A new standard for settlement proposals and settlement agreements has been set by the BC Court of Appeal . In a dispute over whether a family law case was settled the court required the trial judge to analyze the evidence of the settlement agreement in light of all the material facts to determine the entire scope of the settlement based on the evidence a reasonable person would have believed or understood was consenting to the identical terms as an earlier settlement proposal. (Dominak v. Lockhart, 2014 BCCA 432).
The main question considered in this appeal was whether there was a binding settlement agreement between the parties. The principles to be applied were discussed in Lacroix v. Loewen, 2010 BCCA 224. That case involved a settlement of a claim for damages suffered in a motor vehicle accident which included both a tort claim and a claim for accident benefits with the Insurance Corporation of British Columbia, ICBC. The chambers judge held there was a settlement of the tort claim which ICBC repudiated by insisting the settlement included the Part 7 accident benefits claims. The Court of Appeal allowed the appeal, finding there was an enforceable settlement of both tort and the ICBC benefits claimed. Paragraph 36 of Lacroix is instructive,
Not only must there be an offer and acceptance, but the evidence must be capable of demonstrating that there is an agreement on all essential terms… In interpreting a contract, what is relevant is the parties’ outward manifestations as to the scope of the whole settlement. That scope is to be assessed as a whole, on all of the material evidence, and not in individual pieces.
The chambers judge made an error by excluding the first two pages of the settlement proposal from her determination of the scope of the settlement, thus failing to analyze the evidence in light of all the material facts and to determine the entire scope of the settlement based on the evidence. As Judge Finch said at para. 37 of Lacroix, “That scope is to be assessed as a whole, on all of the material evidence, and not in individual pieces.”
The Court of Appeal allowed the appeal concluding that the parties had not agreed on the issue of the division of assets, and there was no binding settlement agreement.
Posted by Personal Injury Lawyer in Vancouver Mr. Renn A. Holness, B.A. LL.B.