IN THE SUPREME COURT OF BRITISH COLUMBIA

Date: 20121019

Docket: M105414

Registry: New Westminster

Between:

Carmel
Christina Keenan

Plaintiff

And:

Lynda
Anne Fletcher and
Robert Macaire Gordon

Defendants

–
and –

Docket:
M105416

Registry: New Westminster

Between:

Carmel
Christina Keenan

Plaintiff

And:

Alma
Anna Kohls

Defendant

– and –

Docket:
M106107

Registry: New Westminster

Between:

Carmel
Christina Keenan

Plaintiff

And:

Pak Ngo Jasper Tam

also known as Pak
Ngo Tam

Defendant

–
and –

Docket:
M106105

Registry:
New Westminster

Between:

Carmel
Christina Keenan

Plaintiff

And:

Brian
Richard Sutherland
and Gail Ann Sutherland

Defendants

Before:
The Honourable Mr. Justice G.R.J. Gaul

Reasons for Judgment
Re: Costs

I.        Introduction

[1]            
In 2006 the plaintiff was involved in four motor vehicle accidents. The
first accident was on 24 May (“MVA #1”); the second on 29 May
(“MVA #2”), the third on 30 May (“MVA #3”) and the fourth on 14 July
(“MVA #4”).

[2]            
On 7 July 2006, counsel for the plaintiff sent two identical
letters to the Insurance Corporation of British Columbia (“ICBC”), indicating
that he had been retained by the plaintiff with regards to MVA #1 and MVA #2.
On the same day, the plaintiff’s counsel sent a third nearly identical letter
to ICBC, regarding MVA #3. On 21 July 2006, counsel for the plaintiff
sent a fourth letter to ICBC, one with respect to MVA #4, that was in the
same basic form as his earlier correspondence.

[3]            
As opposed to filing one writ of summons and statement of claim
incorporating all four accidents, the plaintiff commenced separate legal
actions for each accident:

 a)       MVA #1:
Action No. M105414 (writ of summons and statement of claim filed on 26 April
2007);

 b)       MVA #2: 
Action No. M105416 (writ of summons and statement of claim filed on 26 April
2007);

 c)       MVA #3: 
Action No. M106105 (writ of summons and statement of claim filed on 28 May
2007); and

 d)       MVA #4: 
Action No. M106107 (writ of summons and statement of claim filed on 28 May
2007).

[4]            
Mr. Spraggs acted for the plaintiff in all four of her actions. Mr. Urquhart
represented the defendants in each of the actions.

[5]            
At the initiative of counsel for the defendants, and with the consent of
all parties, the four actions were ordered heard together at one trial.

[6]            
At trial, the defendants in each of the four actions admitted liability.
Consequently, the two principal issues in dispute were causation and quantum of
damages.

[7]            
At the conclusion of the 11‑day trial, I granted judgment to the
plaintiff regarding her claims for MVA #3 and MVA #4. I dismissed the
plaintiff’s claims concerning MVA #1 and MVA #2. My reasons for
judgment are indexed as 2011 BCSC 520.

[8]            
Not having been able to agree on costs, the parties filed written
submissions setting out their respective positions on the issue.

Issues

[9]            
The following two issues need to be addressed and resolved:

 a)       What
award of costs should be made with respect to MVA #1, MVA #2, MVA #3
and MVA#4?

 b)       Is the plaintiff
entitled to Special Costs?

Discussion / Decision

  Position of the
Plaintiff

[10]        
The plaintiff submits she was successful at trial and therefore is
entitled to her costs and disbursements for all four actions. In advancing this
position, the plaintiff maintains that neither the former Rules of Court,
nor the present Supreme Court Civil Rules, obliged her to initiate one
action in relation to all four accidents or prohibited her from proceeding as
she did (i.e., commencing four separate actions). As justification for
initiating four actions instead of one, the plaintiff asserts that particularizing
all four accidents in one statement of claim would have “unduly complicated and
delayed the proceedings.”

