
200 S.E.2d 799 (1973)
284 N.C. 348
H. L. KING, Administrator of the Estate of Byron Sharpe, Deceased,
v.
Ronald K. GRINDSTAFF, Sr., et al.
H. L. KING, Administrator of the Estate of Berlin Sharpe, Deceased,
v.
Ronald K. GRINDSTAFF, Sr., et al.
No. 30.
Supreme Court of North Carolina.
December 12, 1973.
*804 Womble, Carlyle, Sandridge & Rice by W. F. Womble, Winston-Salem, Smith, Moore, Smith, Schell & Hunter by Richmond G. Bernhardt, Jr., Greensboro, for defendant appellant Bradley Lumber Co., Inc.
Deal, Hutchins & Minor by Fred S. Hutchins, Sr., Winston-Salem, for plaintiff appellee.
MOORE, Justice.
The sole question presented on this appeal is whether the trial court erred in allowing plaintiff's motion for summary judgment based on his plea of res judicata, leaving only the issue of damages for trial.
Res judicata deals with the effect of a former judgment in favor of a party upon a subsequent attempt by the other party to relitigate the same cause of action. In Masters v. Dunstan, 256 N.C. 520, 124 S. E.2d 574 (1962), this Court stated:
"`It is fundamental that a final judgment, rendered on the merits, by a court of competent jurisdiction, is conclusive of rights, questions and facts in issue, as to the parties and privies, in all other actions involving the same matter.' Bryant v. Shields, 220 N.C. 628, 18 S.E. 2d 157. `. . . (W)hen a fact has been agreed upon or decided in a court of record, neither of the parties shall be allowed to call it in question, and have it tried over again at any time thereafter, so long as the judgment or decree stands unreversed.' Humphrey v. Faison, 247 N.C. 127, 100 S.E.2d 524, citing and quoting Armfield v. Moore, 44 N.C. 157.

*805 "An estoppel by judgment arises when there has been a final judgment or decree, necessarily determining a fact, question or right in issue, rendered by a court of record and of competent jurisdiction, and there is a later suit involving an issue as to the identical fact, question or right theretofore determined, and involving identical parties or parties in privity with a party or parties to the prior suit. Cannon v. Cannon, 223 N.C. 664, 28 S.E.2d 240; Distributing Co. v. Carraway, 196 N.C. 58, 144 S.E. 535."
See also Shaw v. Eaves, 262 N.C. 656, 138 S.E.2d 520 (1964).
In Federal Court, Alice Sharpe and her daughter Juanita sued the Grindstaffs, driver Lewis, and Bradley for personal injuries sustained as a result of the alleged negligence of Lewis. In that litigation the Sharpes were required to prove that Lewis was negligent and that his negligence was imputable to the Grindstaffs and Bradley under the theory of respondeat superior. To recover under North Carolina's wrongful death statute the plaintiff in the present cases must also prove negligence and imputability. In Federal Court the Sharpes sought recovery for their own personal injuries. The present litigation seeks recovery for the alleged wrongful deaths of Byron and Berlin Sharpe. Hence the causes of action are not identical.
Under a companion principle of res judicata, collateral estoppel by judgment, parties and parties in privity with them  even in unrelated causes of action  are precluded from retrying fully litigated issues that were decided in any prior determination and were necessary to the prior determination. Masters v. Dunstan, supra; Deaton v. Elon College, 226 N.C. 433, 38 S.E.2d 561 (1946); 5 Strong, N.C.Index 2d, Judgments § 35 (1968); 46 Am.Jur.2d, Judgments § 418 (1969). See also Poindexter v. Bank, 247 N.C. 606, 101 S.E.2d 682 (1958); Carver v. Spaugh, 227 N.C. 129, 41 S.E.2d 82 (1947). As stated by Mr. Justice Murphy in Commissioner of Internal Revenue v. Sunnen, 333 U.S. 591, 599, 68 S.Ct. 715, 720, 92 L.Ed. 898, 907 (1948): "[Collateral estoppel] is designed to prevent repetitious lawsuits over matters which have once been decided and which have remained substantially static, factually and legally."
The distinction between res judicata and collateral estoppel or estoppel by judgment was stated by Mr. Justice Field in Cromwell v. County of Sac, 94 U.S. 351, 353, 24 L.Ed. 195, 198 (1877):
". . . The language, therefore, which is so often used, that a judgment estops not only as to every ground of recovery or defense actually presented in the action, but also as to every ground which might have been presented, is strictly accurate, when applied to the demand or claim in controversy. Such demand or claim, having passed into judgment, cannot again be brought into litigation between the parties in proceedings at law upon any ground whatever.
"But where the second action between the same parties is upon a different claim or demand, the judgment in the prior action operates as an estoppel only as to those matters in issue or points controverted, upon the determination of which the finding or verdict was rendered."
