IN THE SUPREME COURT OF BRITISH COLUMBIA

Date: 20121105

Docket: M084569

Registry:
Vancouver

Between:

Nick Varga

Plaintiff

And

Hyun Soo Shin
Hyo Nam Shin

Defendants

Before:
Registrar Sainty

Reasons for Decision

[1]            
The parties came before me on September 27, 2012 to assess the
plaintiff’s costs of this action.

[2]            
At the hearing counsel advised that only a few small issues were in
dispute:

(a)      In respect of the tariff items claimed:

i.        whether the plaintiff’s costs ought to be
restricted to costs available under R. 15-1(15) of the Supreme Court Civil
Rules (the “Rules”), the matter having settled for less than
$100,000;

ii.        if the plaintiff is entitled to “regular” tariff
costs, whether he ought to be entitled to claim Items 45 and 46 (for
preparation for and attendance at a mediation) at all or at more than the
half-day rate; and

(b)      In respect of the disbursements claimed:

i.        the reasonableness of the amounts claimed for
couriers and photocopying; and

ii.        the necessity and propriety of incurring the
costs of a report by Dr. Travlos dated September 21, 2011 (the “Travlos
Report”) (costing $2,912.50), a functional capacity report by Ultima Health
Assessments (in the amount of $1,950) and, lastly, a second report of Dr.
Fuller (at a cost of $2,500).

[3]            
I will commence by providing a brief summary of the salient facts of
this matter.

[4]            
The plaintiff was injured in a motor vehicle accident on November 28,
2006. He commenced this action on October 15, 2008. At the time of the
accident, the plaintiff was working as a commercial glazier (high rise window
installer). He had a pre-existing degenerative spinal condition known as
spondylolisthesis. The accident caused this condition to become symptomatic.

[5]            
Liability was in issue in the action.

[6]            
The plaintiff issued a notice to mediate on July 8, 2009. On September
22, 2009, plaintiff’s counsel sent a demand to the defendants’ insurer (the
Insurance Corporation of British Columbia) claiming damages of $422,233.24,
broken down as:

Non-pecuniary damages:                   $125,000
Past Wage loss:                                  $22,233.64
(as reported by the plaintiff’s father by whom he is employed)
Loss of capacity/future income loss:   $250,000
Cost of Future Care:                            $25,000

[7]            
The parties attended a mediation on December 21, 2009. The action did
not settle. The defendants’ offer at mediation was $40,000 plus taxable costs
and disbursements. The defendants issued a formal offer in that amount on May
19, 2011.

[8]            
About one year post-accident, the plaintiff was working in a managerial
capacity (as a foreman glazier) and was earning approximately double the income
he earned at the time of the accident.

[9]            
A notice of trial was filed February 2, 2011 and the action was set for
5 days of trial commencing August 13, 2012.

[10]        
The plaintiff was in a second motor vehicle accident on October 31,
2011.

[11]        
On June 14, 2012, the plaintiff made a settlement proposal in the amount
of $232,433.64 plus taxable costs and disbursements. Examinations for discovery
were conducted the day the proposal was made.

[12]        
The parties exchanged trial briefs in July 2012 and attended a trial
management conference on July 17 (before Master Scarth). At the trial
management conference, it was confirmed that the trial of the action would take
(at least) 5 days.

[13]        
On July 19, 2012, the plaintiff accepted a settlement offer from the
defendants of $65,000 (“new money”), with costs to be assessed or agreed. The
parties have been unable to agree on the costs thus necessitating this
assessment.

[14]        
I will start with the most contentious matter — the plaintiff’s right
to claim “regular” costs rather than costs per R. 15-1(15) of the Rules.

