Snagg et al. v. Makhoul, 2024 ONSC 3735

This is a personal injury action arising from a motor vehicle accident involving a young pedestrian. The defendant brought a motion seeking an Order compelling the plaintiffs to answer refusals arising from a cross-examination of their lawyer. At its crux, the motion concerned whether the plaintiffs had to disclose and produce any applicable adverse costs insurance that could satisfy any part of a costs judgment against the plaintiffs in the action. The plaintiffs’ law firm admitted that it had an adverse costs policy with the law firm as a named insured, and that the policy applied to the plaintiffs.

Justice Roger held that the policy must be disclosed. Justice Roger applied rules 30.02(2) and 31.06(4), noting that these rules apply to any insurance policy under which an insurer may be liable to satisfy all or part of a judgment in the action, or to indemnify or reimburse a party for money paid in satisfaction of all or part of a judgment. These rules are not limited to policies of insurance in the name of a party or over which a party has possession, control, or power. If a claim of privilege were successfully established for any part of the policy, the rest of the policy would still need to be disclosed.

Dorah v Dyal, 2023 ONSC 2908

Following a four-week MVA jury trial, the plaintiffs were awarded $652,521 in damages by the jury. The plaintiffs recovered only $191,228.65 after application of statutory deductibles. The plaintiffs claimed costs and disbursements totaling $461,844.66. The defendant claimed costs totaling $178,803.71.

One month before trial, the defendant had made an offer to settle for $250,000. The plaintiffs argued that the Rule 49 Offer – which was made as a single lump offer between the two plaintiffs – should not attract cost consequences because it was not specific enough to each plaintiff and was not severable between them. Justice Koehnen disagreed, holding that a Rule 49 offer in this format is acceptable where one of the plaintiffs is an FLA claimant, and the plaintiffs are a family unit. Accordingly, the offer attracted Rule 49.10 costs consequences. Justice Koehnen awarded the plaintiffs costs up to the date of the offer, and awarded the defendant costs from the date of the offer onwards. This resulted in a net costs payment of $21,923.17 to the plaintiffs.

Jerry et. al. v. Black et. al, 2023 ONSC 603 (Div. Ct.)

This personal injury action arises from a motor vehicle accident. The defendants arranged for the primary plaintiff to be assessed by a neuropsychologist. Counsel for the parties exchanged correspondence confirming: the date for the 6.5 hour appointment; the plaintiff’s agreement to attend; and that a missed appointment fee would be charged if he failed to attend. The amount of the missed appointment fee was not discussed. The plaintiff did not attend the appointment and the neuropsychologist charged a missed appointment fee of $1,695. The defendants sought reimbursement of the fee, and the plaintiffs refused to pay. The defendants brought an unsuccessful motion for reimbursement in which the motion judge accepted the plaintiffs’ argument that the court did not have jurisdiction to make the order sought, and dismissed the motion.

The defendants obtained leave to appeal, and on appeal the Divisional Court allowed the appeal and ordered the plaintiffs to pay the missed appointment fee. In its reasons the Divisional Court confirmed that the Superior Court has jurisdiction to order that a party pay the costs of an independent medical examination that they failed to attend even in the absence of a court order for the examination.

Antony v. Kumarasamy, 2022 ONSC 6619

Less than a month before a scheduled trial, the plaintiff in an MVA personal injury action accepted an offer to settle from the statutory third party for $85,000 plus interest, disbursements, and costs to be agreed upon or assessed. The parties were unable to agree on costs and the plaintiff brought a motion for a determination by the court. One issue was whether the plaintiff was entitled to recover costs associated with two AB arbitrations and a CPP dispute. Justice Ramsay held that neither the AB nor the CPP costs were recoverable. While costs could be recovered for AB-related arbitrations, the plaintiff failed to provide evidence supporting any of the factors set out by the Court of Appeal in Cadieux. Justice Ramsay also found that the recovery of more than $1 million in SABS interest was a factor weighing against requiring the statutory third party in the MVA tort action to pay for AB-related costs.

With respect to the CPP dispute, Justice Ramsay held that CPP litigation costs are not recoverable in a MVA tort action because the Insurance Act does not impose any statutory requirement on the plaintiff to apply for or dispute CPP benefits.

