Mary Carter agreement
noun | \ ˈmer-ē-ˈkär-tər- \ | Mary Car·ter agreement
: a secret agreement between a plaintiff and one or more but not all codefendants which limits the liability of the defendants by giving them an interest in the recovery awarded to the plaintiff
Note: In a Mary Carter agreement, the participating defendants agree to remain as parties to the lawsuit and guarantee payment to the plaintiff of a settled amount if no recovery is awarded against the other defendants. The plaintiff agrees to offset their liability by, or sometimes even to pay them from, a recovery awarded from the other defendants. Some states allow the admission of Mary Carter agreements into evidence. In other states they are illegal.