Morse Brothers Inc. v. Mason
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MAINE SUPREME JUDICIAL COURT					Reporter of Decisions
Decision:	2001 ME 5
Docket:	And-00-326
Submitted
on Briefs:	November 21, 2000
Decided:	January 9, 2001

Panel:WATHEN, C.J., and CLIFFORD, RUDMAN, SAUFLEY, ALEXANDER, and
	CALKINS, JJ.

MORSE BROTHERS, INC.

v.

BARBET MASON et al.{1}

WATHEN, C.J.

	[¶1]  Morse Brothers, Inc. appeals from the judgment entered in the
Superior Court (Androscoggin, Delahanty, J.) dismissing its claims against
the Trustees of the Maine Motor Transport Association Workers'
Compensation Trust as barred by the prior litigation between the parties. 
On appeal, Morse Brothers argues that neither res judicata, accord and
satisfaction, nor their failure to assert a counterclaim in the prior action bars
the present litigation.  We conclude that the present claims are barred as
omitted compulsory counterclaims in the prior action.  
	[¶2]  The underlying facts may be summarized as follows:  The Maine
Motor Transport Workers' Compensation Trust is a Maine Workers'
Compensation Trust established for Workers' Compensation self-insurance
purposes.  Morse Brothers participated as a member of the Trust from 1993
to 1997.  In 1994, the Trustees adopted a policy to prohibit the payment of
refunds to members who have departed the Trust.  If the refund is declared
after the member has left the trust, the policy applies even though the
refund relates to a year in which the departed member participated fully.  In
the present case, the Trustees declared refunds for 1995 and 1997 after
Morse Brothers had withdrawn from the Trust.  Morse Brothers did not
receive any portion of these refunds even though they participated in the
Trust during the two years in question. 
	[¶3]  In 1998, the Trust sued Morse Brothers for unpaid premiums
and other assignments that were incurred while they participated in the
Trust.   Morse Brothers denied the Trustees' claims and initially asserted
nine affirmative defenses, including one for a setoff against any amount owed
for the amount of the refunds that Morse Brothers had not received.  Seven
months later, Morse Brothers moved to amend its answer and assert
counterclaims relating to the unpaid refunds, but the Superior Court denied
the motion because Morse Brothers could have asserted its counterclaims
earlier.  The parties subsequently settled the case and stipulated to a partial
dismissal with prejudice of all of the Trust's claims against Morse Brothers
except for a claim for attorney fees.  Morse Brothers subsequently initiated
the present suit to recover the unpaid refunds. 
	[¶4]  The Trustees argue that the Superior Court was correct in
dismissing Morse Brothers's claims because, as compulsory counterclaims in
the prior litigation, they are barred by the dismissal of the prior action.{2} 
Morse Brothers, however, counters that its claims were not compulsory
counterclaims because their resolution would have required factual findings
and legal conclusions distinct from those in the prior proceeding.  The legal
sufficiency of a complaint challenged by a motion to dismiss is a question of
law that we review de novo.  Hawley v. Murphy, 1999 ME 127, ¶ 5, 736 A.2d
268, 270. 
	[¶5]  Under principles analogous to res judicata, a defendant who
fails to assert a compulsory counterclaim, as required by Rule 13(a) of the
Maine Rules of Civil Procedure, "is precluded from later maintaining
another action on the claim after rendition of judgment."  KeyBank Nat'l.
Ass'n. v. Sargent, 2000 ME 153, ¶ 17, 758 A.2d 528, 534 (quoting Bartlett
v. Pullen, 586 A.2d 1263, 1265 (Me. 1991)).  Rule 13(a) provides in part:

	(1) Pleadings.  Unless otherwise specifically provided by
statute . . . a pleading shall state as a counterclaim any claim
which at the time of serving the pleading the pleader has
against any opposing party, if it arises out of the transaction
or occurrence that is the subject matter of the opposing
party's claim . . . .  

M.R. Civ. P. 13(a)(1).  In deciding whether the facts of a controversy
constitute a "transaction or occurrence," we consider "whether the facts
are related in time, space, origin, or motivation, whether they form a
convenient trial unit, and whether their treatment as a unit conforms to the
parties' expectations or business understanding or usage."  KeyBank Nat'l.
Ass'n., 2000 ME 153, ¶ 17, 758 A.2d at 534 (quoting DiPietro v. Boynton,
628 A.2d 1019, 1022 (Me. 1993)).  In the present case, Morse Brothers's
claims were compulsory counterclaims in the prior action because they
arose from the same "transaction or occurrence" that was the subject
matter of the Trust's prior claims: Morse Brothers's obligations and
entitlements arising from its membership in and separation from the Trust. 
Because Morse Brothers did not properly assert these claims in the prior
action, Rule 13(a)(1) now bars it from doing so in the present case. 
	The entry is:
Judgment affirmed.
                                                                         
Attorney for plaintiff:

Susan E. Oram, Esq.
Bonneau & Geismar, LLC
P O Box 7230
Lewiston, ME 04243-7230

Attorneys for defendants:

John P. McVeigh, Esq.
Evan Hansen, Esq.
Preti Flaherty Beliveau & Pachios, LLC
P O Box 9546
Portland, ME 04112-9546