KATHERINE CABANA v. BRAD CABANA, 2024 NLCA 4

IN THE COURT OF APPEAL OF NEWFOUNDLAND AND LABRADOR Citation : Cabana v. Wells , 2024 NLCA 4 Date : January 29, 2024 Docket Number : 202301H0019 BETWEEN: KATHERINE CABANA and BRAD CABANA APPELLANTS AND: JOE WELLS FIRST RESPONDENT AND: ROD MURPHY SECOND RESPONDENT AND: RE/MAX EASTERN EDGE REALTY THIRD RESPONDENT AND: KATRINA A. BRANNAN FOURTH RESPONDENT AND: HUGHES AND BRANNAN LAW OFFICES FIFTH RESPONDENT

AND: JOHN D. BERGHUIS SIXTH RESPONDENT AND: CONTROL SURVEYS LIMITED SEVENTH RESPONDENT AND: BILL MARTIN EIGHTH RESPONDENT AND: BILL MARTIN CONSTRUCTION LIMITED NINTH RESPONDENT AND: NEWFOUNDLAND AND LABRADOR CREDIT UNION TENTH RESPONDENT Coram: D.E. Fry C.J.N.L., D.M. Boone and K.J. O’Brien JJ.A. Court Appealed From: Supreme Court of Newfoundland and Labrador, General Division 202001G3963 ( 2023 NLSC 46 ) Appeal Heard: October 27, 2023 Judgment Rendered: January 29, 2024 Reasons for Judgment by: K.J. O’Brien J.A. Concurred in by: D.E. Fry C.J.N.L. and D.M. Boone J.A.

Counsel for the Appellants: Self-Represented Counsel for the First, Second And Third Respondents: Christopher J. Peddigrew, K.C. Counsel for the Fourth and Fifth Respondents: No Appearance Counsel for the Sixth and Seventh Respondents: Raymond G. Critch Counsel for the Eighth and Ninth Respondents: Glen W. Picco, K.C. Counsel for the Tenth Respondents: Bruce D. Grant, K.C. Authorities Cited: CASES CITED: Canada (Transportation Safety Board) v. Carroll-Byrne, 2022 SCC 48; Petten v. E.Y.E. Marine Consultants (1995), (NL SC), 130 Nfld. & P.E.I.R. 205 (NLTD); Gondal v.

Buchans River Ltd., 2009 NLCA 29, 285 Nfld. & P.E.I.R.211; Walsh v. Johnson, 2010 NLCA 6, 293 Nfld. & P.E.I.R. 101; Fiander v. Mills, 2015 NLCA 31, 368 Nfld. & P.E.I.R. 80; Hynes v.Pro Dive Marine Services Ltd., 2016 NLCA 17, 376 Nfld. & P.E.I.R. 181; Fields of Athenry Resort Corporation v. Grey, 2018 NLSC215; Atlantic Lottery Corp. Inc. v. Babstock, 2020 SCC 19, [2020] 2 S.C.R. 420; R. v. Clark, 2005 SCC 2, [2005] 1 S.C.R. 6; Housen v.Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235; Cabana v.

Newfoundland and Labrador, 2020 NLCA 44, 6 C.A.N.L.R. 199, leave toappeal to SCC refused, 39716 (2 December 2021); Williams v. Cabana, 2015 NLCA 8, 363 Nfld. & P.E.I.R. 354, leave to appeal to SCCrefused, 36387 (19 November 2015); Wewaykum Indian Band v. Canada, 2003 SCC 45, [2003] 2 S.C.R. 259; Cabana v. Newfoundlandand Labrador, 2014 NLCA 34, 356 Nfld. & P.E.I.R. 103; Penney v. Newfoundland and Labrador, 2021 NLCA 35, 6 C.A.N.L.R. 683; R.v. Novak, (BCCA); The College of the North Atlantic v. Thorne, 2015 NLCA 47, 371 Nfld. & P.E.I.R. 31; R. v. S. (R.D.), (SCC), [1997] 3 S.C.R. 484.

