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Mary Carter Agreements, Litigation Settlements

In multi-party litigation, sometimes some but not all parties will reach a settlement agreement. These are broadly referred to as “Mary Carter Agreements.” They can be signed for any number of reasons strategically.

The Missouri Supreme Court has found that a typical Mary Carter agreement has the following features:

1) The liability of the settling defendant is limited, and the plaintiff is guaranteed a minimum recovery; 2) The settling defendant remains a party to the pending action without disclosing the full agreement to the non-settling parties and/or the judge and jury, absent court order; and 3) If judgment against the non-settling defendant is for more than the amount of settlement, any money collected will first offset the settlement so that the settling defendant may ultimately pay nothing. Newman v. Ford Motor Co., 975 S.W.2d 147, 149 (Mo. 1998).

Contact questions questions relating to Mary Carter Agreements and litigation generally.