Overly Broad Release Agreement Costs California Driver in Pedestrian Accident Case

magnifying glassIn a personal injury case, you have a lot of important decisions to make. One of those is whether to accept or reject a settlement offer. This is one of many areas where experienced counsel can help immensely. Whether it is wise or unwise to accept a settlement may depend greatly on whether that settlement constitutes a “998 offer” under the California statutes. In another recent case exploring the criteria for valid 998 offers, the California Court of Appeal upheld a ruling against a driver because the release she included as part of the offer she extended was too broad to qualify as a 998 offer.

The case arose from a 2013 accident in which Marilynne Caracciolo’s vehicle struck a pedestrian, Yolanda Ignacio. Ignacio sued for her injuries. Caracciolo offered to settle the case for $75,000 but also demanded that Ignacio sign a release document as part of the settlement. Ignacio turned the offer down. Ultimately, she took her case to trial and received a damages award of $70,000.

After the result, Caracciolo made a motion arguing that, based upon Section 998 of the Code of Civil Procedure, Ignacio should not be allowed to recover all of her legal costs, and Caracciolo was entitled to recover a part of hers. Under Section 998, if a defendant makes you a settlement offer that complies with the statutory requirements, and you reject the offer, only to go to trial and receive an award less than the settlement offer amount (or lose entirely), the responsibility for paying for the costs of the litigation changes. When that happens, the statute says that the defendant can recover her costs that she incurred after she made the offer, and she can escape the obligation for paying your costs after that date as well.

However, despite the fact that the damages award was $5,000 less than the settlement amount, the trial court denied Caracciolo’s request. She appealed, but, at the appeals court, Caracciolo was again unsuccessful. The outcome of this case came down to the way in which she made her settlement offer. This and other recent appeals court cases relating to Section 998 offers have highlighted one common and very important point. The law imposes some very clear requirements regarding how you must go about making an offer for it to constitute a valid 998 offer. Failure to meet all of these requirements will make a settlement offer invalid under Section 998 and means that the cost-shifting provisions in the statute don’t apply.

In Caracciolo’s case, her release was too broad. The law says that if you receive a release as part of a settlement that requires you to forever abandon parties or claims that are not part of the immediate case at hand, that is not a valid 998 offer. The release Caracciolo presented to Ignacio said that Ignacio must release “any and all claims… whether now known or unknown, suspected or unsuspected, that have existed or may have existed or which do exist, or which hereinafter can, shall or may exist.” This, the appeals court concluded, was much too broad to be valid under Section 998, since it asked Ignacio potentially to give up claims that would have been well outside the scope of this case.

Your injury attorney can help you with many decisions, including weighing the benefits and drawbacks of rejecting a settlement. This also includes aiding you in identifying whether the offer you’ve received is a qualifying 998 offer or not. The skilled Oakland car accident attorneys at the Law Offices of Stephen M. Fuerch have many years of experience guiding injured people throughout each step of the legal process, and they’re ready to help you with your case too. Contact us through our website or call our office at (925) 463-1073 to schedule your confidential initial consultation today.

More Blog Posts:

Failure to Word Statutory Settlement Offer Properly Costs Defendants in California Motorcycle Accident Case, Oakland Personal Injury Attorney Blog, May 16, 2016

Introducing Settlement Agreements in California Auto Accident Cases, Oakland Personal Injury Attorney Blog, Sept. 30, 2015