Court of Appeal for Ontario

Date: 2024-09-12 Docket: COA-23-CV-0998

Before: Roberts, Miller and Gomery JJ.A.

Between:

Kathleen Ingram Applicant (Respondent)

and

Cherise Charron in her capacity as Estate Trustee of the Estate Henry Harry Kulynych and in her personal capacity to the extent which she had distributed the Estate Assets and Estate of Maurice Alfred Loton Respondents (Appellants)

Counsel: Andrew D. Felker, for the appellants Jonathan M. Friedman and Cassandra Martino, for the respondent Ian M. Hull and Doreen Lok Yin So, for the intervener, Toronto Lawyers Association

Heard: June 25, 2024

On appeal from the order of Justice Jonathan Dawe of the Superior Court of Justice, dated August 9, 2023.

Roberts J.A.:

I. Overview

[1] This appeal arises from a dispute about the estate of the late Henry Kulynych. It turns on whether the ten-year limitation period under s. 4 of the Real Property Limitations Act, R.S.O. 1990, c. L.15 (“RPLA”), rather than the two-year limitation period under s. 38(3) of the Trustee Act, R.S.O. 1990, c. T.23, applies to the respondent’s claim for compensation against Mr. Kulynych’s estate. In her notice of application, the respondent framed her claim as a “constructive trust and unjust enrichment claim” (“the equitable trust claim”).

[2] The motion judge concluded that the ten-year limitation period under s. 4 of the RPLA applied and that the respondent could proceed with her claim. I would allow the appeal. These reasons explain why I conclude that the two-year limitation period under the Trustee Act applies to the respondent’s equitable trust claim against the appellants. As the respondent failed to bring her equitable trust claim within two years of Mr. Kulynych’s death, it is statute-barred and should be dismissed.

II. Background

[3] The following factual background comes from the motion judge’s reasons and the parties’ pleadings.

[4] Mr. Kulynych died in February 2017, leaving a last will and testament that he had prepared in 1989 (the “will”). He left his estate to his first wife, or, if she died first, which she did, to his three children (“the beneficiaries”). His daughter, the appellant, Cherise Charron, was appointed as the Estate Trustee pursuant to a certificate of appointment in July 2018 (“the Estate Trustee”). The will left nothing to the respondent. The respondent claimed that she had been in a common law relationship with Mr. Kulynych from 1999 to his death in 2017 and that she supported him financially and emotionally, and “was by [his] side for all of his medical needs and took care of him until the day he died”.

[5] Mr. Kulynych’s estate at the time of his death was valued at $690,119.59. The estate’s principal asset was a house in the Town of Ajax that the Estate Trustee ultimately sold for $475,585.10 on March 29, 2019. The Estate Trustee distributed to the beneficiaries the net sale proceeds from the Ajax house on April 4 and 5, 2019. The Estate Trustee distributed most of the balance of the estate’s money to the beneficiaries in March 2020. A small holdback of $1,910.07 remained in the estate until July 2021 when the Estate Trustee distributed the holdback to herself.

[6] In March 2018, the respondent, through her counsel, the late Maurice Loton, [1] sent correspondence to the Estate Trustee and her counsel asserting that she was entitled to receive one-third of the total value of the estate, to recover “some of the money that she spent in caring for and providing for [Mr. Kulynych] over the years”. The respondent refused a settlement proposal for a lesser amount.

[7] It was not until March 10, 2021, more than four years after Mr. Kulynych’s death, that the respondent commenced an application against Mr. Kulynych’s estate for dependant’s support under the Succession Law Reform Act, R.S.O. 1990, c. S.26 (“SLRA”). She also brought an equitable trust claim for a share of the estate. She claimed that the Estate Trustee was personally liable for having distributed the estate despite her claims. In her notice of application, the respondent set out the basis for her equitable trust claim as follows:

[Mr. Kulynych] [resided] in the home of the [respondent] during the period of their cohabitation, while he rented his house out. This allowed [Mr. Kulynych] to accumulate significant value in a home at the expense of the [respondent]. The [respondent] is entitled to a portion of the home of [Mr. Kulynych] on the basis of constructive trust and unjust enrichment.

[8] The respondent sought the following remedy in her notice of application:

An order that the [respondent] is entitled to an interest in the Estate by virtue of Constructive Trust and Resulting Trust in relation to all estate assets on the basis of contribution of money or money’s worth.

