Estate Planning

The Impact of Offers to Settle and other Factors on Cost Awards

By Hull & Hull LLP

An offer to settle made pursuant to Rule 49 of the Rules of Civil Procedure can be an extremely effective mechanism to secure a better costs order (see Rule 49.10).  Most offers made outside the ambit of the Rules can also be very helpful to the offeror from a costs standpoint, particularly if such offers (like Rule 49.10 offers) demonstrate that it would have been better for the recipient of the offer to have accepted it. 

However, a low ball offer made at the last minute may have little or no beneficial impact whatsoever.  In Volchuk Estate (Re), a contested passing of accounts application, where such an offer was made by the respondent, the court held that the offer did not have any influence on the quantum of costs that should be ordered to be paid. 

Several factors in discretion under Rule 57.01 that are to be considered by a court when making costs decisions will also likely impact on the quantum of a cost award.   In this case, for instance, the respondent was found not only to have failed to properly account for his activities as attorney for the deceased, but also to have misappropriated funds of the deceased during his lifetime.   While the principal amount of the Judgment against him was in the amount of approximately $40,000, the costs Order rendered exceeded $100,000. 

Thanks for reading,

Natalia

Full post as published by Toronto Estate Law Blog on January 16, 2008 (boomark / email).