Source: http://bc-injury-law.com/blog/category/settlement-law
Timestamp: 2019-04-23 16:33:05+00:00

Document:
Reasons for judgement were released this week by the BC Court of Appeal discussing the effects of a Solicitor’s Lien under the Legal Profession Act in the context of a personal injury claim prosecuted on a contingency basis.
30] The nature of the charge arising may be described an “inchoate right”, the crystallization of which requires only the pronouncement of the court [see Re Tots and Teens Sault Ste. Marie Ltd., et al (1975), 65 D.L.R. (3d) 53 (Ont. H.C.J.)]. While the charge exists, by statute, upon the recovery of property as a result of the retained lawyer’s efforts, the charge only becomes enforceable upon declaration by the Court under s. 79(3).
 This analysis is consistent with the decision of the Supreme Court of British Columbia in Jenik v. Fearn, (1995) 130 D.L.R. (4th) 695 (B.C.S.C.), and in Chouinard.
 The decision of whether to make a declaration upon application is a discretionary one. The judge must be satisfied that it would be “just and proper” to grant the order (see Wilson, King & Co. v. Lyall (Trustees of) (1987), 12 B.C.L.R. (2d) 353 (C.A.), and Cliffs Over Maple Bay Investments Ltd. (Re), 2011 BCCA 346, 21 B.C.L.R. (5th) 297).
It is my opinion that the words “any property” used in s. 79 of the Legal Profession Act are as well of the widest possible character, and include a chose in action. Further, I am of the view that the specific property need not be immediately ascertained. It is generally, but not exclusively, the client’s interest in the property which is subject to the charge: Walker v. Saunders, supra. The ascertaining of the extent of that interest may occur subsequent in time to the creation of the charge.
 In my respectful opinion, the argument that a charging order under s. 79 cannot have retrospective effect is not supported either by the language of the statute or by the relevant caselaw.
As previously discussed (you can click here to read all my archived posts on this topic), a binding ICBC settlement can be reached even before the ‘full and final release’ is signed. An oral contract can be the point of no return. Reasons for judgement were released last week by the BC Supreme Court, Vancouver Registry, demonstrating that once a lawyer accepts a settlement offer on behalf of a client it likely becomes too late for the client to change their mind.
In last week’s case (Truong v. Marples) the Plaintiff was injured in a motor vehicle collision. She hired a lawyer to advance her personal injury claim. In the course of the lawsuit ICBC’s and the Plaintiff’s lawyer agreed to a $10,000 settlement.
I repeat my previous words of caution about settlement instructions. If a lawyer enters into a binding settlement without a client’s consent the client’s remedy is against their lawyer as opposed to the Defendant in the ICBC Claim. In the best interests of everyone involved it is vital that lawyers do not accept an ICBC settlement offer unless they have clear instructions from their clients to do so. A best practice when giving settlement instructions to a lawyer is to do so in writing to help avoid potential complications.
I can’t say whether this 1:1 ratio is right or wrong, however Alan’s question could be the beginning of an interesting discussion. If anyone is aware of statistics addressing how often self-represented individuals receive unfair settlements and the global cost of “unconscionable” settlements on the public at large this information should be publicized. If unfair adjusting practices short change deserving claimants anywhere near the figures the Canadian insurance industry claims fraud costs them then that is a story that needs to be told.
Now I’m no fan of insurance fraud, however, when reading stories of the high cost of insurance fraud it’s worth keeping in mind that, unlike the insurance industry, claimants who get stuck with an unconscionable settlement don’t have hundreds of millions of dollars in profits to offset the cost of a raw deal. Also, the insurance industry (to their credit) has a good track record of pursuing civil damages to punish and discourage fraudulent conduct. The same likely cannot be said about individuals who have their insurance claims processed in bad faith. As always, comments and feedback are welcome.
In my continued efforts to track the judicial development of Rule 37B, reasons for judgement were released today by the BC Supreme Court, Vancouver Registry, awarding a Plaintiff double costs for the trial of her ICBC claim. The contentious issue of the existence of Insurance as a potentially relevant factor was also considered.
In today’s case (Pham-Fraser v. Smith) the Plaintiff was injured in a BC motor vehicle collision. Before trial the Defendant (insured with ICBC) offered to settle under Rule 37B for $115,000. The Plaintiff responded with a formal settlement offer of $149,000. Neither party accepted the respective offers and proceeded to trial where the Court awarded just over $400,000 in total damages (click here to read my previous post discussing the trial judgement).
 The second factor referred to in Rule 37B(6) also operates in the plaintiff’s favour. There is a wide difference between the offer to settle and the final judgment. The judgment is almost three times the amount offered. The plaintiff’s offer was made because she wished to avoid court and having to give her evidence. Some of her evidence was of a private nature relating to matters she did not wish to talk about in the public forum of a court of law (that is, how the accident affected her work and home life, her marital relationship with her husband after the accident, and the fact she suffered from incontinence).
 It is not necessary to consider factors set out in Rule 37B(6)(c) and (d). I do not accept the plaintiff’s submission I ought to consider that the defendants, being represented by ICBC, are in a “sophisticated” position in terms of providing settlement instructions and that this is a factor to be taken into account and operate in the plaintiff’s favour in exercising my discretion under the rule. The plaintiff’s argument seems to me to simply be another way of putting a “deep pockets” argument forward: an argument the courts have thus far rejected as being a factor to be considered in determining whether to award costs under Rule 37B.
 After considering the factors which I do consider relevant under Rule 37B, I conclude the plaintiff is entitled to an award of double costs.
As previously discussed, the BC Supreme Court is inconsistent on whether a Defendant being insured is a relevant factor under Rule 37B and clarity from the Court of Appeal would be welcome. While more cases than not have held that insurance is not a relevant consideration it is not yet clear that this is correct. If the law was settled it would assist lawyers in advising their clients of the potential risks and benefits of trial.
