Trujillo v. City of L.A. ( 2022 )

Filed 10/27/22
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION TWO
ANA ISABELLA TRUJILLO, B314042
Plaintiff and Appellant, (Los Angeles County
Super. Ct. No.
v. 19STCV08109)
CITY OF LOS ANGELES,
Defendant and
Respondent.
APPEAL from the judgment of the Superior Court of Los
Angeles County, Daniel M. Crowley, Judge. Affirmed.
Law Offices of Vahdat & Associates, G. Amy Vahdat, and
Kevin M. Davis for Plaintiff and Appellant.
Michael N. Feuer, City Attorney, Scott Marcus, Assistant
City Attorney, Blithe S. Bock, Managing Assistant City Attorney,
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and Michael M. Walsh, Deputy City Attorney, for Defendant and
Respondent.
******
A defendant sued for negligence moves for summary
judgment and makes a settlement offer pursuant to Code of Civil
Procedure section 9981 (a 998 offer) days before the hearing on its
summary judgment motion. Mere minutes after the trial court
orally grants summary judgment, the plaintiff zips off an email to
the defendant purporting to accept the 998 offer. This scenario
presents the following question: Does a 998 offer automatically
expire when a trial court orally grants the offeror’s summary
judgment motion? We hold that that answer is “yes.” Because
the trial court came to the same conclusion, we affirm.
FACTS AND PROCEDURAL BACKGROUND
I. Facts
Around 11 p.m. on a Sunday night in July 2018, Ana
Isabella Trujillo (plaintiff) decided to go for a jog with her sister.
She took a route she had run over 100 times before. This time,
however, she tripped on an uneven sidewalk in front of a house
on Pickford Street in the City of Los Angeles (the City). The
seam between two sidewalk squares where she tripped was offset
between .75 and 1.0625 inches. Plaintiff fell and sustained
injuries.
The City had not received any complaints or requests for
repair for this stretch of sidewalk.
1 All further statutory references are to the Code of Civil
Procedure unless otherwise indicated.
2
II. Procedural Background
A. Plaintiff sues
In March 2019, plaintiff sued the City for its negligence in
maintaining the City-owned sidewalk in a dangerous condition.2
B. City moves for summary judgment
In September 2020, the City moved for summary judgment
on the ground that the sidewalk was not a “dangerous condition”
because the differential in elevation between the two sidewalk
squares was trivial—and hence, not “dangerous”—as a matter of
law.
After a full round of briefing, the trial court set a hearing
for March 2, 2021, at 2:30 p.m. Although the hearing was not
transcribed, the trial court concluded the hearing by orally
granting the City’s motion for summary judgment. The hearing
ended at approximately 3:18 p.m. “Upon conclusion of the oral
argument,” the court issued a minute order memorializing its
oral ruling.
C. The City’s 998 offer
A few days before the March 2, 2021 hearing on its
summary judgment motion, the City had sent plaintiff a 998 offer
to settle the case for $30,000.
At 3:22 p.m. on March 2, 2021, just four minutes after the
summary judgment hearing concluded, plaintiff’s counsel sent
the City an email purporting to accept the City’s 998 offer. Seven
minutes after that—at 3:29 p.m.—plaintiff filed the executed 998
offer with the court.
2 Plaintiff also named the County of Los Angeles as a
defendant, but the record on appeal is unclear as to what
occurred with respect to that party.
3
On March 3, 2021, the City objected to plaintiff’s attempt to
accept its 998 offer after the trial court had ruled on its summary
judgment motion. The next day, plaintiff filed a written reply to
the City’s objection.
D. Entry of judgment
On May 7, 2021, the trial court entered judgment for the
City, implicitly ruling that plaintiff’s acceptance of the City’s 998
offer was inoperative.
E. Litigation regarding validity of plaintiff’s
postruling acceptance of the 998 offer
1. Plaintiff’s motion to compel
On May 10, 2021, plaintiff filed a motion to compel the trial
court to enter judgment in accordance with the terms of the 998
offer plaintiff purported to accept. Following a full round of
briefing, the trial court held a hearing on June 4, 2021. The court
denied the motion. The court explained that it had orally “issued
a ruling granting [the City’s] [m]otion for [s]ummary [j]udgment
on the merits,” that its oral ruling “reflect[ed] a determination . . .
that [plaintiff’s] action . . . has no merit,” and that the ruling
accordingly “terminated [p]laintiff’s power to accept [the City’s]
[o]ffer,” such that plaintiff’s “purported acceptance of the [998
o]ffer did not form a valid compromise agreement.”