[15]        
R. 15-1 of the Rules deals with “Fast Track Litigation”. It
says:

(1)        Subject to subrule (4) and unless the court
otherwise orders, this rule applies to an action if

(a)        the only claims in the action are for one or more
of money, real property, a builder’s lien and personal property and the total
of the following amounts is $100,000 or less, exclusive of interest and costs:

(i)         the amount of any money claimed in the action by
the plaintiff for pecuniary loss;

(ii)        the amount of any money to be claimed in the
action by the plaintiff for non-pecuniary loss;

(iii)       the fair market value, as at the date the action
is commenced, of

(A)       all real property and all interests in real
property, and

(B)       all personal property and all interests in
personal property

claimed in the action by the plaintiff,

(b)        the trial of the action can be completed within 3
days,

(c)        the parties to the action consent, or

(d)        the court, on its own motion or on the
application of any party, so orders.

[16]        
Ms Taylor submits that this Rule ought to apply to this action as it
settled for less than $100,000 and thus it should attract the costs
consequences of R. 15-1(15). The Rule she argues ought to be read not as
inclusive, but rather as exclusive, meaning that if any one of (a) through (d)
of R. 15-1(1) applies to the action, so too the costs provisions of the Rule
ought to apply. Here the matter settled for less than $100,000 and thus, argues
Ms Taylor, R. 15-1(1)(a) is operative and applies to this action,
regardless of the fact that the action was set for a 5 day trial.

[17]        
Ms Taylor also argues that counsel for the plaintiff early on in this
action ought to have realised that this matter was not worth any more than
$100,000 and that it was, in essence, a “fast track” action. In keeping with
proportionality, Ms Taylor says that R. 15-1 (and, specifically, the costs
provisions set out in subrule (15) of that Rule) ought to apply to this action.

[18]        
Finally, Ms Taylor relies on R. 14-1(1)(f) and says that R. 15-1(15)
should apply to this action regardless of whether the action itself was formally
fast tracked. That Rule says:

(1)        If costs are payable to a party under these
Supreme Court Civil Rules or by order, those costs must be assessed as party
and party costs in accordance with Appendix B unless any of the following
circumstances exist:

(f)         subject to subrule (10) of this rule,

(i)         the only relief granted in the action is one or
more of money, real property, a builder’s lien and personal property and the
plaintiff recovers a judgment in which the total value of the relief granted is
$100,000 or less, exclusive of interest and costs, or

(ii)        the trial of the action was completed within 3
days or less,

in which event, Rule 15-1 (15) to (17) applies to the action
unless the court orders otherwise.

[19]        
In support of this submission Ms Taylor cites Axten v. Johnson,
2011 BCSC 1005 [Axten]. In that case Ker J. noted (at paragraph 37) that,
where a case is settles for under $100,000, it is subject to R. 15-1 by
virtue of the exceptions found within R. 14-1(1)(f).

[20]        
Mr. Warnett, counsel for the plaintiff disagrees with Ms Taylor’s
submissions. He says that the R. 15-1 ought to be read inclusively, not
exclusively. He says that, to be a “fast track action”, a case must be worth
less than $100,000 and [my emphasis] be a matter that is expected to
require no more than three days of trial. In support of his argument, Mr.
Warnett referred me to a number of cases where a plaintiff recovered less than
$100,000 but was awarded costs at Scale B, including:

(a) Demidas v. Poinen, 2012 BCSC 416 where in a
personal injury action the plaintiff was awarded damages totalling $86,639.36,
plus “costs at Scale B”;

(b) Madsen v. Bekker, 2012 BCSC 112 where, again
in a personal injury action, the plaintiff was awarded his Scale B costs where
damages equalled $71,000; and

(c) Van Hartevelt v. Grewal, 2012 BCSC 658. In
that case, the plaintiff received damages for assault in the amount of $68,500
plus “costs at Scale B”.

[21]        
These cases, Mr. Warnett says, are in keeping with his submissions that
simply because a plaintiff is awarded less than $100,000 at trial or settles
his action for less than that amount, his action does not automatically become
a “fast track” action and subject to the costs provisions in R. 15-1(15). There
must be something more to keep it within the Rule and thus subject to the costs
provisions set out therein (such as a trial of three days or less).

[22]        
In further support of this premise, Mr. Warnett refers me to R. 15-1(14)(a)
which provides that, at a trial management conference, if the presider
considers that the trial will likely require more than three days, the
presider:

(a)        may adjourn the trial
to a date to be fixed as if the action were not subject to this rule. . .

