[Cite as Hodesh v. Korelitz, 123 Ohio St.3d 72, 2009-Ohio-4220.] 

HODESH, APPELLANT, v. KORELITZ ET AL., APPELLEES, ET AL. 

[Cite as Hodesh v. Korelitz, 123 Ohio St.3d 72, 2009-Ohio-4220.] 

A Mary Carter agreement must be disclosed to a jury — Agreement in this case 

was not a Mary Carter agreement, and the trial court did not abuse its 

discretion in not disclosing it to the jury.

(No. 2008-1133 — Submitted April 7, 2009 — Decided August 27, 2009.) 

APPEAL from the Court of Appeals for Hamilton County, 

Nos. C-061013, C-061040, C-070168, and C-070172, 2008-Ohio-2052. 

__________________ 

PFEIFER, J. 

{¶ 1} The sole legal issue in this case is whether an agreement between 

appellant, Michael Hodesh, and one of the defendants in Hodesh’s medicalmalpractice action, Jewish Hospital of Cincinnati, should have been disclosed to 

the jury. For the reasons that follow, we conclude that the trial court did not 

abuse its discretion by not requiring disclosure of the agreement. 

Facts and Procedural History 

{¶ 2} Michael Hodesh filed a medical-malpractice action against 

appellee Dr. Joel Korelitz and the Jewish Hospital of Cincinnati, among others, 

alleging that Korelitz and the hospital staff had left a towel in his abdomen 

following a surgery for diverticulitis. Two and a half weeks before the trial, 

Hodesh and the hospital entered into a “Contingency Agreement,” which 

contained, among other provisions, a series of provisions that collectively limited 

the hospital’s exposure to $250,000 and ensured that Hodesh would receive at 

least $175,000. 

{¶ 3} On the first day of trial, Korelitz requested disclosure of any 

agreements between Hodesh and the hospital. The court ordered Hodesh to 
SUPREME COURT OF OHIO

2 

submit to the court any existing agreements between him and the hospital. 

Hodesh submitted the agreement, which the judge did not read before placing it 

under seal. The judge stated that there was no evidence of collusion and, based 

on Hodesh’s declaration that the agreement was a high/low agreement, concluded 

that the agreement did not need to be disclosed to the jury. The jury found 

Korelitz negligent and returned a verdict in favor of Hodesh, awarding him 

$775,000. The jury also found that the hospital was not liable. After the verdict, 

the court provided a copy of the agreement to Korelitz. 

{¶ 4} Korelitz appealed on several grounds. The only issue he raised 

that is relevant to this case is whether the trial court erred by not compelling 

disclosure of the agreement. The court of appeals held that the trial court 

committed reversible error by not disclosing the agreement to the jury. We 

accepted Hodesh’s discretionary appeal. 

Settlement Agreements 

{¶ 5} Settlement agreements are valid when “there is no evidence of 

collusion, in bad faith, to the detriment of other, non-settling parties.” 

Krischbaum v. Dillon (1991), 58 Ohio St.3d 58, 69-70, 567 N.E.2d 1291. 

Although settlement agreements are as varied as the cases in which they are used, 

they fall into general categories. In a typical settlement agreement, “a settling 

defendant is withdrawn from the case and released from liability.” Monti v. 

Wenkert (2008), 287 Conn. 101, 122, 947 A.2d 261. In a typical “high-low 

settlement agreement * * *, the settling defendant remain[s] in the case and the 

extent of her liability [is] predicated on the amount of the verdict.” Id. There is 

another species of settlement agreement, called a Mary Carter agreement, see 

Booth v. Mary Carter Paint Co. (Fla.App.1967), 202 So.2d 8, which we have 

defined as “a contract between a plaintiff and one defendant allying them against 

another defendant at trial.” Vogel v. Wells (1991), 57 Ohio St.3d 91, 93, 566 

N.E.2d 154. See Saleeby v. Rocky Elson Constr., Inc. (Fla.2009), 3 So.3d 1078, 
January Term, 2009 

3 

1083, fn. 3 (a Mary Carter agreement is “a contract by which one co-defendant 

secretly agrees with the plaintiff that, if such defendant will proceed to defend 

himself in court, his own maximum liability will be diminished proportionately by 

increasing the liability of the other co-defendants”). The court of appeals in this 

case determined that the agreement between Hodesh and the hospital was a Mary 

Carter agreement, and that determination is why it held that the agreement should 

have been disclosed. 

{¶ 6} Mary Carter agreements are per se invalid in some states. See, 

e.g., Dosdourian v. Carsten (Fla.1993), 624 So.2d 241, 246; Cox v. Kelsey-Hayes 

Co. (1978), 1978 OK 148, 594 P.2d 354, 360; Elbaor v. Smith (Tex.1992), 845 

S.W.2d 240, 250. We mentioned this minority view in Ziegler v. Wendel Poultry 

Servs., Inc. (1993), 67 Ohio St.3d 10, 16, 615 N.E.2d 1022, overruled on other 

grounds by Fidelholtz v. Peller (1998), 81 Ohio St.3d 197, 690 N.E.2d 502. We 

did not adopt the minority position then, nor do we now. Instead, we are 

persuaded that the majority approach, which requires Mary Carter agreements to 

be disclosed to codefendants and the jury, is more reasonable and compatible with 

Ohio’s approach to settlement agreements. Monti, 287 Conn. at 124, 947 A.2d 

261. See Soria v. Sierra Pacific Airlines, Inc. (1986), 111 Idaho 594, 604, 726 

P.2d 706 (disclosure exposes a settling defendant’s incentive to increase 

plaintiff’s damages). 

