Court File and Parties

COURT FILE NO.: CV-21-00667931-0000

DATE: 2022-05-02

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: SERBCAN INC., BOWGRAY INVESTMENTS LIMITED, BONIK INCORPORATED, 1277897 ONTARIO LIMITED, BOKRICA INC., BOZIDAR NIKOLIC, AND SVETLANA NIKOLIC, Appellants

AND:

NATIONAL TRUST COMPANY and THE BANK OF NOVA SCOTIA, Respondents

BEFORE: Koehnen J.

COUNSEL: Roger Horst, R. Szymanski for the Applicants

James D.G. Douglas, Brendan Wong and Veronica Sjolin, for the Respondents

HEARD: April 14, 2022

ENDORSEMENT

[1] The appellants appeal from two awards of Mr. Larry Banack, sitting as a sole Arbitrator. The first award, dated April 23, 2021, granted partial summary judgment to the respondents on several claims. The second, dated July 6, 2021, increased an award for security for costs.

A. The Standard of Review

[2] The appellants submit that the appropriate standard of review is that which applies to a Superior Court Judge. The respondents submit that the standard is reasonableness.

[3] The primary Arbitration Agreement here is an endorsement of Justice Gauthier dated April 4, 2007. That endorsement was arrived at as a result of the parties agreeing, on the eve of trial, that the matter should be referred to arbitration. Paragraph 5 of the endorsement states:

"There will be full rights of appeal."

[4] The appellants submit that, the expression "full rights of appeal" means the fullest rights of appeal possible. That is to say, those applicable to orders of a Superior Court judge.

[5] The respondents submit that "full rights of appeal" must refer to full rights of appeal as set out in the Arbitration Act, 1991.[^1] As Mr. Douglas put it on behalf of the respondents, the endorsement of Justice Gautier does not exclude the standard of review in the Arbitration Act but takes us to it.

[6] I am inclined to agree with the respondents' submission on this point.

[7] The Arbitration Act has a tiered set of rights of appeal. Section 45 of the Act first provides that if the arbitration agreement does not deal with appeals on questions of law, a party may appeal an award to the court on a question of law with leave, which leave shall be granted only if the court is satisfied that the importance to the parties of the matters at stake in the arbitration justifies the appeal and that the determination of the question of law will significantly affect the rights of the parties. The Act goes on to provide in s. 45(3) that, if the arbitration agreement so provides, a party may appeal on a question of fact or on a question of mixed fact and law.

[8] The expression "full rights of appeal" in the endorsement of Gauthier J., in my view, is intended to capture all of the rights set out in s. 45 of the Arbitration Act. Arbitration is a regime separate and apart from civil litigation. Parties who go to arbitration do so to avoid the civil litigation system, or at least some aspects of it. It is well known that arbitration is subject to a different legal regime than civil litigation. It can be expected that parties who arbitrate wish to subject themselves to the arbitration regime rather than the civil litigation regime. That arbitration regime is set out in the Arbitration Act. The parties are of course free to contract out of many aspects of the Arbitration Act but must do so expressly. In my view, paragraph 5 of the endorsement of Gauthier J. does not expressly contract out of any aspect of the Arbitration Act.

[9] That said, neither the Arbitration Act nor the endorsement of Gauthier J. speak to the standard of review applicable on any such appeal.

[10] In Sattva Capital Corp. v. Creston Moly Corp,.[^2] the Supreme Court of Canada held that in the context of commercial arbitrations, the standard of review on questions of law is reasonableness unless the question is one that would attract the correctness standard, such as constitutional questions or questions of law of central importance to the legal system as a whole and outside the adjudicator's expertise.[^3] The Supreme Court of Canada reiterated this view in Teal Cedar Products Ltd. v. British Columbia,[^4] in 2017.

[11] In Canada (Minister of Citizenship and Immigration) v. Vavilov[^5] the Supreme court of Canada noted that going forward, the standard of review from administrative tribunals would be reasonableness unless the statute provides for an appeal to a court, in which case the court hearing the appeal should apply the standard of review determined with reference to the nature of the question and to the Supreme Court of Canada's jurisprudence on appellate standards of review.

