Sabijan v. Sabijan, 2021 ONSC 7605

CITATION: Sabijan v. Sabijan, 2021 ONSC 7605

DIVISIONAL COURT FILE NO.: 515/21 DATE: 2021/11/12

ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT

Perell, Kristjanson and Favreau JJ.

BETWEEN:

Devorra Sabijan

Heather R. Caron, counsel for the Respondent

Respondent (Applicant)

– and –

Kreso Sabijan

Appellant (Respondent)

Self-Represented

HEARD at Toronto by videoconference: November 12, 2021

Kristjanson, J. (Orally)

Background

1This is an appeal from an order for security for costs made by Justice D.J. Gordon on May 18, 2021. The order provided that Mr. Sabijan was to post security for costs in the amount of $30,000.00 within 30 days, pursuant to subrules 24(13)-(15) of the Family Law Rules, O. Reg. 114/99. The order provided that if Mr. Sabijan failed to do so, his pleadings would be struck and outstanding issues in the family litigation would proceed on an uncontested basis. Mr. Sabijan did not post security for costs. By order dated June 29, 2021 the motion judge struck Mr. Sabijan’s pleadings and directed that the trial proceed on an uncontested basis.

2There is no doubt that at various points during the litigation, Mr. Sabijan failed to pay costs as ordered. But in October 2019, Breithaupt Smith J. ordered that the total costs then outstanding —$13,250—be released from Mr. Sabijan’s share of the proceeds of the sale of the matrimonial home.

3On May 12, 2021, Piccoli J. ordered Mr. Sabijan to pay $500 in costs to Ms. Sabijan. It was not an outstanding costs award at the time the matter came before the motion judge six days later. Indeed, Mr. Sabijan did pay the amount ordered within 30 days.

4On the endorsement granting leave to appeal, the Court stated that the motion for leave had “sufficient merit given the issue of whether the grounds for the security for costs order were met and given the important consequences of the order”: Sabijan v. Sabijan, 2021 ONSC 5872.

5The reasons given by the motions judge were that “[o]n the evidence presented, I am satisfied the [respondent] has been deliberately delaying this case, has not complied with prior costs orders and has not paid costs awards. In the circumstances, security for costs is appropriate.”

Analysis

6It was an error in principle for the motion judge to make the security for costs order. The Family Law Rules specifically set out the circumstances in which a judge may order security for costs. Subrule 24(13) provides:

24 (13) A judge may, on motion, make an order for security for costs that is just, based on one or more of the following factors:

1. A party habitually resides outside Ontario.

2. A party has an order against the other party for costs that remains unpaid, in the same case or another case.

3. A party is a corporation and there is good reason to believe it does not have enough assets in Ontario to pay costs.

4. There is good reason to believe that the case is a waste of time or a nuisance and that the party does not have enough assets in Ontario to pay costs.

5. A statute entitles the party to security for costs.

7Subrules 24(14)–24(17) of the Family Law Rules set out the amount and form of the security, the effect of the order for security, the consequences of failing to give security once ordered and the process for changing the order.

8Pazaratz, J. in Izyuk v Bilousov, 2015 ONSC 3684 at para 40, set out the framework for making a security for costs order as follows:

a. The initial onus is on the party seeking security for costs to show that the other party falls within one of the enumerated grounds.

b. If the onus is met, the court has discretion to grant or refuse an order for security.

c. If the court orders security, it has wide discretion as to the quantum and means of payment of the order. Clark v. Clark, 2014 ONCA 175 (Ont. C.A.)

d. The order must be "just" and be based on one or more of the factors listed in subrule 24(13). Hodgins v. Buddhu, [2013] O.J. No. 1261 (Ont. C.J.).

9In this case, the only relevant factor identified by the motion judge was that Mr. Sabijan “has not complied with prior costs orders and has not paid costs awards.” However, subrule 24(13)2 speaks in the present tense—the party must have a costs order “that remains unpaid.” The applicant (respondent on appeal) concedes there was no unpaid costs order within the meaning of subrule 24(13)2 when the May order for security for costs was made.

10On this appeal, the respondent sought to rely on subrule 24(13)4. However, the motion judge made no findings that the case was a waste of time, or a nuisance, or that the party did not have enough assets in Ontario to pay costs.

11There is nothing in the reasons of the motion judge that could support such a finding, and in the absence of any such findings the motion judge had no authority to make the order for security for costs. This is important since the May security for costs order provides that the failure to post security would trigger the most draconian result in family law—striking the pleadings and directing an uncontested trial.

12While the respondent in her written argument relied on other elements that might support the exercise of discretion under subrule 1(8), the June 29, 2021 order under appeal striking pleadings and directing an uncontested trial was based upon the May 21 order directing the posting of security for costs. As a result, the June 29, 2021 order must be set aside as well.

Disposition

13The appeal is allowed. Paragraphs 2 through 4 of the order of May 18, 2021 are set aside. As a consequence, the order of June 29, 2021 is set aside as well.

14For the oral reasons delivered by Kristjanson J., the appeal is allowed. No costs awarded.

___________________________ Kristjanson J.

I agree

Perell J.

I agree

Favreau J.

Date of Oral Reasons: November 12, 2021

Date of Written Release: November 22, 2021

CITATION: Sabijan v. Sabijan, 2021 ONSC 7605

DIVISIONAL COURT FILE NO.: 515/21 DATE: 2021/11/12