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What is a 998 offer to compromise?

Example: Plaintiff X has made a demand for $100,000.00. Defendant Y is almost certain that it will prevail at trial on the issue of liability. As a result, Defendant Y files an offer of compromise for $10,000, the approximate amount Defendant Y reasonably believes it will cost to try the case.

How to respond to 998 offer?

Rather, 998 offers promote settlements by giving the offeror an advantage at trial should the offeree fail to beat the offer. In effect, Section 998 rewards one party for making an offer and punishes the other party for failing to accept the offer.

What is an example of offer to compromise?

Accepting or rejecting a 998 offer The party to whom the 998 offer was made must accept the offer in writing within 30 days after it is made, or before the trial or arbitration, whichever is earlier.

Does a 998 cut off attorneys fees?

In most cases, fees will be included as part of the 998 and the parties can negotiate attorneys fees.

How does a 998 offer work?

Your 998 offer is effectively a cost-shifting option that places a greater financial burden on the party that does not accept a reasonable pre-trial settlement made in good faith. It allows you to suggest a deal with strings attached, where there is a disincentive to allow the case to proceed to arbitration or trial.

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