IN THE SUPREME
COURT OF BRITISH COLUMBIA

Date: 20120605

Docket: M041578

Registry:
Vancouver

Between:

Randy Bakker

Plaintiff

And

Harry Jacob Nahanee,
Roselle Ang and

General Motors
Acceptance Corporation

Defendants

Before:
The Honourable Madam Justice Fitzpatrick

Reasons for Judgment

Introduction

[1]            
The plaintiff Randy Bakker, an on-duty police officer, was injured in an
accident involving a motor vehicle driven by the defendant Harry Nahanee. The
vehicle was leased by the defendant Roselle Ang from the defendant General
Motors Acceptance Corporation (GMAC). Mr. Nahanee had stolen that vehicle
from Ms. Ang.

[2]            
The litigation that ensued to address Mr. Bakker’s injuries was
long and convoluted. At the end of the day, the action was dismissed as against
Ms. Ang and GMAC and costs were ordered to be paid to them by Mr. Bakker.
The claim against Mr. Nahanee was subsequently settled.

[3]            
The Supreme Court Civil Rules provide that a plaintiff may seek
an order that he be allowed to claim the costs payable by him to a successful
defendant as a disbursement in the assessment of costs payable to him by an
unsuccessful defendant. Such an order is known as a Bullock order.

[4]            
The only remaining issue in this action is to address whether the costs
assessed against Mr. Bakker in favour of Ms. Ang and GMAC can be
recovered by him as against Mr. Nahanee pursuant to such a Bullock order.

Factual Background

[5]            
The accident in question occurred on May 6, 2002.

[6]            
Mr. Bakker was an on-duty police officer seeking to apprehend Mr. Nahanee,
whom he suspected was operating a stolen vehicle. In the process of attempting
to stop and apprehend Mr. Nahanee, Mr. Bakker’s police cruiser was
struck twice by the vehicle Mr. Nahanee was driving. Mr. Bakker was
injured as a result.

[7]            
There appeared to be little doubt to all concerned that the vehicle had
been stolen by Mr. Nahanee. The police reports filed at the time confirm
that Mr. Bakker was in pursuit of what he believed to be a stolen car. Mr. Bakker’s
own report dated May 7, 2002 confirms this. Mr. Bakker also stated the
accident occurred when Mr. Nahanee, while trying to stop the vehicle,
fumbled with the brakes and gearshift. Mr. Bakker’s later statement to
ICBC on August 16, 2002 similarly described the vehicle as being stolen.

[8]            
On May 6, 2002, Ms. Ang gave a detailed statement to the police
confirming that her vehicle had been stolen. She indicated that she had not
given anyone, let alone Mr. Nahanee, her permissions to take or use the
vehicle.

[9]            
Mr. Bakker’s counsel, Mr. Cameron, was alive to the issue of Ms. Ang
and GMAC’s liability in light of Mr. Nahanee’s presumed theft of the
vehicle. Even before the litigation was commenced, on March 5, 2003, Mr. Cameron
wrote to ICBC referring to this likely being an uninsured motorist claim (since
Mr. Nahanee was not insured) and asking for ICBC’s position regarding
liability. There is no indication that ICBC or its counsel responded.

[10]        
Mr. Bakker commenced this action on April 19, 2004. The named
defendants included Mr. Nahanee, Ms. Ang and GMAC. The claims against
Mr. Nahanee were based on negligent operation of the stolen vehicle. The
claims against Ms. Ang and GMAC were based firstly, upon their statutory
vicarious liability as the respective lessee and lessor of the vehicle pursuant
to section 86 of the Motor Vehicle Act, R.S.B.C. 1996, c. 318 and
secondly, on the allegation of negligence arising from a possible
failure to ensure that the vehicle was mechanically sound. Essentially, this
last allegation was that the vehicle’s brakes had been defective and this
defect had, in some fashion, caused the accident when Mr. Nahanee tried to
stop the vehicle.

[11]        
As Ms. Ang and GMAC were insured with ICBC, a Statement of Defence
was filed by counsel on September 20, 2004. The substance of the defence was a
denial of all allegations, which strangely would have even included a denial of
the allegation that Ms. Ang and GMAC were the lessee and lessor of the
vehicle. There are also allegations of contributory negligence on the part of Mr. Bakker.
Finally, there are allegations that Mr. Bakker’s injuries were not caused
by the accident and that he failed to mitigate any damages.

[12]        
Ms. Ang and GMAC specifically pled that Mr. Nahanee acquired
possession of the vehicle without the consent, express or implied, of them.