RULES CONSIDERED: Rules of the Supreme Court, 1986, SNL 1986, c. 42,

Schedule D, rules 21.01, 14.24, 18A. K.J. O’BRIEN J.A.: [1] This is an appeal by Katherine Cabana and Brad Cabana of a security for costs order (Cabana v. Wells, 2023 NLSC 46, the“Decision”). OVERVIEW [2] The Cabanas filed a statement of claim for damages against ten defendants relating to a waterfront property in Hickman’sHarbour, Newfoundland and Labrador, which they purchased in 2010 (the “Property”). The defendants, who are respondents in thisapplication, can be grouped as follows: a.

The real estate agents, who listed the Property and who the Cabanas say acted for them on the purchase (first, second andthird respondents); b. The lawyers, who acted for the Cabanas on the purchase and mortgage of the Property (fourth and fifth respondents); c. The surveyors, who surveyed the Property in 2010 and in 2015 (sixth and seventh respondents); d. The contractors, whom the Cabanas hired in 2015 to demolish the existing house and build a new house on the Property(eighth and ninth respondents); and e.

The credit union, which financed the demolition and rebuild, and secured the Property with two mortgages (tenthrespondent).

[ 3 ] The Cabanas listed the Property for sale in 2018 and found a buyer. However, the sale fell through when the buyer discovered a problem with the Property’s title. Part of the house built in 2015 was constructed on the foreshore, outside of the Property boundary. After the title defect was discovered, the Cabanas stopped paying on the mortgages and advised the credit union of the title defect.

The credit union eventually sold the Property under power of sale. [ 4 ] The Cabanas’ claims against the respondents can be briefly summarized as follows: a. the real estate agents failed to inform the Cabanas that the Property extended into the foreshore and required a Crown lease; b. the lawyers misrepresented the Property’s title as free and clear of encumbrances and, further, failed to advise the Cabanas to purchase title insurance; c. the surveyors misrepresented the Property on surveys by failing to note the extension onto the foreshore; d. the contractors negligently advised the Cabanas to build on the foreshore and failed to warn them that it was unlawful to build there without a Crown lease. e.

The credit union induced the Cabanas to enter into a mortgage knowing that title to the Property was defective without disclosing the defect. [ 5 ] The Cabanas allege that the corporate respondents are vicariously liable for the actions of the professionals who worked for them. [ 6 ] All the respondents have defended the Cabanas’ claims. Four of the respondent groups, all except the lawyers, filed an application for security for costs pursuant to rule 21.01 of the Rules of the Supreme Court, 1986 . Rule 21.01 gives the court discretion to order security for costs whenever it deems just: 21.01.

The Court may order security for costs to be given in a proceeding whenever it deems it just, and without limiting the generality of the foregoing, it may order security to be given where (

a) a plaintiff resides out of the jurisdiction; (

b) a plaintiff is ordinarily resident out of the jurisdiction, although the plaintiff is temporarily within the jurisdiction; (

c) a plaintiff commences a proceeding to enforce a cause of action that is the subject matter of an earlier proceeding commenced by the plaintiff and still pending; (

d) a plaintiff, or any person, through or under whom the plaintiff claims, has an order against the plaintiff for costs that have not been paid; (

e) a proceeding is brought by a nominal plaintiff; (

f) upon the examination of a plaintiff it appears that there is a good reason to believe that the proceeding is frivolous and vexatious, and that the plaintiff is not possessed of sufficient property within the jurisdiction to pay costs; (

g) a proceeding is brought on behalf of a class; (

h) by a statute, a party is entitled to security for costs; or (

i) a plaintiff, with the view to evading the consequences of the litigation, has not stated an address in the originating document, or stated it incorrectly therein, or changed the address during the course of the proceeding. [ 7 ] The judge who heard the application found that the Cabanas did not have the financial means to provide security for costs.

Despite this finding, he ordered security for costs because he found that the Cabanas were trying to exploit a problem of their own creation, that they were not acting in good faith, and that their statement of claim was frivolous, vexatious and an abuse of the court process (Decision, at paras. 40-42). The judge ordered the Cabanas to pay $30,000.00 as security for costs, to be allocated equally between the four respondent groups, i.e., $7,500.00 per group. [ 8 ] The Cabanas raise several arguments on appeal, which I would state as follows: 1.

