Category: Litigation

19 Feb

The Latest ONCA Pronouncement on Will Challenges

Doreen So Capacity, Estate & Trust, Litigation, Uncategorized, Wills Tags: , , , 0 Comments

 

Another will challenge was before the Court of Appeal this month on February 5, 2019.  Reasons for the panel, comprised of Pepall, Trotter, and Harvison Young JJ.A., were released in writing on February 13th.  Quaggiotto v. Quaggiotto, 2019 ONCA 107, can be found here.

The issue of validity was solely focused on a codicil that was executed by Maria Quaggiotto when she was 87 years old.  The codicil left the residue of her estate to one son, Livio, while her will had previously left an equal division of the residue to both of her sons, Livio and Franco.

After a 10 day trial, Justice Rogin found that the codicil was valid.

On appeal, the challenger Franco sought to overturn various findings of fact and findings of mixed fact and law.

Ultimately, the panel upheld the decision of Justice Rogin.

The panel reaffirmed the Court of Appeal’s decision in the Orfus Estate with respect to the notion that testators are not required to have “an encyclopedic knowledge” of their assets in order to satisfy the test for testamentary capacity.

Interestingly enough, the Court of Appeal found that the trial judge was sufficiently alive to corroboration requirements of section 13 of the Ontario Evidence Act even though Justice Rogin’s decision would appear to have erroneously cited section 13 of the Ontario Estates Act for this important statutory requirement.  The adage “form over substance” did not hold water in this appeal given that the actual legal requirement was adequately considered by Justice Rogin.

Thanks for reading!

Doreen So

14 Feb

Elder Law Litigation Needs to Increase?

Natalia R. Angelini Elder Law, Litigation Tags: , , 0 Comments

In the last couple of decades we have seen a rise in estate, capacity and trust litigation due in large part to the aging demographic.  One would think that elder law disputes – disputes involving retirement residences, nursing homes and/or long-term care facilities – would similarly be on the rise.  What was highlighted for the attendees at a recent Personal Injury and Elder Law CLE presentation, however, is that there is limited case law in the elder law area. Although the knee-jerk reaction may be to see few cases litigated through to a final hearing as a positive state of affairs, that is not so. Rather, it seems that there are an insufficient number of claims being made, and an even fewer number that are pursued all the way to trial.

The panel sees ageism as contributing to this set of circumstances. Damage awards are typically lower for the elderly, the rationale seemingly that they have already lived most of their lives and are going to die anyway. The converse “Golden Years Doctrine” was cited as a means to argue for the better protection of elderly plaintiffs, grounded in the argument that the elderly suffer more and are more severely impacted from an injury than their younger counterparts.

Taking such cases to trial and increasing awareness (e.g. media coverage) is a way to create progress and change in this area of the law. The panel advocated for this approach, as well as stressed the importance of electing to have such cases heard in front of a jury, who may be more willing to award larger sums to litigants.

If this advice is followed, we can hope to see more decisions that can build upon the few noted cases in the area (this article references some of them), and more just outcomes for the elderly, their families and/or their estates.

Thanks for reading and have a great day,

Natalia R. Angelini

12 Feb

Can Typography Expose a Sham Trust?

Natalia R. Angelini Estate & Trust, Litigation, Uncategorized Tags: , , 0 Comments

In estate litigation it is not uncommon to have reason to engage handwriting experts to attest to the authenticity of a signature on a testamentary document. However, the need to engage a typography expert to speak to the font used on such a document is a much rarer occasion. In McGoey (Re) such an expert was used to expose a sham trust.

In this case, upon Mr. McGoey’s assignment into bankruptcy, the trustee in bankruptcy sought to realize on the assets, seeking a declaration that Mr. McGoey’s interest in two properties held jointly with his wife were assets of the estate and subject to creditor claims. Mr. McGoey and his wife argued that they held title to the properties in trust for their children and, thus, outside the reach of creditors. They asserted that the trust documentation was executed in 1995 for one property and in 2004 for the other.

