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Saakyan v. Modern Auto10/31/2002
btains a more favorable judgment, the court must award interest at 10 percent per annum on that judgment, from the date of the plaintiff's first section 998 offer until the judgment is satisfied. The right to prejudgment interest under Civil Code section 3291 is dependent on whether the plaintiff receives a more favorable judgment under section 998. (Gilman v. Beverly California Corp. (1991) 231 Cal.App.3d 121, 126.)
Plaintiffs contend the trial court erroneously ruled that the jury verdict in the first trial extinguished any right plaintiffs may have acquired under section 998 based on their statutory offers to compromise made in 1994, which offers were not accepted. They request that we remand the case to the trial court with instructions to reevaluate the validity and reasonableness of the offers, and if they are valid, calculate reasonable witness fees (§ 998, subd. (d)), and add prejudgment interest (Civ. Code, § 3291) from February 1994.
Where the issue is the application of law to undisputed facts, we review the trial court's order de novo. (Barella v. Exchange Bank (2000) 84 Cal.App.4th 793, 797.) We hold the trial court erred here in ruling plaintiffs' benefits pursuant to their statutory offers to compromise made in 1994 were "extinguished due to the verdict for the defendant in the first trial."
Nothing in the wording of these statutes indicates a judgment operates to terminate rights under section 998, where that judgment is later vacated and a new trial is held. (Cf. Steinfeld v. Foote-Goldman Proctologic Medical Group, Inc. (1996) 50 Cal.App.4th 1542, 1550 [language of Civil Code section 3291 does not indicate interest tolls during intervening, unsuccessful appeal].) The right to witness fees and prejudgment interest is triggered by a more favorable judgment. Section 998 applies when plaintiff's offer "is not accepted and the defendant fails to obtain a more favorable judgment." Likewise, Civil Code section 3291 makes a "simple comparison" between the judgment and the statutory offer to compromise. (Lakin v. Watkins Associated Industries (1993) 6 Cal.4th 644, 662-663, fn. 13.)
Under California law, when the trial court grants a new trial as to all of the causes of action, the judgment is vacated. (Beavers v. Allstate Ins. Co. (1990) 225 Cal.App.3d 310, 329.) The effect of an order granting a new trial is " `as though no trial had ever been had . . . . The case before the court for trial de novo.' [Citation.]" (Guzman v. Superior Court (1993) 19 Cal.App.4th 705, 707, original italics.) The grant of a new trial "[leaves] the case at large and the parties placed in the same position as if it had never been tried . . . .' " (Sichterman v. R.M. Hollingshead Co. (1931) 117 Cal.App. 504, 506; see also Fountain Valley Chateau Blanc Homeowner's Assn. v. Department of Veterans Affairs (1998) 67 Cal.App.4th 743, 751.) Hence, any verdict or judgment entered in advance of a new trial order was merely ephemeral, because superceded by the judgment entered after new trial.
Here, the effect of trial court's grant of a new trial was to nullify the first judgment entered in 1995, with the result neither the judgment entered after the first trial, nor the special verdict upon which it was based, exists to extinguish any benefits that may have arisen under section 998. The order granting plaintiffs a new trial, which order we affirmed in the first appeal, vacated the 1995 judgment and placed the parties in the same position as if the case had never been tried (Sichterman v. R.M. Hollingshead Co., supra, 117 Cal.App. at p. 506), with any rights under plaintiffs' statutory offers extant.
It matters not to the result that the intervening 1995 ju
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