## Facts

- Plaintiffs brought wrongful death and personal injury claims arising from an automobile accident that fatally injured Frank Stallman.
- Plaintiffs served a California Code of Civil Procedure § 998 offer to multiple defendants for $225,000, stating “each side to bear its own costs.”
- Defendants did not accept the offer.
- After trial, the jury returned a single verdict for plaintiffs of $224,500.
- Plaintiffs sought ordinary prevailing-party costs, expert witness fees under § 998(d), and prejudgment interest under Civil Code § 3291.
- The trial court awarded ordinary costs and expert witness fees but denied prejudgment interest, reasoning the verdict did not exceed the $225,000 offer because the offer stated each side would bear its own costs.
- Plaintiffs appealed the denial of prejudgment interest and the comparison methodology; a defendant cross-appealed the award of expert witness fees.

## Issues

1. Whether a single, joint § 998 offer to multiple defendants is valid when it does not allocate the offer among defendants.
2. Whether, for a plaintiff’s rejected § 998 offer, a “more favorable judgment” comparison includes the plaintiff’s ordinary recoverable costs in addition to the jury verdict.
3. Whether an offer term stating “each side to bear its own costs” prevents including ordinary costs in the “more favorable judgment” comparison after the offer is rejected.

## Decision

- The Court of Appeal held the joint § 998 offer was valid because the case resulted in a unitary verdict that permitted a certain comparison between total offer and total recovery.
- The court held that, for a plaintiff-offeror, the “more favorable judgment” calculation includes the verdict plus the plaintiff’s ordinary recoverable costs (excluding § 998 enhancement items).
- The “each side to bear its own costs” language was construed as a proposed settlement term only and did not waive statutory cost rights if the offer was rejected.
- Because the verdict plus ordinary costs exceeded $225,000, plaintiffs satisfied the “more favorable judgment” requirement, supporting expert witness fees under § 998(d).
- The court reversed the denial of prejudgment interest under Civil Code § 3291 and remanded for proper calculation consistent with including costs in the comparison.

## Legal Principles

- A joint plaintiff § 998 offer to multiple defendants is not invalid per se when the resulting judgment is unitary and allows a clear numeric comparison of offer and recovery.
- For a plaintiff’s rejected § 998 offer, “judgment” for determining whether the plaintiff obtained a more favorable result includes ordinary costs recoverable by the prevailing party, but not § 998 enhancement items.
- A rejected § 998 offer’s “each side to bear its own costs” term is treated as part of the proposed compromise and does not bar statutory cost recovery or the use of costs in determining whether the plaintiff beat the offer.
- When a plaintiff obtains a more favorable judgment than a rejected § 998 offer, Civil Code § 3291 requires prejudgment interest from the date of the offer.

## Conclusion

The court validated plaintiffs’ joint § 998 offer and held that, in comparing a plaintiff’s recovery to a rejected § 998 offer, the verdict must be combined with ordinary recoverable costs; because that total exceeded the offer, plaintiffs were entitled to § 998 expert witness fees and mandatory prejudgment interest under Civil Code § 3291.


Stallman v. Bell, 235 Cal. App. 3d 740, 286 Cal. Rptr. 755 (Ct. App. 1991)