Tag: Ontario Rules of Civil Procedure
A testator appointed you as Estate Trustee of an Estate and a beneficiary filed a Notice of Objection to your appointment. What to do?
Typically, a Notice of Objection to an appointment of an Estate Trustee means that their authority is challenged such that before the administration of the Estate can be addressed, the Notice of Objection must be resolved, first and foremost.
Whereas in the case of a Notice of Objection, the party having filed it, is likely to commence a court proceeding to substantiate his or her claims, that is not always the case. As such, there are a couple of things that an Estate Trustee can do to force the Objector to move forward, in order to ultimately address the resolution of the objection.
- File a Notice to Objector
In accordance with Rule 75.03(4), an Estate Trustee can serve a Notice to Objector and file it with proof of service with the Court.
If the Objector does not serve and file a Notice of Appearance within 20 days of being served with a Notice to Objector, the Estate Trustee’s Application for a Certificate of Appointment is to proceed as if the Notice of Objection had not been filed.
If a Notice of Appearance is served on the Estate Trustee, they have 30 days to bring a motion for directions before the Court and if they do not do so, the Objector may seek directions, as well.
Essentially, the effect of a Notice to Objector is forcing the Objector to commence a claim or else abandon his or her objections.
- Commence an Application or Motion to propound the testator’s Will
Another option that exists for an Estate Trustee is simply skipping the steps that would follow the service of a Notice to Objector and seeking the directions of the Court, in accordance with Rules 14.05 and 75.06 of the Rules of Civil Procedure.
In this case, the Estate Trustee becomes the party commencing a court proceeding such that the costs associated with such a step ought to be considered, before proceeding. It is important to note, however, that proceeding with the first option will not necessarily save on legal costs to be incurred, if the Objector ultimately proceeds with a claim.
The option that is selected by an Estate Trustee will depend on the circumstances of each individual case such that it is important to consult with a lawyer as to which option is best.
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To most, it may seem obvious that an order from the court is not merely a recommendation. The terms of a court order must be followed. Disobeying the terms of an order may result in a finding that a litigant is in contempt. This was a lesson the defendant in Jensen v. Jensen had to learn the hard way.
In Jensen v. Jensen, Sterling Jensen was married to Betty Jensen. It was a second marriage for both of them and they both had children from prior marriages. Sterling passed away in 2014. Prior to his passing, Sterling appointed his son, Randall, as his Attorney for financial and personal care decisions and his other son, Murchie, as his Executor. Following Sterling’s death, Betty commenced an action against Sterling’s estate and his sons, claiming various forms of relief, including ownership of the matrimonial home.
Betty passed away and the trial was adjourned following her death. Betty’s heirs obtained an order to continue the action on behalf of her estate. A motion requesting an order to continue was heard on November 23, 2017. Following the hearing, Justice Petrie issued an order which provided the following, among other terms:
Until judgement is rendered in this action no further assets of the Defendant Estate shall be transferred or disposed of except as necessary to pay the property taxes and other such expenses or as required by law or further order from this Court.
Despite Justice Petrie’s order, in February 2018, Murchie wrote cheques to the beneficiaries of Sterling’s estate amounting to $7,000. In May 2018, land was transferred from Sterling’s estate to one of Sterling’s other sons who was also a beneficiary in the estate. In July 2019, the plaintiffs filed a motion seeking an order to declare the defendant in contempt of court due to his disobedience in following Justice Petrie’s order. The plaintiffs also wanted the defendant to pay back to the estate the amounts that he hastily distributed.
The defendant stated that although Justice Petrie’s order was not respected, he did not believe that he was violating the “spirit of the order”.
In her Judgment, Justice DeWare noted that it was clear that the defendant did not follow Justice Petrie’s order and in not doing so, he was in contempt of court. Justice DeWare went on to state that if the executor felt it was necessary to issue partial payments to the beneficiaries, he should have obtained a further court order which allowed him to do so. Justice DeWare emphasized that court orders are not suggestions and that they must be followed. Pursuant to Rule 76.06 of the New Brunswick Rules of Court, Justice DeWare ordered the defendant to return $35,000 to the estate and pay $1,000 in costs to the plaintiffs.