2. Plaintiff’s motion for reconsideration
On May 24, 2021, and while simultaneously litigating her
motion to compel, plaintiff filed a motion for reconsideration of
the trial court’s entry of its May 7, 2021 judgment. Following yet
another full round of briefing, and yet another hearing, the trial
court denied the motion on the ground that plaintiff’s motion did
not satisfy the prerequisites for a motion for reconsideration
because it was merely a “reiteration of [plaintiff’s] original motion
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[to compel]” and did not raise “any new or different facts,
circumstances, or law.”
F. Appeal
On July 8, 2021, plaintiff filed a timely notice of appeal of
the May 7, 2021 judgment.
DISCUSSION
Section 998 is a statutory mechanism meant to “encourage
both the making and the acceptance of reasonable settlement
offers” “prior to trial.” (Scott Co. v. Blount, Inc. (1999) 20 Cal.4th
1103, 1114; Bank of San Pedro v. Superior Court (1992) 3 Cal.4th
797, 804.) It does so by creating “a strong financial disincentive
to a party—whether plaintiff or defendant—who fails to achieve a
better result than that party could have achieved by accepting his
or her opponent’s settlement offer.” (Bank of San Pedro, at p.
804.) Specifically, section 998 authorizes the parties in a civil
lawsuit—whether plaintiff or defendant—to make a written offer
of settlement 10 or more days “prior to commencement of trial or
arbitration” of their “dispute.” (§ 998, subd. (b).) Such an offer
expires “30 days after it is made.” (Id., subd. (b)(2).) If the offer
is accepted within this time window and “prior to trial or
arbitration,” the trial court must “enter judgment” consistent
with the offer. (Id., subd. (b)(1) & (2).) If the 998 offer is made by
the defendant and the plaintiff “fails to obtain a more favorable
judgment” than contained in the 998 offer, then the plaintiff
suffers a penalty—namely, the plaintiff cannot collect any of her
own postoffer costs and must pay the defendant’s postoffer costs,
and these amounts reduce the amount of any verdict in the
plaintiff’s favor. (§ 998, subds. (c)(1) & (f).) If the 998 offer is
made by the plaintiff and the defendant “fails to obtain a more
favorable judgment or award,” then the defendant suffers a
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penalty, namely, the defendant has to pay the plaintiff’s postoffer
costs and has to pay the “postoffer costs of the services of [the
plaintiff’s] expert witnesses.” (§ 998, subd. (d).)
In arguing that the trial court erred in refusing to
acknowledge plaintiff’s acceptance of the City’s less-than-30-day-
old 998 offer, this appeal presents the following question: When,
if at all, does a trial court’s grant of summary judgment cause a
party’s outstanding 998 offer to expire? The parties have offered
up a veritable smorgasbord of possible answers, including (1)
when the summary judgment hearing commences, (2) when the
court orally rules, (3) when the court memorializes its oral ruling
in a minute order, (4) when the court enters judgment, or (5)
never, at least as long as 30 days have not expired after the 998
offer is made. Because ascertaining the correct answer turns on
questions of statutory interpretation, we confront the issue de
novo. (Lopez v. Ledesma (2022) 12 Cal.5th 848, 857.)
We conclude that a still-pending 998 offer expires when a
trial court orally grants summary judgment.
Two considerations inform our analysis.
First, we look to section 998’s text, which is the ‘“most
reliable indicator”’ of our Legislature’s intent when enacting
section 998. (Mejia v. Reed (2003) 31 Cal.4th 657, 663.) The text
of section 998 provides that a 998 offer may be made “prior to
commencement of [(1)] trial or [(2)] arbitration . . . of a dispute to
be resolved by arbitration.” (§ 998, subd. (b), italics added.)
Because the sole purpose of trial is also to resolve disputes
(Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843), a
section 998 offer may only be made when there exists a dispute to
be resolved. As our Supreme Court has said time and again, a
grant of summary judgment resolves all the disputes in a case.
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(Blair v. Pitchess (1971) 5 Cal.3d 258, 284 [“The purpose of
summary judgment is to determine whether or not a genuine
factual controversy exists between the litigants and if not, to
resolve their dispute without a full-scale trial . . . .”], superseded
by statute on other grounds as described in Simms v. NPCK
Enterprises, Inc. (2003) 109 Cal.App.4th 233, 242-243; Aguilar, at
p. 843 [“The purpose of the law of summary judgment is to
provide courts with a mechanism to cut through the parties’
pleadings in order to determine whether . . . trial is in fact
necessary to resolve their dispute.”].) Indeed, that is why the
grant of summary judgment is entitled to preclusive effect in
future litigation. (Cf. Schulze v. Schulze (1953) 121 Cal.App.2d
75, 83 [denial is not preclusive].)
