J. 1989 S.H. No. 67294 IN THE SUPREME COURT OF NOVA SCOTIA BETWEEN: CAULETTE BARBARA BEZANSON, by her Guardian Ad Litem, HAROLD BEZANSON PLAINTIFF (DEFENDANT BY COUNTERCLAIM) and DAVID W. BOUTILIER DEFENDANT (PLAINTIFF BY COUNTERCLAIM) SUPPLEMENTAL DECISION HEARD BEFORE: The Honourable Justice A. David MacAdam, by written submissions DECISION: Written Decision Released May 9, 1994 COUNSEL: Raymond F. Wagner, Counsel for the Plaintiff David Miller, Counsel for the Defendant MACADAM, J. MACADAM, J. Caulette Barbara Bezanson, the plaintiff, by decision dated November 5, 1993, was found two‑thirds and the defendant, David W. Boutilier, was found one‑third responsible for the injuries suffered by Ms. Bezanson in an accident that occurred on the No. Highway on October 21, 1987. Mr. Boutilier's vehicle struck Ms. Bezanson while she was attempting to cross the No. Highway on her bicycle. The decision of this court, in addition to apportioning responsibility for the accident, fixed her general damages at $50,000, including non‑pecuniary loss for pain and suffering and loss of amenities of life at $25,000 and loss of past and future income including loss of future occupational and career opportunities, or diminution of earning capacity, also in the sum of $25,000. Damage to the defendant's vehicle was determined at $1,255.25. In concluding the decision, this court stated: "Subject to hearing from counsel, the plaintiff shall have her costs in this action, on party and party basis, on Tariff 'A', Scale (basic) and fix the amount involved at $50,000.00." Counsel have advised that they have been unable to agree on a number of matters related to interest and costs and counsel for the defendant lists as outstanding issues: 1. The apportionment of costs and the effect of settlement offers made by the parties; 2. The pre judgment interest rate; 3. Limitation on the period during which pre judgment interest will run. 1. APPORTIONMENT OF COSTS AND EFFECT OF SETTLEMENT OFFERS The practice of apportioning costs in motor vehicle negligent cases, consistent with findings of fault, has been followed in this court, at least, where the findings of fault relate to the happening of the event causing the accident rather than to any aggravation of the injuries or failure to mitigate their effect. The apportionment of costs in case involving contributory negligence was considered by the late Chief Justice Cowan in Tzagarakis v. Stevens (1968), N.S.R. (1965‑69) 453. At pp. 461‑462 he held: "I have made enquiries as to the practice recently followed by trial judges in this Division with regard to costs, where there is division of fault and there is no counterclaim and in cases where there is counterclaim. find that the practice since Brewster v. Spicer, supra, has been to award the plaintiff who is found partly at fault portion of his costs, such portion to be the same percentage recovery as is found with respect to damages, and to allow the defendant portion of his costs, such portion being the same percentage as is found to be applicable to fault on the part of the plaintiff. This practice has, apparently, been sanctioned by the Appeal Division in the case of Langille v. Zwicker (1967), 1967 CanLII 625 (NS CA), 66 D.L.R. (2d) 196; N.S.R. 1965‑69 448, where, in an action by pedestrian against the operator of motor vehicle, the jury found that the operator was not at fault and judgment was entered for the defendant with costs. The Appeal Division allowed the appeal and apportioned fault 50/50 between the parties and Currie, C.J.N.S., said at p. 199: The costs should be based on 50% to each party, both as to the trial and the appeal. This rule appears to apply whether there is counterclaim or not." Cooper, J.A. in White v. Carter (1974), 1973 CanLII 1235 (NS CA), N.S.R. (2d) 60, on behalf of the Nova Scotia Supreme Court, Appeal Division, stated at p. 64 that he agreed with the practice of apportioning costs based on findings of fault, as stated by Chief Justice Cowan in Tzagarakis, supra. In MacPherson v. Campbell and MacIver (1980), 45 N.S.R. (2d) 401, Glube, J. (as she then was) reviewed number of authorities, including Tzagarakis, and assessed costs in the same proportions as liability and in Whitman v. Moore (1978), 28 N.S.R. (2d) 631, Macintosh, J. similarly awarded costs in the same percentages as the findings of fault. On the other hand, Burchell, J. in Fraser v. Ross and Ross (1983), 64 N.S.R. (2d) 87, although assessing the plaintiff 10 percent contributory negligence because of the failure to wear seat belt, awarded full costs to the plaintiff. At page 89: "The general rule (and the one followed in my written reasons) is that costs follow the event. In the ordinary case of contributory negligence there is logical division of costs that matches the allocation of fault. note, however, that in each of those cases the offsetting negligence was negligence that contributed directly to the accident. The point is not made explicitly in any of the opposing line of cases cited by the plaintiffs, but agree that they reflect distinction made between the ordinary case of negligence