Endurance Equipment, L.L.C. v. Teal-Jones Group

2020 BCSC 533 Endurance Equipment, L.L.C. v. Teal-Jones Group

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Endurance Equipment, L.L.C. v. Teal-Jones Group, 2020 BCSC 533 Date: 20200408 Docket: S219902 Registry: New Westminster Between: Endurance Equipment, L.L.C. Plaintiff And Teal-Jones Group, A Partnership Columbia River Shake & Shingle Ltd. Teal Cedar Products Ltd. Defendants Before: The Honourable Madam Justice Norell Reasons for Judgment Counsel for Plaintiff: R. Finlay Counsel for Defendant: D. Dalke Place and Date of Hearing: New Westminster, B.C. March 6, 2020 Place and Date of Judgment: New Westminster, B.C. April 8, 2020 [1] The defendants seek orders that: the plaintiff post security for cost in the amount of approximately $70,000 CAD; the plaintiff's action be stayed until such time as security is posted; and that if security is not posted within 21 days the defendants are at liberty to apply to dismiss the action. [2] The plaintiff Endurance Equipment, L.L.C. ("Endurance") is a company incorporated in Alabama, U.S.A. and is a manufacturer of specialized sawmill equipment. All financial figures within this judgment except the $70,000 noted above, or as otherwise noted, are in U.S. dollars. [3] The defendant Teal-Jones Group is a British Columbia general partnership between the defendant Teal Cedar Products Ltd. and its wholly-owned subsidiary, Columbia River Shake and Shingle Ltd. (collectively "Teal-Jones"). Teal-Jones

is in the business of harvesting timber and manufacturing lumber products. It operates two sawmills and a shake and shingle mill in B.C. [4] Endurance alleges that between August 2018 and January 2019 it produced various costing proposals to Teal-Jones for the manufacture and delivery of specialized sawmill equipment. Teal-Jones accepted a proposal and between September 2018 and June 2019, Teal-Jones pre-paid the sum of $1,288,763 toward the total contract price of $1,533,902. Endurance alleges that it delivered the equipment, but Teal-Jones has not paid the remaining invoices of $338,109. [5] In its defence and counterclaim, Teal-Jones alleges that the contract included installation of the equipment, that Endurance abandoned the equipment, and that there were written and oral terms regarding shipment and successful start-up dates. These dates were not met by Endurance resulting in a delay and costs to Teal-Jones. Teal-Jones also alleges the equipment was faulty. Teal-Jones counterclaims for $342,273. [6] Endurance responds that the alleged shipment and successful start-up dates were not binding terms of the contract, but are proposed payment schedules based on an estimated production and shipping schedule. Endurance also denies the equipment was faulty. Both parties have filed affidavits attesting to the merits of their claims. [7] Endurance is not extra-provincially

registered in B.C. Endurance does not own real property and does not have registered personal property in B.C. Alabama is not a reciprocating state for the enforcement of judgments under s. 37 of the Court Order Enforcement Act, R.S.B.C. 1996, c. 78. [8] The president of Endurance, Ms. Tracey Woodham, has filed an affidavit in which she swears that Endurance was incorporated in 2009 and since then has actively carried on the business of designing and manufacturing specialized sawmill equipment. The typical cost of a project is $1 million, with the largest project being $3.5 million. Endurance has an extensive customer list of North American and European forest product companies. She lists 24 of those companies. Endurance has 35 employees and for the past 11 years has operated a 40,000 square-foot manufacturing facility, which is rented from a related company. Endurance has approximately $127,000 in debt and "significant hard assets" such as manufacturing equipment and "soft assets" such as customer lists and receivables. Endurance has accounts receivable of $940,000 and she opines these are collectible. This appears to include the amount Endurance claims against Teal-Jones. Endurance has been consistently profitable for the past 10 years. The total gross revenues for the past three years is over $14 million and the total net profit just under $1.3 million. Ms. Woodham did not