[13]        
Mr. Nahanee was not insured through ICBC and was a minor at the
time of the accident. Accordingly, the Public Trustee and Guardian became
involved. They hired counsel for Mr. Nahanee (Mr. Joseph Battista) who
filed an Appearance and Statement of Defence in January 2005.

[14]        
In a further attempt to engage counsel on the matter of liability, on
January 24, 2005, Mr. Cameron forwarded a letter to Mr. Battista stating
“I was also wondering whether you might canvass with your client the issue of
liability so that we can see about releasing the owner of the stolen vehicle
and thereby limit associated costs”.

[15]        
I am not aware that Mr. Battista ever responded to this letter from
Mr. Cameron on the liability issues.

[16]        
Despite Mr. Cameron’s attempt to resolve the liability issues, both
with ICBC and Mr. Battista, the litigation continued, mostly involving
ICBC’s counsel on behalf of Ms. Ang and GMAC.

[17]        
Following the filing of their defence, Ms. Ang and GMAC’s counsel
took substantial steps to address the litigation. However, these steps did not
include addressing the substance of their defence (ie. that the vehicle was
stolen and that there was no negligent maintenance of the vehicle). Instead,
those efforts focused on the merits of Mr. Bakker’s claim. On September
28, 2004, they demanded production of documents, including clinical records.

[18]        
Efforts to obtain document production by ICBC’s counsel continued well
into 2006 along with efforts to examine Mr. Bakker for discovery. For
example, on February 7, 2006, ICBC’s counsel again requested and obtained substantial
documentation from Mr. Bakker relating to his injuries arising from the
accident. In March 2006, ICBC’s counsel conducted an examination for discovery
of Mr. Bakker, with substantial emphasis on the injuries sustained by Mr. Bakker.
Following this discovery, ICBC’s counsel continued their request for documents
relating to Mr. Bakker’s injuries and treatment into July 2006.

[19]        
In the midst of these pre-trial procedures, Mr. Cameron again tried
to engage ICBC’s counsel on the matter of liability, stating in a letter dated
May 8, 2006 “we have yet to work out who is actually leading the charge for the
defence (i.e.: ICBC or counsel for Nahanee)”. Again, there does not appear to
have been any substantial response from ICBC.

[20]        
In September 2006, counsel for ICBC delivered to Mr. Cameron an
Offer to Settle in relation to Mr. Bakker’s claims against Ms. Ang
and GMAC in the amount of $5,000 and costs in accordance with the former Supreme
Court Rules. Despite ICBC’s written argument on this application that this
was a “nominal” offer only which did not recognize any “real liability” on the
part of Ms. Ang and GMAC, ICBC’s counsel was unable to say why such an
offer would have been made in the face of ICBC’s knowledge that the vehicle had
been stolen and presumably their contention that there had been proper
maintenance of the vehicle, such that Ms. Ang and GMAC were not liable for
the accident.

[21]        
To this point in time, Mr. Nahanee’s only involvement in the action
had been the filing of his statement of defence.

[22]        
Seven months after delivering the Offer to Settle, ICBC communicated to Mr. Cameron
that they had “new instructions”. It appears that ICBC and its counsel finally
realized that Ms. Ang and GMAC did have a substantive defence based on the
fact that the vehicle was stolen. On April 24, 2007, ICBC’s counsel advised Mr. Cameron
that their position was that the vehicle was stolen and that Ms. Ang and
GMAC had no vicarious liability as a result. Accordingly, they withdrew the
Offer to Settle and indicated that they would seek a dismissal of Mr. Bakker’s
action if it was not discontinued.

[23]        
This was the response that Mr. Cameron had been seeking for some
years now since even shortly before the litigation was commenced. He quite
reasonably agreed that Ms. Ang and GMAC were likely not vicariously liable
since the vehicle was stolen. He also agreed that he could likely discontinue
the action against Ms. Ang and GMAC once he completed certain due
diligence in respect of the mechanical state of the vehicle. Accordingly, an
examination for discovery of Ms. Ang took place on September 20, 2007 at
which time her evidence confirmed that she had not been complicit in respect of
Mr. Nahanee’s possession or use of the vehicle. She also confirmed at that
time that the vehicle had been maintained properly.

[24]        
Mr. Cameron agreed at the conclusion of the examination for
discovery that it was appropriate to discontinue the action as against Ms. Ang
and GMAC, however, he was only prepared to do so if each party bore their costs
or if the costs would be assessed as amongst all parties at the conclusion of
the litigation as against Mr. Nahanee.