[9] On the agreement of the parties, the appellants brought a motion in writing before the motion judge in which they “would seek to have the respondent’s application against her and her late father’s estate dismissed on the grounds that it is limitations-barred.” The motion judge characterized the appellants’ motion “as a motion for judgment under rule 21.01(1)(a) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194,” because the limitations issues that the appellants raised involved questions of law, rather than issues of mixed fact and law that would require him to resolve contested issues of fact. The motion judge determined that “[t]o the extent that the issues [the appellants] [raise] do involve questions of fact, these facts appear to be undisputed.” The motion judge allowed the filing of the parties’ evidence, inferring that the parties consented to this evidence being received, under r. 21.01(2)(a). However, he does not appear to have taken the parties’ evidence into account in making his decision. He emphasized that:

[T]his is not a motion for summary judgment. The underlying merits of [the respondent’s] legal and equitable claims, which do involve contested issues of fact, are not before me to decide, and neither [the respondent’s] nor [the appellants’] affidavit evidence has been tested by cross-examination. [Emphasis in original.]

[10] The motion judge extended the six-month limitation period under s. 61(1) for the respondent’s dependant support claim pursuant to his discretion under s. 61(2) of the SLRA in relation to the estate funds in the amount of $1,910.07 that had been undistributed as of the date the respondent commenced her application. The appellants do not appeal from this determination.

[11] The motion judge rejected the appellants’ argument that the respondent’s equitable trust claim amounted to a “repackaged version” of her dependant support claim because “[t]he juristic bases for her two claims are different” and “[s]uccess on one or the other of her claims might lead to [the respondent] being granted different remedies, and her failure on one claim would not necessarily preclude her from succeeding on the other.” In particular, the motion judge differentiated the equitable trust claim as follows: “[the respondent’s] claim for a remedial constructive trust over the estate property, including the Ajax house, hinges on her allegation that the estate has been unjustly enriched by the benefits she says she provided for Mr. Kulynych during his lifetime.”

[12] The motion judge remarked that it was not his task “to decide whether the [respondent’s] equitable trust claim is factually well-founded” and that the sole issue before him on the motion “is whether her claim is statute-barred.” He therefore did not give effect to the appellants’ argument that the respondent’s affidavit evidence did not support her claim. Nor did he consider the sufficiency of the respondent’s pleadings. He concluded that the question of whether the respondent’s claim is statute-barred “hinges entirely on the legal nature of her claim, not on its prospects of success at trial.”

[13] The motion judge reviewed the Superior Court decision in Wilkinson v. The Estate of Linda Robinson, 2020 ONSC 91, 55 E.T.R. (4th) 56 that held the ten-year limitation period under s. 4 of the RPLA applied to equitable trust claims against estates. He concluded that he was bound to follow it because of the principle of parity but, even if he were not so bound, he also agreed with its reasoning. In particular, he concluded that the respondent’s equitable trust claim was not “a wrong” committed by the deceased under s. 38(2) of the Trustee Act, but rather a property claim under s. 4 of the RPLA. As a result, he found that the ten-year limitation period under the RPLA applied and that the respondent’s claim was not statute-barred. He therefore dismissed the appellants’ motion.

III. Issues and the Parties’ Positions

[14] The appellants and the intervener submit that the motion judge erred in concluding that the ten-year limitation period under s. 4 of the RPLA applies to the respondent’s equitable trust claim. They argue that the respondent does not have an equitable trust claim and that in any event the respondent’s equitable trust claim, as pleaded and in substance, falls within the claims described under s. 38(2) of the Trustee Act that are subject to the two-year limitation period under s. 38(3). Further, they urge this court to determine as a matter of legal principle that all such equitable trust claims against an estate must be subject to the two-year limitation period prescribed under s. 38(3) of the Trustee Act. This, the appellants and intervener maintain, is in keeping with the legislative policy that estates should be expeditiously administered and distributed and that estate trustees have certainty that there are no other claims before they distribute estate assets to the named beneficiaries under a will.

[15] The respondent submits that there is no policy reason to distinguish between the applicable limitation period for inter vivos equitable trust claims and estate equitable trust claims. It is simply a matter of statutory interpretation: equitable trust claims are claims to recover land as defined in the case law, in particular, by this court in McConnell v. Huxtable, 2014 ONCA 86, 118 O.R. (3d) 561 and, as such, clearly fall within s. 4 of the RPLA and are subject to the ten-year limitation period. Equitable trust claims are not “wrongs” committed by the deceased as defined under s. 38(2) of the Trustee Act. As a result, the motion judge correctly determined that the ten-year limitation period under s. 4 of the RPLA applied and that the equitable trust claim was not statute-barred.

IV. Analysis

(i) Standard of Review

[16] For questions of law, the standard of review on appeal is correctness: Beaudoin Estate v. Campbellford Memorial Hospital, 2021 ONCA 57, 154 O.R. (3d) 587, at para. 12. As earlier noted, the motion judge treated the appellants’ motion as a motion under r. 21.01(1)(a) of the Rules because he was asked to determine a question of law with no facts in dispute. Accordingly, the standard of review of the motion judge’s decision is correctness.

(ii) Which limitation period applies to the respondent’s equitable trust claim?

