Wakefield v. Bohlin

MIHARA, J.,

Dissenting.—The key to this case is the statutory construction of the words “the party with a net monetary recovery” in Code of Civil Procedure section 1032’s definition of “prevailing party.” If plaintiff Ronald Wakefield was “the party with a net monetary recovery,” the trial court was required to designate him as the prevailing party, our standard of review is de novo, and the trial court erred in failing to award him his costs. If Wakefield was not “the party with a net monetary recovery,” the trial court was free to exercise its discretion to decide which party was the prevailing party, our standard of review is abuse of discretion, and we are required to defer to the trial court’s discretionary decision. Because I am convinced that Wakefield was not “the party with a net monetary recovery,” I dissent.

I. Background

In March 2001, Wakefield purchased real property from defendants Jeff and Charlotte Bohlin. In June 2002, Wakefield filed an action against the Bohlins, the Bohlins’ real estate agents and a plastering company. He asserted five causes of action against the Bohlins: negligence, strict liability, breach of implied warranty, negligent misrepresentation and fraud. Wakefield settled with the real estate agents for $45,000 and with the plastering company for $51,700 in advance of trial.

After all of his other causes of action were disposed of, Wakefield’s causes of action for intentional and negligent misrepresentation against the Bohlins were submitted to a jury. The jury returned special verdicts in favor of the Bohlins on the intentional misrepresentation cause of action and in favor of Charlotte Bohlin on the negligent misrepresentation cause of action. The jury returned a verdict in favor of Wakefield on his negligent misrepresentation cause of action against Jeff Bohlin and set the damages at $33,950.

*991 The court entered judgment in favor of Charlotte Bohlin and ordered that Wakefield “shall take nothing against Defendant Jeff Bohlin” due to Wakefield’s prior settlements with the other defendants. Wakefield did not challenge the court’s action offsetting the verdict to zero due to his settlement with the real estate agents.

The court’s judgment provided that Charlotte Bohlin was entitled to her costs and attorney’s fees, but it deferred the question of whether Jeff Bohlin or Wakefield was entitled to costs and attorney’s fees. The Bohlins and Wakefield filed memorandums of costs, motions to strike or tax each other’s costs, and motions seeking to recover their attorney’s fees from each other. The trial court determined that the Bohlins were the prevailing parties and awarded them their costs and attorney’s fees. Wakefield filed a timely notice of appeal.

II. Discussion

A. Interpretation of Code of Civil Procedure Section 1032

Wakefield claims that Code of Civil Procedure section 1032 required the trial court to designate him as the prevailing party. His claim requires us to construe the meaning of this statute.

1. Standard of Review

“The construction of a statute and its applicability to a given situation are matters of law to be determined by the court.” (Estate of Madison (1945) 26 Cal.2d 453, 456 [ 159 P.2d 630 ].) “When construing a statute, we must ‘ascertain the intent of the Legislature so as to effectuate the purpose of the law.’ [Citation.] The words of the statute are the starting point. ‘Words used in a statute . . . should be given the meaning they bear in ordinary use. [Citations.] If the language is clear and unambiguous there is no need for construction, nor is it necessary to resort to indicia of the intent of the Legislature .. ..’ [Citation.] If the language permits more than one reasonable interpretation, however, the court looks to a variety of extrinsic aids, including the ostensible objects to be achieved, the evils to be remedied, the legislative history, public policy, contemporaneous administrative construction, and the statutory scheme of which the statute is a part. [Citation.] After considering these extrinsic aids, we must select the construction that comports most closely with the apparent intent of the Legislature, with a view to promoting rather than defeating the general purpose of the statute, and avoid an interpretation that would lead to absurd consequences.” (Wilcox v. Birtwhistle (1999) 21 Cal.4th 973, 977-978 [ 90 Cal.Rptr.2d 260 , 987 P.2d 727 ].)

*992 2. Common Meaning Is Clear and Unambiguous

The current version of Code of Civil Procedure section 1032 (section 1032) provides: “ ‘Prevailing party’ includes the party with a net monetary recovery, a defendant in whose favor a dismissal is entered, a defendant where neither plaintiff nor defendant obtains any relief, and a defendant as against those plaintiffs who do not recover any relief against that defendant. When any party recovers other than monetary relief and in situations other than as specified, the ‘prevailing party’ shall be as determined by the court, and under those circumstances, the court, in its discretion, may allow costs or not and, if allowed may apportion costs between the parties on the same or adverse sides pursuant to rules adopted under Section 1034.” (§ 1032, subd. (a)(4).) “Except as otherwise expressly provided by statute, a prevailing party is entitled as a matter of right to recover costs in any action or proceeding.” (§ 1032, subd. (b).)