[11]        
In addition to her ordinary costs, the plaintiff also claims she is
entitled to special costs against the defendants for what she describes as
“privacy issues,” as well as the process in which an exhibit filed by the
plaintiff, that contained personal and confidential information about the
plaintiff, was dealt with at trial. In his written submissions on costs,
counsel for the plaintiff explained the plaintiff’s position on this issue as
follows:

…the Plaintiff submits that
she should be entitled to special costs relating to how certain privacy issues
were dealt with by the Defendants during the trial, utilizing additional and
unnecessary court time.

. . .

The Plaintiff further seeks an
order for special costs relating to the Defendants’ conduct in dealing with
certain sensitive, private and, ultimately, irrelevant documents.

. . .

The necessity of having to
address the privacy measures lengthened the time of trial and caused additional
preparation and submissions to be made by Counsel. This increased the costs of
the trial and put the Plaintiff and her Counsel to additional time and expense.

. . .

The Plaintiff submits that the
actions of the Defendants in pursuing the issue of irrelevant and private
psychological records, both during and after the trial of this matter,
requiring a sealing order of the Court for these records, are worthy of an
order of special costs against the Defendants.

. . .

…Although Defence Counsel
maintained that the records could be related to claims for wage loss, the more
likely purpose of attempting to reference the records in question, repeatedly,
was to embarrass and emotionally impact the Plaintiff in an unwarranted attack
on her credibility.

[12]        
While the plaintiff expressed concern about the defendants’ possession
and use of all of her clinical records, the focal point of the dispute was on
one particular paragraph in one of the records (the “Paragraph of Concern”). In
his extensive supplemental written submissions on costs, counsel for the
plaintiff explained:

In response to the Defendants’
submissions on the issue of special costs, in their entirety, the Plaintiff
submits that it is how the “paragraph of concern” was treated by the Defendants
at trial that warrants an award of special costs.

[13]        
Counsel for the plaintiff retained the services of outside counsel to
assist him, both during the trial and afterwards, with the confidentiality
issues surrounding the exhibit containing the plaintiff’s clinical records. Outside
counsel spoke and liaised with counsel for the defendants concerning this issue
and eventually both sides reached a satisfactory agreement for the redaction of
the Paragraph of Concern from the defendants’ copy of the exhibit in question. Counsel
for the plaintiff explained his reason for retaining outside counsel:

Further, …before closing
arguments were completed, it became necessary for the Plaintiff to retain
independent counsel to ensure that the confidentiality of the records… was
being maintained. The Plaintiff also ordered transcripts from trial to confirm
the orders made with respect to these records.

[14]        
The plaintiff asserts that the expenses associated with the retention
and use of outside counsel was a justifiable disbursement and should form part
of the award of special costs.

  Position of the
Defendants

[15]        
The defendants argue that the trial involved four sets of pleadings
contained in four different trial records and therefore it actually entailed
the judicial consideration and determination of four separate and distinct
actions. While accepting that some witnesses and evidence addressed more than
one action, the defendants assert that each action also had their own distinct costs
for which the successful parties should be entitled.

[16]        
The defendants in MVA #1 and MVA #2 maintain that as they presented
witnesses and evidence in response to the plaintiff’s specific claims against
them, claims that were eventually dismissed by the court, they should be
granted their ordinary costs and disbursements. Counsel for the defendants
submits that a reasonable award of costs for each of these two actions would be
one day of trial preparation and trial attendance as well as the disbursements
for the individual steps that can be allocated to each of the actions.

[17]        
Counsel for the defendants acknowledges that the defendants in MVA #3
and MVA #4 are responsible for the plaintiff’s costs and disbursements
associated with those actions.

[18]        
With respect to the plaintiff’s claim for special costs, counsel for the
defendants defends his use and handling of the plaintiff’s clinical records and
particularly the Paragraph of Concern, both at trial and afterwards. The
plaintiff had placed her emotional and mental health in issue by claiming in
each of her statements of claim that the accidents in question had caused her
to suffer “nervous tension, depression, anxiety and apprehension, and shock”
and that these conditions contributed to her loss of future earning capacity,
including a lost promotion at work. It was therefore necessary for the
defendants to cross-examine the plaintiff on these claims as well as any
pre-existing depression she had prior to the first accident.