Upon examination by a typography expert, it was revealed that the dates of execution of the documents were not accurate, as neither Cambria (the typeface on the 1995 document), nor Calibri (the typeface on the 2004 document), were available for use by the general public until 2007. The court accepted the expert’s evidence. However, the issue was not fully resolved, since Mr. McGoey’s financial predicament was not apparent until 2010. He and his wife may have lawfully created trusts for their children between 2007 and 2010.

The court turned its scrutiny to the other circumstances of the case. Although several red flags or “badges of fraud” were found and are cited in the decision, most notable was the fact that nothing distinguished the McGoey’s use of the properties from that of an owner – they used the properties as they desired, encumbered them when they wanted and described themselves as the owners in legal papers. Accordingly, the court concluded that the trusts were shams.

Although both the expert testimony and the surrounding circumstances contributed to the court’s ruling, it seems the evidence of the typography expert would have been definitive on the question had the factual timeline been different. I expect with the ongoing creation of new fonts that we can expect to see increased use of such expert testimony in estate litigation.

Thanks for reading and have a great day,

Natalia R. Angelini

05 Feb

Hull on Estates #565 – The Supreme Court of Canada on Henson Trusts

76admin Estate & Trust, Litigation, Podcasts Tags: , , , , 0 Comments

This week on Hull on Estates, Natalia Angelini and Nick Esterbauer discuss S.A. v Metro Vancouver Housing Corp., in which the Supreme Court of Canada addresses Henson trusts for the very first time.

Should you have any questions, please email us at webmaster@hullandhull.com or leave a comment on our blog.

Click here for more information on Natalia Angelini.

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29 Jan

House Explosion Leading to Questions of Ownership and Ultimately, Responsibility Under the Law

Kira Domratchev Litigation, Uncategorized Tags: , , , , , , , , 0 Comments

Paul Zigomanis (“Paul”) died on April 20, 2015 as a result of an explosion that destroyed the home he lived in for 24 years (the “Brimley House”). At the time of Paul’s death, title to the Brimley House was in the name of Paul’s parents, John Zigomanis (“John”) and Mary Zigomanis (“Mary”).

A passerby who was driving by the Brimley House at the time of the explosion, and impacted by it, brought an action for negligence and under the Occupiers’ Liability Act as against Paul’s Estate and John’s Estate (Zambri v Cooperman, 2018 ONSC 7679). A motion was brought by the Estate Trustee During Litigation of Paul’s Estate, Jonathan Cooperman, (the “ETDL”) to determine whether the Brimley House was an asset of Paul’s Estate or John’s Estate, as this was an important issue that had to be determined before the litigation could proceed (Zigomanis Estate, 2017 ONSC 6855).

As there were more assets in John’s Estate, than in Paul’s Estate, the interested parties in the litigation would suffer an adverse consequence were it determined that the Brimley House properly belonged in Paul’s Estate.

The primary position of the ETDL was that a trust relationship was established between Paul’s parents and Paul, whereby a resulting trust arose between John and Mary and Paul and that title to the Brimley House “resulted back” to Paul upon John’s death on December 31, 2014.

Facts

On December 31, 1990, John and Mary took title as joint tenants to the property where the Brimley House was eventually built on, for $270,000.00, as joint owners. In May, 1991, Mary and John signed a deed transferring the Brimley House to Paul for “natural love and affection”. The Court found that Paul ultimately paid John and Mary $140,000.00 for the Brimley House. It was further held by the Court that the family understood that John and Mary were always going to help Paul to purchase a home.

After moving into the Brimley House, Paul developed a drug addiction. Thereafter, on August 1, 1996, Paul transferred the Brimley House to Mary and John for $2.00. Mary and John put all the insurance, taxes and utility bills into their names and had the bills sent to their own home, however, Paul would transfer $500.00 per month to them for the payment of these expenses. It was understood by the family that this was done in order to protect the Brimley House from the potential repercussion of Paul’s substance abuse problems.

