Lienaux v. Campbell, 2011 NSCA 94

NOVA SCOTIA COURT OF APPEAL Citation: Lienaux v. Campbell , 2011 NSCA 94 Date: 20111012 Docket: CA 352526 Registry: Halifax Between: Charles D. Lienaux Appellant v. Wesley G. Campbell, 2301072 Nova Scotia Limited and Green Hunt Wedlake Inc. Respondents Judge: The Honourable Mr. Justice Jamie W.S. Saunders Motion Heard: October 5, 2011, in Halifax, Nova Scotia, in Chambers Held: Motion for security for costs granted. Counsel: Appellant in person Alan V.

Parish, Q.C. for the respondents Wesley Campbell and 2301072 Nova Scotia Limited Tyana Caplan for the respondent Green Hunt Wedlake Decision : This case came before me in Chambers on motions brought by the respondents to require the appellant to post security for costs in an appeal launched by the appellant from the order of Nova Scotia Supreme Court Justice Gregory M. Warner dated July 5, 2011. The respondents ’ motions are opposed by the appellant. Each party filed affidavits, exhibits, and extensive briefs in support of their respective positions.

After hearing submissions I allowed the motions with reasons to follow. These are my reasons.

As a preliminary matter, Mr. Lienaux objected to certain factual assertions contained in materials filed by Mr. Parish, and asked that I direct Mr. Parish to require the attendance of Mrs. Kim MacKay, Halifax County Registrar of Deeds, so that Mr. Lienaux could cross- examine her on a Statutory Declaration declared March 31, 2010. I refused Mr. Lienaux ’ s request as, in my view it had little to do with the merits of the narrow issue before me which was whether or not the respondents were entitled to an order for security for costs. Accordingly, I confined the parties to submissions on that single issue.

I see little point in chronicling the facts surrounding this litigation which appears to have consumed many of these parties for more than 20 years. It is enough to refer to the order of Justice Warner dated July 5, 2011, which is the subject of this appeal to get a sense of the breadth of this ongoing litigation, in its myriad forms. Here, Mr. Lienaux and four other individuals, all self-identified as being creditors in proceedings against the estate in bankruptcy of Karen L.

Turner-Lienaux (the appellant ’ s wife), appeared before Warner, J. on June 7, 2011, seeking a variety of relief which included requests that the court grant a series of declaratory judgments which would have the effect of confirming that earlier proceedings against the appellant Charles D. Lienaux and Karen L. Turner-Lienaux were void, or stayed, or subrogated, or discharged, or otherwise beyond the reach of the respondents ’ execution. After hearing counsels ’ submissions, Warner, J. dismissed the applicants ’ motions.

He then bundled the various respondents into two groups and ordered the applicants to pay costs of $2,000 forthwith, to each of those two groups. Mr. Lienaux has appealed that order and his application for leave to appeal and appeal Justice Warner ’ s decision is scheduled to be heard by a panel of this Court on January 19, 2012. Each of the respondents filed a notice of motion pursuant to Civil Procedure Rule 90.42 seeking an order compelling the appellant to post security for costs for this appeal, immediately. Mr. McFarlane, Q.C. and Ms.

Caplan appear as counsel for the respondent trustee Green Hunt Wedlake Inc. Mr. Parish appears for Wesley G. Campbell and 2301072 Nova Scotia Limited which I will refer to as the “ Campbell ” group of respondents. Each filed an affidavit with materials in support. They ask that the appellant be obliged to post $10,000 as security in respect of each of their respective interests on appeal, failing which, they would be entitled to apply to have the appeal dismissed, without further notice to the appellant.

The respondents ’ principal submission is that the appellant shows an extraordinary history of default, is quite likely “ judgment proof ” , and that without posted security the respondents would have no hope of recovering costs should they be successful on appeal. Mr. Lienaux opposes the respondents ’ motions. His affidavit and supporting materials seek to establish the arguability of the grounds he has raised on appeal as well as the difficult and precarious financial situation he currently faces. Mr.

