Clemens v. Apple

Issue Discussed: Res Judicata / Collateral Estoppel

Submitted by Aluyah I. Imoisili, Jamie E. Sutton*

Date Promulgated: June 11, 1985

Clemens v. Apple, 481 N.E.2d 560 (N.Y. 1985)

Court: Court of Appeals of New York

Issues Decided: Whether a court may apply collateral estoppel on issues relevant to a court action that have been determined in a prior arbitration.

Key Holding

The plaintiff brought a negligence action arising from the automobile accident wherein he allegedly suffered a herniated disc.  The plaintiff also demanded arbitration against his automobile insurer that had refused to pay his claim.  The arbitration panel ruled that the plaintiff’s disc injury was not caused by the automobile accident.  Based on this decision, and the trial court held that the plaintiff was collaterally estopped from relitigating the issue of what caused his automobile accident.

The Court of Appeals affirmed the trial court’s decision.  The Court of Appeals held that an arbitration panel’s finding on an issue has a collateral estoppel effect because the plaintiff had “full and fair opportunity to litigation the issue.”  The Court of Appeals noted that plaintiff, who had been represented by counsel throughout, should have been aware of the possibility that the result of the arbitration would affect a pending court proceeding addressing, in part, the identical issue presented at arbitration.

Key Takeaways

A court will accord collateral estoppel effect in a court action to issues determined by a prior arbitration panel.

* Aluyah I. Imoisili is a Partner and Jamie E. Sutton is an Associate at Greenberg Gross LLP, where they specialize in commercial litigation and arbitration.