence and the alleged consequences therefrom. By his answer, appellee further interposed a motion to dismiss appellant’s complaint contending that appellant’s earlier action against appellee’s wife which resulted in the judgment referred to above constituted an election of remedies so as to bar the instant action. Apparently no ruling was made on appellee’s motion to dismiss on the election of remedies ground; and that narrow question, although falling squarely within the purview of our decision in Ger-ardi v. Carlisle, supra, is not before us now.

In due course, appellant moved for a partial summary judgment on the issues of liability and quantum of damages, thus leaving as the sole issue for determination by the trial court the question of appellee’s ownership of the automobile driven by the wife at the time of the accident. The denial of said motion for summary disposition of the liability [other than the ownership issue] and damage questions forms the basis of appellant’s first point on appeal.

Appellant argues that since the nature of an automobile owner’s liability is derivative from the acts of the driver, a judgment settling the issues of liability and damage against the driver is res adjudicata or the basis of an estoppel by judgment as against the owner. Appellant’s theory underlying this argumentation would, if accepted, result in the automatic imputation against an automobile owner of any judgment rendered against a nonowning permissive driver, even if the owner was not a party to the action against the driver and thus had no opportunity to defend.

The primary authority relied on by appellant for this contention is the language found in 19 Fla.Jur., Judgments and Decrees, § 100, briefly defining res adjudicata as that doctrine whereby a final judgment rendered on the merits without fraud or collusion by a court of competent jurisdiction is conclusive of the questions in issue as to the parties and their privies in any other action. By designating appellee herein as being in privity with the defendant driver of his car in the earlier suit, appellant opts for the entry of an $89,750 judgment against appellee, less the $25,-747.38 already paid under the insurance policy, of course. My examination of the authorities advanced in support of this point fails to persuade me that the contention has merit. Although it was decided after the briefs and argument in the case at bar, our opinion in Gerardi v. Carlisle, 232 So.2d 36, is dispositive of appellant’s contention. In that case, the court, distinguishing the character of privity obtaining between an owner of a car and a permissive driver from that sufficient to support invoking the doctrine of res adjudicata, said at page 43:

> “[6] Although admittedly the owner of a motor vehicle and the person operating it with his consent are in privity with each other under the doctrine of respon-deat superior, it is not that character of privity in which a judgment in favor of *74the plaintiff in a suit against one tort-feasor will be conclusively binding on the plaintiff as to all issues in a subsequent suit against a joint tort-feasor. * * **"*

After quoting from 19 Fla.Jur. 211 — 215, Judgments and Decrees, § 156, which states that there is no single, conclusive definition of a privy in cases involving res judi-cata, we concluded in Gerardi, at page 43, with the following:

> “It seems clear to us that the doctrines of res judicata and estoppel by judgment do not operate to bar a plaintiff who has recovered a judgment against one tort-feasor from relitigating all issues in a subsequent suit against a joint tort-fea-sor. Those are the facts present in the case sub judice and render the theory espoused by appellee inapplicable.”

The second point raised by appellant relates to the correctness of the trial court’s ruling granting appellee a summary judgment because the latter assigned any cause of action he might have against his insurer for failure to settle appellant’s claim within the policy limits or otherwise exercising bad faith toward appellee as the insured under the policy. Appellee’s rights against his insurer, as aforesaid, were assigned in consideration of appellant’s agreement never to execute any judgment against appel-lee, received or to be received as the result of injuries suffered in the accident “caused by a car owned by M. J. Haynes, in the suit won against M. J. Haynes’ former wife *or the suit soon to he brought against M. J. Haynes”.*(Emphasis supplied.) The complaint in the action sub judice was filed the next day after the assignment was executed.

