998 Settlement Offer attorney fees Elite Show Services v. Staffpro

Code of Civil Procedure-Section 998 Settlement Offer attorney fees
Elite Show Services v. Staffpro

1.         Section 998

            As a general rule, a prevailing party in a civil action is entitled to recover its costs from its opponent.  (§ 1032.)  However, section 998 establishes a procedure for shifting costs if the prevailing party obtains a judgment less favorable than a pretrial settlement offer made by the other party.  (Barella v. Exchange Bank (2000) 84 Cal.App.4th 793, 798 (Barella).)  In that situation, the prevailing party is precluded from recovering its own postoffer costs and must pay its opponent's postoffer costs, including expert witness fees, if awarded in the court's discretion.  (Ibid., citing § 998, subd. (c)(1).)  The purpose of the cost-shifting statute is to encourage the settlement of litigation without trial, by punishing the party who fails to accept a reasonable settlement offer from its opponent.  (Carver v. Chevron U.S.A., Inc. (2002) 97 Cal.App.4th 132, 152.)

            Where the offeror obtains a judgment more favorable than its offer, the judgment constitutes prima facie evidence showing the offer was reasonable and the burden lies with the offeree to show that the offer was not in fact reasonable.  (Carver v. Chevron U.S.A., Inc., supra, 97 Cal.App.4th at p. 152.)  However, in seeking to enforce an offer pursuant to section 998, the offering party bears the burden of demonstrating that the offer was otherwise valid.  (Barella, supra, 84 Cal.App.4th at p. 799.)  An offer will be strictly construed in favor of the party against whom it would operate under section 998 and although the inclusion of nonmonetary terms and conditions therein does not necessarily render an offer invalid, the offer must be unconditional to be enforceable.  (Barella, supra, 84 Cal.App.4th at p. 799.)

Elite Show Services v. StaffproD042195 attorney fees

Jun 08 2004

D042195 [PDF] [DOC]

Elite Show Services v. Staffpro 6/8/04 CA4/1

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