Category: Costs and Formal Settlement Offers

Plaintiff Receives Award Less Than Defendant’s Offer, However Defendant Is Denied Post Offer Costs

In Barta v. DaSilva, the Plaintiff was injured in a motor vehicle accident, and consequently sued for damages.

 

The Plaintiff alleged a plethora of injuries, most notably a mild traumatic brain injury, which he alleged deprived him of the ability to make sound financial decisions, leading to a substantial loss in capital and income up to and after the time of trial.

 

Prior to trial, ICBC’S lawyer made a formal offer to settle in the amount of $150,000.00, plus costs and disbursements. This was offer was rejected by counsel for the Plaintiff, who made an offer of $970,000.00, plus costs and disbursements, which was also rejected.

 

At trial, the Plaintiff was only awarded $77,750.00 in damages, as it was determined that the Plaintiff had not suffered a brain injury, and that any loss of capital and/or income were not caused by any injuries attributable to the accident. As the court award was less than the formal offer made by ICBC’S lawyer, the Court’s discretion to award legal costs against the Plaintiff was triggered.

 

Counsel for the Plaintiff argued that the Plaintiff should be awarded party and party costs throughout the entirety of the proceeding, including trial. ICBC’S lawyer argued that the Plaintiff should be entitled to costs only up the point that the Defendant’s formal offer was made, and that the Defendant should be entitled to costs after the point that the Defendant’s formal offer was made, or alternatively, that the Plaintiff be awarded costs up to the point of the Defendant’s formal offer, with each party bearing their own costs after that point in time.

 

The Court concluded that the Defendant’s offer ought reasonably to have been accepted, given the tenuous connection between the Plaintiff’s injuries, and the alleged financial losses.

 

The Court also took note of the fact that the Defendant’s formal offer was almost double that of the actual Court award, leading the Court to conclude that the Plaintiff should not be awarded costs throughout, including trial, as this would defeat the purpose of the deterrent function of the costs rule.

 

The Plaintiff was awarded costs up to the point of the Defendant’s formal offer to settle. Usually under the circumstances of the case at bar, the Plaintiff would be ordered to pay the Defendant’s post offer costs for failing to beat the Defendant’s formal offer to settle, however the Court ruled that each party would bear their own post offer costs.

 

[10]        The plaintiff submits the offer made by the defendant was not one “that ought reasonably to have been accepted”. Mr. Creighton submits that when a plaintiff experiences depression that condition may manifest itself in a variety of ways, including those that mimic a mild traumatic brain injury, and therefore the plaintiff in this case was faced with particular difficulties in assessing the reasonableness of the defendant’s offer. I do not agree. Many plaintiffs in personal injury cases have far more complex conditions than Mr. Barta but they must, nevertheless, do their best to make a realistic assessment of their claim when they receive an offer to settle.

 


[12]        The defendant’s offer of $150,000 plus costs and disbursements was a serious offer. The plaintiff ought to have known that the defendant’s legal advisers had a plausible basis for concluding that the plaintiff would be unable to prove a causal connection between his accident injuries and his financial losses. In my opinion the defendant’s offer ought reasonably to have been accepted.

 

[13]        The relative financial position of the parties is of no consequence on this application. The defence was conducted by ICBC, which obviously has much greater financial strength than the plaintiff, but unless it used that strength improperly in this litigation that is a neutral factor: See Vander Maeden v. Condon, 2014 BCSC 677.

 

[14]        When its offer to settle was not accepted the defendant had no serious option but to defend the action at trial. The result was an award of damages about one half the offer made by the defendant. In that circumstance the deterrent function of the costs rule would be nullified if I exercise my discretion by awarding costs to the plaintiff throughout as he submits I should. I declined to do so.

 

[15]        The evidence at trial indicates that the plaintiff’s assets were severely depleted by the effects of the financial downturn in 2008 and 2009. Mr. Creighton informed me that his client’s income is now meagre. I can see no utility in imposing the costs of the trial on the plaintiff.

