The Court's analysis is useful broadly.
Res judicata, which includes both issue estoppel and cause of action estoppel, serves as an equitable estoppel to ensure justice is done, prevent abuse of process, and fulfill the societal interest of finalizing litigation. That which has been finally decided by a court of competent jurisdiction is not to be reconsidered absent fraud on the court.
Mintzer v. Canada, 2004 FC 1289 (CanLII), 2004 FC 1289 provides a concise statement of the principle that res judicata is not limited to what is actually decided in litigation but also includes that which reasonably where part of the litigation:
Res Judicata is not confined to the issues which the court is actually asked to decide, but also covers issues and facts that are clearly part of the subject matter of prior litigation and so could have been raised. Hence, it would be an abuse of the process of the Court to allow a new proceeding on those issues or facts.
The Court in Fournogerakis held:
Res Judicata
[16] Where it applies, res judicata serves as an equitable estoppel. Its purpose is to ensure justice is done, prevent abuse of process, and fulfill the societal interest of finalizing litigation. The court retains a discretion to refuse to apply the principle where in special circumstances a rigid application would frustrate its purpose: Arnold v. National Westminster Bank Plc., [1991] 2 A.C. 93 (H.L.) at 109111.
[17] In Farwell v. Canada (Attorney General) (1894), 22 S.C.R. 553 at 558, the Supreme Court recognized what may be said to be the two branches of the principle cause of action and issue estoppel:
Where the parties (themselves or privies) are the same, and the cause of action is the same, the estoppel extends to all matters which were, or might properly have been, brought into litigation. Where the parties (themselves or privies) are the same, but the cause of action is different, the estoppel is as to matters which, having been brought in issue, the finding upon them was material to the former decision.
[18] While the judge did not say so, the concern here is whether the former, cause of action estoppel, arises whether the cause of action in the first action is the same as in this action. It is not suggested any particular question was resolved in the first action that is raised in this action giving rise to issue estoppel.
[19] This Court considered cause of action estoppel recently in Mohl v. University of British Columbia, 2006 BCCA 70 (CanLII), 2006 BCCA 70, 52 B.C.L.R. (4th) 89, which was concerned with a judicial review of an administrative decision and a subsequent action in relation to the same matter. There, at paragraph 23, reliance was placed on the principle as stated in the House of Lords in Arnold at 104:
Cause of action estoppel arises where the cause of action in the later proceedings is identical to that in the earlier proceedings, the latter having been between the same parties or their privies and having involved the same subject matter. In such a case the bar is absolute in relation to all points decided unless fraud or collusion is alleged, such as to justify setting aside the earlier judgment.
[20] What constitutes a cause of action was stated by the Supreme Court in Danyluk v. Ainsworth Technologies Inc., 2001 SCC 44 (CanLII), 2001 SCC 44, 2001 SCC 44 (CanLII), [2001] 2 S.C.R. 460 at para. 54:
A cause of action has traditionally been defined as comprising every fact which it would be necessary for the plaintiff to prove, if disputed, in order to support his or her right to the judgment of the court: Poucher v. Wilkins (1915), 33 O.L.R. 125 (C.A.). Establishing each such fact (sometimes referred to as material facts) constitutes a precondition to success.
[21] In Mohl, its meaning was defined at paragraph 24:
The meaning of cause of action in this context is clear. In Letang v. Cooper (1964), [1965] 1 Q.B. 232 (Eng. C.A.) at 242-43, Diplock L.J. said, A cause of action is simply a factual situation the existence of which entitles one person to obtain from the court a remedy against another person. In Johnson v. Refuge Assurance Co. Ltd. (1912), [1913] 1 K.B. 259, 82 L.J.K.B. 411 (Eng. C.A.) at 264, Kennedy L.J. said that the word action in its usual meaning refers to any proceeding in the nature of a litigation between a plaintiff and a defendant.
[22] It is then where the factual situation material to the determination sought in the first action is the same as the factual situation material to whatever determination may be sought in the second action that the estoppel arises. The principle does not apply to distinct causes of action: Lehndorff Management Ltd. v. L.R.S. Development Enterprises Ltd. (1980), 109 D.L.R. (3d) 729 at 734, 19 B.C.L.R. 59 (C.A.), citing in particular Hall v. Hall (1958), 15 D.L.R. (2d) 638 (Alta. C.A.). It is not that litigants have to raise every cause of action they may have against each other in one action to avoid the estoppel being raised in another later action; rather it is they must exhaust reliance on any given cause of action any one series of material facts in an action where such facts are first put in issue and adjudicated upon. Generally, a cause of action can only be raised and adjudicated upon once. The focus of the inquiry is on whether the material facts on which the determinations sought in any two actions are the same.
James Morton
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