Opinion
H035774
09-29-2011
JOYCE GILLIAM, Plaintiff and Respondent, v. PING HUA FONG et al., Defendants and Appellants.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
(Santa Clara County Super.Ct.No. CV164339)
This action resulted from a car accident in which plaintiff and respondent Joyce Gilliam sustained personal injuries for which she received medical care partly paid for by Medicare. She sued defendants and appellants Ping Hua Fong and Pao Lin Fong, and in the course of the litigation made a statutory offer to compromise under Code of Civil Procedure section 998. She offered to dismiss this action in exchange for payment of $25,000 to her and her attorney from the Fongs, whose liability insurer was providing a defense in the action. The Fongs served and filed an "acceptance" of Gilliam's offer, which affirmatively stated that they accepted the offer but then added conditional terms to that acceptance. These were that Gilliam would be "responsible for all outstanding liens" and that "all statutory lienholders [would] be named as payees on the settlement draft unless such lienholders provide written authorization to be excluded as payees." According to the Fongs, they intended to satisfy Medicare's right to reimbursement from them under federal law by this conditional language and to provide for direct reimbursement to Medicare out of settlement funds or a waiver by Medicare of that right, an issue not addressed in Gilliam's offer.
Further statutory references are to the Code of Civil Procedure unless otherwise indicated.
Upon the Fongs' filing of Gilliam's offer together with their conditional "acceptance," the clerk ministerially entered judgment in the amount of $25,000 based on the Fongs' "acceptance of offer to compromise," as noted on the judgment. (Initial caps. omitted.) But the form judgment was mistakenly entered for the Fongs and against Gilliam. The Fongs immediately brought this clerical mistake in parties to the clerk's attention, as a result of which the clerk entered a second judgment for and against the proper parties. At the same time, the Fongs also directed the clerk to strike the provision on the form judgment for the accrual of interest, and the clerk complied.
After entry of judgment, the Fongs, through their counsel, tendered a $25,000 check payable to Gilliam, her attorney, and Medicare. Gilliam's counsel returned the check, contending that the addition of Medicare as a payee did not comply with the payment terms of her section 998 offer, which had specified payment only to Gilliam and her attorney. He also threatened to begin enforcement proceedings on the judgment. The Fongs brought a motion to stay enforcement on the judgment and to deem it satisfied under section 724.050. The court denied the motion.
The Fongs appeal from the judgment and the denial of their motion to deem the judgment satisfied. We dismiss the appeal from the judgment, as it is nonappealable. For the reasons that follow, we also affirm the postjudgment order.
STATEMENT OF THE CASE
I. Factual Background
As alleged in her complaint, Gilliam was involved in an auto accident on July 24, 2009, with Ping Hua Fong, who was driving a car owned by Pao Lin Fong. For her personal injuries sustained in the accident, Gilliam received medical care for which Medicare paid some amount.
Before filing suit, Gilliam engaged in settlement discussions with the Fongs' liability insurer that implicated the policy limits of $25,000. But the carrier insisted that Medicare, which had the right to seek reimbursement of its costs from the Fongs, among others, either be included as a payee on the $25,000 settlement check or that amounts subject to the right of reimbursement be made payable to Medicare by separate check, reducing the amount of money that Gilliam would directly receive in settlement. Gilliam refused to settle on this term, and her attorney instead countered that he would assume personal liability "for any Medicare lien, which would include, agreeing to hold harmless, to defend and to indemnify" the Fongs and their counsel for any claims made against them by Medicare arising from the incident. The parties did not settle on this basis, the issue of directly satisfying any obligation to Medicare as part of the settlement being the obstacle.
II. Procedural Background
Unable to reach a settlement, Gilliam filed suit against the Fongs on February 23, 2010. She sought damages for their alleged negligence but also claimed her entitlement to punitive damages because Ping Hua Fong had allegedly been using her cell phone while driving when the accident happened, an allegedly malicious act.
The Fongs moved to strike Gilliam's prayer for punitive damages but before the motion was heard, Gilliam served an offer to compromise under section 998 on or about April 14, 2010. The terms of the offer were that the Fongs would pay $25,000, the policy limits, to Gilliam and her attorney, with the parties bearing their own respective costs and attorney fees, in exchange for Gilliam dismissing the action with prejudice.
