Double Costs Application Allowed To Proceed Despite Entered Order Addressing Costs
In interesting reasons for judgement released today by the BC Supreme Court, Chilliwack Registry, Chief Justice Hinkson determined that a double costs application could proceed despite the entry of an order addressing costs.
In today’s case (Keller v. Pearson) the Plaintiff was injured in a collision and sued for damages. Prior to trial ICBC offered to settle the case for $70,000. The Plaintiff rejected the offer and proceeded to trial where the case was dismissed with costs payable to the Defendant. The Court did not address the consequences of the formal offer. An order was entered which read “The Plaintiff shall pay the Defendants’ costs in this action, subject to the Plaintiff being at liberty to request to reappear before the Court to make submissions in respect of same.”.
The Defendant then sought double costs relying on their pre trial formal offer. The Plaintiff argued the Court was functus officio. Mr. Justice Hinkson disagreed and provided the following reasons addressing the narrow exception to address costs following an entered order:
[10] The plaintiff contends that it is he, and he alone, who was permitted by the entered order to reappear before the Court to make submissions as to costs, and that the defendants have no basis upon which to advance any submissions with respect to double costs.
[11] While it may have been open to the defendants to make submissions seeking double costs before the entry of the order, the order addresses their entitlement to costs, subject only to the plaintiff’s request to reappear before the Court. No such request has been made by the plaintiff, and the defendants’ entitlement to costs in the matter has been determined by the summary trial judge.
[12] In Buschau v. Rogers Communications Inc., 2004 BCCA 142 at paras. 26–27, 237 D.L.R. (4th) 260, Newbury J.A. stated:
[26] …The Court also had the power to amend the entered order on the basis that it contained an error in expressing the manifest intention of the Court. As stated by Rinfret J. for the Supreme Court of Canada in Paper Machinery, [[1934] S.C.R. 186]:
The question really is therefore whether there is power in the Court to amend a judgment which has been drawn up and entered. In such a case, the rule followed in England is, we think — and we see no reason why it should not also be the rule followed by this Court — that there is no power to amend a judgment which has been drawn up and entered, except in two cases: (1) Where there has been a slip in drawing it up, or (2) Where there has been error in expressing the manifest intention of the court (In re Swire [(1885) 30 Ch. D. 239]; Preston Banking Company v. Allsup & Sons, [[1895] 1 Ch. 141]; Ainsworth v. Wilding, [[1896] 1 Ch. 673]). [at 188; emphasis added.]
Paper Machinery has been cited on numerous occasions by Canadian courts, including this court in R. v. Blaker (1983), 46 B.C.L.R. 344, at 347, and in Racz v. District of Mission (1988) 22 B.C.L.R. (2d) 70. In the latter case, the Court set aside a “consent dismissal order” entered by a solicitor who had acted without authority. The Court found that it had inherent jurisdiction to correct what would otherwise be an abuse of process and ruled that it was not necessary to require the plaintiff to bring a fresh action in order to set the order aside. On this point, the Court agreed with Chief Justice Sinclair in Morstad v. Quintal (1980) 14 Alta. L.R. (2d) 369 (Q.B.), who had said that [at p. 371]:
… it must surely be within the inherent jurisdiction of this court to grant the relief sought by the plaintiff on the present motion without the necessity of going through the sterile routine of commencing a separate action, a proceeding which would not result in the bringing forth of additional facts or otherwise advancing the administration of justice.
Hutcheon J.A. in Racz noted that in Morstad, the order nisi as entered had been “based on a mutual mistake of fact.” (At 73.)
[27] Even if the error in the order was not a “clerical” one or an error arising from an “accidental slip or omission” within the meaning of Rule 41(24), then, the court below had the inherent jurisdiction to correct the order insofar as it did not reflect its manifest intention. In the absence of any evidence that the respondents had taken any irrevocable step in reliance on the order, or would suffer undue prejudice were it corrected, I conclude that the Court should have exercised this jurisdiction and corrected its order. In my view, it cannot be in the interests of justice for the respondents to rely on that order to retain a sum to which they have no entitlement in principle.
[13] I am unable to see that either of the two exceptions discussed in Paper Machinery apply in this case. I am advised that the entered order was drafted by counsel for the defendants. There is no suggestion that there was any “slip” in drawing it up, nor does it evidence any error in expressing the manifest intention of the court. There is no suggestion before me that Smart J. was asked to order double costs, and there is no basis upon which it could be argued that he intended to do so.
[14] Nor is this a situation such as that dealt with by Mr. Justice Burnyeat in GC Parking Ltd. v. New West Ventures Ltd. et al, 2004 BCSC 1700, 9 C.P.C. (6th) 245, where after an order awarding costs on Scale 3 against the defendants was made, the order entered made no reference to costs as the plaintiff specifically advised the defendants that it intended to make further submissions respecting an alleged entitlement to double costs. In that circumstance, Burnyeat J. held at para. 17 that:
[17] The court can be functus officio where the entered order accurately deals with matters which were dealt with in the Reasons for Judgment but retain jurisdiction to deal with matters which were not set out in the entered order but which were dealt with in the Reasons for Judgment. Bavelas v. Copley, [2000] B.C.J. (Q.L.) No. 523 (B.C.S.C.) dealt with an order entered with respect to liability and damages but not with respect to costs. Drost J. held that the entry of the order rendered the court functus offico “except with respect to the issue of costs” (at para. 20).
[15] While I respectfully agree with this statement by Burnyeat J., in the case before me, the entered order reflected the disposition of costs as set out in the reasons for judgment.
[16] However, in Smart v. McCall Pontiac Buick Ltd., 2001 BCSC 467, [2001] B.C.J. No. 682, special costs were awarded to the plaintiff in a written judgment, and an order was entered providing for special costs. An application was then brought by the plaintiff for double costs based upon an offer to settle made by the plaintiff. Mr. Justice McKinnon reasoned that despite the entered order, he could hear the plaintiff’s application for double costs arising from the defendants’ failure to take advantage of an offer, which was substantially below the amount awarded, as he was unaware of the offer to settle and unentitled to know about it when delivering his reasons for judgment.
[17] I am unable to distinguish the factual underpinnings in Smart from those in this case. Despite the entry of the order in this case, based upon the principle of judicial comity discussed in Re Spruce Hansard Mills Ltd., [1954] 4 D.L.R. 590, 34 C.B.R. 202, I find that I am obliged to hear the defendants’ application for double costs.