Court Opinion

ID: 9527895
Source: CourtListenerOpinion
Date Created: 2023-08-07 03:35:24.906965+00
Date Added: 2024-06-11T13:26:16.462800
License: Public Domain

STATON, Presiding Judge.
I dissent from the Majority since they have re-drafted the rule to include a concept never contemplated by the original drafters of the rule. They have re-drafted Small Claims Rule 11(F) to read as follows:
A judgment shall be res judicata only as to the issue involved in the particular action and shall not be considered an adjudication of any other issue in any other action or court.
The actual text of the Rule reads as follows:
"Effect of Judgment. A judgment shall be res judicata only as to the amount involved in the particular action and shall not be considered an adjudication of any fact at issue in any other action or court."
Section 1808 of the New York City Court Act is virtually identical to the Indiana Small Claims Rule 11(F). It provides:
Judgment obtained to be res judicata in certain cases. A judgment obtained under this title may be pleaded as res judi-eata only as to the amount involved in the particular action and shall not otherwise be deemed an adjudication of any fact at issue or found therein in any other action or court. (Formerly § 186 of the New York City Municipal Court Code.) ©
In Auster v. Princess Fabrics, Inc. (1940), 174 Misc. 1096, 22 N.Y.S.2d 686, the Court had essentially the same fact situation before it as in the present case. A judgment was entered for the plaintiff in a specific *234amount as his damages. Later in a second action, the defenses of res adjudicata and accord and satisfaction were raised. The judgment in the small claims court had been paid. As to these defenses the Court held:
If the judgment were procured in the Municipal Court itself, or in any other court, I think it would be res adjudicata. (Citation omitted.) But that is not so where the judgment is obtained in the Small Claims Part. The statute changes the rule, so that any judgment in the Small Claims Part is res adjudicata only as to the amount involved and as to nothing else, (Citation omitted).
In a second action where the plaintiff had received a judgment in the small claims court below as presented here, the issue and facts surrounding the amount of damages would be a proper counterclaim under Rule 11(F); however, the amount of the judgment would be offset against any larger amount received in the second action. If this were not so under the clear, unambiguous language of the Rule, the defendant in the small claims court could limit his liability exposure by postponing any action in another court of greater jurisdiction. If the plaintiff in the small claims court should later learn that the extent of his injuries and damages were far greater than he first expected, he would be helpless to assert a valid counterclaim. There is no provision in the Rules for a waiver by the plaintiff. There is nothing in the Rules to contradiet this concept of fairness.
There appears to be some motivation in the Rules for the defendant with a counterclaim or a good cause of action which exceeds the jurisdiction of the small claims court to file a separate action. If he does not file a separate action and waives the excess of his counterclaim in the small claims court, he cannot bring a separate action later for the excess of his counterclaim. Small Claims Rule 5(B) provides:
Counterclaim in Excess of Jurisdiction. The defendant in a counterclaim may waive the excess of his claim over the jurisdictional maximum to bring it within the jurisdiction of the small claims docket. If the defendant elects to waive a portion of his counterclaim he may not later maintain a separate action for the remainder of such claim.
When Small Claim Rules 11(F) and 5(B) are read together, they suggest that the drafters were primarily concerned with protecting the defendant who had a counterclaim from the defense of res adjudicata in a later action in another court with different jurisdictional limits. However, the language of the Rules does not prohibit a plaintiff from re-asserting his original claim in a second action brought by the small claims court defendant. The language in Small Claims Rule 11(F) is almost identical to the New York rule. It has been interpreted to mean res adjudicata as to the amount only and later litigation as to the issue of damages and the facts reflecting those damages may be re-litigated in another action and in another court. Aus-ter, supra.
Therefore, I dissent from the re-drafting of Small Claims Rule 11(F) by the Majority, and I would affirm the judgment of the trial court.