[19]        
Counsel for the defendants submits that he never referred to the Paragraph
of Concern during his cross-examination of the plaintiff and that the suggestion
he pursued his examination with the aim of embarrassing her is completely unfounded.

[20]        
Finally, the defendants maintain there was no need for the plaintiff to
retain outside counsel to address the privacy and confidentiality issues of the
plaintiff’s clinical records that had become an exhibit at trial. According to
counsel for the defendants, the plaintiff’s concerns regarding the records in
question could have been addressed between himself and counsel for the
plaintiff had counsel for the plaintiff been willing to do so. In his written
submissions, counsel for the defendants explains:

…at no time prior to the day of
the trial, when this [the confidentiality of the plaintiff’s clinical records]
became an issue, did counsel for the Plaintiff ever advise counsel for the
defendants that there was a concern with respect to the “paragraph of concern”
or any other portion of the document contained in [the exhibit].

[21]        
Counsel for the defendants summarized the defence position on this facet
of the plaintiff’s argument for special costs as follows:

…there is nothing in the
conduct of the Defendants, or counsel for the Defendants, which could be called
“scandalous” or “outrageous” or “reprehensible”…[w]hen this matter was
brought up, after the conclusion of the trial, by [outside counsel], the
Defendants acted appropriately and took extraordinary steps to secure the
privacy of the Plaintiff by redacting the [Paragraph of Concern] from its
records which only got there due to the fact that the counsel for the Plaintiff
failed or neglected to redact the offending paragraph in the first place…

  Costs for MVA #1,
MVA #2, MVA #3 and MVA #4

[22]        
Whether under Rule 57 of the former Rules of Court or Rule 14‑1
of the current Supreme Court Civil Rules, the successful party in an
action is entitled to their costs unless otherwise ordered by the court.

[23]        
In my opinion, the plaintiff’s submission that she was the successful
party at trial ignores the fact that two of her four actions were dismissed.
The plaintiff was the successful party in her actions for MVA #3 and MVA #4;
however her claims relating to MVA #1 and MVA #2 failed. Therefore, the
defendants in the actions relating to MVA #1 and MVA #2 were the
successful parties in those actions.

[24]        
Plaintiff’s counsel is correct to point out that the defendants in all
four actions were represented by the same legal counsel and that the expert
reports prepared for the litigation addressed all of the motor vehicle
accidents. There were therefore some economies of scale in this litigation.
However, the plaintiff’s choice at the outset to proceed with four distinct
actions compelled the defendants’ counsel to prepare and issue four sets of
responsive pleadings and to take a number of independent steps in relation to each
action. In my opinion, all four actions could have been merged into one set of
pleadings and in this regard, I reject the argument of the plaintiff that
consolidating the four claims into one action would have unduly complicated and
delayed the proceedings.

[25]        
There is no dispute that the plaintiff was successful in her claims
against the defendants in MVA #3 and MVA #4. She is therefore entitled to her
ordinary costs and disbursements for those actions. However in my opinion, by
launching separate actions and filing separate pleadings, the plaintiff caused the
defendants in MVA #1 and MVA #2 to incur costs unique to the claims
against them. Those defendants successfully defended against those claims and
therefore I see no justifiable reason to preclude them from claiming the costs
and disbursements that can be attributed to those actions.

[26]        
The plaintiff submits that notwithstanding her lack of success in her
actions for MVA #1 and MVA #2, she should still obtain all of her costs “based
on the reasonableness of the costs incurred in pursuit of all four actions as
well as the indivisibility of the costs for all four actions”. In the
alternative, the plaintiff argues that if the court determines the defendants
in MVA #1 and MVA #2 are entitled to their costs, those costs be limited to ½
day of trial preparation and trial attendance. In advancing this argument, the
plaintiff asserts that the costs associated with all four actions are essentially
indivisible and that the trial time devoted to examining witnesses and evidence
exclusively linked to MVA #1 and MVA #2 was minimal.