[25]        
ICBC disagreed and brought an application to dismiss the action pursuant
to then Supreme Court Rule 18A. They also sought costs. Ms. Ang’s
affidavit was filed in support. At the hearing, Mr. Cameron consented to
the action being dismissed as against Ms. Ang and GMAC but argued that the
issue of costs as between the parties should be determined at the end of the
action when the Court could potentially consider either a Bullock or Sanderson
order. Mr. Battista, counsel for Mr. Nahanee, took no position on the
costs issue, but advised the Court at the hearing that although liability had
been denied in the pleadings, Mr. Nahanee did not, in fact, have a viable
defence.

[26]        
On October 19, 2007, Mr. Justice Goepel dismissed the action as
against Ms. Ang and GMAC. He ordered that the costs of Ms. Ang and
GMAC were payable by Mr. Bakker now, disagreeing with Mr. Cameron’s
position that the issue should be decided at the end of the litigation. He
declined to deal with the issue as to whether a Bullock or Sanderson
order was appropriate, noting that the matter was premature in any event since Mr. Nahanee
had not yet been found liable. Hence, at that time, there was no “unsuccessful”
defendant against whom costs could be awarded. Accordingly, since the costs
were to be paid by Mr. Bakker forthwith, he ordered that the issue of
recovery by Mr. Bakker of those costs from Mr. Nahanee would be dealt
with at the conclusion of the proceedings against Mr. Nahanee. Leave to
appeal this decision was denied: Bakker v. Nahanee, 2008 BCCA 12.

[27]        
The costs of Ms. Ang and GMAC were assessed on March 27, 2008 in
the amount of $10,392. These were paid by Mr. Bakker and this represents
the amount he seeks to recover from Mr. Nahanee under a Bullock
order.

[28]        
With the action against Ms. Ang and GMAC having been resolved, Mr. Bakker
then turned his sights back to Mr. Nahanee, who was still represented by Mr. Battista
and not ICBC. The strategy was to involve ICBC in the action against Mr. Nahanee
since he was an uninsured motorist.

[29]        
On October 14, 2007, Mr. Cameron wrote to ICBC to indicate that Mr. Bakker
would be invoking the uninsured motorist provisions under the applicable
legislation so as to pursue ICBC if judgment was obtained against Mr. Nahanee.
The necessary Statutory Declaration to invoke those procedures had been
provided to ICBC earlier in November 2002. Those provisions essentially allow
ICBC to step in and defend such an action but only in the event that an
uninsured motorist defaults in complying with the procedures in the litigation
(for example, failing to file an appearance or defence, failing to appear at
the trial or doing or failing to do anything that entitles a claimant to take
default proceedings): Insurance (Vehicle) Act, R.S.B.C. 1996, c. 231,
s. 20(6).

[30]        
In response, ICBC hired counsel (not the same counsel who acted for Ms. Ang
and GMAC) to deal with the matter in early 2008. What followed was a convoluted
discussion between Mr. Cameron, Mr. Battista and this new counsel as
to whether or not a “default” had occurred that allowed ICBC to step in. In
February 2008, Mr. Nahanee was declared incapable of handling his
financial and legal affairs and a Certificate of Incapability was obtained. He
continued thereafter to be represented by Mr. Battista on behalf of the
Public Trustee and Guardian.

[31]        
Eventually, after noting that Mr. Nahanee had failed to show up for
two examinations for discovery, Mr. Bakker brought an application on
August 8, 2008 to allow him to proceed as against Mr. Nahanee as if no
defence had been filed. That order was granted by Mr. Justice Brooke on
that date and a copy was provided to ICBC shortly thereafter.

[32]        
ICBC then immediately became formally involved in the litigation. They
filed an appearance and defence in September 2008 for Mr. Nahanee. They
also sought an adjournment of the then scheduled trial. They examined Mr. Bakker
in April 2009.

[33]        
Later still, it appears that ICBC considered that the Order of Brooke J.
may not in fact have allowed them to act on behalf of Mr. Nahanee. In that
event, they believed that if Mr. Nahanee had not in fact been in default
(despite the August 8, 2008 order), their taking steps in the litigation would
arguably vitiate ICBC’s statutory ability to secure reimbursement from Mr. Nahanee
for any monies paid by ICBC on an uninsured claim to Mr. Bakker.

[34]        
As a result, on September 18, 2009, ICBC obtained a further order from
Brooke J. setting aside his previous order. Mr. Battista did not appear or
take any position on this application.