In my continued efforts to get us all prepared for the New BC Supreme Court Civil Rules I will again point out that Rule 37B will be replaced with Rule 9 under the New Rules. The new rule uses language that is almost identical to Rule 37B which should help cases such as this one retain their value as precedents.
Further to my previous posts on this topic, if a Plaintiff successfully sues in the BC Supreme Court but receives damages below $25,000 they may be deprived of their court ‘costs’ unless they had ‘sufficient reason’ for choosing the Supreme Court over small claims court.
Two judgements were released this week by the BC Supreme Court discussing this area of law. In this weeks cases (Spencer v. Popham and Spencer v. Horton) the Plaintiff was involved in 2 separate BC car crashes. She started separate lawsuits in the BC Supreme Court but settled her cases before they went to trial. Both claims settled form amounts below $25,000 (the current financial limit of BC’s small claims court). The Plaintiff and ICBC could not agree on the issue of costs.
 This rule encourages persons to bring actions in Small Claims Court when a claim falls within that court’s monetary jurisdiction. It is an example of “proportionality”; the judicial process should match the amount in dispute. However, the court must also respect a party’s “legitimate choice” of forum: Reimann v. Aziz, 2007 BCCA 448, 286 D.L.R. (4th) 330 at para. 35.
 The burden is on claimants to evaluate their claims prior to commencement and to justify their decision if they recover less than the Small Claims Court limit, currently $25,000:Reimann at para. 38. If plaintiffs fail to sufficiently investigate and assess their claims prior to commencement, they risk not recovering costs. In a personal injury action this may require plaintiffs to obtain medical records and medical reports, to gather evidence to support claims for loss of earnings and earning capacity, and to assess the evidence in support of the claims being advanced before commencing the action.
 The proviso in Rule 57(10) is “unless the court finds that there was sufficient reason for bringing the proceeding in Supreme Court and so orders”. The Rule does not define “sufficient reason”. There is nothing in the Rule that limits the extension of the term “sufficient reason” to matters relating to the quantum of the claim.
Other factors can be the need for the plaintiff to have legal counsel (Faedo v. Dowell, 2007 BCSC 1985 at para. 36; Ostovic v. Foggin, 2009 BCSC 58 at para. 42; Gradek at para. 43), and the defendant’s denial of liability, causation, and injury or loss and allegations of contributory negligence, pre-existing conditions, previous causes and a failure to mitigate (Ostovic at paras. 39-40; Gradek at para. 35).
 Therefore, a plaintiff’s evaluation of his or her claim, can also involve an assessment of these factors. Even if the plaintiff assesses the claim to be within the jurisdiction of the Small Claims Court, the plaintiff can rely on these other reasons to commence the action in Supreme Court: Johannson v. National Car Rental (Canada) Inc., 2009 BCSC 1284 at para. 5.
 In my opinion, a plaintiff’s simple desire to retain counsel is not in and of itself a sufficient reason for commencing the action in Supreme Court. Other factors, such as those noted above, determine whether retaining counsel is justified.
 … I observed this plaintiff to be very nervous in court. She had no previous experience in court and in my opinion when she was confronted with a case where the defendant represented by counsel was suggesting that she hadn’t been injured at all and this was a low impact accident in which it was suggested she wouldn’t be injured, that the plaintiff reasonably required counsel to represent her and reasonably started an action in the Supreme Court where she could hope to recover some of the cost of retaining that counsel which was necessary for her to properly put her case to get the compensation I have found her entitled to. Furthermore, an offer to settle such as the plaintiff made in this case puts very little pressure upon a defendant to settle where there is no exposure to costs.
 There is the additional factor that, as in Faedo and Kanani [v. Misiurna, 2008 BCSC 1274], the Plaintiff faced an institutional defendant which, in the ordinary course, has counsel. To obtain any recovery the Plaintiff is forced to go to court, where he is facing counsel and counsel is reasonably required, but in Provincial Court there is no way of recovering the costs of counsel.
 In Gradek, before the issuance of the writ, the defendants’ insurers had informed the plaintiffs that their position was the accident did not result in any compensable injury. In their pleadings, the defendants denied liability and injury or loss and alleged contributory negligence, the existence of a pre-existing injury and previous causes, and a failure to mitigate. There was a broad range of findings possible respecting liability. The plaintiff, Henryk Gradek, was a Polish immigrant who spoke halting English. Justice Savage found at para. 42 that “he would have had extraordinary difficulty presenting a case on his own” and would have been “out-matched” by either a lawyer or an ICBC adjustor. The plaintiff needed counsel to obtain a just result and, therefore, had sufficient reason to begin the action in Supreme Court.
 Plaintiffs do not have an ongoing duty to reassess their claims as the matter proceeds: Reimann at para. 44. Thus, the court must assess whether a plaintiff had “sufficient reason” to bring the action in Supreme Court when the plaintiff started the action: Ostovic at para. 35. This analysis is necessarily done with the benefit of hindsight since it only occurs after trial or settlement, but the court must be careful not to use that hindsight in deciding what was reasonable: Faedo at para. 28.
 It also must be remembered R. 57(10) “does not involve an exercise of discretion.” Rather, “the court must make a finding that there was sufficient reason for bringing the action in the Supreme Court” (emphasis added): Reimann at para. 13.
In my continued effort to cross reference the current Supreme Court rules with the new Rules of Court that come into force on July 1, 2010 I will note that the Current Rule 57(10) will become Rule 14-1(10) and it reads identical to the current rule so the precedents developed under Rule 57(10) regarding costs should continue to assist litigants under our new rules.

References: v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v.