 

[16]        My order is that the plaintiff is entitled to his costs and disbursements to and including May 15, 2014, and that thereafter the parties will each bear their own costs and disbursements. I recognize that the usual order would be to impose the costs following the defendant’s offer on the plaintiff. The defendant, however, has proposed the disposition which I have made, which I consider to be generous to the plaintiff in the circumstances.

 

Plaintiff Ordered To Pay Double Costs After Claim Dismissed At Trial

In Ross v. Andrews, the Plaintiff was injured in a motor vehicle accident, and consequently sued for damages. Prior to trial, ICBC’S lawyer had made two formal offers to settle, both of which were rejected by counsel for the Plaintiff.

 

The trial lasted for 15 days, and was by judge and jury. At the conclusion of counsel’s submissions, and the court’s instructions, the jury after deliberations determined that the Plaintiff had not been injured in the accident. The Plaintiff’s case was dismissed, with the costs issue being adjourned until a later point in time.

 

ICBC’S lawyer brought a costs application, seeking double costs from the date of service of either the first or last formal offer of the Defendant, to the date of trial, arguing that given the Plaintiff’s credibility problems prior to trial, that the offers were reasonable, and ought to have been accepted.

 

Counsel for the Plaintiff submitted that there was sufficient medical evidence upon which the Plaintiff could rely on to advance his case, and further that an award of double costs would be financial hardship to the Plaintiff.

 

The Court awarded double costs to the Defendant from a period of time of seven days after the delivery of the second formal offer to settle, to the date of trial, ruling that the offer ought reasonably to have been accepted, in light of how the credibility problems may be perceived by the jury.

 

[21]         Based on a review of the evidence at trial, described in part above, and the cases cited, as well as a review of the submissions of counsel, I find that the offer to settle in the amount of $75,000 ought reasonably to have been accepted by the plaintiff having given consideration to the foreseeable credibility problems and the negative verdict of the jury. The offers to settle both included positive returns whereas at trial the plaintiff’s action was dismissed. The relative financial circumstances of the parties do not preclude an order for double costs in this situation. As a result, applying Rule 9-1 of the Supreme Court Rules, the defendants are entitled to the costs of this action generally and double costs of this action commencing on May 26, 2016. This date is seven days after the second offer to settle was delivered to the plaintiff; a reasonable period of time for the plaintiff to consider the offer. Double costs are awarded from May 26, 2016 until the end of the trial and will include the costs of the application to fix costs. The defendants are also entitled to disbursements but not doubled.

 

[22]         The evidence aforesaid created significant areas where the credibility of the plaintiff was subject to negative findings by a jury. When those areas are added together the plaintiff ought to have actively considered any offer which offered a positive return without the risks of a trial.

 

Plaintiff Awarded Double Costs For Nearly Doubling Formal Offer to Settle

In Risling v. Riches-Glazema, the Plaintiff was injured in a motor vehicle accident when the Defendant turned left across the path of her vehicle. The Plaintiff commenced legal proceedings, seeking non-pecuniary damages, past diminished earning capacity, special damages, diminished earning capacity into the future, and the cost of future care. Liability was admitted by ICBC’S lawyer.

 

Prior to trial, counsel for the Plaintiff had made a formal offer to settle in the amount of $315,000.00, plus costs and disbursements, which was rejected by ICBC’S lawyer. The trial judge awarded the Plaintiff $622,500.00, almost double the amount of the Plaintiff’s formal offer to settle. At a costs application, counsel for the Plaintiff sought costs of the trial, plus double costs from the date of the offer to the time of trial.

 

Of the many considerations available to a Court when deciding on whether or not to award double costs, the Court focused on whether or not the Plaintiff’s formal offer to settle was one that “ought reasonably to have been accepted”, and cited the British Columbia Court of Appeal decision in Hartshorne v. Hartshorne.

 

In awarding the Plaintiff double costs from the date of the offer to the time of trial, the Court commented :

 

[7]             In my view:

 

a)              The plaintiff’s case was well known to the defendants at the time of the offer. The plaintiff had been examined for discovery on two occasions; had attended two medical examinations at the request of the defendants, and a mediation had taken place in June 2016;

 

b)              the offer was made one week before the trial began which gave the defendants a full opportunity to consider it;

 

c)               the offer had a relationship to the claim and could not be characterized as a “nuisance offer”; and

 

d)              the offer was expressed in plain language and thus easily evaluated.

