More on the New Rules, Formal Settlement Offers and Timelines for Acceptance


As I’ve previously written, the new formal settlement offer rule (Rule 9) reads almost identically to the former Rule 37B.   Under the former rules BC Courts were reluctant to have formal settlement offers trigger costs consequences following trial where the offer was open for acceptance for a short period of time.  Reasons for judgment were released today by the BC Supreme Court, Vancouver Registry, reaching a similar result under Rule 9.
In today’s case (Hunter v. Anderson) the Plaintiff sued for injuries as a result of a slip and fall incident.  In the course of the lawsuit the Defendant made a formal settlement offer for $25,000.  This offer was made one week before trial and was left open for acceptance for only 3 days.  The Plaintiff declined the offer and proceeded to trial.  After trial the Defendant was found 25% at fault for the fall and the Plaintiff was awarded just over $9,000 in damages.
The Defendant asked to be awarded their costs from the time of the offer onward.  Mr. Justice Cullen refused to do so finding that the offer was not alive for a reasonable period of time and split the costs the parties were entitled to.   In reaching this verdict the Court provided the following reasons:
[14] In dealing with the first issue under Rule 9-1(6), whether the offer was one that might reasonably have been accepted “the analysis is not one of hindsight, once the final result is known”.  See A.E. v. D.W.J. 2009 BCSC 505; Bailey v. Jang, 2008 BCSC 1372.  In the present case, the operative offer of the defendant was made relatively late in the day and was essentially premised on the defendant having no potential liability, but simply to offset the costs of a potential trial…

[15]         In my view, on balance, in the circumstances, despite the ultimate result, given the short duration of the offer, the fact that it was not based on an assessment of the liability of the defendant, it could not be characterized as one which ought reasonably to have been accepted.  I note that on March 9, 2010, when the offer was made, the defendant had not yet provided her fourth and final list of documents which was provided on March 10th.  As well, there was ongoing disclosure of the plaintiff’s documents.

[16]         In addition I note that in Bailey v. Jang, supra, Hinkson J. (as he then was) considered a seven day period “a reasonable time after which the plaintiff could consider (the defendant’s) offer” for purposes of awarding double costs under the old Rule 37B(6) after the expiry of that period…

Although the defendant tendered her offer on March 9th, six days before trial, it was in the context of ongoing disclosure and was left open, effectively, for only three days.  The plaintiff did not have the benefit of a great deal of time to assess the defendant’s offer.  In the context of Bailey v. Jang, Hinkson J. considered a seven day period “a reasonable period of time after which the plaintiff could consider their offer”.  I conclude a similar period is appropriate to impute in the circumstances of this case where the plaintiff was deprived of the ability to accept the defendant’s offer after only three days effectively commencing March 10th.  In light of that factor and the others I have set forth, I award the plaintiff, as indicated, the costs and disbursements up to and including the first two days of trial, and the defendants their costs and disbursements for the six days comprising the balance of the trial.

bc injury law, formal settlement offers, Hunter v. Andeson, Mr. Justice Cullen, Rule 9, Rule 9-1(6)

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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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