Full Rule 15 Costs Apply Where"Significant Preparation For Trial" Undertaken – TAF is Recoverable Disbrursement

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.

Rule 15 Costs Apply to Fast Track Settlement Agreement

Reasons for judgement were released this week by the BC Supreme Court, Victoria Registry, confirming that a settlement agreement made in a Rule 15 action for an amount “plus costs” contemplates costs capped under the fast track rule.
In this week’s case (Wan v. Smith Estate) the Plaintiff was prosecuting an injury claim under Rule 15.  As trial neared the Plaintiff accepted a defence settlement offer of $60,000 “plus costs and disbursements” .  The Plaintiff then sought Tarriff costs of over $17,000 as opposed to the capped pre-trial costs of $6,500 under Rule 15.  Mr. Justice Punnett held that Rule 15 costs applied to the settlement agreement.  In coming to this conclusion the Court provided the following reasons:
[13]         It is not disputed that the fast track rule governs.  The plaintiff asks the court to exercise its discretion under the fast track rule.  Her counsel refers to the wording in 15-1(15) “unless the court otherwise orders” in support.  The defendant submits that the reference to “the court” in that section is a reference to the trial court not this Court in chambers.  That is that cost awards are within the discretion of the trial court.  Further they submit that the offer and its acceptance were clear and the costs referenced in the settlement are to be awarded pursuant to Rule 15-1.
[14]         The difficulty with the plaintiff’s submission is counsel’s letter confirming settlement responds to the defendant’s offer of costs.  That offer was clearly for costs under the fast track rule.  In my view the plaintiff cannot now seek to redefine what was meant by “costs”.  It is inappropriate for the court to now vary the agreed upon terms of settlement.

Fast Track Costs Apply Despite 4 Day Trial

As previously discussed, Rule 15 is applicable to BC Supreme Court injury trials with a quantum of less than $100,000 or to trials that can be completed in three days or less.   This week reasons for judgement were published by the BC Supreme Court, Vernon Registry, addressing what costs flow following a Rule 15 trial which exceeds three days.
In this week’s case (Travelbea v. Henrie) the Plaintiff was injured in a collision.  Following a four day trial which was prosecuted under Rule 15 damages of just over $68,000 and costs were awarded.  The Plaintiff sought costs under the Tarriff and the Defendant argued that the capped costs of Rule 15 should apply.  Mr. Justice Barrow agreed with the Defendant and noted that there is nothing sufficient in a trial exceeding three days to depart from Rule 15 costs.  The court provided the following reasons:
6]             In general, the case was conducted in accordance with the parameters set by Rule 15-1. The plaintiff did not conduct an examination for discovery of the defendant. The defendant’s examination for discovery of the plaintiff was completed within two hours. There were no interlocutory applications by either party. The only substantive exception to the limitations imposed by the fast-track regime is that the trial spanned four days…
[10]         The only aspect of this case to which the plaintiff points by way of special circumstance is that the trial was set for four days and, in fact, took almost four days to be heard. I am not persuaded that the circumstance is sufficient to justify otherwise ordering. First, when the notice of trial was filed indicating that four days would be necessary, the plaintiff was content that the matter should remain in the fast-track regime. That is apparent by virtue of the endorsement on the notice and the fact that no application to the court or request to the defendant was made seeking to remove the case from the regime. Second, although the trial took more than three days, it took only marginally more, less than half a day.
[11]         I acknowledge the plaintiff’s submission that the case may have taken much longer had counsel not dealt with the matter so efficiently and co-operatively. To accede to that submission would be, in effect, to sanction a party for doing that which the Rules are intended to promote, namely, to conduct trials in an expedient and efficient way.
[12]         In the result, I am satisfied that the lump sum costs provided for in Rule 15 ought to be imposed in this case, and I order that the plaintiff is entitled to costs under Rule 15-1(15)(c) in the amount of $11,000.

"Compelling Facts and Circumstances" Required to Depart from Rule 15 Pre-Trial Settlement Cap

Further to my previous posts on this topic, reasons for judgement were released last week by the BC Supreme Court, Vancouver Registry, confirming that when a Rule 15 matter settles pre-trial and the settlement agreement incorporates costs, these should be assessed at $6,500 unless there are compelling facts and circumstances.
In the recent case (Ostadsaraie v. Shokri) the Plaintiff settled his claim 55 days prior to the scheduled trial and also prior to his Trial Management Conference.   The Plaintiff sought $6,500 in costs and Registrar Cameron agreed this amount was appropriate   After canvassing the relevant authorities the Court provided the following reasons:
[8]             In this case, Ms Neathway had done a substantial amount of preparation and delivered a settlement offer that resulted in a settlement of the case some 55 days before trial. There was a housekeeping matter left to be done, a trial management conference – but given the settlement, it did not occur.
[9]             Ms Neathway had delivered all of her expert reports and had prepared and completed all of the discovery in readiness for trial. She was frank to say that she would have needed to interview again one or more of the witnesses that would be called at trial and of course complete the final preparations for her client to give his evidence at trial. Nonetheless, a substantial amount of the preparation had in fact been completed by the time the settlement was made and in the circumstances it is appropriate to award the plaintiff the full amount of the cap…

