February 28, 2013
BYRON S. MITCHELL, APPELLANT
ANNIE GALES, APPELLEE.
Appeal from the Superior Court of the District of Columbia (CA2-1246-11) (Hon. Robert S. Tignor, Judge-in-Chambers)
The opinion of the court was delivered by: Easterly, Associate Judge:
Argued November 21, 2012
Before FISHER and EASTERLY, Associate Judges, and KING, Senior Judge.
Byron S. Mitchell appeals
from the denial of his Application for Entry of Administrative
Agency‟s Final Order as Judgment in Superior Court. The order Mr.
Mitchell sought to enter as a judgment was issued
by the Office of Administrative Hearings ("OAH"), which had
adjudicated Mr. Mitchell‟s petition for reduction of rent and had
ordered his landlord, Annie Gales, to pay him $13,014.32.*fn1
The Superior Court denied Mr. Mitchell‟s application to
convert the OAH order into a judgment because it determined that
(1) Ms. Gales had a valid defense of res judicata based on an
earlier-filed Small Claims action, in which Mr. Mitchell had also
prevailed, and (2) representations that Ms. Gales had "likely" become
mentally incompetent*fn2 at some point during the OAH
litigation supplied adequate justification to permit Ms. Gales to
raise this defense for the first time in a collateral proceeding.
The Superior Court‟s ruling was in error. Our law has long been clear that collateral attacks on prior judgments are only permitted where a challenge is made to the original tribunal‟s jurisdiction or an assertion is made that the original order was procured through fraud. Nothing in the record as it stands induces us to relax that rule. Thus, the appropriate forum for Ms. Gales or her representatives to raise incompetence as the reason for her failure to timely challenge the OAH order on res judicata grounds is in the OAH proceedings - not in a collateral attack on the OAH order in Superior Court. Accordingly, we reverse and remand to Superior Court with instructions to enter the OAH order as a judgment.
I.Facts and Procedural History
In 2007, Mr. Mitchell rented an apartment from Ms. Gales for $425 per month. In May 2010, an inspector from the Inspections and Compliance Administration of the District of Columbia Department of Consumer and Regulatory Affairs inspected the unit and determined that it was not habitable due to, inter alia, exposed electrical wires, holes in the walls, a sewage drainage pipe that was not intact, a moldy bathroom floor, bedbugs, and mice. The subsequent dispute between Mr. Mitchell and Ms. Gales over the condition of his apartment and the money he was due in rent refunds and damages spawned litigation in three fora: (1) a law suit in Small Claims court for breach of contract; (2) a proceeding before OAH to litigate his petition for reduction in rent filed with the Rent Administrator; and, (3) lastly, after Mr. Mitchell won in the OAH proceeding, an application in Superior Court to convert his OAH award into a judgment. It is this third proceeding that is now before us on appeal.
Mr. Mitchell first filed a complaint for breach of contract in the Small Claims branch of Superior Court on May 25, 2010 ("the Small Claims Court proceeding"). Shortly thereafter, he filed a petition for reduction in rent due to a reduction in services with the Rent Administrator on June 4, 2010 ("the OAH proceeding"). Ms. Gales was represented by counsel in the Small Claims proceeding, though apparently not in the OAH proceeding. The Small Claims proceeding resolved first when Mr. Mitchell received a $900 judgment on July 15, 2010. Six weeks later, on August 26, 2010, Ms. Gales participated in an oral exam hearing in the Small Claims Court proceeding in order to identify her assets.