The question before us is whether, under section 1032, a plaintiff qualifies as “the party with a net monetary recovery” where the monetary value of a damages verdict in favor of the plaintiff against the defendant at trial is offset to zero due to settlements with other defendants and produces no net gain for the plaintiff. The common meaning of the word “net” is “free from all charges or deductions” or “to get possession of: GAIN.” (Webster’s Collegiate Dict. (10th ed. 1993) p. 780.) The word “monetary” obviously means “relating to money.” (Webster’s Collegiate Dict. (10th ed. 1993) p. 750.) The word “recover” means “to gain by legal process” or “to obtain a final legal judgment in one’s favor.” (Webster’s Collegiate Dict. (10th ed. 1993) p. 977.) Thus, the common meaning of the phrase “the party with a net monetary recovery” is the party who gains money that is “free from ... all deductions.” (Italics added.)

A plaintiff who obtains a verdict against a defendant that is offset to zero by settlements with other defendants does not gain any money free from deductions. Such a plaintiff gains nothing because the deductions reduce the verdict to zero. Hence, the common meaning of the phrase “the party with a net monetary recovery” does not include such plaintiffs among those whom the trial court is required to declare the prevailing party.

Wakefield’s theory appears to be that “the party with a net monetary recovery” was not intended to refer to a party’s recovery after all offsets but only to a party’s recovery after those offsets attributable to a verdict in favor of a particular adverse party. This distinction is between what might be called “direct offsets”—those between a particular plaintiff and a particular defendant—and “indirect offsets”—which include offsets for a plaintiff’s settlements with other defendants.

*993 While the Legislature could have reasonably chosen to draft section 1032 so that it distinguished between direct and indirect offsets, this theory runs aground on the unalterable fact that the Legislature included no language whatsoever in section 1032 which even suggests that it intended to make such a distinction. This court lacks the “power to rewrite the statute so as to make it conform to a presumed intention which is not expressed. This court is limited to interpreting the statute, and such interpretation must be based on the language used.” (Seaboard Acceptance Corp. v. Shay (1931) 214 Cal. 361, 365 [ 5 P.2d 882 ].) “In interpreting statutes, we follow the Legislature’s intent, as exhibited by the plain meaning of the actual words of the law, ‘ “ ‘whatever may be thought of the wisdom, expediency, or policy of the act.’ ” ’ ” (California Teachers Assn. v. Governing Bd. of Rialto Unified School Dist. (1997) 14 Cal.4th 627, 632 [ 59 Cal.Rptr.2d 671 , 927 P.2d 1175 ].)

The intent to distinguish between direct and indirect offsets is nowhere expressed in section 1032, and it defies the common meaning of the plain language that the Legislature actually chose to use in the statute. It is notable that the Legislature used the word “net” only in the first of the four definitions of those parties that the trial court was required to designate as the prevailing party. The third and fourth definitions used the words “any relief’ and omitted the word “net,” and the fourth definition also included language that was very specific as to the relationships between the parties. The Legislature’s choice to use the word “net” in one definition and not the others confirms that it intended a different meaning when it used that word than when it did not, and its very specific language in the fourth definition shows that it knew how to be specific when it so desired. 1

As the plain language of the statute is clear and unambiguous with regard to the meaning of the phrase “the party with a net monetary recovery,” “ ‘there is no need for construction, nor is it necessary to resort to indicia of the intent of the Legislature ....’” (Wilcox v. Birtwhistle, supra, 21 Cal.4th at p. 977 .) The analysis should end here. Yet, to forestall any argument that sources other than the plain language of the statute support an alternative construction, I will proceed to demonstrate that no support exists outside the statutory language for the distinction that Wakefield asks us to engraft onto section 1032.

