Madrigal

Opinion of the Court by Corrigan, J.

The general cost recovery rule in California entitles the prevailing party in a civil action or proceeding to recover its litigation costs as a matter of right. Code of Civil Procedure section 1032 sets out the rule and defines who qualifies as a “prevailing party.”1 (§ 1032, subds. (a)(4), (b).) Section 1033.5 identifies the items allowable as costs, which include attorney fees when authorized by statute. (§ 1033.5, subd. (a)(10)(B).) Section 998 modifies section 1032’s general rule. To encourage the settlement of cases before trial, section 998 shifts the liability for costs under some circumstances. As relevant here, when a plaintiff rejects or fails to timely accept a qualifying defense offer (998 offer), and then “fails to obtain a more favorable judgment or award,” the plaintiff is not entitled to its postoffer litigation costs and must pay some or all of the defendant’s postoffer costs. (§ 998, subd. (c)(1).) The specific question here is a narrow one. Does a plaintiff who has rejected a 998 offer or allowed it to be deemed withdrawn for want of timely acceptance, but later agrees to settle before trial, necessarily avoid the postoffer…