Opinion ID: 1994775
Heading Depth: 1
Heading Rank: 4

Heading: The DMMHA's Breach-of-Contract Claim.

Text: We next consider the DMMHA's motion for summary judgment concerning its breach-of-contract claim. It sought summary judgment based on factual findings made in the grievance proceedings by two administrative hearing officers. In these proceedings, Hunter was found to have violated the terms of the lease agreement. The DMMHA contends these findings are res judicata and affirmatively establish that Hunter violated the lease. Hunter claims the doctrine of issue preclusion does not apply to these findings for several reasons. Chief among her reasons is the DMMHA failed to provide a notice to cure, and its failure to do so divested all adjudicative bodies of subject matter jurisdiction so that their findings are void. Generally, a defect in the notice requirements under section 562A.27(1) deprives the trial court of jurisdiction to hear a forcible entry and detainer action to recover possession of the leased property. Liberty Manor v. Rinnels, 487 N.W.2d 324, 326 (Iowa 1992). Yet, this principle does not impact this case because the DMMHA was not required to provide the notice to cure under section 562A.27(1). Thus, even if we presume this principle applies to the prior administrative and federal proceedings, the adjudicative bodies in these proceedings had jurisdiction to hear the issues presented. Hunter also argues, as the court of appeals determined, that an exception to the issue-preclusion doctrine applies in this case under our holding in Grant. 722 N.W.2d at 175. In other words, Hunter argues we cannot give res judicata effect to the grievance hearing decisions because the grievance hearing proceedings were not the type of administrative hearings recognized in Iowa to justify res judicata. Such a conclusion, however, misinterprets our holding in Grant. In Grant we were presented with the issue whether the department of human services could adjudicate a request to correct an assessment of child abuse after a district court had determined in a prior parallel proceeding that the child abuse occurred. We recognized an exception to the application of issue preclusion when `[a] new determination of the issue is warranted by differences in the quality or extensiveness of the procedures followed in the two courts or by factors relating to the allocation of jurisdiction between them,' id. (quoting Restatement (Second) of Judgments § 28(3), at 273), and ultimately held that the department of human services could correct its own assessment. However, the justification for permitting relitigation under the exception was based on the clear legislative scheme allocating jurisdiction of the issue to the department of human services. The ruling was narrow and largely predicated on the special statutory process in place. Importantly, the decision was not based on differences in the quality or extensiveness of the procedures. Thus, because Hunter relies on the differences in the quality and extensiveness between the procedures of the prior grievance proceedings and the district court proceeding to support her claim for relitigation, Grant provides little support. Our review of procedures available to tenants under a grievance process reveals they comport with due process and afford a tenant a full and fair opportunity to litigate the factual issues. See 24 C.F.R. § 966.56. These procedures include the right to be represented by counsel, the right to present evidence and arguments in support of a tenant's complaint, and the right to examine witnesses. See id. § 966.56(b). The procedures largely resemble those normally provided in a court proceeding. Moreover, the decision of a grievance officer is, and was in this case, subject to review in federal court. Nevertheless, Hunter points out that the grievance procedure requires a tenant to first make a showing of entitlement to relief before the housing agency has the burden to justify its actions. See id. 966.56(e). The requirement for the tenant to make a preliminary showing does not alter our conviction that any difference in the quality or extensiveness of the procedures in the grievance proceedings and in the underlying district court proceeding are not significant. We have not required identical procedures in determining whether to permit relitigation of issues, but primarily look to those procedural differences likely to cause a different result or differences that otherwise deprive a litigant of an opportunity to fully litigate the issues. See Iowa Supreme Ct. Bd. of Prof'l Ethics & Conduct v. D.J.I., 545 N.W.2d 866, 873 (Iowa 1996); Restatement (Second) of Judgments § 28(4) (relitigation not precluded if party had a significantly heavier burden). There is nothing in the record in this case to suggest the applicable procedures would likely cause a different result or play any significant role in the outcome. In fact, the hearing officer in the grievance proceedings in this case specifically found by a preponderance of the evidence that the DMMHA established Hunter violated the two provisions in the lease that are the basis for the DMMHA's breach-of-contract claim. Thus, the burden-shifting procedure used in the grievance process ultimately placed the burden on the DMMHA to establish the violations. As a result, we see no reason why the grievance decisions should not be afforded the effect of res judicata. See Pinkerton v. Jeld-Wen, Inc., 588 N.W.2d 679, 680 (Iowa 1998) (A final adjudicatory decision of an administrative agency is regarded res judicata the same as if it were a judgment of the court.). Finally, Hunter claims federal law does not permit grievance decisions to be used to affect other court proceedings, such as her contract action for damages. Federal regulations provide [a] decision by the hearing officer . . . in favor of the [DMMHA] or which denies the relief requested by the complainant in whole or in part shall not constitute a waiver of, nor affect in any manner whatever, any rights the complainant may have to a trial de novo or judicial review in any judicial proceedings, which may thereafter be brought in the matter. 24 C.F.R. § 966.57(c) (emphasis added). While there is very little judicial authority on the application of this regulation, we question whether it prohibits a grievance decision from being used to preclude relitigation of the issues decided. A breach-of-contract action for damages by the DMMHA is not a judicial proceeding thereafter . . . brought in the matter.  It is a separate matter. More importantly, however, even if we assume the federal regulation intended to preclude any res judicata effect of grievance decisions, this state is not obligated to follow the pronouncement. It is our task to determine whether the doctrine of res judicata may be applied in our courts to administrative decisions or particular types of administrative decisions, [9] and we are satisfied the doctrine is properly applied in this case. We conclude the DMMHA was entitled to summary judgment on its counterclaim. Hunter violated the lease, and the DMMHA performed the terms and conditions for termination. The parties stipulated to the damages, and Hunter provided no evidence to the contrary. We reject all claims made by Hunter in opposition to summary judgment.