attach financial statements of Endurance due to the "confidential nature" of these documents. Endurance's current cash flows are positive, which is typical for Endurance. Ms. Woodham states there is "no doubt in my view that Endurance could pay whatever award of costs were ordered". Law [9] The relevant principals are reviewed in Culp Investments LLC v. KPMG Inc., 2007 BCSC 451 [Culp Investments], which involved a foreign plaintiff from a non-reciprocating state under the Court Order Enforcement Act: [3] The court has authority to make an order for security for costs against a foreign corporation either under s. 236 of the Business Corporation Act, S.B.C. 2002, c. 75, or under its inherent jurisdiction: International Container Terminal Services Inc. v. British Columbia Railway Co., 2003 BCSC 863; Shiell v. Coach House Hotel Ltd. (1982),37 B.C.L.R. 254 (C.A.). [4] Section 236 of the Business Corporations Act provides: If a corporation is the plaintiff in a legal proceeding brought before the court, and if it appears that the corporation will be unable to pay the costs of the defendant if the defendant is successful in the defence, the court may require security to be given by the corporation for those costs, and may stay all legal proceedings until the security is given. [5] The making of an order for security for costs either under the court's inherent jurisdiction or s. 236 is

discretionary: Shiell, supra; Kropp (c.o.b. Canadian Resort Development Corp.) v. Swaneset Bay Golf Course Ltd., 4 W.W.R. 306 (B.C.C.A.). [6] The principles considered by the courts in determining whether an award for security for costs are summarized in Kropp, supra, at ¶ 17: 1. The court has a complete discretion whether to order security, and will act in light of all the relevant circumstances; 2. The possibility or probability that the plaintiff company will be deterred from pursuing its claim is not without more sufficient reason for not ordering security; 3. The court must attempt to balance injustices arising from use of security as an instrument of oppression to stifle a legitimate claim on the one hand, and use of impecuniosity as a means of putting unfair pressure on a defendant on the other; 4. The court may have regard to the merits of the action, but should avoid going into detail on the merits unless success or failure appears obvious; 5. The court can order any amount of security up to the full amount claimed, as long as the amount is more than nominal; 6. Before the court refuses to order security on the ground that it would unfairly stifle a valid claim, the court must be satisfied that, in all the circumstances, it is probable that the claim would be stifled; and 7. The lateness of the application for security is a circumstance which can properly be taken into

account. [7] The courts have always drawn a distinction between corporate and individual plaintiffs for the purposes of determining whether an order for security for costs should be made. The courts do not treat corporate defendants with the same flexibility and generosity as individual plaintiffs: Fat Mel's Restaurant Ltd. v. Canadian Northern Shield Insurance Co. (1993), 76 B.C.L.R. (2d) 231 at ¶ 27 (C.A.). [8] The courts have observed on a number of occasions that a defendant should not have to go to a foreign jurisdiction to enforce an order for costs: Alpina Equipamentos Industriais Ltda v. Bennett Environmental Consultants Ltd. (1990), 45 C.P.C. (2d) 15 (B.C.S.C.); C.W. Holdings Ltd. v. Montreal Trust Co., [1997] B.C.J. No. 398 at ¶ 19 (S.C.); Bank of Credit and Commerce International (Overseas) Ltd. (Liquidator of) v. Akbar, [1998] B.C.J. No. 2320 at ¶ 19 (S.C.). [9] The fact that the corporation is in a non-reciprocating state is a factor in favour of granting an order for security for costs: Kraft v. B.C.B.C., 2000 BCSC 1493 at ¶ 14; First Hemisphere Corp. v. Canaccord Capital Corp., [1995] B.C.J. No. 1457 (S.C.) at¶ 5. [10] The defendant's burden is limited to making out a prima facie case that the corporate plaintiff has insufficient assets in the jurisdiction to pay costs if unsuccessful at trial, unless there is no arguable defence: Kropp, supra, at ¶ 11 and 12;

Fat Mel's, supra, 16. [12] To establish that an order for security for costs will stifle an action the plaintiff must provide evidence that the corporate plaintiff is impecunious in that it has no means of raising money for security: Kropp, supra at ¶ 22. Culp Investments has not provided any evidence that an order for security would stifle its claim. [10] In Protea Consultax Inc. v. Air Canada, 2018 BCSC 995, the court stated: [5] The legal test to be applied on an application for security for costs has been set out by our courts in this way: a) the defendant must make out a prima facie case that the plaintiff would be unable to pay the defendant's costs if the plaintiff's claim fails; b) the plaintiff may resist an order for security by showing that it has sufficient assets to satisfy an award for costs, or that the defendant has no arguable defence to its claim; c) if a security is warranted, the amount is discretionary; and d) the court can consider whether an order for security would visit undue hardship on a plaintiff such that it would prevent the plaintiff's case from being heard. This has also been described as the security order "stifling" the plaintiff's claim. See also Citizens for Foreign Aid Reform Inc. v. Canadian Jewish Congress, [1999] B.C.J. No. 2160 at para.

