Reasons for judgement were published today by the BC Supreme Court, Vernon Registry, confirming that an order for double costs does not also mean a party is entitled to double disbursements.
In today’s case (Lafond v. Mandair) the Plaintiff was injured in a collision and sued for damages. Prior to trial the Plaintiff made a formal settlement offer of $300,000. At trial the Plaintiff beat this quantum being awarded just over $343,000.
The Plaintiff sought double costs and disbursements. The Defendant agreed double costs were in order but argued that double disbursements were not recoverable. The Court agreed and in doing so provided the following succinct reasons:
 Double costs may be awarded for some or all steps taken after delivery of the offer to settle. A step in the proceeding is a formal step that moves the action forward: Canadian National Railway Company v. Chiu, 2014 BCSC 75 at para. 7.
 Incurring a disbursement is not a formal step as contemplated by the Civil Rules.
 I, therefore, conclude that under Rule 9-1(5)(b), double disbursements are not to be awarded as part of double costs. Thus, a successful offer to settle can be rewarded with an entitlement to double costs for tariff items, together with actual and reasonable disbursements.
Reasons for judgement were released last week by the BC Supreme Court, Vancouver Registry, awarding a Plaintiff double costs after obtaining judgement nearly doubling her pre trial formal settlement offer.
In the recent case (Risling v. Riches-Glazema) the Plaintiff was inured in a motor vehicle collision and prior to trial made a formal settlement offer of $315,000. The Defendants rejected the offer and proceeded to trial where damages of $622,500 were awarded. The Plaintiff sought and was granted post offer double costs. In agreeing these were warranted Mr. Justice Affleck provided the following reasons:
 In my view:
a) The plaintiff’s case was well known to the defendants at the time of the offer. The plaintiff had been examined for discovery on two occasions; had attended two medical examinations at the request of the defendants, and a mediation had taken place in June 2016;
b) the offer was made one week before the trial began which gave the defendants a full opportunity to consider it;
c) the offer had a relationship to the claim and could not be characterized as a “nuisance offer”; and
d) the offer was expressed in plain language and thus easily evaluated.
 The final judgment of the court greatly exceeded the offer. The plaintiff submits her offer was a true attempt to reach a reasonable compromise of the claim and that the rationale for the double cost rule is to encourage parties to settle by taking a realistic view of the probable outcome of a trial. The plaintiff submits that rationale would be thwarted if in the present circumstances she is not entitled to double costs.
 The defendants submit their limited understanding of the case made it difficult to quantify the claim and that, while the rationale for the rule for double costs is acknowledged, the defendants ought not to have been deterred from defending the claim for fear of a “punishing costs award”. Currie v. McKinnon, 2012 BCSC 1165 is relied on in support of that argument.
 The defendants also submit that “no rationale for the offer was provided” in the plaintiff’s letter of August 15, 2016.
 I do not agree that no rationale was provided. The plaintiff described the heads of damages she would advance at the trial and advised that the offer took into account “Part 7 Benefits paid or payable pursuant to Section 83 of the Insurance (Vehicle) Act”. Furthermore, the defendants had an opportunity on the mediation to canvas fully with the plaintiff’s legal advisers the extent of the plaintiff’s claim and the evidence at trial which would be advanced to support the claim.
 I am also mindful that in Hartshorne the Court of Appeal expressed the view that the list of factors described in para. 27 of its reasons need not be relevant in every case.
 Currie v. McKinnon does not help the defendants on this application. That case involved a personal injury claim with an award of damages which fell within the monetary jurisdiction of the Small Claims Court. Double costs were not awarded. In short Currie v. McKinnon is distinguishable on its facts from the matter before me to such an extent that it cannot usefully be called in aid of the defendants’ argument.
 The plaintiff is entitled to the costs of this action including double costs from the date of the offer.
Reasons for judgement were released today by the BC Supreme Court, New Westminster Registry, rejecting a request for double costs following a trial where a Plaintiff beat her formal settlement offer by a slim margin.