This distinction was recognized and approved in Clothing Co. v. Hay, 163 N.C. 495, 79 S.E. 955 (1913); Ferebee v. Sawyer, 167 N.C. 199, 83 S.E. 17 (1914).
To determine whether collateral estoppel applies in the present cases, it must first be decided whether the parties in these suits and those in the former Federal litigation are the same, or stand in privity to the parties in the former litigation. The Federal litigation was between the same defendants and plaintiffs Alice Sharpe and Juanita Sharpe by her next friend H. L. King. H. L. King as next friend for Juanita Sharpe was not a party *806 in the legal sense; rather he was an officer appointed by the court to protect the interest of the minor, the minor being the real party in interest and the real plaintiff. Rabil v. Farris, 213 N.C. 414, 196 S.E. 321 (1938); Krachanake v. Manufacturing Co., 175 N.C. 435, 95 S.E. 851 (1918); George v. High, 85 N.C. 113 (1881). Therefore, the real parties in the Federal litigation were the two Sharpes as plaintiffs with the same three defendants involved in the present cases.
Defendant Bradley contends that although the same defendants are involved in both the Federal and State litigation, the plaintiffs differ in that the plaintiffs in the Federal cases are neither the same parties nor in privity with the plaintiff in this litigation  H. L. King as administrator of the estates of Byron and Berlin Sharpe. Bradley readily concedes that the plaintiffs in the Federal personal injury actions, Alice and Juanita Sharpe, would be the sole beneficiaries of any recovery in the wrongful death actions now before this Court. It asserts, however, that this is not enough to warrant a conclusion that the requirement of identity of parties or parties in privity is met in order for collateral estoppel to be applicable.
Whether or not a person was a party to a prior suit "must be determined as a matter of substance and not of mere form." Chicago, R.I. & P. Ry. v. Schendel, 270 U.S. 611, 618, 46 S.Ct. 420, 423, 70 L.Ed. 757, 763 (1926). "The courts will look beyond the nominal party whose name appears on the record as plaintiff and consider the legal questions raised as they may affect the real party or parties in interest." Davenport v. Patrick, 227 N.C. 686, 44 S. E.2d 203 (1947).
"In an action to recover damages for wrongful death the real party in interest is the beneficiary under the statute for whom recovery is sought, and not the administrator." In re Estate of Ives, 248 N.C. 176, 102 S.E.2d 807 (1958). See also Broadfoot v. Everett, 270 N.C. 429, 154 S. E.2d 522 (1967); Davenport v. Patrick, supra; G.S. 1A-1, Rule 17. Therefore, we conclude that the requirement of identity of parties is met.
In reaching the conclusion that the parties in the Federal litigation and in this litigation are the same, we are not unaware of the rather unique factual situation presented here. Here the only beneficiaries of the Byron and Berlin Sharpe estates  Alice and Juanita Sharpe  were also injured in the accident that gave rise to their personal injury suits against the same three defendants. Had only Alice Sharpe been in the accident with Byron and Berlin Sharpe  unaccompanied by her daughter Juanita  then only Alice Sharpe would have sued in Federal Court for personal injuries and a different factual situation would be presented in this litigation. Thus it is important to note that our holding that the parties in this litigation are the same as those in the Federal litigation is limited to the particular facts in the instant cases.
Having decided that the parties are the same, we must next determine whether another requirement for the application of collateral estoppel  identity of issues  is present. In determining whether collateral estoppel is applicable to specific issues, certain requirements must be met: (1) The issues to be concluded must be the same as those involved in the prior action; (2) in the prior action, the issues must have been raised and actually litigated; (3) the issues must have been material and relevant to the disposition of the prior action; and (4) the determination made of those issues in the prior action must have been necessary and essential to the resulting judgment. 1B Moore's Federal Practice § 0.443[1] (2d Ed.1965). See also Masters v. Dunstan, supra; Ferebee v. Sawyer, supra; Clothing Co. v. Hay, supra; 5 Strong, N.C.Index 2d, Judgments § 35 (1968); 8 Encyclopedic Digest of N.C.Reports, Judgments §§ 364, 412 (1918).
*807 In both the Federal litigation and the present cases the issues determinative of Bradley's liability are the negligence of Lewis and the imputability of Lewis's negligence to Bradley. These material and relevant issues, necessary and essential to the Federal Courts' judgments, were decided against defendant Bradley. The Fourth Circuit Court of Appeals, after setting out facts relating to the relationship of defendants Grindstaffs, Lewis, and Bradley, said: "We think that these facts ineluctably establish that Lewis was no less an employee of the Bradley Lumber Company than of R. K. Grindstaff & Son and that his negligence which brought injuries to the Sharpes is imputable to both." 446 F.2d at 155. That Court then concluded: ". . . [T]he appellants are entitled to judgment against Bradley Lumber Company as well as R. K. Grindstaff & Son." 446 F.2d at 155.