[35]        
ICBC now says that as a result, ICBC’s standing to act in the place of Mr. Nahanee
ended after that one year period and again, it had no status in the litigation
effective September 2009.

[36]        
In August 2010, Mr. Battista filed a notice withdrawing Mr. Nahanee’s
statement of defence, in a further attempt to trigger a “default” and cause
ICBC to take up the defence of Mr. Nahanee. This ultimately led to a
further application by Mr. Bakker for an order that Mr. Nahanee was
in default of his pleadings. That order was granted by Master Taylor on
December 2, 2010.

[37]        
As such, ICBC again took the position that it was allowed to take up Mr. Nahanee’s
defence and they filed a Response to Civil Claim on his behalf on December 13,
2010.

[38]        
On November 2, 2011, Mr. Bakker delivered an Offer to Settle to
ICBC pursuant to Supreme Court Civil Rule 9-1 in the amount of $40,000 plus
costs and disbursements. The offer included the following provision:

This settlement does not remove
the right of the Plaintiff to apply to apply for an order against the
Defendants Nahanee for reimbursement for costs previously paid by the Plaintiff
to the Defendants Roselle Ang and General Motors Acceptance Corporation in this
action nor does it affect the Defendant Nahanee’s right to contest that application.

[39]        
On December 6, 2011, ICBC accepted this offer on behalf of Mr. Nahanee,
specifically noting their ability to contest any application for a Bullock
order.

Discussion and Analysis

[40]        
Supreme Court Civil Rule 14-1 (18) provides that the Court may exercise
its discretion in ordering that the costs of one defendant be paid by another
defendant:

If the costs of one defendant
against a plaintiff ought to be paid by another defendant, the court may order
payment to be made by one defendant to the other directly, or may order the
plaintiff to pay the costs of the successful defendant and allow the plaintiff
to include those costs as a disbursement in the costs payable to the plaintiff
by the unsuccessful defendant.

[41]        
An order may be granted that an unsuccessful defendant pay the costs of
the successful defendant directly (a Sanderson order).
Alternatively, the order may provide that the plaintiff, while having to pay
the successful defendant’s costs, is allowed to claim the amount paid as a
disbursement in the assessment of costs against an unsuccessful defendant (a Bullock
order).

[42]        
Mr. Bakker seeks a Bullock order against Mr. Nahanee in
respect of the costs he has paid to Ms. Ang and GMAC.

[43]        
In Robertson v. North Island College Technical & Vocational Institute
(1980), 26 B.C.L.R. 225 at 227 (C.A.), the Court discussed both Bullock
and Sanderson orders:

The rule that one defendant may be required to pay the costs
of another defendant, or to pay to the plaintiff the costs that the plaintiff
is required to pay to the other defendant, has its origins in the Courts of
Chancery. The modern formulation of the rule stems from two decisions of the
English Court of Appeal, namely, Sanderson v. Blythe Theatre Co., [1903]
2 K.B. 533 (C.A.),and Bullock v. London General Omnibus Co., [1907] 1
K.B. 264 (C.A.). Those cases establish that the rule is applicable in common
law cases.

….

The Sanderson and Bullock cases show that the
rule is a rule relating to the exercise of the trial judge’s discretion on a
matter of costs. It is no different from any other matter of costs. It is
inappropriate that the discretion should be whittled away by drawing fine
points of comparison between one case and another, and creating a set of legal
principles that in the end prevent trial judges from exercising the discretion
that they are intended to have over matters of costs.

There is a threshold question. It is expressed by Vaughan
Williams L.J. in Besterman (Bestermann) v. British Motor Cab Co. Ltd.,
[1914] 3 K.B. 181 (C.A.), a decision of the English Court of Appeal, at
p. 186, in this way:

Under these circumstances, was it a
reasonable thing for the plaintiff in his action against a man who ultimately
turns out to be in fact the wrong-doer to join the other defendant in order
that the matter might be thoroughly threshed out?

….

Once the threshold question is
answered affirmatively then the discretion of the trial judge arises. Of
course, he may exercise it either way. It is a true discretion. Whether he
grants a Bullock order, or not, must depend on his assessment of the
circumstances of the case. In my opinion it is inappropriate to trammel that
discretion by endeavouring to extract principles from those cases where the
discretion was exercised and from those cases where it was refused. The
threshold question must be answered affirmatively; the discretion must be
exercised judicially; and that is all.

