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.