Mary died on March 23, 2013, leaving her Estate to John, who at the time suffered from dementia. Shortly thereafter, Gail MacDonald (“Gail”) and Violet Cooper (“Violet”), Paul’s sisters, who were managing John’s affairs, realized that Paul stopped making regular payments to their parents towards the Brimley House and offered to have the Brimley House transferred to Paul, immediately. Importantly, this letter was written well before the explosion giving rise to the litigation, took place.

John died on December 31, 2014, leaving his Estate to Gail, Violet and Paul, equally. Gail was named as the Estate Trustee of John’s Estate. Before Paul’s death, Gail, through her counsel, and Paul, through his counsel, were engaged in settlement negotiations with respect to the Brimley House. The draft minutes of settlement exchanged included the following: “AND WHEREAS Mr. Zigomanis asserts that the Brimley Road property was transferred to the Deceased to be held in trust for the benefit of Mr. Zigomanis”. The Court held that this particular piece of evidence was indicative of the fact that it was always understood by the family that Paul was the beneficial owner of the Brimley House.

Paul died intestate and he did not have a spouse or any children. His beneficiaries were Gail and Violet, and the sole beneficiaries of his Estate.

Analysis and Decision

 

The Court was satisfied that, on a balance of probabilities, and in considering all of the evidence, John and Mary transferred both legal and beneficial title to the Brimley House to Paul in 1991, for valuable consideration. As such, no presumption of a resulting trust applied to this transaction.

The Court further held that the nominal consideration for which Paul transferred the Brimley House to John and Mary triggered the presumption of a resulting trust, such that the Court had to determine what Paul intended at the time of the 1996 transfer.

Based on the evidence considered, the Court found that the presumption of a resulting trust could not be rebutted, such that Paul was the true owner of the Brimley House, because John and Mary intended to transfer the legal title back to Paul, once they were reassured in his ability to control ownership. As a result, the Brimley House was ordered to be returned to the trustee of Paul’s Estate, effective January 1, 2015, being the following day after the death of John.

John’s Estate’s Liability in the Litigation Related to the Explosion

Following the Court’s finding regarding the ownership of the Brimley House, Gail, as trustee of John’s Estate brought a motion for an order that John’s Estate did not owe a duty of care to the Plaintiff and was not liable under the Occupiers’ Liability Act.

The Court held that a relationship between the Plaintiff, a passerby, and John’s Estate, a non-owner of property, is not one in which a duty of care had previously been recognized. The Court further held that although John had some involvement with the Brimley House, it would not be a sufficient basis to find a relationship of proximity with the Plaintiff that would give rise to a duty of care.

Based on the above findings, the Court held that John’s Estate did not owe a duty of care to the Plaintiff and there was no other legal or equitable basis to find that John’s Estate had an obligation to manage the Brimley House on behalf of or to supervise Paul’s behaviour, including any liability under the Occupiers’ Liability Act.

Thanks for reading!

Kira Domratchev

Find this blog interesting? Please consider these other related posts:

Legal vs. Beneficial Ownership – Not so easily distinguished?

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It All Comes Down to Intent

22 Jan

Hull on Estates #564 – When Can a Trustee Claim, and Justify, a Special Fee?

76admin Estate & Trust, Estate Planning, Litigation, Podcasts Tags: , , , , , 0 Comments

In today’s podcast, Noah Weisberg and Rebecca Rauws discuss executor and trustee compensation, and particularly the circumstances in which a trustee may be able to claim a special fee. This topic was also discussed in a recent paper by Lisa Toner, “When Can a Trustee Claim, and Justify, a Special Fee?”

Should you have any questions, please email us at webmaster@hullandhull.com or leave a comment on our blog.

Click here for more information on Noah Weisberg.

