IN THE SUPREME COURT OF BRITISH COLUMBIA

Date: 20140331

Docket: M90585

Registry:
Kelowna

Between:

Barbara Ross

Plaintiff

And

Tamara Logan and Sandra
Crawshaw

Defendants

Before:
Master Young
(as Registrar)

Reasons for Decision

Introduction

[1]            
This is a cost assessment in a personal injury action. The action was
settled three days before commencement of the trial.

[2]            
In that settlement, the plaintiff agreed to accept $75,000 in damages
plus assessable costs and disbursements. The negotiations had started at
$15,000.

[3]            
The parties reached an agreement on the tariff items at $6,500 and most
of the disbursements.

[4]            
The only remaining area of contention is reasonableness of the following
disbursements:

·      
Viewpoint of medical assessment, physical, medicine and
rehabilitation ‑ $6,824.15

·      
Viewpoint of second bill for telephone conference/cancellation ‑
$3,228.75

[5]            
The issue of interest on disbursements was settled on the courthouse
steps at 6 percent simple interest.

Background

[6]            
The plaintiff suffered injuries as a result of a motor vehicle accident
which occurred March 25, 2009. On November 6, 2012, a notice of trial was filed
setting a trial for November 25, 2013.The plaintiff suffered soft tissue injury
to her neck, back and arm, and in particular her right shoulder.

[7]            
Counsel for the plaintiff retained the services of Dr. Pisesky, an orthopedic
surgeon, to provide medical legal opinion. Such opinion was provided August 15,
2011, where Dr. Pisesky opined that the plaintiff’s prognosis was good and
prognosed possible improvement of function.

[8]            
Following this report, the plaintiff reported ongoing symptoms which
were getting progressively worse. Counsel for the plaintiff requested a further
report from Dr. Pisesky which was obtained and did not differ
significantly from his first report. Despite his optimism, the plaintiff’s
condition did not improve, and the plaintiff’s counsel sought a further report
from a new specialist in physical medicine and rehabilitation. The Pisesky
reports were not served on the defendant but the defendant has agreed to pay
for the reports.

[9]            
Given that the trial was one year away and given that there are a
limited number of specialists in physical medicine and rehabilitation in the
Kelowna area, counsel for the plaintiff found it necessary to use the services
of a booking agency name Viewpoint Medical Assessment Services Inc. (“Viewpoint”).
Viewpoint locates expert medical witnesses in the required specialty who have
appointment vacancies that fit the service deadline requirements. Both
plaintiffs and defendants use booking agents when necessary to locate an expert
witness who would be available to give evidence at trial. These booking agents
do charge a fee for locating an expert and do charge a cancellation fee if the
expert services are not canceled within a certain period of time.

[10]        
The defendant does not take issue with the necessity of employing a
booking agency to locate a physiatrist who would be available to testify at
trial one year later. The only issue the defendant has with the disbursement is
that it is simply too high.

[11]        
The cost of the report from Dr. Krassioukov, specialist in physical
medicine and rehabilitation was $6,824.15. A breakdown of that account shows
that Viewpoint charged $2,700 for a three-hour independent medical evaluation
at the rate of $900 an hour. "Additional Time In Excess of Standard"
of four units at $900 an hour was charged for a total of $3,600. There is no
explanation of what is meant by “in excess of standard”.

[12]        
Viewpoint is located in Alberta, and Dr. Krassioukov traveled from
Calgary to Kelowna to conduct the examination and charged for his travel costs.
The defendant does not take issue with those travel costs.

[13]        
Viewpoint has a written cancellation policy which says that
cancellations of IME appointments must be done 12 full business days in advance
of the appointment or a fee of 50 percent will be charged. The policy for
cancellation of attendance at court is that notice must be given three business
days before the court appearance or a 50-percent charge must be paid. Viewpoint
sent an email to the legal assistant for the plaintiff on November 15, 2013,
confirming that Dr. Krassioukov would charge $670 an hour and required
three full business days for cancellation or there would be if fee if he was
not notified prior to November 20, 2013.