Tryon v. Packham, 2022 ONSC 7210

This personal injury MVA action was dismissed by a jury following a 13 day trial. The jury concluded that the defendant was not negligent despite having rear ended the plaintiff. The jury accepted that the accident was caused due to the defendant’s sudden seizure. The jury further held that it was reasonable for the defendant to have been driving, and that he had no reason to anticipate the onset of the seizure. The defendant was awarded costs in the full amount sought: $140,109.10 inclusive of HST. In its analysis, the Court considered the factors under Rule 57 and accepted the defendant’s submissions in that regard.

Ozimkowski v. Raymond, 2022 ONSC 51

This action arising from a motor vehicle accident settled in the month before the scheduled trial for $300,000 inclusive of pre-judgment interest, plus disbursements of $52,678, and costs. The parties could not agree on the amount to be paid for costs. The defendant argued that the commonly used 15-10-10 guideline should apply, which would equate to costs of $35,000. The plaintiff argued for partial indemnity (60%) of docketed fees, which would equate to a total of $97,749 at the partial indemnity reduction. Justice Hackland awarded the plaintiff fees of $65,000 plus HST. Justice Hackland held that it was appropriate to depart from the usual 15-10-10 guideline given the proximity to trial, and in consideration that there had been a mandatory mediation, four case conferences, and three discoveries of the plaintiff.

Davies v. The Corporation of the Municipality of Clarington, 2021 ONSC 6449

After a trial lasting more than 140 days in this class action, the defendants were successful in beating their offers to settle, and as a result they obtained a costs award that totaled in excess of $3.4 million. The plaintiff resided in Poland and was impecunious. During the course of the litigation he received advances from four different litigation loan providers. It was estimated that the outstanding loans had an accrued principal and interest owing in excess of $6 million. The defendants, believing they would not recover against the plaintiff, sought to recover their costs award against the litigation loan providers since their loans allowed the litigation to proceed and may have prevented settlement due to high interest rates. Justice Edwards declined to make any award against the non-party litigation providers in this case, but acknowledged that litigation loan providers may be liable for
costs awards in proper circumstances.

Justice Edwards directed that loan documentation must be listed in a plaintiff’s Schedule B. By listing it there, the defendant is put on notice of a potential claim on the loan interest if the plaintiff is awarded costs at trial. In certain cases (such as personal injury actions) if a defendant refuses an advance payment to the plaintiff, the defendant is more likely to become liable for interest on the plaintiff’s litigation loan as a disbursement. Second, the defendant should put the loan provider on notice that they may become responsible for costs as soon as possible. In the present case, the defendants did not provide notice to the loan providers until after trial despite knowing of the loans for years prior.

Brewer v. Canada Corp No. 343827-9, 2021 ONSC 5428

In Brewer v. Canada Corp No. 343827-9, Justice Bell of the Superior Court of Justice considered the merits of a motion for security for costs as a result of a Plaintiff being a resident outside of Ontario. Justice Bell ultimately decided that the Plaintiff was required to post security and that they shall not take any further steps in the action until the specified amount was posted and proof was provided to Defendants’ counsel.


The Plaintiff, Ms. Brewer, alleged that she was injured while dining at the 360 Restaurant in the CN Tower in Toronto, Ontario. The Plaintiff alleged that when she turned around to speak to another guest, her foot hit “the uneven and rotating floor” and as a result, she fell, hitting her head.

The Plaintiff commenced her action in August of 2018. In September of 2018, the Defendants put Ms. Brewer on notice that they considered her claim unmeritorious and that they intended to seek an order for security for costs on the basis that she lived in Florida and was therefore an out-of-province resident.

The Defendants continued to reiterate their concern regarding recovering the costs of their litigation and requested that Ms. Brewer post $35,000.00 as security towards the costs of the action. The Plaintiff failed to respond to this request until April of 2020.

Plaintiff’s counsel advised the Defendants that Ms. Brewer was impecunious and could not afford to post the $35,000.00. Counsel for the Defendants requested records in support of the impecuniosity claim in order to move forward with scheduling examinations for discovery. The records were not produced by Ms. Brewer and the Defendants maintained their position with respect to scheduling examinations for discovery given that the security for costs issue was still pending.

In March of 2021, Ms. Brewer served the Defendants with a notice of examination requiring their attendance on August 11, 2021. The Defendants then brought their motion for security for costs.


Rule 56.01 (1)(a) of the Rules of Civil Procedure provides that the court, on motion by the Defendant, may make such order for security for costs as is just where it appears that the Plaintiff is ordinarily a resident outside of Ontario.

