Daily Blast March 2, 2016

The Court of Appeal, Second Appellate District, Division Six (Ventura), issued an opinion in Toste v. CalPortland Construction (Mar. 2, 2016, B256946) __ Cal.App.4th __, analyzing whether the recent amendment of Code of Civil Procedure section 998 (“section 998”) applies to an award of preoffer expert witness fees. (Slip opn., p. 14.) The Court of Appeal reversed the trial court’s cost award order because the newly amended section 998 does not apply to preoffer expert fees.

(Id. at pp. 15-16.)

This case arose from injuries sustained by decedent after defendant truck driver backed up a construction truck and hit decedent during a road paving project. Decedent’s father sued the truck driver, his employer and the asphalt supplier. (Slip opn., p. 1.) Before trial, the truck driver and his employer made two offers to compromise ($200,001 and $750,001) and the asphalt supplier made one offer ($15,000). Plaintiff rejected all the offers. (Id. at p. 2.) The case was submitted to the jury based on three theories of negligence: (1) the truck driver violated federal or state law (by testing positive for marijuana) and was negligent per se; (2) the truck driver drove a truck with a faulty backup alarm; and (3) the truck driver backed up in a negligent manner. (Id. at p. 5, fn. 3.) The jury returned a special verdict finding the truck driver negligent, but that his negligence was not a substantial factor in causing the harm. (Id. at p. 1.) Plaintiff moved for new trial based on insufficiency of the evidence and juror misconduct. The trial court denied plaintiff’s new trial motion and awarded expert witness fees based on the pretrial offers to compromise. (Id. at p. 3.) Plaintiff appealed.

The Court of Appeal affirmed the judgment in favor of defendants, but reversed the cost award in favor of the truck driver and his employer and remanded for reconsideration in light of the newly amended section 998. (Slip opn., p. 2.) The court determined that defendants’ offers to compromise were valid offers, except for the truck driver’s and the employer’s first offer ($200,001)—it was conditional and invalid. (Id. at p. 13.) The court determined that since the truck driver’s and employer’s first offer was invalid, their cost award required recalculation based on the newly amended statute. (Id. at p. 16.) 

“Before the 2015 amendment, section 998 vested the trial court with the discretion to award expert witness fees [to defendant] as a cost item where the fees are incurred before and after the section 998 offer to compromise is served on and rejected by the plaintiff. (Slip opn., p. 15.) On the contrary, plaintiffs could “only be awarded postoffer expert witness fees when the defendant rejected the plaintiff’s settlement offer and failed to receive a more favorable judgment or award at trial.” (Ibid., italics in original.) The new amendment “equalizes the costs for plaintiffs and defendants in 998 settlement situations” and “‘requires a plaintiff to cover only expert witness costs that arose postoffer.’” (Ibid., additional citation omitted.) The Court of Appeal held that the section 998 amendment applies to cases pending on appeal. (Ibid.)

The amendment did not affect the asphalt supplier’s cost award because it incurred only postoffer expert witness fees. The amendment did, however, impact the truck driver’s and the employer’s cost award because the trial court awarded expert fees that preceded the second valid offer to compromise. As such, the Court of Appeal reversed the cost award for the trial court to reconsider the expert fees in light of the newly amended section 998. (Slip opn., p. 16.)

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