CACI 222 Evidence of Sliding-Scale Settlement

California Civil Jury Instructions CACI

222 Evidence of Sliding-Scale Settlement

You have heard evidence that there was a settlement agreement between [name of settling defendant] and [name of plaintiff].

Under this agreement, the amount of money that [name of settling defendant] will have to pay to [name of plaintiff] will depend on the amount of money that [name of plaintiff] receives from [name of nonsettling defendant] at trial. The more money that [name of plaintiff] might receive from [name of nonsettling defendant], the less that [name of settling defendant] will have to pay under the agreement.

You may consider evidence of the settlement only to decide whether [name of settling defendant/name of witness] [, who testified on behalf of [name of settling defendant],] is biased or prejudiced and whether [his/her/nonbinary pronoun] testimony is believable.

Directions for Use

Use this instruction for cases involving sliding scale or “Mary Carter” settlement agreements if a party who settled appears at trial as a witness. A “Mary Carter” agreement calls for the settling defendant to participate in the trial on the plaintiff’s behalf, and provides for a settling defendant to be credited for amounts the plaintiff recovers from nonsettling defendants. It is secret and raises concerns of collusion and the potential for fraud. The interests of the parties are realigned in a manner not apparent to the trier of fact. (Diamond v. Reshko (2015) 239 Cal.App.4th 828, 843, fn. 7 [191 Cal.Rptr.3d 438].)

The court must give this instruction on the motion of any party unless it finds that disclosure will create substantial danger of undue prejudice, of confusing the issues, or of misleading the jury. (Code Civ. Proc., § 877.5(a)(2).)

If the settling defendant is an entity, insert the name of the witness who testified on behalf of the entity and include the bracketed language in the third paragraph.

See CACI No. 217, Evidence of Settlement. See also CACI No. 3926, Settlement Deduction.

Sources and Authority

Evidence of Settlement. Code of Civil Procedure section 877.5(a)(2).

“[W]hen a defendant is a party to a sliding scale settlement, which is also called a ‘Mary Carter’ agreement, that agreement must be disclosed to the jury if the settling defendant testifies at trial, unless the court finds that the disclosure will create a substantial danger of undue prejudice.” (Diamond, supra, 239 Cal.App.4th at p. 843.)

Evidence of a settlement agreement is admissible to show bias or prejudice of an adverse party. Relevant evidence includes evidence relevant to the credibility of a witness. (Moreno v. Sayre (1984) 162 Cal.App.3d 116, 126 [208 Cal.Rptr. 444].)

Evidence of a prior settlement is not automatically admissible. “Even if it appears that a witness could have been influenced in his testimony by the payment of money or the obtaining of a dismissal, the party resisting the admission of such evidence may still appeal to the court’s discretion to exclude it under section 352 of the code.” (Granville v. Parsons (1968) 259 Cal.App.2d 298, 305 [66 Cal.Rptr. 149].)

Secondary Sources

5 Witkin, Summary of California Law (11th ed. 2017) Torts, § 211
5 Levy et al., California Torts, Ch. 74, Resolving Multiparty Tort Litigation, § 74.27 (Matthew Bender)
3 Matthew Bender Practice Guide: California Pretrial Civil Procedure, Ch. 37, Settlement and Release, 37.25
25 California Forms of Pleading and Practice, Ch. 300, Indemnity and Contribution, § 300.73[10] (Matthew Bender)
46 California Forms of Pleading and Practice, Ch. 520, Settlement and Release, § 520.16[3] (Matthew Bender)