Reasons for judgement were released last week by the BC Court of Appeal ordering ICBC to pay costs after the settlement of a matter following trial.
In last week’s case (Krohn v. Weidner) the Plaintiff was injured in a collision and sued for damages. Following trial the Plaintiff ” immediately identified some areas of concern” and tried discussing these with ICBC. ICBC refused to address these issues stating that “no discussions concerning the amount of the judgment without an appeal first being filed.”
The Plaintiff appealed and the parties eventually settled the outstanding issues. The Plaintiff sought costs but ICBC refused to agree to these arguing each party should bear their own costs of the appeal. The BC Court of Appeal ultimately ordered that ICBC bear the costs of the appeal and in reaching this conclusion provided the following reasons: [5] The appellant seeks costs of the appeal. The respondent, on the costs question, says that this is a case for an order that each party bear their own costs, consistent with Olney v. Rainville, 2010 BCCA 155, because this is a case, says the respondent, of divided success. [6] From what we have been told, it is apparent that the only route for the appellant to recovery of the undisputed disbursements as special damages was by pursuing this appeal. Accordingly, in our view, this is not a case that justifies departing from this Court’s usual rule that the party successful on an appeal recover his or her costs.
Reasons for judgment were published today by the BC Supreme Court, New Westminster Registry,(Berekoff v. McMath) finding that full Rule 15 costs were appropriate where a matter settled 3 months before trial and the only meaningful work that was left related to witness preparation.
In finding costs of $6,500 were appropriate in these circumstances District Registrar Cameron provided the following reasons: [2] The parties are at odds as to whether or not the costs that should be awarded to the Plaintiff as mandated by Rule 15-1(15) should be reduced at all from what is called the “cap amount”, or $6,500, for a matter that settles before trial. The Plaintiff asserts that the full amount should be awarded and the Defendant argues for a significant reduction to take into account that not all of the preparation for trial had been done on behalf of the Plaintiff before the settlement… [7] In this case, I am satisfied on the evidence that very significant preparation had been done by Mr. Caissie on behalf of the Plaintiff. He submitted if the case had not settled all he would have been left to complete was the final preparation of his client to give evidence at trial, to prepare the Plaintiff’s family physician and his chiropractor to ready them for giving their evidence at trial, and lastly, an attendance at a trial management conference that would have been held on July 11, 2013. [8] With all of this I would have awarded the Plaintiff the entire cap amount of $6,500. However, Mr. Caissie had agreed before this hearing that a 10% reduction should be applied and as such I will allow the costs as claimed of $5,850 plus applicable taxes.
Reasons for judgment were released this week by the BC Supreme Court, Vancouver Registry, addressing a technical procedural issue, namely which judge should address a costs application following a mistrial.
In this week’s case (Walker v. Doe) the Court declared a mistrial on the 14th day of a Jury trial following closing submissions of counsel for the plaintiff. The Defendant sought costs and an issue arose about who was best to address this, the presiding judge for the initial trial or the judge who would ultimately oversee the mistrial. The Court held it was appropriate, in the circumstances of this case, for the initial judge to address the costs issue. In reaching this conclusion Mr. Justice Voith provided the following reasons: [12] The broad question of whether there is a “longstanding practice” in this province that directs that the costs arising from a mistrial should be assessed by the ultimate trial judge misses an important aspect of the particular issue before me. The issue on this application is not, as the Response filed by the plaintiff suggests, whether “[t]he allocation of costs thrown away as a result of the mistrial should be in the ultimate cause or decided by the judge before whom the case is ultimately tried”. [13] The real issue, instead, is who should hear an application for costs, following a mistrial, when the dominant focus of that cost application is an order for special costs against counsel for the party that caused the mistrial. The fact that the dominant, if not overwhelming, focus of the defendant’s application is an order for special costs against counsel is patent from the submissions of the parties as well as from the materials and authorities that each has filed… [24] The benefit of having the judge who heard the trial and counsel’s submissions which gave rise to a mistrial, also hear the ensuing special costs application is obvious. In Cunningham v. Slubowski, 2004 BCSC 1204, Madame Justice McKenzie, as she then was, following a 20 day trial, heard an application for costs, including special costs, against counsel. She observed: [61] This trial was difficult for all concerned. Ms. Wellburn provided me with valuable assistance on this hearing. She made a valiant effort to grasp the course of the proceedings, but had the disadvantage of not having been counsel at trial. Counsel ordered a few transcripts of the proceedings, but I decided on 7 May 2003, on counsels’ request, that full transcripts were not justified by the expense. As the trial judge, I had the