$20,000 Non-Pecuniary Assessment for "Relatively Mild But Likely Permanent" Soft Tissue Injuries

Reasons for judgement were released recently by the BC Supreme Court, Vancouver Registry, dealing with damages for minor soft tissue injuries following a so-called ‘low velocity impact‘ collision.
In the recent case (Wallner v. Uppal) the Plaintiff was involved in a 2008 rear-end collision. Fault was admitted.  The collision was relatively minor causing just under $450 worth of vehicle damage.  Despite this the Plaintiff suffered a soft tissue injury to her neck and shoulder.  Her symptoms were “mild” but were expected to linger into the future.  In assessing non-pecuniary damages at $20,000 Madam Justice Stromberg-Stein provided the following reasons:
[14]         The plaintiff’s claim is for damages for a permanent partial disability relating to her intermittent ongoing neck, upper back and shoulder pain and left arm pain, and numbness and tingling she says is caused by the accident.  The plaintiff acknowledges her condition is relatively mild but maintains it is persistent and likely permanent.  She claims she experiences pain and discomfort while commuting to work, at work, doing household work, and during recreational activity.  She complains of intermittent weakness and lack of sensitivity in her left hand.  She claims she is unable to predict when she will be symptomatic.
[15]         In this case, in addition to minimal cosmetic damage to the vehicles, the plaintiff’s subjective complaints were not objectively verifiable, and in any event her injuries were minor and of minimal impact on her life.  The plaintiff has not missed any work and has no claim for past wage loss or for loss of future earning capacity despite maintaining a permanent partial disability.  The evidence establishes the plaintiff suffered soft tissue injuries of a minor nature, with continued minor, intermittent numbness and tingling in her left arm and fingers, which injuries have had and will have minimal impact on her life.
[16]         In the result, based on an assessment of the evidence and considering the authorities relied on by counsel, the plaintiff is awarded general damages in the amount of $20,000.  In addition, she is awarded special damages in the amount of $283, with court order interest.  With the agreement of counsel, costs are set pursuant to Supreme Court Civil Rules, R.15-1(15)(c) at $11,000 and disbursements.

Rule 15 Caselaw Update – Costs For Trials Exceeding Three Days

Adding to this site’s archived caselaw dealing with BC Supreme Court’s Fast Track Rule, reasons for judgement were released addressing the appropriate costs for a Fast Track trial which exceeds 3 days.
Rule 15-1(15)(c) fixes costs for fast track trials which exceed two days at $11,000 “unless the court otherwise orders”.   In the recent case (Coutakis v. Lean) the Court held that the circumstances were appropriate to depart from this default amount.
In the Coutakis case the Plaintiff suffered C6/7 disk herniation.   His claim proceeded via fast track trial and ultimately took more than three days to conclude.  The Plaintiff argued that the $11,000 costs cap should be set aside to account for the lengthier than anticipated trial.  Mr. Justice Saunders agreed finding that the pronged hearing was due in part to the Defendant leading “irrelevant” and “ineffectual” evidence.  In assessing costs at $14,000 the court provided the following reasons:
[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.
[11]         I find that the plaintiff is entitled to costs for each of the four days spent hearing evidence and argument, and for the fifth day which was scheduled but on which the trial did not proceed.
[12]         The plaintiff seeks a further allocation for additional preparation associated with the trial being continued eight months after it commenced.  Having reviewed the evidence before the court on the third day of trial, I do not think that the additional preparation would likely have been significant, and in any event any further cost incurred by the plaintiff is addressed by having awarded the plaintiff full costs for the aborted day of trial.
[13]         Using the amounts prescribed in the subrule as reference points, I award the plaintiff base costs of $14,000, plus disbursements.
 