Second, we look to the purpose animating section 998,
which also guides our interpretation of the statute. (Selga v.
ASICS America Corp. (2022) 12 Cal.5th 651, 662.) As noted
above, the purpose of section 998 is to encourage the early
settlement of disputes. Settlement is the means by which parties
can achieve the certainty of a known outcome and simultaneously
eliminate the uncertainty that inheres in litigation. (Pazderka v.
Caballeros Dimas Alang, Inc. (1998) 62 Cal.App.4th 658, 667
[“‘“Compromise” . . . reflects the settling parties’ temporal
resolution of the risks of suit between them.”’]; see Blue Ridge
Ins. Co. v. Jacobsen (2001) 25 Cal.4th 489, 503 [noting that
settlement occurs when outcomes are “uncertain”].) If a party
has the option of accepting a settlement offer even after a court
has resolved the dispute the litigation presents, then that party
has no incentive whatsoever to accept that offer before the court
does so; a rational party given that option would simply “wait and
see” how the court rules: If it prevails, it can still accept the offer
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on its still-live claims; and, if it loses, it can accept the offer as a
way to resurrect its defunct claims. Giving parties this option
would not only fail to encourage early settlement, it would
actively discourage early settlement and would thus be wholly
antithetical to the very purpose animating section 998. We must
not construe section 998 to sanction such an absurd result.
(Meleski v. Estate of Holden (2018) 29 Cal.App.5th 616, 626
[rejecting interpretation of section 998 that “lead[s] to absurd
results.”].)
Because a dispute is resolved and the outcome of the
litigation becomes certain and known once a trial court issues its
oral ruling granting summary judgment, that is the point in time
at which both the text and purpose of section 998 dictate that any
pending section 998 offer is no longer operative.
We reject the other points in time proffered by the parties.
Plaintiff urges that a party may accept a less-than-30-day-
old section 998 offer up until the point at which the court enters
judgment and, indeed, even after the court enters judgment. The
law is to the contrary. The statute defining summary judgment
provides that a grant of summary judgment is effectuated “by
written or oral order”; entry of judgment is not required. (§ 437c,
subd. (g); In re Steiner (1955) 134 Cal.App.2d 391, 398; accord,
Gardenswartz v. Equitable Life Assurance Soc. (1937) 23
Cal.App.2d Supp. 745, 754.) What is more, a rule allowing the
losing party to accept a pending 998 offer after the trial court has
granted summary judgment against it—just because the court
has yet to enter judgment (or even after)—would, as noted above,
encourage parties to “wait and see” how the court rules and then
to accept or reject the offer depending on the court’s ruling; we
decline to construe section 998 to empower such gameplaying.
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(Martinez v. Brownco Construction Co. (2013) 56 Cal.4th 1014,
1021 [section 998 must not be interpreted to “encourage
gamesmanship”] (Martinez).)
The City urges that a party loses the right to accept a 998
offer once a summary judgment hearing commences, invoking by
analogy the statutory provision that 998 offers expire at the
“commencement of trial or arbitration.” (§ 998, subd. (b)(2) &
(3).) The analogy does not hold. To begin, summary judgment is
not a substitute for trial. (Walsh v. Walsh (1941) 18 Cal.2d 439,
444; Cone v. Union Oil Co. (1954) 129 Cal.App.2d 558, 562.)
More to the point, section 998’s language that a 998 offer expires
at the commencement of a trial makes sense—even if the
outcome of the trial is not yet known—due to the commitment of
judicial resources a trial entails. Summary judgment hearings do
not entail such a commitment of resources; thus, a 998 offer
remains valid after such a hearing commences until the trial
court orally issues a ruling.
The last proffered point in time is the issuance of a minute
order that memorializes the trial court’s oral summary judgment
ruling. To be sure, the case law regarding whether a trial court’s
oral ruling is “effective” as a general matter seems to be divided,
with some cases indicating oral rulings are sufficient for some
purposes and others indicating a minute order is required.