Appellee contends that appellant’s agreement not to execute any judgment he might obtain stands as a bar to the instant action. The agreement not to execute is held out by appellee to constitute a release or satisfaction of any claim appellant might have against appellee, or, in the alternative, the agreement not to execute is said to render the action sub judice frivolous or vexatious, if not champertous. The last contention appears to be disposed of by the decision in Nationwide Mutual Insurance Co. v. McNulty, 229 So.2d 585 (Fla.1970). I have examined the instrument embodying the agreement not to execute in this case in light of the holding in Atlantic Coast Line Railroad Company v. Boone, 85 So.2d 834 (Fla.1956), and find that it is not a release. Rather, it is in the nature of a covenant not to sue. The distinction being that the covenantor promises not to execute any judgment he might get against the covenantee, rather than promising not to sue altogether. Of course, I am not concerned with the question of whether the agreement is a release in the sense once material under the common law rule relating to release of one joint tortfeasor, since that rule was abrogated by the enactment of Section 54.28(1), Florida Statutes, now numbered Section 768.041, Florida Statutes, F.S.A. See Adler v. Segal, 108 So.2d 773 (Fla.App.1959).

The real issue presented is whether an agreement not to execute is a bar to further prosecution of an action, particularly when such an agreement is entered into prior to commencement of the action. I do not think it is a bar.

In McNulty v. Nationwide Mutual Insurance Company, 221 So.2d 208 (Fla.App.1969), the court upheld an action by a judgment creditor against a liability insurer for an excess judgment earlier obtained in a suit against an insured, notwithstanding that the said judgment creditor had given an agreement to satisfy the excess portion of any judgment obtained beyond the policy limits in consideration of an assignment of the insured’s cause of action, if any, against his insurer for bad faith in failure to settle. The decision of the appellate court was later upheld in Nationwide v. McNulty, 229 So.2d 585, by the Supreme Court. In the McNulty case, the court laid to rest the assignability of a *75“bad faith” cause of action by an insured. See also Selfridge v. Allstate Insurance Company, 219 So.2d 127 (Fla.App.1969). In upholding such assignments, the court cited with approval Gray v. Nationwide Mutual Insurance Company, 422 Pa. 500, 223 A.2d 8 (1966), in which the court said:

> “The possibility of collusion between a judgment holder and an insured is no way increased by an assignment. If the insured’s liability on the judgment is not affected by the assignment, the interests of the parties are similarly unaffected. Whether the action would be brought in the name of the policy-holder or in the name of the assignee, the policy-holder would be intent upon relieving himself of the excess judgment, and the assignee would be seeking to secure the balance due him. If the insured’s liability is terminated by the assignment, as in the present case, the possibility of collusion is more remote. Having been relieved of the judgment, the insured no longer has any pecuniary interest in the outcome of the litigation.”

Perhaps the circumstance which renders the agreement not to execute most objectionable in the eyes of appellee is the fact that the agreement was entered into before the action was commenced against the insured, rather than after a judgment had been obtained. The validity of an assignment of a bad faith claim against an insurer, as affected by the assignment being made before the institution of an action, does not appear to have been considered by the reported decisions of this jurisdiction. The primary reason appellee contends such an assignment is invalid is the claim that it tends to produce frivolous or vexatious actions leading to collusion between the injured plaintiff and the insured defendant. The same contention was considered by a California appellate decision in Critz v. Farmers Insurance Group, 230 Cal.App.2d 788, 41 Cal.Rptr. 401, 12 A.L.R.3d 1142. There the court considered an assignment and covenant not to execute similar to the one in this case and held such an agreement not to be a bar. Since the Critz court wrote a detailed analysis of the relative duties, obligations and motives of the parties to a personal injuries action where liability insurance comes into play, 1 think it appropriate to quote extensively from that well reasoned opinion as follows:

“A related contention is that the assignment and covenant not to execute upon the judgment violate public policy by imparting a collusive character to the personal injury suit. * * *

“ * * * Farmers Group has stipulated that it was aware of the assignment before Mrs. Critz’s personal injury action went to trial. Thus David Arnold’s [the insured defendant] position was not concealed from the insurance company or its trial counsel. Arnold was not paraded before judge and jury as a culpable defendant, following an agreement which exonerated him from negligence. Objective of the assignment agreement was not to procure from Arnold testimony favoring his adversary. (Cf., Pellett v. Sonotone Corp., supra, dissent of Traynor, J., 26 Cal.2d 705, at p. 715, 160 P.2d 783.) There is no claim that Arnold actually said or did anything which jeopardized defense of the lawsuit. Nothing in the assignment agreement impelled him toward false testimony. His motivation was to protect himself from potential personal liability flowing from the insurer’s rejection of the $10,000 settlement offer. Mrs. Critz’ motivation was to strengthen her position vis-a-vis an insurer which had forced her into the delay and expense of litigation. The alliance between these motivating forces did not result in a collusive lawsuit, either in terms of natural tendencies or actual results.

