998 Offer Law and Legal Definition

Section 998 of the California Code of Civil Procedure provides that, not less than 10 days before commencement of trial, any party to an action "may serve an offer in writing upon any other party to the action to allow judgment to be taken in accordance with the terms and conditions stated at that time." The offer is deemed withdrawn if not accepted before trial commences or within 30 days, whichever occurs first.

If the offer is accepted, the accepted offer is filed with the court and judgment entered accordingly. If the offer is not accepted, and the person rejecting the offer does not obtain a trial result better than the offer, a number of cost-shifting mechanisms kick in. The prospect of such cost-shifting is designed to encourage settlement of lawsuits before trial.