The judge erred in finding that the Cabanas did not act in good faith and that their claim was frivolous, vexatious and an abuse of process, when he: a. did not state the legal test he was applying to make those determinations or explain how he came to his conclusions; b. failed to understand that the Cabanas’ complaint was rooted in their purchase of the Property in 2010, not in their building of the new house in 2015; c. failed to consider the principles of negligence, negligent misrepresentation and fraudulent misrepresentation when assessing the Cabanas’ claims; and d. wrongfully considered that the Cabanas had proposed amending the statement of claim to add additional defendants, when the Cabanas had not proceeded with that amendment. 2.

The judge’s conclusions and use of prejudicial language in the Decision create a reasonable apprehension of bias, such that

the judge should not hear the trial or any further applications in this matter. [9] For the reasons that follow, I would allow the appeal because the judge erred in applying the legal tests for “bad faith”,“frivolous and vexatious” and “abuse of court process” to the Cabanas’ claim. His findings relate directly to the Cabanas’ credibility withrespect to their allegations and the merits of their claims against the respondents.

In these circumstances, where the judge has expressed asettled view with respect to matters that still have to be adjudicated, I would further disallow the judge from continuing to adjudicate inthis matter to prevent a reasonable apprehension of bias. STANDARD OF REVIEW [10] The standard of review of a discretionary decision is set out in Canada (Transportation Safety Board) v.

Carroll-Byrne, 2022SCC 48: [41] … A discretionary decision…is generally entitled to deference and may only be interfered with if there is a legal error (considered tobe an error in principle), a palpable and overriding factual error (viewed as a material misapprehension of the evidence) or a failure toexercise discretion judicially (which includes acting arbitrarily or being "so clearly wrong as to amount to an injustice"). … ISSUE 1: Did the judge err in finding that the Cabanas did not act in good faith and that their claim was frivolous, vexatiousand an abuse of process? [11] The framework for applications for security for costs under rule 21.01 was set out in Petten v.

E.Y.E.

Marine Consultants(1995), (NL SC), 130 Nfld. & P.E.I.R. 205 (NLTD). [12] If an applicant shows that the case is within one of the categories listed in the rule, the applicant is prima facie entitled tosecurity for costs and the evidentiary burden shifts to the responding party to show why the justice of the particular case neverthelessrequires that security not be posted (Petten, at para. 17). [13] Here, the Cabanas conceded that they did not live in the jurisdiction (rule 21.01(a)) and thus the onus was on them to establishthat a security for costs order was not warranted (Decision, at para. 21). [14] As established in Petten, there were two ways for the Cabanas to do this.

The first was to show that they had significant assetsin the jurisdiction or would otherwise be able to satisfy an order for costs if one was ultimately ordered (Petten, at para. 18). TheCabanas chose the second way, which is described in Petten as follows: [18] …The second, and alternative, course would be for the responding party to concede financial weakness and argue that the positionis so financially precarious that to require security would in effect drive him or her from the court room.

In this scenario, the respondentwill be stressing financial weaknesses and the applicant will have to argue that the financial position is not so weak as to make itimpossible to provide security. [15] The judge was satisfied that the Cabanas had established that they were neither able to provide security for costs from theirpresent means nor capable of borrowing to do so (Decision, at paras. 26-27). This finding has not been challenged on appeal. [16] However, the Cabanas’ inability to pay security for costs did not end the inquiry.

Even if a court is satisfied that the plaintiff issufficiently impecunious that to order security for costs would effectively drive them from the courtroom, the court must balance theplaintiff’s right of access to the court against the defendant’s right not to be subject to abusive, frivolous, or vexatious claims by litigantsfrom whom costs orders may not be recoverable (Petten, at para. 20; Gondal v. Buchans River Ltd., 2009 NLCA 29, 285 Nfld. &P.E.I.R. 211, at para. 12).

