New York's highest court recently considered whether a plaintiff and defendant who enter into a high-low agreement in a multi-defendant action (frequently referred to as a "Mary Carter Agreement") must disclose the terms of that agreement to the court and the remaining parties. While these agreements are used routinely, with and without disclosure to all parties, this appears to have been an issue of first impression in NY. The New York Court of Appeals found that the failure to disclose the terms of the agreement to all parties "prejudiced the determination of the rights and liabilities of the non-agreeing defendant at trial" and ordered a new trial on liability and damages. It appears, therefore, that parties entering into high-low agreements in multi-defendant actions must now disclose the existence of such agreements and their terms to the court and the non-agreeing defendants or risk an order for a new trial. A fully copy of the decision is attached here.