[44]        
In Grassi v. WIC Radio Ltd., 2001 BCCA 376, Madam Justice Southin
provided some clarification as to when such orders may be appropriate:

[33]      I do not go so far, as some of the cases have
suggested, as to say that such an order should be made “whenever it was
reasonable for the plaintiff to have sued the successful defendant”, if, by
“reasonable”, one is looking at the matter from the perspective of counsel for
the plaintiff. One must bear in mind that the present rule as to joinder of
causes of action is so broad that the causes of action alleged against the
various defendants may be completely different, even though they arise out of
the same transaction. … There must be something which the unsuccessful
defendant did, such as asserting the other defendant was the culprit in the
case, to warrant his being made to reimburse the plaintiff for the successful
defendant’s costs….

[34]      But orders under Rule
57(18) are not restricted to cases where the unsuccessful defendant in the
course of the litigation has blamed the successful defendant but may extend to
acts of the unsuccessful defendant which caused the successful defendant to be
brought into the litigation.

[45]        
Recently in Davidson v. Tahtsa Timber Ltd., 2010 BCCA 528, the
Court affirmed the principles from both Robertson and Grassi,
stating that a Bullock order requires “some conduct” on the part of the
unsuccessful defendant to justify the award: Davidson at para. 54.

(i)   Was it reasonable for Mr. Bakker
to have sued Ms. Ang and GMAC?

[46]        
I turn to the threshold question as to whether it was reasonable for Mr. Bakker
to have named Ms. Ang and GMAC as defendants in this litigation.

[47]        
Mr. Bakker submits that in the particular circumstances of this
case, it was reasonable to join them and that in those circumstances, Mr. Nahanee
ought to pay the costs which Mr. Bakker was required to pay to the
successful defendants, Ms. Ang and GMAC. He says in particular:

a.         Mr. Nahanee set in motion the chain of events
that caused Ms. Ang and GMAC to be brought into this action;

b.         It was reasonable for Mr. Bakker to include Ms. Ang
and GMAC in the action to thresh the issues out; and

c.         It is a proper and
prudent practice to name the owner of any motor vehicle at fault for an
accident due to the provisions of the Motor Vehicle Act regarding
vicarious liability of the owner and where the onus is on the owner to disprove
that liability.

[48]        
On a preliminary point, ICBC takes the position that the pleadings of Mr. Bakker
do not set out a cause of action against Ms. Ang and GMAC on the basis of
vicarious liability pursuant to s. 86 of the Motor Vehicle Act. I
have reviewed the pleadings filed by Mr. Cameron and they clearly name Ms. Ang
as the lessee of the vehicle and GMAC as the owner of the vehicle. Why the
cause of action was not as clearly stated in the pleading as it could have
been, in my view the material facts have been plead upon which a finding of
vicarious liability might be made by the Court. In addition, I note that the
many communications from counsel for ICBC acting for Ms. Ang and GMAC to Mr. Cameron
specifically address this aspect of the claim and therefore, there was clearly
no doubt in ICBC’s mind that the claim advanced against Ms. Ang and GMAC
arose at least in part from this potential vicarious liability.

[49]        
Accordingly, I consider the pleadings adequately set out this claim.

[50]        
The causes of action against Mr. Nahanee in negligence in relation
to his operation of the vehicle are independent of the causes of action against
Ms. Ang and GMAC which arise from their statutory liability. In addition,
the allegations that Ms. Ang and GMAC may be liable in negligence in
relation to the maintenance of the vehicle can be said to be independent of the
allegations against Mr. Nahanee. Nevertheless, they all arise from the
operation of the vehicle by Mr. Nahanee and in that sense, can be said to
be connected.

[51]        
Mr. Bakker has submitted and I agree that it is the practice in
this province where a motor vehicle accident has occurred that counsel will sue
all potential parties who may have some liability provided of course that there
is some reasonable basis upon which liability may be established. Mr. Cameron
has referred me to the British Columbia Motor Vehicle Accident Claims
Practice Manual, 2d ed. (The Continuing Legal Education Society of British
Columbia). At §2.12, the authors state:

In general, … anyone whose negligence may have caused or
contributed to the motor vehicle accident should be joined as a defendant
and/or third party.