If the court is satisfied that the plaintiff’s case is sufficiently meritless, vexatious or frivolous, or an abuse ofthe court’s process, the court may find that the balance tips in favour of granting the security for costs order. [17] Here, the judge found that security for costs was warranted. The question is whether he erred in so doing. The applicable legal tests [18] In the context of assessing litigation claims, the concepts of “bad faith”, “frivolous and vexatious” and “abuse of court process”overlap.

This Court has previously noted this overlap in relation to applications to strike claims pursuant to rule 14.24 (Walsh v. Johnson,2010 NLCA 6, 293 Nfld. & P.E.I.R. 101, at paras. 19-21; Fiander v. Mills, 2015 NLCA 31, 368 Nfld. & P.E.I.R. 80, at paras. 34-36;Hynes v. Pro Dive Marine Services Ltd., 2016 NLCA 17, 376 Nfld. & P.E.I.R. 181, at para. 13).

Although rule 14.24 does not include theterm “bad faith”, the observation applies equally to assessing claims under rule 21.01. [19] To assess a claim against the standards of “bad faith”, “frivolous and vexatious” and “abuse of court process”, a court shouldconsider: a. The merits of the alleged claim based on the pleadings, that is, the extent to which the claim is founded in law and groundedin relevant factual assertions or uncontested facts. Claims with no or low merit are more likely to be frivolous, vexatious, and abusive ofcourt processes.

That said, a plaintiff need not show that their case is likely to succeed. A claim is not frivolous and vexatious if theplaintiff has raised an arguable issue. b. The plaintiff’s purpose in bringing the claim, that is, whether the plaintiff has a sincere belief in their entitlement to the reliefclaimed or whether they are acting for ulterior motives such as to harass, threaten or embarrass a party. Claims brought for improperpurposes are more likely to be in bad faith, vexatious, or an abuse of process. c.

The plaintiff’s use of the court process, that is, whether the plaintiff is using court procedures appropriately for thelegitimate vindication of legal rights or whether they are unreasonably and purposefully wasting time and resources. Illegitimate use ofcourt resources is more likely to be assessed as in bad faith, frivolous, vexatious, or abusive.

[20] This is not a closed list as other factors may be relevant in the context of the case. [21] Additionally, to assess the merits of the claim, the court should not conduct an evidence-based examination of the strength ofthe case. As stated by the Supreme Court judge in Fields of Athenry Resort Corporation v. Grey, 2018 NLSC 215: [22] In my view, it is not appropriate to enter into an evidence-based examination of the merits of the plaintiffs’ case when dealing witha pre-trial application for security for costs.

Unless the weakness of the case is apparent from the pleadings or unless undisputed factsare put before the Court, an assessment of the merits of the case should await trial. However, if other evidence – not directly related tothe substantive case – suggests that the proceeding is otherwise “frivolous and vexatious”, such evidence is properly considered. SeeWall v. Horn Abbot Ltd. (1999), (NS CA), 176 N.S.R. (2d) 96 (N.S.C.A.).

The judge’s consideration of the Cabanas’ claims [22] The judge did not state the legal tests he was applying to determine that the Cabanas were acting in bad faith, that theirstatement of claim was frivolous and vexatious, or that they were abusing the court process. A judge’s failure to expressly state theapplicable legal test is not a reversible error.

The question is whether it is apparent on the record that he considered the appropriate law,and the result of his decision was justifiable based on the proper legal tests (Fiander, at para. 16). [23] The judge placed considerable weight on a recitation of events that the Cabanas included in the Memorandum of Fact and Lawthat they filed in response to the application. The judge reproduced the relevant passage at paragraph 30 of the Decision: 11. In May of 2015, the Cabanas negotiated with … [Martin and Martin Construction] to demolish their old home and construct theirnew home on the property. 12.

On the 22nd day of May, 2015 Martin and employees of Martin Construction demolished the old home. Shortly thereafter Martincontacted the Cabanas and advised them their proposed new home would not fit on the current lot, and that fill, footings, and cribbingwould have to be added into the water to support the house at an additional cost of $20,000. Martin did not advise the Cabanas of anynecessity to have a permit or foreshore lease to fill and build into the water. The Cabanas agreed and proceeded with the work. … 14.