(a) Threshold assumptions

[17] I start my analysis by assuming, without deciding, for the purposes of determining the legal issue of which limitation period applies, that the respondent’s equitable trust claim was properly pleaded [2] and that there was only a pure legal issue with no material facts in dispute to be determined. [3] Finally, I do not propose to address the merits of the respondent’s equitable trust claim nor of the defence. [4] This is the way the motion judge approached the limitations period issue, and for the purpose of the legal questions raised on appeal, I shall do the same.

(b) Correct analytical approach

[18] With these assumptions in place, I will review the motion judge’s analysis through the lens of the applicable governing principles.

[19] The proper approach to statutory interpretation is well entrenched. The goal is to determine the intention of Parliament by reading the words of the provision, in context and in their grammatical and ordinary sense, harmoniously with the scheme of the Act and the object of the statute. In addition, a number of specific rules of construction may serve as useful guideposts in interpretation: Canada (Information Commissioner) v. Canada (Minister of National Defence), 2011 SCC 25, at para. 27.

[20] The motion judge correctly identified two potentially applicable limitation periods with respect to the respondent’s equitable trust claim: 1) the two-year limitation period respecting claims against an estate under s. 38(3) of the Trustee Act; and 2) the ten-year limitation period in relation to an interest in property under s. 4 of the RPLA. Subsection 2(1)(a) of the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B (“the LA”) excepts from the LA’s application all proceedings to which the RPLA applies, and s. 19 provides that a limitation period established under the Trustee Act, as listed under the Schedule to the LA, prevails over the LA.

[21] Bank of Montreal v. Iskenderov, 2023 ONCA 528, 168 O.R. (3d) 1 consolidates well-established principles into a clear analytical approach. In Iskenderov, this court grappled with the issue of which of two potentially applicable limitation periods applied in the context of fraudulent conveyance actions, namely, s. 4 of the LA or s. 4 of the RPLA. It concluded that s. 4 of the LA applied. At paras. 13-16, 45, Feldman J.A., for the 5-judge panel, set out the correct analytical path to follow when considering which of two limitation periods should apply. This analysis includes the following factors: the historical approach to the limitation periods in issue, including the legislative purpose of the relevant statutory limitation periods; the judicial approach to interpreting the limitation periods in issue; the nature of relief sought in the action; and the language of the statutory limitation provisions.

[22] It is important to note that the motion judge and the parties did not have the benefit of Iskenderov. Accordingly, the parties’ submissions and the motion judge’s analysis primarily focussed on the “plain wording” of the statutory provisions in issue as well as the application of this court’s decision in McConnell. As a result, the motion judge was not asked to engage in a thorough review of the legislative history and purposes and the judicial treatment of s. 38 of the Trustee Act, nor of the relationship between related estate and family law statutory provisions. As I shall explain, when the limitations issues are considered using the Iskenderov analytical approach, the outcome is necessarily different.

(c) Legislative history and purpose of the two-year limitation period under s. 38(3) of the Trustee Act and judicial treatment of claims against estates

[23] The relevant provisions are s. 38(2) and (3) of the Trustee Act.

[24] Section 38(2) provides as follows:

Except in cases of libel and slander, if a deceased person committed or is by law liable for a wrong to another in respect of his or her person or to another person’s property, the person wronged may maintain an action against the executor or administrator of the person who committed or is by law liable for the wrong.

[25] The two-year limitation period applicable to claims under s. 38(2) is set out in s. 38(3) of the Trustee Act, as follows: “An action under this section shall not be brought after the expiration of two years from the death of the deceased.”

[26] In Waschkowski v. Hopkinson Estate (2000), 47 O.R. (3d) 370 (C.A.), at para. 8, this court confirmed that the two-year limitation period under s. 38(3) of the Trustee Act is a strict limit and the discoverability principle does not apply to actions under s. 38: “[r]egardless of when the injuries occurred or matured into an actionable wrong, s. 38(3) of the Trustee Act prevents their transformation into a legal claim unless that claim is brought within two years of the death of the wrongdoer or the person wronged.”

[27] I agree with the appellants’ and intervener’s submissions that the inapplicability of the discoverability principle and the clear two-year limit for bringing an action under s. 38 of the Trustee Act demonstrate the legislative intent that actions against estates be subject to the shorter limitation period. The shorter, two-year limitation period for estate matters reflects the long-established duty of estate trustees to administer estates promptly and diligently, including ascertaining the estate’s liabilities and debts as quickly as possible, as the expeditious administration of estates is in the interests of justice: Appleyard v. Zealand, 2022 ONCA 570, 162 O.R. (3d) 494, at para. 60; Omiciuolo v. Pasco, 2008 ONCA 241, 90 O.R. (3d) 175, at para. 25; Euring Estate (Re), (1997), 31 O.R. (3d) 777 (C.A.), at p. 792. It is also consistent with the interest of finality in the administration of estates: Roth v. Weston Estate, [1997] O.J. No. 4445 (C.A.), at para. 11.