unique position of assessing the course of the proceedings at trial. My recollection remains vivid and, as referred to above, I have considered all the voluminous material filed on this application. [25] The foregoing comments are apposite. Notwithstanding the passage of time, my memory of the trial and of the matters leading to the mistrial remains good. My memory of many events remains vivid. Counsel for Mr. Walker sought to argue that another judge, with the benefit of transcripts and the Mistrial Ruling, would be in an equally good position to address the instant application. I do not think that this is so… 29] I do not consider that another trial judge could address such submissions as readily or as easily as I could. This is so even if extensive transcripts from the first trial were ordered… [30] I consider that the foregoing considerations remove this application from the ambit of the “general rule” referred to in Joy and that I should hear the defendant’s application. [31] I have also considered whether, having arrived at the foregoing conclusion, I should defer dealing with the substance of the application until after the appeal of the Mistrial Ruling. This would have the benefit of avoiding the costs that would be incurred in hearing the application and that would be wasted if the plaintiff is successful in its appeal of the Mistrial Ruling or, indeed, from these reasons. Conversely, if the Mistrial Ruling is upheld, I expect, having regard to the history of the matter, that any cost order I make will likely be appealed in any event. On balance I consider it better and more efficient to have each of the Mistrial Ruling, these reasons, as well as the eventual reasons from the cost application available before the hearing before the Court of Appeal takes place.
Reasons for judgement were released today by the BC Supreme Court, Vancouver Registry, addressing assesable costs when a fast track trial exceeds 3 days.
In today’s case (Peacock v. Paul) the plaintiff was involved in two collisions. Although only one of the cases was put into the fast track the Court deemed that Rule 15 applied to both actions. The trial took a total of 5 days. ICBC argued that costs should be capped at $11,000 but Mr. Justice Affleck declined to do so and used his discretion to increase costs by $1,500 for each additional day of trial. In reaching this conclusion the Court provided the following reasons: [20] Madam Justice Neilson held that the formula set out in Anderson v. Routbard, 2007 BCCA 193 should be applied to determine what amount should be awarded. This formula involves first determining what portion of the lump sum provided for in the Rule is for pre-trial and trial costs. Madam Justice Neilson calculated this by taking the amount enumerated for a one day or less trial and subtracting it from the amount allowed for a two day or more trial. The difference is then multiplied by the number of days that the trial went over (paras. 31, 39). She concluded: 39 I would therefore allow the appeal, and calculate costs under R. 66(29) as follows. Under the present limits of $5,000 and $6,600 I take the pre-trial portion of costs to be $3,400, and $1,600 as representative of each day of trial. The plaintiff’s offer to settle was delivered only six days before trial. Thus, she is not entitled to double costs for trial preparation. She is, however, entitled to double costs for three and a half days of trial, calculated at $3,200 per day. Total costs are thus $14,600 ($3,400 plus $11,200) before disbursements and taxes. [21] Similarly, this approach was used in Lam v. Chui, 2013 BCSC 1281 where the court considered the appropriate costs award in a fast track action where the trial took 13.5 days. The court held that the plaintiff was entitled to costs for 11.5 days after it deducted 2 days representing time wasted as a result of an error made by the parties concerning the date of the loan in question. Calculating the cost of a trial day at $1, 500 using the formula from Majewska, the court determined that the plaintiff was entitled to $23, 750 in costs ($11,000 for the first three days of trial and $1,500 per day for 8.5 days). The same approach was used inShiekh v. Struys, 2013 BCSC 1148. [22] In Coutakis v. Lean, 2012 BCSC 1447, the court considered a successful plaintiff’s claim for costs in a fast track action. The trial took five days including one day where trial did not proceed due to illness of the judge. The court held: 10 Under subrule 15-1(15), the court is given a wide discretion to order an amount of costs other than the fixed amounts set out therein. In my view, this is a case which clearly calls for the exercise of that discretion, in favour of the plaintiff. That the hearing of the evidence took three days, rather than two, was largely as a result of the defence’s cross-examination of four of the plaintiff’s treating physicians, and the defence’s tendering as opinion evidence of the consultation report of a neurosurgeon. Hearing the evidence of all of these physicians took more than three hours, and, as I stated in my judgment, all of it was ineffectual. Further time was spent hearing irrelevant evidence from the defendant. … 13 Using the amounts prescribed in the subrule as reference points, I award the plaintiff base costs of $14,000, plus disbursements. [23] In the case at bar, the trial took two days longer than contemplated by R. 15-1(15)(c). Applying the authorities discussed above, in my view, the costs award should exceed $11,000 by adding a further $1,500 for each of the additional days of trial for a total costs award of $14,000 not including disbursements.
