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Monday Morning Case Bites for October 21, 2019

Last Week’s Court Rulings from the Alberta Court of Queen’s Bench, Court of Appeal and SCC.

Edited by Amanda Kostek & Christie Dewar

Bidell Equipment v Caliber Midstream, 2019 ABCA 387
Security for Costs | Judgment Pending Appeal

Romspen Investment Corporation v Stephenson, 2019 ABQB 798
Stay Execution of Judgment | Appeal in another Jurisdiction

Bidell Equipment v Caliber Midstream, 2019 ABCA 387

This was a partially successful application for security for costs. The Plaintiff was successful at trial, and the application was for both security for costs for the appeal, and security for judgment pending appeal where on the face of it, the appeal was not frivolous.

The Court directed that security for judgment was an exceptional remedy:

[5]               Security for judgment pending appeal is an extraordinary remedy that will only be granted in exceptional circumstances, as enforcement proceedings are the preferred way for judgments to be enforced: Vaillancourt v Carter, 2017 ABCA 282 (CanLII) at paras 20 – 24. Such an order may be appropriate where the court is concerned that a defendant has or will likely engage in improper conduct with the intention of shielding their assets. There is no indication that is the case here.

Although the Appellant did not appear to have assets within the jurisdiction, the Court was not prepared to grant the application:

[6]               The applicant has demonstrated that Caliber does not appear to have assets in the jurisdiction and that some of the issues raised on Caliber’s appeal may be reviewed on a deferential standard. The appeal, however, does not appear to be frivolous. Collectively, these circumstances are not sufficient to require security for the full judgment amount to be posted for Caliber to be entitled to pursue its appeal.

[7]               Bidell submits that Caliber should be required to post security for the amount of the judgment because of the nature of the submissions it is advancing in Colorado – that Caliber was deprived of due process in Alberta. I am not satisfied that it would be appropriate to require Caliber to effectively abandon either of those arguments in Colorado or its appeal in Alberta. Bidell acknowledges that would be the practical effect of the order it seeks.

The Application also considered security for costs for the appeal.  The Court noted that security for costs is discretionary based on the following factors:

[9]               Security for costs pending an appeal may be ordered pursuant to Rules 14.67(1) and 4.22 of the Rules of Court where the court considers it just and reasonable to do so, taking into account all of the following:

(a)   whether it is likely the applicant for the order will be able to enforce an order or judgment against assets in Alberta;

(b)   the ability of the respondent to the application to pay the costs award;

(c)   the merits of the appeal;

(d)   whether an order to give security would unduly prejudice the respondent’s ability to continue the appeal; and

(e)   any other matter the Court considers appropriate.

The Court granted the application for security for costs on the following basis:

[11]           The test on an application for security for costs of the appeal differs from the test for security for the entire judgment. I am satisfied that it would be unlikely that Bidell would be able to enforce a costs judgment against assets in Alberta if it was successful on the appeal. Caliber is a large United States-based commercial entity that would be able to pay a costs award (subject to the result of the current proceedings to oppose enforcement of the judgment in Colorado).  It would not be unduly prejudiced by the requirement to post security for the costs of the appeal.  The appeal is not frivolous. In all the circumstances, security for costs is appropriate. The applicant’s officer deposes that counsel gives a conservative estimate of the solicitor and client costs of the appeal as $150,000. That estimate has not been challenged.

[12]           Bidell’s application to require security for costs of the appeal is granted. Caliber shall post security for the costs of the appeal with this court, or in such other fashion as may be agreed between the parties, within 30 days, failing which its appeal shall be struck without further order.

Romspen Investment Corporation v Stephenson, 2019 ABQB 798

This was a successful application to stay the execution of a Judgment pending Appeal by another Court in another Jurisdiction. The application was made pursuant to Section 17 of the Judicature Act and the Rules of Court. The Court affirmed that the test is similar to the test for an injunction:

[17]           The test for a stay is the familiar three-part test for interlocutory injunctions. However, in McCabe, Johnstone J said:

[5] In Blacklaws v. Morrow (April 7, 1998) Edmonton 17612 (Alta.C.A.), O’Leary, J.A. addresses this issue (paragraph 6):

In Fulton Ins. Agencies Ltd. v. Purdy (1990), 1990 CanLII 2357 (NS CA), 100 N.S.R. (2d) 341, 272 A.P.R. 341 (C.A.), Hallett, J.A. considered the circumstances in which a judge may exercise his or her discretion to stay execution of a money judgment pending disposition of an appeal. After examining a number of authorities, he proposed two alternative tests, the first requiring satisfaction of criteria essentially the same as for an interlocutory injunction. If that test cannot be met, a stay may nevertheless be granted where there are exceptional circumstances making it fit and just to stay execution. He concluded at p. 346 that a stay of execution should only be granted if the appellant can either:

(1) satisfy the Court on each of the following: (i) that there is an arguable issue raised on the appeal; (ii) that if the stay is not granted and the appeal is successful, the appellant will have suffered irreparable harm that it is difficult to, or cannot be compensated for by a damage award. This involves not only the theoretical consideration whether the harm is susceptible of being compensated in damages but also whether if the successful party at trial has executed on the appellant’s property, whether or not the appellant if successful on appeal will be able to collect, and (iii) that the appellant will suffer greater harm if the stay is not granted than the respondent would suffer if the stay is granted; the so-called balance of convenience or:

(2) failing to meet the primary test [as above], satisfy the Court that there are exceptional circumstances that would make it fit and just that the stay be granted in the case.

These alternative tests were adopted by Chipman, J.A. in Austin v. Habitat Dev. Ltd. et al., 297 A.P.R. 290 at p. 291 (N.S.C.A.).

In Jager Industries Inc. v. Leduc, (Edmonton App. No. 9703-0293-AC, Sept. 4, 1997), Côté, J.A. expressed doubt that the test for the stay of a money judgment pending appeal is like that for an interlocutory injunction, and said “[t]he traditional test in money cases makes the applicant (appellant) prove a special need for a stay, usually by showing that if the judgment were paid, the respondent would likely have trouble repaying”, citing Edmonton (City) v. Westinghouse Can. (1996), 1996 ABCA 278 (CanLII), 42 Alta. L.R. (3d) 356 (C.A.), Wilkinson v. T-Eaton Co., [1992] A.U.D. 1397 (C.A.) and Acheson v. Dory (1993), 149 A.R. 71.

The Court ultimately concluded that the “irrevocable loss of the right to redeem” land in question satisfied the test, but the Court ordered that the stay was limited to 90 days with leave to reapply.