The rejection of a settlement offer that exceeds the market value of the subject matter of the claim, at a time when the plaintiff should have appreciated the weakness of the claim, is unreasonable and warrants indemnity costs from the date of the offer. However, a claim that is not doomed to failure does not attract indemnity costs merely because the plaintiff ultimately discontinues or loses. The court declined to adopt a rigid rule for indemnity costs where a plaintiff recovers nothing after rejecting a settlement offer, preferring a discretionary approach.
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