If costs are always awarded to the party who offers settlement, then how'd the offering party've failed to specify costs?

Question

_{Source: Ontario Small Claims Court - A Practical Guide (2011). p. 221 Bottom.}

§11.16 Of course, the Rules Committee had various options open to it in the event the offer to settle failed to speak to costs. [1.] One option would be to let the parties bear their own costs. If the defendant were self-represented, he would probably take for granted that each side would assume his own costs. This would not be an unreasonable assumption.

§11.17 [2.] A second option would be always to give costs to the party accepting the offer, whether he be plaintiff or defendant. I think that that accepting party would be rather surprised but nevertheless grateful if that were the normal rule.` [3.] A third option would be to give costs to the offering party in all cases, regardless of whether he were plaintiff or defendant. But that entitle-

p. 222 Top

ment to costs would be rather unfair to the unsuspecting accepting party, who would argue that a failure on the part of the offering party to specify costs is his fault. The offering party should not be able to capitalize on his own mistake.

I don't understand the gray. 1. How'd such an offering party fail to specify costs?

2. How's this failure (on the part of the offering party to specify costs) be his fault? What's his mistake?

Answer 1

If the option were taken to award costs to the offering party, then a defendant could say "I'll give you a a hundred dollars to settle this"; should the unsuspecting plaintiff accept, he would find himself liable to pay both sides' costs and severely out of pocket.

The Committee could not, of course, countenance the idea that a party who was (by definition) legally represented would deliberately lay a trap, so the failure to specify in the offer who should pay the legal costs can only be a mistake (whether by the defendant or his lawyers). It would obviously be wrong to penalize the plaintiff who had made a "not unreasonable assumption", and to reward the failure by the defendant to make clear the consequences of his offer.