In Rathod v Chijindu, 2024 ONCA 625, the moving parties brought a motion (the ”Motion”) seeking, among other things, an Order dismissing the appeal brought by the respondents concerning a decision by a lower Court in Rathod v. Chijindu et al, 2024 ONSC 939 (“939”). The moving parties submitted that the appeal should be dismissed due to the respondents’ non-payment of the costs Order in 939. At the Motion hearing, the Court of Appeal agreed, holding that the respondents were required to pay the overdue costs Order in 939 within seven (7) days.
As background, the respondents obtained substantial loans from the moving parties to finance mortgages on two properties. Following their default on these mortgages, the properties were sold via a power of sale and the net proceeds from these transactions were paid into the Court. The funds were then ordered to be distributed to the moving parties to satisfy these mortgages and the outstanding costs order in 939.
The responding parties brought a motion to set aside the decision in 939 but were unsuccessful. The Court awarded the moving party its cost for responding to same. However, the cost order lacked a specified deadline for payment.
During the Motion, the Court acknowledged that per Serra v Serra, 2007 ONCA 225, a single judge of the Court of Appeal did not posses the jurisdiction to dismiss the responding parties’ appeal. However, relying on Rule 57.03(1) of the Rules of Civil Procedure, the Court noted that costs shall be payable within 30 days of an Order, unless it is satisfied that a different Order would be more just. Specifically, the Court held “an order that is silent on the issue is to be interpreted as having imposed that deadline. “
The Court dismissed the appeal and granted an Order requiring the responding parties to comply with the outstanding costs Orders in 939 within seven (7) days, failing which the moving parties were permitted to bring a motion before a panel of judges to dismiss the appeal in its entirety.
The respondents raised objections and claimed an inability to fulfill the costs Order in 939. However, they failed to provide credible evidence to support this assertion, nor was the Court prepared to accept such arguments from the responding parties due to their previous payments into the Court for Security for Costs in the same matter. Rendering its decision, the Court of Appeal held “the responding parties must now pay the outstanding costs orders, which are overdue ─ payments which must be made, and orders complied with before they have another audience in this court for purposes of their appeal.”
The decision in Rathod v Chijindu appears to affirm that cost Orders lacking payment deadlines, absent a compelling reason, should be understood to imply a thirty (30) day repayment period. More importantly, non-compliance with a deadline may lead to a Court mandating immediate payment of any outstanding costs Orders and potentially delay Court proceedings. Continued failure to pay could further lead to a complete dismissal of an action. Parties are advised to seek legal counsel to discuss costs Orders and the implications of non-payment, especially if they intend to appeal a decision or take further steps in litigation.
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