[14]        
Further, on November 20, 2013, Viewpoint wrote to the legal assistant
for the plaintiff and said Dr. Krassioukov confirmed the cancellation fee
would be $2,670 if his attendance was cancelled after 4 p.m. on November 20,
2013.

[15]        
The defendant does not take issue with the expert’s entitlement to some
cancellation fee but, again, takes issue with the amount being so high.

[16]        
Viewpoint billed further charges for a phone consultation with counsel
for the plaintiff and for reviewing Dr. Piper’s report. The breakdown of Dr. Krassioukov’s
second bill is provided in a memorandum from the legal assistant to counsel for
the plaintiff dated November 1, 2013. Dr. Krassioukov charged $2,670 for the
cancellation fee; $223.75 for the telephone interview, which was conducted on
November 18, 2013; and $335 for his review of Dr. Piper’s report. The only
issue taken by the defendant is that the $2,670 cancellation fee is too high.

The Law

[17]        
I am fortunate that the issue of proportionality of disbursements
charged in party-and-party costs has been written about recently by my brother
and sister masters, and I am indebted to them for their reasons.

[18]        
In 2013, Master McDiarmid addressed the issue of proportionality of
disbursements in Bodeux v. Tom, 2013 BCSC 2327. He said:

[14]      Rule 14-1(5) of the Civil Rules sets out how
I am to assess disbursements, as follows:

Disbursements

(5) When assessing costs under
subrule (2) or (3) of this rule, a registrar must

(a) determine which disbursements
have been necessarily or properly incurred in the conduct of the proceeding,
and

(b) allow a reasonable amount for those disbursements.

[19]        
In the case before me, there is no issue with respect to the
disbursement being necessary or proper. My review is focused solely on the
reasonableness of the amount for the disbursement.

[20]        
On the issue of proportionality, Master McDiarmid says:

[19]      In dealing with proportionality, I was referred to
the decision of Registrar Sainty in Dhillon v. Bowering, 2013 BCSC 1178,
and in particular para. 23 with respect to proportionality which reads as
follows:

[23]      I must also consider "proportionality"
in making my decision. But proportionality is, in my view, a two-way street.
The amount of money at issue in an action (large or small) may have a bearing
on both the necessity and propriety of a disbursement and whether it is
reasonable in the circumstances. Here, the defendants’ initial offer to settle
this matter (made August 11, 2009) was the sum of $22,500 all-inclusive. That
initial offer was later increased to $35,000. Following service of all of the
plaintiff’s experts’ reports, the formal offer increased to $145,000 and, as
noted earlier, the actions settled the Friday before trial for $175,000 plus
costs and disbursements. No doubt the experts’ reports played a part in the
settlement offer and influenced the outcome. It was not until the medical
reports and the Functional Capacity Evaluation were provided to the defendants
that the amount of the offer increased to an amount the plaintiff was prepared
to accept. In my view (and I agree with Ms. Dewar’s submissions on this
point), proportionality (which I must consider in assessing costs per Rule
14-1(2)(b)) refers to the significance of the claim; either small or large.

[21]         
At paragraph 22, he quotes again from Registrar Sainty’s decision
in Fairchild v. Vancouver Coastal Health Authority, 2011 BCSC 616:

[22]      I have also gained guidance from the extract
reproduced in Chow [2012 BCSC 729], at para. 144 of Registrar
Sainty’s decision in Fairchild v. Vancouver Coastal Health Authority,
2011 BCSC 616:

[144]    I have previously held
(see Dosanjh v. Martin 2001 BCSC 1759) that expert’s fees ought only to
be reduced where there is a clear overcharge. Specifically I said:

[50]      In my opinion, a registrar should not, without
good reason, interfere with the amounts charged by experts. The plaintiff hired
the experts in good faith to assist with the plaintiff’s case. Those experts
charge what they charge. In my view, the defendant should not be rewarded (and
the plaintiff penalised) by a registrar reducing expert fees except in cases
where there is clearly an overcharge or it is determined that the fees were
unreasonable. (See Reap v. Insurance Corporation of British Columbia,
[2000] B.C.J. No. 2258 (Registrar). I cannot say that there was a clear
overcharge or that the disbursements were unreasonable for any of the medical
legal reports provided by Drs. Yasin and Khan. I will therefore allow the
disbursements for the medical legal reports prepared by each of Drs. Khan and
Yasin.

