Oakes v. Progressive Transportation Services, Inc.
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Guzman, driving a truck for his employer (Progressive), rear-ended the plaintiff’s vehicle. The plaintiff was driving a truck for his employer. Following the accident, the plaintiff returned to work for three weeks, but then left his employment. During the following months, the plaintiff continued to receive treatment. His former employer’s workers’ compensation insurance carrier, Liberty, paid for the treatment.
Plaintiff sued The defendants served a $200,000 offer to settle (Code of Civil Procedure 998). Plaintiff rejected the offer. The parties stipulated that a $256,631.76 workers’ compensation lien existed and that the defendants would admit negligence, but not causation as to the plaintiff’s injuries. The jury returned a verdict of $115,000.
Opposing the plaintiff’s fee petition, the defendants argued that the plaintiff should not recover fees and post-offer costs because the verdict did not exceed the section 998 offer. Defendants’ costs totaled $174,830.29. The court awarded the plaintiff $50,600 in attorney fees and the $475.98 pre-offer filing fee in costs. Although Labor Code section 3856 requires costs to be paid from the judgment, the court added the fees and costs to the verdict, then concluded the defense had a net gain over the plaintiff and was the prevailing party and entered an $8,754.22 final judgment in favor of the defendants.
The court of appeal affirmed. The court erred by adding attorney fees to the verdict when calculating the net judgment. A $59,354.31 defense judgment should have been entered there was no “judgment for damages recovered” from which the plaintiff’s reasonable litigation expenses and attorney fees or Progressive’s workers’ compensation lien could be paid. (Lab. Code 3856(b)). The defendants had not challenged their $8,754.22 judgment.
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