Supreme Court of the United States - 311 U.S. 32, 61 S.Ct. 115, 311 U.S. 32, 85 L. Ed. 22, 61 S. Ct. 115, 1940 U.S. LEXIS 108, SCDB 1940-006
In the 1940 case, Hansberry v. Lee, the U.S. Supreme Court addressed res judicata and due process in class action lawsuits. The situation involved African-American residents of Chicago, including Hansberry, fighting against a racially restrictive covenant that banned them from buying or leasing land in a certain area. Despite a previous legal case where the covenant was upheld, Hansberry argued it was not valid due to insufficient signatures. Lower courts held that Hansberry was bound by the previous judgment, but he appealed.
The Supreme Court ruled that Hansberry was not bound by the previous judgment, allowing him to challenge the covenant. The court established a test for adequate representation in class actions, ensuring the right to due process under the Fourteenth Amendment. The test required that parties in a class action have aligned interests with absent class members and that they protect those interests during litigation. This standard was not met in Hansberry's case.
This case has lasting significance because it formed and applied the principles of res judicata and due process in class action lawsuits, distinguishing between different types of class members based on their interests and representation. It also demonstrated how the court weighs the values of finality and efficiency with fairness and justice when determining the binding effect of judgments. The case remains a key authority on this topic today.
This case involves a dispute over a restrictive agreement that prohibited the sale, lease, or occupation of land by people of color in a specific area of Chicago. The Supreme Court of Illinois held that the petitioners were members of the class represented by the plaintiffs in an earlier suit and were therefore bound by its decree. However, the court found that the procedure adopted did not ensure the protection of the interests of absent parties who were to be bound by it, and therefore, the plea of res judicata was not sustained. The representation in this case does not satisfy the requirements of due process and is akin to a trial by a judicial officer who may have an interest in the outcome of the litigation in conflict with that of the litigants. The lower court erred in ruling that the issue of performance of the condition precedent to the validity of the agreement was res judicata and entered a decree for the respondents.
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