The question presented by this appeal is whether or not the principle of res judicata applies.
The facts in so far as necessary to present the issue here involved are briefly as follows: The actions lie in negligence. They grow out of an accident in which a truck owned by the New York and Pennsylvania Motor Express, Inc. (Penn.) collided with one owned by the United States Trucking Corporation (United). Damages to person and property resulted. Penn. sued United for property damage to its truck. United brought an independent action for property damage to its truck against Penn. These two actions were consolidated and, after a trial of all the issues, a jury awarded a verdict to United. On the basis of this recovery by United for its property damage, the driver of United's truck, one Elder, now brings this action against Penn., which was both a plaintiff and a defendant in the previous action, for his personal injuries. At the trial of the present action, Elder moved for the direction of a verdict in his favor upon the ground that the judgment obtained by his employer, United, was conclusive against Penn. The trial court denied the motion and a trial was had on *Page 352 the evidence before a jury which returned a verdict in favor of the defendant. Upon appeal by the plaintiff to the Appellate Division, the parties stipulated that the sole question to be reviewed would be the application of the doctrine of resjudicata as it related to the case at bar. The Appellate Division, one justice dissenting, ruled that the judgment in the prior consolidated action was res judicata as to the defendant's liability to the present plaintiff; the judgment at the Trial Term was reversed and a new trial was ordered. We now review the order of the Appellate Division upon a stipulation by the defendant for judgment absolute.
The sole question involved in this appeal is whether or not Elder can plead the judgment obtained by United against Penn. in the previous action as res judicata.
No plea in bar could estop the plaintiff from enforcing his rights since he was not a party to the prior action, unless he came within an exception to the rule of mutuality, which rule is embodied in the principle of res judicata. When issues on the same subject-matter have once been settled by litigation between the same parties or their privies, before a court of competent jurisdiction, and the estoppel of the judgment is mutual, that is to say that the other party would be bound if the original decision had been to the contrary, then in the interest of reasonable finality of litigation that decision should be conclusive. A well-recognized "apparent exception to this rule of mutuality" exists where liability for the fault of an agent or servant or indemnitee is asserted against a principal, master or indemnitor. In such case where there has been a prior judgment in favor of the agent, servant or indemnitee rendered in an action brought against him by the same plaintiff, such judgment destroys the basis of liability asserted against the principal, master or indemnitor and constitutes a complete defense to the action thereafter brought against him. (Bigelow v. Old DominionCopper Mining Smelting Co., 225 U.S. 111, 127.) We followed that principle in Good Health Dairy Products Corp. v. Emery (275 N.Y. 14). *Page 353
In the Good Health case the liability of the owner was dependent upon a recovery from the person from whom the liability was derived. The plea of res judicata there was considered solely as a defense since no attempt was made to plead it in support of the counterclaim, or to use it to establish liability affirmatively. In the consideration of the plea of res judicata in bar of the action, the relationship between principal and surety, while only partly analogous, illustrates the liabilities involved. If, despite the fact that the driver in the GoodHealth case had been found by the jury free from negligence, we had allowed a recovery against the owner, then the latter could have recovered over against the driver, surely an extraordinary result.
If, as urged by respondent, we eliminate in the rule followed in the Good Health case, the necessity of the liability being dependent upon the negligence of the servant and permit a reliance upon a judgment as res judicata, where identical issues of liability upon a given set of facts are put at issue in two successive suits, and where a full and complete trial of those issues has been had, and there are no circumstances of record in the second suit which might reasonably justify a court in reaching a result contrary to the prior decision, then it would seem that we would eliminate entirely the requirements of mutuality of estoppel and of privity. In so doing it is submitted that this would overturn fundamental conceptions and overrule authorities. (Haverhill v. International Ry. Co., 217 App. Div. 521; affd., 244 N.Y. 582; Atlantic Dock Co. v. Mayor,53 N.Y. 64, 68; Booth v. Powers, 56 N.Y. 22; Nelson v.Brown, 144 N.Y. 384, 390.) In the Haverhill case the court refused to allow plaintiff employer to introduce the prior judgment in favor of his employee, since there was no mutuality of estoppel. Heretofore also the rule of mutuality has been held operative in actions ex delicto and permits successive suits by different passengers based on the negligence of the defendant carrier arising out of the same accident where the identical issues arise in each trial. In the case at bar plaintiff was one of the two principal actors in the collision and his right to *Page 354 recover has not been adjudicated in the previous action. The proposed abrogation of the rule of mutuality would seem to lead to a complete abrogation of the rule, even if the new exception now urged upon us should be confined to that class of cases where the defendant has been a plaintiff in the prior action.
The order of the Appellate Division should be reversed and the judgment of the Trial Term affirmed, with costs in this court and in the Appellate Division.