COURT CASES on WHICH COURT to SUE in
When commencing legal proceedings in British Columbia for a personal injury claim arising out of a motor vehicle accident, you can either do so in Provincial Court, which has a monetary limit of $25,000.00, or in Supreme Court, where there is no such limit. Further, in Provincial Court, legal costs are not awarded.
There can arise situations where a claimant elects to proceed through Supreme Court, yet is awarded less than $25,000.00. Generally speaking, when this occurs, no legal costs are awarded. However, if the claimant can demonstrate to the Court that there was sufficient reason to sue in Supreme Court, legal costs can nevertheless be awarded if the damages award is less than $25,000.00.
In Bae v. Vasquez, the Plaintiff was injured in a rear end motor vehicle accident, and consequently brought an ICBC claim for pain and suffering. At trial, the Plaintiff was awarded approximately $12,000. ICBC’S lawyer argued that no costs should be awarded, as the matter should have been brought in small claims court, where there is a monetary limit of $25,000. The Court rejected this submission, stating that ICBC’S lawyer’s initial denial of liability, the low velocity impact (LVI) defence, and the Plaintiff’s language barriers, were sufficient reasons for the Plaintiff to sue at the Supreme Court level.
[69] I am satisfied that this case had neither legal nor factual complexities that made the Supreme Court a necessary venue. I have already referred to the fact that a jury trial was not an option in any case; and there will be no need to enforce the judgment outside of the province.
[70] In some cases, the fact that the plaintiff had difficulty with the English language; and therefore would have difficulty pursuing the claim without the assistance of counsel, has been held to be sufficient reason to proceed in Supreme Court, where the possibility of recovering costs makes it easier for a plaintiff to find counsel willing to act.
[71] Plaintiff’s counsel submits also that in this case, the defendant denied liability for the accident in the Response to Civil Claim. Plaintiff’s counsel has advised the Court that prior to the action being commenced, the defendant’s insurer had indicated:
…that due to the “minimal nature of the impact forces involved in the collision”…the Plaintiff had not sustained any “compensable injury”.
[72] The defendant did not admit liability until January 30, 2012 and even at that date, continued to maintain that the plaintiff had suffered no injury, loss, damage or expense as a result of the accident.
[73] Plaintiff’s counsel submits that because the defendant was maintaining that the plaintiff’s negligence was the sole cause of the accident, an examination for discovery of the defendant was necessary and that procedure would not have been available to the plaintiff in Provincial Court. Counsel pointed out that at the plaintiff’s examination for discovery in July 2011, she was asked questions pertaining to liability, including whether she had consumed alcohol or drugs prior to the accident; whether she was familiar with the location where the accident happened; whether her vehicle had been properly maintained and was in proper working order and whether she had a valid driver’s licence at the time.
[74] It was not until August 18, 2011 – after both the plaintiff and defendant had been examined for discovery – that defendant’s counsel wrote to plaintiff’s counsel suggesting that the action should be heard in Provincial Court and seeking the plaintiff’s consent to transfer the action to that court. Plaintiff’s counsel replied on September 21, 2011 indicating that if the trial could be heard in Provincial Court in the same time frame as the trial date set in Supreme Court – March 2012 – then the plaintiff would consider the request for a transfer. Defendant’s counsel was asked to make inquiries to determine when the trial could be heard if transferred to Provincial Court. No reply was received.
[75] Ms. Bae testified at trial with the assistance of an interpreter. She had been examined for discovery without an interpreter and at trial indicated she had misunderstood some of the questions asked of her. Ms. Bae is not an assertive individual and I am satisfied she would have had considerable difficulty pursuing this action without the assistance of counsel. Of course, parties may be and often are represented by counsel in Provincial Court, but the unavailability of costs makes it more difficult to find representation. There was a denial of liability in circumstances where normally liability would be admitted and it was reasonable for the plaintiff to wish to examine the defendant for discovery on the issue of liability – a procedure unavailable in Provincial Court.
In Gradek v Daimler Chrysler Financial Services, the Plaintiff was awarded far less than $25,000.00, yet nevertheless was awarded costs by the trial judge. The lawyer for ICBC appealed to the British Columbia Court of Appeal, arguing that the likely value of the claim is the only consideration to be taken into account when deciding whether or not there has been sufficient reason to sue in Supreme Court. The Court of Appeal, however, dismissed the appeal.
[16] The words “sufficient reason” are not defined in the Rules of Court. In their ordinary and grammatical sense, they do not suggest a specific limitation in terms of application, although it is clear that “any reason” will not do. The reason has to be “sufficient”, but there is nothing in the Rule to suggest that it has to be connected solely to the quantum of the claim. On the other hand, the words do not connote the exercise of a discretion, with its attendant deferential standard of review. That point was made by this Court in Reimann v. Aziz, 2007 BCCA 448, 72 B.C.L.R. (4th) 1, at para. 13:
[13] At the outset, I observe that the application of Rule 57(10) does not involve an exercise of discretion. For a plaintiff who recovers a sum within the jurisdiction of the Small Claims Court to recover more than disbursements, the court must make a finding that there was sufficient reason for bringing the action in the Supreme Court.
