The defendant brought a motion for an order requiring the plaintiff, a corporate entity, to post security for costs under Rule 56.01(1)(d), alleging insufficient assets in Ontario.
The court found that the plaintiff, a sole-purpose corporation that had sold its only asset, indeed had insufficient assets.
The plaintiff failed to meet the high evidentiary threshold for demonstrating impecuniosity, as it did not provide robust financial disclosure regarding its principal's personal assets or borrowing ability.
As impecuniosity was not established, the plaintiff was required to show a good chance of success at trial; however, the court found the merits to be neutral due to significant credibility issues and a potential limitations defence.
The court also dismissed the plaintiff's argument of delay in bringing the motion, finding no prejudice.
Consequently, the motion for security for costs was granted, with the plaintiff ordered to post security in several installments for past and future litigation steps, and to pay the defendant's costs of the motion.
