James M. Regan

The Court of Appeal for Ontario dismissed an appeal by defendants seeking to hold litigation lenders liable for costs incurred by a class member (Mr. Zuber) who pursued an exaggerated damages claim and incurred substantial debt from litigation loans.

The trial judge had refused to order the lenders to pay costs, finding they did not instigate or control the litigation in a manner amounting to an abuse of process, despite the onerous interest rates and the loans impeding settlement.

The Court of Appeal affirmed this decision, reiterating that non-party costs are limited to "person of straw" or abuse of process scenarios, neither of which applied to the lenders' conduct.

The court also refused leave to cross-appeal the trial judge's decision not to award costs of the motion to the lenders, finding no error in principle.

Following a failed motion by the defendants to have their trial costs paid by various litigation loan providers, the loan providers sought their costs of the motion.

The court declined to award costs to the loan providers, finding that the defendants' motion raised a novel issue regarding the enforcement of a costs award against a litigation loan provider and the requirement for court approval of litigation loan agreements.

Given the novelty of the issue, the court exercised its discretion to make no order as to costs.

Following a lengthy trial where the plaintiff was awarded $50,000 but the defendants obtained a costs award of over $3.4 million, the defendants moved to recover those costs from four non-party litigation loan providers who had advanced funds to the plaintiff.

The court declined to order costs against the non-parties, finding that while the loans carried exorbitant interest rates, providing them did not amount to an abuse of process under the 'person of straw' test or the court's inherent jurisdiction.

The court also noted that while litigation loans should be approved by the court in class proceedings, the statutory requirement to do so did not exist at the time the loans were made.

The court determined costs following a 106-day individual assessment trial in a class action where the plaintiff recovered $50,000 after claiming $60,000,000.

The plaintiff sought over $7,000,000 in costs, including nearly $3,000,000 in interest on litigation loans.

The court ruled that interest on litigation loans is not a recoverable disbursement.

Finding that the plaintiff unreasonably rejected multiple offers to settle from the defendants, the court awarded the plaintiff partial indemnity costs up to the date of the defendants' first offer in 2009, and awarded the defendants their partial indemnity costs thereafter, resulting in a net costs award of over $2.3 million payable by the plaintiff to the defendants.

The plaintiff, a class member in a class action arising from a 1999 VIA Rail train derailment, sought over $60 million in damages, primarily for past and future loss of income and future care costs.

The plaintiff claimed the accident caused severe, debilitating injuries that destroyed his highly lucrative consulting business in Poland and Eastern Europe.

The court found the plaintiff and many of his lay and medical witnesses lacked credibility, noting significant inconsistencies, lack of documentary evidence (such as tax returns and banking records), and evidence of extensive post-accident travel and business activities.

The court rejected the income loss and future care claims entirely, awarding only $50,000 in general damages for minor soft tissue injuries.

During a trial for damages arising from a railway accident, the plaintiff (a class member) sought to qualify an expert witness to provide opinion evidence on the profitability of a proposed European pipeline project, claiming a loss of opportunity.

The defendants objected to the expert's admissibility.

Following a voir dire, the court refused to qualify the expert.

The court found the expert's evidence lacked reliability due to an undisclosed prior business relationship with the plaintiff.

Furthermore, the court held the expert evidence was unnecessary because the plaintiff failed to produce admissible evidence or documentation demonstrating he could have obtained the financing required to build the pipeline.

During a lengthy personal injury trial arising from a train derailment, the defendants brought a motion to determine whether the plaintiff required leave under section 12 of the Evidence Act to call more than three 'participant experts' (treating doctors) who intended to proffer opinion evidence.

The court held that while treating doctors testifying strictly to history, treatment, diagnosis, and prognosis do not require leave, those offering broader opinion evidence must comply with Rule 53.03 and are subject to the three-expert limit.

The court emphasized its gatekeeper function and the need for proportionality, ruling that the plaintiff must seek leave to call more than one expert per medical specialty.

During a personal injury trial arising from a train derailment, the defendants brought mid‑trial motions seeking orders requiring certain foreign witnesses to testify in person in Canada rather than by video conference and restricting the plaintiff to evidence previously disclosed under an earlier discovery order.

The court considered Rule 1.08 of the Rules of Civil Procedure and the broader access‑to‑justice principles articulated in Hryniak v. Mauldin.

The judge held that credibility concerns alone did not justify refusing video evidence and found the balance of convenience favoured permitting the witnesses, located abroad, to testify by video conference with interpretation.

The court also declined to limit the plaintiff’s evidence to earlier will‑say statements, finding that continuing disclosure obligations and fairness required allowing updated affidavit evidence while preserving the defendants’ opportunity to challenge it.

The plaintiff sought approximately $2.6 million in damages against a contractor and an acrylic sheet manufacturer arising from alleged defects in the design, manufacture, and installation of a skylight system for a horse riding arena.

The plaintiff alleged negligent design, negligent manufacture of acrylic sheets, negligent misrepresentation in product literature, and spoliation of evidence.

After a lengthy trial, the court found no negligence or breach of contract by the contractor and no negligence in the manufacture of the acrylic sheets by the manufacturer.

Although the manufacturer should have disclosed certain test results regarding light transmittance, the plaintiff failed to prove causation.

The court further held the plaintiff fundamentally breached the contract and was contributorily negligent by refusing to install an automatic controller and by failing to implement recommended ventilation and heating measures, and also failed to mitigate its losses.

At the commencement of a lengthy construction dispute trial, the defendants sought to set aside an earlier bifurcation order so that liability and damages could be tried together, while the plaintiff moved to strike the defendants’ jury notice.

The court exercised its inherent jurisdiction to manage the trial process and set aside the earlier order, finding that trying all issues together would avoid multiplicity of proceedings and that evidentiary overlap justified a single trial.

The court also held that the case involved exceptionally complex factual, technical, and legal issues, including numerous expert reports, extensive documentary evidence, multiple causes of action, crossclaims, and potential apportionment under a Pierringer agreement.

Given these complexities, the court concluded that justice would be better served by a judge-alone trial rather than a jury.

The jury notice was therefore struck and the matter ordered to proceed on all issues before a judge.