4.22: Considerations for security for costs order

Case Summary

The Appellant sued his sister over their mother’s Estate. The sister asked the Court to summarily dismiss the suit. In the alternative, she sought Security for Costs. The Master did not dismiss the suit, but held that because the “chances of succeeding in this are so remote” the Appellant should post Security for Costs.

After the Security was not posted, the Master ordered the Appellant’s Caveat discharged ex parte. The Appellant did not Appeal in time, but later moved to extend the time to Appeal. The presiding Justice determined that the test for extending time to Appeal was not met, primarily because the proposed Appeal appeared to have no merit. The Appellant then appealed the Judge’s Decision to the Court of Appeal.

The Court of Appeal unanimously agreed that there was no legitimate ground on which the Court could upset the Decision of the Chambers Judge. Citing Rule 4.22, the Court stated that the Appellant was not living in Alberta and gave no evidence of assets in Alberta. Further, the Court stated that Rule 4.22:

…expressly provides that whether to order security for costs is discretionary. The chambers judge plainly decided that this was a fit case for it, as he found that the appeal from the Master and resisting security for costs here lack “any reasonable chance of success” and “would be doomed to fail in any event.” The standard of review on appeal from a discretionary decision is well settled: it is deferential.

The Court also discussed the practice of ordering Security for Costs in situations where there is only barely enough doubt to not dismiss the Claim summarily:

In the case of “near misses” in summary judgment (or summary dismissal) motions, [ordering security for costs] is a very wholesome practice. Many decisions of the Court of Queen’s Bench can be found giving or withholding summary judgment on terms such as security.

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