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What Do Tax Returns Have To Do With a Car Accide

What Do Tax Returns Have To Do With a Car Accide

In a personal injury lawsuit, the credibility of the parties and their supporting witnesses often prove crucial to the outcome. A jury (or judge) must not only reconstruct the events surrounding a car accident; they must also decide which side is more believable in general. This means that attorneys for plaintiffs and defendants alike must gather as much as information as they can in order to undermine the credibility of the opposing side.

Even a simple car accident can lead attorneys to look at all areas of a plaintiff’s or defendant's life and conduct. A recent decision by the Appellate Division, Fourth Department, provides an apt example. In this case, there was a two-car accident, and the driver of one vehicle sued the other to recover damages for serious injuries sustained. The case was tried before a jury in Onodaga County Supreme Court, which returned a verdict for the plaintiff and awarded total damages in excess of $300,000.

But in a decision issued on September 26 of this year, the Fourth Department reversed the jury's decision and ordered a new trial. The Fourth Department agreed with the defendant that the trial judge improperly prevented her attorney from questioning the plaintiff on an issue that, to an outside observer, might seem wholly unrelated to the accident—her tax returns.

Specifically, the defendant had reason to believe the plaintiff lied on her federal tax returns. The defendant's attorney wanted to question the plaintiff on this issue during cross-examination. Those questions would have addressed the plaintiff's filing status as head of her household and the number of dependency exemptions claimed for her children. The defense wanted to show the plaintiff misled the Internal Revenue Service in order to claim a tax credit for which she was not actually eligible.

But the trial judge shut the defense inquiry down. The court felt this amounted to an unfair “ambush,” as the plaintiff was not previously questioned about her tax returns during pre-trial discovery. The defendant objected to the judge's decision, which later became the subject of her appeal to the Fourth Department.

In its decision, the Fourth Department said the trial judge erred by not allowing the questions. The defendant had a “good faith basis” to question the plaintiff's tax returns. If, in fact, the plaintiff lied on her returns, that would suggest “the possibility that she may have committed tax fraud,” which, in turn, would cast doubt on her credibility as a witness with respect to the car accident. While attorneys may not go on wild goose chases during cross examination, they are allowed to question witnesses with respect to specific acts of “moral turpitude.”

It should be noted that attorneys are not permitted to introduce additional or outside evidence on points unrelated to the issue at trial. In other words, if the defense attorney asked the plaintiff about her tax returns, and she denied any impropriety, the defense could not then introduce outside evidence of tax fraud. New York courts do not permit such evidence. But, as the Fourth Department observed, that does not preclude the defense from simply asking the plaintiff if she committed tax fraud.

The lesson here is that you must be prepared to answer all sorts of questions about your personal conduct if you become involved in a personal injury lawsuit. An experienced New York accident lawyer can help thoroughly prepare you for what may happen when you sit before a judge and jury. Contact our office today if you have any questions.

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