River City Ranches #1 Ltd., Leon Shepard, Tax Matters Partner - Page 55

                                        - 40 -                                         
          (1988), affd. 904 F.2d 525 (9th Cir. 1990).  For collateral                  
          estoppel to apply in a factual context, the following conditions             
          must be met:  (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 have actually litigated the issues and the resolution of                
          these issues must have been essential to the prior decision; and             
          (5) the controlling facts and applicable legal rules must remain             
          unchanged.  Peck v. Commissioner, supra at 166-167.                          
               The Supreme Court has broadened the scope of collateral                 
          estoppel beyond its common-law limits by abandoning the                      
          requirement of mutuality of the parties, and has conditionally               
          approved the “offensive” use of collateral estoppel by a                     
          plaintiff who was not a party to the prior lawsuit.  See Parklane            
          Hosiery Co. v. Shore, 439 U.S. 322, 331 (1979).  However,                    
          offensive use of collateral estoppel only applies when a                     
          plaintiff seeks to foreclose a defendant from relitigating an                
          issue the defendant previously litigated unsuccessfully in                   
          another action against the same or a different party.  Id. at 326            
          n.4.  Further, the Supreme Court subsequently held that nonmutual            
          offensive collateral estoppel could not be applied to preclude               








Page:  Previous  30  31  32  33  34  35  36  37  38  39  40  41  42  43  44  45  46  47  48  49  Next

Last modified: May 25, 2011