Ditsch v. Peppertree Café

Filed 7/28/06 Ditsch v. Peppertree Café CA2/3

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION THREE

APPEAL from a judgment of the Superior Court of Los Angeles County, Jane L. Johnson, Judge. Affirmed.

Law Office of David A. Mallen and David A. Mallen; Law Offices of David W. Affeld and David W. Affeld for Plaintiff and Appellant.

Law Offices of Mark R. Haddon and Mark R. Haddon for Defendants and Respondents.

________________

INTRODUCTION

At the close of trial of her sexual harassment and statutory-wage violation lawsuit against defendants Peppertree Café and David and John Dallas, plaintiff April Marie Ditsch moved for attorney fees and costs. The trial court denied plaintiff's motion because her total recovery was less than the trial court's jurisdictional amount (Code Civ. Proc., § 1033, subd. (a))[1] and was less than defendants' statutory offer to compromise (§ 998). Under the authority of section 998, the trial court awarded $5,238 in costs to defendants. Plaintiff appeals contending that the trial court abused its discretion in denying her fees and ordering her to pay defendants' fees. We affirm.

FACTUAL AND PROCEDURAL BACKGROUND

Plaintiff, a hostess and later waitress at the Peppertree Café, brought the instant action in May 2003 against defendants alleging eight causes of action arising from her constructive discharge from employment. In relevant part, plaintiff alleged violation of the Fair Employment and Housing Act (the FEHA) (Gov. Code, § 12940) based on sexual harassment (1st cause of action), constructive termination in violation of public policy (2nd cause of action), and negligent supervision (8th cause of action).[2] Plaintiff alleged she was subjected to a continuous pattern of sexual harassment, perpetrated by her supervisor and other employees of the café who made sexually suggestive gestures and derogatory comments, sabotaged her ability to do her job, and sexually accosted her.

On December 9, 2003, seven months after the lawsuit commenced, defendants served a statutory offer to compromise (§ 998) on plaintiff offering to compromise plaintiff's claims for FEHA violation, constructive discharge, and negligent supervision in full for $15,000. The offer expired on January 13, 2004.

After taking plaintiff's deposition on December 30, 2003, and while the statutory offer was still extant, defendants orally offered to settle those claims for $10,000. Plaintiff rejected the offer that same day and offered to settle for $26,000. Defendants rejected plaintiff's offer and withdrew their $10,000 oral offer on January 10, 2004.[3]

On February 3, 2004, plaintiff offered to compromise her claims against one individual for $22,217.80. There is no indication what defendants did with that offer, but we assume they rejected it as the case went to trial.

The only causes of action tried to a jury were the first, second, and eighth, for violation of FEHA and the related sexual harassment claims. At the close of trial, the jury returned a verdict in favor of plaintiff against all three defendants as follows: (a) for sexual harassment, non-economic damages of $2,000; (b) for constructive discharge, economic damages of $5,600; and (c) for negligent supervision, economic damages of $1,000. The jury did not award punitive damages.

Thereafter, plaintiff moved for attorney fees in the amount of $152,420.45 and costs of $17,823 under the authority of Government Code section 12965, subdivision (b).

In a five-page statement of decision, the trial court denied plaintiff's motion. The trial court ruled that defendants' statutory offer to compromise for $15,000 was the only offer against which to compare the judgment, notwithstanding defendants' oral offer was communicated while the statutory written offer was operative. The court ruled that plaintiff was not the prevailing party because her recovery was less than the trial court's jurisdictional amount (§ 1033, subd. (a)), with the result that plaintiff was not entitled to costs. (Steele v. Jensen Instrument Co. (1997) 59 Cal.App.4th 326, 331 (Steele), rev. den. March 11, 1998.) After applying the rules under section 998, the court denied plaintiff's request for costs and attorney fees and ordered plaintiff to pay defendants' costs of $5,238, reasoning that plaintiff had rejected defendants' $15,000 statutory offer, which offer was for more than plaintiff's $8,600 recovery. (§ 998.) Plaintiff's timely appeal followed.

CONTENTIONS

Plaintiff challenges the trial court's fee award but not the jury verdict.

DISCUSSION

1. Defendants' oral negotiations did not operate to revoke their written, statutory offer to compromise under section 998.

Plaintiff first contends that defendants impliedly revoked their section 998 offer of $15,000 made in December 2003, because they orally offered $10,000, within 30 days of the statutory offer. Plaintiff is incorrect for three reasons.

First, revocation of an offer in the context of section 998 must be more than merely inferred. â€