Generally, a statutory offer to compromise under Code of Civil Procedure section 998 that is made to multiple defendants must be expressly apportioned amongst each of the defendants identified in the offer, and cannot be conditioned on acceptance by all of the defendants in order to be deemed valid. However, in 1996, the Court in Steinfeld v. Foote-Goldman Proctologic Medical Group, Inc. (1996) 50 Cal.App.4th 1542, held that when a plaintiff pursues a single theory of liability against multiple defendants for a single injury and where the defendants would be jointly and severally liable as joint tortfeasors, an unapportioned statutory offer to compromise is still valid.
Here, in Anthony v. Li, 2020 WL 1847109, Plaintiff filed a complaint for “motor vehicle” and “general negligence” against a driver and the owner/entruster of a vehicle. After voluntarily dismissing the owner/entruster of the vehicle, Plaintiff served a statutory offer to compromise seeking a judgment against both the driver and the owner/entruster for a certain lump sum of money. At trial, Plaintiff succeeded in obtaining a judgment against the driver for an amount greater than his statutory offer to compromise. He subsequently filed a memorandum of costs seeking to recover over $62,000 in post-offer expert witness fees. At the hearing on the driver’s motion to tax costs, the trial court agreed to tax Plaintiff’s request for post-offer expert fees because it determined the statutory offer to compromise was joint and unapportioned.
On appeal, the Court reaffirmed the general rule that an offer made to multiple defendants cannot be conditioned on acceptance by all of the defendants. Since Plaintiff’s 998 offer sought to take a judgment for one lump sum against both the driver and the owner/entruster and not against one or the other, it was presumably conditioned on acceptance by both defendants and was invalid as a matter of law. Although not addressed by the Court of Appeal, it did not seem to matter that the owner/entruster arguably fell under the exception carved out by Steinfeld v. Foote-Goldman Proctologic Medical Group, supra.
The Court of Appeal also held Plaintiff’s statutory offer to compromise was invalid because it was directed at a dismissed party – the owner/entruster. Since the dismissal of the owner/entruster had the effect of an absolute withdrawal of the party from the action, no court would have had jurisdiction to act against that party. Further the Court of Appeal noted that even though recent authority permitted Plaintiff to direct a statutory offer to compromise to an insurer, the Plaintiff’s offer made no indication that by simply naming the owner/entruster, he intended the owner/entruster to be held responsible as the insurer of the driver. In other words, there was insufficient information in the statutory offer to compromise to advise the defendants of the plaintiff’s intention to hold the owner/entruster responsible as the driver’s insurer.
In the end and perhaps due to Plaintiff’s innocent mistake, the trial court’s order invalidating the plaintiff’s statutory offer to compromise was affirmed, thereby costing Plaintiff over $62,000 in expert fees.
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