[28] The duty to administer estates promptly and the interest in finality militate in favour of shorter limitation periods in this context. As the Supreme Court noted in Ryan v. Moore, 2005 SCC 38, [2005] 2 S.C.R. 53, at para. 33:

A further reason for the non-application of the discoverability rule is the evident impact such a rule would have on the distribution of assets to the beneficiaries. Without a time limit, an executor or an administrator would not feel free to distribute the assets of an estate until all reasonable possibilities of claim had been addressed. This would be cumbersome and unrealistic. ‘An estate should not be held to ransom interminably by the advancement of claims which are not proceeded with in a timely manner’. [Citations omitted.]

[29] As this court explained at para. 9 of Waschkowski, the two-year limitation period allows “access to a remedy available for a limited time without creating indefinite fiscal vulnerability for an estate.” The court explained the underlying legislative policy considerations that inform the enactment and meaning of s. 38 of the Trustee Act:

The underlying policy considerations of this clear time limit are not difficult to understand. The draconian legal impact of the common law was that death terminated any possible redress for negligent conduct. On the other hand, there was a benefit to disposing of estate matters with finality. The legislative compromise in s. 38 of the Trustee Act was to open a two-year window, making access to a remedy available for a limited time without creating indefinite fiscal vulnerability for an estate. [5] [Emphasis added.]

[30] In Levesque v. Crampton Estate, 2017 ONCA 455, 136 O.R. (3d) 161, at para. 22, this court referenced Waschkowski and at para. 52 repeated the legislative rationale behind the Trustee Act limitation period, stating that: “The purpose of the Trustee Act limitation period is clear. It is to provide a remedy for a limited time, without indefinite fiscal vulnerability to the estate: Waschkowski, at para. 9” (emphasis added). This purpose is in keeping with the general legislative rationale behind all limitation periods. As this court went on in Levesque to explain, at para. 53:

As this court observed in Independence Plaza 1 Associates, L.L.C. v. Figliolini, 2017 ONCA 44, limitations statutes reflect public policy about efficiency and fairness in the justice system. See Manitoba Métis Federation Inc. v. Canada (Attorney General), 2013 SCC 14, [2013] 1 S.C.R. 623, at paras. 231-34 (per Rothstein J. in dissent, but not on this point). They have several goals. They promote finality and certainty in legal affairs by ensuring that potential defendants are not exposed to indefinite liability for past acts. They reflect a policy that, after a reasonable time, people should be entitled to put their pasts behind them and should not be troubled by the possibility of “stale” claims emerging from the woodwork. They ensure the reliability of evidence. And they promote diligence, because they encourage litigants to pursue claims with reasonable dispatch. [Emphasis added.]

[31] Finally, at para. 55 of Levesque, this court expressed the following conclusion about the legislative policy underlying the Trustee Act:

The legislative history of the Limitations Act, 2002, dating back to 1969, reflects a concern about the Trustee Act limitation period and no less than five recommendations or legislative initiatives to abolish it. The fact that it was expressly retained in the Schedule reflects a clear policy choice in favour of certainty and finality in estate matters after a fixed period of two years. [Footnotes omitted; emphasis added.]

[32] While Waschkowski and Levesque were concerned with claims for negligent conduct, as I shall explain in further detail below, the “wrong” envisaged under s. 38(2) of the Trustee Act encompasses more than just tort claims against an estate and is not determined by the framing of the action pleaded or remedy claimed but by the nature of the claimed injury, regardless of how it is pleaded: Smallman v. Moore, [1948] S.C.R. 295, at p. 298; Roth, at paras. 6-11; Bikur Cholim Jewish Volunteer Services v. Penna Estate, 2009 ONCA 196, 94 O.R. (3d) 401, at para. 24; Lafrance Estate v. Canada (Attorney General) (2003), 64 O.R. (3d) 1, at paras. 54, 55 (C.A.). As a result, the underlying policy considerations for a two-year limitation period apply to all estate claims captured under s. 38(2) of the Trustee Act.

[33] The legislative intent of a shorter limitation period for estate matters permeates related estate and family law legislation. The interpretation of s. 38(3) of the Trustee Act, as part of the contextual and purposive approach to statutory interpretation, is informed by the presumption of coherence among related statutes. This approach seeks to avoid contradictions or inconsistencies among parts of the same body of legislation and presumes that constituent elements of a legislative scheme are meant to work together logically and purposively, each contributing to the achievement of the legislature’s goal. As a result, interpretations favouring harmony among related statutes rather than conflict better reflect the legislature’s intent. See: Ruth Sullivan, The Construction of Statutes, 7th ed. (Toronto, ON: LexisNexis, 2022), at p. 323; P.-A. Côté, in collaboration with S. Beaulac and M. Devinat, The Interpretation of Legislation in Canada, 4th ed. (Toronto: Carswell, 2011), at p. 365. As Ruth Sullivan noted, at p. 323 of her text: “This presumption is the basis for analyzing legislative schemes, which is often the most persuasive form of analysis.”