*994 3. Legislative History and Context

The history of section 1032 is instructive. Former section 1032 had since 1933 provided that a plaintiff or defendant was entitled to recover costs as a matter of right “upon a judgment in his favor.” Where neither party obtained “a judgment in his favor,” the court had discretion with regard to costs. (Stats. 1933, ch. 744, § 191, p. 1901.) In 1980, Ferraro v. Southern Cal. Gas Co. (1980) 102 Cal.App.3d 33 [ 162 Cal.Rptr. 238 ] (Ferraro) held that a judgment reduced to zero by offsets for settlements with other defendants (i.e., indirect offsets) was nevertheless “a judgment in [the plaintiffs’] favor” within the meaning of former section 1032.

In Ferraro , the plaintiffs had obtained insurance proceeds and then settled with two defendants during trial for a total recovery of over $100,000. (Ferraro, supra, 102 Cal.App.3d at p. 38 .) The jury thereafter returned a damages verdict against the sole remaining defendant for less than $100,000. (Ferraro, at p. 40.) After deductions for the settlement and insurance proceeds, a judgment “of zero dollars” was entered. (Ferraro, at pp. 37, 40.) The trial court awarded the plaintiffs their costs. (Ferraro, at p. 40.) On appeal, the defendant claimed that the plaintiffs were not entitled to costs because they “did not receive a favorable net judgment.” (Ferraro, supra, 102 Cal.App.3d at p. 52 .) The Court of Appeal concluded that the judgment was still “favorable” to the plaintiffs for the purpose of costs recovery, even though the plaintiffs had not obtained a “net judgment.” (Ferraro, at p. 52.) “To consider appellants as not having received a ‘favorable judgment’ would exalt form over substance. They certainly were the prevailing party in the lawsuit and the fact that the Gas Company did not have to actually pay them any damages was due not to any deficiency in their case, but due to circumstances not directly stemming from the issues regarding liability as litigated between the parties. Disallowance of an award of costs to appellants under these circumstances could only be based upon a hypertechnical construction of the words of section 1032, Code of Civil Procedure, unsupported by case law.” (Ferraro, at pp. 52-53.) Thus, Ferraro held that the plaintiffs’ failure to obtain a “net judgment,” due to indirect offsets, did not mean that the plaintiffs had not obtained a “favorable judgment” within the meaning of former section 1032.

In February 1985, Senate Bill No. 654 (1985-1986 Reg. Sess.) (Senate Bill 654) was introduced proposing that former section 1032 be repealed and a new section 1032 be enacted. Senate Bill 654 proposed that a trial court be *995 required to identify “the party with a net monetary recovery” as the prevailing party and award that party its costs. 2 Senate Bill 654 also identified several other situations where the trial court would be required to identify a particular party as the prevailing party and in other situations granted the trial court discretion to designate either party as the prevailing party. Senate Bill 654 was sponsored by the California Judges Association to “eliminate confusion” and “simplify” the process for costs awards, thereby reducing court congestion and easing judicial workload. (Sen. Rules Com., Off. of Sen. Floor Analyses, Analysis of Sen. Bill 654, May 29, 1985; Assem. Jud. Com., Analysis of Sen. Bill 654, Apr. 4, 1986.)

In May 1985, while Senate Bill 654 was pending before the Legislature, Syverson v. Heitmann (1985) 171 Cal.App.3d 106 [ 214 Cal.Rptr. 581 ] was filed. In Syverson , the plaintiff had settled with codefendants in advance of trial for $100,000. The jury returned a verdict against the remaining defendant for $100,000. (Syverson, at p. 108.) The Court of Appeal described the result of the trial as a “zero net judgment” and noted “[t]he fact that plaintiff is not entitled to recover damages from defendant,” but it concluded, relying on Ferraro , that the plaintiff had nevertheless “received ‘a judgment in his favor’ ” and therefore was entitled to recover costs as a matter of right under former section 1032. (Syverson, at pp. 113, 114.) In July 1986, Senate Bill 654 was passed by the Legislature and signed by the Governor.

