Tag: bc personal injury law

Can Interest on Disbursements be Recovered in BC Injury Litigation?


As I’ve written before, personal injury litigation can be an expensive business.
It usually costs thousands of dollars if not tens of thousands of dollars to bring an injury claim to trial in the BC Supreme Court.  I’m not talking about lawyers fees here either.  What I’m referring to is the cost of gathering evidence for presentation in court.  To succeed in Court usually expert opinion evidence is required to address many areas that frequently come up in injury litigation such as diagnosis of injury, prognosis, disability etc.   Expert medical reports usually cost anywhere from hundreds to tens of thousands of dollars.
These significant disbursements are often funded by personal injury lawyers or on a line of credit.  When a Plaintiff is successful in their personal injury claim they can recover their reasonable disbursements from the opposing party.  But can the interest on these disbursements be recovered?  Reasons for judgement were released today by the BC Supreme Court, Vancouver Registry addressing this topic.
In today’s case (Milne v. Clarke) the Plaintiff was injured in a 2005 BC Car crash.  In advancing his claim private MRI’s were arranged between 2005-2006.  These cost $975 a piece.
The claim settled in 2009 for $170,000 plus costs.  By the time of settlement the costs of the MRI’s with interest came to almost $4,000.  The Plaintiff sought this amount from the Defence and the Defence refused to pay.
Ultimately the matter went before a Master of the BC Supreme Court who held that the interest was not recoverable.  The Plaintiff appealed.  Mr. Justice Burnyeat reversed the Master’s ruling finding that interest on disbursements can be recoverable.  Specifically the Court reasoned as follows:

[4] In support of the submission that the Learned Registrar erred in principle, Mr. Milne submits that the law which was binding on the Learned Registrar is set out in McCreight v. Currie, [2008] B.C.J. No. 2494, where ….  In allowing the interest, Registrar Young concluded:

… The plaintiff really had no choice but to pay the interest given that she did not have the funds to be retaining experts and paying for their reports up front.  I suppose the defendant’s choice was that the defendant could have offered to pay for the report up front once it was disclosed to him, but no offer was forthcoming.  Given this was the only way to finance the obtaining of a report, I find this to be a reasonable expense and I will allow it.

[6] Rule 57(4) of the Supreme Court Rules provides that, in addition to determining fees, the Registrar must:

(a)   determine which expenses and disbursements have been necessarily or properly incurred in the conduct of the proceeding, and

(b)   allow a reasonable amount for those expenses and disbursements.

[7] In support of the application, it is said that Mr. Milne had no means of paying for the required M.R.I. scans other than to borrow money from the provider and that, since the cost of the M.R.I. had already been agreed upon, so too should the interest on the unpaid accounts rendered by the provider of the M.R.I. images.  Here, it is the provider of the M.R.I. and not counsel for Mr. Milne who is charging the interest on the invoices.

[8] I find that the Learned Registrar erred in principle.  The December 29, 2009 decision was clearly wrong.  First, even if the Learned Registrar was not bound by the decision inMcCreight, I am not bound by the decision reached by the Learned Registrar herein.  I am satisfied that the statement set out in McCreight accurately represents the law in British Columbia.  Second, the decision in Hudniuk relates to the question of whether disbursement interest is a head of damage and not to the question of whether it is recoverable as costs on an assessment.

[9] The law in British Columbia is that interest charged by a provider of services where the disbursement has been paid by counsel for a party is recoverable as is the disbursement.  The interest charge flows from the necessity of the litigation.  If the disbursement itself can be assessed as an appropriate disbursement, so also can the interest owing as a result of the failure or inability of a party to pay for the service provided.  In order to obtain the M.R.I., it was necessary to pay not only the $975.00 cost but also the interest on any unpaid balances that were not paid immediately.  The cost plus interest was the cost of obtaining the M.R.I.  The claim for interest should have been allowed.

This judgement is a welcome development for people advancing personal injury claims in BC as the Court’s reasoning provides greater certainty that successful Plaintiffs can recover interest charged on reasonable disbursements incurred in the course of litigation.