“While liability insurers are the frequent targets of inflated injury claims, it often happens that the injured claimant is constrained by financial necessity to sacrifice part of his claim’s value in the interest of an early cash settlement. The advantages of time and solvency are on the insurer’s *76side. When medical expenses are high and the policy limit is low, pressure to settle is accentuated. When a limited liability insurer rejects an offer to settle a damage case at much less than its reasonably appraised value, it not only exposes its policyholder to the possibility of serious personal liability but also trades on the inferior economic position of the injured claimant. If an assignable claim exists at all, it exists only because the insurer has previously breached its obligation of good faith toward its policyholder.

‘Unless plaintiff as assignee can convince the trier of fact that the carrier in this case did not exercise good faith, plaintiff cannot prevail.’ (Martin v. Hartford Acc. & Indem. Co., supra, 228 A.C.A. 200, at p. 207, 39 Cal.Rptr. 342, at p. 347.) To uphold an equitable assignment under such circumstances does not supply the injured party with a disproportionate or unfair advantage. In our opinion, the present assignment is not violative of public policy if in fact a bad faith rejection had already occurred. If, on the other hand, the carrier was not guilty of bad faith, the plaintiff-assignee will lose the lawsuit regardless of the public policy aspects of the assignment.

“Insurance policy provisions frequently prevent assignment without consent of the insurer prior to a loss. (Greco v. Oregon Mutual Fire Ins. Co., 191 Cal.App.2d 674, 682, 12 Cal.Rptr. 802.) Defendant asserts that the Arnold-Critz agreement attempted to assign the policyholder’s rights before the latter had suffered any loss by an adverse judgment against him. The assertion is unavailing. A provision against assignment of rights under a policy does not preclude transfer of a cause of action for breach of the policy. (Comunale v. Traders & General Ins. Co., supra, 50 Cal.2d 654, at pp. 661-662, 328 P.2d 198.)

“One more contention should be noted. Defendant argues that the hold harmless clause, in effect a covenant not to execute against Arnold, prevented the latter from suffering any damage by reason of the personal judgment against him. If, as a trier of fact may find, the carrier violated its duty of good faith, the damage, however potential, occurred at that time. As noted in the Ivy case, supra, Ivy v. Pacific Auto. Ins. Co., 156 Cal.App.2d 652, at page 662, 320 P.2d 140, a covenant not to execute is not a release. (See also Pellett v. Sonotone Corp., supra, 26 Cal.2d 705, 160 P.2d 783.) It did not blot out the personal judgment against Arnold or extinguish his claim for breach of contract against the carrier.”

The appellant is not barred from proceeding with his action against the appellee by reason of the assignment and agreement not to execute involved herein. The summary judgment reviewed herein should be reversed.

1

. Appellant sued the wife in an earlier action arising from the same accident, which resulted in a judgment in appellant’s favor for $89,750. That judgment was partially satisfied by the wife’s liability insurance carrier by payment of $25,-747.38, the limits of the insurance policy. Subsequent to the partial satisfaction noted, appellant brought suit against the wife’s insurer to recover the balance of the aforesaid judgment on the ground of alleged bad faith of the insurer in not settling his claim against the insured wife within the policy limits. That suit was brought directly against the insurer by the insured’s judgment creditor. No *73assignment was made to the appellant by the insured wife of her right to sue her insurer for negligent failure to settle the claim against her within the liability policy limits. The direct action was dismissed in the trial court, and we affirmed the dismissal. See Thompson v. Commercial Union Insurance Co. of New York, 237 So.2d 247 (1970). Our de-cisión in Thompson is presently pending review by certiorari in the Florida Supreme Court.

2

. At the time of these actions, the Haynes were no longer husband and wife, although that was their status at the time of the accident underlying both of appellant’s actions.