Section 998 is a cost-shifting mechanism. It provides that any party to an action may "serve an offer in writing upon any other party to the action to allow judgment to be taken or an award to be entered in accordance with the terms and conditions stated at that time . . . ." (§ 998, subd. (b).) "If the offer is accepted, the offer with proof of acceptance shall be filed and the clerk or the judge shall enter judgment accordingly." (§ 998, subd. (b)(1).) But "[i]f an offer made by a plaintiff is not accepted and the defendant fails to obtain a more favorable judgment or award . . . , the court or arbitrator, in its discretion, may require the defendant to pay a reasonable sum to cover postoffer costs of the services of expert witnesses . . . actually incurred and reasonably necessary in either, or both, preparation for trial or arbitration, or during trial or arbitration, of the case by the plaintiff, in addition to plaintiff's costs." (§ 998, subd. (d).) An offer is deemed withdrawn if it is not accepted before trial, or within 30 days after it is made. The statute does not dictate the manner in which acceptance is to be communicated. Nor does it provide a deadline for the filing of proof of acceptance together with the offer, which ordinarily results in the ministerial entry of judgment.
Twenty-nine days later, which was one day before the offer expired by statute, the Fongs, through their attorney, served and filed what they termed an "acceptance" of Gilliam's section 998 offer. But they expressly conditioned that acceptance on Gilliam "being responsible for all outstanding liens" and "all statutory lienholders be named as payees on the settlement draft unless such lienholders provide written authorization to be excluded as payees," terms not included in Gilliam's section 998 offer. They did not specifically use the term "Medicare" or directly refer to its statutory right of reimbursement, as distinguished from general third-party statutory lien rights. At the same time they filed their "acceptance," the Fongs also filed Gilliam's offer, which, consistently with section 998, provided that proof of acceptance thereof would authorize the clerk to enter judgment in accordance with the offer.
In a ministerial act, the clerk then entered judgment that same day, May 13, 2010, in the amount of $25,000 based on the Fongs' "acceptance of offer to compromise," as noted on the judgment, notwithstanding the conditional nature of the acceptance. The judgment did not include any specific terms of Gilliam's section 998 offer, such as to whom the funds tendered in satisfaction should be made payable. Nor did it include the additional conditions reflected in the Fongs' "acceptance" of the offer. And the form judgment entered was mistakenly in favor of the Fongs and against Gilliam instead of the reverse.
We observe that Gilliam's actual offer was to receive $25,000 from the Fongs in exchange for a dismissal of the action, not for judgment to be entered for or against any party. Section 998 expressly provides for entry of judgment, not dismissal of the action. But courts have held that in order to effectuate the policy of encouraging settlement that underlies the statute, as long as the section 998 offer provides for a final disposition of the action, which would include a dismissal, the terms of the statute are satisfied in this respect even though the offer does not provide for entry of judgment as a condition of settlement or track this specific statutory language. (Berg v. Darden (2004) 120 Cal.App.4th 721, 729-731 (Berg); American Airlines, Inc. v. Sheppard, Mullin, Richter, & Hampton (2002) 96 Cal.App.4th 1017, 1055-1056; Goodstein v. Bank of San Pedro (1994) 27 Cal.App.4th 899, 905-906.)
The following day, May 14, 2010, the Fongs recognized this clerical error in parties and immediately brought it to the clerk's attention, which resulted in the clerk correcting the mistake by entering a new judgment, as of the preceding day, in favor of Gilliam and against the Fongs in the amount of $25,000. At the Fongs' direction, the clerk also interlineated a printed line in the form judgment that provided for the accrual of interest at 10 percent from the date the judgment was entered. Gilliam's attorney then served notice of entry of judgment on May 17, 2010.
This amounted to a second judgment as the first was never formally vacated by order of the court, an issue the parties do not raise. We will treat the second judgment as the one, final judgment as it is clear that the first judgment contained a clerical error that would have justified its vacation. (Zamora v. Clayborn Contracting Group, Inc. (2002) 28 Cal.4th 249, 259 (Zamora) [relief under section 473 warranted where in section 998 judgment, the word "against" was erroneously substituted for the phrase "in favor of"].)
