BCCA approves claim settlement of less than 10% of full value.

On November 29 2018, BC Court of Appeal approved the settlement of a claim, potentially worth more than $400,000.00, for the all inclusive sum of 35,000.00.

In Deo v. Vancouver, 2018 BCCA 464, a child suffered serious injuries at school, leaving him partially blind. He sued for damages and was largely unsuccessful on proving liability at trial. The child’s lawyer valued the claim at over $400,000, but before the liability appeals could be heard a settlement of $35,000 was reached. The child, being a minor, could not legally agree to any settlement and judicial approval was required.

The BC Court of Appeal noted that if the lawsuit ultimately proved unsuccessful the costs consequences would be so steep that the child’s parents may need to sell their house to pay the defence costs. Appreciating that this risk-based settlement was reasonable  the Court approved it for the following reasons:

[11] Counsel assesses the quantum of damages for non-pecuniary loss in the range of $100,000 to $140,000 and for loss of future earnings in the range of $300,000 to $350,000. The estimate of an adverse costs award if the appeal is unsuccessful is in excess of $100,000.

[12] Isaac lives with his parents in a house in East Vancouver. If costs are awarded against him, they would have to sell the house to pay the costs. His father says that he has weighed the prospects of success of the appeal against the risk of losing the home and the impact that would have on Isaac and the rest of the family. He says he has concluded that it is in Isaac’s best interests to accept the settlement.

[13] The parties have consented to the trial judge approving the solicitor’s account without costs.

[14] Having read the materials provided, it is our view that the settlement is a prudent one, and is in Isaac’s best interests. As was noted in Lotocky, “it is… artificial and misguided to judge the merits of the appeal in isolation from the financial ramifications that would arise from an unsuccessful appeal”: para. 69. Counsel for Isaac acknowledges the “very real” risk that the appeal on liability will be unsuccessful. In light of the serious financial consequences that would flow from an unsuccessful appeal, we agree with the assessment of counsel and that it is in Isaac’s best interests to accept the settlement.

[15] The settlement is approved in the terms sought. The appeal and cross appeal are dismissed as abandoned on a without costs basis to any party. The matter is remitted to the Supreme Court to Justice Riley for approval of the solicitor’s account.