Rule 408: Compromise and offers to compromise.

Evidence of (1) furnishing or offering to furnish or (2) accepting or offering to accept a valuable consideration in compromising or attempting to compromise a claim, whether in the present litigation or related litigation, which claim was disputed or was reasonably expected to be disputed as to either validity or amount, is not admissible to prove liability for or invalidity of a civil claim or its amount or a criminal charge or its punishment. Evidence of conduct or statements made in compromise negotiations is likewise not admissible. This rule does not require the exclusion of any evidence actually obtained during discovery merely because it is presented in the course of compromise negotiations. This rule also does not require exclusion when the evidence is offered for another purpose, such as proving bias or prejudice of a witness, negativing a contention of undue delay, or proving an effort to obstruct a criminal investigation or prosecution; however, a party may not be impeached by a prior inconsistent statement made in compromise negotiations.

Advisory Commission Comments.

The rule would work only slight changes in Tennessee evidence law. One difference is that statements of fact during settlement negotiations become inadmissible, but that is an improvement over the present practice admitting the fact statements.

Also salutary is the provision excluding compromises and settlement offers in "related litigation."The drafted language would change the suggestion to the contrary in Tennessee Coach Co. v. Young, 18 Tenn. App. 592, 80 S.W.2d 107 (1934). Consistent with the proposal is T.C.A. § 29-11-105(b), excluding evidence of settlement by one tortfeasor where another goes to trial.

Tennessee courts exclude settlements and settlement offers only in civil trials, admitting them in criminal prosecutions. Carter v. State, 161 Tenn. 698, 34 S.W.2d 208 (1931). The proposed rule excludes such evidence in both civil and criminal trials.

Advisory Commission Comments [1993].

Where punitive damages are at issue, compromise offers become relevant and admissible despite Rule 408. See Hodges v. S.C. Toof & Company, 833 S.W.2d 896 (Tenn. 1992).