Mary Carter agreement

noun
Mary Car·ter agreement | \ˈmer-ē-ˈkär-tər-\

Legal Definition of Mary Carter agreement 

: a secret agreement between a plaintiff and one or more but not all codefendants which limits the liability of the defendants by giving them an interest in the recovery awarded to the plaintiff

Note: In a Mary Carter agreement, the participating defendants agree to remain as parties to the lawsuit and guarantee payment to the plaintiff of a settled amount if no recovery is awarded against the other defendants. The plaintiff agrees to offset their liability by, or sometimes even to pay them from, a recovery awarded from the other defendants. Some states allow the admission of Mary Carter agreements into evidence. In other states they are illegal.

History and Etymology for Mary Carter agreement

from Booth v. Mary Carter Paint Co., 202 So. 2d 8 (1967), Florida appeals court case that popularized the agreement

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