[12] As noted, the Arbitration Act contains an appeal mechanism. The question then becomes whether Vavilov was intended to overrule Sattva when it comes to appeals from arbitral panels.

[13] In Ontario First Nations (2008) Limited Partnership v. Ontario Lottery and Gaming Corporation,[^6] Hainey J. concluded that Vavilov did not overrule Sattva for three reasons:

i. The appeal before him arose not as a statutory right but arose out of the agreement of the parties.[^7]

ii. In the years leading up to Vavilov, the Supreme Court had established that the standard of review from a commercial Arbitrator was reasonableness in Sattva and Teal Cedar. Vavilov did not refer to those cases or expressly overrule them.[^8]

iii. "The administrative law standard of review established in Vavilov derives from constitutional considerations that justify deference by the judiciary to the legislature. This principle does not apply to commercial arbitrations. The standard of review for commercial arbitrations is guided by commercial considerations about respect for the decision-makers chosen by the parties. As a result, deference is justified by the parties' contractual intent. It is for this reason that Rothstein J. identified the key differences between administrative decisions and arbitral awards in Sattva and concluded that the judicial review framework for administrative decisions is not applicable in the commercial arbitration context." [^9]

[14] The appellants point to the minority reasons in the Supreme court of Canada's decision in Wastech Services Ltd. V. Greater Sewerage and Drainage District[^10] to urge a different standard of review. In paragraphs 117 – 122 of that decision, the minority noted that two conflicting lines of authority had developed about Vavilov's application to arbitration decisions and expressed the opinion that Vavilov should apply to arbitral appeals under s. 31 of the British Columbia arbitration statute[^11] which contains language similar in substance to that of the Ontario Act. As a result, the minority held that the standard was not reasonableness but was correctness, error of principle or palpable and overriding error depending on the question under appeal. The appellants urge me to apply the standard adopted by the minority in Wastech.

[15] In my view, the correct standard of review here is reasonableness. The majority judgment in Wastech declined to address whether Vavilov applied to awards of commercial Arbitrators. As a result, Sattva and Teal Cedar continue to govern. Until a decision of the Supreme Court of Canada overrules Sattva and Teal Cedar in this regard, the standard of reasonableness to appeals from commercial Arbitrators continues to bind me.

[16] In Vavilov,[^12] the Supreme Court of Canada established the hallmarks of reasonableness as justification, transparency and intelligibility.[^13] A decision is no longer reasonable if there is a failure of rationality in the reasoning process or where the decision is in some respect untenable in light of the relevant factual and legal constraints that bear on it.[^14] The burden is on the party challenging the decision to show that it is unreasonable.[^15] The issue is not whether a rigorous reading of the decision will reveal some sort of flaw or misstep but whether the shortcomings in the decision are sufficiently serious so that the decision no longer exhibits the requisite degree of justification, intelligibility and transparency.[^16]

[17] All of that said, the standard of review would not make any difference to the end result here. I would have come to the same conclusion and upheld the two awards even if I had applied the highest standard of correctness to the Arbitrator's awards.

B. Partial Summary Judgment Award

[18] The appellants submit that the Arbitrator made three errors in awarding partial summary judgment: (i) he dismissed the appellants' claims for improvident sale; (ii) he held that other claims were time barred; and (iii) he breached the principles applicable to awarding partial summary judgment. In my view, the Arbitrator's decisions on these issues are both reasonable and correct.

i. Improvident Sale

[19] The improvident sale and other issues in the arbitration arise out of a real estate project that the applicants pursued in Sudbury during the 1990s and in respect of which it obtained financing from the respondents. The project ultimately failed, and the respondents placed the project into receivership. As part of the receivership, the Receiver sold off four properties between 2000 and 2003. In 2020 Bozidar Nikolic delivered an affidavit which the respondents read as raising a claim for improvident sale of the four properties.

