If an offer to settle is not accepted within a reasonable amount of time double costs, being a punitive award, can be awarded to the successful claimant if that offer is beaten at trial. This principle applies to almost all personal injury cases including the ones in which a claimant has beat an offer to settle made to ICBC.
In this civil case the Claimant received more from the Court than their offer to settle before trial and was awarded double costs starting 6 weeks after the offer was made(Ganges Kangro Properties Ltd. v. Shepard, 2014 BCSC 1609 )
The case involved a failed residential property land transaction in which the total claim was $75,729.79. Ultimately the judge awarded $51,504.79. Despite the breach of the purchase contract the claimant had offered to accept a $10,000 deposit held by the Realtor, inclusive of costs, to settle the dispute and avoid trial expenses. As the Judge made clear starting at paragraph 26,
The plaintiff’s initial offer was an extremely reasonable proposal, and… should have accepted it without reservation. Instead, he forced the matter through a seven day trial when he knew, or ought to have known, the consequences of losing the case in the face of that offer would include the risk of double costs being awarded against him… the defendant’s failure to accept the plaintiff’s very reasonable settlement proposal requires a punitive award of double costs against the defendant.
The case of Hartshorne v. Hartshorne, 2011 BCCA 29 was referred to and establishes that:
a) Supreme Court Rule 9-1(5) and (6) encourage settlement of lawsuits by rewarding parties who make reasonable settlement offers that should have been accepted and by penalizing parties who unreasonably refuse to accept reasonable settlement offers and force matters to trial; and
b) The reasonableness of the offer depends considering various factors, including the time of the offer and whether in all the circumstances the offer should have been accepted.
ICBC personal injury cases in British Columbia usually require the court to apply the same legal analysis and this case be used to support an application for double costs. Oddly however, the judge allowed 6 weeks for consideration of the offer before double costs began. The 6 weeks was justified in this way, “I have arbitrarily chosen… the starting point for double costs which would have given the defendant approximately six weeks to consider and accept the offer.”
ISSUE: Is 6 weeks too long to be given to consider such a reasonable offer? Should winning claimants get double costs automatically from the day of the offer?
Posted by Vancouver Personal Injury Lawyer Mr. Renn A. Holness, B.A. LL.B.