Zeitoun et al. v. The Economical Insurance Group [Indexed as: Zeitoun v. Economical Insurance Group]

96 O.R. (3d) 639

Court of Appeal for Ontario,

Doherty, Moldaver, MacPherson, Simmons and Cronk JJ.A.

May 19, 2009

Civil procedure -- Appeal -- Appeal from order of master -- Standard of review -- No principled reason existing to distinguish between standard of review on appeal from master and on appeal from judge.

Civil procedure -- Costs -- Security for costs -- Master's reference to defendant's prima facie entitlement to security for costs based on plaintiffs' non-residence constituting misstatement but reasons as whole indicating that master did not reverse onus -- Master finding that there was no evidence that plaintiffs were impecunious and that claim did not have good chance of success -- Motion judge erring in setting aside order for security for costs.

The defendant brought a motion for an order for security for costs. The hearing apparently proceeded on the assumption that the defendant had a prima facie right to security for costs arising out of the non-residency of the plaintiffs. The master found that impecuniosity was not shown and that it could not be said that the claim had a good chance of success. The order was granted. The plaintiffs moved successfully to set aside the order. The motion judge substituted his own view of the evidence on impecuniosity for that of the master and found that the motion judge had imposed too high an onus on the plaintiff in relation to the merits of the action. The Divisional Court allowed the defendant's appeal. The plaintiffs appealed.

Held, the appeal should be dismissed.

There is no reasoned basis to distinguish between the decision of a master and that of a judge for the purposes of the standard of review on appeal. A decision of a master will be interfered with only if the master made an error of law or exercised his or her discretion on wrong principles or misapprehended the evidence such that there was a palpable or overriding error. The motion judge erred in law in treating the appeal as a hearing de novo.

Rule 56.01 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 does not create a prima facie right to security for costs, and the master's reference to the defendant's prima facie entitlement to security for costs was a misstatement. However, considering the reasons as a whole, the master did not reverse the onus. There was no basis upon which to interfere with the master's analyses of the evidence or her application of the relevant principles. The result reached by the master was not unreasonable.

APPEAL from order of the Divisional Court (Lederman, Swinton and Low JJ.) (2008), 2008 CanLII 20996 (ON SCDC), 91 O.R. (3d) 131, [2008] O.J. No. 1771 (Div. Ct.) allowing an appeal from the order setting aside an order for security for costs.

Cases referred to Housen v. Nikolaisen, [2002] 2 S.C.R. 235, [2002] S.C.J. No. 31, 2002 SCC 33, 211 D.L.R. (4th) 577, 286 N.R. 1, [2002] 7 W.W.R. 1, J.E. 2002-617, 219 Sask. R. 1, 10 C.C.L.T. (3d) 157, 30 M.P.L.R. (3d) 1, 112 A.C.W.S. (3d) 991; L. (H.) v. Canada (Attorney General), [2005] 1 S.C.R. 401, [2005] S.C.J. No. 24, 2005 SCC 25, 251 D.L.R. (4th) 604, 333 N.R. 1, [2005] 8 W.W.R. 1, J.E. 2005-845, [2005] R.R.A. 275, 262 Sask. R. 1, 24 Admin. L.R. (4th) 1, 29 C.C.L.T. (3d) 1, 8 C.P.C. (6th) 199, 138 A.C.W.S. (3d) 852 [page640]

G. Joseph Falconeri and Bryan Rumble, for plaintiffs (appellants).

David Zuber and Joanna Wojcik, for defendant (respondent).

Endorsement

[1] Appeal Book Endorsement by THE COURT: -- We are in substantial agreement with the Divisional Court. For the reasons identified by Low J. in her insightful analyses (see especially paras. 26, 36 and 40-41), there is no reasoned basis to distinguish between the decision of a master and that of a judge for the purposes of the standards of review on appeal. Those standards are set out in Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235, [2002] S.C.J. No. 31 and L. (H.) v. Canada (Attorney General), 2005 SCC 25, [2005] 1 S.C.R. 401, [2005] S.C.J. No. 24.

[2] On the merits, we also agree with the Divisional Court's conclusion. The master's reference to the moving party's "prima facie" entitlement to security for costs was a misstatement; however, considering the reasons as a whole, we are satisfied the master did not reverse the onus. There was no basis upon which to interfere with the master's analyses of the evidence or her application of the relevant principles. Nor is the result reached by the master unreasonable.

[3] The appeal is dismissed. Costs to the respondent on a partial indemnity basis in the amount of $10,000, inclusive of disbursements and GST.

Appeal dismissed.