Notice of Fast Track Action Does Not "Turn Any Action Into a Fast Track Action"


One practice that has arisen since the new rules of court were introduced a few years ago relates to parties occasionally slotting actions into the fast track rule when the case is not suitable for fast track litigation.  Reasons for judgement were released last week by the BC Supreme Court, Vancouver Registry, discussing this practice finding that a Plaintiff’s claimed damages (as opposed the Defendant’s perceived valuation) is a driving force.
In last week’s case (Narain v. Gill) the Plaintiff was injured in a motor vehicle collision.  In the early stages of litigation ICBC filed a Notice of Fast Track.  Prior to trial the Plaintiff made a formal settlement offer of  $200,000 and the Defendant provided a formal offer of $102,500.  Following trial damages of $116,737 were assessed.  At issue was the appropriate costs award.   Mr. Justice Meiklem had to decide whether the Notice of Fast track made the lesser Rule 15 costs scale applcable.  In deciding that the plaintiff’s valuation is a driving factor the court provided the following reasons:
[12]         Counsel for the third party argues that the plaintiff was notified that the third party considered this to be under Rule 15-1 with the filing of the notice and a matter is only removed from fast track by court order, either by the court on its own motion, or the application of any party and the court so orders, as provided by Rule 15-1(6)…
[17]         As I read Rule 15-1(2), the simple filing of a notice of fast track action in form 61 does not turn any action into a fast track action; rather, any party may file such notice “if this rule applies to an action” [my emphasis]. It is Rule 15-1(1) that defines when the rule applies, and it is important to note that the monetary criteria set out in subrule (1)(a) depends on the total amount of money claimed by the plaintiff for pecuniary loss and to be claimed by the plaintiff for non-pecuniary loss.
[18]         Counsel for the plaintiff in the case at bar communicated to counsel for the third party his belief that the claims being advanced exceeded the $100,000.00 limit. After that communication, there was no insistence on the action proceeding as a fast track action, and it would be reasonable to infer from third party counsel’s subsequent conduct in not adding the required notation to subsequent filings, agreeing to an extension of the trial estimate to five days and making a formal offer exceeding the $100,000.00 limit, that third party counsel had tacitly agreed with plaintiff counsel’s view that this was not an action to which Rule 15-1 should apply.
[19]         In short, I do not view the failure to add the required notation to the style of cause as an irregularity curable by amendment in order to conform to reality, as was done in the Foster case. This is not an action in its infancy that would benefit from an amendment making it clear that it is subject to Rule 15-1. This action was never clearly within the definition set out in Rule 15-1(1), and the filing of a form 61 notice did not change that.
[20]         That being said, hindsight will hopefully instruct counsel to clarify opposing counsel’s intentions, and, if necessary, seek an order by consent or otherwise to avoid similar circumstances arising in the future.

Costs Update: More on Rule 15 and Pre Trial Settlement Costs

Last year reasons for judgement were released discussing the lump sum costs available to parties under Rule 15.  Reasons for judgement were recently published by the BC Supreme Court, Vancouver Registry, finding that the quantum pre trial Rule 15 settlement costs should remain a matter of discretion.
In the recent case (Benz v. Coxe) the parties settled a personal injury claim for an undisclosed quantum plus costs.  The parties could not agree to the amount of costs and the issue was put before the Court.  Ultimately Registrar Sainty held $6,5000 was an appropriate quantum of costs on the facts of the case (settled in the mature phase of litigation) but held that no hard and fast rule should exist making this amount appropriate across the board.  In doing so the Court provided the following reasons:

[15] I appreciate the submissions of counsel. I have found those of Mr. Jeffrey to be more persuasive than those of Mr. Cope. I am going to continue to support my decision in Cathcart No.1 for a variety of reasons.

[16] Firstly, I think it is important to note, as Harvey J. confirmed in Gill v. Widjaja, supra, that Rule 15-1(15) gives the Registrar wide discretion in determining the appropriate tariff amount. If I were to accede to Mr. Cope’s submission — that in every case you get the cap unless there are special circumstances — I believe that, would be taking away from the discretion given to the Registrar to make these types of decisions.

[17] Secondly, I think Mr. Cope’s approach, rather than taking away from confusion, makes matters more confusing. I do not think one can draw a line in the sand and decide, for example, that where there has been discovery and there are no other special circumstances, you get the cap. However, If there has been no discovery and there are no other special circumstances (yet to be decided and which must be argued), you will probably get some proportion of the cap. One might still end up in the same position. Because whether you call it special circumstances, parsing out, or rough and ready, the parties will still end up assessing costs before a registrar who would then decide where the case was, in terms of preparedness, and who would also have to decide if there are (or are not) special circumstances such that the cap or something less might be awarded.

[18] I agree with Mr. Jeffrey, who submitted that the fairest approach in these types of circumstances is to consider all of the circumstances of the action. I also agree that the fact Harvey J. says one should not get bogged down in the details does not take away from the rough and ready approach, which is actually more fair, I think, to all the parties, because to make discoveries, say, the arbitrary line in the sand could result in some injustices. For example, there may be those odd circumstances where no discoveries have been conducted and were set for a week or two before trial for some reason or other. In those circumstances, using Mr. Cope’s “line in the sand”, a plaintiff might have to apply to a registrar to find special circumstance so that they might get the full cap amount (or something approximating it) if the case settled before the discoveries had been conducted but still, essentially, on the eve of trial.