As a result of Martin Construction’s filling and cribbing work, an addition of approximately 20 feet wide by 40 feet long was builtinto the foreshore, upon which a new double wide parking spot, a corner of the new house, and a major portion of the new deck werebuilt. [Emphasis in original] [24] The above passages were also included in paragraphs 20 and 22 of the Cabanas’ statement of claim.

From these passages, thejudge determined that the Cabanas knew as early as May 2015 that the new house did not fit on the land that they bought in 2010; thatthe land had to be extended into the foreshore to accommodate the new construction; and that they authorized and instructed thecontractors to do the work (Decision, at para. 31). [25] The judge rejected the Cabanas’ argument that they did not understand the legal ramifications of extending their propertyfurther into the foreshore in 2015. He wrote: [36] The Cabanas’ position is untenable: Mr. Cabana is an intelligent, articulate person.

It is clear from the pleadings and the argumentsthat he files in these causes and the materials that he offers in support of them, that he understands the nuances of real property law andthat he would handily understand the implications for selling and mortgaging his property of its encroaching on the foreshore. It isinsincere and indefensible to suggest otherwise. [26] This finding was central to his ultimate conclusions: [40] Overall, I find that the Cabanas are not acting in good faith in the claim they have brought against the Defendants.

The problemsthe Cabanas had with their property in Hickman’s Harbour are rooted in the directions that they gave to [the contractors] to backfill theforeshore to the property and to build into the backfilled area. [41] First, they tried to exploit the problem of their own creation to forestall paying their mortgage off after the property’s sale fellthrough when the encroachment came to light and now, they are suing all parties who had any involvement with the property between2010 and 2018 and blaming them for their losses. [42] The Cabanas’ claim is both frivolous and vexatious and an abuse of the process of this Court.

Analysis of the judge’s reasoning [27] Respectfully, I would find that the judge made legal and material factual errors in his assessment of the Cabanas’ claimsagainst the standards of “bad faith”, “frivolous and vexatious” and “abuse of court process”. [28] First, the judge’s conclusion that the Cabanas’ problem was “rooted in” the directions that they gave the contractor in 2015 andthat they were seeking “to exploit the problem of their own creation” is not supported by a full and fair reading of the pleadings.

Ifpossible, cases should be disposed of on their merits, so when assessing claims at the pleadings stage, the statement of claim should beread as generously as possible (Atlantic Lottery Corp. Inc. v. Babstock, 2020 SCC 19, [2020] 2 S.C.R. 420, at para. 88). Here, the judgefailed to consider the Cabanas’ allegation that the Property had already been extended by cribbing into the foreshore when theypurchased it in 2010. Nor did he consider their allegation that the surveyor wrongfully showed the foreshore extension as within the legalboundary of the Property prior to their concluding the purchase.

In effect, the Cabanas alleged that their problem was “rooted in” their

purchase of the Property, which they alleged had a title defect that the professionals assisting them with the purchase had not advised them of (Statement of Claim, Appeal Book, Tab 4, at paras. 13-17).

Moreover, even if it is determined at trial that the Cabanas contributed to their losses by their negligent or intentional actions or decisions, this would not necessarily preclude them from establishing that others were partially responsible for those losses. [ 29 ] These other aspects of the statement of claim were also relevant to the judge’s assessment of the tenability of the Cabanas’ position that they did not understand the legal ramifications of extending their property further into the foreshore in 2015.

Their position rested on their allegation that a significant portion of the Property was already cribbed into the foreshore when they purchased it. [ 30 ] Second, I would find that the judge’s finding that Mr. Cabana understood “the nuances of real property law” and would “handily understand the implications for selling and mortgaging his property of its encroaching on the foreshore” was in error. The judge supported his finding by referencing the pleadings and the arguments that Mr. Cabana filed and the materials that he offered in support of them (Decision, at para. 36).

