Offer In Personal Injury Case Requiring Satisfaction of Liens/Encumbrances Did Not Render 998 Offer Uncertain In Nature; Defense Garnered $41,020.76 Costs Upon Review In Modified Reversal.
The Third District in Velasquez v. Koshi, Case No. C072767 (3d Dist. Feb. 9, 2015) (unpublished) involved a situation where a personal injury plaintiff rejected a defense statutory CCP § 998 offer of $75,000, but only won damages from a jury of $18,000. Dueling cross-motions for costs were filed by both sides, with the lower court determining that the defense 998 offer was uncertain (hence, unenforceable) such that plaintiff was awarded $17,995.58 (some preoffer/some postoffer costs) and the defense’s $48,090.96 costs request was struck in entirety. The defense appealed the denial of its costs motion, but did not appeal the award of costs to plaintiff.
The defense cross-appeal of the costs denial was successful.
The precise issue was whether the 998 offer inclusion of the descriptor “with plaintiff and/or her attorney to satisfy any liens or encumbrances” as a part of the personal injury suit settlement was too indefinite as far as the risk plaintiff was absorbing in assessing the outstanding 998 offer.
Given that the offer was not subject to any extrinsic evidence and contractual interpretation principles applied, de novo review was warranted.
The appellate court found that the 998 offer was not uncertain. This case was much different than Valentino v. Elliott Sav-On Gas, Inc., 201 Cal.App.3d 692 (1988), which involved the release of potential claims not even at issue in the pending case. However, it was much closer to Elite Show Services, Inc. v. Staffpro, Inc., 119 Cal.App.4th 263 (2004) [inclusion of fee clause in 998 offer was not uncertain] and Linthicum v. Butterfield, 175 Cal.App.4th 259 (2009) [release of all current claims in a pending lawsuit between parties proper in 998 offer]. However, the “clincher” was that plaintiff was in a superior position to know about medical or attorney liens to be resolved such that it should not infect a 998 offer in a particular pending case with uncertainty.
So, the appellate court determined the math to avoid another remand: after netting preoffer costs to plaintiff (given no cross-appeal of this order) against applicable preoffer costs to the defense awardable under section 998, the defense obtained a “net” judgment of $41,020.76 as a conclusion to this entire appeal.
BLOG BONUS—If you want to see a prior discussion of 998 terms which under case law will and will not pass “uncertainty” muster, see our post of July 2, 2014.