[34] In the context of the related spheres of estates and family law, the presumption of coherence in related legislation is even stronger. As Professor Pierre-André Côté explains at p. 365:

This presumption of coherence in enactments of the same legislature is even stronger when they relate to the same subject matter, in pari materia. When conflicts between statutes do arise, however, they should be resolved in such a way as to re-establish the desired harmony. [Footnotes omitted; emphasis added.]

[35] While the wording of s. 38(1) of the Trustee Act is different from s. 38(2), the legislative intent to cap all claims against an estate to two years from the date of the death of a deceased arising out of a wrong to a person or property is nevertheless apparent in the treatment of claims by deceased persons under s. 38(1). As this court instructed in Swain Estate v. Lake of the Woods District Hospital, [1992] O.J. No. 1358 (C.A.), at para. 13, leave to appeal refused, [1992] S.C.C.A. No. 467:

The only way to give any effect to that subsection is to construe it as restricting to two years from death any longer limitation period which would otherwise be passed on to the administrator by the broad scope of s. 38(1) at the time of death. To do otherwise would make [s. 38(3)] completely redundant, as nothing more than s. 38(1) would be necessary to determine the applicable limitation period. … However, the estate cannot get the benefit of the full remainder of the limitation period if it extends past two years after the death, as [s. 38(3)] will operate to cap the limitation period at that point. … [T]he language of s. 38 of the Trustee Act is clear that the extended limitation period … is superseded by the two-year limitation period in s. 38 of the Trustee Act. [Emphasis added.]

[36] See also, Camarata v. Morgan (2009), 2009 ONCA 38, 94 O.R. (3d) 496 (C.A.), at para. 8, where this court explained the effect of s. 38(3) of the Trustee Act in relation to s. 38(1) to create a shorter limitation period, as follows:

Section 38(3) of the Trustee Act does not have the effect of tolling a limitation period that excludes the limitation period made applicable to the action by ss. 4 and 5 of the Limitations Act. Section 38(3) creates a second limitation period that operates in addition to any limitation period that would have applied had the deceased been able to carry on with the action. In some circumstances, s. 38(3) will effectively shorten what would otherwise be the applicable limitation period: see Swain Estate v. Lake of the Woods District Hospital, supra. Section 38(3) cannot extend the limitation period that would have been applicable had the deceased not died and been able to carry on with his action.

[37] Consistent with the shorter limitation period under s. 38(3) of the Trustee Act, s. 44 of the Estates Act, R.S.O. 1990, c. E.21, provides for a strict 30-day time limit following the receipt of the estate’s contestation of a claim.

[38] In this context, the very short limitation periods under the SLRA and under the Family Law Act, R.S.O. 1990, c. F.3 (“FLA”) arising on the death of a spouse are relevant. As earlier noted, under s. 61(1) of the SLRA, a dependant has only six months in which to make a claim for support, which can be extended by the court under s. 61(2). There is a similarly short claim period for spousal elections under the FLA. Under s. 5(2) of the FLA, “[w]hen a spouse dies, if the net family property of the deceased spouse exceeds the net family property of the surviving spouse, the surviving spouse is entitled to one-half the difference between them.” Where a spouse dies leaving a will, “the surviving spouse shall elect to take under the will or to receive the entitlement under section 5”: s. 6(1); notably, the spouse has only six months to make this election: s. 6(10).

[39] Finally, in my consideration of the legislative history and purpose of s. 38(3) of the Trustee Act, I look at the changes between former related provisions and the present provisions. It is presumed that they are made deliberately and for an intelligible purpose: Ruth Sullivan, at p. 629.

[40] There was a significant substantive change to the former Limitations Act, R.S.O. 1990, c. L.15 (“former LA”) with respect to specified claims under ss. 43(2) and 44(2) against trustees, including claims “to recover trust property or the proceeds thereof”. These included claims to land based on resulting or constructive trust: Hartman Estate v. Hartman Holdings Ltd. (2006), 263 D.L.R. (4th) 640 (ONCA), at paras. 85 and 87.

[41] In the former LA, there was no statutory limitation period for the exceptions provided in s. 43(2): Hartman Estate, at paras. 85 and 87; Edwards v. Law Society of Upper Canada (No. 1), [2000] O.J. No. 2084 (C.A.), at para. 13. In Edwards, at paras. 10, 11, this court confirmed that s. 38(3) of the Trustee Act could stand together with ss. 43 and 44 of the former LA, and agreed with the motion judge that:

The two-year limitation provision prescribed by s. 38(3) applies generally to actions against executors for wrongs committed by the deceased, while the explicit saving provision of ss. 43 and 44 of the Limitations Act applies to claims falling within the specific description of those sections.

[42] In other words, according to Edwards, s. 38(3) applies unless there is an exemption.

