If you are advancing and ICBC injury claim in BC Supreme Court, whether or not you are represented by an ICBC Claims Lawyer, you need to know something about Formal Settlement Offers. These settlement offers bring potential consequences if they are not accepted and these need to be considered when deciding whether an ICBC settlement offer is fair.
Rule 37 of the BC Supreme Court Rules permits parties to a lawsuit to make a Formal Settlement Offer and if the claim goes to trial and the settlement offer is beaten there can be significant Costs consequences (where the losing side has to pay the winning side tarriff court costs and disbursements which can easily exceed $10,000).
If you think of taking an ICBC claim to trial and winning I imagine you think of proving the other driver is at fault and being awarded money for your injuries. With formal settlement offers, winning is not quite that simple. If ICBC makes a formal settlement offer under Rule 37 and the judge or jury awards you less this can be considered a loss. Rule 37(24) sets out the consequences to a Plaintiff for failing to accept a Defendant offer to settle and ‘losing’ at trial, the subrule reads as follows:
Consequences of failure to accept defendant’s offer for monetary relief
(24) If the defendant has made an offer to settle a claim for money and the offer has not expired or been withdrawn or been accepted,
(a) if the plaintiff obtains judgment for the amount of money specified in the offer or a lesser amount, the plaintiff is entitled to costs assessed to the date the offer was delivered and the defendant is entitled to costs assessed from that date, or
(b) if the plaintiff’s claim is dismissed, the defendant is entitled to costs assessed to the date the offer was delivered and to double costs assessed from that date.
On the other side of the coin, there can be more than one way of winning. If you make a formal offer to settle your ICBC claim in compliance with Rule 37 and the judge or jury award you more money, Rule 37(23) sets out the consequences to the Defendant. The subrule reads as follows:
Consequences of failure to accept plaintiff’s offer to settle a monetary claim
(23) If the plaintiff has made an offer to settle a claim for money, and it has not expired or been withdrawn or been accepted, and if the plaintiff obtains a judgment for the amount of money specified in the offer or a greater amount, the plaintiff is entitled to costs assessed to the date the offer was delivered and to double costs assessed from that date.
Now, after absorbing all of the above you need to know that RULE 37 and 37A are being repealed as of July 2, 2008 and being replaced with Rule 37(B)!
That does not mean that you just wasted your time learning the above. If a formal offer to settle an ICBC injury claim is made before July 2, 2008 it needs to comply with Rule 37 or Rule 37A to trigger ‘costs consequences’.
To trigger costs consequences in an ICBC claim that goes to trial any offer made after July 2, 2008 has to comply with Rule 37B. To do so the offer must
1. be made in writing
2. be delivered to all parties of record, and
3. contain the following sentence “the [name of party making the offer] reserves the right to bring this offer to the attention of the court for consideration in relation to costs after the court has rendered judgement on all other issues in this proceeding”.
It seems that the purpose of Rule 37B) is to simplify the process of making formal settlement offers. The consequences of taking ICBC claims to court and beating (or not beating) a formal settlement offer seem to be less certain under this new rule. Rule 37B(4) sets out the consequences as follows: “The court may consider an offer to settle when exercising the court’s discretion in relation to costs”.
The options given to the court are set out in subrule 5 which states:
In a proceeding in which an offer to settle has been made, the court may do one or both of the following:
(a) deprive a party, in whole or in part, of costs to which the party would otherwise be entitled in respect of the steps taken in the proceeding after the date of the delivery of the offer to settle;
(b) award double costs of all or some of the steps taken in the proceeding after the date of the delivery of the offer to settle.
Subrule 6 sets out the factors a court may consider in exercising its costs discretion where a formal offer was made stating:
In making an order under subrule (5), the court may consider the following:
(a) whether the offer to settle was one that ought reasonably to have been accepted, either on the date that the offer to settle was delivered or on an later date
(b) the relationship between the terms of the settlement offered and the final judgment of the court;
(c) the relative financial circumstances of the parties;
(d) any other factor the court considers appropriate
I for one welcome Rule 37B. One of the biggest criticisms made by plaintiff ICBC injury claims lawyers was that the old Rule 37 was unfair to plaintiffs as a person injured in a car accident was always in a worse financial position to face the consequences of losing at trial than ICBC. This lopsided reality created a lot of pressure on people advancing ICBC injury claims in BC Supreme Court to consider settlement when faced with a Rule 37 formal settlement offer.
It will be interesting to see if our BC courts, when considering “the relative financial circumstances of the parties” will consider ICBC a party to the lawsuit of an ICBC injury claim. Typically, ICBC is not named as a defendant to a ICBC Injury tort Claim, instead those at fault for the collision are named and often they simply happen to be insured by ICBC. So ICBC is not formally a ‘party’ to most ICBC injury tort claims.
If the court is willing to consider the fact that the Defendant is insured when weighing the ‘relative financial circumstances of the parties‘ then this Rule is a welcome change for anyone advancing an ICBC injury claim. If not, perhaps the court is willing to consider this under “any other factor the court considers appropriate“.
Do you have questions about an ICBC settlement offer or the Rules of Court governing settlement offers in BC Supreme Court? If so click here to arrange a free consultation with ICBC Injury Claims lawyer Erik Magraken.