[27]        
Counsel for the defendants submits that a fair apportionment of costs
for the MVA #1 and MVA #2 would be one day of trial preparation and trial
attendance for each case. In justifying this estimate, counsel for the
defendants lists the following witnesses as having testified with respect to MVA
#1:

a)    The plaintiff;

b)    The defendant;
and

c)     Two
medical doctors, each of whom had prepared an expert medical legal report.

[28]        
Regarding MVA #2, the following witnesses testified:

a)    The plaintiff;

b)    a friend and
work colleague of the plaintiff;

c)     An ICBC
Estimator; and

d)    Two medical
doctors, each of whom had prepared an expert medical legal report.

[29]        
I should note that it was the same two medical doctors who testified
regarding MVA #1 and MVA #2 that also addressed MVA #3 and MVA #4.

[30]        
In my view, MVA #1 and MVA #2 were the least severe of the four accidents
and most of the evidence, argument and trial time was devoted to issues
relating to MVA #3 and MVA #4.

[31]        
While it is next to impossible to calculate with certainty the amount of
trial time devoted exclusively to MVA #1 and MVA #2, in my view, a fair award
of costs for the defendants in those actions is one day of trial preparation
and trial attendance per action. The defendants in these actions will also be
entitled to their disbursements that are directly attributable to these
actions.

[32]        
The plaintiff will be entitled to nine days of trial preparation and
trial attendance for MVA #3 and MVA #4. She will also be entitled to claim all
of her disbursements, including those that may be related to more than one
action, including MVA #1 or MVA #2, such as the expert medical-legal evidence.

  Special Costs

[33]        
Generally speaking, the awarding of special costs against a party should
be reserved for those cases where the court finds the conduct of the party has
been reprehensible.

[34]        
The leading authority in British Columbia on the issue of special costs
is the oft cited case of Garcia v. Crestbrook Forest Industries Ltd.
(1994), 119 D.L.R. (4^th) 740 (B.C.C.A.). At page 747 of Garcia,
Lambert J.A. articulated the proper test for special costs as follows:

……it is my opinion that the
single standard for the awarding of special costs is that the conduct in
question properly be categorized as “reprehensible”. As Chief Justice Esson
said in Leung v. Leung, the word “reprehensible” is a word of wide
meaning. It encompasses scandalous or outrageous conduct but it also
encompasses milder forms of misconduct deserving of reproof or rebuke.
Accordingly, the standard represented by the word “reprehensible”, taken in
that sense, must represent a general and all encompassing expression of the
applicable standard for the award of special costs.

[35]        
The foundation of the plaintiff’s claim for special costs is twofold.
First, the plaintiff alleges counsel for the defendants improperly used the
clinical records of the plaintiff in his trial preparation and cross-examination
of the plaintiff. In particular the plaintiff says counsel for the defendants
“insisted on reviewing the contents of [the clinical records] with his clients,
including ICBC and the named defendants” and that his “repeated use” of the
documents during his cross-examination of the plaintiff was designed to
“embarrass and emotionally impact [her] in an unwarranted attack on her
credibility.” Second, the plaintiff alleges counsel for the defendants refused
to address the privacy and confidentiality of the records in question both
during and at the conclusion of the trial. It was this intransigence on the
part of counsel for the defendants that led counsel for the plaintiff to retain
outside counsel to assist in finding a solution.

[36]        
I do not agree with the submissions of counsel for the plaintiff on these
issues and I find his characterization of the conduct of counsel for the
defendants to be unwarranted and unfounded.

[37]        
The clinical records in question and in particular the Paragraph of
Concern were presented to the court in an unedited bound volume by counsel for
the plaintiff. That volume of records eventually became an exhibit at trial.
The materials contained in the exhibit had been disclosed to the defendants at
the pre-trial document discovery stage pursuant to the principles articulated
in Halliday v. McCulloch (1986), 1 B.C.L.R. (2d) 194 (C.A.).

