This is a review of an award of double costs against an ICBC insured for failure to accept a reasonable offer of settlement( J.D. v. Chandra,2014 BCSC 1272) . This successful personal injury claimant offered to settle her ICBC case for $200,000 after attending a Judicial Settlement Conference. The Insurance Corporation of British Columbia, ICBC, rejected the offer electing to fight the case in Court. The Judge awarded the injury claimant over $500,000.
The claimant was a student at the time of her injuries and did not have any significant income that would have afforded her the luxury to ignore the risks of a Supreme Court trial. On the other hand, the defendants were represented by ICBC, a well-financed auto insurance company which could afford to take the risks of any type of trial.
At trial the claimant was found to have suffered soft tissue whiplash type injuries to her back, neck and right shoulder in two motor vehicle accidents. In the first car crash the claimant was driving through an intersection when another driver hit into the side of her vehicle. In the second accident the claimant was rear ended while waiting in a line of stopped traffic.
Rule 9-1 of the Supreme Court Civil Rules allows the judge to award the claimant double costs of a lawsuit after making an offer to settle, pursuant to Rule 9-1(5)(b). This takes into account that the claimant would normally be entitled to costs of success at trial. By doubling the costs after delivery of the offer to settle, the claimant is awarded an additional set of costs for having made reasonable efforts to settle.
Given the relationship between the terms of settlement offered and the final judgment of the court, there is no question that the claimant obtained a final judgment that was better than her offer. She offered to settle for $200,000 plus costs and the trial award was more than double this.
However, ICBC argued that the court should take into account the comments of the judge at the Judicial Settlement Conference regarding the risks of an award for future loss of earning capacity, and that the judge presiding suggested the risks were greater to the claimant than the defendant on that issue. ICBC suggested that this means the defendants were reasonable in not accepting the claimant’s offer.
The Judge Griffin rejected this argument for several reasons including,
[29] There are strong policy reasons for not considering judicial comments at a settlement conference when taking into account the reasonableness of a party’s position in rejecting a formal offer to settle. To find otherwise would seriously inhibit the candour of all parties at a settlement conference. It could turn judicial settlement conferences into an opportunity for parties to strategically shape their submissions for the ultimate goal of using the resultant judicial remarks against the other in later costs’ applications. This kind of costs-seeking strategy should not be the focus or side-effect of a judicial settlement conference. Rather, the focus should be on trying to settle the case.
If formal offers to settle are made by a party at or after a judicial settlement conference, these can be considered by the court but a party should not pick and choose a judge’s comments from a judicial settlement conference to support the positions they took in respect of offers to settle.
The offer to settle her soft tissue injury case ought to have been accepted and the claimant was therefore awarded double costs for the trial and regular costs prior to trial. ICBC knew that the claimant was not in a financial circumstance to take the risk of losing at trial but ICBC chose to fight the case in court anyway.
The message from this case for personal injury lawyers is that Judicial Settlement Conferences should not be used as a costs seeking strategy but rather as a process to attempt settlement of the case. Evaluating how much money should be awarded in a personal injury claim and making formal offers before and after a settlement conference will be taken into account when assessing costs, but the judicial comments at a Judicial Settlement Conference are not to be considered.
Posted by Vancouver Personal Injury Lawyer Mr. Renn A. Holness, B.A. LL.B.– Serving all BC.