Court File and Parties

COURT FILE NO.: CV-19-00619890-0000 DATE: 20230509 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: RICHARD SELWYN, Plaintiff – and – LERNERS LLP, Defendant

BEFORE: E.M. Morgan J.

COUNSEL: Richard Selwyn, in person Antonios Antoniou and Miriam Hanna, for the Defendant

HEARD: May 8, 2023

Security for Costs

[1] The Defendant moves for security for costs, to be paid into court by the Plaintiff who resides outside of Ontario and Canada.

[2] The Plaintiff has commenced this hearing with a complaint about the sequence of materials as they appear on CaseLines. He also complains that at least one document – specifically, the Plaintiff’s Reply – was missing from the Motion Record and he had to upload his Reply himself. He says that the way the materials have been uploaded is prejudicial to him.

[3] Having made that submission, the Plaintiff appears to have managed quite well in sifting through the filed materials; he has located and identified all of the documents filed in CaseLines by the Defendant, and has uploaded his own documents as well. That comes as no surprise. The Plaintiff is a self-represented litigant in Ontario, but he is a solicitor in the U.K. and is very familiar with legal materials and procedures. He is also long experienced with Ontario litigation as he has been engaged in litigation in the courts of this province in his own family law proceedings.

[4] Defendant’s counsel has properly paginated and hyperlinked each document. The material all has been uploaded to CaseLines in the usual way, and to me looks no different in CaseLines as every other motion. I do not understand the Plaintiff’s complaint, and there is nothing I can do about the sequence of the materials that appear in CaseLines. I have succeeded in navigating the material, and apparently so has the Plaintiff.

[5] The Plaintiff resides in the United Kingdom. The Defendant is a law firm that represented him in family law proceedings in Ontario. The litigation between them commenced 3.5 years ago, but after a number of case conferences and other proceedings, it is still at the pre-discovery stage.

[6] A security for costs motion requires a risk analysis: what is the likelihood that the Defendant will be entitled to costs and will be unable to recover? On the other side of the coin, the motion also requires an assessment of access to justice: will the Plaintiff be unable to pursue the litigation if required to post security?

[7] The Defendant contends that the Plaintiff has no assets in Ontario. The Plaintiff does not deny that fact; indeed, his position is that he is impecunious. However, the Defendant points out that the Plaintiff tried to make the same point about his financial state in the earlier family law proceedings and was found to be not impecunious.

[8] In his appeal of the family law case to Divisional Court, the Plaintiff was ordered to pay security for costs on the basis of a record that is very similar to the record before me. In Selwyn v. Selwyn, 2021 ONSC 7050, at para 28, Justice Favreau stated:

In my view, Mr. Selwyn has failed to demonstrate that he is impecunious. His affidavit includes general statements and arguments about his financial circumstances. He denies that he has had any successful business ventures in the United Kingdom. He claims that his bank accounts are overdrawn, but only attaches statements from one bank while admitting that he has accounts elsewhere. Other than these general statements, he has provided no specific evidence that makes clear that he is impecunious or that he is unable to raise any funds. For example, his evidence does not include tax returns or any other documents demonstrating that he has no income and no assets with which to satisfy a costs order or that he has no ability to borrow money.

[9] In his record filed in the present motion, the Plaintiff has likewise provided bank statements from one bank in the U.K. but no tax returns or other evidence showing what income and assets he has overall. The record contains his financial disclosure from his 2017 divorce proceedings, and an update from a credit rating agency. That update says that the Plaintiff’s credit rating is “good” and that he has not borrowed any money. That does not suggest the kind of impecuniousness that the Plaintiff pleads.

[10] I also note that the Plaintiff has attempted to file two new affidavits after all cross-examinations were complete. There is no explanation for this late filing of affidavits that have not been tested by cross-examination. Counsel for the Defendant submits that these late affidavits are inadmissible.