Ferraro and Syverson provide an informative context in which to consider the Legislature’s intent in repealing former section 1032 and enacting a new section 1032. In those cases, the Courts of Appeal concluded that, even though the plaintiffs had failed to obtain “net judgment^]” and were “not entitled to recover” any damages from the defendants due to indirect offsets, the plaintiffs were nevertheless entitled to recover their costs from the defendants under former section 1032 because the judgments were nevertheless “in [their] favor.” (Syverson v. Heitmann, supra, 171 Cal.App.3d at pp. 112-113; see id. at p. 114; Ferraro, supra, 102 Cal.App.3d at pp. 51, fn. 4, 52, italics added.) The Legislature’s decision in July 1986, after both Ferraro and Syverson , to repeal the “judgment in his favor” language in former section 1032 and replace it with “the party with a net monetary recovery” in the new section 1032 can easily be seen as a rejection of the results in Ferraro and Syverson. Ferraro and Syverson both dealt with indirect offsets and characterized the results of these indirect offsets as the absence of a recovery and the absence of a “net” judgment. In light of Ferraro and Syverson , the Legislature’s decision to use the phrase “net monetary recovery” without any qualification that precluded consideration of indirect offsets demonstrated that the Legislature was aware that a party whose judgment was reduced to zero by indirect offsets would not be *996 considered “the party with a net monetary recovery” and that the Legislature intended that the trial court not be required to designate such a party as a prevailing party.

Such an interpretation is also consistent with the overriding purpose of Senate Bill 654. Senate Bill 654 was intended to “eliminate confusion.” Ferraro and Syverson demonstrated that former section 1032’s “judgment in his favor” language was less than clear. Senate Bill 654’s solution to this lack of clarity was to use language which could be applied with mathematical precision. A party would be entitled to be designated the prevailing party if that party achieved “a net monetary recovery.” If the Legislature had intended to distinguish between indirect and direct offsets, it surely would have included precise language identifying that distinction in its attempt to “eliminate confusion.” Its failure to do so reflects that it intended no such distinction.

4. Subsequent Cases

None of the cases that have interpreted the 1987 version of section 1032 have held that “the party with a net monetary recovery” includes a party who obtains a net zero judgment due to indirect offsets.

In Pirkig v. Dennis (1989) 215 Cal.App.3d 1560 [ 264 Cal.Rptr. 494 ] (Pirkig), the plaintiff buyers of real property obtained a jury verdict for $51,000 against the defendant sellers, agent and brokers. The agent was found to be responsible for 21 percent of the damages. (Pirkig, at p. 1563.) The court thereafter granted defense motions to dismiss the brokers from the case and for a new trial on damages. (Pirkig, at p. 1563.) While the new trial was pending, the plaintiffs settled with the sellers for $28,300. (Pirkig, at p. 1563.) At the new trial in which the only defendant was the agent, the court found that the plaintiffs’ damages were limited to $7,500. After offsetting for the settlement with the sellers, the plaintiffs did not recover anything from the agent. (Pirkig, at p. 1563.) The trial court nevertheless found that the plaintiffs were the prevailing parties and awarded them their costs and attorney’s fees. (Pirkig, at p. 1564.)

On appeal, the agent challenged the award of costs to the plaintiffs under section 1032. He claimed that they could not be prevailing parties because they had not obtained a “net monetary recovery.” The Court of Appeal agreed that the plaintiffs had not obtained a “net monetary recovery,” but it found no abuse of discretion in the trial court’s discretionary selection of the plaintiffs as the prevailing parties under the discretionary provisions of section 1032. ( Pirkig, supra, 215 Cal.App.3d at pp. 1565-1566.)

*997 After reaching this unassailable conclusion, the Court of Appeal launched into a lengthy bit of dicta. “The only reason respondents failed to obtain a net monetary recovery at the second trial was because respondents settled before trial with the sellers for a greater amount than awarded by the second court. That such a coincidence does not affect the plaintiff’s right to recover costs and attorney fees under section 1032 is well established by the governing case law, especially Ferraro[, supra,] 102 Cal.App.3d 33 and Syverson v. Heitmann[, supra,] 171 Cal.App.3d 106 .” (Pirkig, supra, 215 Cal.App.3d at p. 1566 .) After discussing the facts and holdings in Ferraro and Syverson , the Court of Appeal returned to the crux of the matter. “[U]nder the unambiguous language of the amended statute, ‘prevailing party’ includes not only the party with net monetary recovery, but also in the discretion of the court, any party who recovers other than monetary relief and also includes all other parties who do not fall within the specified instances listed in the statute. The case at bench belongs in the latter categories.” (Pirkig, at p. 1567.) Thus, Pirkig held that, where a plaintiff’s verdict against a defendant is reduced to zero due to indirect offsets, the plaintiff is not “the party with a net monetary recovery” and therefore not necessarily the prevailing party, but the trial court may properly designate the plaintiff as the prevailing party under the discretionary provisions of section 1032.

