More on BC Supreme Court Costs – Rule 57(10) and Judgments Below $25,000

(Note: The below case was upheld by the BC Court of Appeal.  You can find the BCCA decision here.)
As recently discussed, when advancing an ICBC Claim in Court one of the first choices to make is whether to sue in BC Supreme Court or Small Claims Court.   When a Plaintiff successfully sues in the BC Supreme Court they are usually entitled to “costs” from the Defendant.  Costs are intended to offset some of the expenses of requiring a formal lawsuit to reach a resolution to a claim. The Small Claims Court does not have the ability to award Costs.
One of the exceptions to this general principle of giving successful Supreme Court plaintiffs “Costs” is set out in Rule 57(10) which holds that “A plaintiff who recovers a sum within the jurisdiction of the Provincial Court under the Small Claims Act is not entitled to costs, other than disbursements, unless the court finds that there was sufficient reason for bringing the proceeding in Supreme Court and so orders.
So if a Plaintiff is awarded under $25,000 (the current limit of the Small Claims Court) in an ICBC or other BC Injury Claim does this mean they will be deprived of Court Costs?  The answer is not necessarily.  Our Supreme Court has held time and time again that a Plaintiff may have sufficient reasons for suing in Supreme Court despite the fact the final outcome may be an award below $25,000 and reasons for judgement were released today by the BC Supreme Court, Vancouver Registry, discussing this.
In today’s case (Gradek v. DaimlerChrysler Financial) the Plaintiff was injured in a BC car crash.  He sued in the BC Supreme Court and was awarded just below $10,000 in total damages (you can click here to read my article summarizing the trial judgement).  The Plaintiff asked for Costs.  The Defendants opposed this arguing that since the value of the case within the Small Claims Courts Monetary Jurisdiction the Plaintiff did not have “sufficient reason” to sue in the Supreme Court.
Mr. Justice Savage rejected this argument and summarized the law relating to “sufficient reason” to sue in the BC Supreme Court as follows:

[18] In my opinion the approach taken by the defendants is too narrow and not supported by an interpretation of the Rule or by the authorities.

[19] The proviso in Rule 57(10) is “unless the court finds that there was sufficient reason for bringing the proceeding in Supreme Court and so orders”.  The Rule does not define “sufficient reason”.  There is nothing in the Rule that limits the extension of the term “sufficient reason” to matters relating to the quantum of the claim.  ..

[27] There are relevant authorities in this court.  In Faedo v. Dowell, 2007 BCSC 1985, a case predating Reimann, Curtis J. held that a variety of factors gave rise to “sufficient reason” within the meaning of Rule 57(10).  The Court referred to the plaintiff’s beliefs about her claim, the defendant’s denial of liability, challenge to the plaintiff’s credibility, the plaintiff’s inexperience and demeanor, the reasonable requirement to have counsel, and the fact that costs of counsel were only recoverable in Supreme Court.

[28] Master Patterson in Garcia v. Bernath, 2003 BCSC 1163, 18 B.C.L.R. (4th) 389 (S.C.), held that a number of factors including whether there were injuries at all, can give rise to sufficient reason.

[29] In Johannson v. National Car Rental (Canada) Inc., 2009 BCSC 1284, Barrow J., referred to Reimann, and noted in obiter dicta that other reasons for proceeding in Supreme Court include those identified in Kuehne.

[30] In Tucker v. Brown, 2008 BCSC 734, Cole J. applied Reimann noting the importance of discovery procedures in determining liability in a “no crash no cash” case.

[31] In Kanani v. Misiurna, 2008 BCSC 1274, Humphries J. considered factors such as a denial of liability in finding “sufficient reason” under the Rule.  To like effect is the decision in Ostovic v. Foggin, 2009 BCSC 58.

[32] In the result, in my view, the term “sufficient reason” within the meaning of the rule encompasses a number of considerations including considerations which do not inform the quantum of the claim.

Mr. Justice Savage went on to award the Plaintiff his trial costs finding that despite the fact that the case could have been tried in Provincial Court given its monetary value the Plaintiff had sufficient reason to sue in the Supreme Court for a variety of reasons including the fact that the examination for discovery evidence was useful at trial and that the Plaintiff would have been “out-matched” if he sued the insured defendant without the assistance of a lawyer in small claims court.

In my continued effort to cross reference the current Supreme Court rules with the new Rules of Court that come into force on July 1, 2010 I will note that the Current Rule 57(10) will become Rule 14-1(10) and it reads identical to the current rule so the precedents developed under Rule 57(10) regarding costs should continue to assist litigants under our new rules.

Costs in the BC Supreme Court, Gradek v. DailerChrystler, Mr. Justice Savage, Rule 14-1(10), Rule 57(10), Sufficient Reason for suing in Supreme Court

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ERIK
MAGRAKEN

Personal Injury Lawyer

When not writing the BC Injury Law Blog, Erik is the managing partner at MacIsaac & Company, based in Victoria, B.C. He is also involved with combative sports regulatory issues and authors the Combat Sports Law Blog.

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