Thus, the Fongs effectuated the entry of a money judgment against them by filing Gilliam's offer along with their "acceptance" thereof, coupled with their subsequent efforts to cause a second, replacement judgment to be entered that was for and against the proper parties and that eliminated the accrual of interest but that did not contain their conditional terms of acceptance, or any other terms. The Fongs' counsel then delivered a check to Gilliam's counsel in the amount of $25,000 that same day, May 14, 2010. The check was made payable to Gilliam, her counsel, and Medicare, inconsistently with the terms of Gilliam's offer, which had specified payment just to her and her counsel, and the face of the judgment.
Gilliam's counsel took the position that the check was "not acceptable to satisfy the [j]udgment" because it included Medicare as a payee, and he consequently returned it on May 17, 2010. His transmittal letter to the Fongs' counsel also stated that "satisfaction of the [j]udgment may be made only by making payment by check made payable to Joyce Gilliam and her attorney . . . in the sum of the [j]udgment amount of $25,000.00 plus interest at the daily rate of $6.85." He further advised that he would begin proceedings to execute on the judgment.
Upon receipt of Gilliam's counsel's letter and return of the check, the Fongs' counsel provided notice that he would appear in court ex parte to seek an order "(1) shortening time to hear a motion to stay enforcement of judgment and deeming judgment fully satisfied and (2) staying enforcement of judgment until said motion can be heard." The ex parte application took the position that there was a settlement agreement because the Fongs had accepted Gilliam's section 998 offer, and that the agreement included reimbursement of Medicare by virtue of the terms of their conditional acceptance. In other words, they did not contend the opposite; that their conditional "acceptance" had actually amounted to a counteroffer and that no compromise had actually been reached to support the judgment as entered. They also contended that Medicare had a "statutory lien" and that "federal law requires that Medicare be put on the settlement check." (Capitals omitted.) The court issued an order shortening time and stayed enforcement of the judgment pending the hearing on the motion.
The Fongs filed their "motion to stay judgment and deem judgment as fully satisfied" under sections 918 and 724.050. (Capitalization omitted.) The motion again asserted that the Fongs had accepted Gilliam's section 998 offer, forming a contract, and that the resulting agreement included the condition of acceptance that Medicare either be directly reimbursed as part of the settlement or waive the right to reimbursement. They reiterated their positions that Medicare had a statutory lien, that federal law required the inclusion of Medicare on the settlement check, that their tender of the settlement check that had included Medicare as a payee satisfied the judgment in full, and that they were therefore entitled to acknowledgment of satisfaction of judgment.
Gilliam opposed the motion. She maintained that the terms of her section 998 offer did not include any provision for naming Medicare as a payee on the settlement check, and that this was therefore beyond the scope of any agreement reached. But she contended that it was "undisputed" that the Fongs had accepted her section 998 offer, forming a contract on the terms contained therein. She noted that their causing their "acceptance" to be filed with the court manifested their intent that judgment be entered against them "under the terms and conditions set forth in the 998 offer," which did not include any provision for payment to Medicare. She further observed that although the Fongs were not claiming that their "acceptance" had actually amounted to a counteroffer with no resulting agreement, one could consider this to be so but for the Fongs' having filed their "acceptance" in addition to serving it and allowing judgment to be entered. Gilliam also refuted that federal law required Medicare to be named on the settlement check, while acknowledging its right to reimbursement from the Fongs as well as from her and her attorney. She further noted that Medicare had not yet specified amounts to be reimbursed and that including it as a payee on the check would cause months of delay in her ability to cash it. She finally contended that interest should accrue on the judgment as a matter of law, despite the Fongs' having caused the clerk to strike this provision by interlineating it in the form judgment. She offered a proposed amended judgment that provided for the accrual of interest.
The Fongs' reply observed that under contract principles, as a result of their conditional "acceptance" of Gilliam's offer to compromise, there was either an agreement that included the term that Medicare be named as a payee on the settlement check or their "acceptance" was actually a counteroffer that resulted in no contract ever having been formed. This was the first time they acknowledged the possibility that a contract had not been formed, albeit doing so in the alternative. But they did not seek to vacate the judgment on this basis under section 473, or any other authority, or to modify it in accordance with their version of the agreement.
