PRACTICE
Costs
Foreign plaintiffs—Defendants moving for order for security for costs under Federal Courts Rules, r. 416 to be paid by plaintiffs, North Dakota towns, cities—Plaintiffs in main proceeding claiming defendants liable for flooding damage caused by construction, maintenance, operation of dike on Canadian side of international border, requiring defendants to remove dike, re-establish land to prairie grade—Issue whether Court’s discretion under Rules, r. 416 should be exercised in favour of defendants—Plaintiffs ordinarily residing outside Canada, having no assets in Canada—Both Government of Manitoba, municipal defendants stand to incur substantial fees, disbursements in defending action; draft bill of costs estimating Manitoba’s legal fees at $176,335.20, disburse-ments of $80,000; similar amount claimed by municipal defendants—Security for costs under Rules, r. 416(1) not automatic entitlement; Court retaining discretion to deny request where defendant in no real jeopardy of recovering costs—Motion denied—Plaintiffs having special status as action brought under International Boundary Waters Treaty Act—Treaty providing foreign resident with same rights, in relation to international boundary waters, as if person resident in Canada—Act, s. 4(1) providing plaintiffs having same rights, remedies as if property, undertakings damaged by actions of defendants located in Canada—Claimants should therefore be accorded equal treatment with respect to access to courts of justice within territory of other party, in all degrees of jurisdiction, both in pursuing, defending rights—Rules, r. 416 ought therefore not work to plaintiffs’ disadvantage or be interpreted to plaintiffs’ prejudice—Existence of reciprocal enforcement legislation significant factor militating in favour of plaintiffs: Greensteel Industries Ltd. v. Binks Manufacturing Co. of Canada Ltd. (1982), 35 O.R. (2d) 45 (C.A.)—Evidence plaintiffs having sufficient assets to pay defendants’ costs; having ability to raise necessary funds through levies, taxation—Finally, in lieu of security for costs, plaintiffs have offered to undertake to pay any judgment for costs awarded to defendants herein, without necessity of defendants having to commence proceedings in State of North Dakota, and to file formal undertaking satisfactory to Court—Proposal reasonable, as contractually binding plaintiffs to pay any judgment order to be paid, preventing governmental immunity to be raised as bar to recovery—Plaintiffs exempted from requirement to post security for costs, conditional upon filing of satisfactory undertaking—Federal Courts Rules, SOR/98-106, rr. 1 (as am. by SOR/2004-283, s. 2), 416—International Boundary Waters Treaty Act, R.S.C., 1985, c. I-17, s. 4(1).
Pembina County Water Resource District v. Manitoba (T-745-04, 2005 FC 1226, Lafrenière P., order dated 8/9/05, 9 pp.)