No Piggybacking on a Co-Defendant's 998

Litt v. Eisenhower Med. Ctr., No. D067455 (D4d1 Jun. 19, 2015)

Plaintiff got hurt in a hospital cafeteria. Defendant 1, the hospital, served a Code of Civil Procedure § 998 offer of judgment on Plaintiff for $15,000, which plaintiff rejected. Plaintiff subsequently amended his complaint to add Defendant 2, the cafeteria operator. Under the cafeteria contract, Defendants 2 agreed to indemnify Defendant 1 in cases like this one. At trial, plaintiff won a $3,000 verdict, joint and several against both defendants.

Trial court holds that, for the purposes fee shifting under § 998, Defendant 1—which served the offer—is a prevailing party. But Defendant 2—which didn’t serve an offer—is not. So only Defendant 1 gets to recover its post-offer costs. But it taxeed Defendant 1’s expert witness fees because under the cafeteria contract, those fees were indemnified by Defendant 2.

On appeal, the first point is easy. A defendant that doesn’t serve a § 998 offer and loses a net recovery at trial is not a prevailing party, in any sense of that term. But the trial court erred in taxing Defendant 1’s expert witness fees. The costs statute permits the award of costs incurred, even if not paid, and § 998 shifts incurred costs. A bunch of cases in the insurance context bear out that a plaintiff can recover expert witness fees, even if the bill was paid by someone else. So Defendant 1 should have recovered its expert witness fees, even if, at the end of the day, it wasn’t on the hook to pay them. The fact that the obliged indemnitor was also a defendant in the case and not, ultimately, a prevailing party on its own, didn’t make a difference.

Reversed in part.