[38]        
I addressed the nature of these records at paras. 73 to 76 and 150
of my Reasons for Judgment:

[73]      During all of 2006,
Ms. Keenan continued to participate in psychological and psychiatric
counselling and treatment. Ms. Keenan was still struggling to address a
host of emotional issues, including those arising from her early childhood. She
was also attempting to address the more recent stresses that resulted from the
failure of her marriage as well as the troubles she was having with her former
husband and her daughter, and certain relationship difficulties she was having
with Mr. Dorish.

[74]      Ms. Keenan saw a psychologist
15 times between August 2006 and July 2008.

[75]      The psychologist’s
clinical records as well as those relating to Ms. Keenan’s psychiatric
counselling were reviewed with Ms. Keenan in cross-examination.
Ms. Keenan explained that her seeing a psychologist and a psychiatrist had
nothing to do with the motor vehicle accidents of 2006 and she had little to no
recollection of ever discussing the accidents with any of them.

[76]      In cross-examination,
Ms. Keenan agreed that she regularly discussed with her therapists the
strains that were present in her relationship with Mr. Dorish, the
difficulties she was having with her daughter, and the frustrations she felt at
work, and acknowledged that those personal stresses had nothing to do with the
motor vehicle accident injuries she suffered in 2006. Ms. Keenan also
candidly agreed that she continues to deal with her childhood issues and that
her treatment will likely be long-term.

. . .

[150]    Ms. Keenan was
cross-examined at length with respect to the psychiatric and psychological
counselling and therapy she has undergone since 2005. While there is no need to
go into the details of that evidence, I accept that Ms. Keenan has been
addressing serious personal issues arising from her childhood and from the termination
of her marriage, and that these issues continue to cause difficulties in her
personal and professional life. In other words, I find these very real and
important personal issues have contributed directly to Ms. Keenan’s loss
of enjoyment of life.

[39]        
In my respectful view, the documents in question were relevant as each
of the plaintiff’s actions included a claim for “emotional injuries resulting
from the four motor vehicle accidents, including depression, anxiety and
apprehension, and nervous tension and shock.” This meant the plaintiff had placed
her mental health in issue at trial. In order to properly defend his clients,
counsel for the defendants was required to cross-examine the plaintiff on her
mental health, including any pre-existing conditions. In my opinion counsel for
the defendants did not use the records in any inappropriate manner. Moreover, I
find counsel for the defendants acted in a proper and professional fashion
during his cross-examination of the plaintiff. His questioning of the plaintiff
was conducted in a careful and respectful way and with the care expected of
counsel in such situations. Counsel for the defendants did not refer to or use
the Paragraph of Concern during cross-examination and I accept that was a
conscious and considered decision on his part reflecting his understanding and
appreciation of the sensitive nature of the record.

[40]        
Counsel for the plaintiff criticizes counsel for the defendants for the
amount of time he spent cross-examining the plaintiff about her mental health
issues. I find that criticism to be groundless. The plaintiff was seeking a
significant award for loss of future earning capacity. This claim was partially
based upon the assertion that the plaintiff had suffered psychological injuries
and depression as a result of the accidents. In my respectful opinion, the cross-examination
of the plaintiff was not protracted, nor did it delve improperly into clearly
irrelevant areas.

[41]        
I find the plaintiff’s assertion that counsel for the defendant insisted
on reviewing the plaintiff’s clinical records, including the record containing
the Paragraph of Concern, with the individual defendants to be equally
unfounded. In his submissions on this point, counsel for the defendants clearly
indicates that “At no time did counsel for the Defendants discuss any of the
contents of [the clinical records] never mind the ‘record of concern’ with the
Defendants.” I accept the submission of counsel for the defendants on this
point.

[42]        
There was little to no discussion between counsel at the pre-trial stage
regarding any proposed use of the clinical records at trial and more
importantly any privacy concerns the plaintiff had regarding those documents. Why
that was the case, I do not know. Counsel for the plaintiff knew counsel for
the defendants had the records in question, including the Paragraph of Concern,
for he had disclosed them to counsel for the defendants. It would have been
quite simple, and I suggest quite proper, for counsel to discuss the issue of
any intended use of these records prior to trial and to raise the plaintiff’s
privacy concerns at that point; however that did not occur. The issue did not
come to the forefront until counsel for the plaintiff, during the course of the
trial, attempted to enter the clinical records into evidence. This came as a
surprise to counsel for the defendants and the resulting argument over the
records consumed a significant amount of trial time. If there is fault to be
attributed for the manner in which the records were managed in court and the
amount of trial time devoted to resolving the issue of securing the privacy
interests of the plaintiff, then I find most of that fault lies at the feet of
the plaintiff and her counsel.

