Welder v. Lee

2019 BCSC 1973 Welder v. Lee

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Welder v. Lee, 2019 BCSC 1973 Date: 20191119 Docket: M173440 Registry: New Westminster Between: Paul Edward Welder Plaintiff And Kuo Lee Defendant Before: The Honourable Madam Justice Devlin Reasons for Judgment on Costs Counsel for the Plaintiff: J.M. Cameron P.J. Bosco Counsel for the Defendant: S. Amendolagine A. Pappin Place and Date of Hearing: New Westminster, B.C. November 6, 2019 Written Submissions Received: October 8, 2019 October 30, 2019 November 4, 2019 Place and Date of Judgment: New Westminster, B.C. November 19, 2019 Introduction [1] In my Reasons for Judgment, dated August 9, 2019, indexed at 2019 BCSC 1328 (the "Trial Reasons"), I awarded the plaintiff in this motor vehicle case damages and gave the parties leave to file written submissions on the matter of costs. The plaintiff, Mr. Welder, filed written submissions on October 8, 2019 seeking an order that the defendant, Mr. Lee, pay the plaintiff costs at Scale B for the steps taken up to and including the date the plaintiff served an offer to settle with double costs after that. On November 4, 2019, Mr. Welder's counsel filed an addendum to his submissions on costs to seek costs for the role of two counsel. [2] The defendant opposes the relief sought, claiming that causation and the evaluation of past and future income earning capacity was difficult to

evaluate due to the complexity of the case and the number of variables. [3] At trial, the plaintiff succeeded in obtaining a judgment totalling $453,096 for non-pecuniary damages, past loss of earning capacity, loss of future earning capacity, costs of future care and special damages. Liability was admitted and the central issues concerned the nature of Mr. Welder's injuries and the assessment of damages. The defendant acknowledged that Mr. Welder sustained some injuries as a result of the accident, but argued the injuries were relatively minor and caused Mr. Welder only a brief period of disability. The defendant argued that Mr. Welder did not lose any income earning capacity and instead chose to pursue his claim for damages as a business opportunity. Background Facts [4] The plaintiff was injured in a motor vehicle accident on September 23, 2013. The defendant rear-ended the plaintiff who was waiting for a car ahead to turn left. At the time, the plaintiff was a successful and well-respected tower crane operator. As a tower crane operator, the plaintiff worked long hours for five days a week with substantial over-time. The plaintiff sustained soft tissue injuries in his neck. Flexing his neck for extended periods of time exacerbates the pain. As a result of his injuries, the plaintiff was unable to continue to work as a tower crane operator. However, the plaintiff

successfully developed his business, Centre Point, by relying on his reputation in the construction industry. Centre Point continues to supply tower crane operators and crew to various construction sites. The Settlement Offers [5] On April 30, 2019 the defendant made an offer to settle in the amount of $300,000 (the "Defendant's Offer"). [6] On May 8, 2019 the plaintiff made an offer to settle in the amount of $420,000 (the "Plaintiff's Offer"). [7] The 12-day trial commenced on May 29, 2019 and completed on June 26, 2019. The Legal Framework [8] Rule 9-1 of the Supreme Court Civil Rules [Rules] provides a procedure by which a party may be subject to costs consequences in the event that an offer to settle is made but not accepted. The relevant provisions of the Rules are as follows: Rule 9-1 - Offers to Settle (1) In this rule, "offer to settle" means (c) an offer to settle made after July 1, 2008 under Rule 37B of the former Supreme Court Rules, as that rule read on the date of the offer to settle, or made under this rule, that (i) is made in writing by a party to a proceeding, (ii) has been served on all parties of record, and (iii) contains the following sentence: "The ............[party(ies)]............, ............[name(s) of party(ies)]............, reserve(s) the right to bring this offer to the attention of the court for consideration in relation to costs after the

court has pronounced judgment on all other issues in this proceeding." (4) The court may consider an offer to settle when exercising the court's discretion in relation to costs. (5) In a proceeding in which an offer to settle has been made, the court may do one or more of the following: (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; (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. [9] With respect to the purpose underlying these provisions, our Court of Appeal stated in Hartshorne v. Hartshorne, 2011 BCCA 29 [Hartshorne] at para. 25 that: [a]n award of double costs is a punitive measure against a litigant for that party's failure, in all of the circumstances, to have accepted an offer to settle that should have been accepted. Litigants are to be reminded that costs rules are in place "to encourage the early settlement of disputes by rewarding the party who makes a reasonable

settlement offer and penalizing the party who declines to accept such an offer" (A.E. v. D.W.J., 2009 BCSC 505, 91 B.C.L.R. (4th) 372 at para. 61, citing MacKenzie v. Brooks, 1999 BCCA 623, Skidmore v. Blackmore (1995), 2 B.C.L.R. (3d) 201 (C.A.), Radke v. Parry, 2008 BCSC 1397) [10] I will now turn to my analysis of the issues. Analysis [11] As set out above, R. 9-1(6) of the Rules lists certain relevant factors to consider in deciding whether to make an award for double costs under R. 9-1(5). I will consider those factors in my analysis. (a) Whether the offer to settle was one that ought reasonably to have been accepted, either on the date that the offer was delivered or served or on any later date? [12] As set out in Hartshorne at para. 27, this factor is one where "the court must determine whether, at the time that the offer was open for acceptance, it would have been reasonable for it to have been accepted". It would be improper for this Court to consider the judgment awarded as a factor in this analysis; the question is concerned with what was reasonable at the time the offer was extended 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". [13] In this case, the defendant had ample