Accordingly says Mr. Warnett, where it is determined at a
trial management conference that a case may take more than three days, the
court, on its own motion, has the discretion to remove the action from the fast
track provisions of the Rules and, in that instance, the case is no
longer subject to the “cap” on costs set out in R. 15-1(15). Therefore, it
must have been the intention of the drafters that the Rule be read inclusively,
and not exclusively as suggested by Ms Taylor.

[23]        
Mr. Warnett also says that the “fast track” rule is optional, not
mandatory in that parties determine when they file their notice of civil claim
whether to file it as a “fast track” action or to simply file a “regular”
notice of civil claim (see R. 15-1(2)(a)). In opting into the Rule parties
opt into its costs provisions and it cannot therefore be the case that those
costs provisions are mandatory for all cases falling within the descriptors set
out in R. 15-1(a) through (d).

[24]        
Counsel noted that the optional nature of the Rule was confirmed by the
Court of Appeal for British Columbia in Majewska v. Partyka, 2010 BCCA
236 when (in determining a costs issue in respect of Rule 66 of the Supreme
Court Rules , the precursor to R. 15-1) the Court of Appeal said:

[33]      This approach brings desirable consistency and
predictability to costs awards following fast track litigation. The varied
approaches that have developed under R. 66 have led to uncertainty with respect
to both exposure to and recovery of costs under the rule. Having opted into the
R. 66 process, fast track litigants should be able to reliably assess their
potential costs liability or recovery in making decisions about the conduct of
the case.

[34]      Moreover, it is important to recognize that parties
to a R. 66 action are not compelled to remain in the fast track process. If the
spectre of “special circumstances” emerges at any time during the action,
whether in the form of complex issues, offers to settle, increased trial time,
or any other situation, the parties may consent to removing the case from R.
66, or obtain an order to that effect under R. 66(8). Thus, if a concern arises
that costs under R. 66(29) will not be adequate, this can be remedied by taking
appropriate action during the proceeding.

. . .

[37]      I would conclude that
the discretionary nature of R. 66(29) is circumscribed by the objectives of R.
66: to provide a speedier and less expensive process for relatively short
trials. Those objectives are best served by awarding lump sum costs, calculated
by reference to the amounts in R. 66(29).

[25]        
Mr. Warnett says that, just as it is open to a party to apply to opt out
of the Rule (and avoid the costs consequences of it) it is also possible for a
party to apply to opt into the Rule (and thus be subject to the costs
consequences in subrule (15)). Here, the defendants made no such application.

[26]        
Mr. Warnett also relies on Axten. In that case, Ker J confirmed
that, once an action is removed from fast track, the fast track costs provision
of the Rules no longer applies. At para. 49 of her reasons, Her Ladyship
says:

[49]      In the circumstances
of this case, where the parties deliberately removed the action from the ‘fast
track’ provisions prior to the coming into force and effect of the Supreme
Court Civil Rules, it would be contrary to a logical and reasoned analysis to
require the parties, having taken decisive action to remove the litigation from
the ‘fast track’ provisions to undertake this step again.  Indeed, this is the
situation contemplated by the transitional Rules under Supreme Court Civil Rule
24-1.

[27]        
I prefer Ms Taylor’s submissions in relation to the application of the
costs provisions of R. 15-1. In my view, this action, even though it was
not declared to be a “fast track” action, is subject to the costs provisions of
R. 15-1(15). I agree with Ms Taylor’s submissions that R. 15-1(1) is
exclusive and not inclusive. In my opinion, if a matter settles for less than
$100,000, R. 15-1(15) applies to the costs of the action. This is made
clear, in my view, by the addition to the Rules of R. 14-1(1)(f).
That subrule effectively fast tracks actions that were not fast tracked but
should have been (see Axten, supra, and Affleck v. Palmer, 2011
BCSC 1366). The cases cited by Mr. Warnett (listed above) were all, in my view,
decided per incuriam: without reference to either R. 15-1(1) or
14-1(1)(f) in relation to the issue of costs.

