The Defense Did Not Timely Withdraw Its Offer Before Acceptance, And The 998 Offer Did Contemplate Entry Of A Judgment Based On The Parties’ Conduct.
Courts encourage settlements and acceptance of CCP § 998 offers, if structured correctly. They generally do not honor untimely attempted withdrawals of those offers after acceptance. That is what occurred in Yehoshua v. American Roofing and Gutters, Inc., Case No. B333020 (2d Dist., Div. 1 Aug. 2, 2024) (unpublished).
What happened in this case was that plaintiff accepted defendants’ section 998 offer. Defendants tried to withdraw it after acceptance. Then, after eight rounds of submitting proposed judgments by plaintiff, the lower court entered judgment by which money was accepted by plaintiff (plus reasonable attorney’s fees and costs to be determined by motion), one defendant’s cross-complaint was dismissed, defendants waived claims against plaintiff and his counsel, and plaintiff had judgment entered on his complaint. (Defendants did not raise the argument that no entry of judgment was contemplated under the section 998 until their objection to the fifth proposed judgment.)
Defendants’ appeal of the judgment based on the section 998 acceptance was unsuccessful. Defendants argued that the section 998 offer was not accepted until the notice of acceptance was filed with the lower court. That argument was rejected because section 998 only provides that the notice of acceptance is filed after the offer is accepted, an act not required for acceptance to occur prior to filing of the notice. Although the offer was ambiguous as to whether entry of judgment was contemplated, the parties’ subsequent conduct demonstrated that this was the case given that defendants waited more than a year to raise this objection after five rounds of proposed judgments were submitted.
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