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Tag: tarriff costs

More on BC Supreme Court Trials and Costs

I’ve previously posted that when a Plaintiff in a BC Supreme Court Lawsuit is awarded damages in the Small Claims Court Jurisdiction ($25,000 or less) the Plaintiff is usually not permitted to court ‘costs’.
This is so because Rule 57(10) of the Supreme Court Rules holds that:
A plaintiff who recovers a sum within the jurisdiction of the Provincial Court under the Small Claims Act is not entitled to costs, other than disbursements, unless the court finds that there is sufficient reason for bringing the proceeding in the Supreme Court and so orders.
Today, reasons for judgement were released by the BC Supreme Court dealing with this section and the issue of when there is ‘sufficient reason for bringing a proceeding in the Supreme Court.’
In today’s case (Munro v. Thompson) the Plaintiff was awarded just over $12,000 for injuries sustained in a 2006 BC Car Crash.  The Defendant was apparently insured by ICBC and subject to ICBC’s Low Velocity Impact Defence.
The Plaintiff brought application seeking court ‘costs’.  He argued as follows:

[7]             The plaintiff says that “sufficient reason” is to be considered as at the time of commencement of proceedings: Riemann v. Aziz [2009] BCCA 448.

[8]             He says that at the date of commencement of the action, he had in hand the reports of two medical experts.  The conclusion arising from those is that it was a moderate/severe whiplash injury impacting on his future vocational capabilities, indicating a loss of capacity claim.

[9]             In these circumstances, counsel for the plaintiff contends there was good reason to bring his action in this court as opposed to the Small Claims division of the Provincial Court.

The defence lawyer argued that the Plaintiff should be deprived of ‘costs’ because the Plaintiff only recovered half of what could have been awarded in Small Claims Court therefore the Plaintiff should have started the lawsuit there.
In accepting the Plaintiff’s position Mr. Justice Williams applied the law as follows:

[22]         In order to determine the merit of the plaintiff’s claim for costs, it is necessary to examine whether he has shown that there was sufficient reason to have justified the decision to commence the proceeding in the Supreme Court.

[23]         Both parties accept that to be the correct analysis.  As well, both agree that the point in time at which the assessment is to be made is when the action in initiated.

[24]         In this case, plaintiff’s counsel had in hand the reports of two medical practitioners when he commenced the proceeding.  The report of Dr. Paterson, a treating chiropractor, concluded that the plaintiff’s symptoms of neck pain and stiffness, headaches, left shoulder pain and weakness are the result of a Grade III whiplash (moderate/severe) that he sustained in his July 6, 2006 motor vehicle accident. …

[25] There was also a medical-legal opinion from Dr. Condon….

26] Based on those opinions, it was not unreasonable for the plaintiff’s counsel to conclude that the action should be commenced in the Supreme Court.  The evidence indicated the likelihood of a viable claim for loss of future earning capacity as well as a not-insignificant claim for general damages.  Taking that into account, I am not prepared to find that his decision to bring the claim as he did was improper:  he had sufficient reason to proceed as he did when the writ was filed….

32] In the result, there is no basis to find that he deliberately misrepresented his situation to the doctors.  I stand by my conclusion that there was sufficient reason for bringing this proceeding in the Supreme Court, and reject the argument that he should be disentitled to the benefit of that finding because of his own conduct.

On another note, I posted yesterday about the new BC Supreme Court Civil Rules which come into force next year.   I have referenced these and it appears that the law as set out in Rule 57(10) of the current rules remains in place in the New Rules.  The relevant provision is set out in Rule 14-1(10) of the new Civil Rules.  The language there is identical to the current Rule 57(10) so precedents such as this case should remain good law after the new rules take effect.

