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Informal offer does not revoke formal offer

In Bideci v Neuhold 2014 BCSC 1212 Abrioux J. found that a party’s informal offer to settle did not revoke their early formal offer to settle. This was different from the conclusion reached in Arsenvoski v Bodin 2014 BCSC 199.

In Bideci, the plaintiff suffered personal injuries in a motor vehicle accident. Three months before trial the defendants sent a formal offer to settle for $32,500, plus costs and disbursements, which remained open until the day before trial. Three weeks later the defendants sent an informal offer to settle for $35,000, plus costs and disbursements, which remained open for 2 days. At trial the court assessed damages at $35,100, found the plaintiff one-third at fault, for a net judgment of $23,376. The defendants sought an order that the plaintiff not get his costs from the date of the formal offer.

In distinguishing Arsenvoski, Abrioux J. found that the language of the formal offer was clear; the formal offer could only be withdrawn by written notice, and a subsequent informal offer did not revoke the formal offer. As a result, for the two days the informal offer was open, the formal offer was suspended, and after that it remained in effect until the day before trial. The defendants were awarded 25% of their costs from the date of the formal offer. Although the offer ought to have been accepted, the court found that there was a wide possible range for liability apportionment and damages.

This case shows the importance of having clear wording in a formal offer, in particular if there is any chance a court will exercise its discretion in depriving a plaintiff their costs.

Case summary by: Brian Hoffmann