One of the more difficult fact patterns to predict the outcome of is when will a Plaintiff be granted costs when they sue in the BC Supreme Court but are awarded damages below $25,000 (the monetary jurisdiction of the Provincial Court in BC). You can click here to read archived decisions addressing this. Adding to these, reasons for judgement were released this week considering such a scenario.
In this week’s case (Akbari v. ICBC) the Plaintiff was injured in a collision caused by an unidentified motorist. He successfully sued ICBC and was awarded damages of just over $13,000. Following this the Plaintiff sought costs of $17,000. Madam Justice Baker denied this finding the Plaintiff had no sufficient reason to sue in Supreme Court. In reaching this conclusion the Court provided the following reasons: [16] I am not persuaded that there was sufficient reason to bring this action in Supreme Court. As the plaintiff submits, the issue of liability was the primary issue at trial. The Provincial Court is an entirely appropriate forum for determining that issue, the outcome of which largely depended on an assessment of the credibility of the witnesses. [17] Ms. Berry of ICBC had no personal knowledge of the circumstances of the accident. I can surmise that questions put to her on discovery may have related to contact by ICBC representatives with one of the plaintiff’s witnesses, Mr. Nahun Chinchilla, whose testimony I rejected at trial as incredible and unreliable. Mr. Chinchilla voluntarily contacted both the plaintiff and plaintiff’s counsel and so far as I am aware, volunteered to be interviewed by plaintiff’s counsel prior to trial, so it was not necessary to utilize the Supreme Court Rules to compel his cooperation. [18] I am not persuaded that any documents and witness statements provided by the defendant to the plaintiff during the course of pre-trial preparation would not have been supplied by the defendant whether the action had been brought in Supreme Court or in Provincial Court. [19] I am not persuaded that there was any reasonable prospect that the plaintiff’s total damages would exceed $25,000. The special damages and past loss of income were known. The only head of damages involving uncertainty was non-pecuniary damages. The only medical evidence presented at trial was a report from Mr. Akbari’s family doctor, dated June 2, 2011. In my view, it should have been obvious to the plaintiff and his counsel, after considering that report, that an award in the range of $25,000 was highly unlikely. [20] The report and the opinions expressed in it were sufficiently non-controversial that Dr. Rai was not required to attend for cross-examination. In Dr. Rai’s opinion, Mr. Akbari suffered soft tissue injuries – described by Dr. Rai as “tendonious strain” affecting Mr. Akbari’s left calf, knee and thigh – from which he had recovered in 8 to 10 weeks. Mr. Akbari was off work for two weeks, but it was during the Christmas holidays and he had planned to take some vacation during that period in any event. The injuries caused little disruption to Mr. Akbari, only temporarily interfering with his participation in pick-up soccer games, and his weight-lifting routine at the gym. [21] In the plaintiff’s written submissions regarding costs, it was suggested that the concluding paragraph of my trial Reasons, in which I stated that I was not aware of any reason why the plaintiff should not have his costs on Scale B, was a determination of the issue. That is not correct. Unless a defendant invokes Rule 14-1, a plaintiff is normally entitled to costs. Once the Rule is invoked, then the court must consider whether there was sufficient reason to bring the proceeding in the Supreme Court. The plaintiff shall have disbursements only.
