Section 998: $10,000 CCP § 998 Offer Was Reasonable And Made In Good Faith In Automotive Friction Case Where Defense Prevailed Against 4 Plaintiffs

 

$185,741.82 Was Costs Hit Against Plaintiffs, $167,570 Of Which Was Expert Witness Expenses.

     The next case teaches plaintiffs in difficult causation cases to carefully evaluate Code of Civil Procedure section 998 offers made by remaining defendants close to trial. Their rejection of an aggregate $10,000 offer, with a proposed mutual waiver of costs, resulted in plaintiffs being ordered to pay costs to defendant totaling $185,741.82.

     Adams v. Ford Motor Co., Case No. B225791 (2d Dist., Div. 1 Sept. 29, 2011) (unpublished) involved Ford’s section 998 offer of $10,000 ($2,500 to each of four plaintiffs) in an automotive friction case (decedent husband/father was exposed to asbestos while working as a “shade tree mechanic” [a mechanic who maintains and repairs his vehicles himself] on Ford cars with components containing asbestos) which plaintiffs lost after a jury trial. That meant that Ford’s section 998 offers were not beat. The lower court subsequently awarded Ford total costs of $185,741.82, which included $167,570 in expert witness fees. Plaintiffs appealed.

 

 

[Drives ancient "Lizzie" to White House to show Henry Ford. Washington, D.C., April 27. His 1921 Model T Ford polished to a mirror like finish, Ernest A. Franke, elderly Washingtonian, drove to the White House executive offices today with intentions of showing the ancient model to Henry Ford. "Where's Henry" shouted Franke, from the driver's seat, "I want to show him his old car". Police declines to allow Franke to await the arrival of Ford who was due to have lunch with President Roosevelt, 4/27/38.  Library of Congress.]

     The costs award was affirmed in a 3-0 panel decision authored by Justice Johnson.

     The main issue was whether the 998 offer was reasonable and made in good faith. It was, because the settlement offer was somewhat in the ballpark of previous settlements made by other defendants and had an important feature aside from the low monetary amount, namely, an offer to mutually waive costs (costs, which it turned out, where substantial given that Ford presented persuasive, but expensive, expert testimony). Ford’s win was prima facie evidence of reasonableness, supplemented by evidence that automotive frictions cases were fraught with causation proof problems.

     Plaintiffs also argued that the defense could not receive post-offer expert witness fees, but this was wrong. Although true for prevailing plaintiffs, Regency Outdoor Advertising, Inc. v. City of Los Angeles, 39 Cal.4th 507, 532-533 (2006) foreclosed that argument because the lower court does have discretion to award alll expert witness fees, pre- and post-offer, to prevailing defendants.

     The trial court, during the motion to tax costs, did express some concern that the expert witness fees were very high. However, in supplemental papers, Ford presented evidence of comparable expert witness fees it had incurred in other product liability cases, provided the court with evidence that plaintiffs’ experts charged similarly hourly rates as its experts, presented evidence of several defense verdicts in automotive friction cases against auto manufacturers requiring the work of expert witnesses, and had presented its lead trial counsel’s declaration attesting to the reasonableness of the expert fees based on his experience. Pretty good showing, we would say, which is how both the trial and appellate courts also saw it.