IN THE SUPREME COURT OF BRITISH COLUMBIA

Date: 20140805

Docket: M125667

Registry:
Vancouver

Between:

Keith Barnes

Plaintiff

And

Kirk Lima

Defendant

Before:
The Honourable Mr. Justice G.C. Weatherill

Reasons for Judgment on Costs

[1]            
The plaintiff applies for double costs after Reasons for Judgment were
pronounced in this action.

[2]            
The action arose from injuries sustained by the plaintiff in a motor
vehicle accident. It was commenced on September 18, 2012. It was a fast
track action commenced under Rule 15-1 of the Supreme Court Civil Rules,
B.C. Reg. 168/2009 (the “Rules”). The trial was heard on June 24 to
26, 2014. It lasted 3 days. My Reasons for Judgment were pronounced on July 11,
2014, indexed as 2014 BCSC 1282. The plaintiff was awarded $67,214.19.

[3]            
On June 23, 2014, the morning before commencement of the trial, the
plaintiff communicated a formal offer to settle the claim for $60,000 plus
reasonable disbursements. The offer was stated to be open for acceptance until that
same afternoon at 4 p.m. The defendant did not respond to that offer, although
it had responded to earlier settlement offers from the plaintiff including by
making his own formal offer to settle for $39,651.69 plus funding for 12 active
rehabilitation sessions.

[4]            
The parties are in agreement that, if double costs are awarded, the
plaintiff will only be entitled to an additional $5,040, including taxes, under
Rule 15-1.

[5]            
The applicable rules are Rules 9-1(5) and (6) of the Rules:

Cost options

(5) In a proceeding in which an offer to settle has been
made, the court may do one or more of the following:

(a) deprive a party of any or all
of the costs, including any or all of the disbursements, to which the party
would otherwise be entitled in respect of all or some of the steps taken in the
proceeding after the date of delivery or service of the offer to settle;

(b) award double costs of all or
some of the steps taken in the proceeding after the date of delivery or service
of the offer to settle;

(c) award to a party, in respect of
all or some of the steps taken in the proceeding after the date of delivery or
service of the offer to settle, costs to which the party would have been
entitled had the offer not been made;

(d) if the offer was made by a
defendant and the judgment awarded to the plaintiff was no greater than the
amount of the offer to settle, award to the defendant the defendant’s costs in
respect of all or some of the steps taken in the proceeding after the date of
delivery or service of the offer to settle.

Considerations of court

(6) In making an order under subrule (5), the court may
consider the following:

(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.

[6]            
Both counsel made extensive submissions regarding how the Court’s
discretion should be exercised in this case.

[7]            
The plaintiff relies on the policy underlying Rules 9-1(5) and (6), which
is to encourage early settlement of lawsuits by rewarding parties who make
reasonable settlement offers that should have been accepted and correspondingly
penalizing parties who should have accepted reasonable settlement offers: Hartshorne
v. Hartshorne, 2011 BCCA 29 at para. 25.

[8]            
The reasonableness of the settlement offer is to be assessed by
considering such factors as the timing of the offer, whether it had some
relationship to the claim (as opposed to simply being a “nuisance offer”),
whether it could be easily evaluated, and whether some rationale for the offer
was provided: Hartshorne, at para. 27.

[9]            
I have considered how the offer compares to the amount ultimately
awarded after trial. The award at trial was only $7,214.19 more than the plaintiff’s
offer. As matters transpired, it turned out to have been a reasonable offer,
although it was a short-fuse offer made on the eve of trial. It should have
been made weeks earlier. Be that as it may, it was straight forward and
contained no ambiguities. Counsel for the defendant candidly acknowledged that
his client had sufficient time before the trial in which to consider it. However,
the fact that the award at trial was greater than the offer is not
determinative: Ward v. Klaus, 2012 BCSC 99 at para. 46. The
reasonableness of a decision not to accept an offer to settle must be assessed
not by reference to the award that was ultimately made but rather the
circumstances existing when the offer was open for acceptance: Ward, at para. 36.

[10]        
On the eve of the trial, the defendant had a legitimate defence to the plaintiff’s
claim, particularly his claim for loss of capacity which in his earlier communications
to the defendant the plaintiff had indicated was significant. The plaintiff did
not break his settlement offer into its components and provided the defendant
with no ability to assess how much of it was to compensate the plaintiff for
his loss of capacity claim. At the time the offer was communicated, there was a
reasonable possibility that the plaintiff would not recover anything for that
claim, which ultimately proved to be the case. It was reasonable for the
defendant to wish to test the plaintiff’s position that his inability to work
overtime at Carter Motors was due to the accident and not to other factors such
as his marriage, particularly in the absence of supporting documentation.

[11]        
Moreover, most of the plaintiff’s injuries were soft-tissue in nature. He
had a pre-existing right shoulder injury. There were live issues regarding
whether the plaintiff’s T-4 vertebra fracture had healed and, if so, when, as
well as the plaintiff’s credibility relating to the extent that his injuries
had affected his life. Parties should not be unduly deterred from bringing
meritorious, but uncertain, defences because they fear a punishing costs order:
Currie v. McKinnon, 2012 BCSC 1165 at para. 20.

[12]        
In addition, the plaintiff provided the defendant with several
photographs of the plaintiff’s carpentry skill but gave no explanation for how
he intended to rely upon those photographs until after his settlement offer had
expired.

[13]        
The court has a broad discretion when determining the issue of costs: Ward
at para. 33.

[14]        
In my view, having considered all of the foregoing circumstances, the
offer was not one that the defendant ought reasonably to have accepted.

[15]        
I am exercising my discretion against the plaintiff. There will be no
award of double costs. The plaintiff is entitled to his costs on Scale B as
though his settlement offer was not made.

[16]        
There will be no costs of this application.

_________ “G.C.
Weatherill J.”_________
G.C. Weatherill J.