However, these documents do not support the judge’s conclusions. It is an error for a judge to make a factual inference that is unsupported by the evidence or other material properly before them ( R. v. Clark , 2005 SCC 2 , [2005] 1 S.C.R. 6, at para. 9 ; Housen v. Nikolaisen , 2002 SCC 33 , [2002] 2 S.C.R. 235, at paras. 22-23 ). [ 31 ] The Cabanas are self-represented litigants. Mr. Cabana, in particular, has prior experience before the courts (see Cabana v. Newfoundland and Labrador , 2020 NLCA 44 , 6 C.A.N.L.R. 199 , leave to appeal to SCC refused, 39716 (2 December 2021); Williams v.

Cabana , 2015 NLCA 8 , 363 Nfld. & P.E.I.R. 354 , leave to appeal to SCC refused, 36387 (19 November 2015)). The documents that he prepared and filed in this case show that he understands something of real property law and the legal issues involved in his claim. However, these documents were all prepared in 2020, or later, and do not demonstrate Mr. Cabana’s knowledge of real property law between 2010 and 2018, the years relevant to his claim. There was no information before the judge as to Mr.

Cabana’s knowledge of real property law or the legal implications of building into the foreshore during the relevant period. [ 32 ] I would also find that the judge erred in principle on two further points: (

i) by putting undue emphasis on the number of defendants named in the statement of claim; and (ii) by relying on the language used in the statement of claim to support his finding of bad faith. [ 33 ] With respect to the number of defendants, the judge wrote: [37] The Cabanas approach the claim against the ten Defendants with the aim of a flared muzzle, in blunderbuss style: File a claim against everyone who had anything to do with the property, regardless of when or how they were involved; and as for the responsibilities the Cabanas had under the mortgages they gave to the credit union, claim that the mortgagee duped them too, use that to create an “event of default” and then encourage the mortgagee to resort to its “title insurance … so as to reduce the harm to itself, and also to us”. [ 34 ] The judge also referenced the Cabanas’ consideration of adding four additional defendants to the claim, including another lawyer and his firm. [ 35 ] The number of defendants named in a statement of claim reveals little about whether the claim is made in bad faith, is frivolous and vexatious, or is an abuse of court process.

The individual claims against each defendant must be assessed to determine if they are founded in law and grounded in relevant factual assertions. It may be entirely appropriate to claim against ten, or more, defendants if it is alleged, with sufficient legal and factual foundation, that each is liable for contribution to the alleged harm. [ 36 ] Although the inclusions of meritless claims against several defendants could indicate that a plaintiff is engaged in an abuse of process, here the judge did not analyze the claims against the defendants individually.

He focused on the number of defendants and the fact that the Cabanas had circulated a draft amended statement of claim that included four more defendants (Decision, at para. 38). However, the number of defendants was not meaningful unless it was also shown that at least some of those claims were meritless or of low merit.

Additionally, the fact that the Cabanas had considered adding four defendants, but decided not to, demonstrates a reasoned decision, and not an abuse of process. [ 37 ] With respect to the language used in the statement of claim, the judge wrote: [39] The Cabanas not only claim the Defendants are liable to them for breach of their professional responsibilities or because of business or commercial errors, but they use strong, pejorative language to criticize and denigrate the Defendants.

I note some of their more deprecatory claims from their Statement of Claim: • [Joe] Wells conducted himself recklessly and unprofessionally… (para. 40). • [Rod] Murphy negligently misrepresented the property when…he did not disclose that the improvements to the property extending into the ocean would have required a foreshore lease from the Crown, and may be illegal… (para. 41). • [Katrina] Brannan negligently misrepresented that the property’s title was free of encumbrances to the…[Cabanas] (para. 43). • [The Cabanas] request this Court to consider whether the repeated and wanton recklessness of [John] Berghuis is sufficient to qualify as fraudulent misrepresentation… (para. 45). • [Bill] Martin fraudulently misrepresented the requirements for building into the foreshore of the property. (para. 47) • the Credit Union committed fraudulent misrepresentation… (para. 49). • [the Credit Union] … discovered that the improvements to the property were flawed and deliberately inserted an old survey so that a mortgage could be awarded.

