How do Costs Work in a Personal Injury Lawsuit Involving Multiple Defendants?

Like most Canadian provinces, Ontario follows a “loser-pays” rule in civil litigation. This means that as a general rule, the prevailing party in a lawsuit can seek reimbursement of a portion of the costs associated with the litigation from the losing party. Ultimately, if the parties fail to agree on costs, a judge makes the final determination.

But what happens in cases in which a single plaintiff sues multiple defendants, and only some of the defendants are found liable for the plaintiff’s injuries?

For example, say you are injured in a three-car accident. You sue two drivers for damages, but the jury decides only one of them was responsible. Can the innocent driver seek costs against you?

The short answer is “yes.” But you can also ask the court for what is known as a Sanderson or Bullock order. The basic idea behind these orders is that the losing defendant pays some or all of the winning defendant’s costs.

The reason for two different types of orders is somewhat technical: a Sanderson order directs the unsuccessful defendant to pay the successful defendant directly, while a Bullock order reimburses the plaintiff for paying the successful defendant’s costs.

Bukshtynov v. McMaster University

A judge is not required to issue a Sanderson or Bullock order. Depending on the nature of the case, and the plaintiff’s conduct during the litigation, the judge may determine it is appropriate to hold the plaintiff solely responsible for the successful defendant’s costs.

For example, an Ontario Superior Court justice recently denied a Sanderson order requested by the plaintiffs in a personal injury case arising from an unusual pedestrian accident.

The lead plaintiff was a doctoral student at McMaster University. One morning in December 2011, the plaintiff was running on the university’s indoor track. Other people were also using the track, including several track club runners. One of the runners, who was “proceeding at a high rate of speed” according to court records, collided with the plaintiff.

The accident resulted in a serious shoulder injury for the plaintiff, which required surgery. Even with treatment, however, the plaintiff suffers from ongoing pain in his shoulder and a “reduced range of motion.”

He subsequently sued a number of parties for damages, including McMaster University, the track club runner, the track club itself, and the track club’s coach. The plaintiff’s spouse and minor daughter also claimed damages under the Ontario Family Law Act.

The parties attempted to settle before trial. The plaintiffs asked for approximately $1.2 million in damages plus costs. The defendants collectively offered a significantly lower amount, about $180,000. The plaintiffs decided to take their chances at trial.

After a 13-day trial, the jury determined as follows:

• The running club and its coach were 60% liable for the accident;
• The plaintiff was 40% “contributorily negligent” for the accident; and
• The university and the runner were not liable at all.

The jury further awarded just under $102,000 in damages, which was less than the defence offered in settlement talks.

The successful defendants–the university and the runner–were entitled to recover costs. The plaintiff asked the judge for a Sanderson order directing the running club and the coach to pay the costs. The judge said that was “not fair and reasonable” and denied the plaintiff’s request.

The judge cited a number of factors supporting his decision:

• The defendants never tried to blame one another for the plaintiff’s accident; rather, they presented a “unified” front.
• The unsuccessful defendants did nothing that “caused the successful defendant to be added as a party.”
• These were not separate causes of action. Indeed, the “two actions were intertwined,” as the plaintiff alleged the negligence of all of the parties contributed to a single event, i.e. his accident.
• The plaintiff has the ability to pay the successful defendant’s costs.

This last point raised another issue. Many personal injury plaintiffs choose to purchase after-the-event (ATE) insurance to guarantee costs in the event of a loss. In fact, when the university brought a pre-trial motion for security of costs–due to the fact the plaintiff was living in the United States by then–the plaintiff agreed to purchase ATE insurance.

He apparently failed to pay the premium, however, which led the judge to issue a separate order directing the plaintiff to pay approximately $86,000 to the court directly as security.

Having denied the request for the Sanderson order, the judge proceeded to determine costs. With respect to the runner, the judge directed the plaintiff to pay $69,156 in costs. The university received an additional $95,000 in costs. This will be offset by the $86,000 previously paid to the court as security. Separately, the unsuccessful defendants must pay the plaintiff $43,000 in costs.

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The judge did not go easy on the plaintiff when it came to costs. In part, this was because the judge said the plaintiff was “stubborn” in his refusal to settle and his insistence on going to trial, which resulted in a “Pyrrhic victory” before the jury.

The judge was further displeased by the plaintiff’s “bizarre and nonsensical” decision not to pay for ATE insurance. As the court noted, for a single $1,500 premium the plaintiff “would have had some piece of mind” and avoided paying more than $80,000 of his own money as security.

If you were involved in an accident and require legal assistance, schedule a free initial consultation with Preszler Injury Lawyers by calling 1-800-JUSTICE.