Lienaux does not say that forcing him to post security for costs would make it impossible for him to proceed with the appeal. In fact I see that he has filed the appeal book, and as a self-represented litigant, who is also a lawyer, he will not face the burden of paying legal fees to someone else. In support of the motion for security for costs Mr. Parish, representing the Campbell group of respondents, filed the affidavit of his legal assistant, Ms. Tammy Reid, sworn September 8, 2011, which encloses a transcript of Mr.

Lienaux ’ s cross-examination by counsel at the hearing before Warner, J. on June 7, 2011, where Mr. Lienaux admits to several unpaid orders for costs. The affidavit and supporting materials filed by counsel for the trustee, confirms the various bankruptcies declared by the appellant and his wife; identifies current, unpaid judgments; and states that the costs ordered by Warner, J. following the June 7 hearing remain unpaid. I accept the very detailed brief filed by Mr. McFarlane and Ms.

Caplan on behalf of the trustee as constituting an accurate, fair and complete statement of both the facts and the law in this matter. The reader ought to have a clear understanding of the history surrounding this interminable litigation. To that end I have decided to

include their brief as an Appendix to, and therefore part of, my decision when filed. To succeed on their motion the respondents must show “ special circumstances ” as that phrase has been interpreted and applied in the jurisprudence of this province. Based on the record here, any reasonable observer, suitably informed, would surely characterize this case as one where special circumstances are self-evident. I am satisfied there is a high risk the appellant will not pay appeal costs in the event that costs are awarded in favour of the respondents in the upcoming appeal.

Without security for costs the respondents bear the sizeable risk of responding to an extensive appeal in the knowledge that none of their costs will be recoverable. None of the appellant ’ s submissions respond to, or refute, the trove of special circumstances that continue to prevail. I am not persuaded the appellant is impecunious, or that to order security for costs would stifle the action such that it would be impossible for him to proceed with his appeal.

I think it likely – based on the history of these proceedings – that the appellant will be able to access funds, post security, and carry on with the appeal. Despite past pleas of impecuniosity he has managed to fuel this litigation for decades. Had I reached the conclusion that the appellant was impecunious, or that compelling him to post security would likely terminate the appeal, I would nonetheless have ordered security for costs in favour of the respondents, so as to do justice between the parties in the face of this chronicle of discord which I would characterize as extraordinary and unparalleled.

Having satisfied the test for security for costs, the only remaining issue is quantum. Mr. Parish ’ s brief is helpful in establishing a guide based on past experience. I agree there are close similarities between this case and 2301072 Nova Scotia Ltd. v. Lienaux , 2007 NSCA 28 . There Chief Justice MacDonald, in Chambers, considered whether special circumstances existed to justify ordering security for costs against Mr. Lienaux and Ms. Karen Turner-Lienaux.

In that case, the Chief Justice noted that at the time there were a number of outstanding costs awards in favour of either Wesley Campbell or 2301072 Nova Scotia Limited. The Court found the Lienauxs ’ “ abysmal failure ” to honour previous costs orders represented exactly the type of special circumstances justifying ordering security for costs. Because this appeal involves the same parties and substantially similar issues, it is reasonable to expect that costs will be equivalent to the 2007 appeal.

In the 2007 case, the amount of security for costs was $8,000, while the costs eventually awarded at appeal totalled $10,000. Based on those comparisons and the features of this case, I set $10,000 as being a reasonable amount to order for security for costs against Mr. Lienaux, in favour of each group of respondents. To summarize, I order the appellant to post $10,000 as security for costs on this appeal in favour of the Campbell group. Further, I order the appellant to post an additional $10,000 as security for costs on this appeal in favour of the trustee.

The total security of $20,000 is to be posted on or before 4:00 p.m. local time October 21, 2011, failing which either respondent may move to dismiss the appeal, without further notice to the appellant. An order will issue accordingly. I would impose separate costs awards for this Chambers hearing of $1,600, inclusive of disbursements, payable to the (common) respondents Wesley G. Campbell and 2301072 Nova Scotia Limited as represented by Mr. Parish; and to the respondent Green Hunt

Wedlake Inc. as represented by Mr. McFarlane and Ms. Caplan, both such awards payable on or before the same deadline fixed for the posting of security for costs, that being 4:00 p.m. local time, October 21, 2011. Saunders, J.A. C:\Documents and Settings\brownc\Desktop\2011-10-13_11h50\ExtractPage1_1.jpg

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