Civil Settlements and Criminal Cases


D is prosecuted for violation of a Price Control Act in selling P a car at a price above the legal limit. The act premises criminal liability on a showing of willfulness, whereas civil liability exists for merely negligent violations. Testimony at trial shows that salesperson S, employed by D, actually made the sale. Liability therefore turns on whether D directed or acquiesced in S's overcharging of P, the prosecutrix. The prosecution offers evidence of an offer made by D to P to refund the overcharge. D objects.

What ruling and why? What other information might the judge want to have before making this decision? What other policies besides that in favor of extrajudicial settlement of disputes are relevant in this context?


Criminal liability requires willfulness. Civil liability exists for merely negligent violations. Even if D's offer to P to refund the overcharge could be constituted as an admission of civil liability, it would only constitute an admission of negligent supervision of S. This is not relevant in a criminal case where willfulness must be shown. Thus, not only are all of the policy reasons of Rule 408 present, there is the additional relevancy problem caused by the difference in standards of liability in the civil and criminal cases. Moreover, the general public policy reason underlying Rule 408 is stronger when it encourages settlement of civil cases without prejudice to possible criminal violations. In the reverse situation, the existence of the nolo contendere plea reflects this policy. See Rule 410(2).

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