It is important to note that Rule 56.01 (1) does not create a prima facie right to security for costs. The rule triggers an inquiry in which the court, using its broad discretion, considers multiple factors to make such order as is just in the circumstances, taking into account the merits of the claim, the financial circumstances of the Plaintiff, and the possibility of an order for security for costs preventing the claim from proceeding.

The Court of Appeal in Yaiguaje v. Chevron Corp, 2017 ONCA 827 analyzed Rule 56, stating that an order for security for costs should only be made where the justness of the case demands it. The court must consider the justness of the order holistically, examining all circumstances of the case and considering the overriding interest of justice to determine whether or not it is just for the order to be made.

The initial onus is on the Defendant to show that the Plaintiff falls within one of the enumerated categories of Rule 56.01. Once the Defendant meets the initial onus, the Plaintiff can rebut the onus and avoid security for costs by showing that they have sufficient assets in Ontario or a reciprocating jurisdiction to satisfy the costs order, the order is unjust or unnecessary, or the plaintiff should be permitted to continue with the action despite their impecuniosity.

Because the Plaintiff is ordinarily a resident in Florida, the Defendants met their initial onus that the Plaintiff falls under Rule 56.01 (1)(a). The issue that Justice Bell needed to consider was whether it was just to order the security for costs.

Justice Bell first considered whether the Plaintiff was impecunious. After a review of Ms. Brewer’s assets versus her debts, Justice Bell concluded that her assets exceeded her debts by approximately $106,000.00. As Justice Perell stated in Montrose Hammond & Co. v. CIBC World Markets Inc., 2012 ONSC 4869, “a litigant who relies on impecuniosity bears the onus of proof on this point and must do more than adduce some evidence of impecuniosity and must satisfy the court that it is genuinely impecunious with full and frank disclosure of its financial circumstances.” A security for costs motion requires a rigorous standard of financial disclosure and Justice Bell concluded that the Plaintiff’s financial disclosure did not meeting the “robust particularity” standard. There were inconsistencies between the Plaintiff’s sworn statement and the 2019 statement of income and the Plaintiff failed to provide medical evidence to demonstrate her inability to return to work.

With respect to the merits of the claim, Justice Bell stated that it is a relevant consideration in a motion for security for costs. If a Plaintiff demonstrates impecuniosity, they can resist the motion by showing that the claim is not plainly devoid of merit. If impecuniosity if not established, closer scrutiny is warranted, and the relevant question becomes whether a plaintiff has demonstrated a good chance of success. Justice Bell declined to comment on the merits of the claim as the evidence filed on the motion was insufficient and the examinations for discovery had not been conducted.

Finally, with respect to the justness of the security for costs order, Justice Bell reiterated that the court must take a holistic approach. The Plaintiff argued that her impecuniosity was directly linked to the accident at the Defendants’ premises and that the Defendants were now attempting to use her financial circumstances against her to prevent the matter from continuing. The record, however, did not support Ms. Brewer’s argument that the motion was a defence litigation tactic to prevent her from continuing her case. The Defendants gave notice at the outset of the litigation of their intention to seek security for costs and the Plaintiff ignored their repeated requests for supporting documentation.

After considering all relevant factors, Justice Bell concluded that it was just in the circumstances that the Plaintiff be required to post security for costs in an amount that included costs incurred by the Defendants to date (not including the subject motion) and costs projected to be incurred up to and including documentary discovery and examinations for discovery. Justice Bell ordered that the plaintiff post security in the amount of $17,000.00 within 60 days of the release of the endorsement.

Diperri v. The Wawanesa Mutual Insurance Company, 2021 ONSC 4680

In Diperri v. The Wawanesa Mutual Insurance Company, Justice Myers of the Ontario Superior Court stayed the action and required the plaintiffs to advance their claim by way of appraisal under s.128 of the Insurance Act RSO 1990, c I.8.


The plaintiff’s home suffered a water loss on July 8, 2013. The defendant, Wawanesa Mutual Insurance Company, insured the plaintiffs for losses to their goods as a result of the flood.

During the restoration, the plaintiffs allege that various items went missing from their home and/or storage. As a result, the plaintiffs sued their insurer in tort and bailment.