Please My Lady, Overturn that Award! One of BC's Largest Personal Injury Jury Awards Discussed


Late last year a Vancouver Jury handed out one of the biggest Personal Injury awards in British Columbia’s history.  In that case (Ciolli v. Galley) the Plaintiff was injured in three seperate motor vehicle accidents.  The trial for all of her claims were heard together and a Jury initally awarded some $12 million in compensation.
The award included $6.5 million for non-pecuniary damages (money for pain and suffering and loss of enjoyment of life).  Such an award is not allowed in Canada as a result of a series of cases known as “the trilogy”.  In the trilogy the Supreme Court of Canada found that the maximum a victim can be awarded for non-pecuniary damages in a negligence claim is $100,000.  Adjusted for inflation this cap is now close to $327,000.  After being advised of this fact the Jury reduced their award of non-pecuniary damages to this maximum amount bringing the total judgement to some $6.2 million.
The Defendants, undoubtedly surprised by the award, asked the trial judge to disregard the Jury’s award arguing that the damages awarded were “exceptional” and mandated “judicial intervention“.  The Defendants asked that a mistrial be ordered .
Madam Justice Loo dismissed the mistrial application finding she had no jurisdiction to overturn the award.   In reaching this conclusion Madam Justice Loo made the following observations:
Only in limited circumstances may a trial judge refuse to accept a jury’s verdict; when he or she concludes “that there is no evidence to support the findings of the jury; or where the jury gives an answer to a question which cannot, in law, provide a foundation for judgment”…
In my respectful view, the defendants are really complaining that the jury’s award is inordinately high or wholly out of proportion to the evidence and cannot be reasonably supported by the evidence. That may be, but unless there is no evidence to support the jury’s findings, a trial judge may not reject a jury’s verdict. I cannot conclude that there was no evidence before the jury relating to Ms. Ciolli’s claim for pecuniary loss, and accordingly, the application is dismissed.
This case is heading off to the BC Court of Appeal and I’ll be sure to report the BC High Court’s comments on this case once they have an opportunity to release their reasons for judgement.

More on ICBC Tort Claims and Pre-Existing Injuries

How is a claim for compensation affected if you suffer from pre-existing injuries and as a result of the fault of another have your injuries aggravated?  If your injuries would have deteriorated eventually without the intervening event your claim for damages can be adjusted accordingly.  This is sometimes referred to as the ‘crumbling skull’ principle and reasons for judgment were released today by the BC Supreme Court, New Westminster Registry, applying this point of law.
In today’s case (Jopling v. Bradowich) the Plaintiff was injured in a 2004 BC Car Crash.  The Plaintiff’s accident related injuries included headaches, disturbed sleep, depression and chronic pain.  However, the Plaintiff suffered from pre-existing problems which were summarized by Mr. Justice Rice as follows: “ I am satisfied that the plaintiff suffered from pre-existing injuries to her lower back prior to the motor vehicle accident, and that there was a general degeneration of her spine, all of which were likely to lead her to the condition that she now experiences, although probably not as soon as it did because of the accident.”
The Court valued the Plaintiff’s non-pecuniary loss (pain and suffering) at $75,000 but then reduced this award by 20% to ‘reflect the contingencies that her back and shoulder pain would have manifested regardless of the accident‘.
In reaching this conclusion Mr. Justice Rice made the following observations of the law of causation in BC personal injury claims:

29] The principal issue in this action is whether the plaintiff’s individual injuries were caused by the accident, or whether they were only aggravations of pre-existing injuries.

[30] Proof of causation is determined by the “but for” test: Athey v. Leonati, [1996] 3 S.C.R. 458, at para. 14; Hanke v. Resurfice, 2007 SCC 7, [2007] 1 S.C.R. 333, at para. 21). If I find that “but for” the defendant’s conduct the plaintiff would not have been injured, then the defendant is liable for all the damages flowing from those injuries.  If the conduct of the defendant is unrelated to the alleged loss, then the defendant is not liable.

[31] It is no answer to a plaintiff’s claim for damages that he or she would have suffered less injury or no injury at all had he or she been less susceptible.  If an individual has a pre-existing condition, the person who injures that individual must take him or her as found: Athey, at para. 34.

[32] However, if the plaintiff’s injuries would have manifested themselves on their own in the future regardless of the defendant’s conduct, the court must apply a contingency factor to address that possibility.  Such a contingency does not have to be proven to a certainty.  Rather, it should be given weight according to its relative likelihood: Athey, at para. 35.

