FIRST PREMIER v. KOLCRAFT

• Decision Date: 18 August 2004
• Docket Number: No. 22449., No. 22421
• Citation: 686 N.W.2d 430,2004 SD 92
• Parties: FIRST PREMIER BANK, as Guardian Ad Litem and Limited Conservator of Daniel L. Boone, Plaintiff and Appellant, v. KOLCRAFT ENTERPRISES, INC., a Delaware corporation, Defendant and Appellee.
• Court: South Dakota Supreme Court

686 N.W.2d 430

2004 SD 92

FIRST PREMIER BANK, as Guardian Ad Litem and Limited Conservator of Daniel L. Boone, Plaintiff and Appellant, v. KOLCRAFT ENTERPRISES, INC., a Delaware corporation, Defendant and Appellee.

Nos. 22421, 22449.

Supreme Court of South Dakota.

Argued on October 8, 2003.

Decided August 18, 2004.

Michael P. Healy, Kansas City, Missouri, Rollyn H. Samp, Sioux Falls, South Dakota, Jonathan K. Van Patten, Vermillion, South Dakota, Attorneys for plaintiff and appellant.

Mark F. Marshall, Michael L. Luce of Davenport, Evans, Hurwitz & Smith, Sioux Falls, South Dakota, Charles J. Risch of Lawrence, Kamin, Saunders & Uhlenhop, Chicago, Illinois, Attorneys for defendant and appellee.

KONENKAMP, Justice.

Litigants are ordinarily prohibited from disclosing to a jury a prior settlement "to prove liability for or invalidity of the claim or its amount." This prohibition, embodied in our rules of evidence, avoids prejudice to all parties and promotes settlements. Here, defense counsel broached the fact of an earlier settlement made on plaintiff's behalf. Although the trial court had advised counsel not to offer evidence about this settlement until he ruled on the pending motion in limine, the court took the position that since remarks by attorneys are not evidence, neither side would be precluded from disclosing in their opening statements matters subject to pending motions. Ultimately, the court granted plaintiff's motion in limine, ruling that the prejudicial impact of the settlement evidence outweighed its probative value. Yet the court nonetheless found that any prejudice created by the disclosure of the settlement in defense counsel's opening statement did not warrant a new trial. Because, in most instances, a prior settlement should not be disclosed to the jury by any means, the court abused its discretion in allowing counsel to reveal it in remarks to the jury. This error, along with error in the jury instructions, impaired the plaintiff's right to a fair trial. We affirm in part, reverse in part, and remand for a new trial.

Background

On January 12, 1992, Daniel Boone, age ten months, was severely burned while he was sleeping in a playpen in the children's bedroom at his parents' apartment. Defendant Kolcraft Enterprises manufactured the pads for its "Playard" playpens using two types of polyurethane foam. For customers in California, polyurethane treated with a fire retardant was used, as required by law. For all other customers, non-treated foam was used. After this incident, Kolcraft began using treated foam in all the pads it manufactured.

Peggy Boone first sued her landlord for her child's injuries. That matter settled. Plaintiff, First Premier Bank, was later appointed the child's guardian ad litem to pursue further legal action on the child's behalf. Its complaint alleged that the playpen was (1) defective and unreasonably dangerous in its design, or (2) defective and unreasonably dangerous because of a failure to warn. Kolcraft moved for summary judgment before trial and a directed verdict at the close of the evidence, arguing that as a matter of law plaintiff could not prove that Kolcraft's Playard proximately caused Daniel's injuries. The trial court denied both motions.

Before trial, both sides sought to exclude certain evidence by motions in limine. The judge declined to rule on the motions until the parties were ready to offer evidence during trial. In opening statements, with the court's indulgence, both sides mentioned topics subject to these motions. In other rulings, the court allowed testimony about the smoking habits of Daniel's parents and their non-functioning smoke detector, and permitted the defense to introduce the mother's earlier statement that a blanket was the origin of the fire. The court, however, did not allow plaintiff to introduce evidence that Kolcraft began using fire retardant foam in all its playpen pads after the incident here.