It is important to canvas
thoroughly who may be a party, no matter how seemingly remove at first glance;
failure to do so may have adverse consequences for the client and ultimately
for the lawyer

[52]        
It is not a novel concept that when preparing pleadings, all parties who
are potentially liable should be included where a valid cause of action can be
reasonably advanced. This applies equally in the arena of motor vehicle
litigation. In this respect, Mr. Bakker also relied on the evidence of Mr. David
Kolb, a Vancouver lawyer who practices in this area. He states that an owner of
the vehicle in question is always named as a defendant arising from the
statutory vicarious liability under the Motor Vehicle Act. He goes on to
state that even if the car was purportedly stolen, it is wise to err on the
side of caution and name all parties until further investigations are done to
ensure that all facts are known before the owner is released from the
litigation. He cites as an example, that while the driver/thief and the owner
may have different names, further investigations may in fact reveal that they
were related and resided together, in which case the owner would be liable even
if a stolen vehicle is involved. There may also be issues of fraud or improper
motive on the part of the owner who reported the vehicle as stolen. Until such
facts as may establish liability are ruled out, it is a prudent practice to
name the owner.

[53]        
In these circumstances, as a general proposition, I am of the view that Mr. Bakker
was reasonable in naming Ms. Ang and GMAC as defendants to this action.

[54]        
ICBC submits, however, that the claim for vicarious liability was doomed
from the start because it was well known to Mr. Bakker that the vehicle
was stolen and that Ms. Ang had nothing to do with it. She also says that Mr. Bakker
had plenty of time prior to commencement of the action to investigate matters
and determine liability rather than naming parties liberally before the
expiration of a pending limitation deadline. Mr. Bakker was represented by
counsel as early as March 2003 and the action was not commenced until April
2004, over a year later. She says that accordingly, there was sufficient time
to determine that it was not appropriate to add Ms. Ang and GMAC.

[55]        
As stated earlier in these reasons, it was the belief of Mr. Bakker
that the car was stolen. However, while Mr. Bakker participated in the police
reporting in the aftermath of the accident, there is no evidence that Mr. Bakker
then fully investigated the matter with Ms. Ang. At no time did he seek to
obtain her evidence with a view to proving that she had no relationship to Mr. Nahanee
and that she had nothing to do with the fact that the vehicle was taken by Mr. Nahanee.
The statements that Ms. Ang gave to both the police and ICBC were given to
other individuals, not Mr. Bakker.

[56]        
I cannot conclude that Mr. Bakker was aware of all the details
concerning the theft of the vehicle and also the previous maintenance history
of the vehicle prior to the accident before the action was commenced. In fact,
I am not aware of any basis upon which to argue that he had the obligation to
fully “investigate” the matter, as ICBC contends. These matters clearly lay
within the knowledge of Ms. Ang and therefore ICBC. There is no
explanation why ICBC did not respond in a substantive manner to Mr. Cameron’s
enquiry on March 5, 2003 regarding the liability issues well before the action
was commenced. While ICBC was not required to address the matter then, and
while they were entitled to later deny liability on behalf of Ms. Ang and
GMAC in the action, in those circumstances I do not see how it lies in their
mouth to contend now that these parties should not have been named.

[57]        
In addition, ICBC submits that the action against Ms. Ang and GMAC was
without any evidence or foundation in respect of the allegation that they had
failed to ensure that the vehicle was mechanically sound. Counsel for ICBC
point to the police investigation done on the date of the accident, including Mr. Bakker’s
own memo regarding the collision referring to Mr. Nahanee, then a teenager
of 14 years old, “fumbling with the brakes and gearshift”.

[58]        
Similar to my conclusions above, I do not consider that Mr. Bakker’s
involvement in the accident resulted in him determining, for the purposes of
this litigation, that the sole reason for the accident arose from Mr. Nahanee’s
operation of the vehicle, rather than a mechanical issue relating to the stolen
car. It is equally plausible at that time that there was some mechanical
problem with the vehicle that had caused or contributed to Mr. Nahanee’s faulty
operation of the vehicle and the subsequent collision. In these circumstances,
it is difficult to fault Mr. Bakker for waiting until this further issue
was resolved before addressing the vicarious liability of Ms. Ang and
GMAC.

[59]        
The simple fact is that Mr. Nahanee stole Ms. Ang’s car. By
doing so, he squarely put in issue whether Ms. Ang and GMAC, as the lessee
and lessor of that vehicle, were vicariously liable in those circumstances. In
that sense, it was his conduct that caused them to be named. In my view, the
causes of action were also related or connected in the sense that the actions
of Mr. Nahanee gave rise to issues not only in relation to himself, but to
Ms. Ang and GMAC. I consider that it was reasonable for Mr. Bakker to
have named Ms. Ang and GMAC so that all potential parties who might be
liable for the accident were brought into the litigation.

