Source: http://bc-injury-law.com/blog/tag/bc-supreme-court
Timestamp: 2019-04-23 16:24:32+00:00

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When taking an ICBC or other BC personal injury claim to trial in the Supreme Court it is vital to understand the financial consequences that can be triggered when formal settlement offers are made. I have written dozens of articles on this topic and you can access these here.
Below is a brief video discussing some of the key factors you need to consider when reviewing ICBC’s formal settlement offer under the BC Supreme Court Rules and further the issues you should consider when making your own formal settlement offer. I hope this information is of assistance.
A year ago the BC Rule dealing with formal offers in the BC Supreme Court, Rule 37, was repealed and replaced with Rule 37B. One of the primary differences between the rules was the greater discretion given to trial judges in awarding costs to litigants after beating a formal settlement offer at trial.
I have written about every Rule 37B case that came to my attention over the past year keeping track of the judicial development of this rule. Now, after being in force for a short period of time, Rule 37B is being amended with the changes taking effect on July 1, 2009.
The new changes seem to be in direct response to a recent judgement of Mr. Justice Goepel where he decided that Rule 37B does not give judges the discretion to award Defendants their trial costs after beating a formal offer of settlement at trial. This interpretation was great for Plaintiffs in personal injury claims because it diminished the financial risks for personal injury trials that did not proceed favorably. I thought that the Court of Appeal would likely determine whether Mr. Justice Goepel’s interpretation was correct but this no longer will be necessary as the Rule amendment specifically addresses this point.
Interestingly, the new rule does not specifically address whether a Defendant being insured is a relevant factor for the court to consider when looking at the ‘financial circumstances of the parties’. BC Courts have been inconsistent in determining whether this is a relevant consideration in ICBC Injury Claims.
(2) The fact that an offer to settle has been made must not be disclosed to the court or jury, or set out in any document used in the proceeding, until all issues in the proceeding, other than costs, have been determined.
(3) An offer to settle is not an admission.
(d) if the offer was made by a defendant and the judgment awarded to the plaintiff was no greater than the amount of the offer to settle, award to the defendant the defendant’s costs in respect of all or some of the steps taken in the proceeding after the date of delivery of the offer to settle.
(7) A plaintiff who accepts an offer to settle for 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 was sufficient reason for bringing the proceeding in the Supreme Court and so orders.
(8) An offer to settle does not expire by reason that a counter offer is made.
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?
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.
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?
[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.
 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.
 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).
 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.
 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).
 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.
 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.
 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.
 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.
 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.
 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.
 If the parties require a certificate they may prepare it, each sign it and forward it to me for my signature.
Well the cases seem to be coming in at a good pace and hopefully Rule 37B will start seeing some consistency in its interpretation by the BC Supreme Court.
 I turn first to the policy reasons behind the new rule.
 Rule 37 is clearly designed to encourage the early settlement of actions. It does so by rewarding the party who makes an early and reasonable settlement offer, and by penalizing the party who declines to accept such an offer. The reward or penalty takes the form of costs (in some cases, double costs) from the date the offer is made. The significant role which costs now play in the litigation process operates as a powerful incentive to parties to make early offers of settlement under the Rule and to accept reasonable offers.
 These Rules are designed to discourage frivolous actions and defences and to encourage the parties to make reasonable offers to settle as early as possible. Thus, party and party costs serve many functions. They partially indemnify the successful litigant, deter frivolous actions and defences, encourage both parties to deliver reasonable offers to settle, and discourage improper or unnecessary steps in the litigation.
 In Mackenzie v. Brooks et al, 1999 BCCA 623 (sub nom. Mackenzie v. Brooks et al) 130 B.C.A.C. 95 at p. 21, the British Columbia Court of Appeal described the predecessor rules to Rule 37B as designed to encourage settlement by, among other things, “penalizing the party who declines to accept” an offer to settle.
 While Rule 37B has brought about the reversion from a strict code to a reliance on judicial discretion with respect to costs, the use of costs to encourage or to deter certain types of conduct remains, albeit based upon the factors set out in subrule 37B(6).
 I turn now to the factors under Rule 37B.
 In my opinion, given the fact that the offer was made three years and almost four months after the date of the accident and well over a year after the action was commenced, the plaintiff should have known what medical information was available to him. I agree with the defendants that this is a case where Mr. Leus was working full time from the date of the accident. It is true that in Fast Track Litigation it is not cost efficient to end up with several medical legal reports from one doctor. However, Mr. Leus did not have any information from Dr. Hodgeson, informal or otherwise, at the time of the offer.
 As the defendants point out, the plaintiff could have contacted Dr. Hodgeson earlier. By the time the report was requested, it was already 60 days before the trial so the rule requiring notice could not have been met in any event. The further requests that were made were well within the 60 days.
 The offer was made in timely manner and at a time when the plaintiff should have known his case. It was an offer that ought reasonably to have been accepted at the date of the offer.
 While I have considered the argument that the defendants, because of the participation of ICBC, can take advantage of making an early, low offer, in my opinion there is no such unfairness demonstrated.
