the disclosure to the jury of the fact of settlement should be left to the discretion of the trial court, but the amount should not be made known; under the circumstances, the failure to disclose the fact of a settlement made during trial, coupled with counsel’s exploitation of the jury’s lack of knowledge of the reason for the “evaporation of adversary vigor” between the plaintiff and the settling defendant, was an abuse of discretion
How later courts described this case
- the disclosure to the jury of the fact of settlement should be left to the discretion of the trial court, but the amount should not be made known; under the circumstances, the failure to disclose the fact of a settlement made during trial, coupled with counsel’s exploitation of the jury’s lack of knowledge of the reason for the “evaporation of adversary vigor” between the plaintiff and the settling defendant, was an abuse of discretion
- settlement cannot be used for collusive advantage
Written by the judges who cited it.
Later courts went against this
Overruled on other grounds by First Premier Bank v. Kolcraft Enterprises, Inc., 2004 S.D. LEXIS 160 (2004)
” Degen v. Bayman (Degen I), 86 S.D.598, 200 N.W.2d 134, 136 (1972), overruled on other grounds by First Premier Bank v. Kolcraft Enters., Inc., 686 N.W.2d 430 (S.D.2004).
The opinion
BIEGELMEIER, Judge
(dissenting).
When the proposed opinion was circulated my efforts resulted in a research paper of considerable length. It did not receive favor with the other members of the court. With an extended trial *609 of involved and intricate issues covering more than a thousand pages of evidence, over 45 assignments of error and nearly 300 pages of briefs (by special permission) to consider, it is difficult to compress reasons that will cover the problems involved.
I. As I read the opinion, the court states one of the principles of law where indemnity is allowed — -that of the active-passive negligence situation, referred to in 41 Am.Jur.2d, Indemnity, §§ 20 and 21 —and then applies it to this appeal without regard to the other and additional situations where indemnity is allowed. These other and additional situations are also stated in the same text and sections (41 Am.Jur.2d, Indemnity, §§ 20 and 21) and, indeed, even in the Minnesota Hendrickson and the Wisconsin Jacobs opinions all cited and relied on in the majority opinion. I believe indemnity can be sustained by principles there stated and hereafter quoted, and that indemnity can be allowed if a party comes within any one of the situations 'stated.
There is no dispute that some of the authorities quoted are in accord with Millard v. Baker, 76 S.D. 529 , 81 N.W.2d 892 , but those issues are not involved in this appeal. What is involved is whether Bayman should have discovered the dangerous defect O.M.C. had built into the starting mechanism that permitted the motor to be started while the propeller was engaged in forward or reverse. That was a question for the jury and is governed by the following statement in 41 Am.Jur.2d, Indemnity, § 20, partially quoted by the court:
"Similarly, indemnity will be granted where the indemnitee (Bayman) has incurred liability to a third person (Degan) by reason of negligent reliance upon the care which the indemnitor (O.M.C.), as a supplier of goods or contractor making repair and improvements, should have exercised, or where the one seeking indemnity (Bayman) has incurred liability merely because of failure, even though negligent, to discover or prevent the misconduct of the one sought to be charged." (emphasis supplied.)
Restatement of the Law, Restitution, § 93, similarly declares:
*610 "(1) Where a person has supplied to another a chattel which because of the supplier's negligence or other fault is dangerously defective for the use for which it is supplied and both have become liable in tort to a third person injured by such use, the supplier is under a duty to indemnify the other for expenditures properly made in discharge of the claim of the third person, if the other used or disposed of the chattel in reliance upon the supplier's care and if, as between the two, such reliance was justifiable * *
The Minnesota and Wisconsin opinions, supra, indicate indemnity and contribution have developed there by court decisions as equitable doctrines. Yet, the Minnesota Hendrickson opinion states that of several situations where indemnity is allowed, one is when the indemnitee has incurred liability.
"(4) * * * because of failure, even though negligent, to discover or prevent the misconduct * *
Even assuming the active-passive situation is here presented, Pearson Ford Company v. Ford Motor Company, 273 Cal.App.2d 269 , 78 Cal.Rptr. 279 , cited in the majority opinion, declares the guide for which I contend. In that case there was a defect in the brake, caused by omitting to put in a pin, which resulted in damage to plaintiff. She recovered a $150,000 judgment against both the dealer and the manufacturer, and the dealer was allowed indemnity against the manufacturer. While the court reversed because of an error in instructions, it said that the law of active-passive negligence applied, and, if active, it would bar recovery of indemnity of the dealer against the manufacturer. It then wrote:
"Pearson's failure to discover the defect would be 'active negligence,' if, under all the circumstances and in the exercise of ordinary care, it should have made that discovery. * * *
"Ford earnestly contends on appeal that Pearson's participation in the events leading to the accident is such as to preclude its right to indemnification as a matter of *611 law. We disagree with this contention. No contention is made, nor would the record support a finding that Pearson's employees had actual notice or knowledge of the defect. The defect itself was extremely unusual, and reasonable minds could differ whether under the evidence and the applicable law Pearson's employees should have discovered it."
The action was sent back for the trial on that issue and is authority for submitting that question in this case at bar to a jury, its verdict being final. Accord: Otis Elevator Co. v. Cameron, Tex.Civ.App., 205 S.W. 852 , where the court held Otis, the manufacturer of a defective elevator, "was the original and active perpetrator of the wrong for which R. L. Cameron was held responsible * * * and that the negligence of * * * Cameron * * * was only passive."
In VanderVeer v. Tyrrell, 27 A.D.2d 958 , 278 N.Y.S.2d 916 , cited in the opinion, appears this statement of an operator's (Bayman's) duty:
"a person briefly using a rental golf cart (has no) duty to inspect its internal mechanism, as to which he is, more often than not, neither possessed of, nor reasonably expected to be possessed of, expertise in any particular degree."
II. While holding the protective order was proper, the opinion quotes part of the argument of counsel for defendant Bayman. Granting this statement bordered on impropriety, it was not of the degree disapproved in Cooper v. Holscher, 60 S.D. 83 , 243 N.W. 739 , where the court over objection commented the argument was proper and told counsel to " 'Proceed' ", The jurors were not misled by the tactics of Bayman's counsel; they knew Bayman and O. M. C. were opposing parties and adversaries because Bayman was asking for and the jury awarded a verdict against O. M. C. To set aside the verdict of plaintiff by reason of an argument of a co-defendant does not seem justified. In affirming *612 an order denying a new trial on a claim of passion and prejudice, the court in Roth v. Jelden, 80 S.D. 40 , 118 N.W.2d 20 , said "the trial court is vested with a judicial discretion".
III. Even under the court's opinion that the verdict and judgment of Bayman against O. M. C. cannot be sustained, there is no reason the separate verdict and judgment of plaintiff against both Bayman and O. M. C. should fall by the wayside in this well-tried action involving difficult and intricate issues. The appropriate disposition would be to reverse only the Bayman judgment for indemnity against O. M. C. and remand the action for trial of the issue of contribution between them under SDCL 15-8. I do not understand the opinion to affect in any way the right to contribution between defendants.