[28]        
This interpretation is in keeping with the object of the Rules:
“to secure the just, speedy and inexpensive determination of every proceeding
on its merits”
(R. 1-3(1)) and the proportionality provisions set out in R. 1-3(2).

[29]        
Finally, I note that Mr. Warnett also suggested that, if the defendants
wished the provisions of R. 15-1(15) to apply to the action, they ought to
have applied to place it into fast track and as they did not do so, they should
not be allowed to limit the plaintiff’s costs to the costs allowed under R.
15-1(15). This suggestion cuts both ways however. Just as it was open to the
defendants to seek an order bringing the matter into fast track, it was also
open to Mr. Warnett to seek an order (even at the trial management conference)
that R. 15-1 not apply to the action. He did not do so and as the action
is by operation of the Rules a fast track action, it attracts costs per R.
15-1(15).

[30]        
As I have found that the action falls within the provisions of R. 15-1(15),
thus the plaintiff is entitled to some proportion of the $6,500 “cap” available
(see Duong v. Howarth, 2005 BCSC 128; and Anderson v. Routbard, 2007
BCCA 193 [Anderson]). In order to avoid a re-attendance before me (or
some other registrar) to determine how much of that cap the plaintiff may
claim, I am going to employ some “rough and ready justice” (see Anderson,
at paragraph 49 and Cathcart v. Olson, 2009 BCSC 618 at paragraph 19) to
this matter. I will set the amount at the full $6,500, plus tax. This matter
settled some 15 days before trial. Likely a good deal of the trial preparation
had occurred up to the settlement. It is therefore appropriate that the
plaintiff receive the full amount of the cap: see Gill v. Widjaja, 2011
BCSC 951 (Registrar), aff’d 2011 BCSC 1822.

[31]        
The plaintiff also is entitled to his three units for preparing and
attending at this assessment of costs. Thus the plaintiff is entitled to tariff
costs of $6,830, plus taxes of $819.60, for total tariff costs of $7,649.60.

[32]        
As I have decided that R. 15-1(15) applies to this action, I do not
have to rule on the plaintiff’s claim for tariff items for the unsuccessful
mediation held in 2009, although I note that in deciding to award the plaintiff
the full amount of the cap I was mindful of the fact that there was a mediation
in this action.

[33]        
I turn now to the disbursements. As for the photocopies, Ms Taylor noted
that the defendant already paid for some copies (at $0.35 per page) but that no
credit was given to the defendant on the bill of costs for such payments. Mr.
Warnett did not specifically address me on this issue. If the defendant has
reimbursed the plaintiff for copies of some materials, the plaintiff must
credit the defendant the amounts so paid. If the parties are unable to agree on
this issue, they may set the matter back before me for a final determination of
it. I do understand, however, that, other than the defendants’ claim for a
credit in respect of the copies already paid for, the defendants are not
contesting the number of copies made, nor the $0.25 [registrar’s rate] claimed
for such copies. The parties should be able to resolve this matter themselves.

[34]        
As for the couriers, neither party made fulsome submissions to me about
the necessity and propriety (or not) of incurring the courier costs. The amount
claimed ($21.81) is small. I have no doubt that at least one courier was
necessarily employed in the conduct of this matter and I will use my discretion
to allow this amount on a “rough and ready” basis (see Sovani v. Jin, 2006
BCSC 855 (Registrar)).

[35]        
In regards to the Travlos Report, Dr. Travlos is a physiatrist. His
report is dated September 21, 2011. The Plaintiff served it on the defendants
on November 4, 2011 and on November 18, 2011 Ms Taylor in turn served the
Travlos Report on the plaintiff, apparently as she wished to rely on it at
trial and to ensure Dr. Travlos’ attendance at trial for the purposes of
cross-examination.

[36]        
Mr. Warnett submitted that, as Ms Taylor served the Travlos Report on
the plaintiff and seemingly wished to rely on it, the defendants must be taken
to have accepted the necessity and propriety of the Travlos Report itself. Ms
Taylor argued that she served it because it supported the defendants’ position
but, in her submission, it was not necessary to obtain a report from a
physiatrist as the plaintiff had a report from an orthopaedic surgeon: Dr.
Fuller (from 2009).

