The Applicants applied for Security for Costs of this Appeal pursuant to Rules 14.67 and 4.22. In the underlying Action, the Respondent/Plaintiffs alleged that the Applicants breached, among other things, a non-disclosure agreement and interfered with economic relations related to the development of new technologies in alternative energy. In 2022, an Applications Judge dismissed the Respondent’s Action against all Defendants (including the Applicants) for long delay under Rule 4.33.

Appeal Justice Friesen began by noting that a Security for Costs Order is discretionary and must balance the reasonable expectations and rights of the parties to achieve a just and reasonable outcome. Like here, a single Appeal Judge may award Security for Costs in accordance with rules 14.67(1) and 4.22. Rule 14.67 permits a single Appeal Judge to order a party to provide Security for Costs pursuant to Part 4, Division 4 of the Rules. Rule 4.22 provides that the Court may order a party to provide Security for Costs if the Court considers it just and reasonable to do so, taking into account a number of factors enumerated within that Rule.

Appeal Justice Friesen found that there was evidence that the Respondents had not paid costs awarded to the Applicants and owed large sums of money to other parties which had not yet been paid. The individual Respondent’s Affidavit attesting to assets in Alberta did not provide details of those assets and did not address whether there were any assets of the corporate Respondent. Further, the Respondents had done little to explain the merits of their Appeal. Finally, the Respondents claimed that their ability to carry on with the Appeal will be prejudiced if they have to give security for payment of a costs award; however, they failed to elaborate on that assertion in Affidavit evidence or otherwise.

Relying on previous decisions of the Court, Friesen J.A. found that the “failure to pay costs awarded following trial court process, combined with a demonstrated inability to pay costs should an appeal be unsuccessful is, in most cases, good reason to grant a security for costs order” and that “concerns regarding a party’s ability to pay costs coupled with modest prospects of an appeal’s success have also been sufficient to justify granting an application for security for costs”. In considering these factors, Friesen J.A. was satisfied that it was appropriate to grant an Order for Security for Costs in favour of the Applicants.