In today’s case (Griffith v. Larsen) the Plaintiff suffered an injury in a collision. Prior to trial the plaintiff provided a formal settlement offer of $85,000 which was rejected. At trial she was awarded $85,159. The Plaintiff asked for double costs but Mr. Justice Affleck refused to award these finding it would not be appropriate in the face of credibility concerns and further with the Defendant enjoying some success at trial on one of the most contentious issues. In rejecting the request for double costs the Court provided the following reasons:
 I have considered two factors which have influenced my decision against awarding double costs. The first is my findings of credibility which were not favourable to the plaintiff. While I concluded the plaintiff had suffered soft tissue injuries of some duration which were deserving of an award of damages, I also concluded that she had not given her evidence with candour. An award of double costs is meant in part to penalize a party for failing to accept a reasonable offer. On the other hand a party who has not been candid with the court at least in some instances ought not to be rewarded with double costs even if her damage award exceeds the offer. This is one of those instances.
 The second factor I have considered is the defendants’ relative success on the most contentious issue at the trial. The plaintiff advanced a claim far exceeding the award which was largely predicated on the proposition she would need surgery to overcome a disabling thoracic outlet syndrome. I did not accept the plaintiff’s evidence on that issue. The defendants largely succeeded in persuading me that the thoracic outlet syndrome, if the plaintiff actually experienced it, had little effect on her physical condition. That is a further reason for concluding it is not appropriate to penalize the defendants with an award of double costs.
 In Mudry v. Minhas, 2010 BCSC 1110, Kelleher J. discussed apportionment of an award of costs for relative success on an issue under the then Rule 57(15). While the court concluded the plaintiff had not met the test for apportionment, the plaintiff’s success in that case on the issue of fault (although no damage was found and the action dismissed) was a relevant factor under Rule 37B(6)(d), now Rule 9-1(5)(b), on considering if the defendant was entitled to double costs when there had been a defence offer, which in Mudry obviously exceeded the damage award which was nil..
 I acknowledge there is some merit to the plaintiff’s submission that, notwithstanding the absence of success on the issue of thoracic outlet syndrome, the plaintiff’s offer took into account the risk of failure on that issue. Nevertheless, in the circumstances of this action I am unwilling to penalize the defendants in costs when they largely succeeded on that question. The usual rule will prevail that party and party costs on Scale B follow the event.
In an illustration that not all trial ‘losses’ trigger catastrophic costs consequences, reasons for judgement were released today by the BC Supreme Court, New Westminster Registry, ordering balanced costs consequences.
In this week’s case (Desharnais v. Parkhurst) the Plaintiff was involved in two vehicle collisions. Prior to trial the Defendants provided two formal offers, the first at $50,000 the second at $75,000. The Plaintiff, who was seeking in excess of $1 million rejected both offers and proeeded to trial. Following a thirteen day jury trial the Plaintiff’s damages were ultimately assessed at $30,100.
Both parties had medical evidence to justify their respective positions, however, the Court noted, some of the opinions of the Plaintiff’s experts were “highly suspect”.
The Defendants sought substantial costs having bested their formal settlement offers. The Court noted a more appropriate result would be to award the Plaintiff costs up to the date of the second formal offer and to have the parties bear their own costs thereafter. While such an order still has significant financial consequences for the Plaintiff it is far less sever than ordering payment of the Defendant’s costs. In reaching this decision Mr.Justice Saunders provided the following reasons:  On the whole, I do not consider either the First or the Second Offer as having reflected, objectively speaking, a genuine attempt at compromise. I find them to hae been more reflective of what the Applicants could reasonably have hoped to achieve if all or substantially all of the issues were resolved in their favour. I am not dissuaded from taking this view by the fact that the jury awarded even a lesser amount; I do not think it is unfair to counsel or to the jury for me to say that the jury’s decision was considerably less than what reasonably prudent counsel would have regarded as a “win” for the defence. I cannot find that either offer ought reasonably to have been accepted by the plaintiff.  As Goepel J. stated in Ward, that is the beginning, not the end of the analysis. The most basic principle underpinning the Rules relating to costs is that costs of a proceeding are to be awarded to the successful party (R. 14-1(9)). This expectation is intended to promote sensible conduct throughout court proceeding; it exists notwithstanding the broad judicial discretion to depart from the principle, which is generously built into the Rules.  In this case, the jury found that the plaintiff had successfully proven some damage. But for the offers to settle, he would be entitled to his costs. Having regard to the factors set out in Rule 9-1(6), including giving some weight to the plaintiff’s financial circumstances, I do not find that the offers were so substantial that the Applicants ought to be entitled to any indemnification against their own costs. The plaintiff’s position was not completely lacking in merit. It was not frivolous. However, the fact that the settlement offers exceeded the judgment amount cannot be ignored. The Applicants were forced to incur the expense of a trial which they were willing to avoid by paying the plaintiff a not insubstantial sum, a sum which ended up being considerably greater than the damages the plaintiff was judged to be entitled to. It would be unfair to require the Applicants to indemnify the plaintiff for the costs of advancing a claim that was ultimately judged to be greatly overvalued.  I find that the plaintiff is entitled to his costs up to the date of delivery of the Second Offer. The parties will bear their own costs thereafter.
