Opinion
F083989
07-31-2023
LAURENCE MITCHELL LITTLE et al., Plaintiffs and Appellants, v. DAVINDER SINGH et al., Defendants and Respondents.
Law Office of Ralph B. Wegis, Ralph B. Wegis, and Edward Gordon for Plaintiffs and Appellants. Lewis Brisbois Bisgaard &Smith, John S. Lowenthal, Dana Alden Fox; Greines, Martin, Stein & Richland, Robert Olson, and Joseph V. Bui for Defendants and Respondents.
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of Kern County No. BCV-17-101322. Thomas S. Clark, Judge.
Law Office of Ralph B. Wegis, Ralph B. Wegis, and Edward Gordon for Plaintiffs and Appellants.
Lewis Brisbois Bisgaard &Smith, John S. Lowenthal, Dana Alden Fox; Greines, Martin, Stein & Richland, Robert Olson, and Joseph V. Bui for Defendants and Respondents.
OPINION
POOCHIGIAN, ACTING P. J.v
BACKGROUND
In a complaint filed June 13, 2017, plaintiffs Laurence Mitchell Little and Susan Little sued defendants Davinder Singh ("Singh") and U.S. Freight Carrier, LLC ("U.S. Freight") for damages arising out of a vehicle collision. The complaint alleged Singh was operating his vehicle "negligently and carelessly" - including by traveling at an unsafe speed, talking on a cell phone, and running a red light - resulting in a collision with Mr. Little's vehicle. The complaint alleged all defendants, including U.S. Freight Carrier, LLC, "carelessly, negligently, and recklessly owned, leased, maintained and operated the tractor trailer combination so as to directly, legally and proximately cause it to collide with" Mr. Little's vehicle.
U.S. Freight Carrier, LLC was initially named as Doe 1, but was substituted in via an amendment filed in August 2017. Another defendant, Wabash National, was later dismissed and is not party to the present appeal. Future references to "defendants" are to Davinder Singh and U.S. Freight Carrier, LLC only.
In discovery responses, defendants stated that Singh was driving for U.S. Freight at the time of the collision.
Singh's discovery response was dated March 23, 2018. U.S. Freight's discovery response was dated June 1, 2018.
By the eve of trial, defendants were not contesting liability. Also, by the time of trial, plaintiffs abandoned their claims for economic damages, such as lost earnings (past or future) or medical bills (past or future).
A jury trial was conducted to determine noneconomic damages.
By special verdict, the jury awarded plaintiffs $10 million in damages. To Mr. Little, they awarded $2 million in past noneconomic damages and $5 million in future noneconomic damages. The jury awarded Susan Little $1 million in past noneconomic damages and $2 million in future noneconomic damages.
Plaintiffs appeal a trial court order taxing costs arising pursuant to an offer under Code of Civil Procedure section 998.
All further statutory references are to the Code of Civil Procedure unless otherwise stated.
We incorporate by reference the facts described in our nonpublished opinion in Little et al. v. Singh et al. (July 31, 2023, F083583). (See In re Ruedas (2018) 23 Cal.App.5th 777, 783.)
I. The Section 998 Offer was Invalid
A. Background
On August 31, 2018, plaintiffs served an offer to compromise on defendants. The offer read, "Plaintiffs Laurence Mitchell Little and Susan Little, hereby offer, pursuant to ... section 998, to have a judgment entered against Davinder Singh &U.S. Freight Carrier, LLC, and in favor of Plaintiffs, Laurence Mitchell Little and Susan Little, in the amount of one million dollars ($1,000,000.00)." (Capitalization omitted.)
The offer further provided that it would remain open for the period prescribed by section 998 and that "in the event that Defendants decline to accept this offer, and in the further event that judgment after trial equals or is less than the same of this offer, Plaintiffs will seek to recover all costs allowable under" section 998.
At the same time, plaintiffs sent defendants a form on which they could indicate acceptance of the section 998 offer, with blanks for a signature and date. The acceptance form stated, "NOTICE IS HEREBY GIVEN that Defendants DAVINDER SINGH and U.S. FREIGHT CARRIER, LLC, accept the Code of Civil Procedure section 998 Offer to Compromise made by Plaintiffs in the above-entitled action for the sum [of] One Million dollars ($1,000,000.00), each party to bear their own costs and attorney's fees." The form had a single signature line for the attorney that represented both defendants.
A trial was held in September 2021 after which a jury awarded plaintiffs a total of $10 million in damages.
In a memorandum of costs, plaintiffs sought $3,083,333.33 in prejudgment interest pursuant to the section 998 offer. (See Civ. Code, § 3291.) Defendants moved to tax this prejudgment interest claim, among others.
The trial court ruled that plaintiffs' section 998 offer was invalid and that plaintiffs were not entitled to recover prejudgment interest or expert fees. Plaintiffs appeal.
B. Law
Section 998 provides, in part, "[A]ny party may serve an offer in writing upon any other party to the action to allow judgment to be taken or an award to be entered in accordance with the terms and conditions stated at that time. The written offer shall include a statement of the offer, containing the terms and conditions of the judgment or award, and a provision that allows the accepting party to indicate acceptance of the offer by signing a statement that the offer is accepted. Any acceptance of the offer, whether made on the document containing the offer or on a separate document of acceptance, shall be in writing and shall be signed by counsel for the accepting party or, if not represented by counsel, by the accepting party." (§ 998, subd. (b).)
