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Family - Appeal - Security for Costs. Hevey v. Hevey
In Hevey v. Hevey (Div Court, 2023) the Divisional Court considered a security for costs motion in a complex family court appeal [FCR R38], which adopts RCP R61.06 security for costs on appeal rules - which further adopts R56 of the RCP (trial security for costs). This messy configuration was further complicated by the involvement of a corporate derivative proceedings between the parties and unpaid past cost orders.
These quotes address which security for costs regime should apply:Applicable law
[10] A preliminary issue is whether the Family Law Rules or the Rules of Civil Procedure apply to this motion.
[11] Rule 38(1) of the Family Law Rules, O Reg 114/99, dealing with appeals to the Divisional Court and Court of Appeal, provides that Rules 61, 62 and 63 of the Rules of Civil Procedure, RRO 1990, Reg 194, apply to appeals to the Divisional Court. This includes Rule 61.06(1) governing security for costs, which states:(1) In an appeal where it appears that,
(a) there is good reason to believe that the appeal is frivolous and vexatious and that the appellant has insufficient assets in Ontario to pay the costs of the appeal;
(b) an order for security for costs could be made against the appellant under rule 56.01; or
(c) for other good reason, security for costs should be ordered,
a judge of the appellate court, on motion by the respondent, may make such order for security for costs of the proceeding and of the appeal as is just. [12] Rule 56.01(1) of the Rules of Civil Procedure provides:(1) The court, on motion by the defendant or respondent in a proceeding, may make such order for security for costs as is just where it appears that,(a) the plaintiff or applicant is ordinarily resident outside Ontario;
(b) the plaintiff or applicant has another proceeding for the same relief pending in Ontario or elsewhere;
(c) the defendant or respondent has an order against the plaintiff or applicant for costs in the same or another proceeding that remain unpaid in whole or in part;
(d) the plaintiff or applicant is a corporation or a nominal plaintiff or applicant, and there is good reason to believe that the plaintiff or applicant has insufficient assets in Ontario to pay the costs of the defendant or respondent;
(e) there is good reason to believe that the action or application is frivolous and vexatious and that the plaintiff or applicant has insufficient assets in Ontario to pay the costs of the defendant or respondent; or
(f) a statute entitles the defendant or respondent to security for costs. [13] However, Rule 38(26) of the Family Law Rules provides for security for costs as well, stating:(26) On a motion by the respondent for security for costs, the court may make an order for security for costs that is just, if it is satisfied that,
(a) there is good reason to believe that the appeal is a waste of time, a nuisance, or an abuse of the court process and that the appellant has insufficient assets in Ontario to pay the costs of the appeal;
(b) an order for security for costs could be made against the appellant under subrule 24 (13); or
(c) for other good reason, security for costs should be ordered. [14] Rule 24(13) of the Family Law Rules provides:(13) A judge may, on motion, make an order for security for costs that is just, based on one or more of the following factors:1. A party habitually resides outside Ontario.
2. A party has an order against the other party for costs that remains unpaid, in the same case or another case.
3. A party is a corporation and there is good reason to believe it does not have enough assets in Ontario to pay costs.
4. There is good reason to believe that the case is a waste of time or a nuisance and that the party does not have enough assets in Ontario to pay costs.
5. A statute entitles the party to security for costs. [15] Counsel in this case both submitted that I should follow the Family Law Rules, despite the general direction in Rule 38(1) of the Family Law Rules to use the Rules of Civil Procedure, as Rule 38(26) specifically deals with security for costs. I am not convinced. Rule 38(4) provides that subrules (5) to (45) “apply to an appeal from an order of the Ontario Court of Justice to the Superior Court of Justice” under certain statutory provisions listed. This proceeding is not an appeal from the Ontario Court of Justice, and those subrules appear to deal with different procedures than are before this Court.
[16] Although, at the end of the day, both schemes set out similar tests, and provide the Court with discretion to make an order that is just in the circumstances, in my view the appropriate rules to follow in this case are those found in the Rules of Civil Procedure.
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