 

[10]         The defendants submit their limited understanding of the case made it difficult to quantify the claim and that, while the rationale for the rule for double costs is acknowledged, the defendants ought not to have been deterred from defending the claim for fear of a “punishing costs award”. Currie v. McKinnon, 2012 BCSC 1165 is relied on in support of that argument.

 

[11]         The defendants also submit that “no rationale for the offer was provided” in the plaintiff’s letter of August 15, 2016.

 

[12]         I do not agree that no rationale was provided. The plaintiff described the heads of damages she would advance at the trial and advised that the offer took into account “Part 7 Benefits paid or payable pursuant to Section 83 of the Insurance (Vehicle) Act”. Furthermore, the defendants had an opportunity on the mediation to canvas fully with the plaintiff’s legal advisers the extent of the plaintiff’s claim and the evidence at trial which would be advanced to support the claim.

 

Plaintiff Awarded Double Costs For Besting Own Formal Offer Made Two Business Days Before Trial

In Monoharan v. Khan, the Plaintiff was injured in a motor vehicle accident, and consequently advanced an ICBC claim for injuries.

 

Two business days before the start of trial, the Plaintiff made a formal offer to settle in the amount of $425,000.00 “new money”, plus costs and disbursements, which was rejected by ICBC’S lawyer.

 

At trial, the Plaintiff sought damages for pain and suffering, income loss, loss of housekeeping capacity, diminished earning capacity, out of pocket expenses, and the cost of future care. Numerous experts were called by the Plaintiff, including a family physician, psychologist, psychiatrist, and physiatrist. At trial, substantial damages were awarded to the Plaintiff in the amount of $984,167.00, far in excess of the Plaintiff’s final formal offer to settle.

 

At a later costs application, counsel for the Plaintiff sought double costs due to the fact that the amount of the judgment exceeded the Plaintiff’s final formal offer to settle. ICBC’S lawyer argued that there was not enough time to properly review the offer, as it was only served two business days before trial.

 

The trial judge considered Rule 9-1(6) of the Rules of Court, which states :

 

Considerations of court

 

(6) In making an order under subrule (5), the court may consider the following:

 

(a) whether the offer to settle was one that ought reasonably to have been accepted, either on the date that the offer to settle was delivered or served or on any later date;

 

(b) the relationship between the terms of settlement offered and the final judgment of the court;

 

(c) the relative financial circumstances of the parties;

 

(d) any other factor the court considers appropriate.

 

The trial judge determined that ICBC’S lawyer had sufficient time within which to respond to the Plaintiff’s formal offer, and as such awarded double costs to the Plaintiff for the trial itself.

 

[1]            The trial of this personal injury action began on a Monday, January 25, 2016 and continued over the next two weeks. The parties exchanged formal offers to settle in the week before the trial began. The plaintiff delivered an offer early on January 21, 2016.  This was effectively two business days before the weekend which intervened before the trial was to begin. The plaintiff’s offer was to settle for $425,000 “new money” plus costs and disbursements.

 

[2]            As would be expected both parties at that time had been actively considering the question of how to evaluate the likely damage award and to assess whether an offer made by the other party ought reasonably to be accepted. The defendant suggests she was pressed for time to respond to the plaintiff’s offer and if double costs are to be awarded they ought not to be assessed from the beginning of the trial.

 

[3]            In my opinion, the defendant had ample time to respond to the plaintiff’s offer and to consider whether the offer was one which reasonably ought to have been accepted.

 

[4]            The final judgment awarded exceeded $900,000. I have considered the factors enumerated in Rule 9–1(6) and conclude the plaintiff is entitled to party and party costs on Scale B up to the beginning of the trial and double costs for the trial itself.

Plaintiff Awarded Full Costs Despite Not Beating Formal Settlement Offer

In Anderson v. Kozniuk, the Plaintiff was injured as a pedestrian when struck by a motor vehicle. The Plaintiff consequently advanced an ICBC claim for various injuries, including hip and clavicle fractures, as well as a mild traumatic brain injury. Liability was contested. At trial, the Plaintiff was awarded damages for his fractures, however not for the mild traumatic brain injury.