More than two months after Mr. Mitchell won a judgment in Small Claims court, the OAH litigation moved forward. An evidentiary hearing in the OAH proceeding was scheduled for October 4, 2010. Ms. Gales failed to appear, but she filed a document with OAH the following day stating that she had been absent because her lawyer told her that the hearing had been scheduled for October 5, 2010.*fn3 OAH construed this note as a motion for a new hearing and rescheduled the evidentiary hearing for December 1, 2010. Ms. Gales again failed to appear, and OAH proceeded in her absence. On January 7, 2011, OAH issued a Final Order. In pertinent part, the order reduced Mr. Mitchell‟s rent by $300 per month for the period of his rental and directed that he be refunded that amount plus interest, a total of $13,014.32.*fn4
After prevailing both in Small Claims Court and before OAH, Mr. Mitchell began the proceeding now before us on appeal ("the Superior Court conversion proceeding"). On February 15, 2011, Mr. Mitchell petitioned Superior Court to enter the OAH order as judgment pursuant to Super. Ct. Civ. R. 12-I (b)(i). At a show cause hearing in front of Judge-in-Chambers (then-Senior Judge John R. Hess) on May 13, 2011, Ms. Gales was represented by counsel and her power of attorney, Tamara Scurlock. Ms. Gales‟s attorney informed the court that he was in the process of filing a motion for relief from a final order in the OAH proceeding because Mr. Mitchell had already had an opportunity in the Small Claims proceeding to litigate his claims against Ms. Gales regarding the habitability of his apartment. In addition, counsel for Ms. Gales informed the court that he had initiated a proceeding to appoint a guardian for Ms. Gales "because of her incapacity now." The court observed that it was up to the administrative agency to rule on the timeliness of Ms. Gales‟s motion for relief and that her claim of res judicata "goes back to the agency," as well. The court then continued the case pending a ruling from OAH on Ms. Gales‟s motion for relief, telling Mr. Mitchell that "if the agency denies . . . any relief from this order, you come back here for entry of the order."
That same day, Ms. Gales, through counsel, filed a Motion for Relief from the Final Order in the OAH proceeding. OAH determined that the motion was untimely filed, however, and denied it on that basis.*fn5 After obtaining an adverse ruling from OAH, Ms. Gales returned to Superior Court on July 1, 2011, and moved under Rule 12(b)(6) to dismiss Mr. Mitchell‟s Application for Entry of Administrative Agency‟s Final Order as Judgment.*fn6
In her motion, Ms. Gales pressed the res judicata defense that
Judge-in-Chambers had previously directed her to litigate before OAH.
In addition, Ms. Gales argued that to convert the OAH award into a
judgment would permit Mr. Mitchell to obtain double recovery.Ms. Gales
explained that she had not raised these defenses in the OAH proceeding
prior to the issuance of the final order from OAH because she "had
been determined to be incapacitated by her medical doctor."*fn7
Ms. Gales cited no authority for the proposition that her
alleged incompetence should excuse her failure to raise these defenses earlier
or allow her to raise them for the first time in a collateral
Mr. Mitchell opposed the motion to dismiss. Citing Strand v. Frenkel, 500 A.2d 1368 (D.C. 1985), he argued that a collateral attack on the merits of an administrative decision is not permitted in an action to enter the administrative order as judgment.*fn8
The motion to dismiss went back to Judge-in-Chambers, but a new judge (Senior Judge Robert S. Tignor) was sitting. Reversing course from the earlier directive that any defenses to Mr. Mitchell‟s administrative petition must be raised before OAH, the court granted Ms. Gales‟s motion to dismiss in a one-page order. The court first determined, without reference to any authority, that Ms. Gales‟s incompetence permitted her to collaterally attack the OAH order. The court did not actually rule that Ms. Gales was legally incompetent. Instead it repeated Ms. Gales‟s contentions that she had been "determined to be incapacitated by her medical doctor" and "that her mental incapacity was likely compromised during summer of 2010," and it noted that these assertions "are essentially uncontested." The Superior Court then determined that it was not too late for Ms. Gales to raise res judicata as a defense to the OAH order, observing that "[t]here appears to be no case law on point from our Court of Appeals." Although the court acknowledged that "it is certainly preferable that a claim of res judicata be presented prior to any subsequent litigation," the court "conclude[d] that Defendant‟s failure to do so within the procedural context of this case does not bar its applicability . . . . Cf. Osei-Kuffnor v. Argana, 618 A.2d 712 (D.C. 1993)."
