Ponderosa Timber & Clearing Co. v. Emrich

472 P.2d 358, 86 Nev. 625, 1970 Nev. LEXIS 582

• Court: Nevada Supreme Court
• Decided: July 20, 1970
• Docket: 6070
• Status: Published

Opinions

OPINION

By the Court,

Thompson, J.:

In this personal injury action the jury favored the plaintiffs with its verdict in the sum of $35,000 against all defendants, Ponderosa Timber, Crystal Bay Development, California Liquid Gas and its employee Atwood. Judgment was duly entered. Two of the defendants, Ponderosa and Crystal Bay, moved for a new trial contending that an undisclosed pre-trial agreement between counsel for the plaintiffs on the one hand, and the insurance carrier for the codefendants Liquid Gas and Atwood on the other, caused the trial to be unfair. That motion was denied. Ponderosa and Crystal Bay have appealed from the judgment and from the order denying a new trial.

The mentioned pre-trial agreement guaranteed the plaintiffs $20,000, subject to the following conditions: (a) if the plaintiffs lose at trial, or obtained judgment only against Liquid Gas and Atwood, the insurance carrier for Liquid Gas would pay $20,000; (b) if the plaintiffs secure judgment against all defendants, or any of them, for less than $20,000, the plaintiffs would look to Ponderosa and Crystal Bay for satisfaction, and the insurance carrier for Liquid Gas would pay the difference between the judgment and $20,000; (c) if the plaintiffs obtain judgment against all defendants in excess of $20,000, the plaintiffs would look solely to Ponderosa and Crystal Bay for satisfaction, and hold Liquid Gas and Atwood harmless.

Counsel for Ponderosa and Crystal Bay did not become aware of the agreement until after the trial of the case. Upon learning of it, they moved for a new trial upon the grounds that the agreement constituted an irregularity in the proceedings preventing a fair trial, and surprise, which ordinary prudence could not have guarded against. NRCP 59(a)(1)(3). The substance of their argument upon the motion for new trial, and now to us, is that the agreement impelled counsel for the codefendants Liquid Gas and Atwood to encourage a plaintiffs’ verdict for more than $20,000, since such a verdict would relieve those defendants of any responsibility to pay.

The agreement is unusual. It is neither a release, a covenant not to sue, nor a covenant not to execute. Cf. Whittlesea v. Farmer, 86 Nev. 347, 469 P.2d 57 (1970). It did not settle the case and discharge the cause of action against Liquid Gas and Atwood. It did guarantee the plaintiffs $20,000 subject to specified conditions, and possessed the potential to encourage counsel for Liquid Gas and Atwood to join forces with the plaintiffs to promote a verdict of more than $20,000.¹ This, however, was not its inevitable consequence. The district court refused to disturb the verdict and grant a new trial. That court apparently believed that the agreement did not influence the outcome of the case.

It is difficult to perceive how the district court could have ruled otherwise. The jury was not aware of the agreement. There is ample evidence to support the verdict. Indeed, the sufficiency of the evidence is not challenged by the appealing defendants. They had full opportunity to defend in the manner selected by their counsel. The special damages sustained by the plaintiffs were not controverted. Neither did they question the extent of injury suffered by the plaintiff Charles Emrich as described by his treating physician. None of the defendants offered medical evidence in defense. Counsel for the appealing defendants did not discuss the matter of damages in his jury summation, but limited his argument to liability.

In spite of these exceedingly significant factors the appealing defendants contend that the trial was unfair. This contention is made because of the jury argument of counsel for the codefendants in which he abandoned the pleaded defenses of contributory negligence and assumption of the risk, admitted liability, and suggested that all of the defendants should be held liable to the plaintiffs. That counsel did not indicate to the jury that the verdict should be in excess of $20,000, or in any other amount.

We cannot fault that argument. There is no impropriety in admitting liability when the evidence points to liability, as it did in this case. That is a matter of trial strategy. Neither is it improper to suggest that the other defendants in the case should share the burden of payment when the evidence supports that suggestion. It is common for codefendants to assume such a stance before a jury. In short, there is nothing which counsel for Liquid Gas and Atwood did, or failed to do, which caused the trial to be unfair. Counsel for the appealing defendants was free to persist in his effort to escape liability and endeavored, unsuccessfully, to do so.

Affirmed.

Zenoff and Batjer, JL, concur.

1 The validity of the agreement is not before us. Counsel for plaintiffs and for defendants Liquid Gas and Atwood were asked before trial whether they had settled their case. Each answered “no.” The district court properly found that the answers were technically correct; that the agreement settled nothing. However, that court believed that the existence of the agreement should have been disclosed, and for that reason, set it aside and ordered that the contracting parties either file a disclaimer or a satisfaction of judgment to the extent of one half thereof. That satisfaction was filed and Liquid Gas and Atwood released from further liability. Consequently, the court order was not challenged and Liquid Gas and Atwood are not parties to this appeal.