[43] Sections 43 and 44 do not appear in any form in the amended LA. It would have been a simple thing for the legislature to retain the provision that there was no limitation period against trustees for the exceptions provided under s. 43(2) in the amended LA or to specify a time limit on recovery. By not doing so, the legislature must be taken to have intended that s. 38(3) of the Trustee Act applies to all equitable trust claims against estates, except those specifically excepted.

[44] I note three express exceptions in relation to estates under the RPLA to the two-year limitation period under s. 38(3). The respondent highlights the ten-year limitation period prescribed under s. 42 of the RPLA for claims to recover land or rents in respect of express trusts of land or rent vested in a trustee. I also note ss. 25 and 26 of the RPLA that set out a ten-year limitation period commencing at the death of the husband for an action of dower brought by a married woman against her husband’s estate. Finally, s. 27 of the RPLA relatedly prescribes a six-year limitation period for an action for arrears of dower or any damages on account of such arrears.

[45] The respondent argues that the exceptions belie a legislative intent to impose the two-year limitation period under the Trustee Act on all trust claims against estates. I disagree. These exceptions are just that – discrete, readily ascertainable exceptions to the legislative intent that otherwise all other estate trust claims that fall within s. 38(2) of the Trustee Act are meant to be subject to the two-year limitation period under s. 38(3). Again, it would have been a simple thing for the legislature to include equitable trust claims against an estate as an exception to s. 38 of the Trustee Act. It did not do so.

(d) Does the respondent’s equitable trust claim fall within s. 38(2) of the Trustee Act?

[46] In the context of the history and purpose of the legislation, as well as the judicial approach to equitable trust claims against estates, the next step in the analysis is to determine whether the respondent’s equitable trust claim, as pleaded and in substance, falls within the language of s. 38(2) of the Trustee Act and is subject to the two-year limitation period under s. 38(3).

[47] For ease of reference, I reproduce the provisions of s. 38(2):

Except in cases of libel and slander, if a deceased person committed or is by law liable for a wrong to another in respect of his or her person or to another person’s property, the person wronged may maintain an action against the executor or administrator of the person who committed or is by law liable for the wrong.

[48] The motion judge determined that the “plain wording” of s. 38(2) indicates “that in cases involving actions against an estate, the two-year limitation period in s. 38(3) only applies to actions arising out of ‘wrongs’ in respect of the claimant’s person or property that were either committed by the deceased, or for which the deceased is liable.” He reasoned that s. 38(3) did not apply to equitable trust claims, including the respondent’s claim, because “[p]eople who claim some form of legal or equitable ownership of real property that forms part of a deceased’s estate, including through a remedial constructive trust, will not necessarily be alleging that the deceased committed any wrongful act while he or she was alive.”

[49] In my view, the motion judge’s construction of a “wrong” in the context of equitable trust claims for unjust enrichment against an estate was too narrow.

[50] First, as earlier noted, the “wrong” in s. 38(2) is not restricted to tortious conduct committed by the deceased but refers to all actionable wrongs that wrong a claimant and for which the deceased may be found liable. As this court clarified in Roth, at para. 6, a broad meaning was intended with respect to the interpretation of “wrong”, referencing the Supreme Court’s decision in Smallman:

The court [in Smallman] determined that whether an action was for a wrong committed by a deceased in respect of the person of another did not depend on whether the action was framed in tort or in contract. The court found that the subsection could include either form of action and that it was not confined to actions in tort nor to bodily injury or trespass to the person. As the court said at p. 298:

If “a wrong to another in respect of his person” was intended to mean a bodily injury or trespass to the person, it would have been unnecessary to except libel and slander where the injury is personal in its nature: the fact that these actions are excepted indicates to me that the intention was that a wider meaning should be given to the expression and that actions for all injuries of a personal nature should be included.

[51] Unjust enrichment is appropriately construed as a “wrong” falling under s. 38(2) of the Trustee Act. The elements of unjust enrichment are a benefit, a corresponding deprivation and the absence of juristic reason for the benefit and the loss: Kerr v. Baranow, at para. 32. As the Supreme Court explained in Kerr, at para. 31: “At the heart of the doctrine of unjust enrichment lies the notion of restoring a benefit which justice does not permit one to retain” (emphasis added). Put another way, unjust enrichment may be defined as “the unjust retention of a benefit to the loss of another, or the retention of money or property of another, against the fundamental principles of justice or equity and good conscience” (emphasis added): Bruyninckx v. Bruyninckzx, [1995] B.C.J. No. 524 (C.A.), at para. 58, referencing with approval American Jurisprudence, “Restitution and Implied Contracts”, 2nd ed., vol. 66, at p. 945. The plain meaning of “unjust”, “inequitable” or “unconscionable” connotes a “wrong” for the purposes of s. 38(2) of the Trustee Act.

