Opinion
NOT TO BE PUBLISHED
APPEAL from orders of the Superior Court of San Diego County, Luis R. Vargas, Judge. Super. Ct. No. GIC816073
NARES, J.
A jury returned a defense verdict in favor of defendant Gerald Rudick and against plaintiffs John C. Fraser and Kara Fraser (together the Frasers). Rudick requested $55,679.96 for expert witness costs under Code of Civil Procedure section 998. The court instead awarded $21,595.06, awarding nothing for the costs incurred for experts who did not testify at trial. Rudick then brought a motion for reconsideration, which the court denied.
All further statutory references are to the Code of Civil Procedure.
Rudick appeals the post judgment orders, contending the court (1) erred as a matter of law when it categorically denied the recovery of expert witness fees and costs for any experts who did not testify at trial, and (2) further compounded that error by refusing Rudick a meaningful opportunity to respond to its denial of expert fees and costs and by declining to reconsider that erroneous ruling. We reverse the court's order denying Rudick's motion to recover expert witness costs for the services of the expert witnesses he claims assisted him in the preparation of his defense at trial, but who did not testify at trial, and further remand the matter with directions.
FACTUAL AND PROCEDURAL BACKGROUND
In December 2000 Rudick purchased a home in La Jolla, California, as a short-term investment property. Eight months later, after making cosmetic repairs to the home, Rudick sold it to the Fraser's. After occupying the property for two years, the Fraser's filed a lawsuit against Rudick (and others) seeking damages for breach of contract, intentional and negligent misrepresentation, negligence, concealment, negligence, and certain statutory violations. Prior to trial, Rudick served the Fraser's with an offer to compromise under section 998 in the amount of $85,001. The Fraser's rejected the offer.
Rudick retained numerous experts, including McCormick Consulting Group (McCormick) as his cost-of-repair expert. McCormick charged Rudick $13,230 for its services.
The case proceeded to trial, and six of Bendick's experts, including McCormick, did not testify at trial. The jury found in favor of Rudick, who brought a motion to recover expert costs under section 998 in the amount of $55,679.96, including $34,084.90 for the six experts who did not testify at trial. The Fraser's opposed the motion, arguing Rudick failed to provide evidence that the amount requested was reasonable. Rudick filed a reply declaration, stating that a McCormick employee did not testify at trial because the court granted Bendick's motion in liming regarding the applicable standard of damages. Rudick attached invoices showing a McCormick employee, R. Scott Morgan, prepared a cost-of-repair estimate and spent a substantial amount of time preparing for deposition testimony.
Although Rudick retained several experts who did not testify at trial, there is insufficient documentation of the services rendered by the other experts. However, Rudick's appendix does include the invoices for services rendered by McCormick. Therefore, we confine our analysis to whether costs should have been awarded for the services rendered by McCormick.
During oral argument, the court indicated it would not award the amount Rudick requested. The court granted, in part, Bendick's motion for expert costs and ordered the Fraser's to pay $21,595.06. The order stated:
"While it is in the Court's discretion to order plaintiff to pay reasonable expert witness fees incurred by defendant in preparing for trial, the court in Avers v. Cornelius (1984) 163 Cal.App.3d 310, 318 [Avers] stated that 'it is unreasonable to conclude that the Legislature intended to include the cost of services of all "experts" who might assist counsel in preparation for trial.' In Avers, the court disallowed recovery of costs associated with an expert who 'could not be considered even a "potential" expert witness.' Id. [¶] Defendant seeks a total of $55,679.96 in expert witness fees, $34,084.90 attributable to six experts who did not testify at trial. While defendant was certainly required to build a proper defense in anticipation of multiple theories, the court in Avers strongly implies that only potential witnesses may be reimbursed. Defendant does state in his declaration that the cost [of] repair witness was indeed a potential witness, however a motion in liming precluded his use. However, based on the motion, it is unclear exactly who the cost [of] repair expert is and the amount attributable to him. The Court hereby grants expert witness fees in the amount of $21,595.06 to Defendant."
Rudick brought a motion for reconsideration under section 1008, asking the court to vacate the prior order and award fees for services rendered by McCormick. The court denied the motion because it concluded Rudick failed to provide new facts, circumstances, or law as required by the statute. The court found that "[e]even if [Rudick] had met his burden under [section] 1008, the court would not award expert fees for the services of McCormick. In the previous motion, the court declined to award attorney's fees for experts who did not testify at trial, including McCormick. Therefore, the submission of additional invoices does not change the court's analysis in that regard."
DISCUSSION
Rudick argues that the court (1) erred as a matter of law when it categorically denied the recovery of expert witness fees and costs for any of his defense experts who did not testify at trial; and (2) further compounded that error by refusing Rudick a meaningful opportunity to respond to its denial of expert fees and costs, and by declining to reconsider that erroneous ruling. We conclude that the court's order on Bendick's motion to recover expert witness costs under section 998 must be reversed as a matter of law, and the matter remanded for further proceedings.
Rudick argues that we should review ed nova the court's expert witness fees award, and reverse it as a matter of law because the court misconstrued Avers, supra, 163 Cal.App.3d 310; erroneously misapplied section 998 by "categorically precluding the award of fees and costs incurred by any expert who did not actually testify at trial," and failed to exercise its statutory discretion under that section to determine whether the services of Rudick's experts reasonably assisted him in the preparation of his defense. We agree.