In summary, Jensen v Jensen provides one simple, yet clear, instruction: always follow court orders. The failure to do so can carry a host of potential detriments. Although Jensen v. Jensen is a New Brunswick case, it can be applied in Ontario as per Rule 60.11(5) of the Rules of Civil Procedure. It states that if the court finds a party in contempt, the judge may order that the litigant be imprisoned, pay a fine, refrain from doing an act, pay costs or comply with any other order that the judge considers necessary. As this provision is similar to the provision in New Brunswick’s Rules of Court, it is likely that had the case been heard in Ontario, the outcome would have been comparable.
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Ian Hull and Celine Dookie
I recently attended a panel discussion with judges of Toronto’s Commercial and Estate Lists, the purpose of which was to explore tips for effective practice and advocacy. A key takeaway from this discussion was that case conferences are a valuable tool in a litigator’s toolbox, particularly when litigation becomes contentious.
Case conferences are governed by Rule 50 of the Rules of Civil Procedure. The purpose of Rule 50 is to promote settlement of some or all of the issues in dispute without a hearing, and to obtain orders or directions to ensure that any necessary hearing is expeditious, orderly, and efficient.
Rule 50.13 dictates that a judge may direct a case conference before a judge or case management master, in either an action or application, on his or her own initiative or at a party’s request. A judge can direct a case conferences at any stage of the litigation. Pursuant to Rule 50.13(5), at a case conference, the judge or case management master may:
- identify the issues, noting those that are contested and those that are not;
- explore methods to resolve the contested issues;
- if possible, secure the parties’ agreement on a specific schedule of events in the proceeding;
- establish a timetable for the proceeding; and
- review and, if necessary, amend an existing timetable.
As discussed by my colleague, Kira Domratchev, in her blog on Rule 49 offers to settle, Ontario is a jurisdiction where parties are encouraged to settle their legal disputes prior to reaching the ultimate hearing of a matter. Case conferences are a valuable tool for parties who are looking to narrow the issues before the court, establish a timetable, or potentially reach a full and final settlement.
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Ontario is a jurisdiction where parties are encouraged to settle their legal disputes well before reaching the ultimate hearing of a matter, and as such it is not uncommon for opposing parties to exchange offers to settle throughout the duration of the dispute.
An additional incentive provided for under the Rules of Civil Procedure to settle the matter is what is called a “Rule 49” offer to settle. Generally, it operates by ensuring a costs award that is favourable to a party who:
(i) makes an offer to settle that complies with the specifications of Rule 49; and
(ii) achieves a more favourable result at the hearing than offered under the offer to settle.
An offer to settle under this rule can be served by a plaintiff, defendant, applicant or respondent in an action, application, counterclaim, third party claim, crossclaim or motion. This means that this rule is applicable to motions on discrete issues within a legal dispute and is not limited only to offers made to settle the entire dispute.
In order to be eligible for the benefits provided under Rule 49, the following requirements must be met:
(i) the offer to settle must be made at least 7 days prior to the commencement of the hearing;
(ii) the offer to settle must be fixed, certain and understandable; and
(iii) it cannot be withdrawn or expire before the commencement of the hearing.
In deciding whether or not to make an offer to settle under this rule, it is important to take into account the fact that the court, in exercising its discretion with respect to costs, may take into account any offer to settle made in writing, the date the offer was made and the terms of the offer.
Where a plaintiff or applicant makes an offer under this rule and the judgment is as or more favourable to that party than the offer to settle, the plaintiff or applicant is entitled to the following:
(i) costs on a partial indemnity basis to the date of the offer to settle; and
(ii) costs on a substantial indemnity basis from that date forward.
Where a defendant or respondent makes an offer under this rule and the judgment is as or less favourable to the plaintiff or applicant than the terms of the offer to settle, the following applies:
(i) the plaintiff or applicant is entitled to partial indemnity costs to the date that the offer to settle was served; and
(ii) the defendant or respondent is entitled to partial indemnity costs from that date forward.
In the event that a party that made an offer to settle under this rule wishes to withdraw it, such withdrawal must be clear and unequivocal.
For more information on the manner in which Rule 49 operates, the Ontario Bar Association summarized the general rules and case law related to it here: https://www.oba.org/getattachment/Sections/Civil-Litigation/Resources/Resources/Litigation-Fundamentals-Sunrise-Series/Offers-to-Settle/Rule49OffersToSettle.pdf
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Earlier this week, I blogged about a recent decision of the Ontario Superior Court of Justice that highlighted the factors the Court will consider when a party seeks to rebut the presumption of revocation when a testator’s Will cannot be located upon death.
