Citation: Ellph.com Solutions Inc. v. Aliant Inc., 2011 NSSC 316
Date: 20110808
Docket: Hfx No. 259106
Registry: Halifax
Between:
Ellph.com Solutions Inc. and Ellph.com Technologies
Incorporated Plaintiffs
and
Aliant Inc., Aliant Telecom Inc. and Aliant Telecom Inc./
Telecommunications Aliant Inc. Defendants
LIBRARY HEADING
Judge: The Honourable Justice Gerald R. P. Moir
Heard: June 20, 2011
Subject: Civil procedure, security for costs
Summary: The plaintiffs are closely held, insolvent companies. They claim that the defendants unlawfully terminated a software sublicencing agreement that was to provide revenues to the plaintiffs. The defendants sought an order requiring the plaintiffs to post guarantees from their shareholders securing the contingent liability for costs.
Issues: Whether to grant the order?
Result: The new rules do not alter the broad discretion to do what is just on a motion for security for costs nor the requirement for a circumstantial inquiry on that subject. Emmanuel v. Sampson Enterprises Ltd. remains a sound statement of principles. In the circumstances, the order would be unfair. This is a contracts case, and the parties freely contracted for corporate liability only. The termination is a cause of the insolvency, and the order would end the claim. The shareholders must fund the litigation, and they should not be asked to undertake an additional burden, especially in light of the defendants' estimate of party and party costs in the millions of dollars.
THIS INFORMATION SHEET DOES NOT FORM PART OF THE COURT'S DECISION. QUOTES MUST BE FROM THE DECISION, NOT THIS LIBRARY SHEET.