§ 9.4.5 EFFECT OF OFFER OF JUDGMENT

• Jurisdiction: Arizona

§ 9.4.5 Effect of Offer of Judgment

An offer of judgment served pursuant to Ariz. R. Civ. P. 68 must include the costs accrued to the date of the offer. If the final judgment is not more favorable to the offeree than was the offer, the offeree must pay the reasonable expert witness fees and double the taxable costs of the offeror, as defined in A.R.S. § 12-322, that the offeror incurred subsequent to the offer. An offeror who states that the specified amount includes an unspecified amount for costs, does so at its peril. See Hales v. Humana of Ariz., Inc., 186 Ariz. 375, 378, 923 P.2d 841, 844 (App. 1996). In Hales, the defendant made an offer of judgment in the amount of $50,000 "to include all taxable costs." Because the plaintiff's net damage award was less favorable than the defendant's offer of $50,000, the defendant claimed it was entitled to an award of its expert witness fees and double its post-offer taxable costs. Id. at 377, 923 P.2d at 843. The court of appeals disagreed, reasoning that the true amount of the offer was $50,000 minus the...