[20] The appellants submit that they are not making a claim for improvident sale but rather, are seeking recovery of damages for property that they allege was improperly seized and disposed of as a result of additional security that the respondents took during the course of the commercial relationship. Damages for the improper seizure arise only if the respondents' additional security had been obtained improperly. The improper obtaining of security is an issue that the Arbitrator allowed to continue to a final hearing. The respondents agreed during the hearing before me that if the security was improperly obtained, the applicants would be entitled to claim damages flowing from that, subject to the usual defences to damage claims such as mitigation and foreseeability. As a result of this clarification, the appeal on the improvident sale issue was taken off the table.

ii. Time Barred Claims

[21] The Arbitrator awarded summary judgment in respect of a number of claims related to advances on the loans because he found they were time-barred. The claims the Arbitrator dismissed all related to allegations that the respondents had improperly delayed advances under their loans, had advanced insufficient funds, had made improper deductions from the advances or had otherwise improperly calculated the amount advanced. In my view, the Arbitrator's award in this regard was both reasonable and correct.

[22] The Arbitrator first analysed the detailed facts surrounding the allegedly time barred claims. He noted that the limitations question turns on the date on which the loan advances were made.[^17] The Arbitrator grouped the various loan advances into categories, noting that for most of them, the respondents took the position that the limitations period began running on April 4, 1993, while the appellants took the position that the limitations period began running on August 12, 1993.

[23] At the relevant time, the limitations period was six years. As a result, the limitation period expired on either April 4, 1999, or August 12, 1999. The appellants did not commence their claim about the loan advances until September 30, 1999, and October 26, 1999. For purposes of argument, the Arbitrator then accepted the appellants' position that the last advance occurred on August 12, 1993 and held that even on the appellants view of events, the claims on the advances were out of time because they were commenced more than 6 years after the last advance.

[24] On the appeal before me, the appellants argued that the relevant claim was issued not on September 30, 1999, but on May 28, 1999, which they submit falls within the limitations period.

[25] While the appellants did issue an application on May 28, 1999, it was for a declaration that the additional security was unenforceable and an injunction restraining the respondents from taking possession of or disposing of the assets that were subject to the additional security. The notice of application set out no grounds for relief.

[26] There was no claim made in that application for any of the matters that the Arbitrator dismissed in his partial summary judgment award. The claims the Arbitrator dismissed as being time barred were claims that the appellants made against the respondents in other proceedings that were commenced on September 30, 1999, or later.

[27] The appellants submit that the claims for advances should deemed to be part of the injunction application because the injunction application contained a "basket clause" seeking:

Such further and other relief as this Honourable Court deems just and appropriate.

[28] I am unable to accept that submission. The purpose of a limitation period is to give a party notice of a claim within a period that the legislature has determined to be reasonable. A claim for "such further and other relief" does not give a defendant notice of anything.

[29] If the appellants' submission were correct, parties could ignore the basic notice provisions that underlie the law of limitations by commencing an initial proceeding on just about any issue, include a basket clause in their prayer for relief and then have the basket clause serve as "notice" of claims based on entirely new factual allegations many years later. That does violence to the policy of timely notice that limitations periods are based on. It also deprives parties of the ability to preserve documents or capture witness recollections in a timely manner.

[30] The appellants further rely on the reasons of Gordon J. of May 2000 in which he dismissed the respondents first motion for summary judgment on the basis of limitation periods.

[31] There are two answers to that submission. First, much has occurred since May 2000. Extensive documentary production has been exchanged and extensive discoveries have occurred. As a result, the record that the Arbitrator had on which to render his decision was far broader than the record available to Gordon J. Second, as already noted, in my view, the reasons of Gordon J were limited to the injunction about the taking of additional security. That claim is proceeding to a hearing before the Arbitrator.

[32] In these circumstances, I cannot see how the Arbitrator's award falls short of the standards of reasonableness in Vavilov. He analysed the facts, accepted the appellants own view of those facts and looked at the appellants own claims for advances that were clearly commenced more than 6 years after the last advance. The appellants position would require the Arbitrator to have accepted that the basket clause for relief in an injunction application also included a claim for monetary damages arising out of the failure to make advances in a timely manner, even though the appellants had commenced separate proceedings specifically for that relief several months later. The Arbitrator's award does not exhibit any failure of rationality in the reasoning process and is not untenable in light of the factual and legal constraints that bear on it. Not only is the award not unreasonable, it is on my view of the record correct in law.