Today, I will be highlighting the litigation procedure in Ontario for an Application to prove a lost or destroyed Will.
Pursuant to Rule 75.02 of the Rules of Civil Procedure, the validity and contents of a Will that has been lost or destroyed must be proved by way of an Application before the Court.
As noted in my previous blog post, the party who seeks to prove a lost Will bears the onus to:
- prove due execution of the Will;
- provide particulars tracing possession of the Will to the date of the testator’s death;
- provide proof of the contents of the Will; and
- rebut the presumption that the Will was destroyed by the testator with the intention to revoke it.
However, Rule 75.02(a) provides that a Will may be proven by way of affidavit evidence only if all persons with a financial interest in the testator’s estate consent to the proof. If the appropriate consents can be obtained, the validity and the contents of the Will can be proved without the need for Court appearances.
It is important to note that Rule 75.02(a) appears to require the agreement and consent of all persons with a financial interest. In addition, it is strongly recommended that a person contemplating an Application pursuant to Rule 75.02 obtain legal advice as to who may have a financial interest in the Estate.
For instance, if the result of the Will not being proved would be an intestacy, careful consideration should be given to the consents required from any intestate heirs. Legal advice should also be obtained if there are persons with a financial interest who are not sui juris, such as minors or persons under disability.
If all of the individuals with a financial interest do not consent to proof, Rule 75.02(b) states that the Application will proceed “in the manner provided by the court in an order giving directions made under rule 75.06.” Rule 75.06 provides the Court with the ability to direct the procedural conduct of the litigation.
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Umair Abdul Qadir
The commencement of litigation requires a Plaintiff to have standing to sue; and Probate (or a Certificate of Appointment of Estate Trustee With (or Without) a Will) is required if an Estate Trustee wishes to obtain Judgment against a Defendant.
While an action can technically be commenced without probate (see the remedial provisions of Rule 9 of the Rules of Civil Procedure discussed below), the Court will not grant Judgment in favour of an Estate unless the Estate Trustee has been granted authority to administer the Estate.
The rationale for this requirement is nicely explained by Professor Oosterhoof (in Oosterhoof on Wills and Succession Chapter 2):
The grant of probate is only evidence (really, the only evidence) which a court will recognize that a person has authority to administer the assets of the deceased. For this reason, while an executor can do many acts of office before obtaining a grant he or she cannot obtain judgment before that time, although he or she can commence an action. Similarly, no action can be maintained against a named executor unless he or she has obtained a grant of probate.
This position was supported by the Ontario Court of Appeal in Re Eurig Estate (appealed on other grounds to the Supreme Court of Canada) where Morden A.C.J.O. stated:
Further, apart from the general legal duty to administer the estate promptly and efficiently, which almost invariably requires the executor to obtain probate, the law imposes the requirement that an executor must have probate to prove his or her title when an estate matter is before the court. Letters probate are the only evidence of an executor’s title which a court will receive (see Hull and Hull, Macdonnell, Sheard and Hull, Probate Practice, 4th ed. (1996) at pp.185 and 188), even in a case where the defendant is willing to concede that the executor has title without evidence of probate: Re Crowhurst Park; Sims-Hilditch v. Simmons,  1 W.L.R. 583 (Ch), (at p. 792)
Moreover, the Estates Act ensures the estate trustees named in a Certificate of Appointment of Estate Trustee have sole authority in respect of the estate:
- After a grant of administration, no person, other than the administrator or executor, has power to sue or prosecute any action or otherwise act as executor of the deceased as to the property comprised in or affected by such grant of administration until such administration has been recalled or revoked.
In the event that the Certificate of Appointment of Estate Trustee is obtained subsequent to the commencement of the Action, the Rules of Civil Procedure, contain a remedial provision:
9.03 (1) Where a proceeding is commenced by or against a person as executor or administrator before a grant of probate or administration has been made and the person subsequently receives a grant of probate or administration, the proceeding shall be deemed to have been properly constituted from its commencement.