In a fairly routine exercise of the Court’s discretion, reasons for judgement were released this week by the BC Supreme Court, Vancouver Registry, ordering a Plaintiff to pay the Defendant’s trial costs for failing to best a pre-trial formal settlement offer in a personal injury claim.
In this week’s case (Wilson v. Honda Canada Financial Inc.) the Plaintiff was involved in a 2009 rear end collision. Fault was not at issue. Although the Court found that there “are serious issues regarding (the Plaintiff’s) credibility” Madam Justice Fitzpatrick concluded the Plaintiff suffered a variety of soft tissue injuries, some of which remained symptomatic on an intermittent basis at the time of trial. Six weeks prior to trial the Defendant made a formal settlement offer of just over $121,000. The Plaintiff sought an award well above this at trial but many of the claimed damages were rejected with the court assessing damages about $25,000 below the formal settlement offer.
The Defendant sought post offer costs and these were granted. In finding that a Plaintiff’s “honest belief” in entitlement to damages does not avoid the costs consequences intended by the Rules of Court, Madam Justice Fitzpatrick provided the following reasons: [11] Mr. Wilson argues that he “genuinely believed” that he had incurred a past and future wage loss because he was unable to work for Taja. With respect, it can hardly be the case that honest belief alone will avoid the intended effect of the Rule. This is similar to my rejection of his honest belief as to disability where that belief was not supported by any medical evidence: Reasons, para. 137. As set out in the Reasons, there were numerous difficulties with Mr. Wilson’s arguments regarding Taja, including the lack of proper documentation, lack of medical evidence, and a rejection of his testimony on this issue (see paras. 120-146, 157-163). His claim for future massage therapy of $30,000 was also rejected for the reason that no medical evidence supported that claim. [12] Finally, Mr. Wilson’s evidence also suffered from credibility problems particularly where not supported by other credible evidence: Reasons, para. 42. Failure to anticipate credibility issues will also not avoid the operation of the Rule: Gehlen v. Rana, 2011 BCCA 219 at paras. 50-51. [13] Mr. Wilson argues that he should not be penalized for “guessing wrong”, citing Fan (Guardian ad litem of) v. Chana, 2009 BCSC 1497. However, it is clear from the comments of the court in that case that there were difficult issues relating to the evidence and how any offer could be dealt with, particularly given the involvement of the public trustee. Similar difficulties do not arise in this case. [14] I agree that a party is not required to “guess” about the probable outcome; rather, he or she is required to fairly and objectively assess the evidence intended to be adduced at trial and make a reasoned decision about the relative merits of the claim or defence, having in mind a certain amount of litigation risk. In essence, the party receiving the offer must critically review the merits of the claim in relation to the amount offered. As the court noted in Fan, quoting A.E.: [62] Regardless of the merits of the plaintiff’s claim the defendant’s offer to settle cannot be ignored, because to do so would undermine the purpose of the Rule. Having decided to proceed in the face of a not insignificant and ultimately successful offer to settle, the plaintiff cannot avoid some consequences. [15] The offer amount, while not approaching the amounts sought by Mr. Wilson, in all likelihood fairly assessed the claims about which there was no dispute and added further amounts for the litigation risk that the more contentious claims would go against the defendants. The offer was, no doubt, also prepared recognizing the substantial cost to both parties if the matter proceeded to trial. It cannot be understated that one of the purposes of the Rule is to avoid costs of proceeding further in the action: Martin, para. 8. [16] I conclude that the offer should reasonably have been accepted by Mr. Wilson shortly after it was made and that this factor favours the defendants… [24] I conclude that all factors to be considered under Rule 9-1(6) favour the costs award sought by the defendants. Accordingly, Mr. Wilson will recover his assessed costs and disbursements up to April 27, 2013, which is 5 days after the offer was sent in recognition that some reasonable period of time would have been necessary to consider the offer. Thereafter, the defendants will recover their assessed costs and disbursements commencing April 28, 2013. After assessment of these respective amounts, the parties shall set off the awards to produce a net award.
Reasons for judgement were released last week by the BC Supreme Court, Nanaimo Registry addressing two important topics; the assessment of costs for fast track actions when they settle before trial and the recoverability of Trust Administration Fees as a disbursement.