 

Prior to trial, ICBC’S lawyer made a formal settlement offer for $125,000.00, which was rejected by the Plaintiff. At trial, there was a finding of 30% contributory negligence against the Plaintiff, and the Plaintiff received an award that was substantially less than the formal settlement offer.

 

ICBC’S lawyer brought an application to determine costs, and sought an order that the Defendant pay 70% of the Plaintiff’s costs and disbursements up to the point of the final formal settlement offer, and that the Plaintiff pay 100% of the Defendant’s costs after that date. Counsel for the Plaintiff took the position that the Plaintiff was entitled to 100% of his costs, as he was the successful party. Counsel for the Plaintiff further argued that it would be unfair and unreasonable to make the Plaintiff pay the Defendant’s costs, as the Plaintiff was impecunious, the Defendant was funded by an insurer, and the award of costs to the Defendant would actually exceed the amount of the Plaintiff’s judgment. The Court agreed with this point, noting that costs awards should not punish Plaintiffs for taking meritorious claims to trial.

 

Quite often, when a Plaintiff receives a trial award that is less than the Defendant’s formal settlement offer, the Court will exercise its’ discretion to deny the Plaintiff post-offer costs, and award the Defendant post-offer costs. However, in the case at bar, the Court would not strip the Plaintiff of his post offer costs, and would not order the Plaintiff to pay the Defendant’s post offer costs.

 

[28]         The final factor in the Moses v. Kim analysis is whether the plaintiff’s substantial success would be defeated if costs were awarded. The plaintiff says it is appropriate to consider whether the costs award could substantially outweigh a relatively modest award of damages: Cairns v. Gill, 2011 BCSC 420. However, the defendant points out that, “[i]t is not the court’s function to ensure that a plaintiff makes a net recovery from an action when it has ignored a reasonable offer”:  Dempsey v. Oh, 2011 BCSC 627 at para. 19. I have already concluded it was not unreasonable for the plaintiff to reject the settlement offer, so the Dempsey case does not apply. Moreover, the amount awarded at trial in that case was less than 1/8 of the offer that was rejected: the offer was $165,000 and the trial judge only awarded $20,629.96.

 

[29]         The plaintiff submitted that the award of costs in this case exceeds the total amount of the judgment. In his written submissions, the plaintiff states that “[i]f the court orders that the Plaintiff is to pay costs to ICBC, it means that Mr. Anderson must pay the entire judgment award to ICBC, instead of spending this money on his health condition and prognosis.” I agree that is a significant factor if the court is to be mindful that costs awards should not punish plaintiffs from taking forward meritorious claims, as discussed above.

 

[33]         The award of costs is an exercise of the court’s discretion, guided by the legal principles identified above. This is not an exercise of counting up which factors favour which party and doing a mathematical calculation. The court must take into account all of the factors weighed against the circumstances of the case. Remembering that ultimately the result must not impose injustice or unfairness on either party, I exercise my discretion and conclude the normal rule of apportionment does not apply and therefore the plaintiff is entitled to 100% of his costs at trial. Because he has been successful on this application, I also award him the costs of this hearing. 

Court Denies ICBC Application For Double Costs After Plaintiff’s Claims Dismissed

In Lanz v. Silver Lady Limousine Service Ltd., the Plaintiff was injured in two motor vehicle collisions, and brought ICBC claims for both. Liability was denied in both cases by ICBC’S lawyer. The two claims were consolidated for trial purposes, with the jury dismissing the Plaintiff’s claims.

 

Prior to trial, several offers were exchanged between the parties. The initial offer from ICBC’S lawyer was for $40,000.00, plus 50% of costs and disbursements on top of the offer, while a later offer would be phrased as “new money”, inclusive of costs of disbursements, with nothing more specific than that.

 

A hearing was set down for counsel to argue the issue of costs. Counsel for the Plaintiff conceded that the Defendant was entitled to costs for being the successful party, but argued that double costs were not appropriate in the circumstances, as the offers ought not reasonably to have been accepted.

