IN THE SUPREME COURT OF BRITISH COLUMBIA

Date: 20110512

Docket: 41642

Registry:
Kamloops

Between:

Joan Vienna Miller

Plaintiff

And

Ryan MacGregor
Boughton

Defendant

Before:
The Honourable Madam Justice Hyslop

Reasons for Judgment

[1]            
The plaintiff and the defendant litigated the plaintiff’s claims before
a jury relating to a motor vehicle accident that occurred in Kamloops, British
Columbia on July 22, 2006.

[2]            
The trial was tried before a jury in December of 2010 for seven days.

[3]            
The jury was required to determine as between the plaintiff and
defendant who was responsible for the accident and the assessment of any
damages suffered by the plaintiff.

[4]            
The jury concluded that the defendant was 55% responsible for the
accident and the plaintiff 45% responsible for the accident.

[5]            
The jury awarded the plaintiff $6,000.00 non-pecuniary damages,
$1,500.00 past wage loss, and $100.00 in special damages for a total of
$7,600.00, less 45% of the plaintiff’s contributory negligence is $4,180.00.
Deducted from this amount is $300.00 under s. 83 of the Insurance (Vehicle)
Act, R.S.B.C. 1996, c. 226. The total award was $3,880.00.

The Plaintiff’s Position

[6]            
The plaintiff’s position is that she should receive 55% of her costs
pursuant to s. 3 of the Negligence Act, R.S.B.C. 1996, c. 333. The
plaintiff argues that the Court should use its discretion pursuant to Rule
9-1(4), (5) and (6) of the Supreme Court Civil Rules (the “Rules”)
and award no costs to the defendant.

[7]            
At paragraph 3 of the plaintiff’s outline, the following relief is
sought:

3.         In the alternative, that the
Court use its discretion pursuant to Rule 9-1(4), (5) and (6) to decline to
order costs payable to the Plaintiff after the date of the relevant settlement
date pursuant to Rule 9-1(5)(a), therefore ordering that the parties bear their
own costs.

[8]            
I find this alternate position difficult to understand. I am assuming
that it means the date that the plaintiff ought to have accepted the
defendant’s offer.

The Defendant’s Position

[9]            
The defendant is not seeking double costs pursuant to the Rules.

[10]        
The defendant argues that the plaintiff should be awarded 55% of her
costs and disbursements up until December 23, 2008, and the defendant should be
awarded 100% of his costs and disbursements from December 23, 2008 forward. The
defendant argues that costs should be assessed at Scale B of Appendix B.

[11]        
The defendant argues that the plaintiff should be responsible for the
$2,000.00 account of the Ministry of the Attorney General for daily hearing
fees.

[12]        
It was not argued that the plaintiff not receive costs, as the jury’s
award was within the jurisdiction of the Small Claims Act, R.S.B.C.
1996, c. 430.

The Negligence Act, R.S.B.C. 1996, c. 333

[13]        
The legislative basis and the rules of which are relevant are as follows:

Awarding of damages

2 The awarding of damage or loss in every action to which
section 1 applies is governed by the following rules:

(a) the damage or loss, if any, sustained by each person
must be ascertained and expressed in dollars;

(b) the degree to which each person was at fault must be
ascertained and expressed as a percentage of the total fault;

(c) as between each person who has sustained damage or loss
and each other person who is liable to make good the damage or loss, the person
sustaining the damage or loss is entitled to recover from that other person the
percentage of the damage or loss sustained that corresponds to the degree of
fault of that other person;

(d) as between 2 persons each of whom has sustained damage
or loss and is entitled to recover a percentage of it from the other, the
amounts to which they are respectively entitled must be set off one against the
other, and if either person is entitled to a greater amount than the other, the
person is entitled to judgment against that other for the excess.

Apportionment of liability
for costs

3 (1) Unless the court otherwise directs, the liability for
costs of the parties to every action is in the same proportion as their
respective liability to make good the damage or loss.

(2) Section 2 applies to the awarding of costs under this
section.

(3) If, as between 2 persons, one
is entitled to a judgment for an excess of damage or loss and the other to a
judgment for an excess of costs there is a further set off of the respective
amounts and judgment must be given accordingly.

The Supreme Court Civil Rules – Rule 9-1(4), (5)(a)-(d) and
(6)(a)-(d)

Offer may be considered in relation to costs

(4) The court may consider an offer to settle when exercising
the court’s discretion in relation to costs.