On June 15, 2010, the court denied the Fongs' motion from the bench, consistently with its prior tentative ruling. When asked for its rationale, the court expressed its view that the Fongs had "accepted the judgment by accepting the 998" and they had "allow[ed] a judgment to be entered without any other limitation." As a result, the court concluded that Gilliam's counsel would be responsible for "dealing with the liens." But the court was "not convinced" in any event that Medicare was a statutory lien claimant, as referenced in the Fongs' counter offer, notwithstanding its statutory right to reimbursement. The court also determined that, notwithstanding the judgment's interlineated and thus omitted provision for the accrual of interest, Gilliam was entitled to interest on the judgment as a matter of law. The court, however, declined to sign the amended judgment so providing. The court's subsequent written order denied the Fongs' motion to stay enforcement of the judgment and to deem it fully satisfied and ordered that interest at 10 percent accrue on the judgment from the date of its entry on May 13, 2010.
The Fongs timely filed their notice of appeal "from the [j]udgment" and the post-judgment order denying their motion to stay enforcement of the judgment and to deem it fully satisfied.
DISCUSSION
I. The Section 998 Judgment is Not Appealable
As noted, the Fongs purport to appeal from both the judgment and the order denying their post-judgment motion under section 724.050, which provides a procedure for a judgment debtor who has satisfied a judgment to obtain acknowledgment of satisfaction of judgment from a recalcitrant judgment creditor after demand therefor.
Consistently with an appeal from a judgment, all the arguments in the Fongs' opening brief go to its validity or propriety, by contending or proceeding from the premises that a compromise agreement was reached based on the Fongs' acceptance of Gilliam's section 998 offer; that the agreement properly includes a provision for satisfaction of Medicare "liens" because, as contended, federal law requires this; and that the court erred by entering a judgment that did not reflect all the terms of the parties' section 998 agreement. The substance of the briefing therefore attempts to pierce the judgment and attack its very validity, through arguments that it does not accurately reflect the purported terms of the agreement on which it rests. The Fongs specifically challenge the entry of judgment as error and seek its reversal because it did not include their express conditions of acceptance, namely that Gilliam is to be "responsible for all outstanding liens" and that "all statutory lienholders be named as payees on the settlement draft unless such lienholders provide written authorization to be excluded as payees." And they contend that the court "refused to modify the judgment to reflect the express condition" of their acceptance, presumably in the context of the post-judgment motion, even though they never challenged or sought modification or vacation of the judgment below on any ground.
But, as contended by Gilliam, a judgment ministerially entered on a section 998 offer and acceptance, as this one was, is not appealable. In Pazderka v. Caballeros Dimas Alang, Inc. (1998) 62 Cal.App.4th 658, 667 (Pazderka), the court held that a section 998 judgment was not appealable because the entry of judgment by the clerk or judge is a ministerial act following the filing of the offer and proof of acceptance. "At no time during the entire process leading to entry of a section 998 judgment does a judge or jury ever consider the validity of the agreement." (Id. at p. 667.) The court further held that the "appropriate procedure to challenge a section 998 judgment is to request the trial court to vacate the judgment pursuant to section 473," and that that ruling would constitute an appealable order (while confining available relief under section 473 to circumstances that do not include professional mistakes by counsel). (Pazderka, supra, at pp. 668-669; see also Zamora, supra, 28 Cal.4th at pp. 254-258 [discretionary relief under section 473, subdivision (b) available to set aside 998 judgment where it resulted from clerical mistake anyone could have made and not legal malpractice].)
The court in Bias v. Wright (2002) 103 Cal.App.4th 811 (Bias), also addressed the appealability of a section 998 judgment. There, unlike in Pazderka or here, the trial court had adjudicated disputed facts about whether defendant's acceptance of a section 998 offer was absolute and unequivocal before the judgment was entered. The parties had informed the court that a dispute had arisen over whether an agreement under section 998 existed before any judgment. The defendant moved to enforce the parties' alleged agreement and both parties submitted declarations and other evidence. The court held a hearing and determined that an agreement existed, granting the defendant's motion. This was followed by entry of a judgment that incorporated the order granting the motion. The court of appeal distinguished Pazderka on the question of appealability in that in Bias, the entry of judgment was not ministerial and had instead followed the court's adjudication that there was an agreement, making the judgment appealable. (Id. at pp. 816-817.) But the court of appeal also held that the trial court erred because it should not have adjudicated the dispute over whether the section 998 offer was valid, the statute providing no authority for such a determination. (Bias, at p. 822 ["a trial court cannot adjudicate disputed facts concerning the parties' intent in reaching a section 998 compromise and enter judgment"].) If it is unclear whether the parties have reached agreement as a result of a section 998 offer and purported acceptance, no adjudication should occur and the court should simply decline to enter judgment. (Bias, at p. 822.)
