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Trusts and Estates

Meleski v. Estate of Hotlen

Cite as C080023
Filed November 29, 2018, Third District

By Daniel C. Kim
Weintraub Tobin Chediak Coleman Grodin Law Corporation
www.weintraub.com

Headnote: CCP 998 Offers – Insurer as Party Under Probate Code § 550 – Liability of Insurers for Costs

Summary: A decedent’s insurer can be liable for costs beyond policy limits where the insurer obtains an outcome at trial that is less favorable than the Plaintiff’s C.C.P. 998 offer.

Amanda Meleski was injured when Albert Hotlen ran a red light and collided with her vehicle. At the time of the accident, Hotlen had a $100,000 policy limit through Allstate Insurance. Hotlen then died and, as authorized by the Probate Code, Meleski filed a probate action against Holten’s estate for the policy limits of $100,000, serving her complaint on Allstate. Allstate rejected Meleski’s C.C.P. 998 offer to compromise of $99,999. At trial, Meleski recovered $180,613.86, and sought costs, including expert fees, of $66,017.08 under C.C.P. 998. The Court denied Meleski’s requests for costs, holding that Plaintiff’s recovery was limited to the $100,000 policy limit. Plaintiff appealed.

The appellate court reversed. Allstate, although technically not a named party, was nevertheless a party for purposes of C.C.P. 998. The notion that the “estate” is the defendant is a legal fiction. In the context of this claim against the decedent’s insurer, Allstate alone controlled the litigation, was exposed to any liability, and rejected Plaintiff’s C.C.P. 998 offer. Allstate had made its own C.C.P. 998 offer, and the legislature did not intend for asymmetrical application of the statute. Lastly, the appellate court held that the insurer is liable for such costs even in excess of the policy limits.

http://www.courts.ca.gov/opinions/documents/B282202.PDF

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