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Tag: Verbal Settlement Agreements

Verbal Agreements Can Create Binding Settlements of Injury Claims in BC

While this is certainly not a new legal development (you can click here to access my archived posts addressing this topic) reasons for judgement were released this week by the BC Supreme Court, Vancouver Registry, confirming yet again that a verbal agreement can create a binding injury claim settlement and that refusing to sign the appropriate closing documents does not create an escape route for a litigant that regrets their decision.
In this week’s case (Robertson v. Whistler (Resort Municipality)) the Plaintiff was injured when she fell in a shower owned by the Defendant.  She was 8 years old at the time.  She started a lawsuit when she was 20.  In the course of the lawsuit the Defendant made a global settlement offer of $1,400.  The Plaintiff, in a phone conversation with the Defendant’s lawyer stated that she “wished to accept the $1,400 offer“.
The Plaintiff later refused to sign an agreed to Consent Dismissal Order.  The Plaintiff testified that “until she signed the offer and signed the order, there was no settlement“.  Madam Justice Hyslop disagreed and dismissed the lawsuit finding there was a binding settlement.  In addition the Court awarded the Defendant costs from the date of the settlement onward (which could result in the Plaintiff owing the Defendant money).
In confirming that a binding settlement was reached with the verbal agreement the Court provided the following reasons:

[31] Contract law applies to settlement agreements provided no contractual grounds to set aside the contract exist. Example: mutual mistake, lack of capacity, duress or fraud: Robertson v. Walwyn Stodgell Cochrane Murray Ltd., [1988] 4 W.W.R. 283, 24 B.C.L.R. (2d) 385.

[32] Settlement agreements need not be in writing to be enforceable. This was recognized in Sekhon v. Khangura, 2009 BCSC 670.

[33] Even if the oral agreement contemplates that it be reduced to writing, it is still enforceable: Young et al v. Fleischeuer et al, 2006 BCSC 1318. A party may decide not to pursue certain heads of damages as claimed and a settlement may be reached without addressing that particular head of damage: Prasad v. Ho, [1992] B.C.J. No. 643…

[47] The plaintiff changed her mind and repudiated the settlement as a result of the reaction of her father and the involvement of her aunt, Ms. MacDonald.

[48] I conclude that on December 16, 2010, the plaintiff entered into a binding settlement agreement. This action is dismissed with costs awarded to the defendant upon the basis that the sum of $1,400.00 due to the plaintiff will be set-off against the defendant’s assessed costs. Costs will be assessed under Appendix B, Scale B of the Supreme Court Civil Rules.