time between the Plaintiff's Offer and the start of trial to evaluate the offer. By that time the defendant received all the plaintiff's medical legal reports. Discoveries were complete. Despite some differences in opinions among the plaintiff's two experts and the defendant's expert, all the experts agreed that the plaintiff's ability to operate a tower crane was compromised by the accident injuries. In particular, the defendant's expert Dr. Tessler agreed with the plaintiff's expert Dr. Cameron that it was reasonable for Mr. Welder to adapt himself to a new role once he could no longer perform the duties of a tower crane operator. The defendant had this information. [14] The defendant submits that given the particular circumstances of this case, both causation and the evaluation of past and future loss of income earning capacity were difficult to assess. However, during the hearing of this matter the defendant acknowledged his careful assessment of the merits of the case, including a consideration of causation and of the loss of income earning capacity when formulating the Defendant's Offer. If the defendant was able to evaluate the contingencies and variables of this case in forming the Defendant's Offer, I don't see why he would have had any special difficulty in navigating those complexities in respect of the Plaintiff's Offer. The defendant's reliance on Brooks-Martin v.

Martin, 2011 BCSC 497 [Brooks-Martin] in support of his position that this case was one in which reasonable lawyers could disagree, is misplaced. The facts in Brooks-Martin are easily distinguished from those before this court. The plaintiff in Brooks-Martin sued the corporate defendant over its role in tracking and cleaning-up loose gravel that the plaintiff argued contributed to the motor vehicle accident in which she sustained injuries. The Court found that the defendant did not owe a duty of care to the plaintiff. The plaintiff rejected the corporate defendant's repeated suggestions to sue the municipality instead of them, and to proceed to summary trial. The corporate defendant extended the plaintiff an offer to settle of $1.00 plus her costs on Scale B. She rejected it. The defendant sought double costs against the plaintiff. The Court declined its claim. In doing so, Halfyard J. reasoned under the factor of whether the plaintiff ought reasonably to have accepted the offer, the issue of liability vis-à-vis the corporate defendant was one on which reasonable lawyers could disagree. Moreover, the corporate defendant's offer of $1.00 did not represent a "genuine incentive" to settle (at para. 37). No factual aspect grounding the reasoning behind Halfyard J.'s rejection of the double-costs application bears any similarity to the facts and the issues in this case. The question

of whether the injuries affected Mr. Welder's income earning capacity was ascertainable on the basis of the evidence before the defendant at the time of the Plaintiff's Offer. [15] The defendant had 21 days to consider the plaintiff's offer. The plaintiff's offer of $420,000 represented a genuine incentive to settle. All the medical experts concurred that Mr. Welder's injuries compromised his ability to work as a tower crane operator. There was no complicated set of facts to unwind before determining causation. [16] After considering all the information available at the time the defendant received the Plaintiff's Offer, I find that the Plaintiff's Offer was one that ought reasonably to have been accepted. (b) The relationship between the terms of settlement offered and the final judgment of the court [17] As stated earlier, the Plaintiff's Offer was for $420,000, or $33,096 less than what was awarded after trial. I find this factor weighs in favour of taking the Plaintiff's Offer into account. (c) The relative financial circumstances of the parties [18] The plaintiff submits that the relative financial circumstances of the parties is not particularly pertinent because the defendant's insurer conducted the defence. The notion that "ICBC's greater financial clout" is necessarily a significant factor was rejected in Gonzales v. Voskakis, 2013 BCSC 675 at para. 39, by Fitzpatrick

J. who cautioned that "although ICBC is well-funded, its resources largely come from the premiums of many individual insurers, who expect that these funds will be managed for the benefit of the insurance system as a whole." However, I find no support for the defendant's argument that the plaintiff is relatively well-off and that therefore double costs would not alleviate any financial difficulties. I find this to be a neutral factor. [19] Further, given all of the information available to evaluate the Plaintiff's Offer at the time it was received in this case, I consider it relevant that the insurer conducted the defence. As stated by Madam Justice Brown in Kostinuk v. Fellowes, 2015 BCSC 2327 at para. 13 "the defence was conducted by the insurer who was well able to assess the risks of proceeding to trial" (see also Smith v. Tedford, 2010 BCCA 302 at para. 19). The risk of double costs where the plaintiff succeeds would not have escaped the insurer's consideration in assessing the risks of proceeding to trial. (d) Other factors [20] The defendant argued I should consider the actual length of time spent in trial as a factor in deciding the plaintiff's application. The defendant takes issue with the plaintiff's claim that trial took 12 days given that on some days the court did not sit a full day. In my view, the actual calculation of the costs is not a factor for me to consider

in determining whether to exercise my discretion under Rule 9-1. Costs for Two Counsel [21] Although the plaintiff raised the issue of costs for two counsel in the addendum to his written submissions he did not pursue this issue during the hearing. Therefore, it is not necessary for me to decide the issue. Conclusion [22] After considering all of the relevant factors in this case I am satisfied that the plaintiff is entitled to his costs, and he is entitled to an award of double costs at Scale B from the date of the Plaintiff's Offer to the end of trial. "Devlin J."