Insurance Litigants Only Get One Bite of the Apple


When Insured’s Assignee Loses in South Dakota He May Not Sue in Minnesota

Assignment of a Claim Where there is no Coverage is Valueless

After being seriously injured in a car accident in Worthington, Minnesota, appellant Alaaldeen Mussa sued the driver for negligence. When it became clear that the driver was unable to pay Mussa’s medical bills, Mussa instead sought satisfaction of his claim from the driver’s insurance provider, respondent Western Agriculture Insurance Company (Western Agriculture), in Minnesota district court. Western Agriculture then brought a declaratory-judgment action in South Dakota district court to determine whether there was coverage under the terms of the driver’s insurance policy. After a two-day trial, the South Dakota district court determined-and the South Dakota Supreme Court later affirmed- that the policy did not provide coverage. Unhappy with the result of his appeal to the South Dakota Supreme Court he tried to try his case again in Minnesota.

In Alaaldeen Mussa v. Western Agricultural Insurance Company, et al., No. A21-0099, Court of Appeals of Minnesota (September 13, 2021) the trial court concluded that having prevailed in South Dakota, Western Agriculture was entitled to have that judgment granted full faith and credit in Minnesota.


In fall 2013, Altayeb Arbab-Azzein and appellant Alaaldeen Mussa, both South Dakota residents working in Minnesota, were involved in a car accident near Worthington, Minnesota. Arbab-Azzein had been driving Mussa and at least thirteen other coworkers to a manufacturing plant in Worthington when he crashed. Mussa suffered significant injuries and sued Arbab-Azzein in Minnesota district court for negligence. At the time of the accident, Arbab-Azzein was insured by respondent Western Agriculture. But after learning of the crash, Western Agriculture denied coverage.

Mussa and Arbab-Azzein entered into a Miller-Shugart agreement. [Miller v. Shugart, 316 N.W.2d 729 (Minn. 1982)]. In doing so, Arbab-Azzein stipulated to judgment in favor of Mussa in the amount of $1,500,000, and Mussa agreed to seek satisfaction of that judgment from Western Agriculture’s policy. After the agreement, Mussa then sued Western Agriculture in Minnesota district court for breach of contract, bad faith refusal to settle, and negligent procurement of insurance coverage.

Instead of proceeding in the Minnesota action Western Agriculture obtained a declaratory judgment against Arbab-Azzein and Mussa in South Dakota. Despite his pending Minnesota claim, Mussa appeared and fully participated in the South Dakota action. The South Dakota district court determined that Western Agriculture had no contractual obligation to defend or indemnify Arbab-Azzein for claims arising out of the motor vehicle accident. Mussa appealed this decision, but the South Dakota Supreme Court affirmed.

No further action was taken on Mussa’s Minnesota claim until March 2020 after the South Dakota Supreme Court ruled in favor of the insurer.


Mussa’s central argument is that the district court erred by granting full faith and credit to the South Dakota judgment. Because the accident happened in Minnesota and the claim was brought in Minnesota district court, Mussa asserts that Minnesota law should apply. He further asked the appellate court to conclude that, applying Minnesota law, Western Agriculture is liable for satisfaction of the stipulated judgment in the amount of $1,500,000.

The district court did not err by granting full faith and credit to the South Dakota judgment.

Generally, “full faith and credit shall be given in each state to the public acts, records, and judicial proceedings of every other state.” U.S. Const. art. IV, § 1. A foreign judgment so filed has the same effect and is subject to the same procedures, defenses and proceedings for reopening, vacating, or staying as a judgment of a district court or the supreme court of this state, and may be enforced or satisfied in like manner. Exceptions to the grant of full faith and credit exist. A challenge to the enforceability of a foreign judgment cannot be used to collaterally attack that judgment on its merits. And, where the parties submitted to the jurisdiction of the original forum, the parties cannot subsequently challenge personal jurisdiction.

Mussa conceded that South Dakota had proper jurisdiction over the parties and the action and does not dispute that he had the opportunity to fully participate in that case.

Although both claims were ongoing, Mussa’s Minnesota district court claim remained dormant during the South Dakota proceedings.Since Mussa did not allege, and the record did not suggest, that the South Dakota courts lacked jurisdiction, or that the judgment was obtained fraudulently or was already satisfied, or that Mussa’s due-process rights were violated his arguments were inadequate and  the district court did not err by granting full faith and credit to the South Dakota judgment.

Res judicata and collateral estoppel preclude Mussa’s remaining arguments.

In his remaining claims, Mussa asserts that, under Minnesota law, Western Agriculture is liable for satisfaction of the judgment pursuant to the Miller-Shugart agreement reached by Arbab-Azzein and Mussa.

However, res judicata bars subsequent litigation of a claim when:

  1. the earlier claim involved the same set of factual circumstances;
  2. the earlier claim involved the same parties or their privies;
  3. there was a final judgment on the merits; and
  4. the estopped party had a full and fair opportunity to litigate the matter.

Res judicata applies to claims actually litigated and claims that could have been litigated in the earlier action. Collateral estoppel is narrower in scope and bars relitigation of a specific issue. A party is collaterally estopped from relitigating an issue when the issue is identical to one in a prior adjudication; there was a final judgment on the merits; the estopped party was a party or in privity with a party to the prior adjudication; and the estopped party had a full and fair opportunity to be heard on the issue.

Here, the South Dakota judgment involved the same factual circumstances at issue in Mussa’s Minnesota district court claim: Mussa, injured in a car accident, sought satisfaction of a stipulated judgment in the amount of $1,500,000 from Western Agriculture, the driver’s insurance provider. The precise issue was raised in both courts: whether Mussa was entitled to coverage under Arbab-Azzein’s insurance policy. The South Dakota judgment was final and was affirmed by the South Dakota Supreme Court.

Finally, Mussa had the opportunity to fully and fairly participate in the South Dakota litigation-even going so far as to appeal the judgment to the South Dakota Supreme Court. Because the elements of res judicata and collateral estoppel were met, Mussa was precluded from relitigating his claims concerning Western Agriculture’s liability in Minnesota district court.


A $1,500,000 stipulated judgment that became uncollectable resulted in the temptation to try a court in the scene of the accident. It failed because the assignee participated in the trial and eventual appeal in the Supreme Court of South Dakota. Mussa lost in a fully litigated and appellate honored case and lost again when he tried to bring the same action to another court. The Constitutional right requiring one state’s court to give full faith and credit to the judgment of a sister state is impossible to overcome. When a party loses a suit in one state he has no right to try again in another court.

© 2021 – Barry Zalma

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders.

He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 54 years in the insurance business.

He is available at and Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award. Over the last 53 years Barry Zalma has dedicated his life to insurance, insurance claims and the need to defeat insurance fraud. He has created the following library of books and other materials to make it possible for insurers and their claims staff to become insurance claims professionals.

Go to the podcast Zalma On Insurance at;  Follow Mr. Zalma on Twitter at; Go to Barry Zalma videos at at; Go to Barry Zalma on YouTube-; Go to the Insurance Claims Library –  The last two issues of ZIFL are available at  podcast now available at

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