Background: IMH 415 & 435 Michigan Apartments Ltd., IMH Pool XIV LP, and IMH GP XIV Ltd. (the plaintiffs) filed a claim against Unique Restoration Ltd. (the defendant) concerning renovation work on apartment buildings in Victoria, BC. The plaintiffs alleged that Unique Restoration Ltd. caused asbestos contamination during the project, leading to significant delays and damages.

Legal Issues: The plaintiffs sought security for costs totaling $128,240, arguing that Unique Restoration Ltd., which had become insolvent and filed a Proposal under the Bankruptcy and Insolvency Act, lacked the funds to cover litigation costs if their counterclaim failed. Unique Restoration Ltd. counterclaimed for unpaid invoices, valued at approximately $2.4 million, and sought relief under the Builders Lien Act.

Court's Analysis: The court considered whether Unique Restoration Ltd. could pay the plaintiffs' legal costs if its counterclaim failed. It was determined that Unique had no significant assets and that requiring security for costs at this late stage would unfairly prejudice the defendant and likely delay the trial.

Conclusion and Costs: The court dismissed the plaintiffs' application for security for costs. Unique Restoration Ltd. was awarded its costs for the application, although the specific amount was not detailed in the document.