Court File and Parties

Court File No.: 19-22 Date: 2021-03-04 Ontario Superior Court of Justice

In the Estate of Rose Marie Margaret Roobroeck, deceased and In the Estate of Eric Cyriel Roobroeck, deceased

Between: Rachel Rosita Paula Marie Louise Dewaele, Applicant And: Richard Jules Hector Cyriel Roobroeck and Ronald Roland Robert Richard Roobroeck, Respondents

Counsel: Paul Morrissey, for the Applicant Self-Represented, for the Respondents

Heard: In writing

Costs Decision

The Honourable Justice L. Sheard

Overview

[1] The parties to this application are the beneficiaries and co-estate trustees of the estates of their late parents, Rose Marie Margaret Roobroeck, (“Rose”) and Eric Cyriel Roobroeck (“Eric”). Eric died on August 23, 2016 and Rose died on January 25, 2018.

[2] The applicant commenced this application for directions and other relief respecting the administration of her parents’ estates. The applicant was successful on this application and in my Reasons for Judgment released December 4, 2020 (the “Reasons”), the respondents were removed as co-executors and trustees of Rose and Eric’s estates, leaving the applicant as the sole estate trustee.

[3] The applicant sought her costs of the application.

[4] As per the Reasons, the applicant was to serve and file her costs submissions within 21 days of December 4, 2020. The respondents were to serve and file their responding submissions within 14 days of service upon them of the applicant’s costs submissions.

[5] The applicant’s costs submissions were served and filed upon the respondents as ordered. The respondents did not deliver responding costs submissions. As a result, in determining costs, I have been assisted by the applicant’s costs submissions only.

Position of the Applicant

[6] The applicant seeks full recovery of the costs she incurred in this application and submits that the issue to be determined is what costs should be paid by the respondents and what costs should be charged to the estate.

[7] The applicant identifies three distinct stages of the litigation:

i) Part “A”: commencement of proceedings and negotiations, that culminated in a consent order in August 2019;

ii) Part “B”: preparation for and attendance at a hearing in October 2019, resulting in an order requiring the respondents to provide information and to cooperate with the estate lawyer and accountant; and

iii) Part “C”: when co-operation proved impossible, the parties prepared and delivered supplementary materials referenced in the hearing before me of November 25, 2020.

[8] The applicant allocated the legal fees under each Part (exclusive of taxes and disbursements), as follows: a) fees actually incurred; b) fees calculated on a full indemnity basis; c) fees calculated on as substantial indemnity basis; and d) fees calculated on a partial indemnity basis.

[9] The applicant says that she incurred legal fees (before taxes and disbursements) of $93,865. However, in the applicant’s Bill of Costs, she shows full indemnity fees of only $66,057. The applicant explains that the lower amount claimed for full indemnity fees includes fees she incurred relating to the application and “occasioned by the respondents' intransigence” but excludes fees the applicant incurred to further the administration of the estate. The applicant stated that the full indemnity fees were also reduced to achieve an amount that was "reasonable" having regard to the relevant jurisprudence that costs must be "fair and reasonable": see Boucher v. Public Accountants for the Province of Ontario (2004), , 71 O.R. (3d) 291 (C.A.).

[10] In the applicant’s Bill of Costs, the applicant has calculated her costs on a full indemnity, substantial indemnity, and partial indemnity basis, as follows:

a. full indemnity costs of $78,802.63, comprised of fees of $66,057.50, plus disbursements and HST;

b. substantial indemnity costs of $71,335.13, (90% of the full indemnity fees), plus disbursements and HST; and

c. partial indemnity costs of $48,496.77 (65% of the full indemnity fees) plus disbursements and HST.

[11] For the purposes of fixing the costs on this application, I refer to the costs as set out in the applicant’s Bill of Costs.

[12] The applicant seeks an order that her substantial indemnity costs be paid by the respondents and that the balance of her full indemnity costs be paid by the estates. Specifically, the applicant asks that the costs awarded against the respondents be fixed at $71,000 “without prejudice to the applicant charging legal costs over and above that amount against the estates as unavoidable and necessary costs of furthering the administration of the estates.”

The Law

[13] With respect to fixing costs, the starting point is s. 131 of the Courts of Justice Act, R.S.O. 1990, c. C.43 as amended, which provides that, subject to the provisions of an Act or rules of court, costs are in the discretion of the court, which may determine by whom and to what extent the costs shall be paid.

[14] The overriding objective in a cost award is that it be fair and reasonable. In part, what is reasonable is determined by the expectations of the parties, and, in particular, the reasonable expectations of the losing party:

[15] The general rule is that estate trustees are entitled to be indemnified for costs reasonably incurred in the administration of the estate: see Geffen v. Goodman Estate , [1991] 2.S.C.R. 353, at 390-1; Sawdon Estate v. Watch Tower Bible and Tract Society of Canada , 2014 ONCA 101 ; 119 O.R. (3d) 81; and Brown v. Rigsby , 2016 ONCA 521 ; 350 O.A.C. 236.

