California Legal Brief

The Rule of Maynard Matthews et al. v. Patrick Ryan is that a section 998 settlement offer conditioned on consent by the defendant's insurance carrier is valid, under circumstances where the defendant is defended by an insurer whose consent is necessarily required for any settlement regardless of whether such consent is expressly stated in the offer.

Appeal from judgment after jury trial and postjudgment orders in Superior Court, Los Angeles County.

Defendant Appellant was Patrick Ryan — the allegedly negligent driver in an automobile collision.

Plaintiff Respondents were Maynard and Tanis Matthews — the injured driver and his wife claiming loss of consortium.

The suit sounded in negligence and loss of consortium arising from an automobile collision.

The key substantive facts leading to the suit were defendant collided his vehicle into Mr. Matthews' vehicle, severely injuring Mr. Matthews.

The procedural result leading to the Appeal: The trial court denied plaintiffs' postjudgment motions for prejudgment interest under Code of Civil Procedure section 998 and Civil Code section 3291, ruling that plaintiffs' settlement offer was invalid because it was conditioned on defendant's insurer's consent; and denied plaintiffs' motion for costs of proof under Code of Civil Procedure section 2033.420. The court also denied defendant's new trial motion challenging jury selection procedures.

The key question(s) on Appeal: 1. Whether defendant forfeited his challenge to the trial court's use of volunteer jurors for voir dire by failing to object below 2. Whether plaintiffs' section 998 settlement offer was invalid because it was conditioned on defendant's insurer's consent 3. Whether the trial court erred in denying plaintiffs' motion for costs of proof under section 2033.420

The Appellate Court held that defendant forfeited his jury selection challenge by failing to object, and that plaintiffs' section 998 offer was valid despite the insurer consent condition because such consent is implicitly required for any settlement with an insured defendant whether expressly stated or not, making the express condition merely redundant rather than invalid.

The case is inapplicable when the settlement offer contains nonmonetary conditions that are difficult to value or compare to a judgment, when offers are conditioned on acceptance by multiple parties to the litigation, or when a party timely objects to jury selection procedures during trial.

The case leaves open the question of whether plaintiffs' settlement offer was reasonable and in good faith under the circumstances existing at the time the offer was made, which the court remanded for determination by the trial court.