If a defendant does not accept the offer and the plaintiff obtains a more favorable judgment, the court may require defendant to pay certain postoffer expert costs. (§ 998, subd. (d).) Additionally, the judgment is deemed to have been accruing prejudgment interest at the rate of 10 percent per annum from the date of the first offer. (Civ. Code, § 3291.)
Multiple Offerees
"It has long been held that a section 998 offer is effective to shift liability for costs only where the offer was properly allocated as to multiple offerees and was made in a manner allowing individual offerees to accept or reject it. [Citation.] This rule has been applied to both plaintiff and defendant offerors, and both where the offer is explicitly and impliedly conditioned on joint acceptance by the offerees." (Menees v. Andrews (2004) 122 Cal.App.4th 1540, 1544 (Menees).)
We construe the offer strictly in favor of defendants, and it is plaintiffs' burden as appellants to establish that the section 998 offer was valid when made. (See Menees, supra, 122 Cal.App.4th at p. 1546.)
C. Analysis
As noted above, section 998 offers to multiple offerees must be (1) expressly apportioned and (2) made in a manner allowing individual offerees to accept or reject it. (Menees, supra, 122 Cal.App.4th at p. 1544.) Plaintiffs' offer fails on both fronts.
Apportionment
First, the offer is not expressly apportioned among Singh and U.S. Freight. Rather, the offer was for $1 million to both defendants without apportionment.
"When concurrent tortfeasors are sued, the various defendants risk liability exposure to the plaintiff and are subject to comparative indemnity claims among themselves." (Taing v. Johnson Scaffolding Co. (1992) 9 Cal.App.4th 579, 584.) "If a settlement demand to multiple codefendants is apportioned or segregated as to each or any of them, any such defendant can accept the demand and seek a good faith settlement determination." (Ibid.; see § 877.6.) However, the same is not true of an unapportioned offer, which requires each defendant to obtain the concurrence of the other offeree defendants. (Taing v. Johson Scaffolding Co., at p. 584.) Such unapportioned offers are invalid because they are not "sufficiently specific to permit [each] individual defendant to evaluate it and make a reasoned decision whether to accept without the additional burden of obtaining the acceptance of codefendants or suffering from their refusal to settle ..." (Id. at p. 585, italics added.)
Because the offer here identified a single sum and was directed to both defendants, it was not apportioned as required.
Plaintiffs counter that the offer need not have been apportioned here, pursuant to cases like Brown v. Nolan (1979) 98 Cal.App.3d 445, because "where defendants are sued upon a theory of joint and several liability, each is potentially liable for the full amount of any judgment." They then point to a motion filed by defendants on October 16, 2020, wherein U.S. Freight admitted vicarious liability for Singh's acts and omissions. They also point to defendants' discovery responses indicating Singh was driving for U.S. Freight at the time of the collision.
At best, these documents would only establish that U.S. Freight is liable for Singh's acts and omissions (e.g., speeding, running the red light). They do not establish that Singh is vicariously liable for U.S. Freight's acts and omissions (e.g., negligently owning or maintaining the vehicle driven by Singh). For this reason, plaintiffs have not shown that this is a case where each defendant would be liable for the full amount of any judgment. Consequently, cases involving joint and several liability as to all tort claims are inapplicable, and instead the general rule requiring apportionment applies. (See Burch v. Children's Hospital of Orange County Thrift Stores, Inc. (2003) 109 Cal.App.4th 537, 549-551.) The section 998 offer here was invalid because it failed to apportion the offer among the defendants.
Offer Did Not Provide for Individual Acceptance by Each Offeree/Defendant
Second, the offer was not "made in a manner allowing individual offerees to accept or reject it." (Menees, supra, 122 Cal.App.4th at p. 1544.)
Defendants contend that plaintiffs forfeited their arguments on this issue by failing to adequately raise them in their opening brief. Because we reject plaintiffs' position on the merits, we do not address forfeiture.
The offer said plaintiffs would seek section 998 costs in the event that "Defendants" - plural - declined to accept the offer. Moreover, plaintiffs accompanied the offer with an acceptance form which stated, "NOTICE IS HEREBY GIVEN that Defendants DAVINDER SINGH and U.S. FREIGHT CARRIER, LLC, accept the ... section 998 Offer to Compromise made by Plaintiffs in the above-entitled action for the sum [of] One Million dollars ($1,000,000.00), each party to bear their own costs and attorney's fees." (Italics added.) Below this text was a single signature line for the attorney that represented both defendants.
In these respects, the present case is quite like the one we encountered in Menees, supra, 122 Cal.App.4th 1540. In that case, as here, "the offer was made in a single document, which referred to [the offerees] in the conjunctive. Provided with the offer was another document, the notice of acceptance, which again referred to [the offerees] in the conjunctive and, quite tellingly, provided only one signature line - for the attorney who represented both of them." (Id. at p. 1546.) We held in Menees the offer was invalid because it did not provide for individual acceptance by each offeree. We see no grounds to distinguish Menees.
Because the offer was conditioned on acceptance by both defendant/offerees, it was invalid.
DISPOSITION
The order taxing costs claimed under section 998 is affirmed. Defendants shall recover costs on appeal.
WE CONCUR: DETJEN, J. SMITH, J.