After a three-week trial, the jury found against plaintiff. The trial court denied plaintiff's motion for a new trial. On appeal, plaintiff advances manifold assignments of error with multiple subparts. Because not all these issues merit discussion, we address the following: (1) Whether plaintiff is entitled to a new trial because defense counsel disclosed to the jury in his opening statement that the injured child's mother had settled a suit for the same injuries against the family's landlord several years earlier. (2) Whether the trial court abused its discretion in allowing testimony and argument that careless cigarette smoking could not be ruled out as a source of ignition for the fire. (3) Whether the court erred in instructing the jury that it could infer that missing evidence would not have been favorable to plaintiff. (4) Whether the court erred in not giving definitions of "defective condition" in the disjunctive. (5) Whether the trial court erred when it refused to give the jury a limiting instruction on the use of prior inconsistent statements, thus allowing Kolcraft to use the statement as substantive evidence. (6) Whether the trial court erred in excluding evidence of Kolcraft's subsequent remedial measures on the ground that this evidence would "unduly delay" the trial. (7) Whether the trial court erred in allowing Kolcraft to raise the issue of a nonfunctioning smoke detector without proper foundation and to argue what was, in effect, a contributory negligence defense. On notice of review, Kolcraft asserts that the trial court erred when it denied its motion for a directed verdict on the question whether Kolcraft's Playard was the proximate cause of Daniel's injuries.

I. Disclosure of Prior Settlement

Plaintiff seeks a new trial because Kolcraft violated an order in limine excluding evidence of a prior settlement. During Kolcraft's opening statement, defense counsel advised the jury that plaintiff had settled with the Boone family's former landlord several years earlier. Our standard of review is set forth in Schuldies v. Millar, 1996 SD 120, ¶ 8, 555 N.W.2d 90, 95 (citation omitted):

Whether a new trial should be granted is left to the sound judicial discretion of the trial court, and this Court will not disturb the trial court's decision absent a clear showing of abuse of discretion.... We determine that an abuse of discretion occurred only if no judicial mind, in view of the law and the circumstances of the particular case, could reasonably have reached such a conclusion.

The abuse of discretion standard also governs a denial of a motion for mistrial based on a violation of an order in limine. Joseph v. Kerkvliet, 2002 SD 39, ¶ 7 n. 1, 642 N.W.2d 533, 535 n. 1. To justify a new trial for a violation of such an order, the order must have been specific and the violation clear. Harter v. Plains Ins. Co., Inc., 1998 SD 59, ¶ 31, 579 N.W.2d 625, 633. In addition, the violation must have been prejudicial. Id. ¶ 32, 579 N.W.2d 625.

Motions in limine are ordinarily heard in advance of trial; they seek a court order requiring parties, attorneys, and witnesses not to disclose "certain facts unless and until permission of the court is first obtained outside the presence and hearing of the jury." Kjerstad v. Ravellette Publications, Inc., 517 N.W.2d 419, 426 (S.D.1994) (quoting Lapasinskas v. Quick, 17 Mich.App. 733, 170 N.W.2d 318, 319 (1969). Evidentiary rulings made by a trial court during motions in limine are preliminary and may change depending on what actually happens in trial. Luce v. United States, 469 U.S. 38, 41, 105 S.Ct. 460, 463, 83 L.Ed.2d 443 (1984). The purpose of the motion "is to prevent prejudicial evidence from reaching the ears of the jury." Id. As we noted in Kjerstad, when prejudicial matters are brought before the jury, objections or instructions can never entirely remove the harmful effect. Depending on the nature of the motion, a court may delay ruling because of a lack of sufficient facts on which to base a decision or because it is unable to predict the effect of its ruling on the trial. However, if the court reserves its ruling, it must then decide how it is going to handle possible mention of the subject matter during jury selection and opening statements. Once the subject is broached, "the harm is done." Kjerstad, 517 N.W.2d at 426 quoting Lapasinskas, 170 N.W.2d at 319).

Here, before trial, both parties submitted numerous motions in limine. During a pretrial motions hearing, the judge set forth his policy concerning rulings on the pending forty-five motions:

I want to tell you about my rulings on these motions in limine, and that is that there aren't going to be any rulings.... [I]n order to rule on them I think [I] have got to hear evidence, so I'm not going to rule on them until the time comes. And so before you would present that evidence, you're going to approach me and we'll have a hearing outside of the presence of the jury with the witness on the stand and we'll take whatever evidence we need....¹

Kolcraft's attorney attempted to clarify the instruction:

[C]orrect me if my understanding is not accurate — that if any of these issues covered by the motions in limine before we make any comments in terms of a question or statement or solicit any type of testimony from a witness, counsel is required and has the obligation, whichever side, to first come up. . . ."

Citing SDCL 15-14-1, the judge responded, "With the exception of the opening statement, and the opening statement is what you intend to prove."² There, the confusion began.

After vigorous disagreement by Kolcraft's counsel, the judge gave the parties his ruling:

[I]n this kind of case with all of these motions in limine, if I have to rule on the opening statement, that is just intolerable. I'm just not going to blue pencil any opening statement. You lawyers know probably in your heart of hearts what is going to come in and what isn't. All right. And if you get yourself backed in a corner where you admit stuff

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