[17] In support of its position, the appellant relies on the nature and purpose of the legislative scheme which, he submits, reflect an intention on the part of the Legislature to confine the meaning of the words “sufficient reason” to reasons relating only to quantum as assessed at the outset of the claim. In that respect, it is common ground that the primary purpose of denying costs in the Supreme Court to those with monetary claims of $25,000 or less is to encourage claimants to bring their claims in Small Claims Court, with its simplified procedures and greater accessibility to judicial dispute resolution. Litigating in the Supreme Court when the amount of money involved is relatively small can be prohibitive for both the “winner” and the “loser”.
[18] I am in general agreement with the appellant’s submission in its factum (at para. 33) that the object of the small claims procedures set out in the Small Claims Act, R.S.B.C. 1996, c. 430 and Rules, B.C. Reg. 261/93 is “to provide parties, and lay litigants, in particular with an easily understandable, flexible, and less costly alternative to the Supreme Court”. I am also prepared to accept that, in most cases, the pre-trial procedures, including pre-trial disclosure of documents and expert reports, mediation services, settlement conferences and recovery of such reasonable expenses as interpreter fees, provided in the Provincial Court, will enable the parties to proceed in a cost-efficient manner to a just result. But, that will not always be the case. In this instance, for example, the trial judge was satisfied that Mr. Gradek’s circumstances required the assistance of counsel to obtain a just resolution of his claim. It is implicit in his reasons that he considered that it would be unjust to find that Mr. Gradek require counsel to properly present his claim, on the one hand, and to deny him costs which would partially offset the expense of retaining counsel, on the other. It was on this basis, in part, that he found there was “sufficient reason” within the meaning of Rule 57(10) to bring the action in the Supreme Court with its attendant relief for the successful party in costs.
[19] Without endorsing all of the factors relied on by the trial judge as constituting “sufficient reason” in this case, I am satisfied that there may be circumstances which may constitute sufficient reason for bringing an action in the Supreme Court, thereby triggering its costs provisions, despite the fact that it is apparent from the outset that the award will fall within the monetary jurisdiction of the Provincial Court. It is open to a defendant who believes that the claim should not have been brought in the Supreme Court to apply under s. 15 of the Supreme Court Act, R.S.B.C. 1996, c. 443, to have the matter transferred to the Provincial Court. Alternatively, if the matter proceeds in the Supreme Court, it is open to the defendant to ask that a successful plaintiff be denied costs on the basis that there was not sufficient reason to bring the action in the Supreme Court in the first instance.
[20] I accept that the narrow interpretation of the words “sufficient reason” advocated by the appellant would provide greater certainty to litigants in knowing the consequences of proceeding in Supreme Court where the matter falls within the Small Claims monetary limit. But I agree with the trial judge that if the Legislature had intended to limit the scope of the words “sufficient reason” to the extent suggested by the appellant, it could readily have done so. While I am satisfied that the words, “sufficient reason” should not be interpreted in an expansive manner, but with restraint, I am also satisfied that they must be read in such a way that a trial judge is not forced to deny a party costs where he is satisfied, as here, that justice can only be achieved as between the parties by an award of costs to the successful party.
In Kargbo v Chand, the Plaintiff again was awarded far less than $25,000.00 in damages. ICBC’S lawyer argued that the Plaintiff should not be entitled to legal costs, however again costs were awarded by the Court. The Court discussed what other factors come into play when deciding whether or not a claimant has sufficient reason to sue in Supreme Court.
[6] The defendant takes the position that the plaintiff is entitled to disbursements only, and not to costs. In the defendant’s submission, this is an action which ought to have been commenced in the Provincial Court of British Columbia, as there is no sufficient reason to have initiated the action in the Supreme Court, in light of the nominal award which the Court made, an award which is within the jurisdiction of the Provincial Court.
[9] The problem ultimately reduces to this: If the Court determines that the plaintiff had sufficient reason for commencing or proceeding in the Supreme Court, she should be entitled to recover costs in accordance with Rule 15-1(15). If the Court finds that there was not sufficient reason for bringing the proceeding in this Court, then she is not entitled to recover her costs.
[10] In Reimann v. Aziz, 2007 BCCA 448, the Court of Appeal clarified that the issue has to be analyzed as at the point in time that the plaintiff initiated the action; there is no ongoing obligation to assess the quantum of claim.
