Pomeroy v. Zion

California Court of Appeal Aug 23, 1971 No. Civ. 29033Published

Before: Devine

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Holding. Section 998 of the Code of Civil Procedure is an independent settlement device from Section 997, and the trial court has discretion to award or deny costs under Section 998. When a party invokes Section 998 in a settlement offer, they are bound by the discretionary nature of that statute and cannot later rely on the mandatory cost provisions of Section 997.

Issues

Whether Section 998 of the Code of Civil Procedure is independent of Section 997.
Whether a trial court has discretion to deny costs under Section 998.
Whether a party who invokes Section 998 in a settlement offer is bound by its discretionary provisions.

Disposition. affirmed

Quotations verified verbatim against the opinion

“We conclude that section 998 creates a new device for settlements and one that is independent of section 997.”

“The rejection of an offer creates potential sanctions by force of a particular statute. Having invoked the statute, appellants must stand by their choice.”

“Section 998 of the Code of Civil Procedure gives the court discretion in determining whether or not to allow the defendant to recover any costs.”

[475]

Opinion

DEVINE, P. J.

This appeal calls for construction of section 998 of the Code of Civil Procedure, a section enacted in 1969 which has not been interpreted previously.

There are two sections which provide for allowance or disallowance of costs following an offer to compromise. Section 997 has been effective and has been altered but slightly since the adoption of the Code of Civil Procedure in 1872, and enactment of its predecessor (which the code took over unchanged) 100 years ago. (Stats. 1851, ch. 5, § 390, p. 113.) At the time of the order appealed from (Aug. 10, 1970) the statute read, as it does now: “The defendant may, at any time before the trial or judgment, serve upon the plaintiff an offer to allow judgment to be taken against him for the sum or property, or to the effect therein specified. If the plaintiff accepts the offer, and gives notice thereof within 10 days, he may file the offer, with proof of notice of acceptance, and the clerk, or the judge where there is no clerk, must thereupon enter judgment accordingly. If the notice of acceptance be not given, the offer is to be deemed withdrawn, and cannot be given in evidence upon the trial; and if the plaintiff fails to obtain a more favorable judgment, he cannot recover costs, but must pay the defendant’s costs from the time of the offer. Any judgment entered pursuant to this section is deemed to be a compromise settlement.” (Stats. 1969, ch. 277, § 1, p. 626.)

In 1969, there was enacted section 998, which reads: “Not less than 10 days prior to commencement of the trial as defined in subdivision 1 of Section 581, or at any settlement conference presided over by a judge of the court in which the action is pending, any party may serve an offer in writing to allow judgment to be taken in accordance with the terms and conditions stated at that time. If such offer is accepted, the judge shall enter judgment accordingly. If such offer is not accepted prior to trial or within 30 days after it is made, whichever occurs first, it shall be deemed withdrawn, and cannot be given in evidence upon the trial. If the party to whom the offer of judgment is made fails to obtain a more favorable judgment, he cannot recover costs, and the court

may

Pomeroy v. Zion

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DEVINE, P. J.

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