§408 Compromise and Offers of Compromise

• Library: Evidence Restated Deskbook (2021 Ed.)

§408 Compromise and Offers of Compromise

A. Prohibited uses. Evidence of the following is not admissible on behalf of any party when offered to prove liability for, invalidity of, or the amount of a claim that was disputed as to validity or amount:

1. Furnishing or offering or promising to furnish; or

2. Accepting or offering or promising to accept

a valuable consideration in compromising or attempting to compromise the claim.

B.Permitted uses. The court may admit this evidence for another purpose such as proving bias or prejudice of a witness, negating a contention
of undue delay, or proving an effort to obstruct a criminal investigation or prosecution.

Notes

Missouri caselaw generally prohibits introducing evidence of settlement offers because of the public policy favoring the settlement of disputes. Ullrich v. CADCO, Inc., 244 S.W.3d 772, 780 (Mo. App. E.D. 2008) (and cases cited therein). The public policy rationale underlying the exclusionary rule was explained by the Supreme Court of Missouri:

Such evidence is normally excluded because a party making a settlement offer should not be penalized by revealing an offer to the jury if negotiations fail. Allowing evidence of settlement and negotiation to come before the jury creates a possibility of bias that has no place in our system of justice. The jury could perceive the offering party as admitting guilt or conceding harm and the jury could perceive the refusing party as stubborn, greedy, or mean spirited. The jury could also be confused by a compromise position acceptable for settlement, but less favorable than the result a party might seek at trial.

Hancock v. Shook, 100 S.W.3d 786, 799 (Mo. banc 2003) (citations omitted).

Accordingly, evidence of settlement agreements should be kept from the jury, unless a clear and cogent reason exists for the admission of a particular settlement agreement. Holdeman v. Stratman, 556 S.W.3d 46, 50 (Mo. App. W.D. 2018).

Evidence of "completed compromises" is also inadmissible. Massman Constr. Co. v. Mo. Highway & Transp. Comm'n, 835 S.W.2d 465, 468 (Mo. App. W.D. 1992) ("To admit completed settlement agreements as an admission of liability would frustrate the policy of the law favoring settlements just as surely as would the admission of an offer of settlement.").

The inadmissibility of compromise and offers-of-compromise evidence has also been based on "privilege." See:

· Roush v. Sandy, 871 S.W.2d 98, 101 (Mo. App. W.D. 1994)

· Biermann v. Gus Shaffar Ford, Inc., 805 S.W.2d 314, 325 (Mo. App. S.D. 1991)

· Chase Third Century Leasing Co. v. Williams, 782 S.W.2d 408, 412 (Mo. App. W.D. 1989)

The evidence is inadmissible if it tends to prove liability for, invalidity of, or the amount of a claim that is disputed as to validity or amount. Banks v. Vill. Enters., Inc., 32 S.W.3d 780, 796 (Mo. App. W.D. 2000); A.G. Edwards & Sons, Inc. v. Drew, 978 S.W.2d 386, 392 (Mo. App. E.D. 1998).

The evidence must show a compromise or an attempt to compromise

The exclusionary rule is not implicated if the evidence does not tend to show a compromise or an attempt to compromise, which "requires mutual concessions or a yielding of opposing claims." Holtmeier v. Dayani, 862 S.W.2d 391, 403–04 (Mo. App. E.D. 1993) (installment payments made to the plaintiff were properly admitted because "[n]o evidence suggests that these payments were made with the understanding that [the plaintiff] was to do something in return, which would further a compromise or a settlement nor that she was to consider a compromise of her claim").

Whether the evidence shows a compromise or an attempt to compromise is a question for the court. St. Louis Cty. v. River Bend Estates Homeowners' Ass'n, 408 S.W.3d 116, 128 (Mo. banc 2013) (there was no abuse of discretion in excluding evidence of an out-of-court statement by a property owner, made in answer to the condemnation commissioners' question regarding the value of the land, that the value of the property was $496,000, because the trial court was free to conclude that the statement was a statement of the property owner's position regarding the amount that he would have taken to settle the case during settlement negotiations and not a statement of his opinion about the value of the property); Tripp v. Harryman, 613 S.W.2d 943, 949–50 (Mo. App. S.D. 1981) ("Even though the plain language of the agreement arguably may not explicitly evidence an intent of the parties to compromise the dispute, the admissibility of evidence is a matter within the discretion of the trial judge."); Maugh v. Chrysler Corp., 818 S.W.2d 658, 660–61...