 In this case, $16,000 is a more favourable amount to the plaintiff than the $12,748.48 ordered by the court. This factor favours the plaintiff being penalized for not accepting an award 20 percent greater than the judgment. The fact that the numbers are low does not change the analysis.
 The plaintiff argues that he should get preference under this factor because ICBC has significantly more resources to absorb the costs of litigation than he does and, as a result, ICBC is in a unique position to make early offers to settle.
 The defendants argue that ICBC is not a party and the legal principles that developed under the old rule should still apply. It would not be fair, they argue, if they were forced to pay the entire judgment, disbursements, and their own costs after they made a reasonable formal offer that was more than the final award.
 Different views have been expressed by members of the court on the question of the relevance of fact that the defendants have insurance.
 Mr. Arnold has asked that I take into account the relative financial circumstances of the parties when exercising my discretion. I find that I am unable to do so. First, Mr. Arnold has provided no evidence regarding his financial circumstances other than the assertion that the likely result of a costs award in favour of the defendant will leave him with no recovery from the action. Rule 37B gives this Court greater discretion than it had under the old Rule 37. It specifically allows the Court to consider the relative financial circumstances of the parties. However, there will always be a substantial difference between the relative financial circumstances of the usual personal injury plaintiff and the defendant’s motor vehicle insurer. That difference, in and of itself, is not enough for the Court to exercise its discretion to deprive the defendant of costs. If that was the intent of the new rule, it would have been more clearly articulated.
 In the case at bar, on a review of the Rule and the authorities, I conclude that the plaintiff is indeed entitled to double costs from the date of the August 12th offer of settlement forward…It is also clear that there is a substantial disparity in financial circumstances between the parties. The defendants, represented by ICBC, had substantially greater resources to finance a trial than the individual plaintiff. Had the defendants accepted the plaintiff’s initial reasonable offer, the plaintiff would not have had to incur the significant costs associated with nearly two weeks of trial.
 The defendants argue that Rule 57(10) should be considered whereas the plaintiff says that the Court is only being asked to decide entitlement to costs and not quantum, so Rule 57(10) is not applicable.
 I am satisfied that Mr. Leus has shown that at the time his claim was initiated, there was a sufficient reason to bring the action in Supreme Court. The amount he was claiming was close to the line; it was appropriate to use the discovery process to obtain evidence of the others involved in the accident: Reimann v. Aziz, 2007 BCCA 448, 72 B.C.L.R. (4th) 1.
 In conclusion, the purpose of Rule 37B is to encourage settlement and avoid frivolous use of court resources by imposing punitive cost sanctions. In the present case, the defendants made a reasonable offer to settle that ought to have been accepted by the plaintiff. The offer was 20 percent higher than the plaintiff’s final award. Given the overarching purpose of Rule 37B, Mr. Leus should be denied his costs, including his disbursements of $7,500, from the date of the offer, because he failed to accept the offer to settle.
 However, though the court could award the defendants single costs, I have decided it is not appropriate to do that in the particular circumstances of this case. The decision depriving the plaintiff of his costs meets the objectives of the Rule. I have considered, in particular, the size of the award, the fact that it was less than $4,000 lower than the offer, and the impact of this decision on what Mr. Leus will actually receive.
One important difference between the BC Supreme Court and BC Small Claims Court is the availability of court ‘costs’ to the winning litigant.
A winning party in the Provincial Court is usually awarded their disbursements, that is, the money it cost to bring the legal proceedings such as court filing fees, the cost of producing medical evidence etc. The winner cannot, however, be awarded Tariff Costs (money to compensate the party for the various steps they took in the lawsuit). This can be contrasted with the Supreme Court where a winning party can be awarded Costs and Disbursements. This can make a big difference as a ‘costs’ award after a Supreme Court trial could easily exceed $10,000.
(10) 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 was sufficient reason for bringing the proceeding in the Supreme Court and so orders.
So, the question is when is there sufficient reason for bringing an ICBC injury claim in Supreme Court when the claim ends up being worth less than $25,000? Reasons for judgement were released today by the BC Supreme Court addressing exactly this question.
 The plaintiff Truong relies upon a decision of this court in Caldwell v. Maga  B.C.J. No. 2166 (BCSC) where there were two plaintiffs, one being awarded $5,500 for damages and the other $4,500 for damages, both involved in a rear end accident. This was at a time when the limit in small claims actions was $10,000.
 Mr. Justice Drost referred to a previous decision of Mr. Justice Drake where he also dealt with two plaintiffs, who were each awarded under $10,000, and said in awarding them costs that the totality of the two judgments amounted to more than the small claims limit and they were entitled to costs.
 Mr. Justice Drost determined to follow the reasoning of Mr. Justice Drake in that decision (Phosy & White v. Island Pacific Transport Ltd.  B.C.J. No. 1037, (2 May 1996), Victoria Registry No. 95/1123).
 I question the correctness of these two decisions as I tend to agree with defence counsel that taken to its logical conclusion that reasoning would mean that 26 claimants each with $1,000 claims would be entitled to sue in Supreme Court in one writ because the total would exceed $25,000, the present limit of small claims jurisdiction.
