Collateral estoppel — issue preclusion — prohibits the re-litigation of certain issues. Similarly, res judicata — claim preclusion — prohibits the re-litigation of claims.
In order for a claim to be barred by res judicata, the following factors must be met: 1) identity of the thing sued for; 2) identity of the cause of action; 3) identity of the persons and parties to the action; and 4) identity of the quality of the person for or against whom the claim is made. Suppose an individual sued a car manufacturer alleging that the car was manufactured improperly (product liability), and thus caused harmed in a car accident that should not have been caused. Suppose the car manufacturer wins and the Judge/Jury finds that the car was not manufactured improperly. If another passenger in the car, in turn, files a new suit against the car company making the same allegations, what is the result? Based on the elements of res judicata, it may very bar the claim because the issues and claims had already been decided.
The polices behind res judicata (and collateral estoppel, for that matter) are to relieve parties of the cost and vexation of multiple lawsuits, conserve judicial resources, and encourage reliance on adjudications.
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