Canada Gazette

Français		Contact us		Help		Search		Canada Site

Home		About us		History		FAQ		Site Map

Notice

Vol. 139, No. 21 — May 21, 2005

Rules Amending the Federal Courts Rules

Statutory authority

Federal Courts Act

Sponsoring agencies

Federal Court of Appeal and Federal Court

REGULATORY IMPACT
ANALYSIS STATEMENT

(This statement is not part of the Rules.)

Background

The purpose of the Rules Amending the Federal Courts Rules ("Rules") is to amend Rules 419 et seq. regarding offers to settle. Amendments have also been proposed with respect to the wording of Rule 455 to update this rule with the Quebec civil law reform in 1994.

Subject to the approval of the Governor in Council, the Federal Court of Appeal and Federal Court Rules Committee can make, amend or cancel any rule.

Rules 419 et seq. of the Federal Courts Rules

The provisions of the Rules addressing offers to settle are designed to encourage parties to settle their dispute early in the litigation process. An early settlement has the added advantage of reducing the costs borne by the parties and conserving judicial resources.

Parties are entitled to make and accept offers of settlement at any time before there is a judgment and any written offer to settle will be considered by the Court in assessing costs under Rule 400(3). In addition to this general rule, there is a need to encourage parties to reach an early settlement, ideally before the beginning of the trial or hearing. This is the specific objective of Rules 419 to 421.

The Rules Committee is proposing amendments to the Rules so that this objective can be achieved. In its opinion, the best means of achieving the objective of sections 419 to 421 of the Rules are as follows:

I.	the current requirement that the offer be kept open for acceptance until judgment is rendered be eliminated to allow the offeror to revoke it at the commencement of the trial or hearing;
II.	in order for the costs sanctions to be applied, the offer be made within a minimum of 14 days preceding the beginning of the trial or hearing. This measure will ensure that a party to whom an offer is made has enough time to consider it; and
III.	a new provision, section 420.1, be enacted to enable a party to make an offer that deals with capital only, leaving the issue of costs, disbursements and interest unresolved. Once the offer has been accepted, one of the parties could apply to the Court for an order concerning costs, disbursements and interest.

Rule 455

Following the Quebec civil law reform in 1994, amendments to Rule 455 are proposed to bring the wording of this rule up to date. The French version still refers to old civil law concepts, i.e. "charge" ["charge"] and "privilège" ["lien"].

Technical description

In order to achieve the objectives described above regarding Rules 419 et seq., there are proposed amendments to Rule 420. A new Rule 420.1 is also proposed.

In order to bring Rule 455 up to date, the terms "charge" and "lien" are replaced by the expression "claims to have an interest in the debt."

Benefits and costs

There are no costs associated with these amendments.

Consultation

On March 11, 2004, a discussion paper explaining the amendments contemplated by the Federal Court of Appeal and Federal Court Rules Committee regarding offers to settle was distributed to the legal community, including hundreds of lawyers across Canada, as well as provincial and federal organizations such as bar associations. Further, the discussion paper has been posted on the Web sites of the Federal Court of Appeal and of the Federal Court since that date.

In developing the proposed amendments, the Rules Committee considered comments received during the consultation period.

Contact

For more information, please contact Éloïse Arbour, Secretary of the Rules Committee of the Federal Court of Appeal and the Federal Court, Federal Court of Appeal, Ottawa, Ontario K1A 0H9, (613) 995-5063 (telephone), (613) 941-9454 (facsimile), eloise.arbour@fca-caf.gc.ca (electronic mail).

PROPOSED REGULATORY TEXT

Notice is hereby given, pursuant to paragraph 46(4)(a) (see footnote a) of the Federal Courts Act (see footnote b), that the rules committee of the Federal Court of Appeal and the Federal Court, pursuant to section 46 (see footnote c) of that Act, proposes to make the annexed Rules Amending the Federal Courts Rules.

Interested persons may make representations with respect to the proposed Rules within 60 days after the date of publication of this notice. All such representations must cite the Canada Gazette, Part I, and the date of publication of this notice, and be addressed to Éloïse Arbour, Secretary to the Rules Committee, Federal Court of Appeal, Ottawa, Ontario K1A 0H9.

Ottawa, May 4, 2005

RAYMOND GUENETTE
Acting Chief Administrator
Courts Administration Services

	RULES AMENDING THE FEDERAL COURTS RULES
	AMENDMENTS
	1. Rule 420 of the *Federal Courts Rules(see footnote 1) is replaced by the following:*
Consequences of failure to accept plaintiff's offer	420. (1) Unless otherwise ordered by the Court and subject to subsection (3), where a plaintiff makes a written offer to settle and obtains a judgment as favourable or more favourable than the terms of the offer to settle, the plaintiff is entitled to party-and-party costs to the date of service of the offer and costs calculated at double that rate, but not double disbursements, after that date.
Consequences of failure to accept defendant's offer	(2) Unless otherwise ordered by the Court and subject to subsection (3), where a defendant makes a written offer to settle, (a) if the plaintiff obtains a judgment less favourable than the terms of the offer to settle, the plaintiff is entitled to party-and-party costs to the date of service of the offer and the defendant shall be entitled to costs calculated at double that rate, but not double disbursements, from that date to the date of judgment; or (b) if the plaintiff fails to obtain judgment, the defendant is entitled to party-and-party costs to the date of the service of the offer and to costs calculated at double that rate, but not double disbursements, from that date to the date of judgment.
Conditions	(3) Subsections (1) and (2) do not apply unless the offer to settle (a) is made at least 14 days before the commencement of the hearing or trial; and (b) is not withdrawn and does not expire before the commencement of the hearing or trial.
Offers without costs	420.1 (1) In circumstances where a written offer to settle does not provide for the settlement of the issue of costs, if a party requests the Court to consider rule 420, the Court, in ascertaining whether the judgment granted is more or less favourable than the offer to settle, shall not have regard to costs awarded in the judgment or that would otherwise be awarded.
Application to court	(2) For greater certainty, if a written offer to settle that does not provide for the settlement of the issue of costs is accepted, a party to the offer may apply to the Court for an order determining costs.
	2. Subsection 455(1) of the Rules is replaced by the following:
Order for other person to attend	455. (1) If, on a motion under rule 449, it is brought to the notice of the Court that a person other than the judgment debtor has or claims to have an interest in the debt sought to be attached, the Court may order the person to attend before the Court and state the nature of his or her interest.
	COMING INTO FORCE
	3. These Rules come into force on the day on which they are registered.

[21-1-o]

Footnote a

S.C. 1990, c. 8, s. 14(4)

Footnote b

S.C. 2002, c. 8, s. 14

Footnote c

S.C. 2002, c. 8, s. 44

Footnote 1

SOR/98-106; SOR/2004-283

NOTICE:
The format of the electronic version of this issue of the Canada Gazette was modified in order to be compatible with hypertext language (HTML). Its content is very similar except for the footnotes, the symbols and the tables.


	Top of page

Maintained by the Canada Gazette Directorate	Important notices

Updated: 2006-11-23