 

The Court cited the well known Court of Appeal decision in Hartshorne v. Hartshorne for the factors a Court considers in deciding on whether an offer ought reasonably to have been accepted or not. Such factors include the timing of the offer; whether the offer had some relationship to the value of the claim; whether the offer could be easily evaluated; and whether some rationale for the offer was provided.

 

The Court also quoted Justice Adair’s comments at paragraph 20 of Currie v. McKinnon that : “while the purpose of the Rule is to encourage reasonable settlements, parties should not be unduly deterred from bringing meritorious, but uncertain, claims because of the fear of a punishing costs order.”

 

In ruling that double costs would not be appropriate in the case at bar, the Court commented :

 

[22]         The defendants first offered $50,000 plus only 50% of costs; their last offer was $80,000 “new money” inclusive of costs and disbursements. In my view, there is a legitimate cause for concern when a defendant’s offer does not include costs and disbursements in a personal injury case where liability and damages are at issue. It could be seen as a tactic discouraging the plaintiff from gathering evidence to substantiate her claim in the first place. Plaintiffs carry the evidentiary burden to prove their case and they are obliged to bring forward expert medical evidence. In this case, the defendant’s offer was made more than a year after the plaintiff’s original offer, when presumably significant costs may already have been incurred with no indication from the defendants that settlement was a possibility.

 

[23]         In the context of this case, I do not find the defendants’ offers to be ones the plaintiff ought to have accepted because they did not include costs and disbursements as discrete items. I see nothing about this case that justifies penalizing the plaintiff for failing to correctly guess the jury would not accept her claims. I conclude that awarding double costs amount to imposing a heavy penalty on a plaintiff that was forced to endure the unpredictability of a jury trial. I find the day before trial, she had reasonable basis to pursue her case at trial. The defendants’ offers were devoid of discrete recognition of costs and, in my view, that was a disincentive to settle.

Court Orders ICBC To Disclose Costs Of Expert Reports As Part Of Plaintiff’s Costs Assessment

In Sturdy v. Dhadda, the Plaintiff was injured in a motor vehicle accident, and subsequently advanced an ICBC claim for damages for pain and suffering, as well as various other types of damages.

 

Prior to trial, the matter settled for approximately $300,000.00, plus taxable costs and disbursements.

 

ICBC’S lawyer disputed the reasonableness of the costs of some of the Plaintiff’s expert reports, which included a report from a neurologist, a psychiatrist, and a physiatrist. As ICBC’S lawyer would not disclose the cost of the Defendant’s expert reports, counsel for the Plaintiff brought an application for an order that ICBC’S lawyer disclose the cost of such reports, in order to compare and contrast the Plaintiff’s expert fees with those of the Defendant’s in the exact same or similar specialties.

 

The bases for the objection of ICBC’S lawyer were that the production of invoices from the Defendants’ experts would not discharge the Plaintiff’s onus to justify the reasonableness of the Plaintiff’s expert fees; secondly, the production of the invoices would offend the Defendants’ solicitor-client relationship with respect to privilege; and, thirdly, the costs of the Defendants’ expert reports would not be relevant to the issue of the Plaintiff’s costs for expert reports.

 

In granting the Plaintiffs’ application, District Registrar Nielsen commented :

 

[12]         In my view, the information sought by the plaintiff is relevant. Registrars often compare the charges of a particular expert within the same or similar speciality. The information sought by the plaintiff would involve the same or similar specialities within the same litigation concerning the same plaintiff, based upon the same clinical history.

 

[18]         What these cases demonstrate is that a comparison of the same or like expert within the same litigation is relevant. By allowing the party who challenges the reasonableness of the assessments charged by the assessing party’s experts to cherry pick what accounts they will or will not disclose leads to selective and inconsistent disclosure. If disclosure suggests the other party’s accounts are too high, they are readily disclosed for that purpose. On the other hand, if they do not, those records, for strategic reasons, are simply not produced. In my view, this leads to an imbalance which requires the levelling of the playing field.