contributing to the occurrence of an accident and cases (like those involving seat belts) where the contributory negligence only caused an aggravation of injuries. In the present case it has been shown that the accident was entirely the fault of the deceased defendant, Clarence Ross. The contributory negligence of the several plaintiffs has only served to limit the extent to which their losses due to injuries are compensable. The situation is not unlike the common case in which plaintiff succeeds on an issue of fault but fails to prove part of his claim." Unlike other areas of civil litigation where costs are awarded, as general rule, where party is successful in obtaining an award greater than any offer made prior to litigation, the practice in cases involving contributory negligence appears to be to apportion costs in the same percentage as the findings of fault. The authorities recognize that there may be instances where court may exercise its discretion pursuant to rule 63.02 and award costs other than in the same proportions as the findings of fault. In Dempsey v. Brown (1986), 71 N.S.R. (2d) 416, in case where he apportioned liability 20 percent against the plaintiff and 80 percent against the defendant, Nathanson, J. awarded costs in the same proportions as liability. After referring to number of the authorities, including Tzagarakis v. Stevens and White v. Carter, as to the practice of the Nova Scotia Courts, he referred to the discretion in trial court to apportion costs in different percentage than the findings on liability. He noted, however, that the discretion "must be exercised judicially" and in the majority of such cases the court should provide reasons for the exercise of such discretion. At page 418: "Special circumstances might warrant an exercise of discretion so that the general practice is not followed in particular case. However, no such special circumstances were disclosed here." The accident occurred on October 21, 1987. The Originating Notice (Action) and Statement of Claim were issued on January 27, 1989, the Defence and Counterclaim on February 7, 1989, and the Defence to the Counterclaim on March 21, 1989. The Notice of Trial, initially with jury, and the Record for Trial Judge were filed on July 27, 1992, and the trial was held on February 23, 24 and March 12, 1993. The plaintiff filed an Offer to Settle on January 29, 1993, in the amount of $35,000 and the defendant filed an Offer to Settle on February 9, 1993, in the amount of $2,000 together with withdrawal of his Counterclaim. The plaintiff submits that the award to the plaintiff, with interest for six years at 9.41 percent per annum, and disbursements, less the Counterclaim, approximates the amount of the Offer to Settle. Counsel suggests as result, Civil Procedure Rule 41A.09 is applicable and the plaintiff is entitled to double his costs. In the event the eventual award is below the plaintiff's offer, counsel suggests that we should exercise our discretion to either increase the Tariff applicable or double costs in the circumstances of this case. In support of his submission he quotes from the decision of Justice Grant in Goode v. Oursen, S.H. No. 06130, and in particular at page 5: "I consider rule 41A.11 has the purpose of encouraging parties to make realistic offers to settle by rewarding parties who make realistic offers even though they may be slightly lower or higher than the eventual award, after trial." The discretion in Civil Procedure Rule 41A.11 may well serve to alleviate hardship or unfairness caused by the general practice of awarding costs in contributory negligence case in the same proportion as the findings of fault. Such practice may very well unfairly prejudice plaintiff by excessively reducing its entitlement to costs where the actual final award approximates an earlier offer of settlement by the plaintiff and is substantially in excess of any offer made the defendant. The statement by Justice Grant may very well be applicable in such situation However, we are not persuaded to exercise our discretion, nor that comments of Justice Grant are applicable in the present circumstances. The only Offer to Settle made by the plaintiff was in excess of five years following the accident and was withdrawn less than month later. It does not approximate the eventual recovery by the plaintiff nor, in the words of Grant, J., is it "slightly lower or higher then the eventual award, after trial." The plaintiff will, therefore, have one‑third of its taxed costs on Tariff "A", scale 3 (basic). The defendant was, two‑thirds successful on his Counterclaim. However, the Counterclaim was for only $1,255.25. In the circumstances, am not disposed to award costs to the defendant on the Counterclaim. The defendant in its offer of settlement, in addition to offering sum of $2,000, offered to withdraw the Counterclaim. To award 70 percent of the costs on the Counterclaim would be, in the circumstances, inequitable and unfair to the plaintiff. The court exercises its discretion and declines to award costs on the Counterclaim. The defendant submits, in the alternative, that if costs are only awarded to the plaintiff, the "Amount Involved" should be limited to the amount of the plaintiffs actual recovery, namely the sum of $16,666.67. We do not agree. The reduction in the actual recovery by the plaintiff is the result of the apportionment of fault in respect to the accident, not because of the plaintiff having either aggravated her injuries or failed to mitigate the effects of the accident. To reduce the "Amount Involved" would, in the circumstance, create a double reduction in the costs to which the plaintiff is entitled and would, therefore, not be appropriate. For the purpose of taxation of the plaintiff's costs, the amount involved will be the sum of $50,000 as stated in our decision of November 5, 1993. 