Section 998 provides that a trial court "has the discretion whether to make an award of expert witness fees . . . ." (Estimates v. Old World Owners Assn (2005) 127 Cal.App.4th 948, 953.) Specifically, subdivision (c)(1) of that section (hereafter section 998(c)(1)) provides (with an exception not relevant here) that when a plaintiff "in any action" rejects a defendant's section 998 offer to compromise and fails to obtain a more favorable judgment, the trial court "in its discretion, may require the plaintiff to pay a reasonable sum to cover costs of the services of expert witnesses, who are not regular employees of any party, actually incurred and reasonably necessary in either, or both, preparation for trial or arbitration, or during trial or arbitration, of the case by the defendant." (Italics added.)
Ordinarily, we review the reasonableness of a section 998 award for an abuse of discretion. (Antonio v. Westinghouse Broadcasting Co. (1994) 25 Cal.App.4th 102, 121.) However, ed novo review is required where the matters before the appellate court involve the resolution of pure questions of law, rather than the resolution of disputed facts. (Pangaea and Victory Partners v. Histogram (2002) 103 Cal.App.4th 775, 779-780.) In this case, we review the award de novo as Rudick's appeal raises issues of pure law by asserting the court misinterpreted and misapplied section 998 and applicable case law.
In his motion, Rudick requested $55,679.96 under section 998, but the court awarded $21,595.06, compensating him only for the experts who testified at trial. In its order, the court explained that although it had discretion to order the Frasers to pay reasonable expert fees incurred by Rudick in preparing for trial, the court in Avers, supra, 163 Cal.App.3d 310, "strongly implie[d] that only potential witnesses may be reimbursed." Noting that Rudick was seeking a total of $55,679.96 in expert witness fees, $34,084.90 of which was "attributable to six experts who did not testify at trial," and acknowledging that Rudick's cost-of-repair expert was a potential witness, the court declined to award the $34,084.90, stating that a motion in liming precluded the use of the cost-of-repair expert's testimony.
Rudick does not challenge the court's in liming ruling, which is not at issue in this appeal.
The court also stated that, "based on the motion, it is unclear exactly who the cost [of] repair expert is and the amount attributable to him."
Later, in its order denying Rudick's motion for reconsideration, the court stated that even if Rudick had met his burden in bringing that motion, "the court would not award expert fees for the services of McCormick. In the previous motion, the court declined to award attorneys' fees for experts who did not testify at trial, including McCormick." (Italics added.)
The foregoing record demonstrates that the court misinterpreted Avers, supra, 163 Cal.App.3d 310, and the scope of the court's statutory discretion under section 998(c)(1). In Evers, the defendant contended on appeal that the trial court improperly allowed the fees of an orthopedic surgeon under section 998 because the surgeon did not testify at trial. (Avers, supra, 163 Cal.App.3d at p. 317.) The Court of Appeal rejected that contention, stating that "so long as the expert is a potential witness," reasonable costs were recoverable "so long as the expert at least aided in the preparation of the case for trial." (Ibid.) Post-Avers cases also hold that recovery of expert witness fees under section 998 is not limited to the actual time consumed in examination in court. (Antonio v. Westinghouse Broadcasting Co., supra, 25 Cal.App.4th at pp. 123-124; Michelson v. Camp (1999) 72 Cal.App.4th 955, 975-976.)
As already discussed, section 998(c)(1) plainly provides in part that when a plaintiff rejects a defendant's section 998 offer to compromise and fails to obtain a more favorable judgment, the trial court in its discretion may require the plaintiff to "pay a reasonable sum to cover costs of the services of expert witnesses, who are not regular employees of any party, actually incurred and reasonably necessary in . . . preparation for trial . . . ." (Italics added.)
Where a court fails to exercise its discretion to award reasonable expert fees under section 998, and misapplies its provisions, the matter must be reversed and remanded to the trial court as a matter of law. (See Estimates v. Old World Owners Ass'n, supra, 127 Cal.App.4th at p. 953.)
Here, as a result of its misinterpretation of Evers, supra, 163 Cal.App.3d 310, and the scope of its discretion under section 998(c)(1), the court erred by failing to exercise discretion with respect to, and categorically denying, Rudick's request under that subdivision for an award of a reasonable sum to cover the costs of the services of the expert witnesses who he claims assisted him in the preparation of his defense at trial, but who did not testify at trial. Accordingly, we reverse the court's order denying that request and remand the matter with directions that the court exercise its discretion in determining under section 998(c)(1) whether the services of the expert witnesses in question were "actually incurred and reasonably necessary in . . . preparation of trial" within the meaning of that subdivision; and the reasonable sum, if any, that the Fraser's should be ordered to pay for those services.
In light of our foregoing conclusions, we need not address Rudick's remaining contention that the court compounded its error by refusing Rudick a meaningful opportunity to respond to its denial of expert fees and costs, and by declining to reconsider that erroneous ruling.
DISPOSITION
The court's order denying Rudick's motion to recover expert witness costs for the services of the expert witnesses he claims assisted him in the preparation of his defense at trial, but who did not testify at trial, is reversed. The matter is remanded with directions that the court exercise its discretion in determining under section 998(c)(1) whether the services of the expert witnesses in question were "actually incurred and reasonably necessary in . . . preparation of trial" within the meaning of that subdivision; and the reasonable sum, if any, that the Fraser's should be ordered to pay for those services.
WE CONCUR: Benke, Acting P. Judge., HUFFMAN, J.