We review de novo both the dismissal of a claim pursuant to a Rule 12(b)(6) motion and the application of the doctrine of res judicata. Calomiris v. Calomiris, 3 A.3d 1186, 1190 (D.C. 2010). For the reasons discussed below, we conclude that the Superior Court incorrectly determined that Ms. Gales‟s alleged mental incompetence in the OAH proceeding was a sufficient basis to permit her to collaterally attack the OAH order on res judicata grounds. Thus, the Superior Court erred when it dismissed Mr. Mitchell‟s application to enter the OAH order as a judgment.*fn9
It has long been the law in this jurisdiction that a disappointed litigant may not seek relief from an adverse civil judgment by collaterally challenging that judgment in a different forum unless that litigant is challenging the original forum‟s jurisdiction or alleging fraud in the procurement of the judgment in that original forum. Indem. Ins. Co. of N. Am. v. Smoot, 152 F.2d 667 (D.C. Cir. 1945).*fn10 Thus, the D.C. Circuit held in Indemnity that:
It is fundamental that in an action on a judgment the original cause of action cannot be examined on the merits . . . . Moreover, no item of defense may be asserted that existed prior to the judgment and which might have been set up in the original proceedings. Id. at 669.
This court reaffirmed this prohibition on collateral attacks of prior judgments in Strand v. Frenkel, 500 A.2d 1368 (D.C. 1985). Much as in this case, the appellees in Strand had successfully defeated an administrative judgment by collaterally attacking its validity in an enforcement proceeding in Superior Court. We reversed, explaining that the administrative proceeding "finally determines the merits of the claim after final agency action and (if requested) appellate court review." Id. at 1373. Any later court proceeding "to enforce a finally adjudicated liability," by contrast, "[wa]s a new, wholly independent trial court action to enforce, in effect, a final judgment into which the merits of the original claim have merged." Id. Moreover, "[b]ecause of such merger, the underlying merits of the judgment are immune from collateral attack in an enforcement action; principles of claim preclusion (res judicata) bar such inquiry." Id. (citing Henderson v. Snider Bros., Inc., 439 A.2d 481, 485 (D.C. 1981) (en banc); Restatement (Second) of Judgments § 18).
The general prohibition on collateral challenges recognized in
Indemnity and reaffirmed in Strand is essential to the order of our
civil litigation system. This system already incorporates appellate
review as a means of error-correction, and,
to have any value, it must ensure that, at some point, cases end. See
Clement v. District of Columbia Dep't of Human Servs., 629 A.2d 1215,
1218 (D.C. 1993) ("A fundamental principle of litigation that has been
stressed in a variety of contexts is the importance of finality.").
This system also relies heavily on the administrative resolution of
disputes, which is meant, at least in part, to reduce litigation in
the courts.*fn11 To allow parties to re-litigate their
administrative claims in a collateral proceeding in Superior Court
without statutory authorization, however, would supersede this
administrative scheme.*fn12 See Restatement (Second)
of Judgments, ch. 5, intro. note, cmt. a (1982) ("[O]rderly
administration of justice and comity between courts are served by
requiring the applicant to seek relief in the court that rendered the
Notwithstanding this jurisdiction‟s general prohibition on collateral challenges to prior judgments, the Superior Court determined that Ms. Gales could raise a defense of res judicata to the OAH order in a collateral proceeding because it was "essentially uncontested" that "her mental capacity was likely compromised during summer of 2010," i.e., when the OAH proceeding began. Mental incompetence, however, has never been recognized in this jurisdiction as a justification to permit collateral attack in a civil case. See Clement, 629 A.2d at 1218 (finality concerns "may give way where countervailing considerations prevail, but authority must exist in law to override the principle and the legal considerations that have been developed to channel the exercise of such authority must be brought to bear in such situations").
Although this court has never explicitly discussed the effect of a judgment against someone found to be incompetent, the long-standing, uniform view across circuits*fn13 and in state courts*fn14 is that a judgment entered against an incompetent party is not void, but merely voidable. While one might persuasively argue that void judgments should be subject to collateral challenge because, at least in conversion or enforcement proceedings, they implicate jurisdiction-like concerns,*fn15 the merits of voidable judgments "can be corrected only by a direct review and not by bringing another action upon the same cause." Baltimore S.S. Co. v. Phillips, 274 U.S. 316, 325 (1927).