{¶ 7} We have considered agreements alleged to be Mary Carter 

agreements on two separate occasions; both times we determined that the 

agreement was valid and did not need to be disclosed to the jury. Vogel, 57 Ohio 

St.3d at 93-94, 566 N.E.2d 154; Ziegler, 67 Ohio St.3d at 17, 615 N.E.2d 1022. 

In Vogel, a defendant/appellant alleged that another defendant and the plaintiff 

had entered into a collusive agreement akin to a Mary Carter agreement and that 

the trial court had erred in refusing to disclose the existence of the agreement to 

the jury. Vogel, 57 Ohio St.3d at 93-94, 566 N.E.2d 154. We noted that Mary 
SUPREME COURT OF OHIO

4 

Carter agreements typically have three basic provisions: a guarantee of a 

minimum payment to the plaintiff, an agreement that the plaintiff will not enforce 

a court judgment against the settling defendant, and an agreement that the settling 

defendant will remain a party in the trial but his monetary exposure is reduced in 

proportion to an increase in the liability of nonsettling codefendants. Id. at 93, fn. 

1. We concluded that the agreement at issue was not collusive, after examining 

the trial court’s decision under an abuse-of-discretion standard. Id. at 94. 

{¶ 8} In Ziegler, we concluded that the agreement between the plaintiff 

and one of the defendants was not a Mary Carter agreement, primarily because 

“[t]he amount of damages assessed against [the nonsettling defendant] had no 

impact on the amount [the settling defendant] would pay to [the plaintiff]. There 

was no built-in incentive on [the settling defendant’s] part to increase [the 

plaintiff’s] damages.” Ziegler, 67 Ohio St.3d at 16-17, 615 N.E.2d 1022. We 

also stated that “[o]ne of the major dangers of Mary Carter agreements lies in the 

distortion of the relationship between the settling defendant and the plaintiff, 

which allows the settling defendant to remain nominally a defendant to the action 

while secretly conspiring to aid the plaintiff’s case.” Id. at 17. See Vermont 

Union School Dist. No. 21 v. H.P. Cummings Constr. Co. (1983), 143 Vt. 416, 

427, 469 A.2d 742. 

{¶ 9} Although the advent of complex contingent agreements has 

complicated the matter, we remain committed to facilitating the settlement of 

legal controversies, even contingent agreements that do not preclude the necessity 

of a trial. Krischbaum, 58 Ohio St.3d at 69-70, 567 N.E.2d 1291. All settlement 

agreements in Ohio must be free from collusion, regardless of whether they fall 

under the category of Mary Carter agreements. When reviewing a settlement 

agreement to determine whether it is collusive, we are guided by the typical Mary 

Carter agreement provisions; specifically, we look for a provision that decreases 

the settling defendant’s liability in proportion to an increase in the nonsettling 
January Term, 2009 

5 

defendant’s liability. Vogel, 57 Ohio St.3d at 93, 566 N.E.2d 154, fn. 1 (setting 

forth the basic Mary Carter agreement provisions). See Hoops v. Watermelon 

City Trucking Inc. (C.A.10, 1988), 846 F.2d 637, 640. We are concerned that 

such an arrangement provides an inducement for the settling defendant to 

“secretly conspir[e] to aid the plaintiff’s case.” Ziegler, 67 Ohio St.3d at 17, 615 

N.E.2d 1022. This collusive purpose is obviated when the settling defendant “ 

‘remain[s] at risk of liability in a significant amount.’ ” Id., quoting the court of 

appeals opinion (Dec. 31, 1991), 3d Dist. Nos. 3-90-31 and 3-90-44, 1991 WL 

280029. 

The Agreement between Hodesh and the Hospital 

{¶ 10} As a preliminary matter, we note that “[i]n construing the terms of 

any contract, the principal objective is to determine the intention of the parties.” 

Hamilton Ins. Servs, Inc. v. Nationwide Ins. Cos. (1999), 86 Ohio St.3d 270, 273, 

714 N.E.2d 898. 

{¶ 11} The agreement between Hodesh and the hospital contains 16 

numbered paragraphs. When read in pari materia, they evince an intention to 

ensure that Hodesh receives at least $175,000 and that the hospital’s liability be 

capped at $250,000. This is apparent from paragraph 7 of the agreement, which 

states, “In any contingency that has not been addressed specifically by this 

Agreement, [the hospital] guarantees [Hodesh] a total payment of at least 

$175,000.00 with a cap of $250,000.00. In no event, will [the hospital] be 

required to pay Hodesh more than $250,000.00.” The most problematic 

contingency for Hodesh is paragraph 3, which includes, among other things, this 

provision: “In the event there is a verdict against Korelitz and not [the hospital] 

for more than $250,000.00, Hodesh will not look to [the hospital] for any payment 

and will recover all from Korelitz.” 

