IN THE SUPREME COURT OF BRITISH COLUMBIA

Citation:	Cowichan Bay Contractors Ltd. v.  Insurance Corporation of British Columbia,
	2008 BCSC 1326

Date: 20081003

Docket: 05 1639

Registry: Victoria

Between:

Cowichan Bay Contractors Ltd.

Russell Lloyd Jackson

Plaintiffs

And:

Insurance Corporation of British Columbia

Defendant

Before: District Registrar Bouck

Reasons for Decision

Counsel for the Plaintiffs	J.M. Hutchison, Q.C.
Counsel for the Defendant	P.J. Penner
Date and Place of Hearing:	September 18, 2008
	Victoria, B.C.

Introduction

[1]                This appointment concerns the assessment of the defendant’s bill of costs.  The costs were awarded to the defendant following the dismissal of the plaintiffs’ claim:  see 2008 BCSC 475 and (29 July 2008), Victoria Registry.

[2]                Mr. Hutchison was unable to obtain instructions from his clients regarding the bills of costs.  Nonetheless, he raises a number of objections with respect to the tariff portion of the bill.  The disbursements are not in issue.

The Proceeding

[3]                This action flows from the involvement of the plaintiff Russell Lloyd Jackson in a three vehicle accident on October 31, 2002.

[4]                The vehicle driven by Mr. Jackson that day was owned by the plaintiff Cowichan Bay Contractors Ltd. (“Cowichan Bay”).  The Cowichan Bay vehicle collided with the rear end of a vehicle owned by Old Country Rentals Ltd. (“Old Country”) and driven by one David Neilson.  The Old Country vehicle struck, in turn, a vehicle driven by Josephine Kelly and whose occupants included Ms. Kelly’s children.  Ms. Kelly and the children suffered injuries in the accident and all brought actions against the plaintiffs claiming damages.

[5]                Mr. Jackson denied liability for the accident.  Regardless, he should not have been operating a motor vehicle that day.  Mr. Jackson’s driver’s licence was suspended at the time as a result of a conviction for impaired driving.  Accordingly, both Mr.  Jackson and Cowichan Bay were determined by ICBC to be in breach of their respective insurance policies.

[6]                Pursuant to the provisions of the Insurance (Motor Vehicle) Act, R.S.B.C. 1996, c. 231, ICBC paid $16, 417.49 to the Kelly family in full settlement of their respective personal injury claims.  In addition, ICBC paid for the repairs to the Kelly and Old Country vehicles.  The total amount paid out by ICBC for the accident related claims was $19,067.38.

[7]                ICBC agreed that regardless of this settlement, the plaintiffs had the right to maintain their denial of liability and proceed with a settlement or action to determine that liability.

[8]                In accordance with the Insurance (Motor Vehicle) Act, Mr. Jackson was asked to reimburse the defendant for the amount of the settlement monies.  Mr. Jackson paid the material damage portion of the claim “under protest” but refused to make any further payment.  The amount left outstanding was $16,317.07.

[9]                At some point, Mr. Jackson assumed that his driving privileges were no longer suspended.  However, on March 21, 2005, Mr. Jackson was stopped by the police and notified that his driver’s license had been “cancelled”.  The licence in Mr. Jackson’s possession was taken by the police.  In addition, Mr. Jackson’s vehicle was impounded.  Mr. Jackson assumed that ICBC had directed the license cancellation.  He retained counsel and commenced these proceedings.

[10]            In the statement of claim, Mr. Jackson asserts that ICBC was without authority to cancel the license.  He further asserts that he suffered embarrassment while Cowichan Bay suffered loss of contractual opportunities, among other losses.

[11]            The Statement of Claim seeks the following relief:

(a)        an interim and permanent injunction requiring the Defendant to provide a new British Columbia Driver’s License to the personal Plaintiff, without fee or cost to the Plaintiffs;

(b)        an interim and permanent injunction requiring the Defendant to deliver up the subject automobile to the Plaintiff Corporation, without fee or cost to the Plaintiffs;

(c)        general damages;

(d)        special damages;

(e)        exemplary damages; and

(f)         costs as special costs by way of indemnity of the Plaintiffs.

[12]            In conjunction with the filing of the statement of claim, the plaintiffs brought a motion seeking return of the driver’s license and the impounded vehicle.  The motion was to be heard on April 21, 2005.

[13]            The motion did not proceed.  Shortly after the action was commenced, Mr. Jackson discovered that the Superintendent of Motor Vehicles, not ICBC, had cancelled the license.

[14]            Although the Superintendent was subsequently persuaded to reinstate the license, ICBC then exercised its statutory right to refuse the reinstatement.

[15]            The issues raised by the plaintiffs in this action were novel.  The court was to decide whether there must first be a judicial determination of liability for the accident before ICBC was entitled to take steps to collect settlement monies paid to third parties.  The plaintiffs argued that in the absence of such a determination, ICBC breached its obligation of good faith to the insured plaintiffs by pursuing collection remedies, including the license cancellation.

[16]            The defendant denied the allegation of bad faith and brought a counterclaim seeking judgment on the sum of $16,317.07.

[17]            In the fall of 2006, ICBC set down a summary trial application, seeking dismissal of the plaintiffs’ claim and judgement on its counterclaim.  The application was heard by Dorgan J. on November 3, 2006.  The court dismissed the application finding that the issues were not suitable for determination under Rule 18A:  see 2007 BCSC 291.

[18]            The proceeding then came on for trial before Macaulay J. on March 25, 2008.  By this time, the defendant had delivered two Notices to Admit and the parties had prepared an Agreed Statement of Facts.  The court heard evidence about the circumstances of the accident.  However, the main issue for determination by the court required an analysis of the relevant provisions of the Insurance (Motor Vehicle) Act and its Regulations.