The procedural posture of the instant case is more like Pazderka than Bias with respect to entry of judgment and its appealability. This is because the clerk here entered the judgment in a ministerial act and there was no adjudication preceding that event. The judgment is accordingly not appealable. The Fongs appear to proceed on appeal as if the trial court, as in Bias, somehow adjudicated the validity of the judgment as they contend in briefing that the judgment "was ultimately ordered entered by Judge Pierce;" that they filed a "motion to correct the judgment;" and that "the trial judge refused to modify the judgment," none of which occurred, as is clear from the record.
And they cite Bias for the proposition that a "section 998 judgment, followed by a motion that contests the content of the judgment is deemed to be an appealable event." (Italics added.) But Bias does not so hold. As noted, in Bias, unlike here, the court adjudicated the validity and enforceability of the agreement resulting from the section 998 offer and acceptance before ordering entry of judgment, rendering that event adjudicatory rather than ministerial and thus appealable. It is Pazderka in which the section 998 judgment was followed by a motion for relief under section 473. And there, the court of appeal determined that the judgment was not appealable, as do we. The Pazderka court also specifically concluded that the proper procedure to challenge a section 998 judgment is a motion to vacate it under section 473, not just any motion "that contests the content" of the judgment, and that the resulting section 473 ruling would constitute an appealable order.
Also resulting in the judgment's non-appealability here is the Fongs' consent to its entry. A judgment entered by consent or stipulation based on the agreement of the parties to fully settle their dispute is not appealable. (Norgart v. Upjohn Co. (1999) 21 Cal.4th 383, 400, 403; In re Marriage of Broderick (1989) 209 Cal.App.3d 489, 501 [appellant waives right to attack error by expressly or impliedly agreeing or acquiescing to the ruling or procedure objected to on appeal]; In re Estate of Gurnsey (1923) 61 Cal.App. 178, 182 ["A party is not aggrieved by a consent judgment, or one which he has requested the court to decree"].) Here, the Fongs caused a section 998 judgment to be entered in the first place by filing their conditional "acceptance" of Gilliam's statutory offer to compromise, along with her offer, which was not required by the statute within the 30-day acceptance period in order to form a contract. Then, they caused the second section 998 judgment to be entered in order to correct the clerk's mistake as to whom the judgment was for and against, but also to eliminate the provision for the accrual of interest. This was affirmative conduct demonstrating a tactical maneuver on the Fongs' part. In this circumstance, they can be deemed to have invited the error they now claim by virtue of the judgment's entry—that it does not incorporate the conditional terms of their "acceptance." One whose conduct induces or invites the commission of error by the trial court is estopped from asserting it as a ground for reversal on appeal. (Gurnsey, at p. 403.) Moreover, the Fongs have never sought, under section 473, to vacate the judgment below on the basis that no agreement had been reached, their conditional "acceptance" amounting to a counteroffer rather than an unequivocal acceptance as required by section 998. Indeed, even on appeal, they have mostly taken the affirmative position that a contract was formed, albeit on terms that included those contained in their conditional acceptance. Because of their own conduct relating to the entry of judgment, and their failure to challenge or seek to modify the judgment below, the Fongs are in no position to seek the relief they request on appeal from the judgment.
As reflected in our disposition, we will accordingly partially dismiss the appeal to the extent it is from the non-appealable section 998 judgment.
II. The Fongs Have Shown no Error in the Denial of Their Motion to Deem the Judgment Satisfied
The Fongs brought their postjudgment motion under section 724.050, which, as noted, provides a procedure for a judgment debtor to obtain an acknowledgment of satisfaction of judgment after making an unsuccessful demand from the judgment creditor. A post-judgment order relating to the enforcement of a judgment is an appealable order. (§ 904.1, subd. (a)(2); Olson v. Cory (1983) 35 Cal.3d 390, 400.) The issue thus presented for review is whether the Fongs demonstrated their right, under section 724.050, to acknowledgment of satisfaction of judgment by having satisfied it. Resolution of the issue requires us to apply the statute to undisputed facts. We therefore conduct our review de novo. (Ghirardo v. Antonioli (1994) 8 Cal.4th 791, 799; Hurtado v. Statewide Home Loan Co. (1985) 167 Cal.App.3d 1019, 1023-1024, overruled on another ground in Shamblin v. Brattain (1988) 44 Cal.4th 474, 479, fn. 4; International Engine Parts, Inc. v. Feddersen & Co. (1995) 9 Cal.4th 606, 611.)
