New Mexico Supreme Court Reverses Appellate Ruling, Holding that Admitted Evidence Was Prejudicial

Earlier this month, New Mexico’s Supreme Court issued an opinion regarding a complex dispute between a driver and an insurance company. The case was the subject of two jury trials and two appeals. Two specific evidentiary issues were appealed to the Supreme Court.

Legal News GavelFacts of the Case

The case stems from a dispute between two drivers and their insurance company. Apparently, the driver, who was covered under his parent’s insurance, was involved in an accident at around 1:30 a.m. on November 4, 2002. The insurance company claimed that the policy expired at 11:59 p.m. on November 3, 2002 – approximately 90 minutes prior to the accident.

The insurance company filed for a declaratory judgment, asserting that the parties were not insured at the time of the accident. The driver and his parents filed a counterclaim, arguing that they should be covered because the insurance company was acting in bad faith. During this time, the driver was sued by an injured third party. The insurance company paid a settlement but reserved its right to be reimbursed by the driver.

Procedural Background

As mentioned above, the parties’ dispute has involved two jury trials and two appeals. The Supreme Court reviewed two specific evidentiary rulings that the lower court made before the second trial. The appeals court held that the lower court erred when it excluded evidence at the second trial of a prior summary judgment ruling that the driver lacked insurance and that the insurance company paid a sum of money to settle the third party’s claim. The driver asked the Supreme Court to consider several issues on appeal. Important to this discussion was the driver’s first issue:  whether the appeals court erred when they held that evidence of the reversed summary judgment should be revealed. Essentially, the driver wanted to keep out an earlier legal determination – which was reversed on appeal – that he lacked coverage.

Supreme Court Holding

On appeal, the insurance company argued that the previous determination – although reversed on appeal – showed that the company may not have been acting in bad faith when it denied the claim. The plaintiff’s position was that the previous ruling was entirely irrelevant and not before the jury, and, had it been presented to the jury, it would have had undue weight.

The Supreme Court held that the district court properly excluded evidence of the reversed summary judgment ruling and settlement. The court held that New Mexico Rule 11-403 allows courts the discretion to exclude evidence if “its probative value is substantially outweighed by a danger of one or more of the following, unfair prejudice, confusing the issues.”

Here, the court determined that the evidence of the previous ruling provided only limited probative value to the jury but significantly prejudiced the driver. Thus, the court determined that keeping such evidence out of the jury’s consideration was proper.

Have You Been Injured in a New Mexico Car Accident?

If you or a loved one has recently been injured in a New Mexico car accident, you may be entitled to monetary compensation. The above discussion serves as a reminder of how complex some lawsuits can be and how important zealous, dedicated advocacy is to a plaintiff’s case. At the Fine Law Firm, we strive to always be on the cutting edge of New Mexico personal injury law, and we appreciate the challenges presented by unique cases. We have a dedicated team of experienced New Mexico personal injury lawyers to help our clients pursue the compensation they deserve. Call 505-889-FINE to schedule your free consultation today.

More Blog Posts:

State Recreational Use Statute Shields Stadium from Liability Because Child’s Admission Was Free, New Mexico Personal Injury Lawyer Blog, February 20, 2017.

New Mexico Circuit Court Finds Mountain Resort Waiver of Liability Valid in Negligence Lawsuit, New Mexico Personal Injury Lawyer Blog, February 5, 2018.