Court Declines to Award Plaintiff Double Costs Where Adverse Liability Finding was a “Live Possibility”

Often times when a plaintiff is awarded damages beyond their formal settlement offer the BC Supreme Court awards double costs.  Such an outcome is discretionary and not automatic and occasionally double costs are declined.  Reasons for judgment were published this week by the BC Supreme Court, Chilliwack Registry, with such an outcome.

In this week’s case (Enns v. Corbett) the Plaintiff was injured in a collision and sued for damages.  The Plaintiff was awarded damages approximately $30,000 above their formal settlement offer.  Despite this the Court declined to award double costs noting there was a ‘live possibility‘ of an adverse liability outcome.

In reaching this conclusion Mr. Justice Riley provided the following reasons:

[7]             I do not agree with the plaintiff that the offer ought reasonably to have been accepted as contemplated in Rule 9-1(6)(a). Rather, I agree with the defendant that at the time the offer was made, there was uncertainty as to the strength of the plaintiff’s claim, due in large measure to issues of contributory negligence and potential apportionment of liability. Despite the live issues as to liability, the plaintiff’s offer expressly rested on the premise that the defendant would be found “fully liable” for the collision; it made no allowance for the contingent risk that the plaintiff might be found contributorily negligent, which was a live possibility based on the evidence available to the parties when the offer was made. To quote from the defendant’s submission, the plaintiff’s offer “did not account for the real risk that the plaintiff’s claim might have been dismissed entirely or that liability might be apportioned, based on information available to the parties at the time”. As explained in Owen v. Folster, 2019 BCSC 407 at para. 12, the plaintiff’s offer did not put forward a “genuine compromise or an incentive to settle” in view of the litigation risks, such that the defendant did not act unreasonably in declining to accept it.

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[12]         In my view, the most telling feature of this case is the fact that the offer to settle was premised on the plaintiff’s position that the defendant would be found fully liable for the collision, when there were live issues as to apportionment of liability. In these circumstances, it cannot be said that the offer “ought reasonably to have been accepted”. The other factors are less important in this particular case. The judgment obtained at trial was higher than the amount in the offer, but only marginally so as a proportion of the overall amount in issue. And, although the defendant’s insurance coverage placed her at some degree of financial advantage in terms of the decision to proceed to trial, there is no evidence that the defendant or her insurer used their financial strength in an untoward manner. The plaintiff was successful at trial and is therefore entitled to costs of the action at Scale B, but not double costs.