[52] The respondent’s claim for unjust enrichment falls neatly within s. 38(2) of the Trustee Act. The respondent asserts that during their relationship, Mr. Kulynych financially benefited at her expense by living rent-free in her house, while renting out his own house and retaining the rental income for himself. She alleges that Mr. Kulynych’s financial benefit at her expense amounts to an unjust enrichment in respect of which she seeks the imposition of a constructive trust over the entirety of the estate’s assets. In other words, the respondent claims that she has been wronged by Mr. Kulynych’s unjust enrichment (i.e., “at her expense”), which she seeks to have remedied by way of a constructive trust or a resulting trust.

(e) Does the respondent’s equitable trust claim also fall under s. 4 of the RPLA?

[53] That the respondent’s equitable trust claim falls within s. 38(2) of the Trustee Act is not the end of the required analysis. In applying the presumption of coherence in statutory interpretation, I must also consider whether the inclusion of equitable trust claims under s. 38(2) for the purpose of s. 38(3) of the Trustee Act can stand together with s. 4 of the RPLA.

[54] In my view, it can.

[55] In the circumstance of an apparent conflict between the specific provisions of s. 38 of the Trustee Act and the general provisions of s. 4 of the RPLA as to which limitation period applies to equitable trust claim against estates, the well-recognized principle of statutory interpretation generalia specialibus non derogant applies. This principle provides that special or more specific legislation overrides general legislation in the case of a conflict on the same subject so that the two statutes are brought into harmony: R. v. Greenwood (1992), 7 O.R. (3d) 1 (C.A.), at p. 7. See also: Bhuthal v. Sahsi, 2024 BCCA 73, at paras. 17, 18; Schnarr v. Blue Mountain Resorts Limited, 2018 ONCA 313, 140 O.R. (3d) 241, at paras. 62-64; 792266 Ontario Ltd. v. Monarch Trust Co. (Liquidator of), [1996] O.J. No. 3913 (C.A.), at para. 16; York (Township) v. North York (Township) (1925), 57 O.R. 644 (C.A.), at pp. 648-649. As this court instructed in Greenwood, at p. 7, “[t]he question of what constitutes special legislation as opposed to general legislation must, in itself, be a matter of construction involving a careful examination of the overall schemes of the two pieces of legislation to determine Parliament’s intention.”

[56] Applying this test, having regard to the language, the legislative history and purposes, and judicial treatment of ss. 38(2) and (3) of the Trustee Act, I conclude that those provisions are more specific than s. 4 of the RPLA and are intended to apply to equitable trust claims against estates.

[57] In contrast, s. 4 of the RPLA is general and does not refer to estate proceedings. Section 4 provides as follows:

No person shall make an entry or distress, or bring an action to recover any land or rent, but within ten years next after the time at which the right to make such entry or distress, or to bring such action, first accrued to some person through whom the person making or bringing it claims, or if the right did not accrue to any person through whom that person claims, then within ten years next after the time at which the right to make such entry or distress, or to bring such action, first accrued to the person making or bringing it. [Emphasis added.]

[58] Interpreting s. 4 of the RPLA to include equitable trust claims against estates ignores the language, legislative history, purpose, and judicial treatment of s. 38 of the Trustee Act. It also requires the inclusion of language that the legislature did not intend. Moreover, this interpretation would be inconsistent with the overarching interests of justice that estates be efficiently and quickly administered.

[59] This latter goal is reflected in the provisions for the timely administration of estate assets under the Estates Administration Act, R.S.O. 1990, c. E.22 (“EAA”). In particular, s. 9(1) of the EEA undercuts the suggestion that the longer ten-year limitation period under s. 4 of the RPLA was intended to apply to equitable trust claims against estates. Under s. 9(1) of the EEA, in the absence of a registered caution, all real property not disposed of within three years of the deceased’s death automatically vests, without any conveyance by the deceased’s personal representative, in the persons beneficially entitled to it under the deceased’s will or upon his or her intestacy.

[60] Is the respondent’s equitable trust claim against the appellants “an action to recover any land”? In my view, it is not. This is because the nature of the respondent’s equitable trust claim is in relation to the estate assets and not in relation to Mr. Kulynych’s real property. As earlier referenced, the respondent’s claim for relief is for: “An order that [the respondent] is entitled to an interest in the Estate by virtue of Constructive Trust and Resulting Trust in relation to all estate assets on the basis of contribution or money’s worth” (emphasis added). The fact that the respondent is claiming, based on an unjust enrichment, an interest in all the estate’s assets, beyond the deceased’s real property, indicates that this is an estate claim that clearly falls within s. 38(2) of the Trustee Act and not a claim to recover property or money compensation in lieu of property.

[61] The respondent’s equitable trust claim crystallized on the death of Mr. Kulynych. At that point, Mr. Kulynych’s assets became the estate’s assets and vested in his executrix: see s. 2(1) of the EAA. Moreover, the respondent’s equitable trust claim is not in the nature of the exceptions earlier noted of an express trust claim, a dower right or a statutory entitlement. It is a claim in relation to Mr. Kulynych’s assets that have devolved to his estate.