[33] Moreover, by focussing on August 12, 1999, as the expiry of the limitations period, the Arbitrator was giving the appellants the benefit of the doubt. In fact, the evidence in the record demonstrates that the last advance was made on April 4, 1993. That is significant because it would indicate that even if the appellants application of May 28, 1999, could be said to include claims on advances, it too was time barred. The appellants' own records show the last advances being made on February 24, 1993,[^18] in March 1993,[^19] and March 1, 1993[^20] depending on the project. The respondents note that the advance that the appellants say was made on March 1, 1993 was actually made on April 4, 1993.[^21] In all cases the limitations period would expire no later than 6 years after the advance was made. The appellants did not rebut those points.

[34] The confusion about the last advance being made on April 4, 1993, as the respondents contend or August 12, 1993, as the appellants contend arises out of the distinction between an advance and a use of the advance. It appears that the respondents made the final advance of $389,854.06 on April 4, 1993. The appellants spent a portion of those funds right away. A portion of those funds was held back for future disbursements. The last of those disbursements was made on August 12, 1993. The appellants did not refute this.

[35] In those circumstances, the claims about advances would be time barred even if the May application were deemed to give notice of such claims because even the May application was commenced more than 6 years after April 4, 1993.

iii. Partial Summary Judgment

[36] The appellants next submit that the Arbitrator erred in granting partial summary judgment.

[37] In doing so, the Arbitrator correctly identified the concerns about partial summary judgment that the Supreme Court of Canada set out in Hryniak v. Mauldin.[^22] The Arbitrator recognized that partial summary judgment awards run the risk of duplicative proceedings or inconsistent findings of fact. He concluded that partial summary judgment was nevertheless the most proportionate and expeditious means to adjudicate the claims about advances. He concluded that the issues for summary judgment could be readily bifurcated from the rest of the claim and could be disposed of without the need for any factual determinations. The facts related to the advances were discrete from the facts relating to the remaining causes of action as a result of which there was no risk of duplicative proceedings or inconsistent findings of fact.[^23] The risk of duplicative or inconsistent findings is reduced even further here because the Arbitrator who decided the summary judgment motion will also be presiding over the final hearing.

[38] Once again, the award exhibits no failure of rationality of the sort that would make it unreasonable under the approach of the Supreme Court of Canada in Vavilov.

[39] Before me the appellants also raised several other concerns that the Ontario Court of Appeal had raised about partial summary judgment motions in Butera v. Chown, Cairns LLP.[^24]

[40] First, partial summary judgment motions give rise to delay because of appeals.[^25] Appeals from Arbitrators are, however, generally faster to address than appeals from judges because it is generally faster to obtain motion dates in the Superior Court of Justice than it is to obtain appeal dates in the Court of Appeal. It is also generally faster to obtain hearing dates from Arbitrators than it is to obtain trial dates from courts. The issue of delay in arbitrations is therefore less serious than in the courts.

[41] Second, motions for partial summary judgment are expensive.[^26] The Arbitrator here had much more information about the case than a Superior Court judge usually has when faced with a summary judgment motion. Here, the Arbitrator had the advantage of case managing the case; an advantage most Superior Court judges do not have when faced with summary judgment motions. The Arbitrator concluded that there would be efficiencies gained in awarding partial summary judgment. Given his greater experience with the matter, the Arbitrator's finding in this regard deserves deference.

[42] Third, the Court of Appeal expressed concern about further over burdening an already overburdened judicial system with additional motions.[^27] This concern is inapplicable to commercial arbitrations where Arbitrators decide how much work they can take on.

[43] On my view the record, severing the complaints about advances from the arbitration will save considerable time at trial. The appellants argue that National Trust delayed making the advances. National Trust defends by saying that the appellants failed to meet the lengthy list of conditions precedent for each advance. Resolution of that issue on the facts would involve a detailed analysis of each request for an advance, an analysis of the conditions precedent for each advance, and an analysis of whether those conditions precedent had been met. The advances claim relates to 21 advances made between December 1990 and February 1993. That involves a painstaking and time-consuming degree of detail to examine transactions that occurred 30 years ago. If all of that can be avoided because of a successful limitations defence, then summary judgment is in my view a proportionate and appropriate way of addressing the issue.

