Court of Appeal for Ontario

Date: 2018-12-07

Docket: M49680 / M49816 (C65552)

Motions Judge: Huscroft J.A.

Between

Vladislav Bukshtynov, Katerina Bukshtynova and Ksenia Bukshtynova, a minor under the age of 18 years, by her Litigation Guardian, the said Vladislav Bukshtynov

Responding Parties (Appellants)

and

McMaster University, Flying Angels Running Club, George Kerr, Hwang Lee and/or John Doe Runner

Moving Parties (Respondents)

Counsel

Bonnie Roberts Jones, for the appellants (responding parties)

Alexander B. Paul and Kaleigh Sonshine, for the respondent (moving party), McMaster University

Bradley M. Remigis, for the respondents (moving parties), Flying Angels Running Club, George Kerr and Hwang Lee

Heard: December 6, 2018

Reasons for Decision

Introduction

[1] The respondents bring motions for an order requiring the appellant Vladislav Bukshtynov to post security for costs incurred and expected to be incurred on the appeal.

[2] The motion is granted for the reasons that follow.

Background

[3] The appellant Vladislav Bukshtynov was injured while running on an indoor track at McMaster University. The appellant fell after coming into contact with a member of the Flying Angels Running Club and required emergency surgery to repair his shoulder. He sued the respondents, alleging negligence and breach of statutory duty.

[4] Following a three-week trial, the jury returned a verdict that McMaster University and Hwang Lee were not liable. The Flying Angels Running Club and George Kerr were found 60% liable, while the appellant was found 40% contributorily negligent.

[5] The appellant was awarded damages of $101,885. The appellant was required to pay McMaster University's costs of $95,000, and $69,156 for the costs of the Running Club. The Running Club was required to pay costs of $43,108 to the appellant.

Security for Trial Costs

[6] McMaster University sought security for costs prior to the trial. The motion was settled on the basis that the appellant would purchase After the Event insurance covering $100,000 in costs.

[7] Prior to trial, the insurance provider suspended the appellant's insurance coverage when he refused to accept a settlement offer pursuant to r. 49 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194. McMaster then brought a second motion for security for costs, and this was settled on the basis that the appellant agreed to post $86,161.37 as security.

The Positions of the Parties

[8] McMaster University takes the position that the appeal is frivolous and vexatious within the meaning of r. 61.06(1)(a). In the alternative, it says that security for costs should be awarded under r. 61.06(1)(b), on the basis that the appellant is ordinarily resident outside of Ontario, in Florida; the appeal has no merit; and the appellant is not impecunious. The Running Club, George Kerr and Hwang Lee support McMaster University's position and emphasize that the appellant cannot demonstrate that his appeal has a good chance of success.

[9] The appellant argues that his appeal cannot be said to be frivolous, in the sense that it is readily recognizable as devoid of merit with little prospect of success, or vexatious, in that it is brought for some other improper purpose. The appellant argues, further, that although he is ordinarily resident outside of Ontario, it would not be just to impose security for costs because his appeal has a good chance of success and it would be "financially difficult or impossible" for him to post security for costs. The appellant does not assert impecuniosity.

Discussion

[10] I see no basis to grant security for costs under r. 61.06(1)(a). It cannot be said that the appeal is frivolous and vexatious. The fact that the jury returned a zero liability verdict in favour of McMaster and Hwang Lee does not demonstrate that the appeal is frivolous and vexatious. Nor do I regard the appellant's conduct during the litigation – in particular, his unwillingness to accept what the trial judge considered to be reasonable settlement offers and his refusal to engage in any mid-trial pretrial – as support for the conclusion that the appeal is frivolous and vexatious. Nothing in the material before me rises to the high standard required to establish that an appeal is frivolous and vexatious.

[11] Turning to r. 61.06(1)(b), this court discussed the overarching approach to be taken in Yaiguaje v. Chevron Corporation, 2017 ONCA 827, 138 O.R. (3d) 1, at paras. 24-25:

Courts in Ontario have attempted to articulate the factors to be considered in determining the justness of security for costs orders. They have identified such factors as the merits of the claim, delay in bringing the motion, the impact of actionable conduct by the defendants on the available assets of the plaintiffs, access to justice concerns, and the public importance of the litigation. See: Hallum v. Canadian Memorial Chiropractic College (1989), 70 O.R. (2d) 119 (H.C.); Morton v. Canada (Attorney General) (2005), 75 O.R. (3d) 63 (S.C.); Cigar500.com Inc. v. Ashton Distributors Inc. (2009), 99 O.R. (3d) 55 (S.C.); Wang v. Li, 2011 ONSC 4477 (S.C.); and Brown v. Hudson's Bay Co., 2014 ONSC 1065, 318 O.A.C. 12 (Div. Ct.).

While this case law is of some assistance, each case must be considered on its own facts. It is neither helpful nor just to compose a static list of factors to be used in all cases in determining the justness of a security for costs order. There is no utility in imposing rigid criteria on top of the criteria already provided for in the Rules. The correct approach is for the court to consider the justness of the order holistically, examining all the circumstances of the case and guided by the overriding interests of justice to determine whether it is just that the order be made.

[12] In my view, having regard to the relevant circumstances, an order for security for costs is in the interests of justice in this case.

[13] I begin with the fact that the appellant is not a resident of Ontario. He resides in Florida. That is not determinative, but it is significant.

[14] Secondly, his appeal does not appear to be strong. It concerns evidentiary decisions made by the trial judge about the admission of hearsay evidence and the exclusion of correspondence from McMaster University to the Ministry of Labour, to which it was required to report Mr. Bukshtynov's accident. Those decisions are entitled to deference and are difficult to disturb on appeal.

[15] The appellant also argues that the trial judge erred in instructing the jury, in particular concerning the Occupier's Liability Act, R.S.O. 1990, c. O.2, and loss of future income. Although these arguments allege legal errors that are subject to review for correctness, they do not appear to me to be strong.

[16] Thirdly, the appellant does not claim to be impecunious. On the scant evidence before me, I am not satisfied that costs of the appeal is a matter of financial hardship for the appellant. The appellant says that it will be "financially difficult or impossible" for him to raise the money required to post security for costs, yet he lists an annual joint income of just under USD$140,000, from which he manages to fund his daughter's education at a cost of $57,000 annually. The appellant attests that he had to open four credit lines in order to fund the order for security for trial costs, but he has not provided anything close to a complete financial picture.

[17] In my view, it is significant that the appellant agreed to post security for costs for the trial. His circumstances have not changed so as to require a different result for the appeal. Indeed, security sought for the appeal is much less than the amount the appellant posted for the trial.

[18] I do not accept that it is appropriate to deny McMaster University security for costs simply because it is a large enterprise. The circumstances of this case have nothing in common with Chevron.

[19] In all of the circumstances of this case, it is in the interests of justice to order security for costs. That said, in my view the amounts sought by the respondents – $25,000 each – are excessive. I would reduce the amounts to $15,000 on the McMaster University motion and $10,000 on the Running Club motion.

Disposition

[20] The appellant is ordered to post security for costs of $15,000 on the McMaster University motion and $10,000 on the Running Club motion.

[21] McMaster University is entitled to its costs on this motion in the agreed amount of $5,000 and the Running Club is entitled to costs in the agreed amount of $2,500, both amounts inclusive of taxes and disbursements.

Grant Huscroft J.A.