Petz v Duguay, 2017 ABQB 577

Court of Queen’s Bench of Alberta Citation: Petz v Duguay, 2017 ABQB 577 Date: 20170926 Docket: 0401 18177 Registry: Calgary Between: Shelly Ann Petz and David Torrie Plaintiffs - and - Patrick Duguay Defendant _______________________________________________________ Ruling on Costs of the Honourable Mr. Justice W.P. Sullivan _______________________________________________________ Introduction [ 1 ] This is the decision on costs and pre-judgment interest in a personal injury action arising out of an accident on September 12, 2004.

I rendered judgment after trial in this matter on February 10, 2017 for the Plaintiff, Shelly Ann Petz, in the amount of $76,028 for general damages, loss of income, and special damages. My decision is reported at 2017 ABQB 90 . The parties have been unable to agree on the issues of pre-judgment interest and costs. Issues [ 2 ] The issues to be determined are the amount to be awarded for pre-judgment interest and the appropriate costs award to be granted. Pre-judgment Interest

[ 3 ] At the costs hearing on July 27, 2017, the parties raised the additional issue of when pre-judgment interest would start to run. [ 4 ] Pre-judgment interest is addressed in the Judgment Interest Act , RSA 2000, c J-1, where

section 2 provides, in part: 2(1) Where a person obtains a judgment for the payment of money or a judgment that money is owing, the court shall award interest in accordance with this Part from the date the cause of action arose to the date of the judgment. ...

(3) If it considers it just to do so having regard to changes in market interest rates, the circumstances of the case or the conduct of the action, the court may (

a) refuse to award interest under this Part, (

b) award interest under this Part at a rate higher or lower than the rate set out in this Part, or (

c) award interest under this Part for a period other than the period provided for in this Part. [ 5 ] At the hearing, Counsel made submissions and there was a discussion between Counsel and the Court. I conclude the Plaintiff is entitled to pre-judgement interest from the date of the accident on the non-pecuniary damages only, as interest was already included in the loss of income calculation. I fix the pre-judgment interest amount at $25,975.70.

Costs [ 6 ] The dispute between the parties over costs relates to the impact of offers to settle made by the Defendant. [ 7 ] In this case, the Defendant served two Formal Offers to Settle on the Plaintiff pursuant to Rule 4.24(2) of the Alberta Rules of Court , Alta Reg 124/2010, which sets out the requirements for formal offers to settle. The first, on November 14, 2013, was an offer to settle this claim for an amount in excess of what the Court ordered after trial.

On October 14, 2016, ten days before the trial of the matter, the Defendant again offered to settle the action for an amount that exceeded the award of the Court.

Both offers were for cash amounts, plus costs and interest. [ 8 ] The Plaintiff acknowledged service of the first offer in her Affidavit sworn on June 10, 2015 at para 17: On or around November 28, 2013, counsel for the Defendant had forwarded a Formal Offer of Settlement in the amount of $220,000.00 plus costs and interest. [ 9 ] Service of the second offer prior to the trial was admitted by counsel for the Plaintiff during oral submissions. [ 10 ] Although the Plaintiff succeeded at trial, the award granted was less favourable than either of the Defendant’s formal offers to settle.

The cost consequences in this situation are set out in Rule 4.29(2) of the Rules :

(2) Subject to subrule (4), if a defendant makes a formal offer to settle that is not accepted and a judgment or order in the action is made that is equal to or more favourable to the defendant than the offer, the defendant is entitled to costs for all steps taken in the action in relation to the action or claim after service of the offer. [ 11 ] An application of the rule quoted above, declares that the Defendant is entitled to costs for all steps taken in the action in relation to the action or claim after service of the offer. [ 12 ] Costs are always discretionary, and there is no absolute entitlement to costs set out in

Schedule C: LL v GB , 2009 ABQB 322 at para 50 , aff’d 2009 ABCA 356 , Dechant v Law Society of Alberta , 2001 ABCA 81 , leave to appeal to SCC refused, 28293 (4 October 2001).

Further, “[t]he threat of costs is always an important factor in the settlement process, and without this “hammer”, there is less of a disincentive to litigate”: LL , supra and Dechant , supra . [ 13 ] In the circumstances of this case I find no reason to deviate from the rule 4.29(2) and therefore award costs to the Defendant from the date of the first offer of settlement November 14, 2013. [ 14 ] In the Defendant’s bill of costs he sets out his disbursements as totalling $5,596.59 for the period from the date of the offer to the completion of the trial.

In addition, he sets out costs with respect to consultants and experts and payments made by the Defendant to the Plaintiff to obtain expert reports and those cost a total of $58,125.51. The Defendant claims a total GST cost of $7,205.08. These costs and disbursements are allowed. [ 15 ] For fees, the Defendant claims the amount of $81,300.00 based on column 4 of

Schedule C to the Rules . Column 4 is the appropriate column as the Plaintiff claimed that she was entitled to damages in excess of $1,000,000.00. I find that this is the appropriate column. I also find that the requirement to call experts at the trial was necessary for a full examination of the facts and the condition and claim of the Plaintiff. [ 16 ] The Court may exercise its discretion to award a lump sum for all or a portion of

Schedule C costs. In the interest of bringing this matter to a conclusion and to avoid necessity of taxation, and exercising my discretion, I award fees in the amount of $60,000.00 plus GST in the amount of $3,000.00. The total award for costs and disbursements payable to the Defendant is $133,927.18. [ 17 ] Any advances made by the Defendant to the Plaintiff during the course of this litigation after November 14, 2013 will be deducted from the amount of the judgment following trial.

Heard on the 27 th day of July, 2017. Dated at the City of Calgary, Alberta this 26 th day of September, 2017. W.P. Sullivan J.C.Q.B.A. Appearances: Edward Tawkin for the Plaintiffs Justine Blanchet for the Defendant