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CIVIL PROCEDURE - Costs - Security for costs - Where plaintiff insolvent or impecunious - Appeal costs

Wednesday, November 29, 2017 @ 8:34 AM  

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Application by the plaintiff, Access Mortgage Corporation, for an order requiring the defendant, Arres Capital, to post security for the costs of its appeal. The defendant appealed a bankruptcy order issued against it. The plaintiff was a judgment creditor of the defendant. The plaintiff was owed $1.03 million, and was one of many respondents to the defendant's appeal. The plaintiff sought an order requiring the defendant to post security for costs of its appeal in the amount of $14,750. The plaintiff relied on evidence that the defendant was a judgment creditor owing $220,000 for the previous four years in another matter.

HELD: Application allowed. Rules 4.22 and 14.67 of the new Alberta Rules of Court did not require special circumstances as a precondition to an order for security for costs. Pre-September 2014 decisions of the appeal court that referenced tests involving special circumstances in the context of security for costs, had effectively been overtaken by Rules of Court. Given that Rule 4.22(e) enabled the court to consider "any other matter" it considered appropriate, if a party thought that there were special circumstances, they could be considered under the catchall Rule 4.22(e), where appropriate. In the case at hand, the defendant had no exigible assets, as they were subject to a receiver's charge and in the possession and control of the receiver. Total cash held by the receiver was $60,877. In the event the defendant's appeal was dismissed, it was unlikely the plaintiff would be able to enforce its judgment or recover costs. The fact that the defendant was still involved in Court of Queen's Bench proceedings suggested it would be able to continue its appeal after posting security. The defendant was thus ordered to post $14,750 as security for costs within 30 days.

Access Mortgage Corp. (2004) v. Arres Capital Inc., [2017] A.J. No. 1200, Alberta Court of Appeal, P.A. Rowbotham J.A., November 14, 2017. Digest No. TLD-November272017006