Nothing about the facts of this case persuades us that a new exception to the general rule against collateral attack is needed at this time. It is far from clear based on the record as it stands that Ms. Gales was legally incompetentat all times during the pendency of the OAH proceeding. Mr. Mitchell filed his administrative petition for rent reduction on June 4, 2010, and Ms. Gales was still participating (albeit with the assistance of counsel) in the Small Claims proceeding as of August 26, 2010, the date of the oral exam hearing, without any indication of incompetence. *fn16
Indeed the Superior Court never made a finding that Ms. Gales was legally incompetent during the pendency of the OAH proceeding; it simply observed that Ms. Gales‟s claim that she is "a 78 year old woman . . . determined to be incapacitated by her medical doctor," Dr. Taler, was "essentially uncontested." Dr. Taler, in turn, had stated in his letter submitted to the court that, based on second-hand information from family members, it is "likely" that Ms. Gales‟s cognitive degeneration became "evident" during the summer of 2010.*fn17 Dr. Taler‟s letter seems tailored for submission in a proceeding to prospectively declare Ms. Gales incapacitated and to appoint her a guardian and/or conservator under D.C. Code § 21-2001 to -2098, but it sheds little light on her incompetence during the pendency of the OAH proceeding.*fn18 An individual is presumed both to be competent and to have the capacity to make legal and other decisions, D.C. Code § 21-2002 (d) (2001 & Supp. 2009), and "we are unwilling to infer mental incompetency from the bare fact of old age, infirmity, or inability to manage property." Carter v. Saxon, 358 A.2d 639, 642 (D.C. 1976). Here where Ms. Gales has made only vague, equivocal claims of mental incompetence, we see no reason to create a new exception to our longstanding rule against collateral attack for litigants who may have been incompetent at the time of a prior case.*fn19
Lastly, we note that there is nothing about the nature of the defense Ms. Gales asserted in Superior Court - res judicata - that justifies its litigation in a collateral proceeding. To the contrary, res judicata is an affirmative defense that may be waived. See Stone v. McConkey, 761 A.2d 276, 277 (D.C. 2000) ("[T]he affirmative defense of res judicata . . . is subject[,] like other affirmative defenses[,] to waiver if not raised in the answer or timely asserted thereafter." (citing Group Health Ass'n, Inc. v. Reyes, 672 A.2d 74, 75 (D.C. 1996))). Generally, it must be raised early in the life of a case. See, e.g., Stone, 761 A.2d at 277. Otherwise the point of the doctrine - namely shielding parties from vexatious litigation and freeing judicial resources, see Threatt v. Winston, 907 A.2d 780, 783 (D.C. 2006) (citing Stanton v. District of Columbia Court of Appeals, 326 U.S. App. D.C. 404, 409, 127 F.3d 72, 77 (1997)) - is not fulfilled. Certainly, neither of these objectives is advanced where a party raises a res judicata defense "[a]fter a final judgment has been entered"; thus "it is most unlikely that a court could be persuaded to vacate the judgment so as to permit an assertion that could have been made earlier." 18 Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 4405 (2d ed. 2012) (citing White v. Am. Airlines, Inc., 915 F.2d 1414, 1424 (10th Cir. 1990) (refusing to address in a Rule 60 motion a res judicata defense that could not have been raised at the time of pleading but could have been raised before trial)); see also Bechtold v. City of Rosemount, 104 F.3d 1062, 1068 (8th Cir. 1997) (noting that res judicata cannot be raised for the first time on appeal except to affirm a judgment). Delaying beyond a final judgment and raising a defense of res judicata for the first time in a collateral proceeding is particularly untenable, and we have found no case in which we have endorsed the assertion of a res judicata defense at such a late stage.*fn20 Indeed, in a collateral proceeding, res judicata principles turn against the party seeking to raise it as a defense because the new judgment must now be afforded the same "[r]espect for finality of judgments [that] is deeply ingrained in our legal system." Threatt, 907 A.2d at 784 (quoting Olivarius v. Stanley J. Sarnoff Endowment for Cardiovascular Sci., Inc., 858 A.2d 457 (D.C. 2004)).*fn21
For the reasons set forth above, we conclude that the proper forum for
Ms. Gales to challenge the OAH order is in the OAH action.*fn22
Thus we reverse and remand to Superior Court with
instructions to enter the OAH order, which was final upon its issuance
and has not been stayed, D.C. Code § 2-1831.16 (a) (2001) ("An order
of the Office shall be effective upon its issuance, unless stayed by
an Administrative Law Judge sua sponte or upon motion of any party."),