Also, Plaintiff Correctly Was Not Saddled With Routine Costs Against One Settling Defendant.
In an interesting case for lemon law practitioners where correction offers and CCP § 998 offers are involved, the appellate court in Elikov v. Hyundai of Folsom, LLC, Case No. C099253 (3d Dist. Apr. 30, 2026) (unpublished) affirmed a denial of attorney’s fees to plaintiff and a motion to strike costs by plaintiff as against one defendant.
What happened here is that plaintiff purchased a used car from Folsom Lake Hyundai and was incorrectly told the car had not been in any prior accidents. Plaintiff’s counsel sent a CLRA notice to three Hyundai affiliates (dealer, lender, and manufacturer) as well as Hartford insurance seeking to resolve the CLRA claims, subsequently filing a court action. Dealer responded to plaintiff’s CLRA notice with correction offers to reimburse all payments made on the car, extinguish the vehicle loan, cover plaintiff’s repairs and associated damages, waive its right to offset for vehicle use, and pay plaintiff reasonable fees and costs, although plaintiff had to return the vehicle in substantially the same condition at the time of purchase (unfortunately, post-purchase, plaintiff rented the car to others and post-sale accident damages were incurred). Dealer and Hartford sent a joint 998 offer to Plaintiff offering to refund all car monthly payments, refund a downpayment, pay for plaintiff’s repairs, pay off the existing car loan, pay plaintiff’s reasonable fees and costs via stipulation or court application, and waive any offset for car use—an offer not accepted. However, dealer, lender, and Hartford accepted plaintiff’s 998 offers to have judgment entered against them for $5,000.
Judgment was entered against the three defendants based on the 998 offer acceptances. Defendants and plaintiff filed costs memoranda and dueling motions to strike/tax costs, and plaintiff filed an attorney’s fees request under CLRA and the Song-Beverly Act.
The lower court granted both motions to strike/tax costs and denied plaintiff’s fee request because (1) plaintiff was precluded for costs recovery under CLRA based on Benson v. Southern Cal. Auto. Sales, Inc., 239 Cal.App.4th 1198 because he rejected an appropriate CLRA corrections and offer; (2) plaintiff was not entitled to fees under the Song-Beverly Act; and (3) defendants were not entitled to recover costs because plaintiff obtained a more favorable judgment than the joint 998 offer. Plaintiff appealed the fee denial, while dealer cross-appealed from the order granting plaintiff’s motion to strike/tax costs.
All challenged rulings were affirmed on appeal.
Fee Denial to Plaintiff. In deciding plaintiff prevailing status under CLRA, a pragmatic approach governs by determining which party achieved its litigation objectives by judgment, settlement, or otherwise. Because plaintiff did not obtain an injunction under CLRA, the focus was on his damages claims. Here, dealer made no liability concession and made no concession on the appropriateness of the corrections offer—meaning the focus was on whether the defense corrections offer was inappropriate. The lower court’s conclusion that the corrections offer was reasonable, because it offered to undo the transaction and pay plaintiff attorney’s fees, was no abuse of discretion, especially given that plaintiff did not notify defendant about the post-purchase damages. As to fees under the Lemon Law, the appellate court agreed that the lower court could find Benson instructive with respect to its denial of fees under the Song-Beverly Act.
Dealer’s Cross-Appeal of Denial of Routine Costs Against Plaintiff. This hinged on whether the joint 998 offer dollar amount was more favorable than the eventual judgment. Although the lower court erred by aggregating the settlement amount made by another defendant, it reached the proper conclusion because the judgment amount versus the 998 offer amount was greater given that preoffer costs were “a wash” for both sides.