Plaintiff’s Inclusion of Acceptance Terms Being Filed With Court Meant 998 Offers Were Not Valid Statutory Offers, But Were Valid Non-Statutory Offers Not Accepted Correctly.
Arreola v. Napole, Case No. B239467 (2d Dist., Div. 7 Oct. 15, 2013) (unpublished) is an interesting case of 998 offers which likely were not authorized, but in a “no harm, no foul” situation were not validly accepted non-statutory settlement offers, such that their invalidity from a statutory point did not make a difference.
In this one, there was a real mix-up involving a personal injury plaintiff, with very substantial injuries, where plaintiff’s counsel mistakenly communicated “low-ball” 998 offers even though much higher offers should have likely been sent. Interestingly enough, the 998 offers required the accepting party to not only accept but also file the offer/acceptance notices with the court prior to trial or within 30 days after the offer was made. The defense accepted in time, but did not file the acceptances with the trial court–faxing and sending them by mail to plaintiffs’ counsel
A big brouhaha developed in which the lower court basically entered judgment based on the 998 offers which were faxed and mailed to counsel. Plaintiff distanced herself from the settlements and forwarded much larger 998 offers, but the defense 998 offer amounts were entered as the judgment ($1 million).
The appellate court reversed, but in doing so had some interesting things to say about the validity of plaintiff’s mistaken 998 offers.
Here, the 998 offers were valid because they contained an additional acceptance caveat not contained in the statute–the notices of acceptance had to be filed with the court within 30 days of the offers, something not specified in section 998. This means the offers were defective.
However, this did not mean the offers were not valid “non-statutory” offers. The defense did not accept the offers by filing with the court, such that the offers were not accepted according to their terms. Judgment reversed based on offer/acceptance contractual principles.