Res Judicata in Texas: What is "same subject matter" for re-litigation purposes?

RES JUDICATA Res judicata precludes relitigation of claims that have been finally adjudicated, or that arise out of the same subject matter and that could have been litigated in the prior action. Amstadt v. U.S. Brass Corp., 919 S.W.2d 644, 652 (Tex. 1996). In determining what constitutes “the same subject matter,” Texas courts follow the “transactional” approach to res judicata set forth in the Restatement (Second) of Judgments. See Barr v. Resolution Trust Corp., 837 S.W.2d 627, 631 (Tex. 1992). The Restatement “provides that a final judgment on an action extinguishes the right to bring suit on the transaction, or series of connected transactions, out of which the action arose.” Id. (citing Restatement (Second) of Judgments § 24(1) (1982)). Whether facts constitute a “transaction” or “series” is to be determined pragmatically, giving weight to such considerations as whether the facts are related in time, space, origin, or motivation, whether they form a convenient trial unit, and whether their treatment as a unit conforms to the parties' expectations or business understanding or usage. Restatement (Second) of Judgments § 24(2); see Barr, 837 S.W.2d at 631. SOURCE: Dallas Court of Appeals 05-10-00070-CV 5/12/11 A claim under a liability indemnification clause does not accrue, and thus is not mature, until the indemnitee's liability to the party seeking damages becomes fixed and certain.” Ingersoll-Rand Co. v. Valero Energy Corp., 997 S.W.2d 203, 208 (Tex. 1999). However, a party may bring an indemnity claim before the judgment establishing liability is final in the interest of judicial economy. Id. at 209. The indemnity claim in that situation is permissive, not compulsory. Id. at 210. But, if a party brings a permissive indemnity claim, it is required under res judicata to bring all other claims in the same action arising out of the same subject matter. See Getty Oil Co. v. Ins. Co. of N. Am., 845 S.W.2d 794, 799-800 (Tex. 1992). For a counterclaim to be compulsory, the claim must be mature and owned by the defendant when it files its answer. Ingersoll-Rand Co., 997 S.W.2d at 207. SOURCE: Dallas Court of Appeals 05-10-00070-CV 5/12/11 LEGAL TERMS: permissive vs. compulsory counter-claim, relitigation of claims, collateral estoppel, claim preclusion