Following the dismissal of an urgent injunction application regarding a commercial tenancy, the respondent landlord sought costs against the applicant tenant and two of its non-party shareholders personally.
The court found that the 'person of straw' test was not met, as the applicant was the proper party to the lease dispute.
However, the court exercised its inherent jurisdiction to prevent an abuse of process, finding that the two shareholders engaged in gross misconduct by authorizing and funding the litigation while withholding funds from the insolvent applicant, thereby depriving it of the ability to pay rent or a costs award.
Costs were awarded on a partial indemnity scale, fixed at $29,405, payable jointly and severally by the applicant and the two shareholders.