Security for Costs—Libel and Slander
The security for costs provisions of the "Libel and
Slander Act" do not preclude courts relying upon the
similar provisions of the "Rules of Civil
Procedure" unless there is a direct conflict between the
The main action in this case involved an insurance company,
Liberty Mutual, suing an individual, Rose Donatelli, who held
herself out as a practicing psychologist and billed the insurance
company for services to several insureds. Later, criminal
allegations surfaced that Ms. Donatelli was a fraud. The insurance
company sued Ms. Donatelli for the cost of the billed services to
its insureds. Ms. Donatelli counterclaimed for $12.5 million in
Ms. Donatelli repeatedly failed to provide required
undertakings. Liberty Mutual received costs against Ms. Donatelli
on motions pertaining to these undertakings. When these awards
remained unpaid, Liberty Mutual moved to have costs secured into
court on the counterclaim pursuant to rule 56 of the Rules
of Civil Procedure.
Ms. Donatelli appealed, citing the costs provisions of the
Libel and Slander Act. Based on paragraph 3 of
subrule 1.02(1) of the Rules of Civil Procedure and
jurisprudence, the Divisional Court held that the Libel and
Slander Act is not a complete code and that rule 56
operates to the extent that there is no conflict with the express
provisions of the Act. In this case, the Libel and Slander
Act has no provisions for an order requiring security into
court for the non-payment of costs in the same, or another,
proceeding. The appeal was dismissed.
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