[11] I have been provided with a number of decisions where judges of this Court have assessed the circumstances of cases to decide whether or not an order for costs is warranted. Obviously, the plaintiff bears the onus of establishing that there was sufficient reason for filing in the Supreme Court. It is not simply a matter of assessing the anticipated value of the claim. A number of factors have been identified in the cases as being relevant to the issue. These include the following (the list is not intended to be exhaustive):
1. the legal or factual complexity of the case;
2. the need for discovery of documents and examinations for discovery;
3. the need for a judgment enforceable outside of British Columbia;
4. a bona fide preference for a jury trial;
5. access to the summary trial procedure available in Supreme Court; and
6. the need for the plaintiff to have legal counsel, in light of the defendant’s denial of liability, dispute as to causation, injury or loss and allegations of contributory negligence, pre-existing conditions, previous causes and a failure to mitigate.
[12] In the present case, liability was denied and in the circumstances could reasonably have been expected to represent a challenge to prove. As well, the issue of damages had the real potential of being a problem. The plaintiff had a history of prior accidents and had been hospitalized shortly after the accident in question for matters not related to the accident. She was also injured in another more serious accident some several months after the accident at bar. It was the sort of case that a self-represented plaintiff would find daunting no doubt.
[13] Taking those considerations into account, it is my view that this plaintiff had sufficient reason for bringing her proceeding in the Supreme Court.
[14] As a parenthetical observation, it is true that a party such as this plaintiff could elect to pursue the claim in the Provincial Court with legal counsel, although the prospect of incurring the expense to do so without any right to recover court costs is a legitimate factor to consider. As well, where the plaintiff elects to bring suit in the Supreme Court, she runs the real risk of an adverse costs outcome if the action is unsuccessful.
[15] In the circumstances, it is my view that the plaintiff should be entitled to costs in accordance with the Rules of Court. I recognize that might appear to produce a curious result in that the award of costs is substantially greater than the damages that she recovered. However, if the matter is considered fairly and objectively and the relevant rule applied, that result follows.
[16] There is no question that the policy which underpins Rule 14-1(1) is to encourage parties with claims of modest value to bring their action in the Provincial Court, and to provide for a penalty against one who does not. That is consistent with the concept of proportionality which is a foundational consideration of the Court’s Rules.
[17] The clear default position will be that, with respect to claims where the award is less than $25,000, the plaintiff will not be entitled to an award of costs. Nevertheless, there will be situations where there is sufficient reason to bring the action in the Supreme Court. It will be for the Court to examine the circumstances of each particular case to determine whether or not there is sufficient reason.
In Mehta v Douglas, the Plaintiff was awarded a damages amount less than $25,000.00. The lawyer for ICBC argued that the Plaintiff should not be awarded any amount for costs, however the Court ruled otherwise, ruling that access to Examinations for Discovery and the Summary Trial procedure were sufficient reasons for commencing the matter in Supreme Court.
[8] The plaintiff argues that at the time the action was started it was unclear what the likely claim to damages would be. She says that it is appropriate to be cautious, particularly where an infant is concerned, about the extent of damages, but an injury may cause. Moreover, being an infant, the retention of counsel is justified and indeed required. The plaintiff required the assistance of counsel to present her case properly, just as was the case in Gradek. Finally, the plaintiff contends that that was sufficient reason to start this action in this court because certain of the procedures available in this court are not available in Provincial Court. These procedures include examinations for discovery and summary trial. The availability of summary trial allowed this matter to be resolved without the need to subject a young plaintiff to the stresses of testifying. The summary trial took approximately 90 minutes of court time, rather than between one and two days that would have been needed for trial in the Provincial Court.
[9] I accept the submissions of the plaintiff. In my view, the plaintiff required counsel to present her case. It would be unjust to deny her costs that would permit her partially to defray the expense of retaining counsel. Although it would have been difficult to predict at the outset whether this matter would prove to be suitable for summary determination, the availability of examinations for discovery and the possibility of summary trial are both factors that in the circumstances of this case are sufficient to justify starting the action in this court. The availability of these procedures and their potential to promote a proportionate and efficient use of resources is something that would be known at the outset. In my view, it would be unjust to deprive the plaintiff of costs in circumstances where knowing of those procedures she has subsequently used them efficiently.
[10] Although the plaintiff did not initially plead the injuries that ultimately formed the primary basis of the summary trial, I accept that it is appropriate to be cautious in assessing what could reasonably be predicted as the quantum for a damages claim when the action is started, particularly in the case of an infant. While on the facts that were known concerning the minor nature of the plaintiff’s soft tissue injuries and the speed with which they had resolved, it would have been unlikely that the award would exceed the small claims jurisdiction, but the exact value of the claim nevertheless could not be predicted accurately. Given the uncertainties facing the plaintiff at the time she started the action, it was not unreasonable to start it in this court.
[11] Taking all of these factors into account, I am of the view that the plaintiff had sufficient reason to start this action in this court and accordingly she is entitled to her costs in accordance with Schedule B.