[19] On the basis of all of the above, I stand by my decision in Cathcart No.1.

Examination for Discovery Caselaw Update: Scope of Proper Questions


Two useful, albeit unreported, cases were recently provided to me dealing with objections to two fairly common examination for discovery questions and dealing with their propriety.
In the first case (Blackley v. Newland) the Plaintiff was injured in two motor vehicle collisions.  In the course of examining the Defendant for discovery, the Plaintiff’s lawyer asked a series of “do you have any facts known or knowable to you” questions addressing the specific allegations set out in the Pleadings such as:

  • do you have any facts known or knowable to you that relate in any way to whatever injuries Mr. Blackley received in this collision?
  • do you have any facts known or knowable to you that relate in any way to what pain or suffering Mr. Blackley has had because of this collision?

At trial, the Plaintiff proposed to read this series of questions and the answers that followed to the Jury.  Mr. Justice Williams held that while the exchange should not go to the jury as its prejudicial effect outweighed its probative value, the series of questions was entirely appropriate in the context of an examination for discovery.  Mr. Justice Williams provided the following comments:
[10]  Speaking generally, in this case, I do not find that the questions asked at the examination for discovery are improper.  They can be said to have been substantially informed by the statement of defence that was filed by the defendant.  As is usual, that statement of defence is replete with denials and positings of other alternative propositions.
[11]  The examination for discovery conducted by plaintiff’s counsel was obviously shaped in part as a response to the pleadings of the defendant and was an appropriate use of the examination process, specifically to discovery the defendant’s case.
In the second decision (Evans v. Parsons) the Defendant put a medico-legal report to the Plaintiff and asked the broad (and arguably compound) question “Okay.  Was there — the facts in Dr. Aiken’s report, was there anything that struck you as incorrect?“.  The Plaintiff’s lawyer objected to the question resulting in a chambers application.  The Defendant argued the question was fair and further that the limited two hour discovery in Rule 15 matters allowed this type of a short cut question.
Master Caldwell disagreed finding the question was too broad and vague.  In doing so the Court provided the following reasons:
All right.  Thank you.  Applications to have a subsequent examination for discovery done specifically to address what I do find as an extremely general and vague question which was asked and objected to at the first discovery.  That comment probably leads one to surmise the application will be dismissed, at it will.  There was an opportunity to specify what facts were being referred to, and counsel refused to further qualify.  There’s a reason for short discoveries in rule 15-1 cases.  Two hours were granted.  If this was an important question, it could have been addressed earlier in the discovery.  I don’t, in the circumstances of the context of the question, believe it to have been a fair question to the plaintiff.  It was far too general, and, as I say, defence counsel refused the opportunity to further qualify or narrow it.  I’m not going to force the Plaintiff to answer such a general question.  Application is dismissed.  Costs to the Plaintiff.
To my knowledge these judgements are not yet publicly available.  As always, I’m happy to provide a copy to anyone who contacts me and requests copies.

$50,000 Non-Pecuniary Assessment for "Myofascial Pain Syndrome"; Rule 15 Soft Cap Exceeded

Adding to this site’s expanding database for BC soft-tissue injury assessments, reasons for judgement were released last week by the BC Supreme Court, Vancouver Registry, addressing damages for chronic soft tissue injuries with a poor prognosis.
In last week’s case (Bissonnette v. Horn) the Plaintiff was involved in a 2007 collision.  Fault was admitted focusing the trial on damages.  The Court found that the Plaintiff suffered various soft tissue injuries involving her beck, back hip and leg.  The injuries continued to cause difficulties to the time of trial and were expected to linger into the future.  In assessing non-pecuniary damages at $50,000 Madam Justice Gray provided the following reasons:

[74] I accept the evidence of Dr. Frankel that Ms. Horn continues to suffer with left hip, neck, left leg, and lower back pain, disturbed sleep patterns, headaches, anxiety, and weight gain as a result of her motor vehicle related injuries. I also accept his opinion that, as these symptoms have continued for over four years since the accident, her prognosis for full recovery is guarded. Dr. Chu testified that the prognosis was fairly good for Ms. Horn’s widespread myofascial pain syndrome and that it usually responds to active exercise and treating sleep or mood disturbances. I accept this evidence as well….

[76] Ms. Horn’s continuing pain has diminished since the accident, but remains significant enough to affect her work, recreation, and sleep. She suffered other symptoms closer to the accident, including severe headaches, a broken tooth, and a finger injury.

Global damages of just over $100,000 were awarded demonstrating the soft cap in action set out for fast track trials in Rule 15.  This is not the first time this has happened since the new rules came into force and also confirms the disjunctive nature of Rule 15 allowing for the prosecution of claims over the $100,000 damage cap.

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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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