The Importance Of Consistent Positions: Beware Of Judicial Estoppel
Nearly two thousand years ago, the ancient Roman legal system developed a series of maxims having general applicability in court. Around the year 161, the jurist Gaius wrote a textbook, “Institutes,” in which he set forth his philosophy of the legal status of persons, things, and civil procedure. Gaius’s treatise became largely integrated within Roman civil law, which then spread throughout other parts of the Roman empire, ultimately influencing English common law and later American jurisprudence. Gaius stated, “Allegans Contraria Non Est Audiendus,” latin for “a person who alleges contradictory facts is not to be heard.” Stated another way, a court can and should disregard the argument or testimony of someone who only says what appears convenient in the moment. In American jurisprudence, this principle ripened into the modern doctrine of judicial estoppel, beginning around the mid-1800s.
In 1857 in Hamilton v. Zimmerman, the Tennessee Supreme Court considered a dispute in which the plaintiff Hamilton claimed to be a “secret partner” of the defendant Zimmerman in co-owning a pharmacy business, although Hamilton was also employed as a clerk for the business. Hamilton had admitted in a prior lawsuit against Zimmerman, to collect on business debts, that Hamilton was the clerk of the business. The trial court sided with Hamilton, apparently accepting Hamilton’s testimony that he had to conceal his true position as partner in order to avoid creditor claims so that he could provide for his family. The Tennessee Supreme Court, reversed holding that Hamilton must now be estopped from taking a contrary position in the new lawsuit. Said the court: “This doctrine [of estoppel] is said to have its foundation in the obligation under which every man is placed to speak and act, according to the truth of the case; and in the policy of the law to suppress the mischiefs from the destruction of all confidence in the intercourse and dealings of men, if they were allowed to deny that, which by their solemn and deliberate acts, they have declared to be true. And this doctrine applies with peculiar force, to admissions or statements made under the sanction of an oath, in the course of judicial proceedings. The chief security and safeguard for the purity and efficiency of the administration of justice, is to be found in the proper reverence for the sanctity of an oath.”
The Hamilton case’s principles spread throughout the U.S., and were adopted by the U.S. Supreme Court.
In Washington State, judicial estoppel is an equitable doctrine that precludes a party from asserting one position in a court proceeding and later seeking an advantage by taking a clearly inconsistent position. It seeks to preserve respect for judicial proceedings, avoid inconsistency and duplicity and wastes of time. Courts will consider three core factors in deciding whether to apply judicial estoppel: (1) whether a party’s later position is clearly inconsistent with its earlier position; (2) whether judicial acceptance of an inconsistent position in a later proceeding would create the perception that either the first or second court was misled; and (3) whether the party seeking to assert an inconsistent position would derive an unfair advantage or impose an unfair detriment on the opposing party if not estopped. Courts may also consider whether the party’s position was based on inadvertence or mistake. Often, judicial estoppel comes into play when a debtor seeks to shield assets from creditors, especially in bankruptcy proceedings. The debtor may pretend that they had no right to certain property, but later take a contrary position when financial circumstances have changed.
The above principles highlight the importance of being consistent in court proceedings. Sometimes it can be challenging to know early in a dispute what legal position to take, even if the client is truthful about the facts. This is one reason why having experienced counsel is critical- experienced attorneys can craft effective arguments and positions based upon the facts and law, looking ahead to see how new information or an opposing party’s position might influence the case.
The lawyers at Beresford Booth have a wealth of experience in civil litigation and transactional matters. We would be happy to assist you. Please contact Beresford Booth at info@beresfordlaw.com or by phone at (425) 776-4100.