 

[30]         In these circumstances, where the defendants have served their expert reports upon the plaintiff, the amounts paid by the defendants to their experts in the same specialities, involving the same patient, with the same clinical history, will be relevant. While a comparison of fees and charges would not be determinative and is only a single factor in the analysis, it is a matter properly considered in the context of this case, where the defendants are directly challenging the reasonableness of the plaintiff’s experts’ accounts.

Court of Appeal Allows Plaintiff’s Appeal From Order Of Trial Judge Denying Costs Of Two Interlocutory Applications

In Kondor v. Shea, the Plaintiff was injured in a motor vehicle accident when the Defendant turned left in front of her at an intersection. Consequently, the Plaintiff brought an ICBC claim for damages for pain and suffering, income loss, diminished earning capacity, and cost of future care. Liability was admitted on behalf of the Defendant by ICBC’S lawyer.

 

Throughout the course of the litigation, which eventually culminated in a nine day trial where the Plaintiff was awarded substantial damages, there were two interlocutory applications that were heard  before a Master. At trial, the judge did not award the Plaintiff costs for these two applications.

 

Counsel for the Plaintiff argued that the Plaintiff was entitled to the costs of both applications, however ICBC’S lawyer argued that the trial judge was within his jurisdiction and discretion to deprive the Plaintiff of the costs of both interlocutory applications.

 

At the first application, no provision for costs was made in favor of the Plaintiff, although it was clear that the Plaintiff would be entitled to costs. ICBC’S lawyer had made an application, however the application had been refused. The Court of Appeal ruled that there was no basis for the trial judge to state that the Plaintiff would not be entitled to the costs of such an application.

 

In regards to the second application before the Master, the order made provided that the Plaintiff would be entitled to “costs in the cause”, which are legal costs awarded at an interlocutory application that are reserved for the successful party at trial. Again, the Court of Appeal ruled that it was not open to the trial judge to deprive the Plaintiff of such costs.

 

[1]           The question on this appeal, for which leave has been granted, is whether an order made by the trial judge with respect to the costs of two interlocutory applications heard by a master in the course of the litigation of the action can be upheld.

 

[3]           Following a nine-day trial, the judge made a substantial award of damages. He concluded his reasons, 2014 BCSC 2146 (CanLII), by stating the plaintiff was “entitled to costs at Scale B” meaning of course the costs of the action apart from such costs as may have already been awarded in the course of the litigation of the action. He gave direction for written submissions in the event that any offers of settlement that may have been made were relevant to the costs awarded.

 

[11]        The judge was not hearing an appeal of the master’s orders that would have permitted him to consider whether the master had in some way erred in making one or both of his orders. Further, the master did not refer the costs of the applications to the judge as may be appropriate in some circumstances. There was then no place for the judge’s intervention.

 

[12]        It follows that I would allow the appeal and set aside the judge’s order depriving the plaintiff of her costs of the two applications heard before the master.

Plaintiff Still Entitled To Post Offer Costs, Despite Receiving Court Award Less Than Defendant’s Offer‏

In Zhao v. Yu, the Plaintiff was injured in a motor vehicle accident, and subsequently sued for damages. Prior to trial, ICBC’S lawyer made a formal offer to settle in the amount of $93,500.00. This offer was rejected, with Plaintiff’s counsel making an offer for $200,00.00, which was also rejected. At trial, the Court awarded the Plaintiff $91,700.00 in total damages, which was less than the final formal offer to settle made by ICBC’S lawyer.

 

As a result, ICBC’S lawyer argued that the Defendant should be entitled to post-offer costs and disbursements or, in the alternative, an order that the Plaintiff be entitled to costs up to the date of the offer, but that each party bear its’ own costs thereafter. Given that the matter proceeded via the fast track route, counsel for the Plaintiff sought an order for $11,000.00 in accordance with Rule 15-1(15), plus $1,500.00 for each of three additional days of trial, plus reasonable disbursements.

 

The Court reviewed the factors in Rule 9-1(6) when making its’ costs determination, focusing on 9-1(6)(a), namely whether the offer was one that ought reasonably to have been accepted. The Court noted that although in its’ view the offer was a reasonable one, that was indeed not the test. In the Court’s view, it would not be just to punish parties merely because their assessment of the value of the claim ultimately does not prove to be correct.

