UPDATE January 28, 2014 – the BC Court of Appeal overturned the below result in reasons for judgement released today
In an interesting demonstration of the BC Supreme Court’s discretion relating to costs awards following trials where formal settlement offers were made, reasons for judgement were released this week by the BC Supreme Court, Vancouver Registry, refusing to award ICBC costs where a Jury’s damages amounted to less than 10% of ICBC’s best formal settlement offer.
In the recent case (Paskall v. Scheithauer) the Plaintiff was injured in a 2005 motor vehicle collision. Fault and damages were at issue. Prior to trial ICBC tabled a $700,000 formal settlement offer. The Plaintiff proceeded to trial and sought damages of over $2 million. After a liability split of 80/20 in the Plaintiff’s favour the damages awarded by the jury came to just over $65,000.
Having enjoyed substantial financial victory as compared to their pre-trial offer, ICBC sought post offer costs and disbursements arguing their offer ‘ought to have been accepted’. Mr. Justice Smith disagreed finding, interestingly, that the the Defendant’s failure obtain medico-legal reports despite having the Plaintiff attend two independent medico-legal assessments created an evidentiary vacuum making it impossible for the Plaintiff to conclude that the formal offer was one that reasonably ought to have been accepted. In dismissing ICBC’s sought costs the Court provided the following reasons:
 In order to determine whether an offer is reasonable and ought to be accepted, the plaintiff must be able to consider it in relation to the evidence expected at trial and the apparent range of possible outcomes. In a personal injury case, that exercise usually includes consideration of conflicting medical opinions, along with the possibility and likely consequences of the court preferring certain opinions over others. Plaintiff’s counsel who is relying on an opinion from Dr. X can advise his or her client of the reduction in damages that may result from the court rejecting the evidence of Dr. X and accepting the opinion of Dr. Y that is being relied on by the defendant.
 In this case, the evidence relied on by the plaintiff included opinions of a neuroradiologist, a neuropsychologist, a psychiatrist, an otolaryngologist and two physiatrists. The only experts put forward by the defendant on the question of damages were the occupational therapist dealing with cost of future care and the economist. The defendant served no medical expert opinions, although the plaintiff had attended two independent medical examinations at the request of defence counsel.
 The onus of proof at trial is on the plaintiff. The defendant is under no obligation to produce medical evidence and may rely entirely on cross-examination of the plaintiff and the plaintiff’s medical experts to support an argument that the plaintiff has failed to prove damages. That is what defence counsel chose to do in this case, apparently with great success.
 But the onus of proof at trial is not necessarily relevant to the question of whether an offer made before trial “had some relationship to the claim” or “could be easily evaluated”. In choosing to defend this case in the way he did, the defendant also chose not to provide the plaintiff with evidence on which she could judge the reasonableness of the offers to settle. With the plaintiff’s medical reports in hand, and in the absence of contrary medical opinions, I do not see how reasonable counsel could have recommended acceptance of either of the defendant’s offers or justified such a recommendation to the plaintiff.
 A second factor for consideration set out in R. 9-1(6) is the relationship between the offer and the final judgment. However, the court cautioned against putting too much weight on this factor in cases involving jury trials, given the unpredictability of jury awards: Smagh v Bumbrah, 2009 BCSC 623 at paras 13-14.
 In this case, I find the consideration under R. 9-1(6)(a) to be determinative. I am not only unable to say the offers ought reasonably to have been accepted, but I find that they could not reasonably have been accepted in the context of the evidentiary vacuum in which they were presented. I conclude the plaintiff is entitled to her costs as if the offers had not been made.