Carfra Lawton LLP | Victoria BC

No Double Costs if “unduly punitive”

In Mohamed v. Intransit BC Limited Partnership, 2016 BCSC 321, the plaintiff alleged that he was injured falling on an escalator at a Skytrain station. The defendants denied that the plaintiff had even used the escalator. Before trial, the defendants formally offered to settle for a waiver of costs and disbursements, in exchange for a dismissal of the action. After a 7-day trial, the Court dismissed the case, finding the plaintiff’s evidence inconsistent and inaccurate in many respects, and finding that he had fallen on stairs, not on the escalator. The defendants were awarded costs and subsequently applied for double costs, under the rule on formal offers.

The plaintiff argued against double costs because the formal offer had not included any compensation. The Court held that an offer to settle does not have to include compensation. The plaintiff’s case was particularly weak and the defendants’ offer was reasonable in the circumstances.

The Court weighed the competing objectives of the formal offer rule, which are not to insulate an impecunious person from its consequences, but to consider the relative financial circumstances of the parties, as the rule expressly contemplates. Ultimately the Court declined to order double costs, holding that the initial costs order would already have a “stark and meaningful consequence” to the plaintiff, who was “unquestionably disabled and unable to work” as a result of a previous motor vehicle accident. This factor weighed “heavily against the defendants.”

This case highlights the challenges of defending against claims by impecunious plaintiffs.

Case law summary by: Karen Orr