Court Opinion

ID: 3748226
Source: CourtListenerOpinion
Date Created: 2016-07-06 07:09:28.245707+00
Date Added: 2024-06-11T18:03:38.243994
License: Public Domain

I respectfully dissent. Appellant asserts that case No. 92 CV 2032 was an action brought by himself, whereas this case was brought in his representative capacity as a shareholder to enforce the right of the corporation, and, therefore, resjudicata and collateral estoppel do not apply. This argument is without merit.
Appellant's complaint is a shareholder derivative action brought pursuant to Civ.R. 23.1, which reads as follows:
"In a derivative action brought by one or more legal or equitable owners of shares to enforce a right of a corporation, the corporation having failed to enforce a right which may properly be asserted by it, the complaint shall be verified and shall allege that the plaintiff was a shareholder at the time of the transaction of which he complains or that his share thereafter devolved on him by operation of law. The complaint shall also allege with particularity the efforts, if any, made by the plaintiff to obtain the action he desires from the directors and, if necessary, from the shareholders and the reasons for his failure to obtain the *Page 750 
action or for not making the effort. The derivative action may not be maintained if it appears that the plaintiff does not fairly and adequately represent the interests of the shareholders similarly situated in enforcing the right of the corporation. The action shall not be dismissed or compromised without the approval of the court, and notice of the proposed dismissal or compromise shall be given to shareholders in such manner as the court directs."
The complaint was dismissed pursuant to the doctrines ofres judicata and collateral estoppel. Res judicata has been defined by the Ohio Supreme Court:
"The rule is well settled that an adjudication in one action between the same parties is final and conclusive not only as to the matter actually determined but as to every other material issue which the parties might have litigated, incident to or connected with the subject-matter of the litigation." Schram v.Cincinnati (1922), 105 Ohio St. 324, 329, 137 N.E. 868, 870.
Certainly, the complaint under study raises a material issue which could have been litigated in the previous case and which was incident to or connected with the matter of that litigation. The doctrine of collateral estoppel has been defined by the Ohio Supreme Court as follows:
"The doctrine of res judicata involves two basic concepts.Norwood v. McDonald (1943), 142 Ohio St. 299, 27 O.O. 240,52 N.E.2d 67. First, it refers to the effect a judgment in a prior action has in a second action based upon the same cause of action. * * *
"The second aspect of the doctrine of res judicata is `collateral estoppel.' * * * the collateral estoppel aspect precludes the relitigation, in the second action, of an issue that has been actually and necessarily litigated and determined in a prior action which was based on a different cause of action. * * * In short, under the rule of collateral estoppel, even where the cause of action is different in a subsequent suit, a judgment in a prior suit may nevertheless affect the outcome of the second suit." Whitehead v. Gen. Tel. Co. (1962), 20 Ohio St.2d 108,112, 49 O.O.2d 435, 437-438, 254 N.E.2d 10, 13.
The plaintiff-appellant contends that case No. 92 CV 2032 was brought in his individual capacity to address a right he had as an individual shareholder. Plaintiff-appellant goes on to argue that the case at hand is a shareholder derivative action, which is a right of redress belonging not to the shareholder but to the corporation. Scullin v. Mut. Drug Co. (1941), 138 Ohio St. 132,133, 20 O.O. 126, 126-127, 33 N.E.2d 992, 993-994. Appellant further argues that the issues in this derivative suit are not the same as those raised in the earlier case. The appellant points out that his present complaint alleges that the appellees misused appropriated and converted assets of the corporation for their own personal benefit and wasted corporate assets. To establish its case, appellant *Page 751 
contends that it must present evidence that the corporate distributions were excessive, unauthorized, fraudulent and wasteful. Appellant argues that this evidence was not relevant to the earlier case, as appellant there alleged that the appellees denied him access to corporate records, excluded him from corporate meetings, and failed to maintain corporate books pursuant to statute.
In summary, appellant reasons that the two cases were unrelated and that the doctrines of res judicata and collateral estoppel do not apply.
Reviewing the record placed before the trial court and the motion for summary judgment leads me to the conclusion that the trial court in this case was correct. The issues are basically the same in both cases. The only thing different is the manner in which the case was captioned. The outstanding fact presented by the motion for summary judgment is a portion of the proceedings before the trial judge in case No. 92 CV 2032. Addressing the trial judge, counsel for the plaintiff-appellant stated:
"Your Honor, I believe that we can stipulate a settlement to resolve all issues pending in this case."
When one reads the transcript from case No. 92 CV 2032, it is not difficult to arrive at the conclusion that, based upon proposals by counsel for the plaintiff-appellant, all issues between all of the parties involved in that case and involved in this case were settled and resolved in the final judgment entry of the trial judge. That final judgment entry has been the subject of an appeal to this court, and, in final disposition of the appellate case, this court has affirmed and modified the judgment entry of the trial court.
The first assignment of error should be found to be without merit.
The second assignment of error contends that the trial judge erred in ruling that a judgment granting equitable relief in an earlier action operates as a bar to this action, which seeks only money damages.
I again return to the transcript of proceedings in the prior case and again recite the fact that the same counsel in that case informed the trial judge that issues between all the parties were settled. These parties are entitled to a finality of what has become an obviously very expensive family dispute. The settlement rendered in the prior case is a bar to this case.
This second assignment of error should be found to be without merit.
The third assignment of error complains that the trial court erred in ruling that a judgment entry enforcing a settlement of all issues pending in an earlier action operates as a bar to this action, which involves only issues not previously raised in the earlier action. *Page 752 
The issues raised in this action could have been raised in the earlier action. This is a material issue which might have been litigated and certainly was incident to or connected with the subject matter of the prior litigation. Schram v.Cincinnati (1922), 105 Ohio St. 324, 329, 137 N.E. 868, 870.
This third assignment of error should be found to be without merit.
In my opinion, the judgment of the trial court should be affirmed.