New Jersey’s Dangerous “Entire Controversy Doctrine”

New Jersey common law employs an equitable doctrine known as the “Entire Controversy Doctrine” (ECD), which can be a trap for the unwary and used as a secret weapon to destroy subrogation claims.

Similar to other states’ prohibitions against “splitting” a cause of action, this doctrine bars a party from commencing multiple lawsuits arising out of a single event or transaction.

This doctrine requires joinder in one action of all legal and equitable claims related to a single underlying transaction. Manhattan Woods Golf Club, Inc. v. Arai, 711 A.2d 1367 (N.J. App.), cert. denied, 156 N.J. 411 (1998).

It is an equitable doctrine that is based on “the principle that the adjudication of a legal controversy should occur in one litigation in only one court; accordingly, all parties involved in a litigation should at the very least present in that proceeding all of their claims and defenses that are related to the underlying controversy.” Cogdell v. Hosp. Center at Orange, 116 N.J. 7 (1989).