While applying section 724.050 might invoke analysis of the judgment's facial contents to ascertain whether it has been satisfied, the inquiry on the motion is not the validity or propriety of the judgment. Indeed, the statute provides no authority for the court to vacate or modify the judgment, instead providing that "[i]f the court determines that the judgment has been satisfied and that the judgment creditor has not complied with the demand, the court shall either (1) order the judgment creditor to comply with the demand or (2) order the clerk to enter satisfaction of the judgment." (§ 724.050, subd. (d).)
The Fongs have not challenged the court's having in effect amended the judgment in its order by directing the accrual of interest thereon, recognizing Gilliam's right to interest on the section 998 judgment, like any other, as a matter of law.
We have previously held that the trial court has the authority in the context of a section 724.050 motion to recognize and implement an equitable set-off against a judgment resulting from a multi-party good faith settlement under section 877. (Wade v. Schrader (2008) 168 Cal.App.4th 1039, 1047-1048 [undisputed good faith settlement amounts received from several parties may be credited as an equitable set-off against a judgment against another party in the context of a motion to compel satisfaction of judgment under section 724.050].) But we did so recognizing in that case that the entitlement to the offset was as a matter of law and that its amount was undisputed (id. at pp. 1043, 1046-1047), and that the offset did not affect a change in the judgment or award, only the application of settlement credits received and the resulting balancing of mutual debts and credits (id. at pp. 1047-1048). We specifically held that the section 724.050 procedure is an acceptable context "for balancing offsetting judgments." (Id. at p. 1048.) This is entirely distinct from what the Fongs suggest here—that the section 724.050 procedure is an appropriate vehicle for challenging a judgment by attacking its validity and vacating or modifying it as a result, and that the trial court erred by not doing so.
The court below was presented with a judgment that on its face decreed that Gilliam was entitled to be paid $25,000 by the Fongs. It is only by satisfying this facially valid obligation that the Fongs would be entitled to relief under section 724.050, namely an order compelling the production by Gilliam of an acknowledgment of satisfaction of judgment or a decree by the clerk of the equivalent. The undisputed evidence presented was that the $25,000 money judgment was in favor of Gilliam and against the Fongs, with no mention of Medicare, and that in addition to Gilliam and her attorney, the Fongs included Medicare as a payee on the check tendered in satisfaction, precluding Gilliam's ability to cash it without obtaining Medicare's endorsement and consent. The fact of the additional payee made the tender conditional, whereas the judgment is not. The Fongs accordingly failed to demonstrate either that they had satisfied the judgment or that Gilliam was obligated to provide an acknowledgment of satisfaction of judgment, which warranted a denial of the motion.
Although the trial court had no power to vacate or modify the judgment in the context of the section 724.050 motion, it appears from the record that it did, to some extent, nevertheless consider its validity, which obviously rested on a section 998 offer to compromise.
Section 998 is intended to "encourage settlement by providing a strong financial disincentive to a party—whether it be a plaintiff or a defendant—who fails to achieve a better result than that party could have achieved by accepting his or her opponent's settlement offer." (Bank of San Pedro v. Superior Court (1992) 3 Cal.4th 797, 804; Poster v. Southern Cal. Rapid Transit Dist. (1990) 52 Cal.3d 266, 270 (Poster).) To promote this policy, statutory offers to compromise must be clear and specific so as to enable the offeree to meaningfully "evaluate it and make a reasoned decision whether to accept it, or reject it and bear the risk he may have to shoulder his opponent's costs and expenses. [Citation.]" (Berg, supra, 120 Cal.App.4th at p. 727.) "To that end, a section 998 offer is construed strictly in favor of the party sought to be subjected to its operation. [Citations.]" (Id. at p. 727.) Clarity and specificity are also required in a section 998 offer "because the trial court lacks authority to adjudicate the terms of a purported settlement." (Ibid; Bias, supra, 103 Cal.App.4th at p. 819.) As previously noted, "[n]either the clerk nor the court is authorized to adjudicate a dispute over the terms of a section 998 agreements before entering judgment. [Citations.]" (Berg, supra, 120 Cal.App.4th at p. 727; Bias, supra, at p. 819.)
