Executive Summary: Key Legal and Evidentiary Issues

• Sunnyside sought double costs for a two-day fast-track trial because the defendants had rejected its pre-trial offer to settle under Rule 9-1 of the Supreme Court Civil Rules.
   
• Before trial, Sunnyside had offered to accept $7,500 and a dismissal of the action without costs; the judgment it later obtained was $10,153 plus interest.
   
• Reasonableness was assessed based on what the recipient knew while the offer was open, not with hindsight.
   
• Because the case had proceeded as a fast-track action under Rule 15-1, the court replaced its earlier scale B costs award with one calculated under Rule 15-1(15).
   
• According to the defendants, double costs would be unnecessarily punitive, since their claims were bona fide and not vexatious and they faced financial hardship.
   
• Financial hardship arguments were rejected because the defendants offered no evidence, detail, or legal basis linking them to the costs award.
   

Facts of the case

Sunnyside Electrical Maintenance Services Ltd. sued Kim Thao McCurley and Vincent Hoa McCurley, homeowners who had hired it for electrical services. It sought damages and a declaration of a builder's lien for unpaid electrical work after the defendants ended the contract before the work was finished. In their counterclaim, the defendants said Sunnyside breached the contract by demanding full payment before completing the work, and that its failure to complete the work delayed their home renovation, causing additional costs and damages.

Justice Whately gave judgment on March 6, 2026 (2026 BCSC 389). He found that the defendants had clearly and unequivocally terminated the contract before the work was complete, that they created the circumstances leading to Sunnyside's demand for payment, and that any delays or added costs came from their own decisions rather than from Sunnyside. Sunnyside received judgment for $10,153 plus interest, and the counterclaim was dismissed. Costs were awarded to Sunnyside at scale B. Sunnyside then asked for leave to make submissions on costs because of an offer it had made before trial.

Settlement offers had gone both ways. On June 6, 2025, the defendants offered to pay $1 on Sunnyside's claim and demanded $5,000 from Sunnyside to settle their counterclaim. Sunnyside replied on June 20, 2025, offering to accept $7,500 and have the action dismissed without costs. That offer was open until June 25, 2025, and trial was set to begin on July 3, 2025. By then, examinations for discovery were complete, and document disclosure, while still ongoing in the lead-up to trial, was largely complete.

Policy and legislative provisions at issue

Rule 15-1 governs fast-track litigation. Fixed costs, exclusive of disbursements, are set by Rule 15-1(15) according to how long the trial lasts: $8,000 for one day or less, $9,500 for more than one day but no more than two, and $11,000 for more than two days. Under Rule 15-1(16), the rules on the costs consequences of rejecting formal offers to settle may also apply in fast-track actions.

Rule 9-1(4) allows the court to consider an offer to settle when exercising its discretion on costs. Under Rule 9-1(5)(b), the court may award double costs for all or some of the steps taken after the offer was delivered. Rule 9-1(6) lists factors the court may consider: whether the offer ought reasonably to have been accepted, the relationship between the offer and the final judgment, the parties' relative financial circumstances, and any other factor the court considers appropriate.

Reasoning and analysis

Justice Whately noted that the original costs order should have been made under Rule 15-1(15) rather than scale B, since the matter proceeded as a fast-track trial. This decision replaced that order. Sunnyside asked for double costs for the trial only, along with disbursements, calculated under Rule 15-1(15). In practical terms, the dispute was over $3,000. Each trial day is allowed at $1,500, so the two days totalled $3,000, and doubling that would bring trial costs to $6,000 on top of the usual fast-track pre-trial costs.

Sunnyside argued that its offer was plainly better for the defendants than the outcome. By its own calculation, the judgment plus interest, costs, and disbursements came to a possible total of $25,234, roughly $17,700 more than the offer. It also argued that nothing suggested economic disparity played any role, pointing out that both sides had counsel at trial and describing itself as a small business owned and operated by one man. Given the simple claims and the stage of the litigation, Sunnyside added, the short acceptance window still gave the defendants enough time to consider the offer.

The defendants, who represented themselves on the costs application, argued that double costs would be disproportionate and unnecessarily punitive. In their view, their claims were bona fide and not vexatious, the court had to weigh conflicting evidence, and they had taken part in good faith without obstructive conduct. Their financial hardship, they said, included a change in employment circumstances, ongoing mortgage obligations, household expenses including their children's tuition, and the "additional and unanticipated costs" of hiring other contractors to finish Sunnyside's work.

On the governing principles, the court relied on Hartshorne v Hartshorne, 2011 BCCA 29, which explains that Rule 9-1 exists to encourage early settlement by rewarding reasonable offers and penalizing parties who reject them. Under Giles v Westminster Savings Credit Union, 2010 BCCA 282, the discretion must be exercised in a just, principled, and consistent way. Citing Hartshorne and Yip v Saran, 2014 BCSC 1593, the court held that reasonableness depends on the circumstances while the offer was open, not on the eventual award. Wafler v Trinh, 2014 BCCA 95, which quotes Evans v Jensen, 2011 BCCA 279, supported the point that a party rejecting a reasonable offer should usually face some costs sanction, so that the rule keeps its certainty and consequences.

Applying these principles, the judge noted that both offers were made after discovery, with trial imminent, and that both parties had counsel and knew the case they had to meet. In that context, $7,500 plus a discontinuance without costs was a reasonably significant compromise, considering the amounts at stake, the timing, and the benefit of avoiding trial and its costs and risks. The judge answered the punitive argument by pointing to the purpose of Rule 9-1 and found that the proposed increase in trial costs was not disproportionately punitive.

The hardship arguments did not succeed. No evidence or detail was offered to show how ordinary household costs or financial pressures should affect the costs award, and the defendants cited no legal basis for the argument. Justice Whately also held that denying Sunnyside costs because the defendants had paid to complete the electrical work would be unreasonable and contrary to the costs rules. He had already found that the work was left unfinished because of the defendants' own actions.

Ruling and overall outcome

Sunnyside succeeded on the application. The court awarded double costs for the two trial days and ordinary pre-trial costs under Rule 15-1(15), accepting Sunnyside's calculation under the fast-track formula plus tax. Under the order, Sunnyside receives $14,000 inclusive of taxes, plus $4,441.83 in disbursements, plus the costs of the application. The decision does not quantify the costs of the application or state a combined total.