Ingrid Hayden Plaintiff - v. -, 2017 ABQB 111

Court of Queen’s Bench of Alberta Citation: Hayden v Alberta Health Services (Foothills Medical Centre) , 2017 ABQB 111 Date: 20170215 Docket: 1601 02565 Registry: Calgary Between: Ingrid Hayden Plaintiff - and - Alberta Health Services, operating business at the Foothills Medical Centre in Calgary, Alberta, Ms. Vickie Kaminski, President and CEO of Alberta Health Service, Ms. Tina Giesbrecht, Ms. Laurie Blahitka, Ms. Jo Ann Beckie, Ms. Sara J. Pereira, Dr. Chris Spanswick, Mr. Mark Kent, Mr. Marty Sholtz, Ms. Linda Norton, Ms. Connie Lorraine Burkart. Ms. Suzanne Basiuk, Mr. Dr. W. Becker, Dr. A. Eloff, Dr.

Lori Montgomery S, Mr. Rob Caswell, Ms. Cynthia Cook, Mr. Larry Walter, Mr. Christopher Dunn, Ms. Jaylene MacDonald, Mr. Ryan Dimitriou, Ms. Sara Gallow, Ms. Glenda Thompson, Ms. Stacey Roach, Ms. Brenda Ward, Ms. Katherine McCauley, Mr. Ryan Roche, Ms. Ingrid Martinez, Ms. Jenna Steen, Ms. Laura Nicholson, Mr. Dennis Holliday, Mr. David Silverstone, Ms. Johanne Edwards, Ms. Cathy Edmonds, Ms. Irene O’Callaghan, Ms. Ruth Sutherland, Ms. Dale Gyonor, Ms. Allison Kinney, Ms. Dawn Lake, Ms. Jann Lynn- George, Mr. Steven R. Jewell, Mr. Michael Tolfree, Mr. Derek Wojtas, Mr. Waqar Mughal, Ms. Linda Teskey, Mr.

Matthew Murphy, Alberta Union of Provincial Employees, operating business in Edmonton, Alberta, Mr. Guy Smith, President of Alberta Union of Provincial Employee, Mr. Greg Maruca, Mr. Reynold Morgan, Mr. David Lardner, Ms. Stacey McKenna, Mr. Michael Hughes, Nugent Law Office, operating business in Edmonton. Mr. Patrick Nugent, Erin Ludwig (Ludwig) and Norton Rose Fulbright LLP Defendants _______________________________________________________ Memorandum of Decision of J. Farrington , Master in Chambers

_______________________________________________________ The Application This is an application for security for costs. For the reasons that follow, I direct that security for costs be posted, but not in the amount sought by the applicant. Background [ 1 ] As is usually the case, context is important. [ 2 ] The Plaintiff Ingrid Hayden was a long time employee of Alberta Health Services. She experienced some issues in the workplace, which led to disputes, which led to disciplinary action and termination by the employer, which led to grievances.

The centrepiece of the action is a grievance hearing which took place in May, 2014. Ms. Hayden was assisted with the grievance and at the hearing by her union, the Alberta Union of Provincial Employees (“AUPE”). Alberta Health Services was represented by counsel Erin Ludwig of the Norton Rose Fulbright LLP (as that entity is named in the Statement of Claim) firm. [ 3 ] Ms. Hayden was unsuccessful in pursuit of the grievance. She says that it was because the AUPE and AHS Counsel Ms.

Ludwig colluded to suppress medical evidence that was of the utmost importance in pursuit of the grievance. [ 4 ] No appeal or judicial review of the workplace arbitration was sought. Ms. Hayden says that was the fault of the AUPE. Ms. Hayden filed an Alberta Labour Relations Board complaint against her union alleging that it did not fairly represent her at the hearing. That complaint was dismissed by the Alberta Labor Relations Board, although Ms. Hayden has requested a reconsideration of that decision and a decision on the reconsideration motion is apparently still pending. Ms.