[22]        
Master McDiarmid assesses the cost of a neurologist’s report for
investigating the plaintiff’s headache symptoms. The doctor charged $650 an
hour, plus $30 an hour for typing a 20-page report. The charge for the preparation
of the report was $7,236.25.

[23]        
The learned master says:

[51]      Dr. Woolfenden is
a neurologist who is also an Associate Professor at the University of British
Columbia. While his hourly rate is higher than that of other specialists whose
accounts are before me, it is not “clearly an overcharge”. Exhibit A to the C.
Harkness affidavit #2 made October 17, 2013 and filed October 18, 2013, by
Cynthia Harkness, legal assistant for Mr. Yawney attaches as exhibit A a
breakdown of Dr. Woolfenden’s accounts setting out a time expended doing
certain tasks and the cost of those tasks. I do not find that the fees he
changed were unreasonable.

[24]        
This charge was allowed in full by Master McDermott.

[25]        
In a very recent decision by my sister, Master Bouck, sitting as a
registrar in Salsman v. Planes, 2014 BCSC 45, Master Bouck at para. 30
addresses the issue of assessing proportionality of disbursements:

[30]      On a review of the authorities cited, there appears
to be an emerging consensus amongst assessing officers that Rule 1-3 (2) of the
Supreme Court Civil Rules (“SCCR”) invites a more vigorous
approach to the questions of necessity, propriety and reasonableness than what
is seen in decisions rendered in the decade or so before the introduction of
the SCCR. Indeed, in terms of analysis and result, there is a greater
kinship between decisions rendered in the early 1980’s (Hall v. Strocel,
supra; Bell v. Fantini (No. 2) (1981), 32 B.C.L.R. (322); Mohr
v. Dent (1983), 40 C.P.C 8 (B.C.S.C.)) and those issues issued since July
1, 2010. That is not to suggest that decisions rendered in the intervening
years were in any way wrong, but rather that proportionality now enjoys a
greater or perhaps more specific recognition on assessments.

[31]      This development has been recognized by the court
in terms of assessing the reasonableness of disbursements:

…The concept of proportionality
in the new rules is an attempt to vest in the court a responsibility that has
always rested with counsel, where it best remains, generally speaking. … the
notion of reasonableness has always encapsulated a sense of proportion.

Fairchild v. Vancouver Coastal
Health Authority at para. 17 (S.C.).

[32]      On the facts of this case, the defence places
emphasis on the following passage from Hall v. Strocel:

…more and more experts are becoming involved in more and
more litigation. I do not wish to be misinterpreted, in most cases they are
necessary and are of assistance to the Court. Nevertheless, that does not mean
that costs of such experts should not have a limit. The unsuccessful party
should only be responsible for a reasonable fee, (a reasonable cost). At the
hearing before the registrar, Dr. Walker was referred to as the “Cadillac”
of the economists. If the plaintiff wishes to use a “Cadillac” he may do so,
but I do not think that the defendant need pay for that “Cadillac” when the job
can be done by others in the industry, i.e. an “Oldsmobile” or a “Buick”.

[26]        
Master Bouck was tasked with the determining whether some of the reports
were necessary and proper. That is not an issue in the hearing before me. In Salsman,
Dr. Courtney, a neuropsychologist, charged close to $5,800 for his first
report and over $5,000 for his second report. Master Bouck found that the
plaintiff was justified in commissioning the second report but ordered that the
charges for the report be reduced. She disallowed a charge for propriety test
costs, which she found was more appropriately part of the overhead.

[27]        
The defendant in Salsman provided some evidence of alternative
costs of a neuropsychological assessment and report by obtaining information
from four other neuropsychologists regarding fees typically charged for such an
assessment and report, as well as the practices involved in preparing a report
(for example, whether testing is delegated to a psychometrist who charges out
at a lower rate). Master Bouck concludes:

[51]      Based on this evidence, it would appear that the charges
of Malcolm and Associates exceed those typically seen in the local market. The
charges suggested by the other neuropsychologists range from $2,500 to $4,000
for a full assessment, report and follow up interview.