In last week’s case (Christen v. McKenzie) the Plaintiff settled his ICBC claim after litigation was well underway for specified damages plus “costs payable“. The parties couldn’t agree on these with the Plaintiff seeking full Rule 15 costs and ICBC arguing that a lesser amount should be paid because “a number of pre-trial steps involving a substantial amount of work were still required to be performed as the case settled seven -and-a-half months prior to the commencement of trial“. Madam Justice Arnold-Bailey awarded the full cap noting that while the trial was a ways off significant trial preparation steps were undertaken and this was sufficient to trigger the Rule 15 cap. The Court provided the following reasons: [35] To my mind significant preparation for trial ought to be sufficient to entitle the successful party to costs for pre-trial preparation to the full amount of the cap, presently $6,500 pursuant to Rule 15-1(15). Pre-trial preparation may take various forms given the demands of the particular action. Whether the parties engage in extensive negotiations or mediation and thus achieve a settlement months or days before trial, the preparation by counsel may easily approach that required to actually conduct the trial. The focus ought to be on the amount of useful preparatory work done and not where in the pre-trial timeline the resolution was reached. Indeed, the focus of Rule 15-1 and the Civil Rules generally is to encourage early and fulsome preparation to resolve cases earlier as opposed to later if possible; and also to limit the scope of the proposed trial to what is truly at issue, thus reducing the time and costs associated with resolving the dispute. [36] In the present case it is clear that the matter was substantially prepared to the level necessary to achieve a significant settlement prior to trial. While there may be fast track cases where a review of the costs amount claimed for preparation is warranted, this is not one. However one dissects and analyzes what was done or not done to prepare this case for trial, a considerable amount of preparation was performed by plaintiff’s counsel to achieve the sizable settlement. Extensive and protracted negotiations, such as occurred here, ought not to be regarded as requiring significantly less preparation than preparing a case for mediation or trial. Indeed, such negotiations are to be encouraged as the most cost‑effective way of dealing with cases that would otherwise proceed to trial. The efficacy of conducting a fast track action ought not to be undermined by a costs analysis that bogs down in the picayune.
The Court also noted that a Trust Administration fee is a fair disbursement a successful litigant can claim. Madam Justice Arnold-Bailey provided the following comments addressing this: 37] I note that the plaintiff’s claim for the trust administration fee of $10 plus $1.20 in taxes is not now disputed by the defendant McKenzie and the third party. The following authorities support it being claimed:Parrotta v. Bodnar, 2006 BCSC 787 at para. 25; Polubinski v. Twardowski, 2007 BCSC 843; and McCreight v. Currie, 2008 BCSC 1751. Therefore the plaintiff’s claim for $11.20 in relation to the trust administration fee (including tax) is successful.
Short and to the point reasons for judgement were released this week by the BC Supreme Court, Vancouver Registry, awarding a plaintiff double costs after proceeding to trial and besting a pre-trial settlement offer.
In the recent case (Codling v. Sosnowsky) the Plaintiff was injured in a motor vehicle collision. Prior to trial she made a formal settlement offer for $55,000. ICBC rejected this and proceeded to trial where she was awarded just over $70,000. The Court awarded the Plaintiff double costs for besting the offer. ICBC argued that it was premature to settle costs as the case was under appeal. Mr. Justice Smith quickly disposed of this argument providing the following reasons: [3] The defendant also says it is premature to deal with costs because he has filed an appeal and even partial success could reduce the award to an amount below the offer to settle. I do not accept that argument. The duty of this court is to finalize its own judgment. If the Court of Appeal finds that judgment to be in error, the costs consequences will change accordingly.
In confirming that this was an appropriate case for double costs Mr. Justice Smith reasoned as follows: [7] On the basis of the evidence that the parties could reasonably have anticipated being called at trial, I find that the plaintiff’s offer represented a reasonable effort to assess her possible recovery. It was one the defendant should have recognized as being within the range of possible awards and ought reasonably to have been accepted, particularly when weighed against the cost of going to trial. I recognize that liability was denied and the plaintiff’s offer made no apparent discount for risk on that issue, but this was a rear-end collision and the defendant had little prospect of success on liability or contributory negligence.