[19]            Macaulay J. found that the plaintiffs were at fault for the accident and that ICBC’s actions were authorized by statute.  There was no basis for the plaintiffs’ bad faith claim and the action was dismissed.  ICBC’s counterclaim was allowed.

[20]            The defendant had delivered an offer to settle on October 1, 2007.  The result at trial was arguably more favourable to the defendant than the terms contained in that offer.  Following further submissions on July 29, 2008, the court awarded double costs to ICBC for steps taken after October 1, 2007.

[21]            The defendant presented written arguments both at trial and at the costs hearing.

[22]            Mr. Penner describes this proceeding as an “exceedingly technical piece of litigation” requiring significant time in both legal research and preparation for trial.  The litigation was hard fought in the sense that Mr. Jackson was determined to go to trial “on principle”.

The Issues

[23]            The plaintiffs take issue with the number of units claimed for items 1B, 4, 7, 8, 12, 18, 26 and 26.1.  In some cases, the dispute is over 1 or 2 units.

[24]            The plaintiffs say that not a great deal of time should or need have been spent on many steps.  The factual issues were straightforward.  Admissions were obtained easily and few documents were involved.  The quantum of the counterclaim was never disputed and the pleadings are relatively simple.

[25]            Furthermore, while the issue before the court was novel, the written submissions of the parties need not have been lengthy.  The parties’ respective arguments simply took the court through the relevant provisions of the Insurance (Motor Vehicle) Act.

Discussion

[26]            The assessment of costs is governed by Appendix B to the Rules of Court.  In determining the appropriate number of units to award, the assessing officer is to have regard to the following principles:

(a)        one unit is for matters upon which little time should ordinarily have been spent; and

(b)        the maximum number of units is for matters upon which a great deal of time should ordinarily have been spent:  see s. 3(3) of Appendix B.

[27]            As stated in Practice Before the Registrar (CLE), the question the assessing officer must answer is not “How much time did the lawyer for the claiming party actually spend?” but, rather, “How much time, on a scale of 1 to X (where X is the maximum of the units the tariff provides) should a reasonably competent lawyer have spent on the work for which the costs are claimed?”

[28]            I pause to note that the counsel involved in this proceeding conducted the matter in a highly efficient and professional manner.  However, that efficiency does not translate into a higher award of units for each (or any) step.  Nor does the importance of the matter to the parties (ICBC in particular) mean higher units ought to be awarded.

[29]            The importance or complexity of the matter might be reflected in the scale of costs awarded.  The court found Scale B was appropriate in this case.

[30]            Having had an opportunity to review the court file and consider the parties’ submissions, I allow the following units for the disputed items:

1B - Correspondence, conferences, etc. – 18 units

[31]            While counsel’s conduct no doubt kept the flow of correspondence to a minimum, the nature of this litigation required more than a nominal exchange of letters and other forms of communication.  The defendant’s counsel would be expected to seek and take instructions on the various steps in the proceeding including with respect to the injunction application and a proposed amendment of the pleadings.

4 - Pleadings - statement of defence and counterclaim – 5 units

[32]            The plaintiffs’ claim was novel.  The defendant could not answer that claim with a pro forma pleading.  The statement of defence and counterclaim were, to use the colloquial, created from scratch.  Nonetheless, the factual issues to be addressed were straightforward and the drafting of the counterclaim would be a relatively simple exercise.

7 - Process for obtaining discovery of documents – 3 units

[33]            The plaintiffs produced some 30 documents in two lists of documents.  Many of the documents were issued by ICBC and thus known to the defendant.  The documents are not voluminous.

8 - Process for giving discovery of documents – 3 units

[34]            The defendant’s list of documents was not before me but contains a similar number of items, many of which are duplicative of those found in the plaintiffs’ list.

12 - Process for making admission of fact – 4 units

[35]            This item relates to the Agreed Statement of Facts.  That document is 6 pages in length and contains facts as stated in the pleadings.  The award of 4 units (2x2) recognizes that some negotiations were necessary in arriving at the admissions contained in the statement.

18 - Preparation for hearing April 21, 2005 – 2.5 units

[36]            Pursuant to s. 4(4) of Appendix B, the defendant may receive up to the maximum number of units for an application that is adjourned or does not take place for other reasons.  In the circumstances of the injunction application that did not proceed because the factual basis was found to be false, I find that a ½ day’s preparation time should be allowed.

26 - Written argument- March 25, 2008 – 12 units

[37]            The defendant has claimed the maximum number of units for its written submissions.  The court has commented favourably on these submissions.  I have had an opportunity to review the documents and acknowledge their thoroughness and high quality.  Nonetheless, an award at or near the maximum number of units for this item must be reserved for those written arguments (or series of arguments) that address the most complex factual or legal issues.  Written submissions emanating from lengthy trials involving historical aboriginal title or perhaps complex commercial disputes come to mind.

[38]            The defendant is entitled to double costs for this item (6x2).

26.1 - Preparation of an outline under Rule 51A – 2 units

[39]            This item relates to the outline prepared for the hearing before Dorgan J.  Like the written submissions, the outline prepared by the defendant’s counsel is of superior quality.  However, it is not of such complexity and length as to warrant the maximum number of units as claimed.

Conclusion

[40]            In the result, the defendant’s costs are allowed at $19,320.38.  I was not made aware of any offers to settle delivered pursuant to s. 10 of Appendix B.  Written submissions regarding the impact of such offers should be delivered to the Court scheduler’s office within 7 days of the issuance of these reasons.  If no submissions are received, I will endorse the certificate of costs delivered with the appointment.

                    “C.P. Bouck”                     

D/Registrar C.P. Bouck