Estate Planning

Mary Carter Can Assist You: No Retainer Required

By Hull & Hull LLP

A Mary Carter Agreement originated from the Florida decision entitled Booth v. The Mary Carter Paint Company. In effect, this case stands for the proposition that in return for payment to the plaintiff of a specific sum of funds, the settling defendant caps her potential liability. For example, a defendant may enter into an agreement with a plaintiff, where it is understood that, regardless of the outcome, the defendant agrees to compensate the plaintiff in the amount of $20,000.00. If the plaintiff is awarded at trial a judgment that exceeds this amount, she is required to enforce the ruling against the other defendants not subject to the Mary Carter Agreement.

Not only can a Mary Carter Agreement be a useful litigation strategy, but it may also be beneficial to an estate trustee who is charged with defending a claim against the estate. Had the deceased entered into a Mary Carter Agreement during her lifetime, she would have likely been able to cap her exposure, which may translate into a significantly larger estate.

Thanks and have a great weekend,

Allan Socken

Full post as published by Toronto Estate Law Blog on April 04, 2008 (boomark / email).