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With the amendments to the summary judgment rules made some time ago, we are seeing more of these types of motions being brought with a view to terminating litigation short of a trial. The trouble with these motions is that they often involve costly and time-intensive steps, resulting in an exercise that may take several months and cost tens of thousands of dollars. Hence, it is a motion brought in select cases applying careful consideration to the facts, law and risks.
Although there are certain other mechanisms available to us to attempt to narrow the scope of litigation or terminate it altogether, I have found that none is more swift than Rule 2.1 of the Rules of Civil Procedure. The process is, unless the court orders otherwise, conducted entirely in writing. It is simple:
· After the initiation of a lawsuit a defendant/respondent can write a letter to the registrar setting out why the proceeding ought to be dismissed (alternatively, the court may, on its own initiative, stay or dismiss a proceeding);
· The court may either decide the matter based upon such letter alone or after seeking further information e.g. the court can direct the registrar to give notice to the plaintiff/applicant that the court is considering making the order;
· The plaintiff/applicant can then file written submissions within 15 days responding to the notice (no more than 10 pages in length);
· The court may direct the registrar to give a copy of the submissions to any other party (this is not mandatory, so you may obtain an outcome without ever seeing the opposing side’s argument); and
· The defendant/respondent can file written submissions within 10 days responding to the plaintiff’s submissions (no more than 10 pages in length), and shall give a copy of the submissions to the plaintiff/applicant.
After all is said and done a decision can be rendered within a few weeks and with minimal expense. I have seen no other mechanism that can achieve as quick and cost-effective an outcome in clear cases of frivolous, vexatious or abusive proceedings, making Rule 2.1 a most welcome addition to the Rules.
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Sometimes it is the most simple questions that are the most difficult. The Estates Act, R.S.O. 1990, c. E.21 provides that a person “having or pretending to have an interest in the property affected by the will” must be served with an Objection but not much more. Rule 75.01 of the Ontario Rules of Civil Procedure provides that an “estate trustee or any person appearing to have a financial interest in an estate may make an application under rule 75.06 to have a testamentary instrument that is being put forward as the last will of the deceased proved in such manner as the court directs.” Is a creditor a person with such an interest?
In Belz v. Mernick Estate (2000), 31 E.T.R. (2d) 27 (Ont. S.C.J.), Hailey J. held that the sort of “financial interest” that Rule 75 contemplates is a “beneficial interest”. There the context was an application for an Order Giving Directions. Belz v. Mernick Estate has been followed in a number of cases, mostly recently in Salzman v. Salzman, 2012 ONSC 1733 (Ont. S.C.J.).
The reason I raise the point is that I recently came across an interesting English judgment on point. Randall v Randall  EWHC 3134 (Ch.) featured a separation agreement whereby the husband was entitled to part of his former wife’s future inheritance from her mother that was over and above £100,000. The cynical amongst us might not be surprised to learn that the mother gave her daughter exactly £100,000 in the Will. A Motion was brought to determine a number of preliminary issues including whether the ex-husband could challenge the Will. The Court held he could not and traced the rule back to an old case, Menzies v Pulbrook and Kerr  2 Curt 846 (Prerogative Court), and through a series of cases up to the present day. The explanation was of course the same as Justice Hailey’s – an “interest in an estate is not the same as being interested in the estate, or having an interest that is connected to the estate” in the words of the judge. A creditor has an interest in getting paid, not establishing proper rights in the assets of the Estate by law and must confine himself accordingly.
Why should we have an interest in “interests”? We practice in a very old and well litigated field. “Pragmatic” solutions have always been sought by judges and the old cases feature a lot of learning. Given that just about everything is available on the Internet now, I suggest we go a step farther than being archivists. It is a salutary exercise to actually read these old cases and not dismiss them as so many people do as “old authority”. Do we really need to re-invent the wheel on a continuing basis?
As all litigators in the province of Ontario likely know by now, January 1, 2010 ushers in not only a new decade but New Rules of Civil Procedure. The New Rules apply to all matters, regardless of when they were commenced.
The amendments to the Rules effected by Ont. Reg. 438/08 are the most extensive and significant since the Rules were adopted in 1985. The fundamental goal of the reform is to make the civil justice system more affordable and accessible for Ontarians.