Reasons for judgement were released last week by the BC Supreme Court, Vancouver Registry, addressing costs consequences following a trial where ICBC marginally beat their pre-trial settlement offer.
In last week’s case (Wattar v. Lu) the Plaintiff was injured in a collision in which she and the Defendant were found equally at fault. After the liability split the Plaintiff’s net damages awarded at trial came to $26,000. Prior to trial ICBC made a formal offer of $27,500. ICBC applied for costs consequences to flow from the Plaintiff’s choice to proceed to trial. Mr. Justice Smith exercised his discretion and refused to award such consequences noting that the unrecovered potion of damages due to the operation of the Negligence Act was punishment enough. The Court provided the following comments: [13] This was a three-day trial. In the absence of an offer to settle, the plaintiff would have been entitled to half of her costs, or $5,500, to reflect the division of liability. That would include $2,250, representing half of the costs attributable to three days of trial ($1,500 times three, divided by two). That is the proper amount by which to reduce the plaintiff’s costs as a consequence of her refusal to accept the settlement offer. [14] Counsel for the plaintiff argues that the plaintiff should recover all of her disbursements related to damages because she was substantially successful on that issue, but for the reduction resulting from the liability finding. I cannot accept that argument because the offer clearly encompassed a reasonable assessment of the plaintiff’s damages, discounted for the substantial liability risk. Acceptance of the settlement offer would have made it unnecessary for the plaintiff to prove her damages at trial. [15] The plaintiff is therefore entitled to costs of $3,250, plus one half of her disbursements to the date of the offer. In view of the modest award and the relatively small gap between the offer and the judgment, I do not consider it appropriate or necessary to further punish the plaintiff with an award of any portion of the defendant’s costs.
Three years ago the BC Court of Appeal clarified that a Defendant’s insured status can be taken into account when considering costs consequences in a trial where a formal settlement offer was in place. Reasons for judgement were released this week by the BC Supreme Court heavily relying on this factor in denying a Defendant post offer costs.
In this week’s case (Currie v. Taylor) the Plaintiff was involved in a 2008 collision. Prior to trial ICBC offered to settle the issue of liability with the Defendant shouldering 41% of the blame. The plaintiff rejected this offer and proceeded to trial where a less favorable split of 75/25 was obtained.
The Defendant sought post offer costs. Mr. Justice Armstrong did strip the Plaintiff of trial costs but did not award these to the Defendant either. In reaching this conclusion the Court provided the following comments about the significance of the Defendant’s insured status: [65] The defendants accept that the plaintiff is financially disadvantaged and that they are represented by an insurer. The defendants’ bill of costs has been presented in the sum of $30,000.32 whereas the plaintiff has disclosed an expenditure of disbursements exceeding $56,000. The plaintiff has not provided a draft bill of costs and I accept that the majority of those disbursements may relate to the issue of quantum. There is simply insufficient evidence on this point to influence the decision. [66] However, I am guided by the comments of Sewell J. Wong-Lai where he said: [52] I have also given consideration to the relative financial circumstances of the parties. The plaintiff has very limited means. The defendants are covered by insurance and in a very real sense it is the defendants’ insurer who is at risk in this action. I am entitled to take this factor into consideration in exercising my discretion: see Smith v. Tedford, 2010 BCCA 302, 7 B.C.L.R. (5th) 246. Given these circumstances, it is obvious that the relative financial consequences of depriving the plaintiff of her costs are much greater to the plaintiff than to the defendants. [67] I accept that there is a significant disparity between the financial resources of the parties and that the plaintiff has very limited means whereas the defendants are supported by an insurer and are at little risk in this action. [68] I will not order the plaintiff to pay the defendants’ costs after the delivery of their offer to settle. I have accepted the plaintiff’s arguments: there was a reasonable explanation for the plaintiff’s failure to accept the offer, the magnitude of the plaintiff’s claim is substantial, and there is a substantial discrepancy in the resources of the parties. [69] Accordingly, the plaintiff will recover 25% of his costs at Scale B until the date of trial. The defendants will not recover costs.