Litton ABS v. Red-Yellow Cab Co.

In a prior suit brought by plaintiffs assignee against the present defendant (appellant), no defense was raised. In the present case, the defendant counterclaimed against the plaintiff setting forth facts which would have constituted a defense, if raised, in the prior action between the assignee and the defendant. In the present action, plaintiff successfully interposed the defense of res judicata. We hold that the defense of res judicata is not available in this case and, in so doing, reverse the trial court.

In March of 1971, Litton ABS and Red-Yellow Cab entered into a written agreement for…