Personal Injury Claims, Settlement Agreements and Repudiation

When offers are made for the settlement of ICBC or other BC personal injury claims the parties involved must take care not to ‘demonstrate an unwillingness to be bound by the agreement’ otherwise they risk the settlement agreement being repudiated.  Reasons for judgement were released today illustrating this principle.
A bit of background is necessary before getting into the facts of this case.  Typically in BC Personal Injury Cases from car accidents ICBC insures both the Plaintiff and the Defendant.  This is so because ICBC is a statutory insurer with certain monopoly privileges so they insure almost all vehicles in British Columbia.  In some circumstances, of course, other insurance companies are involved (for example when the offending party is an out of Province motorist).
In today’s case the Plaintiff was insured with ICBC for ‘no-fault benefits’ (also known as Part 7 benefits) and the operator of the offending vehicle was insured with Progressive.  The Plaintiff ran into problems with both companies and started a lawsuit against ICBC for no-fault benefits which were allegedly outstanding and also made a tort claim against the motorist insured with Progressive.
The tort case apparently settled for “79,605.50 plus costs of no more than $19,767.13″.  The parties then apparently settled the costs amount with Defence Counsel writing to Plaintiff’s counsel stating
I have instructions to accept your offer to settle the costs.  The adjuster will be forwarding to your office a cheque in the sum of $97,936.70 Cdn to cover the settlement including costs.  The funds will be sent on your undertaking not to release any part of them to the plaintiff until the Release and Consent Dismissal Order that I plan to fax to you today are fully executed, and on your further undertaking to return the executed documents to me as soon as reasonably possible
A few days later counsel for the Plaintiff responded stating that the Plaintiff “was not prepared to execute the release because it referred to a “Part VII action”.  It stated that the defendant was released from all claims:”
The parties tried to resolve their differences but could not.   The Plaintiff brought an application for an order to enforce the settlement agreement that was allegedly reached.  Mr. Justice Williamson refused to do so finding that the Plaintiff had repudiated any settlement agreement that may have been reached.  The courts key reasoning is set out at paragraphs 14 – 20 of the judgement which I reproduce below:

[14]            The plaintiff relies upon Cellular Rental Systems Inc. v. Bell Mobility Cellular Inc., [1995] O.J. No. 721 (Ct. J. (Gen. Div.)). At para. 24 of that decision, Chapnik J. stated:

It is well established that settlement implies a promise to furnish a release unless there is agreement to the contrary.  On the other hand, no party is bound to execute a complex or unusual form of release: although implicit in the settlement, the terms of the release must reflect the agreement reached by the parties.  This principle accords with commons sense and normal business practice.

[15]            And further, at para. 36, the learned judge stated:

The onus is on the party claiming repudiation to show that the disagreement consequent upon the settlement constitutes a repudiation of it.  Subsequent disputes should be resolved by application to the court or by common sense within the framework of the settlement to which the parties have agreed and in accordance with the common practices which prevail amongst members of the bar.  It will be rare for conduct subsequent to a settlement agreement to amount to repudiation.

[16]            In so stating, Chapnik J. referred to a decision of McEachern C.J.B.C. in Fieguth v. Acklands Ltd. (1989), 59 D.L.R. (4th) 114, 37 B.C.L.R. (2d) 62 (C.A.).  In Fieguth, the Chief Justice noted that once there has been an agreement, one party can tender whatever documents thought appropriate to complete the agreement without actually rescinding the settlement.  At page 121, the Chief Justice stated:

If such documents are accepted and executed and returned then the contract, which has been executory, becomes executed.  If the documents are not accepted then there must be further discussion but neither is released or discharged unless the other party has demonstrated an unwillingness to be bound by the agreement by insisting upon terms or conditions which have not been agreed upon or are not reasonably implied in these circumstances.

[17]            Here, the release documents were not accepted.  There was further discussion.  The question is, in the words of McEachern C.J.B.C. as stated above, has one party demonstrated an unwillingness to be bound by the agreement by insisting upon terms or conditions which have not been agreed upon or are not reasonably implied?

[18]            I conclude that is the circumstance here.  The parties appear to have agreed to settle the matter for $97,936.70 Cdn.  However, when the necessary documents, in particular the release, was forwarded to counsel for the plaintiff, the plaintiff declined to execute the release unless something was done about the plaintiff’s right to continue with the other action against ICBC. 

[19]            I have referred to the December 1, 2008, email from counsel for the plaintiff to counsel for the defendant.  In my view, the wording of it is clear.  It states “my client will sign a full release once she has been compensated for Part 7’s in the sum of $7,000”.  In other words, the plaintiff took the position that she would not complete the November 19 agreement unless she was paid an additional $7,000 or, presumably, the defendant agreed that she could continue her action against ICBC.  I conclude that to take such a position is to repudiate the agreement allegedly reached on November 19. 

[20]            In the circumstances, the plaintiff’s application is dismissed.  The defendant will have its costs.

Contact

If you would like further information or require assistance, please get in touch.

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.

“Work hard, be kind and enjoy the ride!”
Erik’s Philosophy

Disclaimer