First District Holds that Claims that Could Have Been Raised in Prior Litigation Are Barred by the Doctrine of Res Judicata

In Atwell v. City of Rohnert Park, No. A151896, A153011, (Sept. 26, 2018), __Cal.App.5th__, the First District Court of Appeal upheld a lower court’s ruling in favor of the respondent city on a motion for judgment on the pleadings, finding that petitioner’s claims were barred by the doctrine of res judicata. The First District’s opinion, not originally slated for publication, held that subsequent individual petitioners were in privity with the Sierra Club in a prior suit, that the same claim of inconsistency with the general plan could have been raised in that prior suit, and the public interest exemption to the doctrine of res judicata did not apply in the circumstances of the instant case.

In 2010, the city certified an EIR and related approvals for Walmart to expand an existing store to include a 24-hour supermarket. The city found that the project was consistent with its General Plan’s Policy LU-7, concerning land use for grocery stores. Sierra Club filed suit in 2012 under the California Environmental Quality Act (CEQA) and the state Planning and Zoning law (“Sierra Club action”). While Sierra Club raised the general plan consistency issue in its initial pleading, it did not argue it in its briefing. The court in the Sierra Club action consequently did not address the issue in its decision invalidating the EIR.

The city prepared a revised EIR in 2015, but it did not alter the consistency analysis involving Policy LU-7. The city subsequently reapproved the project. In its 2015 findings, the city stated that the project was even more consistent with Policy LU-7 than before, as it would serve several neighborhoods that were now coming online in the store’s vicinity. Petitioners in the instant action, who had not participated in the prior Sierra Club action, filed this suit. The city successfully moved for a judgement on the pleadings, and this appeal followed.

Following a final judgment on the merits, the doctrine of res judicata bars a party, and persons in privity with that party, from relitigating a claim that was actually litigated or that could have been litigated in the prior action. At issue is whether the current petitioners are in privity with Sierra Club, and if the general plan consistency claim was litigated in the prior action.

The court concluded that the two petitions raised the same general issue, as both alleged inconsistencies with the same general plan policy. The court considered it irrelevant that Sierra Club did not argue this issue in its briefing, even though it raised it, as res judicata extends to claims that could have been litigated, even if they weren’t.

In reaching this decision, the court dismissed the petitioners’ argument that the claims were different because they challenged the newer 2015 findings. For purposes of res judicata, plaintiffs have suffered the same injury when the same primary right is at stake, even if there are different theories of recovery, different forms of relief sought, or if there are new facts supporting recovery. The court distinguished the instant case from other decisions in the land use and CEQA context, where the second suit was a factually-distinct attempt to comply with CEQA and concerned distinct episodes of noncompliance. That was not the case here. Even though the city’s 2015 resolutions were “new” and revisions were made to other sections of the EIR as a result of the Sierra Club action, the court decided that the later petition did not raise concerns about those revisions, and those revisions were unrelated to Policy LU-7.

The court found that the instant and previous parties were in privity, even though the later petitioners were unaffiliated with Sierra Club, did not otherwise coordinate with or collaborate with the Sierra Club, did not participate in the prior suit, and were seeking redress for both public and private harms.

A nonparty is in privity with a prior party if they have an interest so similar to that party’s interest that the party acted as the nonparty’s virtual representative in the first action, such that the nonparty can reasonably expect to be bound by the prior decision. The actual relationship between the parties is not the key question, but rather, those entities’ relationship to the subject matter of the litigation.

Here, both appellants’ petition and the prior petition alleged claims as members of the public and harms that would be suffered by the community. The petitioners failed to distinguish the harms that they would suffer, directly or indirectly, from the harms alleged in the Sierra Club action, nor could the court find meaningful distinction.

The petitioners were adequately represented in the prior suit, even though Sierra Club ultimately decided not to pursue the general plan consistency claim. Lack of adequate representation has been found when the prior petitioner abnegated its role as a public agent, committed a procedural error that prejudiced the outcome, or lacked the funding to pursue the claim. There was no such evidence in this case. The court therefore assumed that the Sierra Club diligently litigated their petition, and made an informed decision not to pursue the consistency argument. The current petitioners were bound by this tactical decision.

The court rejected the petitioners’ argument under the public policy exception. The public policy exception holds that when the issue is a question of law rather than of fact, the prior determination is not conclusive either if injustice would result or if the public interest requires that relitigation not be foreclosed. The petitioners argued that they raised a unique and important issue of statutory construction. But this situation was not a question of law regarding statutory interpretation. Rather, at issue was the interpretation of an ordinance as applied to a project approval. Such a claim inherently requires the court to consider the facts and circumstances surrounding the project, and not just questions of law.

Finally, the court stated that even if the claims were not barred by res judicata, the city’s finding of consistency was not arbitrary and capricious. The city had discretion to interpret its own policies, and could determine that the project would meet that policy’s goal of creating neighborhood-serving supermarkets.