ICBC Claims, Pre-Trial Costs and Rule 66

If you are involved in an ICBC claim under the fast track rule in BC Supreme Court (Rule 66) and settle your claim prior to trial how much are you entitled to for pre-trial Tarriff Costs?
Rule 66(29) governs and reads as follows:


(29)  Unless the court orders otherwise or the parties consent, and subject to Rule 57 (10), the amount of costs, exclusive of disbursements, to which a party is entitled is as follows:

(a) if the time spent on the hearing of the trial is one day or less, $5 000;

(b) if the time spent on the hearing of the trial is more than one day, $6 600

On the face of it, it appears that when a case settles pre trial up to $5,000 in costs could be included. However, recent court cases have applied a restrictive interpretation to this rule limiting the amount of pre-trial costs available in a Rule 66 action.   These cases have limited the amount of pre-trial costs available to $3,400.  Today, a case from the BC Supreme Court, Vancouver Registry, was released confirming this restrictive interpretation.

In today’s case (Cathcart v. Olsen) the Plaintiff settled her claim pre trial for an amount plus Tarriff costs.  At issue was how much should be paid for pre-trial Tarriff Costs.  Registrar Sainty of the BC Supreme Court,  in finding that the plaintiff was entitled to $2,890 in tarriff costs summarized the law and reasoned as follows:

[12]        The defendants argue that costs ought to be assessed as a proportion of the maximum allowable for pre-trial preparation under Rule 66, being $3,400. That proportion they say ought to depend on at what the stage in the proceedings the matter settled and how much pre-trial work remained to be done had the matter not settled. This, the defendants argue, is the required result applying the decision of Pittfield, J in Bowen v. Martinec, 2008 BCSC 104. In that case His Lordship was asked to answer the following question:

Where a formal offer to settle made under Rule 37 of the Rules and in Form 64 is accepted before trial in an action to which Rule 66 of the Rules applies, are the costs in the action assessed by reference to the fixed scale of costs under Rule 66(29) of the Rules or by reference to Appendix B to the Rules?

[13]        In answering the question put to him, His Lordship reviewed the law including the decisions of Macaulay, J in Duang and the Court of Appeal in Anderson (both supra) and held:

[21       In my opinion, the principles that can be derived from Duong and Anderson should be applied in the determination of costs in circumstances where an offer has been accepted before the commencement of trial. It is evident from Rule 66 that a cap has been imposed upon the recovery of costs in an action to which the Rule applies. It is also clear that the court can give effect to Rule 37 offers to settle. I am unable to identify any reason why the Rule 66 regime should apply in respect of the determination of costs following a trial where offers to settle have been made and rejected, but those situations where an offer is made and accepted before trial should justify taxation under Appendix B.

[22]      I adopt the view expressed by Macaulay J. which is that the amount of recoverable costs stipulated in Rule 66 should be allocated in part to trial and in part to pre-trial preparation. The part allocable to trial should be determined by deducting the global costs contemplated in respect of a one-day trial from the global costs contemplated in respect of a two-day trial. The costs for pre-trial preparation in either case should be determined as the difference between the global cost amount for a one-day trial and the daily trial costs. As the Rule presently stands, the recoverable costs per day of trial are $1,600, and the recoverable costs attributable to pre-trial preparation, $3,400.

[14]        His Lordship then stated:

[24]      It will be incumbent upon the parties to agree on the proportion of the pre-trial preparation which had been undertaken by the plaintiff to the date of the defendant’s offer to settle. In the absence of an agreement, the parties may resolve differences on taxation, whereupon the court will exercise the discretion conferred upon it by Rule 66(29.1).

[25]      It follows that the answer to the stated case is that costs in an action subject to Rule 66, settled before trial pursuant to an offer of settlement must be assessed by reference to the fixed scale of costs under Rule 66(29), and not by reference to Appendix B to the Rules of Court.

[15]        Essentially Pitfield J’s decision mandates that, where a formal offer to settle has been made in accordance with the Rules, pre-trial costs are to be based on the proportion of pre-trial preparation that has been undertaken up to the date of the offer to settle and the party to whom costs are to be paid is entitled to its proportionate share of the $3,400 cap. Mr. Chaudhary, for the defendants, argues that the same principles ought to apply in these circumstances where, although no formal offer to settle was made, an informal settlement was reached. He submits that I ought not to deviate from the methodology proposed by Pitfield, J. in Bowen (supra).