 

The Court would rule that the Plaintiff, despite receiving a lesser award than ICBC’S formal offer to settle, would nevertheless still be entitled to post offer costs.

 

[12] This factor was the primary focus of the parties’ submissions. The Defendant submits that the Plaintiff ought to have realized there was a risk that he would not be found to have suffered a mild traumatic brain injury and or would not be awarded compensation for impairment of the capacity to earn income in future. The Plaintiff submits that it was reasonable for the Plaintiff, based on Plaintiff’s counsel’s review of the authorities and assessment of the evidence, to believe, as he did, that he would receive an award for impairment of his capacity to earn income.

 

[13] While in hindsight the Defendant’s Offer was indeed reasonable, that is not the test. Rule 9-1(5) and 9-1(6) were not intended, in my view, to punish parties merely because the party’s assessment of the value of the claim proves incorrect, unless that assessment was based on irrelevant considerations; a clearly inadequate review of the available evidence and applicable authorities, or was, in view of the facts known at the time, unreasonable.

Plaintiff Awarded Double Costs For Besting Own Formal Settlement Offer

In Kostinuk v. Fellowes, the Plaintiff was injured in a motor vehicle collision, and subsequently commenced an ICBC claim. Three days prior to trial, the Plaintiff made a formal offer to settle for $175,000.00, which was rejected by ICBC’S lawyer. At trial, the Plaintiff was awarded approximately $192,000.00.

 

Counsel for the Plaintiff argued that the Plaintiff should be entitled to double costs from the date of the offer to the time of trial, as ICBC’S lawyer ought to have reasonably accepted the offer, as there was enough time to consider the offer.

 

ICBC’S lawyer argued that the Plaintiff should not be entitled to double costs, as the offer was presented less than 72 hours before trial, and the explanation for the offer even later than this.

 

The Court, citing the Court of Appeal decision in Hartshorne, noted the factors to be considered when determining whether or not an offer ought reasonably to have been accepted, such as the timing of the offer, whether the offer bore any relationship to the claim, and whether the offer could be easily evaluated, including if there was any rationale for the amount of the offer that was made.

 

In awarding post-offer double costs to the Plaintiff, the Court determined that there was indeed adequate time for ICBC’S lawyer to evaluate the Plaintiff’s offer, as by the time of the offer, ICBC’S lawyer had all the evidence already available, including expert opinions. Further, an explanation of the offer followed a few hours later, and the offer was within a likely range of outcomes. As such, ICBC’S lawyer was in a position to assess the reasonableness of the offer.

 

[2] The plaintiff argues that the offer ought reasonably to have been accepted, the defendant had an opportunity to consider the merits of plaintiff’s case as they had all of the plaintiff’s medical evidence, wage loss and special damages particulars at the time the offer was made. The defendant also had her own medical expert evidence. Her expert evidence included that from Dr. Werry who opined quote “Mr. Kostinuk’s time away from work following October 7, 2010 MVA was reasonable”.

 

[7] The defendant argues that courts should not award double costs based on the factors set out in Rule 9-1(6). The offer was not one that ought reasonably to have been accepted because it was delivered less than 72 hours before the start of trial and the explanation of the offer was only delivered subsequent to service. The defendant says moreover that it had meritorious defences to the plaintiff’s claims for past and future wage loss. The defendant says that the justification/breakdown for the offer was not provided a reasonable time prior to trial and could not easily be evaluated.

 

[10] …… Here, although the offer was delivered on the Friday before the commencement of trial, there was an adequate period of time within which to evaluate the offer. As the plaintiff submits, by that point in time all of the evidence was available to the party. They had exchanged earlier offers. Discoveries were complete, expert opinions available. The defence would have been well able to assess the offer in the time available to it. Moreover, the plaintiff had provided an explanation that followed the offer within a few hours. The offer was within the range of likely outcomes. In the circumstances, the defendant would be able to assess the reasonableness of the offer and make a decision on it.