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Recently, we summarized our position with respect to
collateral estoppel as follows:
The doctrine of issue preclusion, or collateral
estoppel, provides that, once an issue of fact or law
is “actually and necessarily determined by a court of
competent jurisdiction, that determination is
conclusive in subsequent suits based on a different
cause of action involving a party to the prior
litigation.” Montana v. United States, 440 U.S. 147,
153 (1979) (citing Parklane Hosiery Co. v. Shore, 439
U.S. 322, 326 n.5 (1979)). Issue preclusion is a
judicially created equitable doctrine whose purposes
are to protect parties from unnecessary and redundant
litigation, to conserve judicial resources, and to
foster certainty in and reliance on judicial action.
See, e.g., id. at 153-154; United States v. ITT
Rayonier, Inc., 627 F.2d 996, 1000 (9th Cir. 1980).
This Court in Peck v. Commissioner, 90 T.C. 162, 166-
167 (1988), affd. 904 F.2d 525 (9th Cir. 1990), set
forth the following five conditions that must be
satisfied prior to application of issue preclusion in
the context of a factual dispute (the Peck
requirements):
(1) The issue in the second suit must be identical in
all respects with the one decided in the first suit.
(2) There must be a final judgment rendered by a court
of competent jurisdiction.
(3) Collateral estoppel may be invoked against parties
and their privies to the prior judgment.
(4) The parties must actually have litigated the
issues and the resolution of these issues must have been
essential to the prior decision.
(5) The controlling facts and applicable legal rules
must remain unchanged from those in the prior
litigation. [Citations omitted.]
See also Clark v. Bear Stearns & Co., 966 F.2d 1318,
1320 (9th Cir. 1992)(highlighting conditions (1) and
(4) above).
Monahan v. Commissioner, 109 T.C. 235, 240 (1997).
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