26 Apr ICBC Ordered to Pay Double Costs in Arsenovski Case

You may have seen the recent news report where ICBC was ordered to pay almost $400,000 in damages to a plaintiff that the corporation had falsely accused of fraud. http://www.cbc.ca/news/canada/british-columbia/icbc-malicious-prosecution-1.3473693

Costs are awarded to the litigant who is successful at trial. An award of costs is meant to offset the expense of the trial, as well as encourage the parties to settle prior to trial. Double costs, on the other hand, are intended to punish a party who rejects a reasonable offer.

In 2011, several years before trial, the Plaintiff offered to settle her malicious prosecution case against ICBC for $78,000. ICBC countered with an offer to settle for $10.00 and a waiver of costs. ICBC maintained this $10.00 offer up to the date of trial. Just before trial the plaintiff reduced her offer to settle down to just $24,913.33.

Madam Justice Griffin held that in light of the judgement awarding almost $400,000 in damages to the plaintiff, ICBC’s refusal to accept the first formal offer of $78,000 was unreasonable. ICBC submitted that it was not unreasonable for them to reject the offer to settle since the plaintiff’s decreasing offers showed that she and her counsel did not believe her claim had merit. The Court rejected this argument and noted that there are many reasons why the plaintiff might have been willing to settle, including the fact that a trial was an intimating and foreign process which would be a public airing of ICBC’s assertion that she had acted fraudulently.

The Court ordered ICBC to pay ordinary costs up until the 2011 offer was made, and double costs from June 16, 2011 onward.

In her judgement Madam Justice Griffin stated:

“The purpose of increasing costs consequences for refusing a reasonable offer to settle is to create an incentive for settlement and to deter the taking of unreasonable positions in litigation. This serves the broader public purpose of the efficient and proper administration of justice.”

The exact amount of this double award of costs has not been disclosed but it will likely prove very costly for ICBC. ICBC will have to pay almost twice what they would otherwise have had to pay in costs.

Being able to exercise good judgement is important when negotiating personal injury cases.  That is what we provide at Acheson Sweeney Foley Sahota, Personal Injury Experts.