CITATION: Brown v. Regional Municipality of York, 2016 ONSC 1604
COURT FILE NO.: CV-14-00513139
DATE HEARD: 20160208
ENDORSEMENT RELEASED: 20160307
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Sylviette Brown as Trustee of Property Roll No. 1970 000 012 76100 0000 (Georgina) and Sylviette Brown on her own behalf as owner of Little River Farms v. The Corporation of the Regional Municipality of York, the Corporation of the Town of Georgina and the Municipal Property Assessment Corporation (Region 14)
BEFORE: Master B. McAfee
COUNSEL: C. Painter for the moving parties, the defendants, the Corporation of the Regional Municipality of York and the Corporation of the Town of Georgina
S. Brown, in person, responding parties, the plaintiffs
REASONS FOR DECISION
[1] This is a motion brought by the defendants, the Corporation of the Regional Municipality of York and the Corporation of the Town of Georgina (the moving defendants) for an order for security for costs.
[2] The plaintiffs oppose the motion.
[3] Although the plaintiffs brought a motion for leave to amend the statement of claim returnable January 29, 2016, that motion did not proceed. The plaintiffs failed to file material in support of their notice of motion (see endorsement of Justice Dunphy dated January 29, 2016). The motion for security for costs proceeded based on the current pleadings.
[4] The moving defendants rely on Rule 56.01(1)(c) of the Rules of Civil Procedure:
56.01(1) The court, on motion by the defendant or respondent in a proceeding, may make such order for security for costs as is just where it appears that,
(c) the defendant or respondent has an order against the plaintiff or applicant for costs in the same or another proceeding that remain unpaid in whole or in part;.
[5] The application of Rule 56.01 involves a two-step analysis. The first step of the analysis requires the moving defendants to establish that it appears that the plaintiffs fall into one of the categories set forth at Rule 56.01(a) to (f). If the moving defendants discharge their onus and establish that it appears that the plaintiffs fall into one of the categories, the second step of the analysis requires the plaintiffs to establish that it would be unjust to require posting of security for costs (see Brown v. Hudson’s Bay Co., 2014 ONSC 1065 (SCJ) at paras 33-52).
[6] The moving defendants have satisfied their initial onus to establish that it appears that the moving defendants have an order against the plaintiffs for costs in the same or another proceeding that remain unpaid in whole or in part.
[7] In 2002, Sylviette Brown carrying on business as Little River Farms commenced action no. C-1166/02 at Kitchener (later transferred to Toronto and assigned action no. CV-07-CV342315) against the Corporation of the Regional Municipality of York and the Corporation of the Town of Georgina and others. By order dated October 30, 2009, the action was dismissed for delay with costs. The evidence before me is that the Regional Municipality of York alone incurred $95,023.96 in legal fees. I was not referred to any evidence that steps have been taken to assess those costs. No costs have been paid.
[8] In 2011, Sylviette Brown as Trustee of Property Roll No. 1970 012 76100 0000 (Georgina) and Sylviette Brown on her own behalf as owner of Little River Farms, commenced action no. CV-11-436568 against the Corporation of the Town of Georgina and others. On September 25, 2012, the action was dismissed by Justice Perell. On November 26, 2012, Justice Perell awarded Georgina substantial indemnity costs in the amount of $18,118.49. On January 9, 2013, the plaintiffs’ appeal to the Court of Appeal was dismissed for delay with costs fixed in the amount of $750.00. The plaintiffs then brought a motion to introduce new evidence and to set aside or vary Justice Perell’s order dated September 25, 2012. On May 6, 2013, Justice Perell struck the statement of claim and granted leave to the plaintiffs to deliver a fresh as amended statement of claim, to be prepared by a lawyer, within 30 days. The plaintiffs did not deliver a fresh as amended statement of claim. On July 16, 2013, Justice Perell awarded costs in favour of Georgina in the amount of $3,517.00. On July 2, 2014, the plaintiffs’ appeal to the Divisional Court was dismissed for delay with costs fixed in the amount of $750.00. On December 9, 2014, Georgina’s appeal from part of the May 6, 2013 order was allowed with costs fixed in the amount of $5,000.00. No costs have been paid by the plaintiffs.