[11] The Plaintiff’s response is to point out that the Evidence Act permits affidavits to be sworn by a commissioner for oaths in another jurisdiction like the U.K. That, of course, may be accurate, but it is not responsive to the Defendant’s point. He also states that he is trying to cure the misunderstanding that he says Justice Favreau suffered from in her reading of his bank statements, which he observes may have confused her because they were foreign and therefore unfamiliar to a Canadian. He has therefore supplemented the record with two new affidavits.

[12] In my view, Justice Favreau did not misunderstand the Plaintiff’s bank statements. They were from Barclays Bank, were in English, and were presented in a way that would be clear and comprehensible to anyone familiar with bank statements. Justice Favreau’s understanding of them did not need “correcting”. And in any case, nothing that the Plaintiff argues here explains why he did not submit the two new affidavits with his responding materials so that the deponents could be cross-examined. In splitting his case in this way, he has effectively shielded the affiants from cross-examination.

[13] On the basis of the record before, I have no reason to believe that the Plaintiff is truly impecunious. His former spouse does not appear to have believed that, and neither did the family court or the Divisional Court. The Plaintiff highlights in argument the fact that in issuing the present claim he was granted a fee waiver by the Superior Court office, claiming that this proves he is impecunious. With all due respect, however, the fee waiver does not constitute proof. It is my understanding that the court’s intake desk staff grant those waivers based on a plaintiff’s word for it that he or she has no money to pay the fee, with no proof required.

[14] Nothing in the present record, which is made up primarily of redacted screen shots of a single Barclays account and vague statements about his financial state, has increased the credibility of that claim. There is nothing which would shed light on his total assets and liabilities.

[15] Moreover, given the nature of the Plaintiff’s claim – a solicitors’ negligence claim resulting from matters covered in his lengthy and complex family law proceedings in which the Plaintiff was an attentive and well-educated client – the Plaintiff is not in a position to establish that he has a good chance of success. Although he has spent considerable effort at the hearing explaining his claim step-by-step, it seems to me that the Plaintiff will have an uphill battle proving that the Defendant did not adequately advise him or that he was somehow ill-served by that firm.

[16] The Plaintiff’s primary claim is that the Defendant failed to obtain a certificate of pending litigation on an investment property he was dealing with. It is evident from he Plaintiff’s narration of the events that he was deeply immersed in the transaction and the way in which it was being handled by the Defendant. He was obviously well versed in the transactions he describes and is perfectly capable of understanding them. The record shows that he involved in instructing his lawyers at every stage.

[17] I hasten to add, however, that at this stage my comments on the strength of the Plaintiff’s claim are only an initial impression. They do not amount to a finding of any kind. That will have to wait until a hearing of the Plaintiff’s claim on its merits, either in the context of a summary judgment motion or a trial.

[18] I will also add that although the action began over 3 years ago, the delay does not appear to have prejudiced the Plaintiff. He knows what he is doing as a litigant, has engaged in procedures that show an adroit sense of civil process, and has not been lulled into a sense of reliance on the Defendant one way or another.

[19] The Defendant has already incurred over $46,000 in legal fees defending the action and there is no end yet in sight. Defendant’s counsel submits that the Plaintiff has a tendency to make every proceeding more complicated and protracted than necessary by challenging every move, a tendency which he has also exhibited in the matter before me.

[20] Defendant’s counsel has produced a projected Bill of Costs which estimates costs up to the eve of trial in the all-inclusive amount of $89,303.90. This includes defending against a motion for summary judgment that the Plaintiff has brought. While the overall amount seems somewhat high, I view it as a realistic estimate based on the Defendant’s experience with the Plaintiff in litigation.

[21] Using round numbers for convenience, the Plaintiff shall pay into court $85,000.00 as security for costs of this action up to the start of trial, but not including the trial itself.

[22] In its Notice of Motion, the Defendant seeks costs of this motion. While the Defendant has been successful here, I do not consider it just to impose costs on the Plaintiff for attempting to resist this motion; he did not do anything to bring this on, except to move back to the U.K. And one cannot blame a litigant for attempting to fend off an effort to have him secure costs that have not yet, and may never be, imposed. There will be no costs of the present motion.

Date: May 9, 2023 Morgan J.