18. Teal-Jones' position [11] Teal-Jones argues that it has established a prima facie case that Endurance would be unable to pay an award of costs because Endurance is a foreign corporation, without assets in B.C., and not resident in a reciprocating state. Although security for costs is discretionary, once an applicant has shown that a corporate plaintiff will not be able to pay costs, security is generally ordered unless there is no arguable defence: Ocean Pastures Corporation v. Old Masset Economic Development Corporation, 2016 BCCA 12 [Ocean Pastures] at para. 18. [12] There is no evidence of Endurance having any assets in B.C. Teal-Jones refers to Culp Investments at paras. 8-10, cited above, and emphasizes that the court referred to the defendant's burden being "limited to making out a prima facie case that the corporate plaintiff has insufficient assets in the jurisdiction" and that a defendant "should not have to go to a foreign jurisdiction to enforce an order for costs". Teal-Jones refers to similar comments in Aggregate Mining Process LLC v. Vezer Industrial Professional Canada Ltd., 2019 BCSC 1101 [Aggregate] at para. 21: [21] The fact that the plaintiff corporations have assets located in non‑reciprocating states is a factor that clearly favours the granting of an order for security for costs. The defendant is required to make out a prima facie case that the

corporate plaintiff has insufficient assets in the jurisdiction to pay costs if unsuccessful at trial, and that fact is tacitly acknowledged. [Emphasis added.] [13] Further, Teal-Jones argues that Endurance has not shown it has exigible assets in Alabama. Endurance has not produced its financial statements, nor described with any particularity what its "hard" and "soft" assets are. Endurance does not own the facility in which it operates, but rents it from a related company. Endurance has set up its manufacturing assets so they are not available to creditors. None of the 24 listed clients of Endurance are in Canada or B.C., and customer lists and receivable are constantly in flux. The present existence of such assets provides little comfort that Teal-Jones would be able to collect an award of costs. Endurance does not provide bank balances. [14] Teal-Jones argues that evidence that Endurance is profitable is not sufficient to avoid an order for security for costs. It refers to Forged Construction Ltd. v. Westurban Developments Ltd., 2019 BCSC 1550 at para. 19, citing para. 21 of the Master's reasons: [21] Nonetheless, security for costs has been ordered where the corporations' ability to pay costs rests solely with ongoing annual income: Citizens for Foreign Aid Reform Inc. v. Canadian Jewish Congress, [1999] B.C.J. No. 2160 at para.

18. Endurance's position [15] Endurance argues that Teal-Jones has not met the burden of establishing a prima facie case that Endurance would be unable to pay an award of costs. The test is not whether Endurance has exigible assets in the jurisdiction, and it is not sufficient for Teal-Jones to simply show that Endurance does not have assets within the jurisdiction. [16] Endurance refers to H.M.B. Holdings Limited v. Replay Resorts Inc., 2019 BCSC 771 [HMB], particularly at para.

40. This case involved foreign corporations from non-reciprocating states without assets in B.C., but with substantial assets elsewhere. Endurance argues that Teal-Jones must prove "something more" than lack of exigible assets in B.C. The court stated: [37] Given this evidence, I must ask whether the lack of exigible assets in BC is sufficient to make out a prima facie case for security for costs. The authorities are somewhat divided on this point. In Kraft v. B.C.B.C., 2000 BCSC 1493, at paras. 14 and 16, it was held that an absence of exigible assets in BC is sufficient to establish a prima facie case for security for costs unless there is evidence the plaintiff has assets in a jurisdiction with a reciprocal enforcement relationship applying to an order for costs. [38] In contrast, in Han v. Cho, 2008 BCSC 1229, and more recently in Nordgren v. Hjukstrӧm Estate, 2019 BCSC 1, it was held that lack of exigible assets within BC was not sufficient to establish a prima facie case for security for costs where the plaintiff resided out of the jurisdiction. The courts in Han and Nordgren required proof that the plaintiff was impecunious or otherwise unable to pay costs if ordered. [39] The different holdings in Kraft, Han, and Nordgren may be explained by the fact that Han and Nordgren considered individuals rather than corporations, and courts are more reluctant to order security

