4.29: Costs consequences of formal offer to settle
10.41: Assessment officer’s decision

Case Summary

The Parties sought directions on Costs following Trial in a wrongful dismissal Action. The Plaintiff received Judgment of $72,000 for unpaid bonuses. The remainder of the Plaintiff’s claims were dismissed. Justice Mah noted that the Plaintiff’s actual salary paid during the notice period, together with a with-prejudice payment made by the Defendant and the Plaintiff’s mitigation income exceeded the payment due in lieu of notice. The Defendant sought to set off the amounts received by the Plaintiff which exceeded the amount payable for the notice period (the “excess amount”).

The Defendant, prior to Trial, had issued several Formal Offers, none of which were beaten by the Plaintiff at Trial. The Parties agreed that the Plaintiff was entitled to his Costs up to the date of the first Formal Offer, and the Defendant was entitled to Costs from the date of the first Formal Offer through to Trial. However, the Defendant asserted it was entitled to double Costs from the date of the second Formal Offer it made because the second Offer was accompanied by the with-prejudice payment which made up the bulk of the excess amount. Justice Mah considered the Defendant’s argument that the set-off effectively dismissed the Plaintiff’s Action for the purpose of Rule 4.29(3)(b), but held that the Plaintiff had achieved a Judgment, but had only been prevented from collecting due to set-off. The Action was not dismissed. Accordingly, Justice Mah held that the Defendant was not entitled to double Costs because Rule 4.29(3)(b) was not satisfied.

The Plaintiff disputed the amount claimed by the Defendant for its expert witness, arguing the amounts were exorbitant and not sufficiently particularized. Justice Mah agreed with the Plaintiff that the expert’s invoice did not provide enough information in order to determine whether any of the amounts were excluded under Rule 10.41(2)(e). Justice Mah set the recoverable amount at $40,000.

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