Commercial Litigation and Arbitration

The Limits of Stipulation — Yes, There Are Things Parties Cannot Stipulate to

In re Deepwater Horizon, 753 F.3d 516 (5th Cir. 2014) (Clement, J., dissenting):

Even with the assent of all parties, judges still have the obligation to reject stipulations that are not factually true. See People v. Marling, 116 Cal. App. 3d 284, 172 Cal. Rptr. 109 (Ct. App. 1981) ("Although a rose is a rose, a cactus is not and a stipulation does not make it so.") They may also do so because the parties cannot stipulate to law: they cannot force a court through stipulation "to decide a case according to a body of law that is nowhere in force." Cent'l Soya Co. Inc. v. Epstein Fisheries, Inc., 676 F.2d 939, 941 (7th Cir. 1982) (Posner, J.); see also Reeg v. Shaughnessy, 570 F.2d 309, 314 (10th Cir. 1978) ("It is settled that parties cannot stipulate that the law of a forum will not control, but that other law will control.") This purported stipulation has ended up being either factually or legally untrue. It either trumpets one lie (businesses operating hundreds of miles from any sign of befouled water had injury "caused by" BP) or another (a party can stipulate away the legal requirement of causation). But parties cannot stipulate to force courts to decide cases based on "a body of law that is nowhere in force" or to declare a cactus a rose. There are limits on party autonomy and judicial efficiency, because a stipulation, like any other judicially enforced agreement, derives its force from the power of the court and its enforcement should not "discredit the judiciary." Charles Alan Wright and Kenneth W. Graham, Fed. Prac. & Proc. Evid. § 5194.

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