The Burden of Proving the Burden of Proof

We all know that the default burden of proof standard in civil cases is the “preponderance of evidence” standard. In explaining this standard to a jury, many of us resort to the proverbial tipping of Lady Justice’s scales. We also know that fraud claims require proof by the higher “clear and convincing” standard. Imitations of Lady Justice do not work as well with this standard, but we still manage to explain the heightened burden of proof.
While it appears to be simple to determine when each of the standards applies, there are scenarios in complex commercial tort cases when the answer is not so clear. For example, suppose you represent a plaintiff seeking to obtain an award of actual or possibly even treble damages against a defendant who took money from your client. Which standard will you have to meet? This is an important determination, as it is far easier to meet the preponderance of evidence standard than the clear and convincing standard.
Neuman Anderson knows about this scenario from first-hand experience, having recently won a jury verdict for a law firm that sued one of its former officers and directors for taking a significant amount of money from the firm without authorization. We asked the jury to find the defendant liable for embezzlement and statutory conversion.
While submitting jury instructions, a legal debate ensued concerning one of the common law elements for embezzlement. Specifically, to prove embezzlement, a plaintiff is required to prove that the defendant “intended to ‘defraud’ or cheat the plaintiff”. Defense counsel argued that because this element included a reference to “defraud”, the plaintiff was required to prove its case by clear and convincing evidence.  As you might imagine, there was no legal authority on point to address this question. We argued that because we only intended to prove that the defendant intended to “cheat” the plaintiff, and agreed to delete any reference to “defraud” from the jury instructions, the burden of proof remained the preponderance of evidence standard. The trial court agreed with our position.
Applying the trial court’s instructions, the jury quickly returned with a verdict in favor of the plaintiff on both the embezzlement and statutory conversion claims. Furthermore, the jury not only awarded our client the entire sum of money the defendant wrongfully took, they also awarded our client treble damages and attorney fees.
The verdict resulted from how favorably the jury viewed our witnesses, how well the proofs went in and, of course, our highly skillful advocacy. While all of those things played a part, we cannot forget the role that the lower burden of proof standard played. The lesson here is that the applicable burden of proof, and how it is embodied in your jury instructions, can make a huge difference in a commercial tort trial.
To learn more, contact Leif Anderson directly at [email protected]