[52]      Dr. Corney’s reports were neither reviewed nor
critiqued by these other neuropsychologists. Nonetheless, there is no
explanation offered as to why Malcolm and Associates’ fees are above the norm
found in the marketplace. Nor can it be said that either of Dr. Corney’s
reports contain unusual or exceptional features. Moreover, there is much
duplication between the two reports and the content includes what is accurately
described by the defence as “boilerplate” information.

[53]      Based on the evidence
presented, and considering once again the impugned charges in proportion to the
amount involved and complexity and importance of the proceeding, I allow $4,480
for the February 14, 2011 invoice and $ 4,200 for the April 5, 2013 invoice
(both inclusive of HST).

[28]        
And at paragraphs 72, the learned master deals with an administrative
fee charged by a rehabilitation consultant.

[72]      There is no justification offered in the affidavit
material for the $350 administration fee. Such a fee might be contracted for
with the plaintiff, but the defendant should not be required to pay a charge
which is the equivalent to office overhead.

[73]      In the circumstances of this case, I am satisfied
that it was necessary and proper for Ms. Phillips to review medical
information, up-date her assessment of the plaintiff, obtain quotes from
suppliers and prepare a written report based on the recommendations (to which
she concurred but did not expand upon) made by Drs. Grimwood and Filbey.

[74]      I find that a
reasonable cost for such a report is $1,200 (inclusive of taxes).

This was a 50-percent reduction in the cost of the
report charged.

Decision

[29]        
Both counsel agree that at the time, it was necessary to employ the
services of a booking agency in order to obtain an available expert in time for
trial. I conclude that that service does not come for free, and therefore one
might properly expect some additional charge to be added on to the cost of the
expert report. Viewpoint does not provide a breakdown of how much its surcharge
is over and above what it pays its physician.

[30]        
In evaluating the reasonableness of the charge, I am provided a wide
measure of discretion. However, as Madam Justice Dardi wrote in Smith v.
Moshrefzadeh, 2013 BCSC 1623, the discretion must be exercised judicially
in a principled way consistent with the Supreme Court Rules and not
arbitrarily or capriciously. It is fine for me to say in chambers that a
$900-an-hour charge seems high, but in exercising my discretion, I must set out
for the litigants what I am comparing that fee to.

[31]        
Counsel for the plaintiff has provided me with copies of other expert
reports.

Dr. Pisesky’s Report

[32]        
Dr. Pisesky is an orthopedic surgeon who also has a diploma is sports
medicine. He has a master’s degree in science and graduated from medical school
in 1976 and obtained his fellowship in orthopedic surgery in 1983. He has
practiced as an orthopedic surgeon since 1984.

[33]        
Dr. Pisesky reviewed Dr. Cosmann’s clinical records, the Sun
City Physiotherapy records, the massage therapy records, the ICBC CL-19 form,
and the plaintiff’s x-rays prior to conducting his examination of the
plaintiff. He was provided a history of the motor vehicle accident, the treatment
the plaintiff received, a social history, and the description of current simple
time ontology. He conducted an examination of her cervical spine, her
shoulders, lumbar spine, and legs and provided an opinion and prognosis.

[34]        
Dr. Pisesky charged a total of $1,822 for conducting an examination
of the plaintiff, reviewing previous medical records, and preparing an eight-page
report. He provided a breakdown of his account. For the medical legal opinion,
he charged $1,563. For the medical examination, he charged $259.

The British Columbia Medical Association
(“BCMA”) Guidelines

[35]        
BCMA Guideline for fees for uninsured services effective April 1,
2013, recommended a charge of $1,634.04 for medical legal opinion which would
require extensive exercise of expert knowledge and judgment with respect to the
facts. I assume this guideline does not include the cost of the
examination.

[36]        
The Guidelines recommend a fee of $2,612.22 for expert testimony
per day in court or $1,634.04 for one-half day or less. It recommends a charge
for court preparation by an expert witness per hour of $388.62. Where there is
failure of notification of court adjournment or court settlement, the BCMA Guidelines
recommends the charge of $1,960.44 if cancellation is not given five working
days in advance.