The plaintiff’s insurance policy with the defendant is subject to Statutory Condition 11 under the Insurance Act that requires parties to resolve specified disputes by appraisal under s.128 of the statute. Statutory Condition 11 states the following:


11. In the event of disagreement as to the value of the property insured, the property saved or the amount of the loss, those questions shall be determined by appraisal as provided under the Insurance Act before there can be any recovery under this contract whether the right to recover on the contract is disputed or not, and independently of all other questions. There shall be no right to an appraisal until a specific demand therefor is made in writing and until after proof of loss has been delivered.

The plaintiffs filed for a proof of loss and the parties then used an appraisal to value some of the plaintiffs’ damaged goods. The plaintiffs also claim that a significant amount of their goods were never returned and sue for this loss as well.

In the statement of claim, the plaintiffs seek $226,000.00 for the damaged and lost goods, as well as other claims with respect to their recovery against the defendant, including aggravated and punitive damages. The claim was made against Wawanesa Mutual Insurance Company, but did not include the adjuster or the company who stored the plaintiffs’ goods. The plaintiffs conclude that their insurer is liable for the sub-bailment or negligent conduct of its sub-bailors, bailee, and contractor.

In an initial appraisal, the umpire stated that it will be up to the plaintiffs to decide whether or not they want to pursue action against any responsible party, including Wawanesa Mutual Insurance Company. Wawanesa Mutual Insurance Company will then advise if they wish to have the appraisal hearing reconvened.

The insurer has attempted to initiate the remainder of the appraisal hearing, but the plaintiffs have claimed that they are not seeking payment under their insurance policy but are instead claiming damages through independent causes of action that are not subject to the appraisal remedy.


Quoting Bnei Akiva School v. Sovereign Insurance Co., 2016 ONSC 383 and 2343697 Ontario Inv. v. Aviva Insurance Company of Canada, 2019 ONSC 3106, Justice Myers stated that an appraisal will be required to value disagreements of the type set out in Statutory Condition 11 even where there are other issues between the parties in litigation.

There isn’t any case law that directly covers the issues in question, but Verlysdonk v. Premier Petrenas Construction Co. Ltd. et al., 1987 CanLII 4217 states that an appraisal to value insured loss does not prevent or preclude the insured from suing in tort the third part who caused the loss. Justice Myers stated that as long as the plaintiffs’ rights to bring a claim for any heads of damages not covered by the appraisal remain intact, the plaintiffs will not be prejudiced by having to resolve the valuation of the lost goods in a quick and affordable manner.

Justice Myers stated that the issue comes down to the interpretation of Statutory Condition 11. Statutory Condition 11 provides for an appraisal to be help when “there is disagreement concerning the value of the property insured, the property saved or the amount of loss.” The missing and damages goods from the plaintiffs’ home were property insured as they were property saved from the effects of the water loss. In another sense, damages caused to the plaintiffs’ goods by the insurer or its contractors as part of the process of determining and mitigating the plaintiffs’ insured loss is an amount of the loss.

Further, the initial appraisal umpire believed that this was a matter that could be dealt with under the process that had already commenced. The umpire stated that Wawanesa Mutual Insurance Company could unilaterally reconvene the appraisal hearing to process and deal with the losses. Therefore, Justice Myers concluded that the claim against Wawanesa Mutual Insurance Company for losses caused to the plaintiffs’ property removed from the house to allow the insured restoration to begin falls within the language of Statutory Condition 11.

Justice Myers granted the insurer’s motion and held that the claim was subject to appraisal under s.128 of the Insurance Act. Justice Myers stayed the action until completion of the appraisal and held that the Statutory Conditions controlled the result. The plaintiffs were ordered to pay the defendant its costs on a partial indemnity basis fixed at $3,000.00.

Noori v. Liu, 2021 ONSC 3445

This action arose from a motor vehicle accident. The defendants admitted liability, and at the 22-day jury trial on damages the jury awarded the primary plaintiff $40,000 in general damages and $0 in special damages. It awarded the FLA plaintiff $0. On the defendants’ threshold motion following trial, the general damages claim was dismissed. Before trial, there were two Rule 49 offers to settle made by the defendants of $35,000 and $77,000.

The defendants sought $275,259.55 in costs. Justice Coats applied of Rules 49 and 57, and the applicable case law, and ordered that the plaintiffs pay the defendants $152,680.93 in costs. Of the $100,000 limit available under the plaintiffs’ adverse costs insurance policy, $82,000 was used by plaintiff’s counsel for disbursements.