for costs against individuals. However, there is no obvious reason why this should be the case. The test under s. 236 of the BCA is whether the corporate plaintiff will be unable to pay the costs if ordered to do so. That is the same test considered in Han and Nordgren. [40] In my view, the law is properly set out in Han and Nordgren. The non‑resident status of a corporation and the lack of exigible assets in BC may assist in proving an inability to pay costs, but these facts, by themselves, do not establish a prima facie case of such inability. There must be something more. In the two applications before me, I am not satisfied that the applicants have proven a prima facie case of an inability to pay costs against the respondents to the application. [Emphasis added.] [17] Endurance argues that I am bound to follow HMB unless I have reason not to within the exceptions in Re Hansard Spruce Mills, [1954] B.C.J. No. 136 [Re Hansard Spruce Mills]: Therefore, to epitomize what I have already written in the Cairney case, I say this : I will only go against a judgment of another Judge of this Court if : (a) Subsequent decisions have affected the validity of the impugned judgment; (b) it is demonstrated that some binding authority in case law, or some relevant statute was not considered; (c) the judgment was unconsidered, a nisi prius judgment given in circumstances familiar to all

trial Judges, where the exigencies of the trial require an immediate decision without opportunity to fully consult authority. If none of these situations exist I think a trial Judge should follow the decisions of his brother Judges. [18] Endurance argues that the statements in HMB are not inconsistent with other case authorities because HMB does not state what "something more" is. [19] In the alternative, Endurance argues that even if Teal-Jones has established a prima facie case, Endurance has adduced evidence that it is able to pay a costs award. Ms. Woodham has provided the financial information she can without disclosing confidential financial statements, and the evidence is sufficient. Ms. Woodham was not cross-examined on her affidavit. Endurance refers to comments in Moneywise Financial Inc. v. Key Life WCF Financial Inc., 2018 BCSC 1789 [Moneywise] at para. 51-57 where the court accepted evidence that was not supported by financial statements: [52] Although the evidence tendered by the plaintiff concerning its financial resources was not supported by financial statements or other confirmatory documents, Mr. Wise has not been challenged or cross-examined on his affidavit evidence. It was open to the defendants to cross-examine Mr. Wise on his affidavit if they wished to impugn his sworn evidence concerning the plaintiff's resources and solvency. I am not prepared to

infer that he was being untruthful. Thus, although his evidence is not well supported, it is not contradicted in any way and I accept Mr. Wise's assertions concerning the plaintiff has substantial assets that could be called upon to discharge its obligations for any costs award. [20] Endurance refers to similar comments in Forged Construction Ltd v. Westurban Developments Ltd., 2019 BCSC 1550 at para. 19 and 21, citing the Master's reasons at para. 18, where affidavit evidence was not challenged by cross-examination. [21] Endurance also argues that it is not necessary to have exigible assets, and that a positive cash flow of funds that are available may be sufficient to prove ability to pay an award of costs: Sunstone v. Vancouver Pacific Development Corp., 2015 BCSC 261 at para. 22. [22] Finally, Endurance argues it has a strong case. The equipment was delivered and installed and Teal-Jones is using it. Endurance's action is a straight-forward debt claim for outstanding invoices. Endurance argues that Teal-Jones' application is tactical in nature and its defence and counterclaim have little merit. Teal-Jones went to Alabama to seek a proposal from Endurance. Teal-Jones initiated and entered into a contract with a non-resident corporation. Endurance has not chosen to come to B.C.; it has been forced to do so because of Teal-Jones' non-payment. Teal-Jones' counterclaim has

turned a simple debt claim into a complex counterclaim which Teal-Jones estimates will take 15 days. Security for costs is protection for the costs to defend a claim, not to prosecute a counterclaim, and if the court is inclined to award any security, it should be reduced to reflect only defence costs. Teal-Jones' reply arguments [23] Teal-Jones argues that the decision in HMB is anomalous and conflates the test for security for costs applied to natural persons with the test applied to corporations. The court's statement in para. 39 that the test should be the same is inconsistent with the long-standing different approach courts have taken with respect to natural persons and corporations on applications for security for costs. The distinction and the policy reasons for this were referred to in Han at paras. 20-27; Kropp v. Swaneset Bay Golf Course Ltd. (1997), 29 BCLR (3d) 252 (C.A.) at paras. 11 and 16; and Ocean Pastures at paras. 18-21 and 27. Further, HMB is inconsistent with this court's decision in First Hemisphere Corp. v. Canaccord Capital Corp., 1995 B.C.W.L.D. 1937, 1995 CanLII 2788 (S.C.) where the court stated: 5 The plaintiff cited Riedel International Inc. v. B.C. (1991), 1991 CanLII 452 (BC SC), 53 B.C.L.R. (2d) 110 as authority for the proposition that the fact that the plaintiff is a non-resident corporation with no assets in the jurisdiction is insufficient to justify an award for security for costs. Riedel is distinguishable from these facts, however, because it was concerned with a reciprocating state under the Court Order Enforcement Act, R.S.B.C. 1979, c.