[60]        
I therefore find that Mr. Bakker has satisfied the threshold
question.

(ii)     The Exercise of the Court’s Discretion

[61]        
Having met the threshold requirement of showing that joinder was
reasonable, the Court must exercise its judicial discretion in deciding whether
a Bullock order is just and fair in the circumstances.

[62]        
Mr. Cameron advises that in the ordinary course, if the case
involves a stolen vehicle, both the driver and the owner would be named.
Sometime later, ICBC would decide how they wished to deal with the matter which
would typically involve ICBC admitting liability for the thief/uninsured
motorist. At that point, the innocent owner of the vehicle would be “off the
hook” and a discontinuance would be filed by the plaintiff.

[63]        
As stated earlier in these reasons, Mr. Cameron made efforts to
engage both ICBC and Mr. Battista in these types of discussions in March
2003, January 2005 and May 2006. Again, his words to Mr. Battista were
specifically that he should “canvass with [his] client the issue of liability
so that we can see about releasing the owner of the stolen vehicle and thereby
limit associated costs”.

[64]        
Unfortunately, an early discussion of the liability issues relating to
the defendants or even earlier, potential defendants, did not happen in this
case for a variety of reasons.

[65]        
Firstly, ICBC did not have conduct of Mr. Nahanee’s defence and
there does not appear to have been any coordination between Mr. Battista
and ICBC in that respect despite the prospect that ICBC would become involved at
some point pursuant to the uninsured motorist legislation. Secondly, Mr. Battista
in fact defended the action and specifically denied any liability on the part
of Mr. Nahanee. Thirdly, ICBC’s counsel, who no doubt was well aware that Ms. Ang
took the position that her vehicle had been stolen, did not tackle that issue
head on. In fact, even in the face of that knowledge, ICBC’s counsel ignored
her substantive defences and took the rather odd approach of defending the
claim on its merits for the ensuing 3 years. This involved substantial document
disclosure procedures and examining Mr. Bakker. Even more inexplicable is
their Settlement Offer delivered in September 2006 on behalf of Ms. Ang
and GMAC which on the face of it, indicated some concerns regarding liability. Again,
no explanation was offered by ICBC as to why that Offer to Settle was
delivered.

[66]        
ICBC takes the position that the lack of merit in Mr. Bakker’s
claim against Ms. Ang and GMAC was exacerbated by Mr. Bakker’s conduct
in the prosecution of the claim. ICBC says that Mr. Bakker commenced the
action against Ms. Ang and GMAC in April 2004 but that he subsequently made
no effort to ascertain the merits of this claim in any material way until
September 2007 when Ms. Ang was examined for discovery. By this, I take
ICBC to be saying that it was incumbent on Mr. Bakker to take steps to
disprove the vicarious claim against them, a proposition that I find defies
logic. Mr. Bakker’s pleadings made clear that these claims were being advanced
against Ms. Ang and GMAC. In the face of ICBC’s active defence of the
claim on its merits, Mr. Cameron must have reasonably assumed that there
was some substance to these claims. This would have been particularly so given
the delivery of the Offer to Settle, which was presented even before Mr. Cameron
had examined Ms. Ang for discovery on the stolen vehicle and maintenance
issues.

[67]        
ICBC relies on Davidson, at paras. 56 and 57, where the
Court found that it was not just and fair in the circumstances to impose a Bullock
order where there was no credible evidence to support the claim that was later
dismissed and the claim was described as being “without foundation”.

[68]        
In Cominco Ltd. v. Westinghouse Canada Ltd. (1981), 33 B.C.L.R.
202 (S.C.), a much more nuanced approach was taken by the Court in the exercise
of its discretion in awarding a Bullock order. In that case, the Court
held that where a relationship was unclear at the time the action was started,
but was clarified later on discovery such that it was revealed that no claim
could be asserted against one of the parties, a Bullock order was
limited to only those costs up to the time of that discovery: Cominco at
212.

[69]        
Contrary to the contention of ICBC, there was some uncertainty, albeit
minor, as to whether Mr. Nahanee was solely liable for the accident. While
Mr. Bakker did not move particularly quickly in determining that issue, I
conclude that this arose in part due to the contradictory position of ICBC in
defending the claim against Ms. Ang and GMAC on its merits. In addition, I
think it can equally be said that ICBC failed in bringing the issue to the
fore, especially in circumstances where the evidence to prove Ms. Ang’s
innocence regarding the stolen vehicle and her proper maintenance of the
vehicle were entirely in ICBC’s, and not Mr. Bakker’s, control. Once Mr. Cameron
was advised that ICBC was actively asserting this defence, he moved quickly to
examine Ms. Ang for discovery and complete his due diligence on the
issues.