D. Security for Costs

[44] The second award from which the appellants appeal is an award of the Arbitrator dated July 6, 2021, by which he required the appellants to post additional security for costs payable in three tranches between August and October 2021.

i. The Standard of Review

[45] The appellants submit that the Arbitrator erred in principle and made a palpable and overriding error in his interpretation of the terms addressing security for costs in the agreement to arbitrate.

[46] The Respondents submit that for the appellants to appeal under section 45 of the Arbitration Act, 1991 the ruling under appeal must constitute an "award" and that the Security for Costs Order is not an "award" under the Arbitration Act.

[47] In Inforica Inc. v. CGI Information Systems and Management Consultants Inc.[^28] the Court of Appeal concluded that the application judge did not have jurisdiction to entertain an application to set aside an Arbitrator's order for security for costs, because the ruling was procedural in nature.[^29] Sharpe J.A. explained that "the term [award] has been held to connote the judgment or order of an arbitral tribunal that "disposes of part or all of the dispute between the parties" and that "[m]atters relating to the conduct of the arbitration are not awards but, rather, are procedural orders and directions."[^30]

[48] In Environmental Export International of Canada Inc. v. Success International Inc., MacPherson J. (as he then was) came to a similar conclusion holding that "[t]here is nothing in the Arbitration Act providing for appeals from, or applications to set aside, decisions of Arbitrators on procedural points. It would be wrong… for the courts to invent such a remedy and inject it into the arbitration process."[^31]

[49] The appellants submit that the issue of security for costs is governed by s. 6 of the Arbitration Act, not by the appeal provisions of s. 45. Section 6 provides that courts shall not intervene in arbitrations except:

(2) To ensure that arbitrations are conducted in accordance with arbitration agreements.

[50] The appellants submit that the purpose of their appeal is to ensure that the arbitration is conducted in accordance with the arbitration agreement.

[51] In my view, some of the issues here arise under s. 6 and others arise under s. 45 and would implicate the principles set out in Inforica. I will deal with each in turn.

ii. Amount of Security for Costs Is Fixed by Agreement to Arbitrate

[52] The appellants first argue that the Arbitrator had no jurisdiction to increase security for costs because that security was fixed in the endorsement of Justice Gauthier of April 7, 2007. The provision on which the appellants rely provides:

The security for costs in the proceeding before me will stand as security for the arbitration.

[53] The appellants submit that this provision means that the security for costs that were posted in 2007 was the maximum amount of security for costs that it was possible to order.

[54] This issue gives rise to a review under s. 6 of the Arbitration Act, because it involves ensuring that the arbitration is conducted in accordance with the arbitration agreement rather than an appeal on a more general issue. As a result, the Inforica principles do not apply. The standard of review is reasonableness.

[55] The Arbitrator disagreed with the submission that the arbitral agreement fixed the security for costs amount permanently.[^32] He noted that there was no language in the endorsement of Justice Gauthier that limited the rights of either party to vary the amount of security. The provision in question merely said that the funds which had been paid into court for security would remain in court and stand as security in the arbitration.

[56] Even if I gave the appellants the benefit of every doubt and held that the correctness standard applies, I would agree with the Arbitrator's interpretation. His interpretation accords with the plain meaning of the words of the agreement. The appellants advanced no argument to depart from the plain meaning of those words.

iii. Quantum of Security Ordered

[57] The appellants submit that the Arbitrator erred in including one half of the Arbitrator's costs (or $271,200) as part of the security because those costs had already been dealt with in paragraph 3 of the endorsement of Gauthier J. which states:

The costs of the arbitration have been agreed to be borne "upfront" i.e. in the first instance, by the defendant, National Trust.

[58] This also gives rise to a review under s. 6 of the Arbitration Act because the essence of the argument is that the Arbitrator is not conducting the arbitration in accordance with the arbitration agreement. Again, the standard of review is reasonableness.

