Legal Blog

Security for Costs – Construction

Proxema Ltd. v. Birock Investments Inc. 2016 Ont SCJ

The corporate general had little to gain from the action and was prosecuting it mostly for the benefit of unpaid subcontractors; indeed, it seemed that the subcontractors were funding the litigation. The owner determined at discoveries that the general was not continuing to carry on business and brought the motion based on that information. Further information was forthcoming when the general’s representative was cross-examined on his affidavit in response to the motion. The judge noted that the owner did not need initially to prove that the general had insufficient assets; it only needed to prove that there was good reason to believe that it had insufficient assets. Once that was done, the onus switched to the general. The judge agreed that leave to bring the motion should be given because it was necessary to level the playing field. However, the judge limited the amount of the security to the $50,000 maximum used in payment of security to vacate a lien.

Written by Jonathan Speigel Jonathan Speigel, the founding partner of Speigel Nichols Fox LLP, leads the litigation and construction practices.