Hayden did file an application in this Court for judicial review of the Alberta Labour Relations Board dismissal of her unfair representation complaint and that is an active and ongoing action. [ 5 ] Ms. Hayden sues many individuals in this action. A large number of them were from Alberta Health Services, and some of them were from AUPE, including AUPE’s counsel. She did not originally name the Alberta Health Services entity itself, and the AUPE entity itself, but on a different application, I allowed Ms. Hayden’s application to file an Amended Statement of Claim naming those entities as parties. [ 6 ] Ms.

Hayden also sues Ms. Ludwig and Norton Rose Fulbright LLP, who were not her counsel, but counsel for Alberta Health Services, alleging among other things that they were part of a conspiracy to suppress her medical evidence, and that they had a duty to arrange for and call Ms. Hayden’s medical evidence at the workplace arbitration. [ 7 ] In the fall of 2016 a group of applications came to be scheduled before me. They included applications to strike the action by the AHS and AUPE entities and those individuals involved with them. They also included an application by Ms.

Hayden to file her Amended Statement of Claim and an application by Ms. Hayden to compel answers to questions and responses to undertakings that had been requested by Ms. Hayden from Ms. Ludwig in a questioning on a

summary dismissal application brought by Ms. Ludwig and Norton Rose Fulbright LLP. That

summary dismissal application is not, and has not been, before me. The remaining application that formed part of the group of applications that came before me was this application for security for costs. [ 8 ] Inevitably, the time of argument for all of the applications before me exceeded the available and allotted time, and the Court made special accommodations for the parties to find available times to hear and continue the various applications. [ 9 ] The time eventually allotted for hearing the security for costs application was January 20, 2017.

On that day, the time for submissions again exceeded the available half-day special time allotted and the Court made a special accommodation to hear continuation of the matter on January 25, 2017, notwithstanding that the date was not a regularly scheduled Court sitting date. [ 10 ] I have now heard all of the applications which originally came before me in the fall of 2016. On January 12, 2017 I delivered oral reasons dealing with the Alberta Health Services and AUPE applications to strike.

I granted those applications for various reasons, including on the basis that issues pertaining to those entities were already determined in the labour relations setting, and the Amended Statement of Claim in this action was a collateral attack upon those proceedings and on issues which had already been decided. As indicated previously, judicial review proceedings remain extant on the AUPE matter and my oral reasons made it clear that they did not affect those proceedings. [ 11 ] The action as framed against Ms. Ludwig and Norton Rose Fulbright LLP stands on a different foundation.

It is not an attempt to argue issues that have already been decided. The allegations are tort allegations against them regarding conduct of the workplace arbitration. For that reason, they stand on a different footing. The Law on Security for Costs Generally [ 12 ] The approach of Chief Justice Wittmann in Attila Dogan Construction v. AMEC Americas Limited , 2011 ABQB 175 on security for costs is often cited in security for costs applications. I intend to follow that approach, although in many respects this matter is largely fact driven.

Ultimately, the factors enumerated in 4.22 of the Alberta Rules of Court play a critical role. [ 13 ] Rule 4.22 provides: 4.22 The Court may order a party to provide security for payment of a costs award if 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 action in which the application is filed; (

d) whether an order to give security for payment of a costs award would unduly prejudice the respondent’s ability to continue the action; (

e) any other matter the Court considers appropriate. [ 14 ] The Court considers the matter having regard to all of those factors, and any others that may be appropriate, in order to determine what is “just and reasonable”, to use the wording of the rule. Analysis of the Factors Assets in Alberta [ 15 ] Ms. Hayden has a home. There is mortgage security registered on the home and any equity in the home would likely be exempt from execution. There does not appear to be evidence of any other significant assets. This factor weighs in favour of the security for costs application. Ability to Pay a Costs Award [ 16 ] Ms.

Hayden does not argue that she has an ability to pay a significant cost award. She submitted material, albeit very late in the proceedings, detailing her income and current cash flow and it demonstrates a likely inability to pay a significant cost award. Ms. Hayden does not argue otherwise. For that reason, and out of respect for Ms. Hayden’s privacy on an issue that is not contested, I do not intend to discuss the specific details of her assets or financial position. This factor weighs in favour of the security for costs application.

