§ 14.02 Rationale

• Jurisdiction: United States

§ 14.02 Rationale

Offers to settle lawsuits would quickly disappear if the other party could reject the offer but then use it as evidence. In the absence of a provision such as Rule 408, the offer would be admissible as a statement ("admission") of a party-opponent.³ As the drafters commented, it is the "promotion of the public policy favoring the compromise and settlement of disputes" that underlies Rule 408.⁴

A secondary rationale turns on relevancy: "The evidence is irrelevant, since the offer may be motivated by a desire for peace rather than from any concession of weakness of position. The validity of this position will vary as the amount of the offer varies in relation to the size of the claim and may also be influenced by other circumstances."⁵ As this last sentence suggests, the relevancy argument would not justify a blanket rule such as Rule 408. In a million-dollar lawsuit, a settlement offer of $12,000 may be an attempt to "buy peace" because it would cost far more to hire attorneys. However, an $800,000 offer suggests a real concern that the suit has merit.

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Notes:

^[3] If the offer was made by the party, it would be an individual admission. Fed. R. Evid. 801(d) (2)(A). If made by the party's attorney, it would be an authorized admission. Fed. R. Evid. 801(d) (2)(C). See infra chapter 32 (discussing hearsay exemptions).

^[4] Fed. R. Evid. 408 advisory committee's note. See also Lyondell Chemical Co. v. Occidental Chemical Corp., 608 F.3d 284, 294-95 (5th Cir. 2010) ("[T]he rule's exclusion of settlement evidence furthers public policy by promoting the voluntary settlement of...