ICBC Law

Today I’m blogging from the sunny City of Vernon, having completed an examination for discovery a little earlier than expected with some time on my hands prior to returning to Victoria.

In the first precedent that I am aware of concening Rule 37B (The new BC Supreme Court Rule dealing with formal settlement offers) reasons for judgement were released today refusing to award a successful defendant double costs after trial.

While this is not and ICBC claim, nor even a personal injury claim for that matter, the factors that the court considered in refusing to order double costs may be relevant in an ICBC claim.

The facts of the case briefly are as follows: The Defendant was sued by the SPCA for the costs of care the SPCA incurred for some neglected animals. The Defendant denied liability and made a formal offer to settle the claim for $1. The Defendant succeeded at trial. In such a scenario, under the old Rule 37, the Defendant would likely be entitled to ‘double costs’. Here, the Defendant asked the court to excercises its discretion under the new Rule 37B to award double costs.

The court refused to do so setting out the following reasons:

The Law

[12] Rule 37B(1) reads in part:

(1) in this rule “offer to settle” means

an offer to settle made and delivered before July 2, 2008 under Rule 37, as that rule read on the date of the offer to settle, and in relation to which no order was made under that rule …

[13] In the circumstances, Rule 37B applies to the offer made by Mr. Baker.

[14] Rule 37B (5) and (6) read:

(5) In a proceeding in which an offer to settle has been made, the court may do one or both of the following:

(a) deprive a party, in whole or in part, of costs to which the party would otherwise be entitled in respect of the steps taken in the proceeding after the date of delivery of the offer to settle;

(b) award double costs of all or some of the steps taken in the proceeding after the date of delivery of the offer to settle.

(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 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.

[15] Subrule (5) is permissive. It empowers the court to make either type of order mentioned in the subrule. By necessary implication, it contemplates that the court may make an order that denies one of the two forms of relief set out in the subrule……….

The court then went on to canvass some prinicples of Bankruptcy law and concluded that the Defendant’s offer “was not one that reasonably ought to have been accepted (pursuant to Rule 37B(6)(a) on the date of the offer to settle or before the Rule 18A hearing at which time, pursuant to Rule 37(13), the offer was no longer capable of acceptance.“

The court then went on to deal with Rule 37B(6)(b) and held as follows:

Rule 37B (6) (b)

Rule 37B (6) (b)

[34] This subrule indicates that the court, when exercising its discretion under Rule 37B should consider the relationship between the offer and the result in the action. In this case, the offer to settle was for one dollar. There was no counterclaim. BCSPCA’s only risk was costs. An offer that would confer a significant benefit, aside from costs, on a party who failed to accept the offer would be more likely to attract double costs under Rule 37B that an offer of the type made by Mr. Baker.

Rule 37B (6) c)

[35] The means of the parties may be taken into consideration when exercising discretion under Rule 37B. The BCSPCA is a non-profit society dedicated to prevention of cruelty to animals. It is a substantial society. It had an operating surplus of $379,022 in 2007. Mr. Baker has not disclosed his financial circumstances. His counsel stated in submissions that he is of “modest means”.

Result

[36] In all the circumstances, Mr. Baker has not established that the offer he made was an offer that ought reasonably to have been accepted by BCSPCA under the law applicable during its currency. Acceptance would not have conferred a significant benefit on BCSPCA other that its effect on costs. Although BCSPCA is likely the party most able to bear the costs of the litigation, Mr. Baker has not shown that an award of double costs is, considering the other factors bearing on an award of costs under Rule 37B, necessary to avoid the imposition of hardship in the litigation.

It remains to be seen what the number of soon to be coming precedents will ultimatly hold for the interpretation of this rule, but this case illustrates that courts may not take to kindly to ‘nuisance value’ settlement offers of $1.

Blogging from Kelowna again (and a lot less rainy here than Victoria when I left this am)…

Reasons for judgement were released today awarding a Plaintiff just over $43,000 in damages as a result of a 2005 BC motor vehicle accident.

For the purpose of researching non-pecuniary damages, the key findings of fact were made starting at paragraph 132 of the judgement which I reproduce below. Of particular interest is the judge’s 25% reduction of non-pecuniary damages for the Plaintiff’s ‘failure to mitigate’ set out at paragraph 134:

[132] I conclude that the plaintiff suffered a mild to moderate soft tissue injury the symptoms of which were exacerbated by his very heavy work duties, his financial worries, and the poor health of his wife and daughter. The combination resulted in a lack of motivation to adequately do the exercises and instead, a reliance on medications, which his wife supplied. On the evidence before me, I find that the injuries to his neck and upper back had more or less resolved within ten to twelve months after the accident with occasional flare-ups. It is probable that even with appropriate exercising, these symptoms would have persisted that long because he was obliged to return to work too early.

[133] There has been a substantial impact on his enjoyment of life and I am satisfied that he is not able to participate in family activities as much as he could before, including doing the Grouse Grind and fishing with his daughter. His ability to perform previously done housework has also been affected, although I am not satisfied on the evidence of the extent of gardening/lawn mowing help required. The daughter’s boyfriend could have been called as a witness and the failure to do so or explain his absence rightly allows the defence to suggest that I should draw an adverse inference, and I do so. Nevertheless, I accept that the plaintiff is not as able to bend or stoop to paint or do repairs to the house and his car. Further, in part because of his pain, his marital relations with his wife have been affected.

[134] Taking all that into consideration I find that the appropriate compensation for his non-pecuniary loss is $40,000, but this amount must be reduced because of what I find has been a significant failure on his part to mitigate his injuries. He has failed to abide by the doctors’ and physiotherapist’s advice to engage in an appropriate exercise program. Although he said that he could not afford the program, he admitted that he had not even taken any steps to enquire as to the cost. Further, the plaintiff has not diligently performed the exercises that can be done at home and stops at the first sign of pain. He relied and relies too heavily on painkillers when, in the opinion of the medical experts, he should be properly exercising. The defendants are not obliged to compensate a plaintiff who fails to take proper steps to reduce the extent of the loss. Accordingly, I would reduce the non-pecuniary damages as well as some other heads of damages by 25% to reflect this failure and set them at $30,000.