Cost options

(5) In a proceeding in which an offer to settle has been
made, the court may do one or more of the following:

(a) deprive a party of any or all of the costs, including
any or all of the disbursements, to which the party would otherwise be entitled
in respect of all or some of the steps taken in the proceeding after the date
of delivery or service of the offer to settle;

(b) award double costs of all or some of the steps taken in
the proceeding after the date of delivery or service of the offer to settle;

(c) award to a party, in respect of all or some of the steps
taken in the proceeding after the date of delivery or service of the offer to
settle, costs to which the party would have been entitled had the offer not
been made;

(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 or service of the
offer to settle.

Considerations of court

(6) In making an order under subrule (5), the court may
consider the following:

(a) whether the offer to settle was one that ought
reasonably to have been accepted, either on the date that the offer to settle
was delivered or served or on any later date;

(b) the relationship between the terms of settlement offered
and the final judgment of the court;

(c) the relative financial circumstances of the parties;

(d) any other factor the court considers appropriate.

Background

[14]        
The plaintiff commenced this action on July 18, 2008.

[15]        
The plaintiff, in her amended statement of claim, alleged that she
suffered the following injuries as a result of the negligence of the defendant:

(a)        low and mid back injuries;
(b)        abdominal injuries;
(c)        bruised kidneys;
(d)        neck injuries;
(e)        shoulder injuries;
(f)         chest and rib injuries;
(g)  pericarditis;
(h) soft tissue injuries;
(i) abrasions, contusions and bruising;
(j) shock;
(k) pain and suffering;
(l) loss of enjoyment of life;
(m) loss of earnings, both past and prospective;
(n) loss of capital assets;
(o) future cost of care and medical treatment.

[16]        
On June 5, 2009, the plaintiff amended her statement of claim and added
pericarditis to her list of injuries.

[17]        
Counsel for the plaintiff and defendant exchanged a series of offers of
settlement. The defendant refers to them as informal and formal offers.

[18]        
The formal offers were made pursuant to Rule  37B of the old Rules
and its successor, Rule 9-1(1). The informal offers were all made by the
plaintiff. None of them engaged Rule  37B or Rule 9-1(1)(c). As a result, I
will not consider the informal offers.

[19]        
The following offers were made by the defendant and made pursuant to
Rule  37B and 9-1:

·      
December 23, 2008 – defendant served formal offer to settle for
$22,000.00;

·      
February 9, 2010 – defendant served formal offer to settle for
$35,001.00;

·      
November 8, 2010 – defendant served formal offer to settle for
$50,000.00;

·      
November 29, 2010 – defendant served formal offer to settle for
$62,500.00.

[20]        
The submissions made by the plaintiff and defendant raise the issue as
to whether the Court should consider all formal offers to settle, or in this
case, the last one made by the defendant on November 29, 2010.

Analysis

[21]        
The starting point is the Negligence Act. The jury apportioned
fault between the plaintiff and the defendant. The costs are apportioned in
accordance with the same percentage of fault found by the jury. The default
position is s. 3(1) of the Negligence Act.

[22]        
When considering the Negligence Act together the Rules,
and in particular Rule 9-1 and its affect on costs, the Negligence Act
is considered first as it is superior legislation to the Rules: Dodge
v. Shaw Cablesystems Ltd., 2009 BCSC 1765.

[23]        
Rule 9-1 comes into play when an offer is made pursuant to this rule,
and the form of offer meets the criteria set out in Rule 9-1(1)(c). In this
case, there is no dispute that the “formal offers” met the criteria set out in
Rule 9-1(1)(c).

[24]        
Had an offer not been made pursuant to Rule 9-1, the plaintiff in this
case would have been awarded 55% of her costs and disbursements; the defendant
would not have been awarded any of its costs, as the defendant had no claim
before the Court. However, over a period of two years, offers were made pursuant
to Rule 9-1. As a result, the Court may consider an offer that was made to the plaintiff.

[25]        
In exercising its discretion, the Court may order costs in one or more
of the possibilities set out in subrule (5) of Rule 9-1. In exercising its
discretion, the Court may consider the factors set out in subrule (6) of Rule
9-1.

