Yaiguaje v. Chevron Corporation  ONCA 827 (October 31, 2017)
Court of Appeal for Ontario
Ecuadorian community members filed an action in Canada for recognition and enforcement of an Ecuadorian court judgment holding Chevron accountable for environmental harm from petroleum development in the Amazon. The Superior Court of Justice granted Chevron’s motion for summary judgment and dismissed the plaintiffs’ claim against Chevron (Yaiguaje v. Chevron Corporation  ONSC 135).
The community members appealed and Chevron filed a motion seeking nearly CAN$1 million in security for costs of the proceeding and appeals. A motion judge granted the motion, finding that the community members had not established they were impecunious or that their claim had a good chance of success. Para. 15 (summarizing lower court decision).
The Court of Appeal outlined the standard for deciding motions for security for costs, stating: “judges are obliged to first consider the specific provisions of the Rules governing those motions and then effectively to take a step back and consider the justness of the order sought in all the circumstances of the case, with the interests of justice at the forefront.” Para. 22. The Court cautioned: “Courts must be vigilant to ensure an order that is designed to be protective in nature is not used as a litigation tactic to prevent a case from being heard on its merits, even in circumstances where the other provisions of [the rules] have been met.” Para. 23.
Recognizing that the community members were bringing public interest litigation that does not financially benefit them directly, the novel nature of the claim, and Chevron’s considerable revenues, the Court of Appeal set aside the security order.