2. PRE‑JUDGMENT INTEREST RATE The awards of $25,000 for non‑pecuniary loss for pain and suffering and loss of amenities of life and $25,000 for loss of past and future income, including loss of future occupational and career opportunities or diminution of earning capacity, were made as at the date of trial. In fixing the rate of interest to be awarded to the plaintiff note the statement of Chipman, J.A. in Bush v. Air Canada (1992), 1992 CanLII 2566 (NS CA), 109 N.S.R. (2d) 91, at p. 105: "[60] double recovery should be avoided in the exercise of trial judge's discretion under ss. 41(i) and (k) of the Judicature Act, supra. The conclusion must be that to the extent that inflation was taken into account for the period between the accrual of the cause of action and the trial, the judge should then adjust the interest rate so that it is not taken into account for second time. This exercise should be carried out in fixing the rate and requires an examination of the award to determine whether inflation from the date the cause of action arose has been taken into account. Judges should take particular care in cases where long period of time has elapsed between the time the cause of action arose and the assessment of damages. It is in these cases where one can more often say with confidence that the award has grown by inflation from what it would have been at the time from which interest starts to run. In many cases, judge may not be able to say with any degree of certainty that an inflation factor has been built into the award. In these cases when the second step is taken, commercial rate of interest would generally be appropriate. Where, however, judge is satisfied that inflation has been built in, rate such as the discount rate of 2½% per annum is appropriate. If the trial judge does not do this, double recovery results to the plaintiff. An injustice is therefore done which requires interference by an appeal court with such an exercise of discretion." In the circumstances the appropriate rate of interest to be applied is 2.5 percent per annum. 3. PERIOD FOR PRE‑JUDGMENT INTEREST The Notice of Trial was filed more than five years after the date of the accident. The plaintiff submits the passage of time is accountable by the youth of the plaintiff, the normal time to bring case to trial, court delays and the nature of the injuries that she suffered. Although counsel may be correct that, in the normal course of circumstances, delays of three to four years may be expected from the date of an accident to the date of trial, it does not justify nor explain the delay in filing the Notice of Trial in the present case. We are also not persuaded that the long delay in bringing this matter to conclusion should be countenanced because the medical evidence at trial indicated the earlier medical optimism on her long‑term prognosis had not been borne out over time. The long periods of inactivity in prosecuting this matter are not now to be justified because the prognosis for Ms. Bezanson is less optimistic than it earlier had been. If the delay is to be justified because her recovery is less than the doctors had expected, then counsel could never, without risk of being sued, either effect settlement or proceed to trial, until claimant has either totally recovered or the expert opinions on the degree of continuing disability are such as to leave little, if any, chance of being either too optimistic or unrealistic in their assessment of the degree or permeance of disability. The impact of such position on civil litigation and the resolution of civil disputes is untenable. The plaintiff is, therefore, entitled to interest for period of three and one- half years. J. Halifax, Nova Scotia
The plaintiff was found to be two-thirds and the defendant one-third responsible for an accident which occurred when the defendant's car hit the plaintiff as she tried to cross the highway on her bicycle. The court awarded costs to the plaintiff fixed at the amount involved - the quantum of general damages. The parties were unable to reach an amount of settlement. In this matter, the defendant argued that the costs should be fixed at the amount actually recovered by the plaintiff. Awarding the plaintiff one-third of her taxed costs, that to reduce costs by the percentage of fault of the plaintiff and to reduce the amount involved would be a double reduction.