4.22: Considerations for security for costs order
14.67: Security for costs
14.68: No stay of enforcement

Case Summary

The Applicant (“HML”) previously secured Summary Judgment against the Respondent (“Pinder”), and Pinder appealed. The Applicant then applied for an Order for Security for Costs on Appeal and Security for Judgment.

The Court emphasized that Security for Judgment is an extraordinary remedy that is granted only in exceptional circumstances. Instead, Courts typically encourage the use of enforcement proceedings under the Civil Enforcement Act, RSA 2000, c C-16 given that an Appeal does not operate as a stay of enforcement in Alberta pursuant to Rule 14.68. In this case, evidence that Mr. Pinder sold a $9,000 piece of equipment still subject to HML’s security interest, coupled with acrimonious receivership proceedings, did not rise to the level needed to grant the remedy of Security for Judgment.

In granting a portion of the Security for Costs however, the Court reviewed Rules 14.67 and 4.22. Rule 14.67 permits a single Appeal Judge to order security for payment of Costs. If the security is not provided as ordered, the Appeal is deemed to have been abandoned and the other party is entitled to a Costs Award. Rule 4.22 outlines the factors to be considered in determining whether an order for Security for Costs is just and reasonable, including the ability of the Respondent to pay the Costs Award and any other matter the Court considers appropriate. Here, the Court found that Mr. Pinder resided in British Columbia, had nominal assets of less than $2,500, shares in two active corporations valued at $0, and no source of income aside from the Canada Emergency Relief Benefit. This evidence, coupled with the fact Mr. Pinder failed to pay any portion of the Judgment or Costs to date, was deemed by Justice Pentelechuk sufficient to demonstrate concern with Mr. Pinder’s ability to pay future Costs in the event his Appeal is unsuccessful. As a result, the Court granted the Application for Security for Costs.

Finally, the Court noted that the Applicant provided no breakdown or particulars of the requested $50,000 in security, and in turn, granted Security for Costs in the amount of $25,000, assuming an average hourly rate of $500 and 50 hours of legal work on the Appeal. 

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