[37]        
Other than relying on the fact that the defendants served the Travlos Report
on them, Mr. Warnett made no other submissions regarding the necessity or
propriety of this disbursement.

[38]        
It is up to the party claiming the disbursement (the plaintiff in this
case) to prove entitlement to a disbursement on a balance of probabilities (see
Deo v. Chang, 2005 BCSC 1335 (Registrar)) and to provide evidence
to the assessing officer as to why the expense was incurred: Guelke v. Hallett
(1990), 21 A.C.W.S. (3d) 164 (B.C.S.C.). I do not have sufficient evidence
before me to hold that the expense for the Travlos Report was necessarily or
properly incurred and therefore I must disallow it.

[39]        
As for the functional capacity report, Ms Taylor submitted that
“everyone knew” the Plaintiff would not be able to do heavy labour and thus the
report was not necessary.

[40]        
Mr. Warnett submitted that:

In this case it was necessary,
or at the least proper, to have a report from an occupational therapist in
order to support the claim that Mr. Varga could no longer do the physical work
required as a glazier or other construction work…The Plaintiff had to
prove this at trial and required the Functional Capacity Evaluation to
support the claim. [Emphasis in the original.]

[41]        
He also responded to Ms Taylor’s submission by noting that the defence
did not notify him that they were prepared to admit this fact at trial and thus
proof remained necessary.

[42]        
Whether to allow the costs of this report must be judged by the
situation at the time the expense was incurred: Van Daele v. Van Daele (1983),
56 B.C.L.R. 178 (C.A.). It is also true that, generally speaking (McKenzie v
Darke, 2003 BCSC 138 (Registrar)):

[21]      Taxing officers ought
not to second guess competent counsel doing a competent job, solely on the
grounds that other counsel might have been more sanguine or less cautious in
determining how the job should be done.

[43]        
I agree with Mr. Warnett’s submissions on this issue. At the time he
commissioned the report, he believed he would have to prove, at trial, some
loss of capacity on the Plaintiff’s behalf. I will therefore allow the costs of
this report.

[44]        
Finally, as for Dr. Fuller’s second report, it was commissioned to reply
to the report of Dr. Kokan. In his submissions, Mr. Warnett says:

It was also appropriate to have
an updated report from Dr. Fuller to rebut the report from Dr. Kokan. Dr. Kokan
cited medical literature in support of his opinion. As counsel I cannot match
Dr. Kokan with his medical knowledge. I needed Dr. Fuller to provide his views
of the medical literature that Dr. Kokan cites so that the Court has complete
picture of what spondylothethis is and what the cause of pain was in this case.
. .

[45]        
Ms Taylor submits that as Dr. Fuller’s second report was a mere
reiteration of what he had already said, it was not necessary or proper. I
disagree. While Dr. Fuller does not change his opinion, he did see the
plaintiff on a second occasion (June 6, 2012) and based his opinion regarding
the plaintiff’s condition/recovery prognosis on this second visit. He also
provided a comprehensive response to Dr. Kokan’s medical-legal report.

[46]        
I find that it was necessary and proper in the circumstances to obtain
the second report. Firstly, as trial approached it was useful (and necessary)
to obtain an up-to-date report about the plaintiff’s condition. Secondly, it
was proper to have Dr. Fuller opine on Dr. Kokan’s conclusions which were not
supportive of the plaintiff. For these reasons, I would allow the costs of this
report.

[47]        
I do not know what agreements the plaintiff and defendants have made in
respect of the remaining disbursements and I am thus unable to calculate a
final amount for the costs. I believe the parties will be able to arrive at a
final amount for the costs, taxes and disbursements, but if they are not, the
matter may be set before me to determine the final amount of costs payable by
the defendants to the plaintiff.

[48]        
Finally, it is likely a certificate is not required but if one is
necessary (and the parties are agreed on the amount) they may submit one to me
for signature. However, I direct that both counsel sign any certificate
forwarded to me so that I may confirm their agreement as to the final amount of
the costs.

“Registrar
Sainty”