Attorney's Fees After 998 Offers and Dismissals

Here's the second of the 2008 cases we'll mention today that pertain to attorney's fees In Chinn v. KMR Property Management (2008) 166 Cal.App.4th 175, which did not involve wage and hour issues, Plaintiff accepted an offer to compromise pursuant to Code of Civil Procedure section 998,  agreeing to dismiss her tort action in exchange for a monetary payment.  After entry of the order of dismissal, the trial court awarded costs to plaintiff, but denied recovery of attorney fees. Plaintiff appeals the award of costs, contending that she is entitled to additional costs and an award of attorney fees based on a broadly worded attorney fee provision in her lease agreement and as the prevailing party with a net monetary recovery under the cost provisions of section 1032.

A section 998 compromise agreement that requires a dismissal of the action and waives the defendant’s costs is silent as to a plaintiff’s ability to recover costs.  However, here, defendants are the prevailing parties for the purposes of an award of costs under section 1032, because a dismissal was entered in defendants’ favor. Regardless of which party is entitled to an award of costs under section 1032, the trial court has discretion after a voluntary pretrial dismissal to determine whether there is a prevailing party for the purpose of an award of contractual attorney fees incurred in a tort action.

Therefore, the Court of Appeal reversed the portion of the judgment denying plaintiff’s motion for entitlement to attorney fees as against the defendant and remanded that issue to allow the trial court to exercise its discretion. In all other respects, the trial court's rulings were affirmed.

A petition for review was filed, and was denied by the Supreme Court. You can download the full text of the opinion here in PDF or Word format.

Comments

[Account Deleted]

hi sir i like your site .The offer was open for less than a week before it expired according to its terms. The trial court bifurcated the trial to adjudicate the issue of liability based on alter ego prior to determining damages. After the landlord rested on the alter ego liability phase of trial, the corporation moved for judgment. The landlord filed a voluntary dismissal of the action with prejudice before the issuance of any ruling on the pending motion. The trial court concluded that the corporation was not entitled to attorney fees under either California Civil Code § 1717 (which addresses attorney's fees in contract actions), or California Code of Civil Procedure § 998 (which addresses attorney’s fees resulting from certain conditions related to an offer to compromise/settle a case)thanks .......

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blc
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StiveWaugh
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attorney--attorneyhe corporation made an offer in writing to settle the case.