Dr. Piper’s Report

[37]        
Dr. Piper is an orthopedic surgeon. He graduated from medical
school in 1968 and received a further degree of Master of Science in anatomy
1972. In 1974, he completed his fellowship designation in orthopedic surgery,
and he has been engaged exclusively in the practice of orthopedic surgery since
1974. He became a diplomat with the American Board of orthopedic surgery in
1976 and a fellow of the American College of Surgeons in 1985. He is a clinical
professor of orthopedics with the University of British Columbia.

[38]        
Dr. Piper provided a medical legal opinion to the defendant. In his
report, he provided a history both of the accident and post-accident. He
conducted an examination of the plaintiff. He reviewed previous medical
reports from various practitioners, and he concluded that she did suffer
from a fairly significant muscular-ligamentous injury of the cervical spine, and
probably interscapular region, as a result of the accident. He recommended
treatment and prepared a six-page report for which he charged a total of $1,750.

Dr. Krassioukov’s Report

[39]        
Dr. Krassioukov graduated from medical school in 1979 and started
clinical practice as a neurologist specializing in physical medicine and
rehabilitation. He pursued postgraduate research and obtained a PhD from the
Russian Academy of Science in 1983. (He makes no mention of a master’s degree).
He moved to North America in 1991 and fulfilled his medical residency training.
He became a fellow of the Royal College of Physicians and Surgeons in 2006, and
focuses his medical practice and clinical research on neurotrauma and spinal
cord injury. I cannot tell from this description what he did between 1991 and
2006 or whether his practice commenced in 2006. He maintains a clinical
practice at the GF Strong Rehabilitation Center and has a cross-appointment to
the department of psychiatry. He is actively involved in medical working groups
and boards dealing with spinal cord injury issues, and he is listed extensively
on a variety of aspects related to medical management of the rehabilitation of
individuals with spinal cord injuries. The first five pages of his report
contained his qualifications and recital of the directions he received from
legal counsel.

[40]        
The actual assessment and conclusion start a page 5 of 22.

[41]        
He provided a description of the mechanics of the accident and the
plaintiff’s symptoms post-accident and a summary of the treatments that she had
received. The details of his examination are described at page 9 and in more
detail in an attachment. His opinion starts at page 10. His diagnosis differs
from that of Dr. Pisesky in that he locates the clinical picture of
rotator cuff pathology. This is noted by Dr. Piper in his report as well.
At page 12, he summarizes his opinion of the residual effect of the accident
and his recommendation for treatment. The report is concluded at page 16. Page
17 is blank and pages 18 to 22 are the attachment providing a more detailed
description of the physical examination he conducted.

[42]        
Dr. Krassioukov did have to travel from Calgary for the examination.
He examined the plaintiff for three hours. I do not have evidence of the length
of Dr. Piper or Dr. Pisesky’s examination. Dr. Pisesky charged
$259 for his examination. Dr. Piper did not charge this amount separately
but included it in his overall fee.

[43]        
When determining what a reasonable rate might be for a three-and-a-half-hour
examination, the only evidence I have is the BCMA Guidelines. It
recommends a charge of $868.02 for part-time professional employment where the fee
for service is not applicable half day session (3.5 hours) under its heading
industrial and insurance. There does not appear to be any estimates for
examinations under the medical and legal fees section.

[44]        
I am mindful of Registrar Sainty’s comment quoted above from Dosanjh
v. Martin, 2001 BCSC
1759, that:

[5]        …experts charge what
they charge. In my view, the defendant should not be rewarded (and the
plaintiff penalised) by a registrar reducing expert fees except in cases where
there is clearly an overcharge or it is determined that the fees were
unreasonable

[45]        
I find a $2,700 charge for a three-and-a-half-hour examination to be
unreasonable when I compare it to a BCMA rate of close to $900. If the BCMA Guidelines
recommend $248 an hour for part-time professional employment, then I find
a rate of $400 an hour for this examination would be reasonable in this case
given that there is a surcharge being charged by Viewpoint.

