Woodland Hills personal injury lawyer Barry P. Goldberg frequently comments on proper uses and tactics of C.C.P § 998 Offers to Compromise. In fact, it is one of the few very useful tools left for a personal injury attorney to prompt or force a settlement with a third party in litigation. Moreover, C.C.P § 998 Offers to Compromise are very useful in Uninsured Motorist and Underinsured Motorist Arbitration cases.
Section 998, subdivision (c)(1) now provides in pertinent part:
“If an offer made by a defendant is not accepted and the plaintiff fails to obtain a more favorable judgment or award, the plaintiff shall not receive his or her postoffer costs and shall pay the defendant’s costs from the time of the offer. In addition, . . . the court or arbitrator, in its discretion, may require the plaintiff to pay a reasonable sum to cover postoffer costs of the services of expert witnesses, who are not regular employees of any party, actually incurred and reasonably necessary in either, or both, preparation for trial or arbitration, or during trial or arbitration, of the case by the defendant.” (Emphasis added.)
Before the 2015 amendment, section 998 vested the trial court with the discretion to award expert witness fees as a cost item where the fees were incurred before and after the section 998 offer to compromise was served on and rejected by the plaintiff. (See Wegner et al., Cal. Practice Guide. Civil Trials and Evidence (The Rutter Group 2015) § 17:121, p. 17-58.; Murillo v. Fleetwood Enterprises, Inc. (1998) 17 Cal.4th 985, 1000; Regency Outdoor Advertising, Inc. v. City of Los Angeles (2006) 39 Cal.4th 507, 533, fn. 13 [discussing how section 998 treats defendants more favorably than plaintiffs].) Commentators agreed that it was a legislative oversight because plaintiffs could only be awarded postoffer expert witness fees when the defendant rejected the plaintiff’s settlement offer and failed to receive a more favorable judgment or award at trial.
The law, which became effective January 1, 2016, equalizes the costs for plaintiffs and defendants in 998 settlement situations. The Legislative Counsel’s Digest comment states: “This bill would clarify that this provision requires a plaintiff to cover only expert witness costs that arose postoffer.” (6 West’s, Cal. Legislative Service 2015, ch. 345, p. 3281.)
The subtlety is easy to miss and the case law on C.C.P § 998 Offers to Compromise interpret the pre-amended statute. Plaintiff attorneys should keep the new law in mind both when receiving a C.C.P § 998 Offer to Compromise from a defendant and when serving a C.C.P § 998 Offer to Compromise on a defendant.