Bradley contends, however, that there was no finding that Lewis, although an employee of Bradley, was acting in the course and scope of his employment at the time of the collision. Before the Circuit Court of Appeals could conclude that both the Grindstaffs and Bradley were liable for the negligence of Lewis, it was compelled to find, as plaintiffs alleged in the complaints, that Lewis was negligent, that his negligence was the proximate cause of plaintiffs' injuries, and that the relationship of master and servant existed between Bradley and Lewis at the time of the injuries and in respect to the very transaction out of which the injuries arose. Jackson v. Mauney, 260 N.C. 388, 132 S.E.2d 899 (1963); Lindsey v. Leonard, 235 N.C. 100, 68 S.E.2d 852 (1952); Graham v. Gas Co., 231 N.C. 680, 58 S.E.2d 757 (1950). See also Southerland v. R.R., 148 N.C. 442, 62 S.E. 517 (1908). While the Federal judgments do not set out in detail the specific fact that Lewis was acting in the scope of his employment at the time of the collision, when a judgment does not set forth in detail the facts found by the court, it is presumed that the court upon proper evidence found the essential facts necessary to support the judgment entered. Craver v. Spaugh, supra; McCune v. Manufacturing Co., 217 N.C. 351, 8 S.E.2d 219 (1940). The crucial issues in the Federal cases were the negligence of Lewis and the liability of the Grindstaffs and Bradley for that negligence. Those issues were there decided against Bradley. When an issue has been directly tried and decided, it cannot be contested again between the same parties or their privies in the same or any other court. Craver v. Spaugh, supra; Bryant v. Shields, 220 N.C. 628, 18 S.E.2d 157 (1942); Clothing Co. v. Hay, supra. "This rule prevails as to matters essentially connected with the subject matter of the litigation and necessarily implied in the final judgment, although no specific finding may have been made in reference thereto. If the record of the former trial shows that the judgment could not have been rendered without deciding the particular matter, it will be considered as having settled that matter as to all future actions between the parties." Craver v. Spaugh, supra.
As stated in 1B Moore's Federal Practice § 0.443[4] (2d Ed.1965):
"[Collateral estoppel's] requirement that an issue must have been determined by adjudication in the prior action is. . . significant . . . in situations in which the issue was undoubtedly raised and litigated in the prior action, but either was not in fact determined or cannot conclusively be shown to have been determined by the resulting judgment. In discovering what issues were determined by the judgment in a prior action, the court in the second action is free to go beyond the judgment roll, and may examine the pleadings and the evidence in the prior action. And if the rendering court made no express findings on issues raised by the pleadings or the evidence, the court may infer that in the prior action a determination appropriate to the judgment rendered was made as to each issue that was so raised *808 and the determination of which was necessary to support the judgment."
See also Gunter v. Winders, 253 N.C. 782, 117 S.E.2d 787 (1961); Southerland v. R. R., supra.
Furthermore, Bradley's contention that this Court should not be bound by the Federal judgments since the Federal Courts erroneously applied North Carolina law and did not follow established rules of Federal procedure ignores an important rule applicable to res judicata and collateral estoppel. To be valid a judgment need not be free from error. Normally no matter how erroneous a final valid judgment may be on either the facts or the law, it has binding res judicata and collateral estoppel effect in all courts, Federal and State, on the parties and their privies. 1B Moore's Federal Practice § 0.405 [4.-1] (2d Ed.1965). See Hampton v. Pulp Co., 223 N.C. 535, 27 S.E.2d 538 (1943); In re Young, 222 N.C. 708, 24 S.E.2d 539 (1943); Smathers v. Insurance Co., 211 N.C. 345, 190 S.E. 229 (1937); 5 Strong, N.C.Index 2d, Judgments § 18 (1968).
While recognizing this principle, we agree with the North Carolina Court of Appeals that the issues determinative of Bradley's liability, including the issue of Lewis's acting within the scope of his employment with Bradley at the time of the accident, were considered by the Federal Courts and answered against Bradley. This conclusion is amply supported by the pleadings and the evidence in the cases in the Federal Courts.
Full faith must be given by State courts to final Federal Court judgments. Therefore, the parties hereto are bound by the judgments in the Federal Courts. Motor Lines v. Johnson, 231 N.C. 367, 57 S. E.2d 388 (1950); Yerys v. Insurance Co., 210 N.C. 442, 187 S.E. 583 (1936); 5 Strong, N.C.Index 2d, Judgments § 38 (1968).
For the reasons stated we hold that the issues of Lewis's actionable negligence and the imputability of his negligence to Bradley were conclusively determined in the Federal Courts between the same parties in interest involved in the present cases. Therefore, the trial court did not err in granting plaintiff's motion for summary judgment and directing that the causes be placed on the jury calendar for the trial on the sole issue of damages.
The decision of the Court of Appeals is affirmed.
Affirmed.
