4.29: Costs consequences of formal offer to settle

Case Summary

The Applicant, Mr. Parker, was awarded Costs in a prior spousal and child support Decision and subsequently applied for the Costs to be doubled under Rule 4.29, as the Respondent, Ms. Yassa had not responded to a Formal Offer, and it had expired.

Topolniski J. remarked that a Formal Offer to settle is “an important and powerful litigation tool”, and Courts should not lightly deviate from the Costs consequences that flow from it. A Formal Offer must be reasonable and realistic. Further, it must be assessed in light of the surrounding circumstances that existed when the Formal Offer was served and remained open, and the outcome of the Trial or Appeal.

In this case, Topolniski J. found that the Formal Offer was reasonable and realistic, meeting the threshold of a genuine offer. Justice Topolniski examined the outcome of the case for the Applicant and compared it to the Formal Offer, having regard to the particular words of the Formal Offer. Topolniski J. held that the Respondent did not beat the Formal Offer, and there were no special circumstances that would counter an award of double Costs.

Topolniski J. noted that pursuant to Rule 4.29(4)(e), the onus is on the Respondent to explain if there are special circumstances which would avoid the awarding of double Costs. However, the Respondent did not provide an explanation in this case. Accordingly, Topolniski J. found that the Applicant was entitled to double Costs plus disbursements.

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