 I consider it far more likely that the $25,000 limit of small claims jurisdiction should apply to each claim of each plaintiff no matter how many plaintiffs there might be.
 However, I am obliged to follow the previous decisions of this Court which would probably entitle the two plaintiffs to sue in Supreme Court.
 Apart from this, at the best of times I consider it difficult for any plaintiff’s counsel to estimate the appropriate range involved for personal injury claims of his clients at the initiation of the action. The medical conditions of many plaintiffs continue to change following the initiation of the action as they continue to recover from their injuries or continue to suffer.
 Here, even after Dr. Yong’s optimistic report of March 14, 2006, by January 26, 2008 he was still saying that it was likely that the plaintiff Truong would continue to suffer some degree of left shoulder pain probably for another one or two years.
 The award to the plaintiff Truong of $20,000 is by itself less than the limit of jurisdiction in small claims of $25,000, but is not less by any large amount, and with the difficulty facing counsel of accurately estimating the range for a personal injury for his client at the initiation of litigation, knowing that if action is commenced in small claims his client will be limited to $25,000 no matter that the assessment might be in excess of $25,000, I am satisfied this plaintiff did have sufficient reason for bringing her claim in Supreme Court.
 The plaintiff Truong will therefore have her costs of her claim at Scale B, only attributable to her claim.
Today I’m blogging from sunny Kamloops from my colleague Peter Jensen’s office. Clients are coming soon so I have to keep this short.
The Supreme Court of BC has an unlimited monetary jurisdiction whereas BC small claims court currently has a jurisdiction of $25,000 or less. When suing for damages as a result of a BC car accident you have to decide which court you will sue in.
When involved in an ICBC tort claim in the BC Supreme Court the winner can be awarded Costs, whereas in Small Claims Court the winner can only be awarded disbursements as opposed to Tariff Costs.
When you bring an ICBC claim in Supreme Court and are awarded less than $25,000 can you still be awarded your court tariff Costs? The answer is sometimes.
The question then is, did you have a good reason to sue in Supreme Court when you started the lawsuit?
 The relevant time at which the value of (the Plaintiff’s) claim should be assessed, then, is when the action was commenced. At that time, (the Plaintiff) still had some residual effects from the accident and was missing the occasional day of work. I found this evidence credible, and noted that she still had occasional flare-ups, with decreasing frequency. Her voluntary retirement worked to the benefit of the defendant in that any potential ongoing wage loss from these flare-ups would not be claimed against him. (the Plaintiff) was careful to ensure that only those days attributable to the effects of the accident were claimed for. She asserted a claim for loss of earning capacity, but decided not to pursue it by the time of trial. Although such an award would not have been large, if any at all were established, it is difficult to say, in hindsight, that the entire claim would obviously have come under the Small Claims limit of $25,000 at the time the action was commenced. Plaintiff’s counsel subsequently came to assess the claim with the advantage of all the information available by the time of trial and to put forward a realistic and sustainable range of damages in his final submissions, but that is not, according to Reimann, relevant to the present issue.
 In Faedo v. Dowell and Wachter, M064051 (October 19, 2007) Vancouver, Curtis J. held that in a situation where the defendant put the plaintiff to the proof of having suffered any injury at all, thus making her credibility a crucial issue at trial, it was reasonable for the plaintiff to require the assistance of counsel. She was therefore justified in commencing the action in Supreme Court where she could hope to recover some of the costs it was necessary for her to expend in retaining counsel to recover the compensation to which she was found to be entitled. This reasoning has application here as well.
 In the result, the plaintiff has advanced sufficient reason for having commenced her action in this court and is entitled to her costs pursuant to Rule 66.
This is a good judgement for Plaintiffs bringing ICBC claims, particularly those involved in Low Velocity Impacts (LVI’s) where ICBC denies that injury occurred. It recognizes the fact that ICBC often tells people that they aren’t injured at all and this brings their credibility into play. Here the court realized that in such circumstances it is appropriate to hire a personal injury lawyer and try to offset some of these costs by suing in Supreme Court even though the Small Claims Court has sufficient monetary jursidiction to deal with the tort claim.
So you are injured in a BC car accident and start an ICBC claim. ICBC makes an inadequate settlement offer for your pain and suffering and you start a lawsuit in BC Supreme Court. Then, your injuries take a turn for the better and you realize your claim can adequately be dealt with more efficiently in Small Claims Court. Can you apply to move your claim down? Absolutely!
(c) the judge or master considers it appropriate to do so.
Both Supreme Court and Small Claims Court have their own strengths and weaknesses as forums for advancing ICBC injury claims. The decision of which court to sue in is not always an easy one and it is a good idea to get a free consultation with an ICBC claims lawyer before deciding how to proceed. It is reassuring, however, to know that after you start in Supreme Court you can bring an application to transfer the proceeding to the lower court.
Today, reasons for judgement were released allowing just such an applicaiotn that is worth reviewing for anyone involved in an ICBC Supreme Court claim that is considering moving down to the Provincial Court.

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