For the same reasons, an acceptance of a statutory offer to compromise must be "absolute and unqualified" and may not set forth qualifications or conditions not contained in the section 998 offer. (Bias, supra, 103 Cal.App.4th at p. 820 ["acceptance" of section 998 offer that interposes a conditional term as to which offer is silent is a counteroffer, not an unqualified and absolute acceptance]; Civ. Code, § 1585.) A conditional acceptance does not constitute proof of acceptance under section 998 so as to authorize entry of judgment. (Bias, supra, 103 Cal.App.4th at p. 820.) But as with a section 998 offer, neither the court nor the clerk may resolve any ambiguities in the acceptance of section 998 offer before ministerially entering judgment. (Bias, at pp. 819, 821; Saba v. Crater (1998) 62 Cal.App.4th 150, 153.)
However, where the question whether a contract has been formed under section 998 has been properly posed, in the context of a post-judgment motion under section 473 for example, the normal rules of contract law apply to section 998 offers and acceptances, unless such rules conflict with the policies encouraging settlement embodied in section 998. (T. M. Cobb Co. v. Superior Court (1984) 36 Cal.3d 273, 280; Poster, supra, 52 Cal.3d at p. 271.)
The court's order here simply denied the section 724.050 motion, as the judgment itself provided no condition as to how Medicare was to be satisfied or by whom. But when asked for its reasoning, the court said that the Fongs had "accepted the judgment by accepting the 998" and they had "allow[ed] a judgment to be entered without any other limitation," thereby acquiescing in it. As a result, the court concluded that Gilliam's counsel would be responsible for "dealing with the liens." But the court further offered that it was "not convinced" in any event that Medicare was a statutory lien claimant, as referenced in the Fongs' counter offer, notwithstanding its statutory right to reimbursement. It is not clear what analysis the court engaged in or what standards it applied to reach these conclusions, whether under section 998 as to the terms of the parties' contract or some other equitable principles applicable to the Fongs' acquiescence, by their conduct, in the entry of the judgment.
The Fongs do not cite authority that actually provides for a statutory "lien" for Medicare's benefit, apart from its right to merely be reimbursed from a variety of parties.
But the Fongs have briefed this appeal as if they had sought to vacate or modify the judgment below by presenting the trial court with a post-judgment request for relief under section 473. They appear to argue on appeal that the trial court erred in denying their phantom request and that we should either modify the judgment to include the terms of their conditional acceptance of Gilliam's section 998 offer, or vacate the judgment as resting on a contract that was never formed.
Yet we are not faced here with reviewing a ruling by the trial court denying a motion to vacate or modify the judgment, neither of which the Fongs ever properly asserted below. And they steadfastly maintained below that a contract indisputedly exists to support the judgment, on the terms of their conditional acceptance, and that they were therefore entitled to have the existing judgment deemed satisfied. Although, as noted, the trial court remarked that by "accepting the 998" and "allowing a judgment to be entered without any other limitation," the Fongs had acquiesced in the judgment, the court had not been asked to modify or vacate the judgment under section 473 in the context of the motion to compel the issuance of a satisfaction of judgment under section 724.050. Its statutory authority to vacate or modify the judgment was therefore never invoked. And the court's written order made no findings or determinations as to whether a section 998 agreement had been reached or the scope of such an agreement. Accordingly, arguments relating to whether the parties ever legally reached a section 998 agreement, or the contents of that agreement, so as to have warranted the judgment's vacation or modification below are beyond the scope of our review, as much as the Fongs would like us to reach these issues by reversing the judgment with directions to enter a new one on the terms contained in their conditional acceptance of Gilliam's section 998 offer, or so modifying the judgment ourselves.
DISPOSITION
The appeal from the nonappealable section 998 judgment is dismissed. The post-judgment order denying relief under section 724.050 is affirmed.
Duffy, J.
WE CONCUR:
Rushing, P.J.
Judge of the Monterey County Superior Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.
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