BC Civil Resolution Tribunal Restates the Ingredients of a Binding Settlement Agreement

Background

In the underlying dispute, Ehsan Haji Mahdizadeh Zargar alleged that the City of Vancouver infringed his copyright in 2 photographs by using the photographs in its marketing materials without his permission.

Before the Civil Resolution Tribunal (“CRT”), the City took the position that the parties reached a binding settlement during the facilitation phase of the CRT dispute process. Mr. Zargar denied that the parties reached a settlement and opposed disclosure of the parties’ communications. The CRT considered whether the parties reached a binding settlement.

The parties reached a binding settlement

The CRT held that the well-established exception to settlement privilege articulated in Carbide Canada Inc. v. Bombardier Inc., 2014 SCC 35, applied in the circumstances: communications that would otherwise be protected by settlement privilege will cease to be privileged if disclosing them is necessary to prove the existence or scope of a settlement. 

The party asserting that a settlement has been reached bears the burden of proving the settlement on a balance of probabilities. To establish a binding settlement agreement, there must be evidence that the parties agreed to the essential terms of a settlement. There is no need for a formal signed agreement, just evidence of an offer and acceptance of that offer.

Based on its review of the settlement communications that took place during the facilitation phase, the CRT concluded that the parties reached a binding settlement. Following the CRT-facilitated teleconference, the case manager sent a draft Consent Resolution Order (“CRO”) to the parties, confirming that they had reached a settlement and setting out proposed terms. The draft CRO represented Mr. Zargar’s preliminary offer to the City. While the City’s proposed 60-day payment period was a counter-offer, Mr. Zargar’s response that he was content to have a cheque mailed to him or made available for pick up, without any additional time beyond 30 days to pay the settlement, represented a further counter-offer. The City accepted Mr. Zargar’s further counter-offer by agreeing to the 30-day payment period. This informal email exchange was sufficient to create a binding settlement agreement.

The CRT made an order according to the terms of the parties’ settlement agreement.

A copy of the decision is available here.