IN THE SUPREME COURT OF BRITISH COLUMBIA

Date: 20130530

Docket: M133757

Registry:
New Westminster

Between:

Tove Gulbrandsen

Plaintiff

And

Blake Mohr and
Albert Boyd

Defendants

Before:
The Honourable Mr. Justice Affleck

Reasons for Judgment

[1]            
On December 12, 2012, I gave Reasons for Judgment in this personal
injury action. The reasons are indexed at 2012 BCSC 1869. I awarded the
plaintiff $28,150.45 in damages against the defendant Blake Mohr. The action
had been discontinued against the other defendant.

[2]            
The defendant Mr. Mohr now applies, relying on R. 9-1(5)(b), for double
costs from March 1, 2012, which was the date on which the defendant had
delivered an offer to settle in the sum of $50,000.

[3]            
When considering an application made pursuant to R. 9-1(5) the court may
have regard for the following found in subrule 6:

(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.

[4]            
This Court has repeatedly observed that the risk of an adverse award of
costs is intended to encourage a party to settle when it is prudent to do so.
The offer made by the defendant was reasonable at the time it was made and
ought to have been accepted. There will usually be cost consequences when a
party declines to accept a reasonable offer. I have an unfettered discretion
with respect to those consequences. See Bailey v. Jang, 2008 BCSC 1372.

[5]            
In exercising that discretion there are three possible approaches I have
considered. The first would be to award costs to the plaintiff up to the date
of the offer and deprive her of costs thereafter. In my view that outcome
cannot be justified. It would largely ignore the intent of the rules to provide
for an award of costs in favour of a party who has made an offer which ought to
have been accepted but was not. The second alternative would be to award the
plaintiff costs up to the date of the offer and the defendant single costs
thereafter. I would be inclined to make that award if the award of damages had
fallen only slightly short of the offer. It did not.

[6]            
The remaining possible outcome I have considered is to award the
plaintiff costs to the date of the offer and to award the defendant double
costs thereafter, as he proposes. The factor which might militate against doing
so is the relative financial circumstances of the parties. The plaintiff is a
woman of modest means. I know nothing of the remaining defendant, Mr. Mohr’s,
means. The action was defended by counsel instructed by ICBC. The court may
take into account the presence of insurance coverage when assessing the
relative financial circumstances of the parties: Smith v. Tedford, 2010
BCCA 302 at para. 19. However, the presence of insurance coverage is not always
a relevant factor. As the court observed in Hunter v. Anderson, 2010
BCSC 1591 at para. 22:

…it is in circumstances where a
defendant’s insurance coverage creates an unfair advantage leading to
unnecessary costs through testing the plaintiff’s case, where an insurer’s
financial circumstances supplant those of the litigant as a factor to consider
in determining costs.

[7]            
I find that the presence of insurance coverage in the present case did
not create an unfair advantage leading to unnecessary costs. It was the
plaintiff who unreasonably rejected the defendant’s offer to settle. Therefore,
I am unable to find a relevant significant disparity in the relative financial
circumstances of the parties.

[8]            
Unless there is some compelling reason to the contrary, the defendant is
entitled to double costs from the date of the offer. Not only is there no
reason to the contrary, in my view there is a compelling reason to accept the defendant’s
argument. In my reasons for judgment which awarded damages to the plaintiff, I
nevertheless found the plaintiff was an unreliable witness. This was not simply
a matter of a witness who was honestly mistaken. I concluded the plaintiff had
attempted to persuade me of facts that she knew were not true. On the costs
hearing the plaintiff complained about my conclusions regarding her credibility
but the costs hearing was not an occasion to re-argue her case for damages.

[9]            
The plaintiff will be entitled to her costs up to the date of the offer
to settle and the defendant will be entitled to double costs thereafter.

[10]        
The plaintiff was represented by counsel at the trial. On the costs
hearing she represented herself. She informed me that she had made a number of
attempts to instruct counsel on her behalf in regard to the costs issues but
was unsuccessful. Costs questions can be difficult for a lay litigant to manage.
I recognize the difficulties faced by the plaintiff in addressing the
application of the defendant for double costs. In the circumstances the parties
will bear their own costs in respect of the costs hearing.

“Affleck J.”