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Ernster v. Scheele

Court of Appeals of Minnesota

April 17, 2017

Steven Ernster, Appellant,
v.
Teddi M. Scheele, et al., Respondents.

         Ramsey County District Court File No. 62-CV-14-4741

          Isaac I. Tyroler, Charles D. Slane, TSR Injury Law, Bloomington, Minnesota (for appellant)

          Peter M. Waldeck, Jason M. Stoffel, Waldeck Law Firm P.A., Minneapolis, Minnesota (for respondents)

          Considered and decided by Peterson, Presiding Judge; Johnson, Judge; and Bjorkman, Judge.

         SYLLABUS

         I. When there has been an offer of judgment under Minn. R. Civ. P. 68.01, a plaintiff-offeree who obtains a verdict and judgment against the defendant-offeror is allowed reasonable disbursements as the prevailing party under Minn. Stat. § 549.04 (2016) even if the judgment is less favorable to the plaintiff-offeree than the offer of judgment and less favorable to the plaintiff-offeree than the limit on relief that the defendant-offeror sought at trial.

          II. When an offer of judgment under Minn. R. Civ. P. 68.01 is not accepted and a defendant-offeror makes another offer of judgment, the earlier offer of judgment is repealed, and the later offer takes the place of the earlier offer.

          OPINION

          PETERSON, Judge

         In this appeal from a judgment that awarded respondents disbursements following a jury trial on the issue of damages, appellant argues that the district court erred by (1) denying appellant disbursements as the prevailing party under Minn. Stat. § 549.04; and (2) awarding respondents disbursements incurred after service of the first of two offers of judgment under Minn. R. Civ. P. 68.01, instead of disbursements incurred after service of the second offer. We reverse and remand.

         FACTS

         Appellant Steven Ernster brought this negligence action against respondents Teddi M. Scheele and Terrance M. Scheele, seeking damages for injuries sustained in a motor-vehicle accident. On July 31, 2015, respondents served upon appellant under Minn. R. Civ. P. 68.01 a total-obligation offer of judgment in the amount of $50, 000. On August 17, 2015, respondents served upon appellant under Minn. R. Civ. P. 68.01 a second total-obligation offer of judgment in the amount of $100, 000. Appellant did not accept either offer.

         Before trial, respondents admitted to liability and to appellant's past health-care expenses of $23, 859.03. The issues of damages for past and future pain, disability, and emotional distress were tried to a jury. At trial, appellant asked the jury to award him $500, 000, and respondents argued that appellant's recovery should be limited to $25, 000.

         The jury awarded appellant $15, 000 for past pain, disability, and emotional distress and $5, 000 for future pain, disability, and emotional distress, which, together with the $23, 859.03 for admitted past health-care expenses, resulted in a total verdict of $43, 859.03 for appellant.[1] After reducing the verdict amount by the amount of collateral-source benefits that appellant received, a judgment of $23, 959.03 was entered in favor of appellant.

         Both parties applied for costs and disbursements. Respondents argued that because the verdict for appellant was less than either of their offers of judgment and because the $20, 000 that the jury awarded for past and future pain, disability, and emotional distress was less than the amount proposed by either party at trial, they were the prevailing parties and, therefore, they were entitled to recover all of their costs and disbursements. Alternatively, respondents argued that they were entitled to recover costs and disbursements that they incurred after their first offer of judgment was served on July 31, 2015.

         The district court determined that because appellant obtained a judgment in his favor of more than $100, appellant was entitled to recover from respondents costs of $200.[2] But the court further determined that because appellant was not the prevailing party, he was not entitled to recover his disbursements. The district court then determined that because the jury's verdict was less favorable to appellant than either of respondents' offers of judgment, respondents were the prevailing parties ...


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