Merits of the Action [ 17 ] The vast majority of time during argument was spent on this point. Ms. Ludwig and Norton Rose Fulbright LLP argue strenuously that there is no duty of care owed from opposing counsel to the opposing litigant in a contested litigation manner (see Ma v. Quinn , 2011 ABQB 103 , Big Bear Hills Inc. v. Bennett Jones Alberta Limited Liability Partnership , 2010 ABQB 764 , Hanson v. Hanson , 2009 ABCA 222 , ESA Holdings Ltd. v. Shea Nerland Calnan LLP , 2007 ABQB 78 and German v. Major , 1985 ABCA 176 among other cases). [ 18 ] Ms.

Hayden took the Court through her analysis in great detail arguing that as Ms. Ludwig had taken some steps during the course of the litigation to obtain subpoenas in relation to medical records, she had undertaken obligations towards her in relation to those records. She argues that Ms. Ludwig having requested them, she was somehow obliged to ensure their use at trial. Ms. Ludwig replies that she was requesting them only so that she had access to them if needed in the event that Ms. Hayden elected to call medical evidence and raise medical issues at the arbitration. In other words, she wanted to be prepared.

In the end, the AUPE called no medical evidence on behalf of Ms. Hayden. Ms. Hayden and the AUPE disagree as to why that happened, and that formed the basis for the unfair representation complaint to the Alberta Labour Relations Board. [ 19 ] At times during argument Ms. Hayden seemed to acknowledge that in the ordinary course one would expect that a decision as to whether or not to call medical evidence at the arbitration on her behalf would fall solely to herself and her union.

At other times, her argument was that somehow there was an obligation upon AHS counsel to make certain that the medical evidence was called if her union did not do so. [ 20 ] Ms. Hayden raises many other arguments. She took the Court in great detail through what she says are inconsistencies in Ms. Ludwig’s evidence. For example, she complains that Ms. Ludwig was sending arbitration related materials to AHS personnel in places in Alberta where Ms. Hayden thought they ought not to be sent. Of course, Ms.

Ludwig can send materials to persons at her client’s organization that she chooses to send them to as she deems necessary. That is her call, not Ms. Hayden’s. AHS was her client and she was at liberty to deal with her client as she thought necessary. [ 21 ] Similarly, Ms. Hayden made much of identifying the finer details as to exactly when Ms. Ludwig was retained. She did this in advancing her theory that there was an ongoing conspiracy to remove her from her position. While there may be some minor inconsistencies and lost recollections on dates, the terms of the retainer are between Ms.

Ludwig and AHS, and the terms of what was expected from Ms. Ludwig by AHS at any given time were between Ms. Ludwig and AHS. Ms. Ludwig was actively involved at the workplace arbitration hearing and that is the crux of the action. There is no material that on its face would appear to be indicative of a conspiracy as alleged. [ 22 ] As to the merits of the action aspect, Ms. Ludwig and Norton Rose Fulbright LLP have met their onus us to show an arguable defence. This factor tends to support these defendants’ application for security for costs.

Would an order unduly prejudice the plaintiff’s ability to continue the action? [ 23 ] Ms. Hayden emphasized this point during her submissions and she provided authorities. She cited Parkland Industries Ltd. v. 897728 Alberta Ltd , 2015 ABQB 10 , Crothers v. Simpsons Sears Ltd ., 1988 ABCA 155 , Trosin v. Sikora 2002 ABQB 195 , Estate Associates Inc. v. 1645112 Ontario Ltd . 2016 ONSC 150 , Reset Electronics Inc. v. Hydro One Networks Inc. , 2016 ONSC 921 , Thomas Fuller Construction Co. v. Bisson , 2016 ONSC 2684 , Triple A Farms v. State Agriculture Development Inc. , 2014 SKQB 369 and Hornbrook v.

Hornbrook , 199 ABQB 52.

[24] Ms. Hayden urged the Court to do what she referred to as “justice” in this case, and not require the posting of security becauseposting the requirement to post security could well have a significant impact on her ability to carry on the action. There is no doubt thatsuch an order may well have that impact. [25] “Justice” is an often referred to concept, but in this context, what does that term really mean? And who is “justice” meant toserve? [26] In Hryniak v.