75. In the case at bar, the plaintiff corporation was incorporated in the British Virgin Islands, and has offices on the Isle of Man, neither of which has a reciprocal relationship with British Columbia. [24] Teal Jones' argues that HMB is not binding on this court. Referring to the exceptions in Re Hansard Spruce Mills, it argues that: HMB is inconsistent with Culp Investments, which was decided before it, and Aggregate which was decided after it; the court in HMB did not consider the BC Court of Appeal decision in Ocean Pastures which distinguishes between the test for personal and corporate plaintiffs; and there was not an in-depth analysis by the court, referring to only three decisions, two of which concerned individual plaintiffs. Analysis [25] The two main issues are whether Teal-Jones has established a prima facie case that Endurance will be unable to satisfy an award of costs, and if so whether Endurance has shown that it has exigible assets, and therefore is able to satisfy an award. [26] Much of the argument in this case concerning HMB can be resolved by a recognition that an order for security for costs is a discretionary order and each case, like HMB, is decided on its own facts. As stated by Mr. Justice Armstrong in Moneywise, in the absence of other evidence, a prima facie case is ordinarily established when the defendant shows the plaintiff does not have

exigible assets: [38] In this case, I am primarily concerned with the nature and quality of evidence necessary to establish: a. if the defendants have shown the plaintiff appears unable to pay the defendants' costs if ordered; and b. whether the plaintiff has shown that it has sufficient exigible assets to satisfy an award for costs. [39] The only evidence supporting the defendants' application derives from Land Title Office searches which show that the plaintiff does not own real property and Personal Property Security Registry searches indicating the plaintiff has no secured interests in any personal property. Ordinarily, in the absence of other evidence, the results of those searches satisfy the conclusion that prima facie, the company appears unable to pay a costs order. [Emphasis added.] [27] Moneywise involved B.C. corporations. The statements in Culp Investments and Aggregate, which both involved foreign corporations in non-reciprocating states, with no assets in B.C., are consistent with this. In those cases, there would be a stronger argument that a prima facie case is established. Of course, that is only the beginning of the analysis, because the court must go on to consider all other relevant factors in the exercise of its discretion. [28] Turning to HMB, at para. 38, the court refers to requiring proof of inability to pay costs. At para. 39, the court states there

is "no obvious reason why" individuals should be considered differently than corporations with respect to security for costs. It may be the court is only referring to the requirement of proof of inability to pay. That is always required. However, if as argued by Teal-Jones, this is intended to be a broader statement with respect to treating individual persons and corporate plaintiffs the same with respect to security for costs, and which statement forms the basis of the court requiring "something more", I respectfully disagree. The decision of the BC Court of Appeal in Ocean Pastures is to the contrary and is binding. The courts have drawn a distinction between personal versus corporate plaintiffs with respect to applications for security for costs. For personal plaintiffs, the defendants must show special circumstances because of the concern not to thwart access to the courts. That has not been a requirement for corporations, who have chosen to structure their affairs to operate with limited liability. However, the inability for a corporation to bring an action may still be a factor, along with all other relevant factors, that is considered by the court in exercising its discretion. [29] The court in HMB then states in para. 40 that "the lack of exigible assets in B.C. may assist in proving an inability to pay costs, but these facts, by themselves do not establish a prima

facie case of such inability". The court then states "something more" must be proven. It may be the court's comment regarding "something more" is referring to the particular facts of that case where there were corporate parties resident in non-reciprocating states, but where those parties had substantial assets. If, as argued by Endurance, it is a broader binding statement of principle that non-resident status and lack of exigible assets in the jurisdiction cannot be sufficient to establish a prima facie case, then I respectfully disagree because a security for costs order is discretionary and all other relevant factors are considered. As stated by Mr. Justice Armstrong in Moneywise, in the absence of other evidence, the lack of exigible assets will ordinary lead to a finding of a prima facie case, which then may be rebutted by evidence from the defendant. As stated by Madam Justice Gerow in Culp Investments, the fact that the plaintiff is also in a non-reciprocating jurisdiction is another factor that would support a finding of a prima facie case. [30] Turning to the facts of this case, in my view Teal-Jones has established a prima facie case that Endurance is unable to pay an award because it is a non-resident corporation, that does not have assets in the jurisdiction, and it is not resident in a reciprocating state. [31] The evidence of Ms. Woodham is insufficient to