Earlier this year the BC Supreme Court dismissed a lawsuit following a fight between two adults at a Pee Wee baseball game. Prior to trial the Defendant made several fairly modest settlement offers, one of which was a formal offer giving the Court the discretion to award double costs. In finding it was unreasonable for the Plaintiff to reject the offer and proceed to trial Madam Justice Watchuk (Charland v. Cloverdale Minor Baseball Association) provided the following reasons ordering the Defendant to pay double costs:  Mr. Wheeler submits that the offers were offers which ought reasonably to have been accepted. There is now general agreement on the law that, “in determining whether the offer to settle ought reasonably have been accepted the court does not consider the final result… The reasonableness of a decision not to accept an offer must be assessed … [by] the circumstances existing when the offer was open to acceptance:” [Ward at para. 36].  The first offer of $3000, although not a formal offer under the Rules, was made on March 13, 2012. It canvassed the minor injuries set out in Mr. Charland’s records, and noted that there was not the required supporting letter to substantiate the amount of an offer which had been made by Mr. Charland.  On June 8, 2012, a formal offer to settle in the amount of $5000 was served on counsel for Mr. Charland. It was open until five minutes after the commencement of the trial.  Discoveries of Mr. Charland were held in late July 2012. On August 2, 2012, counsel for Mr. Wheeler wrote to plaintiff’s counsel expressing reasons why Mr. Charland’s case was problematic. Those reasons, the credibility of Mr. Charland and the nature and extent of his injuries, were later the subject of findings made at the trial which supported the position of Mr. Wheeler.  At that time, previous offers were retracted and a “nuisance offer” of $250 was formally made.  Mr. Wheeler submits that the fact that the final offer was reduced significantly following discoveries should have no effect on the determination of whether double costs are appropriate in this case. I agree.  It was incumbent on Mr. Charland to “make a careful assessment of the strength or lack thereof of [his] case at the commencement and throughout the course of the litigation” [Hartshorne at para. 25]. Mr. Charland had knowledge, particularly after his Discovery, of the evidentiary problems in his case. He chose to proceed to trial despite knowledge of those problems. In light of that knowledge at the time the $5000 offer was made, and in light of the heightened knowledge at the time the nominal offer of $250 was made, his decision not to accept the offers was not reasonable.  As in Riley, Mr. Charland ought reasonably to have anticipated that his claim would be dismissed at trial.  With regard to the other factors listed in Rule 9-1(6), the relationship between the terms of settlement offered and the final judgment of the court may be considered by the court. The second and final offers were more favourable to Mr. Charland than the decision of the court since his claim was dismissed with costs.  The court may also consider the relative financial circumstances of the parties. Little is known regarding this factor. It appears from the evidence that both parties have similar financial circumstances. Both have legal costs arising from the litigation.  There are no other factors raised by Mr. Wheeler and, in the absence of submissions from Mr. Charland, no other factors that the court considers appropriate to take into account.  On consideration of the factors set out in Rule 9-1(6), I conclude that Mr. Wheeler is entitled to double costs from the date of the first formal offer, June 8, 2012.
Update Auguaat 16, 2013 – In an interesting development, the below judgement was overturned by the Chambers Judge before entry of the costs order. You can find reasons here
Reasons for judgement were released last week by the BC Supreme Court, New Westminster Registry, ordering a plaintiff to pay double costs to a defendant following a personal injury trial which failed to best the Defendant’s pre trial formal settlement offer.
In last week’s case (Gulbrandsen v. Mohr) was injured in a collision. In the course of the lawsuit the Defendant offered to settle for $50,000. The Plaintiff rejected this offer and proceeded to trial where a less favorable result was reached with damages being assessed at just over $28,000.
