SONG v 2083878 ALBERTA LTD, 2023 ABKB 166


4.22: Considerations for security for costs order
7.3: Summary Judgment (Application and decision)

Case Summary

The Court dismissed the Defendants’ Application for Summary Dismissal of the Plaintiff’s Statement of Claim, and the Defendants’ Application for Summary Judgment of the Defendants’ Counterclaim, and the Defendants’ Application for an Order requiring the Plaintiff to post Security for Costs.

The Court stated that the test for Summary Judgment or Summary Dismissal is whether there is a genuine issue for Trial. Relying on the principles relating to Summary Judgment set out in Weir-Jones Technical Services Incorporated v Purolator Courier Ltd., 2019 ABCA 49, Feasby J. held that there was a genuine issue for Trial and dismissed the Defendants’ Application for Summary Dismissal.

Feasby J. held that although the Plaintiff did not file Affidavit evidence in opposition to the Defendants’ Applications, the Defendants failed to show that the Plaintiff’s claim had no merit.

With respect to the Summary Judgment Application, Feasby J. held that given that he had found that the Plaintiff’s claim raised a genuine issue for Trial, he must also conclude that there was a genuine issue for Trial with respect to the Counterclaim.

Turning to the Security for Costs issue, Feasby J. cited Attila Dogan Construction v AMEC Americas Limited, 2011 ABQB 175 for the proposition that determining whether to grant an Order for Security for Costs involves two steps: First, the criteria in Rule 4.22 must be considered. Second, the Court must ask whether it is just and reasonable to grant an Application for Security for Costs. Feasby J. further cited 1251165 Alberta Ltd. v Wells Fargo Equipment Company Ltd., 2013 ABQB 533 for the following general principles: (1) The existence of a Counterclaim is a factor to be weighed based on the extent to which the Counterclaim is tied to the claim, or whether it involves mainly different issues from the claim; (2) The Court must attempt to look at the merits of the Action, as difficult as that may be on an interlocutory Application; (3) The greater the likelihood of success for the Plaintiff (if that can be reasonably assessed) the more the Court should consider the potential unjustness of preventing a meritorious claim from proceeding; (4) The converse is true: the smaller the likelihood of success for the Plaintiff (if that can be reasonably assessed) the slower the Court should be in denying security when security would otherwise be appropriate; and (5) Any connection between the Plaintiff’s financial situation and the Defendant’s conduct is relevant, especially if the Defendant’s wrongful conduct is alleged to be the cause of the Plaintiff’s impecuniosity.

Having found that the Plaintiff’s dire financial circumstances were attributable to the Defendants’ breaches that were in issue in this proceeding, the Plaintiff appeared to have a reasonable claim against the Defendants and a reasonable position in resisting the Counterclaim, and that the Counterclaim was inextricably linked with the Statement of Claim, Feasby J. concluded that no Security for Costs should be ordered.

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