Mauldin, 2014 SCC 7 , [2014] 1 SCR 87 Karakatsanis, J. held at paragraph 23: This appeal concerns the values and choices underlying our civil justice system, and the ability of ordinary Canadians to access thatjustice. Our civil justice system is premised upon the value that the process of adjudication must be fair and just. This cannot becompromised. [27] In Liu v. Tangirala, 2005 ABQB 246, Lefsrud, J. held at paragraph 31 (paraphrasing from Watson, J. in Crocker-McEwingv.

Drake, 2001 ABQB 13): Justice Watson considered the effect of a security for costs application on an impecunious plaintiff, stating that it is not desirable toimpose a security for costs requirement that simply ends a meritorious action. Justice Watson went on, however, to state that harm to thedefendants cannot simply be dismissed if the action is doubtful. He advocated an approach whereby the Court should look first at therealities of potential losses to the parties to determine if there could be a serious impairment of justice, and then consider the relativestrength of the positions of the parties (para. 62).

Justice Watson concluded that while a high level of security for costs wouldeffectively end the action, a more modest order would not necessarily do so. Furthermore, the plaintiff’s action was “weak” while thedefendant’s position was, on its face, sound enough to invoke the Rule.

Security for costs was ordered. [28] Lefsrud, J. further held at paragraph 35: Based on the foregoing, whether an impecunious plaintiff can be required to put up security for costs will be largely fact driven and willrequire the Court to undertake a careful balancing of the competing considerations in the individual circumstances of each application. [29] In Crocker-McEwing v.

Drake, which was cited by Lefsrud, J., Watson J, held: The fundamental policy balance is between the desire not to unnecessarily or unfairly impede access to the Courts by legitimate and bonafide Plaintiffs and the desire to ensure that the administration of justice is not perverted by encouraging risk-free and doubtful litigationclaims by Plaintiffs to the harassment of, and to the imposition of practically unrecoverable cost upon, Defendants who are possessed offacially meritorious answers to such claims. Both policy considerations deserve great respect.

Access to the Courts is a matter going to the very heart of the viability and credibility ofthe administration of justice. Limitations on that access should be driven by strong grounds of policy: see e.g. B.C.G.E.U.[11]. On theother hand, the uses of recoverable and case-related costs has long been accepted as a means of regularizing the processes of Courts andensuring fairness therein. Moreover, the use of costs is to serve the further aim of discouraging the phenomenon of legal proceedingswhich become the tool of the recreational litigant or, worse, the litigation terrorist.

Judicial notice can, arguably, be taken about thelitigation atmosphere of our great southern neighbour. There, costs do not have the same function or characteristics as they do in Canada. [30] In my view, justice in the circumstances of this application necessarily entails an objective consideration of the fact situationand the law, in a way that is fair to all of the parties to the litigation. Justice is not viewed solely from the subjective perspective of one ofthe litigants.

While the plaintiff deserves the right to proceed with a meritorious case, and that right merits protection on the facts inmany cases, a defendant equally deserves at least some protection from the costs consequences of a case that is perhaps less thanmeritorious on its face. [31] The dividing line in the cases appears to be a consideration of the merits of the matter generally. The cases support theproposition that no security should be ordered when the claim has been demonstrated to have arguable merit.

On the other hand, the casefor the non-posting of security is weaker if a case has demonstrable frailties. [32] There is no doubt that Ms. Hayden genuinely feels strongly about her position. She has every right to commence an action andshe has done so. Once she has done so, however, that also engages rights for those persons against whom an action has been commenced.Serious allegations have been made by Ms. Hayden.

In fact, it is hard to envision a more serious allegation against a litigation lawyerthan being accused of being part of an alleged conspiracy to suppress evidence. [33] A person of who makes those allegations is subject to significant and potentially aggravated cost awards if the allegations arenot proven. The law is problematical if allegations of that nature can be made with impunity by someone who is not in a position tohonour a costs award unless the allegations appear to have reasonably strong preliminary merit.