[16]        Mr. Harbut, for the plaintiff, suggests however that Pitfield, J’s decision in Bowen cannot be reconciled with the decision of the Court of Appeal in Anderson.  He submits Anderson should be read to say that, while there is a ceiling in the amount of costs that a successful litigant may be awarded, where a Rule 66 action has been settled, provided the party whose costs are being assessed can satisfy the assessing officer that that party would be entitled, under Appendix B of the Rules, to at least the amount of the ceiling ($3,400) in tariff items then that party is entitled to be awarded the full amount of that ceiling. I cannot agree with this latter submission. In my view, I am bound to employ the same reasoning as that employed by Pitfield, J in Bowen to these circumstances; i.e. award the plaintiff his proportionate share of the cap, based on the stage of preparation reached as at the date of the offer to settle.

[17]        That being said, there is one additional issue which must be considered. In Anderson, the Court of Appeal states (at ¶47):

I also agree with Macaulay, J that the intent of the rule [Rule 66] was to avoid the necessity of a taxation and that it would frustrate that intent to order a taxation of costs under the rule…

[18]        Accordingly, the Court of Appeal has endorsed the presumption that the intent of Rule 66 is to avoid the necessity of an appearance before the registrar to assess costs. Pitfield, J’s method – to determine costs dependant on the stage of the pre-trial preparation – seems to me to invite assessments, rather than reduce them. I say this as, in instances where the parties cannot agree on the proportion of work undertaken at the time of settlement, taxation becomes the likely, rather than the unlikely, course.

[19]        To counterbalance this, however, I believe that the Court of Appeal in Anderson has also endorsed a somewhat “rough and ready” manner of assessing the consequences of accepting an offer to settle when the provisions of Rule 66 apply (see paragraph 49). The Court of Appeal suggests that an assessing officer, on an assessment of costs in similar circumstances, should use a rough and ready approach to establish what stage the proceeds were at when settlement was reached in deciding what proportion of the “cap” ought to be paid. That rough and ready approach (and the one I will employ here), in my view includes both a consideration of the work done to the date of settlement by the party to whom the costs are to be paid as well as a consideration of what costs the payee might be entitled to under the tariff if costs were awarded under Appendix B of the Rules.

[20]        Mr. Harbut stated that his pre-trial preparation had progressed to a great extent when the offer was accepted. He confirmed that the items that had been undertaken included commencing the action, discovery of documents, some examinations for discovery, settlement negotiations and production of expert reports. He argued that, with the exception of the actual trial, most of the trial preparation had been completed. Thus the plaintiff should be awarded substantially all of the amount of the cap.

[21]        Mr. Chaudhary in his submissions set out a number of items that remained to be done (additional document discovery, witness preparation, further expert’s reports, to name a few) and argued that as this action settled some four months before trial a substantial amount of work remained to be done and the proportion awarded should reflect that.

[22]        Here, I am satisfied that some 85% of the work required to prepare for trial had been done up to the date that the offer was accepted. Accordingly, the plaintiff is entitled to $2,890 in “tariff” costs plus applicable taxes, together with such disbursements as have been agreed between the parties. In my view a substantial amount of work had been done to prepare for the trial. In addition, had the costs been awarded under Appendix B of the tariff the plaintiff would likely have received at least 10 units under item 1B, 2 to 3 units under item 3, 2 to 3 units each under items 7 and 8, 4.5 units under items 14 and 15, 2 or 3 units under each of Items 13A and 13B, plus 5 units for item 34 resulting in, on a rough and ready calculation, of some 31 to 35 units, well within or certainly more than I am awarding in these circumstances.

[23]        If the parties require a certificate they may prepare it, each sign it and forward it to me for my signature.