In Zamora v. Shell Oil Co. (1997) 55 Cal.App.4th 204 [ 63 Cal.Rptr.2d 762 ] (Zamora), the jury returned a verdict for $222,282 in favor of the plaintiffs and found that 20 percent of the damages were attributable to defendant Western. However, the trial court entered a judgment of $0 due to the plaintiffs’ prior settlements with other defendants. (Zamora, at p. 207.) The trial court found that the plaintiffs were the prevailing parties as against Western and awarded them their costs. (Zamora, at pp. 213, 214.) Western claimed that the plaintiffs should not be declared the prevailing parties because they had not actually recovered anything from Western. (Zamora, at pp. 213-214.) Relying on Pirkig , the Court of Appeal found no error in the trial court’s discretionary selection of the plaintiffs as the prevailing parties. (Zamora, at pp. 214-215.)

In Great Western Bank v. Converse Consultants, Inc. (1997) 58 Cal.App.4th 609 [ 68 Cal.Rptr.2d 224 ] (Great Western Bank), the cross-defendant entered into a good faith settlement with the plaintiff and obtained dismissal of the cross-complaint. The trial court found the cross-defendant to be the prevailing party on the cross-complaint and awarded costs to cross-defendant against the defendant and cross-complainant. On appeal, the defendant and cross-complainant challenged the costs award to the cross-defendant. Since section 1032 explicitly provided that “a defendant in whose favor a dismissal is entered” is the prevailing party, the Court of Appeal concluded that the cross-defendant was entitled to be designated the prevailing party and to recover costs. (Great Western Bank, at pp. 612-613.) The Court of Appeal inexplicably included *998 the following dicta in its opinion: “Settlements by other parties and corresponding offsets do not affect a prevailing party determination. (Zamora[, supra,] 55 Cal.App.4th 204, 213-215 [ 63 Cal.Rptr.2d 762 ]; Pirkigi, supra,] 215 Cal.App.3d 1560, 1565-1568 [ 264 Cal.Rptr. 494 ]; Syverson v. Heitmann[, supra,] 171 Cal.App.3d 106, 112-114 [ 214 Cal.Rptr. 581 ].)” (Great Western Bank, at p. 613.) This statement had no impact on the result in Great Western Bank and was not supported by the cited cases.

Because Pirkig, Zamora and Great Western Bank were issued long after the Legislature’s enactment of the version of section 1032 that contains the phrase “the party with a net monetary recovery,” these cases do not tell us what the Legislature intended when it used that phrase. However, their holdings are consistent with the common meaning of the statutory language and the extrinsic evidence of the Legislature’s intent. Both Pirkig and Zamora held that a party whose recovery is reduced to zero by indirect offsets and who therefore recovers a judgment of $0 is not “the party with a net monetary recovery.” Such a party is simply eligible to be designated by the trial court as a prevailing party under the discretionary provisions of section 1032. Great Western Bank did not involve the phrase “the party with a net monetary recovery,” and its dicta tells us nothing.

5. Summary

Nothing in the plain language of section 1032 reflects that “the party with a net monetary recovery” was intended to distinguish between indirect and direct offsets such that indirect offsets that eliminated any recovery and reduced the judgment to zero would not prevent a party from being “the party with a net monetary recovery.” The history of the enactment of this language and the cases interpreting this language are completely consistent with the common meaning of the plain language of the statute. Accordingly, the trial court did not err in concluding that Wakefield was not “the party with the net monetary recovery” and refusing to find him to be the prevailing party.

B. Discretionary Determination of Prevailing Party

Since the court was not obligated by section 1032 to select Wakefield as the prevailing party, it was free to exercise its discretion to select either party as the prevailing party under the discretionary provisions of section 1032. Wakefield claims that the court abused its discretion in deciding that Jeff Bohlin was the prevailing party.

Three of Wakefield’s five causes of action against Jeff Bohlin were dismissed. Two were presented to the jury, and Jeff Bohlin prevailed on one of the two. On the sole remaining cause of action, the jury’s verdict in favor *999 of Wakefield was for far less than Wakefield’s settlement with Jeff Bohlin’s joint tortfeasors (the real estate agents). Under these circumstances, the trial court could have reasonably concluded that Jeff Bohlin had prevailed at trial by successfully avoiding any financial obligation to Wakefield. The court did not thereby abuse its discretion.