[9] The onus then shifts to the plaintiffs to satisfy the court that an order for security for costs would be unjust. The plaintiffs have not satisfied their onus to establish that an order for security for costs would be unjust.
[10] The plaintiffs do not argue that they are impecunious (see supplementary affidavit of Murray Brown sworn January 4, 2016 at para 10). To the extent that paragraph 10 of the supplementary affidavit of Murray Brown also states that there have been written assurances that the farm property will not be disposed of or encumbered, I was not referred to evidence confirming ownership, value of and equity in the farm property.
[11] If I am wrong and the plaintiffs do assert that they are impecunious, I am not satisfied that the plaintiffs are impecunious. The evidentiary threshold for establishing impecuniosity is high. The threshold can only be reached if there is complete and accurate disclosure of the plaintiffs’ income, assets, expenses, liabilities and borrowing ability with full supporting documentation. This evidence is not before me.
[12] There is evidence from the plaintiff’s husband, Murray Brown, who states in his affidavit sworn November 26, 2015 at paragraph 12, “should the plaintiffs not have sufficient cash flow to rebuild and repair the defendants have tentatively guaranteed the plaintiffs will not be permitted to continue and finally have the matter adjudicated on their merits.” There is no direct evidence from the plaintiffs in this regard nor is there evidence setting out the financial situation of the plaintiffs with any particularity to support Mr. Brown’s assertion.
[13] Where impecuniosity has not been established, a legitimate factor in determining whether it would be unjust to order security for costs is whether the claim has a good chance of success (see Zeitoun v. Economical Insurance Group, 2008 CanLII 20996 (ON SCDC), 2008 CarswellOnt 2576 (Div.Ct) at para 50; affirmed 2009 ONCA 415).
[14] As was stated in Brown at paragrah 50, citing Beatross Estate v. Woolfson, 2013 ONSC 6819 (Ont. Master), “a motion for security for costs is not the venue for a summary judgment analysis but apparent strength of the case is a proper consideration…in the simpliest terms, the rule provides for a form of risk analysis. The more likely it is that the defendant will be entitled to costs and unable to recover them the stronger the case for security.”
[15] The same plaintiffs have brought other proceedings seeking similar relief (see affidavit of William Irwin sworn June 30, 2015 at paras 3-4, 6-8, 11-12). The plaintiffs did not succeed in obtaining any judgment in their favour in the other proceedings. Even if similar relief was not sought in previous proceedings, on the basis of the evidence before me I am not satisfied that the claim has a good chance of success. The plaintiffs rely in large part on aerial maps. The maps and other evidence before me are not sufficient to satisfy me that the claim has a good chance of success.
[16] The plaintiffs have not satisfied me that an order for security for costs would be unjust. The plaintiffs shall post security for the costs of the moving defendants.
[17] With respect to the quantum of security, in my view the amount sought as set out in the bill of anticipated costs is high. In particular, the amounts sought for anticipated motions, experts and trial are high. In my view a fair and reasonable amount that the plaintiffs could expect to post for security for costs is the all inclusive sum of $60,000.00. The security shall be paid into court by way of cash, certified cheque or standby letter of credit, said letter of credit to be in a form approved by the moving defendants.
[18] As this action has not progressed beyond the pleadings stage, it is just and reasonable that the security be posted in instalments.
[19] The moving defendants were successful on the motion and are entitled to costs. Having regard to the circumstances of the motion a fair and reasonable amount that the plaintiffs could expect to pay for costs of the motion is the all inclusive sum of $3,000.00, payable within 30 days.
[20] Order to go as follows:
- The plaintiffs shall pay into court as security for the costs of the moving defendants the all inclusive sum of $60,000.00, payable by cash, certified cheque or standby letter of credit, said standby letter of credit to be in a form approved by the moving defendants, payable as follows:
a. $10,000.00 within 60 days of today’s date;
b. The further sum of $20,000.00 on or before 30 days prior to examinations for discovery;
c. The further sum of $30,000.00 on or before 90 days prior to trial.
- Costs of the motion are fixed in the all inclusive sum of $3,000.00 payable by the plaintiffs to the moving defendants within 30 days.
Master B. McAfee
DATE: March 7, 2016