[43]        
In my respectful opinion, the plaintiff’s position regarding special
costs is meritless. Counsel for the defendants was properly cautious in his use
of the records and did nothing with them that could be categorized as reprehensible.

  Expenses Related
to the Services of Outside Counsel

[44]        
The plaintiff claims as part of her special costs or as an associated disbursement,
the cost of retaining the services of outside counsel as well as the cost of
the transcripts of proceedings at trial that her counsel ordered.

[45]        
Rule 14-1(5) of the Supreme Court Civil Rules governs the
question of disbursements:

Disbursements

(5)        When assessing costs
under (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.

[46]        
The question of whether the fees paid to outside counsel by one party to
a dispute are claimable disbursements was considered in Baiden v. Vancouver
(City), 2010 BCCA 375. In rejecting the claim, the court held at para. 25:

[25]      The limited authority
on this issue in this province supports the view that if counsel retains
another lawyer to perform a specialized function due to his or her own lack of
experience, it does not follow that such fees are recoverable from the opposing
party, but remains a matter between the original lawyer and his client: Noble
v. Wong, Bell v. Fantini (1981), 32 B.C.L.R. 322 (S.C.). That is a
practical and appropriate approach, and should have been followed here.
Outsourcing portions of legal work during litigation and then permitting
recovery of that lawyer’s fees as a disbursement undermines the policy of party
and party costs. While there may be cases in which this can be justified, they
would be limited and exceptional.

[47]        
Counsel for the plaintiff argues that the circumstances of this case are
“exceptional” and therefore justified the retention of outside counsel. As I
understand the submission, it is not that counsel for the plaintiff lacked the
skill to address the issue of securing the privacy of the plaintiff’s clinical records,
it was the lack of time he had to devote to the issue. Beyond the assertion
that he did not have time to devote to the issue, counsel for the plaintiff
does not explain why he did not raise the plaintiff’s concerns with counsel for
the defendants and attempt to find a satisfactory resolution with him. Nor does
counsel for the plaintiff explain why his co-counsel who was with him
throughout the trial could not have performed the role for which outside
counsel was retained.

[48]        
In my opinion, the facts of the case at bar are not so “exceptional”
that they bring the present case within the exception articulated in Baiden.

  Costs of the transcripts of the proceedings at
trial

[49]        
In his reply submissions, counsel for the plaintiff raised for the first
time the plaintiff’s request that the costs of the transcripts of the proceedings
at trial ordered and paid for by the plaintiff be considered a justifiable
disbursement. This new expense was not addressed by counsel for the defendants in
their submissions. In my opinion, if the plaintiff wishes to pursue this claim,
then she will have to do so before a registrar pursuant to Rule 14-1(5).

Summary

[50]        
In summary:

 a)       The
plaintiff is entitled to her ordinary costs and disbursement for the actions
relating to MVA #3 and MVA #4, consisting of nine days of trial
preparation and trial attendance as well as the disbursements associated with
those actions. The disbursements will include all of the claimable expenses
associated with the expert evidence the plaintiff presented at trial,
irrespective of whether that evidence also addressed the issues and claims in MVA
#1 or MVA #2;

 b)       The
defendants in the actions relating to MVA #1 and MVA #2 are entitled
to one day each for trial preparation and trial attendance, as well as their disbursements
that are solely attributable to those two actions;

 c)       The
plaintiff’s claim for special costs is dismissed;

 d)       The
plaintiff’s claim for the expenses associated with the retention of outside
counsel is denied;

 e)       The defendants have
been substantially successful on this application and therefore they are
entitled to their costs.

“G.R.J.
Gaul J.”