CCP 998 was amended in 1997 to allow arbitrators to award costs under CCP 998 when a party fails to achieve an arbitration award more favorable to that party than a 998 offer made to the party before the award. This decision holds that the arbitrator may make such a cost award despite CCP 1284.2 which provides generally that each party shall bear a pro rata share of arbitration fees and expenses. Furthermore, it holds that the proper procedure is for the party that made the 998 offer to seek an award of costs from the arbitrator within 30 days after the arbitrator renders his award on the other issues in the case, not having mentioned the issue before because CCP 998(b)(2) provides that the rejected 998 offer cannot be given in evidence in the trial or arbitration. The arbitrator can then treat what he thought was a final award as an interim award and rule on the motion for an award of costs under CCP 998. If, as here, the arbitrator refuses to hear the cost issue (thinking he lacked jurisdiction after rendering an award), the trial court may award the costs on a petition to correct or vacate the arbitration award.
California Court of Appeal, Sixth District (Walsh, J., sitting by assignment); May 31, 2017; 2017 WL 2351269