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21 Jan

Limitation Periods and Special Circumstances: Discoverability under the Trustee Act

Garrett Horrocks Executors and Trustees, Health / Medical, Litigation, Trustees Tags: , , , 0 Comments

Section 38 of Ontario’s Trustee Act provides that an estate trustee may commence or maintain, on behalf of a Deceased individual, an action in tort that could otherwise have been commenced by that individual.  As discussed in related blogs on this section, such actions are ordinarily subject to a stricter limitation period than that of other civil claims.

In typical civil claims, Ontario’s Limitations Act imports a two-year limitation period which begins to run as of the date the cause of action was discovered.  The limitation period under the Trustee Act, however, begins to run as of the Deceased’s date of death and is not subject to this principle of discoverability, unless the Plaintiff can satisfy the Doctrine of Special Circumstances.  The decision in Graham Estate v Southlake Regional Health Centre recently contextualized this Doctrine and, in so doing, suggests that the principle of discoverability will not always be dispensed with.

The Facts

In May 2008, the Deceased in Graham Estate underwent a botched surgical procedure that ultimately gave rise to a claim in medical negligence.  The Deceased subsequently died in February 2009, and a claim was commenced by the Deceased’s Estate in May 2010, well within the two-year limitation period under section 38(3).

As part of this initial claim, the Estate obtained disclosure of relevant medical records relating to the operation.  In or about 2015, more than four years after the limitation period had expired, counsel for the Estate subsequently received an additional unprompted cache of records that had not been previously disclosed.  This new set of records gave rise to a claim against a party who was not a party to the existing litigation.

In February 2017, the Estate subsequently brought a motion seeking to add the Proposed Defendant as a party to the litigation.  At issue in this decision was whether the Estate was out of time as a result of the strict operation of section 38(3) of the Trustee Act.  The Court ultimately held that the Estate ought to succeed on the basis of the Doctrine of Special Circumstances.

Special Circumstances

As the claim against the Proposed Defendant was, on its face, out of time, the Estate argued that the Doctrine of Special Circumstances ought to apply.  This Doctrine is comprised of a two-step test to be satisfied by the Plaintiff:

  1. The Plaintiff must rebut the presumption of prejudice that would result to the party to be added; and
  2. The Plaintiff must satisfy the Court that special circumstances justify the addition of that party.

At the outset, the Court held that the loss of a limitation defence immediately gave rise to a presumption of prejudice in favour of the Proposed Defendant.  However, the Estate identified a number of factors that operated to rebut the presumption of prejudice, notably:

  1. The claims to be made against the Proposed Defendant were identical to those already commenced against the existing Defendants;
  2. The action against the Proposed Defendant was tenable in law; and
  3. There would be no procedural unfairness to the Proposed Defendant if he were added as a party, as no trial date had been set and he would have sufficient time to prepare a defence.

The Court then considered whether there were any equitable special circumstances that merited the addition of the Proposed Defendant as a party.  As above, the Court held that there were, but in so doing, in effect considered factors not unlike the discoverability principle.

Chiefly, the Court noted that the Proposed Defendant’s role in the circumstances giving rise to the initial negligence claim had not become apparent until the limitation period had already expired.  The Court found that the Estate had made efforts to obtained the relevant records well within the limitation period, and that the records implicating the Proposed Defendant had erroneously been omitted.  The Court held that this was not a case in which the Estate was “handicapped by its own inaction.”

While section 38(3) of the Trustee Act on its face imports a strict limitation period, the Graham Estate decision nonetheless suggests that the courts will consider discoverability, among other factors.  That said, this analysis is only engaged if the presumption of prejudice is rebutted.

Thanks for reading.

Garrett Horrocks

08 Jan

Hull on Estates #563 – Styres v Martin

76admin Estate & Trust, Hull on Estates, Litigation, Podcasts Tags: , , 0 Comments

In today’s podcast, Jonathon Kappy and Sayuri Kagami discuss the recent Court of Appeal decision in Styres v Martin, 2018 ONCA 956, where the Court ordered a new trial of the issues. The Appellant had suffered catastrophic brain injuries after a motorcycle accident and subsequently entered into a long-term relationship with the Respondent to whom he eventually transferred his home. On Appeal, the Court of Appeal examined some of the important issues that need to be examined in such a matter.