[59] The respondents submit that paragraph 3 of the endorsement of Gauthier J. simply means that the respondents will fund the arbitration in the first instance in the sense that they will pay the Arbitrator his fees. It does not, however, limit the respondents in any way from seeking security for costs for those fees. I am inclined to agree with that interpretation. It strikes me that if a party intends to deprive an opposing party of a right they have at law, the right must be removed with clear, explicit language.

[60] The arbitration agreement is silent about the right to seek security for costs. It is therefore reasonable to interpret the agreement as having no bearing on the ability to seek security for costs.

[61] In addition, the appellants submit that the Arbitrator erred by saying in paragraph 56 of his award that the appellants agreed that the $271,200, should form part of the order for security for costs. The appellants submit they made no such agreement but rather said that in the absence of a term about arbitration costs in the arbitration agreement, the amount would be reasonable. There is, however, no evidence of that before me. I have only the submission of counsel. In my view, that sort of issue would have been better resolved either by an attendance before the Arbitrator or by filing an evidentiary record with this court to which the respondents could respond and/or on which they could cross-examine if necessary.

[62] Moreover, even if the endorsement of Gauthier J. could bear the interpretation that the appellants contend for, it does not mean that the provision cannot be altered in light of appropriately changed circumstances which will be discussed below.

[63] The remaining issues that the appellants raise in connection with security for costs do not involve s. 6 of the Act and are therefor caught by the principles in Inforica. That is to say, they are not subject to appeal because they are procedural orders. I will nevertheless consider the appeal of those issues on the merits, especially because they also relate to the $271,200 of arbitration costs.

iv. Changed Circumstances

[64] The appellants agree that security for costs is a discretionary issue in respect of which the standard of review is error in principle or palpable and overriding error. It is worth noting that the Arbitrator applied the same test to increase the amount of security as the appellants urged me to apply in paragraph 44 of their factum. In those circumstances, it cannot be said that the Arbitrator erred in principle.

[65] The focus of the argument on this issue was the requirement for changed circumstances. There are several changed circumstances here. Among other things, the Arbitrator noted that the initial security for costs award was made in the injunction application alone but that the arbitration before him involved three additional proceedings,[^33] there was a significant gap between the security posted and the respondents' actual costs,[^34] that gap was not reasonably foreseeable,[^35] the parties expected a trial within a few years of the security being posted but 18 years have passed without a determination on the merits,[^36] and there have been additional steps taken such as additional discoveries, written interrogatories and a mediation. In addition, the initial amount posted did not contemplate the procedural steps involved in the arbitration.[^37]

[66] In those circumstances the Arbitrator had ample evidence on which to conclude that there had been a change in circumstances to warrant increased security for costs. I can see no error in principle and no palpable and overriding error in increasing the security.

[67] Even if the standard of review were correctness on this issue, I would have concluded that the Arbitrator was correct in increasing costs even in the absence of any alleged agreement by the appellants to include the costs of the arbitration in the increased security amount.

[68] In addition, to the foregoing, there is ample other evidence in the record to warrant increased security. By way of example, at the outset of the arbitration, the appellants filed a 1,341 page affidavit sworn by Bozidar Nikolic, the principal of the corporate appellants. This affidavit raised a multiplicity of new issues. This was confirmed when the appellants filed a Statement of Issues that listed 48 issues for determination in the arbitration. By comparison, the appellants' pre-trial brief from 2005 listed just eleven issues for determination.

v. Delay Allegation

[69] The appellants submit that the Arbitrator erred by failing to find that the respondents delayed in seeking security for costs.

[70] The Arbitrator addressed the issue of delay and rejected the appellants' submission that the respondents had delayed. I can see no error in principle and no palpable and overriding error of fact in the Arbitrator's decision in this regard nor have the appellants pointed to any. The appeal on this point is more that the appellants do not like the conclusion the Arbitrator came to about delay than it is about any error of principle or palpable and overriding error of fact.

vi. Conduct of the Respondents

[71] The appellants submit that the Arbitrator erred in failing to consider whether the conduct of the respondents had depleted the appellants' assets. In doing so they rely on a decision of Reid J., in Cigar500.Com Inc. v Ashton Distributors Inc.[^38] to the effect that:

There can be no question that an injustice would result if a meritorious claim were prevented from reaching trial because of the poverty of a plaintiff. If the consequence of an order for costs would be to destroy such a claim, no order should be made. Injustice would be even more manifest if the impoverishment of plaintiff were caused by the very acts of which plaintiff complains in the action.