[46]        
I find it unreasonable to charge $900 an hour to write a fairly simple
medical‑legal opinion. Dr. Krassioukov’s medical-legal report is
well written and is longer than the other two reports I reviewed, but it is no
more complex than the other reports. The plaintiff suffered a fairly significant
soft tissue injury which did also include some rotator cuff injury to her
shoulder. This was observed by Dr. Krassioukov and by Dr. Piper. Dr. Krassioukov
prepared several additional pages summarizing his physical assessment of the
plaintiff which is why his report is longer.

[47]        
I find that a four-hour charge to prepare this report is reasonable, but
the $900-an-hour rate is an unreasonable overcharge.

[48]        
I will allow the preparation of the report at $400 an hour, so the
preparation of the report itself will be allowed at $1,600. The total charge
for this medical-legal report including the examination is $3,000. In addition,
I allow Dr. Krassioukov travel expenses in the amount of $524.15.

[49]        
Bill number one is reduced from $6,824.15 to $3,524.50.

[50]        
If Viewpoint has evidence of what their costs are in acting as a booking
agent, they did not share it with me. In the future, if they wish to claim a
surcharge, they should particularize it in their bill and provide supporting
evidence. I have increased the hourly rate for this account because I know
there was a booking agent involved.

[51]        
In an assessment of party-and-party costs, it is not sufficient for the plaintiff
to say, “We entered into a contract with Viewpoint and we are bound to pay whatever
they bill.” That may be the case and the plaintiff may be out of pocket because
counsel chose to contract at this high rate, but that does not mean that the court
should condone passing this rate on to the defendant. As Justice Proudfoot said
in Hall (Guardian ad litem) v. Strocel (1983), 34 C.P.C. 170 (B.C.S.C.)
at para. 10:

I see no error here, the
Registrar directed his mind to the appropriate legal principles when he
exercised his discretion. It seems as if more and more experts are becoming
involved in more and more litigation. I do not wish to be misinterpreted, in
most cases they are necessary and are of assistance to the Court. Nevertheless (that
does not mean that costs of such experts should not have a limit. The
unsuccessful party should only be responsible for a reasonable fee, (a
reasonable cost). At the hearing before the Registrar, Dr. Walker was
referred to as the "Cadillac" of the economists. If the plaintiff
wishes to use a "Cadillac" he may do so, but I do not think that the
defendant need pay for that "Cadillac" when the job can be done by
others in the industry i.e. an "Oldsomobile" or a "Buick".

[52]        
The court has an obligation to assess proportionality, and if the court
blindly approves accounts because that is what the plaintiff has agreed to pay,
there will be no limit to what the service providers will charge. They will
charge what the market will bear. Here is a clear message from the court that the
market will not bear a $900-an-hour rate for a fairly simple medical-legal
opinion.

[53]        
The second bill from Dr. Krassioukov is for a telephone
consultation, for reviewing a further medical legal report from Dr. Piper,
and for cancellations of his court appearance. I will allow the first two items
in full. This was consented to by the defendant, and in any event, these
charges are reasonable.

[54]        
I reduce the cancellation charge to $2,000 in keeping with the BCMA Guidelines
which apply where legal counsel failed to give five working days’ notice of
cancellation of court or other legal appearances. I find the policy of charging
a cancellation fee for failure to give three days’ notice reasonable. There is
some evidence before me that Dr. Krassioukov was double-booked on the day
set for his court appearance. He attempted to move his appearance to the 25th,
and when that was not agreed to, he asked if his appearance could be scheduled
for first thing in the morning. I do not have any further details other than the
correspondence between legal assistants. In the circumstances, I think that a
cancellation fee of $2,000 is quite reasonable.

[55]        
The second bill of Dr. Krassioukov will be reduced from $3,228.75
to $2,558.75 [$2,000 plus $335 plus $223.75 from tab K].

Costs

[56]        
The parties settled the bill of costs with the exception of the
attendance before me on January 28, 2014, and asked that I include a decision
on the issue of costs today. I find that the plaintiff is not entitled to costs
for the appearance today because she was not successful in defending the
Viewpoint charges. I will, however, allow the plaintiff a lump sum cost of $600
for preparing the material, which was comprehensive and helpful and led to the
resolution of many outstanding issues before the matter came before me.

“Barbara M. Young”