Testify Into Coverage Truthfully



All witnesses must testify truthfully. One who willfully gives false testimony may be guilty of perjury.[1] The cooperation clause of a policy requires the policyholder to provide true facts to enable the insurer to evaluate a claim and decide whether to resist or settle the claim.[2] The obligation to testify truthfully may require a defendant to support a valid claim by the plaintiff and neither an insurer nor its lawyers may properly assert that such truthful testimony violates the cooperation clause nor constitutes collusion.[3] Because the insurer may sue its own policyholder to recover reimbursement of defense and settlement costs for non-covered claims,[4] the policyholder may actually benefit by truthful testimony that supports covered liability. Accordingly, it is required by law, allowed by the cooperation clause, and may be advantageous to the policyholder to give truthful testimony which supports liability to the plaintiff for conduct that is covered by the policy.


A witness who willfully gives false testimony under oath is guilty of the crime of perjury. The California Penal Code provides in part: “Every person who, having taken an oath . . . willfully and contrary to the oath, states as true any material matter which he or she knows to be false . . . is guilty of perjury.” (§118)[5] “It is no defense . . . that “the accused did not know the materiality of the false statement”.” (§123.) “An unqualified statement of that which one does not know to be true is equivalent to a statement of that which one knows to be false.” (§125.) “Perjury is punishable by imprisonment.” (§126.)

Policyholder’s Duty to Tell the Truth

“The insurer is entitled to know from its assured the true facts (of which he may have knowledge) underlying an accident and upon which the injured person bases his claim in order that it may determine for itself, in the light of such information, whether it should contest or attempt to settle the claim. Our examination of many authorities indicates the general rule to be that under a cooperation clause the assured is required to give a fair and frank disclosure of information reasonably demanded by the insurer to enable it to determine whether there is a genuine defense. (Citations.) Many other decisions to the same effect might be cited. In [one], it is stated: ‘The company is entitled, however, to an honest statement by the insured of the pertinent circumstances surrounding the accident, as he remembers them. Lacking that, the company is deprived of the opportunity to negotiate a settlement, or to defend upon the solid ground of fact. Nothing is more dangerous than a client who deliberately falsifies the facts.’”[6]

A Plaintiff May Not Assert a False Claim

A plaintiff who asserts a claim without sufficient factual support may be guilty of malicious prosecution. Probable cause to file a complaint may turn on “the threshold question of the [underlying plaintiff’s] factual knowledge or belief. [If the underlying plaintiff knew] that the factual allegations on which his action depended were untrue . . . the trial court can determine the legal question whether such facts constituted probable cause to institute the challenged proceeding.”[7] Thus, a plaintiff may not properly assert a false claim.

A Defendant May Not Assert a Sham Defense

Correspondingly, neither an insurer nor a defendant may falsely testify to undermine a valid plaintiff’s claim. Defense counsel “who willfully procures another person to commit perjury is guilty of subornation of perjury.”[8] Thus, both the defendant and defense counsel must not falsely resist a valid claim of injury. “Of course. . . a cooperation clause may not be expanded to require the assured ‘to combine with the insurer to present a sham defense.’”[9]

Being knowledgeable in substantive and procedural law, litigation attorneys frequently draft pleadings, declarations, affidavits, and discovery responses for the client to verify under penalty of perjury. Lawyers also frequently coach their clients how to testify, including advising the client the impact that substantive testimony may have on issues of liability and damages. However, the policyholder should be mindful of the possible impact sworn testimony in the plaintiff’s lawsuit may have on coverage. Testimony prepared by defense counsel and verified by the policyholder may be offered into evidence to undermine the policyholder’s coverage.[10]

Plaintiffs and Defendants May Truthfully Testify Into Coverage

When true facts support a plaintiff’s claim, the defendant is both morally compelled and legally required to give truthful testimony to support the plaintiff’s claim. In addition, an insurer’s coverage challenge may create incentives for a policyholder to confess covered liability.[11] When “some of the claims are at least potentially covered and the others are not,”[12] the policyholder actually benefits if liability is found for covered claims rather than non-covered claims.

[5] All references in this paragraph are to the Penal Code.

[6] Valladao v. Fireman’s Fund Indem. Co. (1939) 13 Cal.2d 322, 329.

[7] Sheldon Appel v. Albert & Oliker (1989) 47 Cal. 3d 863, 881.

[8] Penal Code § 127.

[9] Valladao v. Fireman’s Fund Indem. Co. (1939) 13 Cal.2d 322, 329.

[10] “When the liability . . . of a party to a civil action is based . . . upon the liability . . . of the declarant, . . ., evidence of a statement made by the declarant is as admissible against the party as it would be if offered against the declarant in an action involving that liability.” (Evid. Code § 1224.)

[12] Buss v. Superior Court 16 Cal.4th 35, 47.

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