Justice Prevails: Integrity Beats Gotcha

Courts encourage parties to narrow the issues and to stipulate to facts and other matters that are not a disputed issue. These stipulations make for a quicker trial saving the court time and the parties both time and money. In a recent Fourth District Court of Appeal case, the Court slapped down a party for engaging in a game of “gotcha” by reneging on a stipulation. The trial court abused its discretion when it allowed the defendant insurance company to get away with it.

The opinion begins with an attention-getting line — “This appeal pits ‘integrity’ in the practice of law against an unwarranted game of ‘gotcha.'” Fortunately, integrity won out over gotcha on appeal although not at the trial court level.  In the pretrial stipulation, in several pretrial hearing, and in the opening statement, counsel for the defendant insurer agreed that the only issue was  the amount of damages owed to the insured, which had acquired its rights by assignment.  The pretrial specifically stated: “[The assignor] assigned its rights to the insurance proceeds [the purchaser] on December 23, 2005.” Thus, the parties specifically agreed to the fact of the assignment.

Nevertheless, after the plaintiff rested its case, counsel for the insurer moved for a directed verdict and argued that the plaintiff had failed to prove the existence of the assignment.  Plaintiff’s counsel reminded the court of the stipulation and the motion was denied. The motion was renewed at the close of all the evidence, and was again denied.

Persistence paid off though at the meeting to discuss the jury instructions (i.e., the charge conference).  Insurance counsel asserted that the issue of the assignment was a “question of fact for the jury.”  This time the trial judge disregarded the argument that the fact of the assignment had been stipulated and allowed the jury to be instructed that it should determine whether a valid assignment had been made to the Plaintiff.  Not surprisingly, because there had been no evidence of an assignment due to the stipulation, the jury found there was no assignment and ruled for the insurance company.  The trial court refused to grant a new trial when the Plaintiff requested one. Fortunately, the Fourth DCA reversed this travesty of justice on appeal, and reaffirmed the binding nature of stipulations and that once a fact is stipulated no proof of it is required.

I would like to say this has never happened to me.  Unfortunately, this or something similar happens all too often. Early in my career I had defense counsel try a nearly identical “gotcha” on me.  They stipulated to the liability of a vicariously liable defendant.  That is, if the actively liable defendant was guilty, then the vicariously liable defendant was liable.  After I rested my case, opposing counsel argued that I had failed to prove the vicariously liable defendant owned the car and lent it to the actively liable defendant.  When I said that I would reopen my case and present that evidence and the judge said he would allow me to, insurance counsel capitulated on that issue.

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