[72] There is, however, no evidence here that the appellants are impoverished let alone that any impoverishment was caused by the respondents. The evidence, rather, is that the respondents have arranged their affairs so as to be judgment proof in Ontario. That evidence suggests that there is a significant distinction between being judgment proof on the one hand and impoverished on the other. There are good reasons to require security for costs from parties who have made themselves judgment proof but are by no means impoverished.

[73] I cannot say that it is an error in principle or that it is unreasonable to interpret paragraph 3 of Justice Gauthier's endorsement to allow the appellants to seek increased security for costs when: (i) it has been 18 years since the last security for costs amount was fixed; (ii) when it has been 15 years since the matter was directed to arbitration; (iii) when the issues have multiplied; and (iv) when the appellants appear to have rendered themselves judgment proof. There too, I would uphold the award even if the standard of correctness applied.

E. Disposition and Costs

[74] For the reasons set out above, I dismiss the appeals from the partial summary judgment and security for costs awards and affirm both awards.

[75] Costs should follow the event. Both sides' bills of costs are relatively close in amount. The appellants incurred actual costs, disbursements and HST of $88,106.76. The respondents incurred actual costs, disbursements and HST of $83,010.25. I fix costs in favour of the respondents on a partial indemnity scale at $50,187.37 including HST and disbursements as requested.

Koehnen J.

Date: 2022-05-02

[^1]: Arbitration Act, 1991, SO 1991, c 17. [^2]: Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 SCR 633 [^3]: Sattva at para. 106. [^4]: Teal Cedar Products Ltd. v. British Columbia, 2017 SCC 32 [^5]: Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65 [^6]: Ontario First Nations (2008) Limited Partnership v. Ontario Lottery and Gaming Corporation, 2020 ONSC 1516 [^7]: First Nations at para. 65 [^8]: First Nations at para. 71 [^9]: First Nations at para. 72 [^10]: Wastech Services Ltd. v. Greater Sewerage and Drainage District, 2021 SCC 7 at paras. 117 – 122. [^11]: Arbitration Act R.S.B.C. 1996, c. 55 [^12]: Vavilov 2019 SCC 65 [^13]: Vavilov at para. 99 [^14]: Vavilov at para. 101 [^15]: Vavilov at para. 100 [^16]: Vavilov at para 100 and 102. [^17]: Summary Judgment Award paragraph 46 [^18]: CaseLines p. B-1-2680. [^19]: CaseLines B-1-1510 [^20]: CaseLines B-1-4187 although this appears to be in error. The respondent says this advance was actually made on April 4, 1993: see CaseLines A1571. [^21]: CaseLines A1571 [^22]: 2014 SCC 7 at para 49. [^23]: Summary Judgment Award at para. 51 [^24]: Butera v. Chown, Cairns LLP, 2017 ONCA 783 [^25]: Butera at para. 30 [^26]: Butera at para. 31 [^27]: Butera at para. 32. [^28]: Inforica Inc. v. CGI Information Systems and Management Consultants Inc., 2009 ONCA 642 [^29]: Ibid. at para 30. [^30]: Ibid. at para 29. [^31]: Environmental Export International of Canada Inc. v. Success International Inc., [1995] O.J. No. 453 (Gen. Div.), at para. 14. [^32]: Security for Costs Award at para. 53. [^33]: Security for Costs Award paras. 12, 13 and 16. [^34]: Security for Costs Award para. 47. [^35]: Security for Costs Award para. 48. [^36]: Security for Costs Award para. 48. [^37]: Security for Costs Award para. at para. 50. [^38]: 2009 CanLII 46451 (ON SC) at paragraph 37 citing John Wink Ltd. v. Sico Inc.