Second District, Division 5 Finds Offer Was Made In Good Faith Under Abuse of Discretion Standard.
Code of Civil Procedure section 998 offers can be tough and can completely shift the leverage in a particular case. Although the offers must be made in good faith, they must be evaluated carefully. The next one was low but found to be in good faith, much to the chagrin of the losing plaintiff who did not accept the offer.
In Javaheri v. Aum, L.P., Case No. B206898 (2d Dist., Div. 5 Sept. 15, 2009) (unpublished), plaintiff sued defendant neighbors for claimed damage to plaintiff’s building during defendants’ excavation of a nearby condominium project. Plaintiff lost after a jury trial, with the trial court awarding defendants $163,760 in costs (all of the requested amount, including substantial expert witness fees). The costs award was based on plaintiff’s rejection of a 998 offer by defendants to end the case in return for a $1,001 payment to plaintiff.
On appeal, the costs order was affirmed. The standard of review was determinative, because a “good faith” determination in this context is a discretionary call for the lower court and reviewed under the abuse of discretion standard. (Arno v. Helinet Corp., 130 Cal.App.4th 1019, 1025 (2005).) Nothing in the record “jumped out” at the appellate panel to lead it to disturb the exercise of discretion below, even though the 998 offer was small and made early in the litigation (before expert depositions were taken). The defendant had apparently evaluated the case properly, determining no damages were appropriate (an evaluation shared by the jury). The Court of Appeal was not about to use “hindsight” to find the offer other than in good faith.