Court Opinion

ID: 6911033
Source: CourtListenerOpinion
Date Created: 2022-07-23 22:22:12.414614+00
Date Added: 2024-06-11T16:06:30.320934
License: Public Domain

L. HAND, Circuit Judge
(concurring).
I agree in the result as to all the defendants, and in the reasoning by which it is reached as to all except Brown. As to him I rest my vote upon somewhat different grounds. I do not believe that a judgment in favor of one director of a corporation is res judicata in favor of the others; but, since in the case at bar the directors were all joint tortfeasors, I rely upon the doctrine that the release of one releases all. That doctrine has been somewhat impaired, and was never well grounded in its absolute and unconditional form; but I am content arguendo to accept the following statement of it by Mr. Justice Rutledge (then in the Court of Appeals of the District) 1: “Whether the settlement is made and accepted as full satisfaction or merely as the best obtainable compromise for the settler’s liability is the crucial issue, and ordinarily one of fact. If however the agreement’s terms leave no room for doubt, the decision should be made as a matter of law.” I also accept the following gloss of the Restatement2: “a document in the usual form of a release given to one of them” (several joint tortfeasors) “is construed as intended to discharge all claims for the tort and operates to discharge others also liable for the same harm.” The release in the case at bar satisfied both these tests. Its preambles recited among other things that “the parties desire to dismiss and compromise the stockholders derivative action” (the Michigan suit) “and to resolve all of the controversies raised by the allegations of the amended complaint.” Again, “the plaintiffs deem it in the best interest of Kaiser-Fraser * * * that the stockholders derivative action be dismissed and compromised upon the terms and conditions hereinafter set forth.” The operative words of release included “all claims, charges and allegations set forth in the amended complaint and the notice to amend and supplement the amended complaint.” Finally, the parties clearly meant to put an end to any claim against Brown for the release included him, eo nomine; indeed it appears that he was omitted as a defendant to the action only because his presence would destroy the jurisdiction of the court.
Although the Michigan judgment does not estop the plaintiff in this action from *69attacking the validity of the release as to Brown, and although the district court would therefore be free to decide that it should be set aside, it would still be obliged to dismiss the complaint because the release of the other directors would remain unscathed. The situation might be different if the Michigan judgment had been on the merits of the claim; I need not say whether such a judgment would release Brown. The corporation had actually executed the release, and the Michigan judgment did no more, and needed to do no more, than decide that the consent so given was not vulnerable to any attack by the releasor. That enabled Brown to invoke the doctrine I mention.
FRANK, Circuit Judge, concurs in Judge HAND’S opinion.

. McKenna v. Austin, 77 U.S:App.D.C. 228, 134 F.2d 659, 664, 148 A.L.R. 1253.

. Restatement of Torts, Yol. 4, § 885, Comment (d).