Tag: Security for Costs Motions
Motions for security for costs are means of ensuring that there is a sum in place to pay the defendant’s costs, should the defendant be entitled to costs. It is not a motion that is often brought, but it is typically considered when the plaintiff is not a resident of Ontario and there is concern that his or her case may not have merit.
Rules 56 and 61.06 of the Rules of Civil Procedure govern motions for security for costs. The test for obtaining security for costs is two-fold:
- The defendant must show that the plaintiff’s action or application fits into one of the categories specified in subrule 56.01(1) which include the following:
(a) the plaintiff or applicant is ordinarily resident outside Ontario;
(b) the plaintiff or applicant has another proceeding for the same relief pending in Ontario or elsewhere;
(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;
(d) the plaintiff or applicant is a corporation or a nominal plaintiff or applicant, and there is good reason to believe that the plaintiff or applicant has insufficient assets in Ontario to pay the costs of the defendant or respondent;
(e) there is good reason to believe that the action or application is frivolous and vexatious and that the plaintiff or applicant has insufficient assets in Ontario to pay the costs of the defendant or respondent; or
(f) a statute entitles the defendant or respondent to security for costs.
- If the plaintiff’s action or application does fit into one of the above-noted categories, the plaintiff has the option of attempting to prove that it would be unjust to order security, because they are impecunious, and the claim has merit.
An interesting consideration in the context of estate litigation that needs to be addressed is the fact that the party commencing a proceeding is not always the “plaintiff” or “applicant”, as defined by Rule 56. For example, a party may be propounding a Will in response to a Notice of Objection in which case although the propounder is technically the Applicant, the claim is made by the Objector. This issue has been considered by the Courts:
- In Vout v Hay  2 SCR 876, Justice Sopinka commented on this issue allowing the Court, on a motion for security for costs, to cast the challenger as the real “plaintiff” such that the propounder could indeed move for security for costs.
- In Boutzios Estate, Re (2004), 5 ETR (3d) 51 (Ont SCJ), Justice Greer, exercised her discretion under section 131 of the Courts of Justice Act, to order for security for costs and did not address the question of who had the burden of proof and rebuttable presumptions, as section 131 allows the Court to award the costs of and incidental to a proceeding or a step in a proceeding against any party at any time.
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Find this blog interesting? Consider these other related posts:
During Hull on Estates Episode 34, we discussed Security for Costs Motions in the context of Estate Litigation including the cases of:
- Re Bisyk (1979), 23 O.R. (2d) 600;
- Moses Estate, Re (2001), 38 E.T.R. (2d) 231 (Manitoba Master);
- Boutzios Estate, Re (2004), 5 E.T.R. (3d) 51 (Ont. S.C.J.); and
- the changing landscape of the law in respect of Security for Costs Motions.