(Compare Brown v. Superior Court (1925) 70 Cal.App. 732, 735
[court ruling “complete when it is pronounced by the court”];
accord, People v. Mesa (1975) 14 Cal.3d 466, 471 [oral
pronouncement controls over written minutes] with In re
Marriage of Drake (1997) 53 Cal.App.4th 1139, 1170 [“oral ruling
on a motion does not become effective until it is . . . entered in the
minutes”]; Pacific Home v. County of Los Angeles (1953) 41 Cal.2d
9855, 857 [same, as to order ruling on a motion for new trial].) But
this split is not controlling here. The summary judgment statute
allows for a grant of summary judgment to be made “by written
or oral order” (§ 437c, subd. (g)), which suggests a trial court’s
oral ruling in this context is effective. What is more, there is
inevitably a gap in time between the trial court’s oral ruling and
the ministerial and clerical task of entering the minute order that
reduces that oral ruling to writing; if, as plaintiff urges, we were
to construe section 998 to allow a party to accept a pending 998
offer during that window, we would be undermining section 998’s
purpose and empowering gameplaying for the reasons explained
above. Construing section 998 in this manner would also be sure
to create uncertainty because trial courts do not typically
timestamp their minute orders, allowing parties to do precisely
what plaintiff did in this case—that is, to claim to have accepted
the City’s 998 offer in the uncertain and usually unknowable gap
of time between the court’s oral ruling and the entry of the
minute order. Our Supreme Court has urged courts not to
construe section 998 in a way that would “spawn disputes over
[its] operation.” (Martinez, supra, 56 Cal.4th at p. 1021.)
The trial court properly concluded that the City’s 998 offer
expired by the time plaintiff purported to accept it. Like any
other contractual offer, a 998 offer is not accepted until that
acceptance is communicated to the offeror. (Bias v. Wright (2002)
103 Cal.App.4th 811, 818 [so holding]; Gray v. Stewart (2002) 97
Cal.App.4th 1394, 1397 [so holding]; see generally, Civ. Code, §
1565; Hofer v. Young (1995) 38 Cal.App.4th 52, 56 [“It is . . .
hornbook law that an acceptance of an offer must be
communicated to the offeror to become effective”].) The trial
court here implicitly found that plaintiff did not communicate her
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acceptance of the City’s 998 offer until after the court had orally
granted the City’s summary judgment motion. Although
plaintiff’s counsel at some points suggested that he
communicated his acceptance before the trial court orally ruled
(by indicating that he “filed and served” plaintiff’s “acceptance” of
the 998 offer “[a]s the [summary judgment] hearing . . . was
concluding,” substantial evidence supports the trial court’s
factual finding that plaintiff did not communicate her acceptance
until after the oral ruling because the record elsewhere indicates
that all plaintiff’s counsel did during the hearing was instruct his
paralegal to file and serve the 998 offer, because the hearing
ended at 3:18 p.m., and because the email communicating
plaintiff’s acceptance was sent to the City at 3:22 p.m. (In re
Caden C. (2021) 11 Cal.5th 614, 630 [“factual determinations
[are] properly reviewed for substantial evidence”].) Because
plaintiff did not communicate her acceptance of the City’s 998
offer until after the trial court orally granted summary judgment
to the City, the acceptance was not effective as there was no
longer any operative 998 offer to accept.
Plaintiff resists this conclusion with two further
arguments. First, she urges that this case is governed by
Guzman v. Visalia Community Bank (1999) 71 Cal.App.4th 1370.
She is wrong. That case held that a 998 offer is not rendered
inoperative by a trial court’s prehearing issuance of a tentative
ruling granting summary judgment. (Id. at p. 1378.) This case
addresses a different issue—namely, the effect of the trial court’s
final ruling granting summary judgment. Because a tentative
ruling is necessarily “tentative” rather than final (e.g., Silverado
Modjeska Recreation & Park Dist. v. County of Orange (2011) 197
Cal.App.4th 282, 300), it is inappropriate to equate the two.
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Plaintiff steadfastly maintains that the trial court’s ruling at the
end of the summary judgment hearing was a tentative ruling, but
that is simply incorrect. Second, plaintiff urges that the text of
section 998 expressly recognizes only two situations in which a
998 offer expires—namely, (1) after 30 days and (2) after the
commencement of trial—and that this is an exclusive list to
which a third situation (namely, after the grant of summary
judgment) cannot be added. (See Gikas v. Zolin (1993) 6 Cal.4th
841, 852 [“The expression of some things in a statute necessarily
means the exclusion of other things not expressed”].) This
argument ignores that the text of section 998 expressly requires
that an offer be extended while there is a “dispute” to be
“resolved”—a condition that no longer exists once summary
judgment is granted. Thus, the principle we recognize is part of
section 998’s text.
DISPOSITION
The judgment is affirmed. The City is entitled to its costs
on appeal.
CERTIFIED FOR PUBLICATION.
______________________, J.
HOFFSTADT
We concur:
_________________________, P. J.
LUI
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_________________________, J.
CHAVEZ
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