establish with any confidence that Endurance will be able to satisfy an award of costs. I conclude this for the following reasons. a) Endurance did not provide any financial statements. No explanation was given as to what information was confidential and why it could not be produced on appropriate undertakings; b) Endurance does not appear to have any real property. The statement that it has "substantial hard assets" does not answer what these assets are, what their value is, or whether they are encumbered; c) the statement that Endurance has "soft assets" is not of assistance. Customer lists are not exigible; d) the figures given for income and debts again leave more questions than answers. For example, the income figure is an aggregate over three years. The individual years could show growing, decreasing or erratic income. It is simply unknown; e) it appears that Endurance has structured its affairs with a related company so that it does not own the facility where it works; f) statements regarding current receivables and payables are too dynamic to rely upon without financial statements; and g) although Endurance is said to have income in Alabama, that does not make it attachable in B.C. [32] In coming to this conclusion, I acknowledge that Teal-Jones did not seek to cross-examine Ms. Woodham and that there are cases where the court has accepted affidavit evidence without

financial statements. I also acknowledge there are cases where despite a lack of exigible assets the court refused to order security because the plaintiff had income. However, each case depends on the particular facts. For example, in Moneywise, where there were no financial statements produced, but there was evidence of $35 million dollars in real estate in related companies. [33] The court may review the merits of the claim, but should refrain from going into details unless success or failure is obvious. Reviewing the affidavits, it is impossible to determine the relative merits of the claims of Endurance and Teal-Jones. Both raise triable issues. Neither claim appears to be obviously destined to succeed or conversely doomed to fail. The action is in the initial stages. No examinations for discovery have taken place and the parties have only exchanged initial lists of documents. I therefore consider the respective merits of the claims to be a neutral factor. I find no reason to conclude on the evidence before me that the counterclaim is a "tactic" as alleged by Endurance. [34] Endurance does not argue it is not capable of posting security or that an order would stifle its ability to bring the claim. It argues that it is a solvent company. In the circumstances, I conclude that it will not be significantly prejudiced by an order for security for costs. [35] Endurance argues it

has a simple debt claim and it should not have to post security for a complicated counterclaim. Neither counsel referred to any of the case authorities which consider this issue. I have considered the following factors. Endurance has provided the equipment and there is no evidence that it is not being currently used by Teal-Jones. Even if there is a successful counterclaim, if Endurance is successful in any of its claim against Teal-Jones, there would potentially be a fund of money available for Teal-Jones to use toward costs. However, if Endurance is not successful in its claim, and Teal-Jones is successful then there does not appear to be exigible assets which could be used to satisfy an award for costs. The claim and counterclaim are intertwined, and the facts pleaded in support of the defence and set-off are the same as those pleaded as part of the counterclaim, but there are aspects of the counterclaim, for example lost opportunity costs that in my view are distinct from a defence. There is an overlap in the costs Teal-Jones will likely incur in advancing its counterclaim and its defence. If failure to post security results in Endurance's action being stayed, it would appear unjust to allow Teal-Jones to continue with its counterclaim arising out of the same events. [36] Considering all of the factors, I conclude that this is an appropriate case to require Endurance to

post security for costs, but not at the amount claimed. I have reviewed the draft bill of costs presented. In my view, some of the items claimed are more than what might be awarded. I am also not persuaded this will necessarily be a three-week trial, or that significant expert evidence will be required. I have also considered the above factors regarding the costs of prosecuting a counterclaim which may be not incurred in the defence. The court has discretion, acting judicially, to order an amount that it considers appropriate. I therefore reduce the amount and order that the sum of $40,000 CAD be posted by Endurance as security for costs within the next 45 days. This can, by agreement, be held in one of the trust accounts of counsel, or paid into court to the credit of this action. The action is stayed until those funds are posted. In the event the funds are not posted as security within 45 days, Teal-Jones is at liberty to apply for dismissal of the action. "Norell J."