[26]        
In considering subrule (5) of Rule 9-1, the Court may deprive a party of
its costs to which it is entitled. This means in this case that despite s. 3(1)
of the Negligence Act, I could rule that the plaintiff is not entitled
to 55% of her costs and disbursements [subrule (5)(a)]. I could order double
costs for all the steps taken after the offer was delivered under subrule (5)(b)
of Rule 9-1. The defendant is not seeking double costs. The Court may award
costs in respect of all or some of the steps taken after the delivery of the
offer to which the party would have been entitled had the offer not been made
[subrule (5)(c)]. Lastly, the Court may award costs if the defendant made an
offer that is equal or greater than the judgment granted by the Court. The
Court may award the defendant its costs for all or some of the steps taken in
the litigation that the defendant took after the offer was delivered.

[27]        
In considering these choices, the Court may consider the factors set out
in subrule (6) of Rule 9-1. The Court may analyze whether the litigant ought to
have accepted the offer; consider the final judgment as against the offer;
consider the financial circumstances of the litigants; and finally, any other
factors that may be appropriate for the Court to consider.

[28]        
However, before I consider subrules (5) and (6) of Rule 9-1, there is
the issue that is raised in this matter, which is, whether I may consider all
offers that have been made pursuant to Rule 9-1(1)(c), or should I only
consider the last offer made by the defendant?

[29]        
The last offer made by the defendant was made about a week before this
jury trial started. The three previous offers were specifically revoked. As
each offer was made, the previous offer was not capable of acceptance. The
defendant argues that I ought to consider the previous offers of settlement
which were specifically revoked. The defendant relies on Insurance Corp. of
British Columbia v. Patko, 2009 BCSC 578 to support his position.

[30]        
The plaintiff argues that the defendant’s previous offers under Rule 9-1
should not be considered. To support her position, the plaintiff relies on Oliver
v. Moen, 2009 BCSC 874.

[31]        
In Patko, Mr. Justice Grauer stated:

[34] The first question is whether I am limited to
considering the second offer to settle, given that the first was revoked a year
after it was made.

[35] In my view, there is nothing in Rule 37B that would
place that limitation on my discretion. Notwithstanding the evolution of the
treatment of offers to settle in the Rules, it is clear that one of the
principal purposes of Rule 37B remains the same as that noted of the former
Rule 37 by Cumming J.A. in Skidmore v. Blackmore (1995), 2 B.C.L.R. (3d)
201, 122 D.L.R. (4th) 330 (C.A.):

… to encourage conduct that reduces the duration and
expense of litigation, and to discourage conduct that has the opposite effect.

[36] Both offers
constitute an "offer to settle" within the meaning of Rule 37B(1)(a).
Although the first offer was indeed revoked, it was outstanding for a full
year. The real question is whether, notwithstanding its eventual withdrawal, it
was an offer that ought reasonably to have been accepted while it remained
open. To treat it this way is, in my view, consistent with the object described
by Cumming J.A. in Skidmore.

[32]        
In Oliver, Mr. Justice Joyce concluded:

[14] As the defendant’s offer was no longer in existence and
therefore no longer capable of acceptance it cannot be considered under Rule
37B when deciding the issue of costs. This may seem a harsh result but it is
one that, in my opinion, follows from the failure to preserve the saving effect
of the former Rule 37(10) in Rule 37B.

[15] The defendant submits that More
Marine is distinguishable because in that case the offer in question was
made under Rule 37B whereas the defendant’s offer in this case was made under
Rule 37 and at a time when the saving provision of Rule 37(10) was in effect.
It is my view, however, that one must consider the law as it was when the counteroffer
was made on January 30, 2009. At that time there was no enactment in place to
alter the common law principle that the defendant had to revive his offer in
order to give it effect once again.

[33]        
Patko was not drawn to the attention of Mr. Justice Joyce. Patko
was decided on either April 9 or April 29, 2009; Oliver was decided on
June 4 or June 30, 2009.

[34]        
I will follow Patko.

[35]        
The plaintiff commenced this litigation by issuing her writ and
statement of claim on July 18, 2008. The statement of claim was amended on June
5, 2009.

[36]        
Despite the apparently severe injuries that the plaintiff alleges she
suffered as a result of the accident, the plaintiff presented no medical
evidence to the jury to support these claims. This is despite the evidence
before the jury that the plaintiff had seen a number of doctors, both general
practitioners and specialists. Their opinions were not before the court. Before
the jury were the opinions of Drs. Farrell and Apel. These doctors examined the
plaintiff on behalf of the defendant.

[37]        
In January of 2009, the plaintiff’s cardiologist, Dr. Baker, determined:

… “I suspect the most likely
cause of her pericarditis was viral. She did ask about a MVA a year and a half
ago but I explained to her that if it was recent trauma it could be associated
with pericarditis but with remote trauma like that, I would not suspect there
to be a relationship.”

