When does the authority of an Estate Trustee During Litigation (ETDL) end?
Pursuant to section 28 of the Estates Act, the court may appoint an ETDL, “pending an action touching the validity of the will of a deceased person, or for obtaining, recalling or revoking any probate or grant of administration.” Rule 75.06(3)(f) of the Rules of Civil Procedure also expressly provides the court with the authority to appoint an ETDL on an application or motion for directions.
However, once appointed, how long does an ETDL’s authority last?
While given that “during litigation” is in the very name of the role, one might think the answer is self-explanatory, however, the Ontario Divisional Court recently had to render a decision on this very question.
In Gefen v Gefen, 2021 ONSC 1464, the Ontario Superior Court of Justice had appointed an ETDL pending the “final disposition of the counterclaim,” (involving an alleged mutual will agreement), and that the ETDL be appointed with respect to all of the property of the Estate “pending the final disposition of the Will Challenge Claim” (a claim commenced in Gefen v Gaertner).
Over the course of November 2018 to March 2019, the trial of issues, including the Will Challenge Claim, proceeded before The Honourable Justice Kimmel. On October 17, 2019 Justice Kimmel’s decision was released, which in part dismissed the Will Challenge Claim.
This decision was appealed, and question was raised regarding the ETDL’s authority – had it ceased, or did the authority continue? The ETDL, by way of his counsel, wrote to the parties confirming his understanding that his role was to continue as ETDL until the litigation was finally completed. Notwithstanding this, one of the parties attempted to list three commercial properties (that comprised a substantial part of the Estate) for sale, without notifying the ETDL.
The parties attended at a case conference on September 3, 2020, where the case management judge ordered, among other things, that the authority and jurisdiction of the ETDL be heard by a judge of the Estates List.
That motion was heard, and it was determined that the jurisprudence provided clear authority for the ETDL to continue until the litigation had finally completed. This decision was appealed to the Divisional Court.
In rendering its decision, the Divisional Court looked to the ordinary meaning of “pending”, meaning “while waiting” or “continuing” concluding that the parties were waiting for the final disposition of the Will Challenge Claim, currently under appeal. The Divisional Court agreed with the motions judge, observing that the principle that, “the duties of an Estate Trustee During Litigation continue until the litigation is finally completed, including during any appeal,” has long been established by the jurisprudence.
The Court also cited Brian A. Schnurr, Estate Litigation 2nd ed, noting that “it is clear that the duties of an administrator pendent lite continue until the litigation in respect of which he is appointed is finally disposed of. Even, as in this case where judgment is appealed his duties continue until the final appeal or disposition of the litigation.”
The Court also unequivocally held that “litigation” on a common sense application of the meaning of the term, includes an appeal to an appellate court, with litigation only ending once all appeals have exhausted.
To learn more about ETDLs, please see the below:
Thanks for reading!