eJournal

From time to time, eJournal features excerpts from the expanded Seventh Edition of the Massachusetts Bar Association’s award-winning malpractice prevention handbook, Traps for the Unwary, which looks at some of the malpractice hazards for attorneys who practice in a general, civil practice. This Trap of the Week looks at entering into high-low agreements.

Traps Example:
High-Low Agreements

In some instances, the parties at a trial may seek to enter into a “high-low agreement,” i.e., a contract that provides that if the jury’s verdict is above a certain amount, the defendant will only be required to pay the “high” figure, and if the verdict is for no liability or for an amount below a certain amount, the defendant will pay the “low.” Such contracts are valid and enforceable, but care should be taken to specify how interest and costs should be factored into the amount (the verdict? the judgment?), and the agreement should specify whether post-verdict and appellate rights are waived. See David v. Kelly, 100 Mass. App. Ct. 443, 178 N.E.3d 878 (Oct. 25, 2021), further app. rev. denied, 488 Mass. 1109, 180 N.E. 3d 967 (Dec. 21, 2021), where the agreement was held to not waive appellate rights because the verdict fell between the low and high figures. “Waiver must be shown clearly, unmistakably and unequivocably.” 100 Mass. App. Ct. at 446. In addition, parties may want to wait until jury deliberations begin before entering into such agreements. At that point, the parties will be most knowledgeable about whether misconduct or reversible error has occurred that might skew the verdict.