[70]        
Further, ICBC says that Mr. Nahanee should not be required to pay
the costs of Mr. Bakker’s “ill-advised” attempt to secure a Bullock
order against Mr. Nahanee prior to any judgment or settlement against Mr. Nahanee.
She says it was only after the discovery of Ms. Ang that Mr. Bakker
conceded that the claim lacked merit and agreed that the only remaining issue
was costs. Despite that concession, further proceedings before Goepel J. were
necessary to dismiss the action and the Court of Appeal denied his leave
application to appeal the decision to awards costs in favour of Ms. Ang
and GMAC.

[71]        
In my view, there is some merit to this argument. By the time of the
discovery, it was clear to all that there was no basis upon which to base any
liability of Ms. Ang and GMAC. The litigation was at an end in relation to
those defendants. I do not consider that it was reasonable for Mr. Bakker
to proceed to the hearing before Goepel J. particularly in light of the fact it
was clearly premature, as stated by Goepel J. A discontinuance would have been
a far more practical solution with Mr. Cameron putting Mr. Nahanee’s
counsel on notice that he would be seeking a Bullock order in respect of
costs payable in that event. Nor do I consider that it is reasonable for Mr. Nahanee
to incur the costs of Mr. Bakker attempting to appeal the decision of
Goepel J. in an attempt to delay the payment of costs that were ordered payable
by Mr. Bakker.

[72]        
On a final note, both parties made submissions concerning the role that
ICBC played – or did not play – in relation to this litigation.

[73]        
ICBC says that it should not be forced, through Mr. Nahanee, to pay
essentially its own costs incurred defending its insured, Ms. Ang and GMAC,
particularly given that ICBC had no standing in relation to Mr. Nahanee
during the period that these costs were incurred (from 2004 to 2007). ICBC says
that it therefore had no ability to control against the incurring of these
costs as a true co-defendant. I would note, however, that it is normally the
case that the unsuccessful defendants are separately represented from the
successful defendants and in that sense, have no “control” over the costs
incurred by the successful defendants.

[74]        
Mr. Bakker says the entity behind all these defendants, being Mr. Nahanee,
Ms. Ang and GMAC, is the same. Therefore the steps undertaken on behalf of
Ms. Ang and GMAC in defending the action on its merits (such as reviewing document
disclosure and examining Mr. Bakker) ultimately led to a knowledge of Mr. Bakker’s
case which assisted ICBC, acting for Mr. Nahanee, in arriving at a
settlement of the action. Accordingly, Mr. Bakker submits that there is
really no independent "successful defendant" to whom Mr. Bakker should,
in these circumstances, pay costs.

[75]        
Needless to say, ICBC’s involvement in this litigation has been as the
statutory insurer of the parties. It has acted in that role in the name of the
defendants in this litigation. The decisions of the Court in relation to these
defendants affect those defendants, even though financially ICBC bears the cost
of those decisions. In those circumstances, I do not consider it particularly
relevant that ICBC had various roles to play and that the practical result of any
Bullock order is to order ICBC to pay itself. Practically, that is what
occurs but it happens under the insurance of different parties and the result is
or may be of significance to them.

[76]        
In Brooks-Martin v. Martin, 2011 BCSC 497, Mr. Justice
Halfyard similarly did not find it of significance that both defendants were
separately represented by the same insurer: para. 27.

Conclusion

[77]        
In my view, and exercising my discretion, the granting of a Bullock
order is appropriate in the circumstances but the order should be limited, similar
to that which was ordered in Cominco at 212. Accordingly, Mr. Bakker
is entitled to a Bullock order but only in respect of the costs incurred
up to and including the examination for discovery of Ms. Ang on September
20, 2007. By that time, Mr. Bakker’s counsel had elicited sufficient
evidence from Ms. Ang to be satisfied that she and GMAC had no vicarious
liability and that there were no mechanical issues relating to the vehicle. Beyond
September 20, 2007, I am unable to say that it would be just or fair to fix Mr. Nahanee
with the costs of Ms. Ang and GMAC.

[78]        
Given that Mr. Bakker has been substantially successful, he is
entitled to the costs of the application.

“The
Honourable Madam Justice S.C. Fitzpatrick”