Defendants are entitled to the benefits(and subject to the burdens) of the Rules of Court in the same way as are plaintiffs. The potential of a costs award is a check and balancein the system. [34] While I am mindful of Ms. Hayden’s strong argument that the effects of a security for costs award may impact her ability toconduct this litigation, I must consider the application based upon the law, and based upon the facts. The facts of this matter are that theclaim as against Ms. Ludwig and Norton Rose Fulbright LLP is an extremely novel one, because the cases consistently hold that a dutysuch as that argued by Ms.

Hayden does not exist. To find such a duty would place opposing counsel in the untenable position of owingduties to both sides in an adversarial system. Short of evidence of a fact situation that created a duty here, the road appears to be adifficult one for Ms. Hayden. [35] Ms. Hayden will have every opportunity to prove issues of merit for trial at the defendants’

summary judgment applicationwhen it is heard, and moving forward with this matter generally. Based upon the evidence at this stage, however, her task appears to be adaunting one.

[ 36 ] This is not the type of meritorious case that cries out for an exception to the normal security for costs considerations. The exception that has been traditionally carved out is for cases that have demonstrable merit. Unfortunately for Ms. Hayden, this one case does not fall into that category in light of the applicable law and the facts. Other factors [ 37 ] Ms. Ludwig and and Norton Rose Fulbright LLP argued that there are previous unpaid costs awards. Ms.

Hayden submitted evidence that most of those have been paid and she acknowledges that the costs awards totaling $11,000.00 that I made in my oral decision of January 12, 2017 dismissing her claims against AHS and AUPE have not been paid. Those are very recent and I have not regarded those as a significant factor in my decision. [ 38 ] I further note that the litigation itself has been contentious. There have been numerous Court applications and inevitably the Court applications have exceeded the typical time available for a half day special.

In particular, there were applications dealing with the issue of who should pay the examining reporter cost when Ms. Hayden was questioning, and a lengthy hearing regarding an attempt to compel answers by Ms. Hayden. Ms. Hayden was unsuccessful on both of those applications. I have regarded these applications as a factor, although a small one, simply to recognize that the current litigation has the potential to be more expensive than many other actions as a result of the fact that there have been a number of motions that ought to have been unnecessary.

Result [ 39 ] Considering all of the above, I order that security for costs be posted by Ms. Hayden. Ms. Ludwig and Norton Rose Fulbright LLP sought approximately $50,000.00 through to trial. I decline to order that amount at this time for several reasons. One reason is that if the defence case is as strong as the defendants contend, the case may not need to go to trial. The primary reason is that the Court may order the phased posting of security for costs in its discretion.

I find that a phased approach would be appropriate in this case. [ 40 ] I direct that the amount of $18,000 be posted with the Clerk as security for the costs of Erin Ludwig and Norton Rose Fulbright LLP within 120 days of the date of these reasons. [ 41 ] I have selected that time frame in order to provide Ms. Hayden with a reasonable period of time for raising the required security, and for her to consider all of the interrelated parts of her actions generally and decide where to best allocate her resources. The action is stayed as against Ms.

Ludwig and Norton Rose Fulbright LLP pending the posting of the security. If the security is not posted within the required time frame, the action is dismissed without further order. These defendants shall have leave to reapply for further security after both their

summary judgment application has been heard (or withdrawn) and their Affidavit of Records has been served. [ 42 ] Because the issue was raised previously, and assuming posting of the security such that the stay is lifted, I confirm for clarity that I make no direction as to whether these defendants’ affidavit of records need be provided prior to the

summary judgement application being heard or not. If the parties cannot agree, that issue will need to be resolved by application having regard to P. Burns Resources Limited v Honourable Patrick Burns Memorial Trust , 2015 ABCA 390 principles. Heard on the 20 th and 25 th days of January, 2017. Dated at the City of Calgary, Alberta this 15 th day of February, 2017. J. Farrington M.C.C.Q.B.A. Appearances: Ingrid Hayden Plaintiff Self Represented Litigant Caron & Partners LLP R.J. Daniel Gilborn

for the Defendants Erin Ludwig and Norton Rose Fulbright LLP