In the course of the trial the Court made negative findings about the Plaintiff’s reliability. In stripping the Plaintiff of her post offer costs and ordering that the Plaintiff pay double costs to the Defendant Mr. Justice Affleck provided the following reasons;  In exercising that discretion there are three possible approaches I have considered. The first would be to award costs to the plaintiff up to the date of the offer and deprive her of costs thereafter. In my view that outcome cannot be justified. It would largely ignore the intent of the rules to provide for an award of costs in favour of a party who has made an offer which ought to have been accepted but was not. The second alternative would be to award the plaintiff costs up to the date of the offer and the defendant single costs thereafter. I would be inclined to make that award if the award of damages had fallen only slightly short of the offer. It did not.  The remaining possible outcome I have considered is to award the plaintiff costs to the date of the offer and to award the defendant double costs thereafter, as he proposes. The factor which might militate against doing so is the relative financial circumstances of the parties. The plaintiff is a woman of modest means. I know nothing of the remaining defendant, Mr. Mohr’s, means. The action was defended by counsel instructed by ICBC. The court may take into account the presence of insurance coverage when assessing the relative financial circumstances of the parties: Smith v. Tedford, 2010 BCCA 302 at para. 19. However, the presence of insurance coverage is not always a relevant factor. As the court observed in Hunter v. Anderson, 2010 BCSC 1591 at para. 22: …it is in circumstances where a defendant’s insurance coverage creates an unfair advantage leading to unnecessary costs through testing the plaintiff’s case, where an insurer’s financial circumstances supplant those of the litigant as a factor to consider in determining costs.  I find that the presence of insurance coverage in the present case did not create an unfair advantage leading to unnecessary costs. It was the plaintiff who unreasonably rejected the defendant’s offer to settle. Therefore, I am unable to find a relevant significant disparity in the relative financial circumstances of the parties.  Unless there is some compelling reason to the contrary, the defendant is entitled to double costs from the date of the offer. Not only is there no reason to the contrary, in my view there is a compelling reason to accept the defendant’s argument. In my reasons for judgment which awarded damages to the plaintiff, I nevertheless found the plaintiff was an unreliable witness. This was not simply a matter of a witness who was honestly mistaken. I concluded the plaintiff had attempted to persuade me of facts that she knew were not true. On the costs hearing the plaintiff complained about my conclusions regarding her credibility but the costs hearing was not an occasion to re-argue her case for damages.  The plaintiff will be entitled to her costs up to the date of the offer to settle and the defendant will be entitled to double costs thereafter.
One issue that apparently was not argued on this application was whether the Rules of Court allow for double costs in these circumstances. While Rule 9-1 provides a Court with broad costs discretion following trials with formal offers in place, Rule 9-1(5)(b) seems to limit the Court to single post offer costs to a Defendant where they best their formal settlement offer. I am not sure if this matter has been judicially considered but it is certainly an argument a Court would need to grapple with if asked to do so.
(Update – April 19, 2013 – The below decision should be cross-referenced with reasons for judgement released today (Gonzales v. Voskakis) where Madam Justice Fitzpatrick came to a different conclusion)
Reasons for judgement were released this week by the BC Supreme Court, Victoria Registry, confirming that the Court cannot award double disbursements following a trial where a formal settlement offer was bested.
In this week’s case (Moore v. Kyba) the Plaintiff was awarded substantial damages in a jury trial following a motor vehicle collision. The damages awarded exceeded both the Plaintiff’s and Defendant’s pre-trial formal settlement offers. The Plaintiff brought an application seeking double costs and double disbursements. Mr. Justice Brown held that while it was appropriate to award double costs, Rule 9-1 does not go so far as to give the Court authority to award double disbursements. Mr. Justice Brown provided the following reasons: I am not convinced by the applicant’s argument. The repeal of the definition relied on in Browne v. Lowe is not determinative and does not require its reversal. In any event, I conclude that the proper interpretation of Rule 9-1(5) does not permit the Court to award double disbursements. In Rule 9-1(5)(a), the rule specifically provides for disbursements, while Rule 9-1(5)(b) does not. Therefore, properly interpreted, Rule 9-1(5)(b) does not permit the Court to award double disbursements after the delivery or service of the offer to settle.
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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.
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