{¶ 12} This provision appears to provide an incentive for the hospital to 

increase the damages against Korelitz. See Ziegler, 67 Ohio St.3d at 16-17, 615 
SUPREME COURT OF OHIO

6 

N.E.2d 1022. But three factors prevent us from reaching that conclusion. First, 

there are several contingency clauses under which the hospital will pay less if the 

damages are less. The lower the verdict, the greater the likelihood that the 

hospital would be required to pay $175,000 and the less the likelihood that it 

would be required to pay $250,000. Thus, the hospital had a financial interest in a 

lower verdict. See Ziegler at 17. 

{¶ 13} Second, paragraph 3 requires the hospital to pay $175,000, even if 

the verdict against Korelitz exceeded $250,000, if Korelitz or his insurance 

company does not pay within 30 days. An appeal by Korelitz would delay 

payment past 30 days, triggering this provision, and the higher the verdict, the 

more likely it would be that Korelitz would appeal. 

{¶ 14} Third, the trial judge saw no signs of collusion during the trial. 

Even though the judge had not read the agreement, he knew that Hodesh and the 

hospital had an agreement and that Korelitz was concerned that the agreement 

was collusive. Thus, he was on alert for any trial tactics that appeared collusive. 

{¶ 15} A better course of action would have been for the judge to read the 

agreement prior to sealing it. But after the trial, when the document was disclosed 

to Korelitz and he moved for a new trial, the judge determined that the agreement 

was not collusive and denied the motion. After reading the agreement and 

reviewing the record, we also are convinced that the parties to the agreement were 

not in collusion. 

{¶ 16} The court of appeals read much into the hospital’s decision to 

oppose bifurcation of the trial, which would have separated the issue of 

negligence from the issue of intentional destruction of evidence, and the hospital’s 

decision to excuse a juror who was potentially sympathetic to the defendants. 

Although it is always possible to second-guess trial tactics, the trial court was in a 

better position than the court of appeals to determine the motives of counsel and 

whether collusion was behind their decisions, because he observed counsel and 
January Term, 2009 

7 

witnesses while the court of appeals reviewed a cold record. In denying Hodesh’s 

posttrial motions to revoke the agreement and to grant a new trial, the trial court 

wrote, “[T]here was no evidence that [the hospital] remained as only a nominal 

Defendant which conspired with [Hodesh] to the detriment of Dr. Korelitz. The 

positions of [Hodesh] and the hospital remained adversarial at all times.” 

Other Considerations 

{¶ 17} A fact that must be considered whenever one defendant makes an 

allegation of collusion between his codefendant and the plaintiff is that 

codefendants often attempt to blame each other. Part of the defense for both the 

hospital and Korelitz in this case is that the other defendant was to blame for the 

towel having been left in Hodesh’s abdomen. That the hospital attempted to show 

that Korelitz was responsible was no more evidence of collusion than Korelitz’s 

attempt to convince the jury that the hospital staff was to blame. The legal 

positions of codefendants are often antithetical and adversarial. Plaintiffs benefit 

when codefendants attempt to blame each other; that, standing alone, is not 

evidence of collusion. 

Conclusion 

{¶ 18} For all the reasons above, we conclude that the agreement between 

Hodesh and the hospital was not collusive and that the trial court did not abuse its 

discretion in refusing to disclose the agreement to the jury. We reverse the 

judgment of the court of appeals on this issue. Several issues that were raised in 

the court of appeals were mooted by that court when it determined that the 

agreement should have been disclosed. Those issues now need to be addressed. 

Accordingly, we remand the cause to the court of appeals with instructions to 

consider those issues. 

Judgment reversed 

and cause remanded. 
SUPREME COURT OF OHIO

8 

 MOYER, C.J., and LUNDBERG STRATTON, O’CONNOR, O’DONNELL,

LANZINGER, and CUPP, JJ., concur. 

__________________ 

 Bruce Whitman, for appellant. 

 Tucker, Ellis & West, L.L.P., and Irene C. Keyse-Walker; and Triona, 

Calderhead & Lockemeyer and David Calderhead, for appellees Joel Korelitz, 

M.D., and Cincinnati General Surgeons, Inc. 

 Paul W. Flowers Co., L.P.A., and Paul W. Flowers; and Elk & Elk Co., 

Ltd., and Peter D. Traska, urging reversal for amicus curiae Ohio Association of 

Justice. 

 Rendigs, Fry, Kiely & Dennis, L.L.P., Jeffrey M. Hines, and Karen A. 

Carroll, urging reversal for amici curiae Jewish Hospital of Cincinnati and Health 

Alliance of Greater Cincinnati. 

_____________________