C. Attorney’s Fees

Wakefield contends that, even if the Bohlins were properly determined to be the prevailing parties, the trial court erred in awarding the Bohlins their attorney’s fees because they refused or resisted mediation.

1. Background

The purchase contract’s attorney’s fees clause provided that “the prevailing Buyer or Seller shall be awarded reasonable attorneys’ fees and court or arbitration costs . . . .” The contract provided that the parties “agree to mediate any dispute between them arising out of this transaction” and “[a] buyer or seller who refuses or resists mediation shall not be entitled to recover prevailing party attorneys’ fees.” The mediation clause also provided that “matters excluded from arbitration ... are also excluded from mediation.” The arbitration clause provided that “matters to which [Code of Civil Procedure] §§337.1 or 337.15 apply” (i.e., construction defects) were excluded from arbitration.

In October 2001, an attorney representing Wakefield sent a letter to the Bohlins’ attorney “demanding] binding arbitration” and stating “[w]e are prepared to mediate this dispute.” The Bohlins’ attorney responded with a list of “potential mediators or arbitrators . . . .” Wakefield’s attorney responded by listing his first and second choices of “mediators.” He asserted: “If we can not settle this case through mediation, then we would proceed to binding arbitration except as to the construction defects .... Those matters are an exception to arbitration, and Mr. Wakefield would proceed to a court action for those.” The Bohlins’ attorney responded: “Although not required we are willing to mediate this matter,” and he sought available dates for a mediation. He also wrote: “I am curious as to which issues you feel would come within the mediation/arbitration clause since it is my understanding that all of Mr. Wakefield’s claims relate to some kind of construction defect which are excluded from both the mediation clause and arbitration clause of the contract.”

In December 2001, Wakefield’s attorney sent a response to the Bohlins’ attorney. “I think you are correct about the mediation/arbitration clause. In reviewing the contract, I see that claims concerning construction defects are *1000 made exceptions to both mediation and binding arbitration. Those claims comprise the bulk of these issues I now see in this case. As a result, the contract gives us only a court action concerning the construction defects under various legal theories. [][] Nevertheless, I think we should attempt a mediation [in order to comply] with the court’s requirement for alternate dispute resolution in advance.”

In January 2002, the Bohlins’ attorney sent another letter to Wakefield’s attorney. “As I told you on the telephone my client is not willing to mediated [¿■zc] any claims relating to construction defects or which are excluded under the arbitration/mediation provisions of the Real Estate Purchase Contract. He is willing to submit all matters to binding arbitration. Therefore if your client is not willing to go to binding arbitration, I assume that he will have to file a complaint with the court and we will go from there.”

Wakefield filed his action in June 2002. The action was submitted to mediation in December 2003, but the mediation failed.

2. Analysis

Wakefield claims that the Bohlins should be denied attorney’s fees because they refused to mediate. The purchase contract did not obligate the parties to mediate construction defects claims. The exchange of letters between the parties’ attorneys prior to the filing of the complaint reflects that Wakefield’s attorney expressly represented to the Bohlins’ attorney that Wakefield’s claims were not subject to mediation under the contract’s mediation clause because Wakefield’s construction defect claims “comprise the bulk of these issues ... in this case.” Since the complaint had not yet been filed, the Bohlins had no choice but to accept Wakefield’s attorney’s representation. Indeed, the Bohlins’ attorney repeatedly expressed a willingness to mediate any claims to which the mediation clause applied. He only resisted mediation of claims to which the mediation clause did not apply. After Wakefield filed a complaint that included causes of action that were not for construction defects, the case was submitted to mediation.

On these facts, the trial court did not err in concluding that the Bohlins had not refused or resisted mediation and awarding them their attorney’s fees as the prevailing parties.

*1001 HI. Conclusion

I would hold that the trial court did not err in determining that the Bohlins were the prevailing parties and awarding them their costs and attorney’s fees.

Respondents’ petition for review by the Supreme Court was denied March 14, 2007, S149467. Baxter, J., was of the opinion that the petition should be granted.

The result is that where a plaintiff does not achieve a “net monetary recovery” because the judgment is reduced to zero by indirect offsets, the trial court is not required to designate the defendant as the prevailing party because, while the plaintiff has failed to obtain a “net monetary recovery,” the plaintiff has not failed to obtain “any relief.” The discretionary provisions of section 1032 are therefore applicable.

The committee reports and legislative analysis contain no specific information regarding the Legislature’s intent on the precise question before us.