OCTOBER TERM, 1995
Syllabus
certiorari to the supreme court of alabama
No. 95-386. Argued March 26, 1996—Decided June 10, 1996
Petitioners, who are privately employed in Jefferson County, filed a state-court class action claiming that the county's occupation tax violates the Federal and Alabama Constitutions. In granting the county partial summary judgment, the trial court found that petitioners' state claims were barred by a prior adjudication of the tax in an action brought by Birmingham's acting finance director and the city itself, consolidated with a suit by three county taxpayers, see Bedingfield v. Jefferson County, 527 So. 2d 1270, but that petitioners' federal claims had not been decided in that case. The county and respondent intervenor argued on appeal that the federal claims were also barred. The State Supreme Court agreed, concluding that res judicata applied because petitioners were adequately represented in the Bedingfield action.
Held: Because petitioners received neither notice of, nor sufficient representation in, the Bedingfield litigation, that adjudication, as a matter of federal due process, may not bind them and thus cannot bar them from challenging an allegedly unconstitutional deprivation of their property. Pp. 797-805. (a) The traditional rule that an extreme application of state-law res judicata principles may be inconsistent with the Federal Constitution, see Postal Telegraph Cable Co. v. Newport, 247 U. S. 464, 476, reflects the general consensus that one is not bound by a judgment in litigation to which he is not a party. Of course, there is an exception from these principles when there is "privity" between a party to the second case and a party who is bound by an earlier judgment. Pp. 797-799. (b) Because the Bedingfield parties gave petitioners no notice that a suit was pending which would conclusively resolve their legal rights, that proceeding would have a binding effect on them, as absent parties, only if it were so devised and applied as to ensure that those present were of the same class as those absent and that the litigation was so conducted as to ensure the full and fair consideration of the common issue. Hansberry v. Lee, 311 U. S. 32, 43. Because the Bedingfield action plainly does not fit this description, there is no reason to suppose that the court therein took care to protect petitioners' interests in the manner suggested in Hansberry or that the Bedingfield plaintiffs understood their suit to be on behalf of absent taxpayers. Those plaintiffs
793
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