[16] The “loser pays” costs regime applies to estate matters: see McDougald Estate v. Gooderham (2005), , 255 D.L.R. (4th) 435 (Ont. C.A.). As explained by Gillese J.A. in Neuberger Estate v. York , 2016 ONCA 303 , 131 O.R. (3d) 143, at paras. 24 and 25 , a blended cost award - in which a portion of the costs is paid by the litigants and a portion from the estate - is within the court’s discretion:

[24] In estates litigation in Ontario, the historical approach to costs has been displaced in favour of one in which the costs rules in civil litigation apply both at first instance and on appeal, unless the court finds that one or more of the relevant public policy considerations dictate that costs (or some portion thereof) should be paid out of the assets of the estate: McDougald Estate v. Gooderham (2005), , 255 D.L.R. (4th) 435 (Ont. C.A.) , at para. 80 ; see also Sawdon Estate v. Sawdon , 2014 ONCA 101 , 370 D.L.R. (4th) 686 , at para. 101 . The public policy considerations at play in estate litigation are primarily of two sorts: (1) where the difficulties or ambiguities that give rise to the litigation are caused, in whole or in part, by the testator; and (2) the need to ensure that estates are properly administered.

[25] Blended costs awards, in which a portion of costs is payable by the losing party and the balance is payable out of the estate, are available at first instance and on appeal, in the discretion of the court, where one or more of the relevant public policy considerations are found to be engaged: Sawdon , at paras. 93-100 and 107 .

Analysis

[17] My jurisdiction to fix and award costs is limited to the costs claimed and related to this application. In her costs submissions, the applicant has stated that the full indemnity costs of $78,802.63 set out in her Bill of Costs is intended to represent the costs incurred in respect of the application “occasioned by the respondents’ intransigence” and also represents a “reasonable” cost outline for cost attribution purposes. On that basis, I use the figure of $78,802.63 as the applicant’s full indemnity costs.

[18] Rule 57.01 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, sets out factors that I may consider in exercising my discretion. Overall, the objective is to fix an amount that is fair and reasonable, having regard for, among other things, the expectations of the parties concerning the quantum of costs: see Boucher , at paras. 26 and 38 .

[19] The applicant asks for substantial indemnity costs from the respondents. Such an award is authorized under r. 57.01(4)(c) and may be awarded “where the losing party has engaged in behaviour worthy of sanction”: see Davies v. Clarington (Municipality) , 2009 ONCA 722 , 100 O.R. (3d) 66 , at para. 28 . Elevated costs should only be awarded where “there has been reprehensible, scandalous or outrageous conduct on the part of one of the parties” : see Young v. Young , [1993] 4 S.C.R. 3 , at p. 134 .

[20] In the Reasons, I found that the respondents, to the detriment of the beneficiaries of the estate, had i) not fulfilled their obligations as co-estate trustees; ii) preferred their own self-interest; iii) failed to comply with court orders, even orders made on consent; iv) refused to take any meaningful steps to facilitate the realization of the estate; and, v) by their conduct, brought the administration of the estate to a standstill. For those and other reasons set out in the Reasons, the respondents were removed as estate trustees.

[21] The respondents both failed in their obligations as estate trustees and, as noted above and in the Reasons, they deliberately interfered with the applicant’s ability to complete the administration of the estates. But for the conduct of the respondents, no litigation would have been necessary. Moreover, the respondents should have complied with previous court orders made, especially those made on consent. They did not.

[22] In my view, the respondents’ conduct is worthy of sanction and can be characterized as reprehensible and outrageous. For that reason, I conclude that it is proper for me to exercise my discretion to award costs against the respondents on an elevated scale.

[23] While I have not had the benefit of costs submissions from the respondents, I have still considered the r. 57.01 factors which include, among other factors, the amounts involved - the estates are worth an estimated $2.8 million; the experience of counsel, the time spent and the hourly rates charged; the conduct of the parties that tended to shorten or lengthen the duration of the proceedings. I have also considered that the respondents were self-represented, which increased the burden on the applicant’s lawyer, who prepared orders, and who provided a factum and brief of authorities for use by the court.

[24] I also take into account that the first order, under Part “A”, was made on consent, albeit after the application was brought.

Disposition

[25] I find that the applicant, as a co-estate trustee, is entitled to be fully indemnified for the costs she incurred in respect of this application, namely $78,802.63, inclusive of disbursements and HST.

[26] As the unsuccessful parties in this application, the respondents are liable to pay a portion of the applicant’s costs, which I fix in the amount of $60,821.50, as explained below:

a) as the time spent under Part “A” relates to the application and resulted in a consent order, I conclude that costs should be awarded on a partial indemnity basis; and

b) based on the conduct of the respondents referenced earlier in this decision, I find that costs awarded against the respondents with respect to Part “B” and Part “C” should be awarded on a substantial indemnity basis.

[27] For the above reasons, I order as follows:

i) the respondents shall pay costs to the applicant in the total amount of $60,821.50 calculated as follows:

i) Fees for Part “A”: $18,062.00 ii) Fees for Part “B”: $ 8,878.00 iii) Fees for Part “C”: $23,205.00 iv) HST on fees (13% x $50,145.00) $ 6,518.85 v) Disbursements (incl. HST) $ 4,157.65 TOTAL: $60,821.50

a. the balance of the applicant’s costs in the amount of the $17,981.13 ($78,802.63 - $60,821.50) shall be paid from the assets of the estate of Eric and/or Rose, as may be determined by the applicant.

Justice L. Sheard DATE: March 4, 2021