The… [Cabanas] allege this was an actual act of fraud by the Credit Union and/or its agents”. (para. 49) [ 38 ] The Cabanas allege claims of professional negligence, negligent misrepresentation, and fraudulent misrepresentation. Most of

the passages cited by the judge do little more than name the causes of action or established elements of those causes of actions. In thecontext of legal pleadings, such language is not unusual or unduly harsh and, in my view, did not support a finding of bad faith. [39] In

summary, I would find that the judge erred in his application of the test under rule 21.01 by: failing to consider the entiretyof the pleadings; drawing improper inferences about the Cabanas’ knowledge of real property law from those pleadings; putting undueemphasis on the number of defendants named; and wrongfully impugning language the Cabanas used in the statement of claim. Further, Iam satisfied that these errors are sufficiently serious that the Cabanas’ appeal should be allowed.

ISSUE 2: Should the judge hear the trial or any further applications in this matter? [40] At the Supreme Court of Newfoundland and Labrador, this matter is subject to a case management order pursuant to rule 18A.The judge has been appointed case management judge (rule 18A.04(2)). In the ordinary course, all pre-trial applications are made to thecase management judge (rule 18A.07(1)). Additionally, the case management judge may preside at the trial of the proceeding (rule18A.09(1)). [41] This appeal being concluded, this matter will now return to the Supreme Court to proceed.

The second issue raised by theCabanas relates to whether the judge should continue to preside over the case, as case management judge or otherwise, when it does. Inmy view, he should not. [42] Public confidence in our legal system requires that judges not adjudicate on matters in which they would be subject to bias or areasonable apprehension of bias.

The test for reasonable apprehension of bias is whether an informed, reasonable and right-mindedperson, viewing the matter realistically and practically, and having thought the matter through, would conclude that it is more likely thannot that the judge, whether consciously or unconsciously, would not decide fairly. There is a strong presumption of judicial impartiality,and so grounds for the apprehension of bias must be substantial (Wewaykum Indian Band v. Canada, 2003 SCC 45, [2003] 2 S.C.R. 259,at paras. 57-60, 76-77; Cabana v.

Newfoundland and Labrador, 2014 NLCA 34, 356 Nfld. & P.E.I.R. 103, at paras. 18-21). [43] There is no hard and fast rule. Judges who have previously made findings of credibility against one of the parties, or who havepreviously determined that a claim is frivolous or vexatious, will not necessarily be disqualified from hearing further matters involvingthe same parties or claims (see Penney v. Newfoundland and Labrador, 2021 NLCA 35, 6 C.A.N.L.R. 683, at para. 9; R. v. Novak, (BCCA), at para. 7).

Whether a judge should be disqualified is a highly fact specific inquiry and will depend on thecircumstances of the case. [44] In this case, the judge found that the Cabanas’ position was untenable and insincere (para. 36), that they were not acting ingood faith in bringing their claim (para. 40), and that their claim was frivolous, vexatious and an abuse of the court’s process (para. 42).These findings relate directly to the Cabanas’ credibility with respect to their allegations and the merits of their claims against therespondents.

Although he was deciding the question that the parties had put before him, the judge has now expressed a settled view withrespect to matters that still have to be adjudicated. In these circumstances, I am satisfied that allowing the judge to continue adjudicatingin this matter would give rise to a reasonable apprehension of bias (The College of the North Atlantic v. Thorne, 2015 NLCA 47, 371Nfld. & P.E.I.R. 31, at para. 55; R. v. S. (R. D.), (SCC), [1997] 3 S.C.R. 484, at paras. 106-107). DISPOSITION [45] For the foregoing reasons, I would allow the appeal and set aside the order for security for costs.

I would also disqualify thejudge as case management judge and from adjudicating further in relation to this matter. [46] Finally, I would award the Cabanas costs on column 3 of the scale of costs in this Court and in the court appealed from. _______________________________ K.J. O’Brien J.A. I concur : _____________________________ D.E. Fry C.J.N.L. I concur : _____________________________ D.M. Boone J.A.