Some of the more significant changes are as follows:
Proportionality – In April of 2009 we saw a movement toward proportionality of time and expense with the interests at issue in estate litigation upon the introduction of the New Practice Direction for the Estates List of the Superior Court of Justice in Toronto. New Rule 1.04(1.1) brings this factor into play for litigation in all jurisdictions and mandates that Court Orders and Directions be proportionate to the importance and complexity of issues and amounts at stake.
Summary Judgment – Rule 20 expands the Court’s discretion to assess credibility, weigh evidence, conduct mini-trials with oral evidence, and award substantial indemnity costs against a party acting unreasonably or in bad faith.
Expert Evidence – Experts must provide fair objective and non-partisan opinion, give opinion evidence only on matters that are within their expertise, and assist the Court as reasonably required. This duty to the Court prevails over any obligation experts owe to the party who retained them. Expert reports must be filed 90 days before the pre-trial conference and responding expert reports must be served 60 days prior to the pre-trial conference.
Discovery – Among the many changes regarding discovery is a new definition of relevance. The phrase “relating to any matter in issue in the action” has been replaced with “relevant to any matter in issue in the action”. This changes the test to one of simple relevance. Proportionality comes into play again in Rule 29.2, which sets out the considerations that must be made in determining questions to be answered or documents to be produced. Parties must agree to a written discovery plan (Rule 29.1) and there is a 7-hour time limit on oral examinations for discovery (R. 31.05.1).
Time – Calculation of time pursuant to Rule 3.01(1)(b) for notice periods of 7 days or less excludes holidays. There are also earlier deadlines for service and filing of materials for motions (Rule 37) Applications (Rule 38) and appeals from interlocutory orders (Rule 61).
If your New Year’s resolution is to learn the New Rules and their impact on your estates practice, you should attend the OBA Trusts and Estates Section Seminar, "Stay on top of the New Rules of court" on January 6, 2010.
Program Chair, Jane Martin, and speakers, Mr. Justice David M. Brown and Madam Justice Lois B. Roberts of the Superior Court of Justice, and Hull & Hull’s own Suzana Popovic-Montag, will guide you through the changes and provide an opportunity to ask questions regarding implications for estates practitioners.
For more on this topic see Gary Watson’s summary of the amendments and Marni Pernica’s recent article in OBA’s Deadbeat magazine. Previous Hull & Hull commentary by Rick Bickhram and Paul Trudelle can be found here and here.
I suspect that following the New Rules is one Resolution you will be sure to keep!
Sharon Davis – Click here for more information about Sharon Davis.
Ontario’s Rules of Civil Procedure mandate that in civil litigation, one must disclose electronic data (see the definition of “document” and “electronic” in Rule 1.03). However, there is very little guidance in the Rules or the case law about exactly how to disclose electronic data.
In today’s technology age, where the majority of our communications are via e-mail and not paper documents, electronic or e-discovery has become increasingly important. We’ve seen the importance of e-discovery in complex commercial litigation. Yet, it can be important and useful even in the context of less complex lawsuits, such as wrongful dismissal claims where e-mails can help form an employer’s case against an ex-employee.
It seems that many in the legal profession are unfamiliar with their clients’ obligations to preserve and produce electronic documents, and with the technology available to retrieve, search and produce such documents. In response to this deficiency, the Ontario Bar Association (OBA) recently released their Guidelines for the Discovery of Electronic Documents. The Guidelines address the preservation, retrieval, exchange and production of documents from electronic sources in electronic form. The Guidelines also explain important terminology relevant to e-discovery. For example, “metadata” is electronic information recorded about a particular document, such as its format and how, when and by whom it was created, saved or modified. “Active data” is data that is currently used in day-to-day operations.
Is e-discovery relevant to estate litigation? I believe that, with time, it will become more relevant. More and more people are keeping electronic records of all kinds of information, from financial transactions to diary-type entries concerning family relationships. For example, I learned of a situation in which a beneficiary believed that a testator had kept detailed electronic records during her lifetime of cash loans made to family members. The family members denied the existence of the loans and the electronic evidence of such loans appeared to have been deleted. Efforts were made to recover the deleted information.
E-discovery can form the basis of successful litigation, including Will challenges. The OBA’s e-discovery guidelines can help all lawyers cope with this new way to litigate.
Have a great day!
Bianca La Neve