Offeree, Although Might Prudently Ask For Clarification, Is Under No Legal Obligation To Ask For Clarification Of Section 998 Offer.
The defense in an automobile personal injury accident case involving two plaintiffs made a CCP § 998 offer to the more severely injured plaintiff which was conditioned upon “the execution and transmittal of a Settlement Agreement and Release of All Claims by PLAINTIFF in favor of DEFENDANTS; that Settlement Agreement and Release of All Claims to be drafted by counsel for the DEFENDANTS.” The trial judge, after the severely injured plaintiff obtained a favorable jury verdict, found the section 998 offer to be uncertain, awarding $29,000 in costs to plaintiff and denying the defense $160,000 in requested costs.
The Fourth District, Division 2 affirmed the uncertainty determination in Soliz v. City of Big Bear Lake, Case No. E067555 (4th Dist., Div. 2 July 16, 2019) (unpublished).
Relying on Sanford v. Rasnick, 246 Cal.App.4th 1121, 1131-1132 (2016), the appellate court concluded that the offer was invalid because it was conditioned on an undescribed and unrevealed settlement agreement, unlike the situation in Fasberg Construction Co. v. Housing Authority of City of Los Angeles, 152 Cal.App.4th 720, 765 (2007) where the section 998 offer included the proposed settlement agreement so that the offeree could evaluate the full terms of the 998 offer. The defense tried to argue that the offeree was obligated to seek clarification of the offer, but the 4/2 DCA panel found no such legal obligation to exist given that the offeror is responsible for ensuring that the 998 offer is valid. In response to the argument that not requiring the offeree to ask for clarification would discourage settlement of lawsuits, the Court of Appeal answered that this was untrue because an offeree risks that a lower court might find an offer to be valid if the offeree does not ask for clarification—in a word, the offeree also has risks in not seeking clarification.