What Is A 998 Offer?

Do not overwork to be rich;

Because of your own understanding, cease!

Will you set your eyes on that which is not?

For riches certainly make themselves wings;

They fly away like an eagle toward heaven.

-Proverbs

 

What is a 998 offer? It’s a settlement offer with teeth.

A 998 offer allows a party to shift costs to the other party. It’s based on CCP § 998. The 998 offer is generally only good for 30 days.

You make a 998 offer by using the required statutory language under CCP § 998 and related case law.

Here’s how it works from the Plaintiff side:

  • Plaintiff sends Defendant a $50,000 998 offer on June 1.
  • Defendant doesn’t accept the offer by July 1 (30 days later). The 998 offer is now closed.
  • Plaintiff prepares for trial, spending $15,000 in costs.
  • Plaintiff goes to trial and wins. The jury awards Plaintiff $55,000.
  • Plaintiff has “beat” the $50,000 998. Plaintiff should be able to recover some (possibly not all) of the $15,000 in costs.

If, however, Defendant accepted the $50,000 998 offer before July 1, then the case should be over.

Here’s how it works from the Defendant side:

  • Defendant sends Plaintiff a $10,000 998 offer on June 1.
  • Plaintiff doesn’t accept the offer by July 1 (30 days later). The 998 offer is now closed.
  • Defendant prepares for trial, spending $15,000 in costs.
  • Defendant goes to trial and wins. The jury awards nothing to Plaintiff.
  • Defendant has “beat” the $10,000 998. Defendant should be able to recover some (possibly not all) of the $15,000 in costs.

If, however, Plaintiff accepted the $10,000 998 offer before July 1, then the case should be over.

Of course, it can become complicated. (e.g. if there are multiple plaintiffs and defendants, joint and several liability, calendar extensions, whether the 998 offer was in “good faith,” whether there’s been a “more favorable judgment,” etc).

What’s important to know is that a 998 offer is a settlement offer with teeth because it allows a party to shift costs to the other party.

Questions? Contact Me for a free consultation.

Evan Walker

Evan W. Walker is a La Jolla attorney who has practiced law since 2008. He has practiced law throughout California, Connecticut, and Louisiana.

Evan worked for and defended insurance companies during the first 7 years of his practice. Since 2015, he has represented people with personal injury and property damage claims and insurance disputes.

Evan’s practice is devoted to serious personal injury claims and catastrophic property damage claims. Areas of focus include security claims against bars and other businesses, government tort claims, fire and flood claims, and inverse condemnation. On behalf of clients, Evan has fought insurance firms, international companies, cities, bars, and casinos.

Evan regularly shares his expertise with other attorneys by teaching courses on insurance and inverse condemnation. He has taught several continuing legal education courses to Attorney Credits, a nationwide CLE company, and ProLawCLE, another nationwide CLE company. He also contributes to various podcasts and publications.

Associations:

  • Member, State Bar of California
  • Member, San Diego Bar Association
  • Member, Consumer Attorneys of California
  • Member, Consumer Attorneys of San Diego
  • Member, La Jolla Bar Association
  • Member, La Jolla Village Merchants Association
  • Member, San Diego Chamber of Commerce