Should you have any questions, please email us at webmaster@hullandhull.com or leave a comment on our blog.

Click here for more information on Jonathon Kappy.

Click here for more information on Sayuri Kagami.

03 Jan

Can a Non-Party Attend and Assist Counsel at an Examination?

Noah Weisberg Litigation Tags: , , , , , 0 Comments

The Rules of Civil Procedure govern examinations for discovery.  Silent though, is when a non-party will be permitted to attend an examination for discovery and assist counsel.  The answer can be found in case law.

An examination for discovery is not a public hearing, and as such non-parties cannot simply show up like they can at court.  Instead, the party seeking the non-party’s attendance and assistance must either get the consent of counsel or permission from the court.

Master Dash in Poulton v. A&P Properties Ltd., set out the following governing principles:

  1. since a cross-examination on an affidavit is not a public hearing, a non-party may attend to assist a party only on the consent of the other side or on the order of the court;
  2. the onus is on the party seeking such an order to prove entitlement to it;
  3. the non-party should not be a witness at the subsequent trial;
  4. the attendance of the non-party must not disrupt the examination process;
  5. the non-party must not take the role of witness or assist the witness is answering questions; and
  6. a court in exercising its jurisdiction as to whether to allow the presence of a non-party must do so having regard to both substantive fairness to the parties and the appearance of fairness.

While every case will turn on the specific facts, it appears that generally speaking experts may attend to assist with technical and complex evidence (although they cannot later be an expert witness at trial), as well as a resource person or expert assistant who is familiar with a file in a document-intensive case.

Noah Weisberg

Find this blog interesting, please consider these other related blogs:

27 Dec

Can Limitation Periods be Extended for Estate Trustees?

Rebecca Rauws Litigation Tags: , , , , , , , , , , 0 Comments

A recent decision of the Ontario Court of Appeal considered whether s. 7 of the Limitations Act, 2002 applies to extend the time within which an estate trustee can bring a claim that arose prior to a deceased person’s death.

Section 7 of the Limitations Act, 2002 provides as follows:

Incapable persons

7 (1) The limitation period established by section 4 does not run during any time in which the person with the claim,

(a) is incapable of commencing a proceeding in respect of the claim because of his or her physical, mental or psychological condition; and

(b) is not represented by a litigation guardian in relation to the claim.

Presumption

(2) A person shall be presumed to have been capable of commencing a proceeding in respect of a claim at all times unless the contrary is proved.  2002, c. 24, Sched. B, s. 7 (2).

Extension

(3) If the running of a limitation period is postponed or suspended under this section and the period has less than six months to run when the postponement or suspension ends, the period is extended to include the day that is six months after the day on which the postponement or suspension ends.

In Lee v Ponte, 2018 ONCA 1021, the estate trustee of the deceased person commenced a claim more than 2 years after the date on which the limitation period began to run, as determined by the trial judge. As a result, the action was statute barred.

The estate trustee appealed, taking the position that section 7 of the Limitations Act, 2002 should be “liberally construed”. The estate trustee argued that a deceased person is incapable of commencing a proceeding because of “his or her physical, mental or psychological condition”. He also argued that policy reasons support allowing additional time for an estate trustee or litigation guardian to be appointed and take over the management of the affairs of the incapable/deceased person.

The Court of Appeal disagreed and did not allow the appeal. In its view, the “grammatical and ordinary sense of the words of s. 7 are simply not elastic enough to apply to a deceased person and to construe an estate trustee to be a litigation guardian.”

Although the outcome is not surprising, it does serve as a reminder that limitation periods can be unforgiving. Estate trustees would be well-advised to act swiftly in reviewing the affairs of a deceased person in order to determine whether any claims may have arisen prior to death, and whether the expiry of any limitation periods are looming.

Thanks for reading,

Rebecca Rauws

 

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