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Ambiguous offers

If ICBC makes an offer, then I reject the offer and go to trial and am awarded less than the offer – will I have to pay the costs of the trial?  What if ICBC’s offer is unclear?

In last week’s decision of Park v. Donnelly 2018 BCSC 219, Mr. Justice Voith considered whether the plaintiff suffer cost consequences when the trial judgment was lower than a formal offer made by ICBC 11 days before trial. There had been a series of offers made, leading to the formal offer of $430,000.00 “old money”. The term “old money” is often used in ICBC negotiations to mean that the offer INCLUDES amounts ICBC has previously paid to the claimant. This is contrasted by “new money” offers, which are ON TOP of anything ICBC has previously paid.

The $430K offer was a formal offer, meaning that it included language permitting ICBC to bring the offer to the judge’s attention after trial to essentially say: “we offered more than this trial outcome, and this claimant should have to pay our trial costs and their own, because they failed to accept our fair offer and this trial was a waste of time”.  In considering whether the claimant should suffer costs consequences, the primary consideration was whether the claimant should have accepted ICBC’s offer, and whether the offer was clear and unambiguous.

In rejecting ICBC’s arguments and refusing to order costs consequences against the claimant, Justice Voith provided insight and suggestions about making clear, unambiguous offers:

[55]        An offer to settle should be clear and unambiguous. It should use plain language. It should avoid colloquialisms or idioms that are understood by a limited audience. These largely self-evident propositions are all the more important if one considers the potentially serious double cost consequences that Rule 9-1(5)(b) can give rise to.

[61]        Finally, I do not consider that expressions such as “old money” or “new money” are terribly helpful. In this case counsel, both of whom are experienced, were unable to address certain questions I had about the content of these expressions and disagreed on other issues. I consider, particularly in circumstances where the Insurance Corporation is making an offer, that it should fix, with some precision, what money it is offering and what money it says it has paid or advanced to a plaintiff. My impression, from having overseen numerous such trials, is that plaintiffs will have often failed to carefully track the various forms of payment or benefits that they may have received from the Insurance Corporation over the course of some years. The Insurance Corporation, on the other hand, will have, or should have, these figures at hand.

[62]        This can be done in one of two ways. It can either be done, as was the case in Anderson, by providing an offer that tells a plaintiff exactly what net amount he or she will receive apart from Part 7 benefits or other advances. Alternatively it can be done, as was the case in Kerpan v. Insurance Corporation of British Columbia and Henry’s Autobody Inc. et al. and Lambert et al., 2007 BCSC 203, by identifying what precise amounts have been paid…

[65]        I consider that the Offer was ambiguous. I do not consider that I need address the additional issues that are raised by the application of Rule 9-1(6). Accordingly, the Third Party’s present application is dismissed…

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