[38]        
In March of 2007, Dr. Farrell, an orthopaedic surgeon, opined in writing
that the plaintiff would have no long-term sequelae and she would not miss any
further work. This opinion was delivered to the plaintiff on March 26, 2010.

[39]        
Despite Dr. Baker’s opinion, the plaintiff pursued an amendment to her
statement of claim on June 5, 2009.

[40]        
On February 9, 2010, the defendant withdrew the first offer of
$22,000.00, and delivered to the plaintiff a further offer pursuant to Rule 9-1
in the amount of $35,001.00.

[41]        
On July 16, 2010, the defendant delivered two reports from Dr. Apel, a
physiatrist, who concluded that the medical complaints of the plaintiff related
to an inflammatory condition which she stated was not related to the accident.

[42]        
It is not the obligation of the defence to disprove the plaintiff’s
injuries. It is the obligation of the plaintiff to prove the injuries she
suffered in the accident.

[43]        
After Dr. Apel’s report was delivered, the defendant delivered two more
offers: one on November 8, 2010 for $50,000.00 and the last one on November 29,
2010 for $62,500.00.

[44]        
Although the plaintiff and the defendant both filed jury notices, it was
the plaintiff who pursued the trial by jury by paying the jury fees.

[45]        
It appears that with the ever-increasing offers made by the defendant,
the defendant wished to resolve this matter knowing at the time the last two
offers were made that the plaintiff had not served the defendant with any
expert medical reports supporting her alleged injuries.

Rule 9-1(6)(a) of the Rules

[46]        
Examinations for discovery were completed by July 2010.

[47]        
By the end of January 2009, the plaintiff was aware she lacked the
evidence linking the accident with the onset of pericarditis. By July of 2010,
the plaintiff was aware that the defendant had medical evidence that most of
her other complaints were not linked to the motor vehicle accident.

[48]        
I am of the view that the first offer, the one made December 23, 2008,
ought to have been reasonably accepted, at least by June of 2009. By June of
2009, the plaintiff could have had a reasonable opportunity to seek another
opinion as to the origin of her pericarditis as it related to the motor vehicle
accident.

[49]        
There was an opportunity to accept the defendant’s last offer of
$65,000.00 just before trial. At this time, both the plaintiff and the
defendant knew the plaintiff had no medical evidence to support her alleged
injuries and medical conditions.

Rule 9-1(6)(b)

[50]        
The final judgment was substantially less than the offers presented by
the defendant to the plaintiff. The jury assessed damages in the amount of
$7,600.00. This is before discounting the amount for liability. The plaintiff
gambled that she could go before the jury without medical evidence and be
awarded amounts larger than any of the offers made by the defendant.

Rule 9-1(6)(c)

[51]        
There is no evidence as to the defendant’s financial circumstances. I
believe it is safe to assume that the defendant was covered by an insurer.

[52]        
On the other hand, the plaintiff’s financial condition is modest. At the
time of trial, this Aboriginal woman was not employed. Throughout most of her
adult life she was employed. At the time of trial, she was attending
university. She owns a residence on the Simpcw First Nation Reserve. She also
owns an automobile.

[53]        
At the time of trial, she was engaged to be married. Her fiancé is
employed. The plaintiff has health problems that at times are physically debilitating.

Rule 9-1(6)(d)

[54]        
I appreciate that the plaintiff’s health problems, from which the
plaintiff suffered initially, might have caused a reasonable person to link
them to the motor vehicle accident. However, upon learning that they were not
linked to the motor vehicle accident, common sense should have caused the
plaintiff to consider her chances of beating any of the offers put to her by
the defendant.

Lump Sum Costs

[55]        
I see no reason to award lump sum costs.

[56]        
Firstly, I do not know all the steps taken in this litigation, and
secondly, there is no evidence before me of the disbursements incurred by the
plaintiff and the defendant other than the hearing date fees.

[57]        
The plaintiff will have 55% of her costs up to and including June 30,
2009. The defendant will have 100% of its costs commencing July 1, 2009. Costs
include disbursements: Kendall v. Hunt, 16 B.C.L.R. 295. As a result, so
long as the defendant paid the daily court fees after July 1, 2009, he is
entitled to this disbursement.

[58]        
The costs awarded are in accordance with Appendix B, Scale B.

[59]        
I order that the plaintiff and defendant each pay their costs of this
application relating to costs.

“H.C. Hyslop J.”

HYSLOP J.