[62] The respondent submits that the outcome of this appeal is governed by this court’s decision in McConnell that equitable trust claims are subject to the ten-year limitation period under s. 4 of the RPLA. In my view, McConnell does not assist the respondent because it did not involve a claim against the estate of a deceased person. As earlier discussed, the legislative history and purpose of s. 38 of the Trustee Act and its judicial treatment distinguish claims against and by an estate from claims unrelated to estates. Unless specifically exempted, the legislature clearly intended that equitable trust claims against an estate should fall within s. 38(2) and be subject to the two-year limitation period under s. 38(3) of the Trustee Act.

[63] The respondent also relies, as did the motion judge, on the decision of the Superior Court in Wilkinson. In Wilkinson, the claimant was the common law spouse of the deceased who owned the house in which the parties lived. The deceased’s will allowed the claimant to live in the house for two years following her death, after which time the house was to be sold and the proceeds would form part of the residue of her estate that she left to her three children. The claimant commenced an application against the estate in which he asked for a declaration that he had a constructive trust as to an equal interest in the property.

[64] The motion judge in Wilkinson relied on this court’s decision in McConnell in considering the “plain meaning” of s. 4 of the RPLA. He reasoned that as the heading of the applicable section in the Trustee Act refers to claims in tort and the claimant’s claim was not a tort but for an interest in property, s. 38 of the Trustee Act did not apply: at para. 22. He determined that “[a] simple analysis is that the [RPLA] is dealing with a right to land, not with a wrong against a person”: at para. 23. He concluded that there was no jurisprudence to demonstrate that the RPLA should not apply in cases of a constructive trust as has already been determined in McConnell. Without further explanation, he did not propose to differentiate between claims against live parties and those against estates.

[65] In my view, Wilkinson is wrongly decided. The motion judge in Wilkinson did not carry out the required analysis of the legislative history and policy and judicial treatment of s. 38 of the Trustee Act and related statutory provisions that I have already referenced. Moreover, as I have already explained, his reading of the provisions of s. 38(2) and (3) of the Trustee Act was in error. Finally, his reliance on McConnell was misplaced because McConnell does not apply to equitable trust claims against estates.

(f) Conclusion

[66] As a result, I conclude that s. 38(3) of the Trustee Act, and not s. 4 of the RPLA, applies to the respondent’s equitable trust claims.

V. Disposition

[67] For these reasons, I would allow the appeal and set aside the motion judge’s order with respect to the respondent’s equitable trust claim. I would declare that the two-year limitation period under s. 38(3) of the Trustee Act applies to the respondent’s equitable trust claim against the estate and the related claims against the Estate Trustee with respect to the equitable trust claim, and that those claims are statute-barred because her action was brought more than two years following Mr. Kulynych’s death. I would therefore dismiss those claims.

[68] As earlier noted, no appeal was taken from the motion judge’s order to extend the time for the respondent to bring her claim for dependant support and that claim, as well as the related claims against the Estate Trustee personally in relation to the dependant support claim, are not dismissed.

[69] I would award the appellants their costs of the appeal from the respondent in the all-inclusive amount of $9,000 and their costs of the motion in the all-inclusive amount of $5,000. I would not make a costs order for or against the intervener.

Released: September 12, 2024 “L.B.R.”

“L.B. Roberts J.A.”

“I agree. B.W. Miller J.A.”

“I agree. S. Gomery J.A.”

Footnotes

[1] The claim against Mr. Loton’s estate was not in issue in the application and the estate remains a respondent in the application. The estate did not take any position before the application judge nor on this appeal.

[2] I should not be taken as agreeing that the equitable trust claim was properly pleaded. One important deficiency is that the absence of a juristic reason for the alleged unjust enrichment was not pleaded. Absent amendment, this is a fatal pleading error. There can be no claim for unjust enrichment without pleading the absence of a juristic reason for the enrichment: Kerr v. Baranow, 2011 SCC 10, [2011] 1 S.C.R. 269, at paras. 3, 31-32; Garland v. Consumers’ Gas Co., 2004 SCC 25, [2004] 1 S.C.R. 629, at para. 30.

[3] As earlier noted, the motion judge assumed that the parties had consented to the filing of evidence. The evidence filed was not consistent on some material points, for example, the respondent claims Mr. Kulynych rented out his house, while the appellants argue this is not supported by the affidavit material. However, the motion judge’s treatment of the limitations period issue before him as a pure issue of law made it unnecessary to make findings of fact or resolve factual disputes arising from the evidence filed.

[4] As I will explain, the motion judge did not take any of the filed evidence into account in making his decision and expressly indicated that he was not addressing the merits of the claim.

[5] See also: Ryan, at para. 31, referencing with approval Waschkowski and this passage.