Trials, Costs and Unpredictable Jury Awards

In the recently published case of Mazur v. Lucas, 2011 BCSC 1685, Madame Justice Humphries considered the cost consequences of a plaintiff’s failure to beat a formal offer. The plaintiff had been awarded $528,400 in a jury trial. ICBC was able to successfully appeal the decision on a technical issue related to an expert report tendered at trial and secured a new trial. Ironically, the point on which the defendants were successful on appeal was not taken up at the second trial. The second trial proceeded to a large degree, the court noted, as the first trial had. However, the jury in the second trial awarded the plaintiff only $84,000. Prior to the trial ICBC’s lawyer had made an offer of $300,000.

 

Both parties sought their costs with respect to the two trials. The Court considered the implications of Rule 9-1 on the outcome. The court decided that, given the first jury award it was reasonable for the plaintiff to reject the formal offer extended prior to the second trail. Costs of the two trials were awarded to the Plaintiff. In that regard, Justice Humphries said the following:

 

[60] The awards in civil jury trials are unfortunately (although understandably, given that they receive no instructions on ranges of damages) very difficult to predict or explain. They sometimes even seem random and arbitrary. However the vagaries of the civil jury system should not be a basis for compelling a plaintiff to accept an offer simply because juries are so unpredictable.

 

 

[62] This court has stated many times that parties should be encouraged to settle, and if unreasonable in not doing so, may be punished in costs. As well, the fact that an award of costs against a party may wipe out their award of damages is not determinative. However, given all the circumstances that existed at the time the offer was made which did not change throughout the trial, I am not persuaded that the plaintiff ought to be denied her costs on the basis that she ought reasonably to have accepted the offer that was made twelve days before the trial began. Having in mind the amount of the first award, the narrow issue upon which a new trial was ordered, the amount of the second offer, and the expected similarity of the evidence at the second trial, the plaintiff was reasonable in deciding not to accept the offer and to have the action adjudicated by a second jury.

 

[63] In all of the circumstances, including the factors in Rule 9-1(6) and the submissions of the parties, the plaintiff should have her costs of the second trial.

 

Insurance Relevant to Consideration of Financial Circumstances of Parties:

 

In her decision, Justice Humphries rejected the argument of ICBC’s lawyer that, in respect of the matter of awarding costs, the defendant should be treated as an individual and not as a party defendant by ICBC. Following the lead of the Court of Appeal in Smith v. Tedford, 2010, BCCA 302, Justice Humphries confirmed that insurance coverage is a factor that can be taken into consideration:

 

[53] …While insurance coverage is not automatically a factor to be considered against the insured party, the facts of the particular case will govern whether it should be considered, and if so, what weight should be given to it.

 

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