COURT FILE NO.: CV-20-0000313-0000 DATE: 2023 04 25
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Ellen Deborah Korsch, Executor and Trustee of the Estate of Gertrude Ilse Hildebrandt v. Berndt Walter Hildebrandt, Ellen Frances Dunlop and Grace Frances Hildebrandt
BEFORE: Fowler Byrne J.
COUNSEL: Christopher Shorey, for the Applicant Liliana Carvalho, for the Respondents
HEARD: March 7, 2023
E N D O R S E M E N T
[1] The Applicant, Ellen Deborah Korsch (“Ellen”), as estate trustee of the estate of her mother Gertrude Ilse Hildebrandt (“Gertrude”), seeks an order that the Respondents vacate a property owned by Gertrude, and that she be paid occupation rent by the Respondents until that time.
Background
[2] Ellen and the Respondent, Berndt Walter Hildebrandt (“Berndt”) are Gertrude’s only children. At the time of her death, Gertrude did not have a spouse. In her will, Gertrude appointed Ellen as her trustee and named her the sole beneficiary of her estate. Berndt was specifically excluded in the will by Gertrude. In her will, Gertrude explained that this was due to the money she had already provided to Berndt during her lifetime.
[3] Gertrude died on March 7, 2019. Ellen was appointed Estate Trustee with a Will, on October 31, 2019. At the time of Gertrude’s death, Gertrude was residing with Berndt, Berndt’s wife, Ellen Frances Dunlop (“Dunlop”), and their daughter, Grace Frances Hildebrandt (“Grace”). This property was municipally located at Unit 18, 3125 Fifth Line West, Mississauga (“the Property”). As indicated, Gertrude was the sole owner of the Property.
[4] On May 14, 2019, approximately six months prior to her appointment as Estate Trustee, Ellen served notice on Berndt and his family to vacate the Property so that she could sell it and realize on her inheritance. Berndt and his family refused to move. This Application was commenced. It was unfortunately adjourned on a number of occasions and was delayed by the court closures during the pandemic.
[5] It has now been almost four years since Berndt and his family were asked to vacate, and they have only now agreed to leave by April 30, 2023. In the meantime, Ellen has been paying almost all the upkeep on the house, including paying off the secured line of credit, the property taxes, insurance, electricity, and water. As of the date of this hearing, she has provided evidence of expenditures exceeding $47,000. However, Ellen does not want reimbursement of these expenses; instead, she seeks occupation rent from the date she asked Berndt to leave, in the approximate sum of $138,000.
Request for Adjournment
[6] At the commencement of this hearing, the Respondents sought an adjournment. This was not their first request. This application was last returnable on December 16, 2022. On that day, the Respondents asked for an adjournment. The adjournment was granted by Justice Dennison, peremptory to the Respondents. A timetable was also ordered for the service of materials. The Respondents had until February 17, 2023, almost two months, to serve their responding materials.
[7] On the day of this hearing, the Respondents’ counsel advised that they were only retained on February 15, 2023, and were only made aware of Justice Dennison’s timetable around that time. Nonetheless, they accepted the retainer. They requested an adjournment for multiple reasons. First, they wished an opportunity to respond. They also believed that there were triable issues, that cross-examinations may be necessary, and that a long motion date was required. Second, they disputed the admissibility of the evidence of a real estate agent as an expert in assessing rental values. They argued that there would be no prejudice to the Applicant as the Respondents agreed to vacate by the end of April 2023. Third, they alleged that Grace may be under a disability and the appointment of a litigation guardian may be necessary. Finally, the lawyer who was to assume carriage was to be out of the country.
[8] The granting of an adjournment is a discretionary remedy: Toronto-Dominion Bank v. Hylton, 2010 ONCA 752, at para. 36. In considering an adjournment, the judge must consider all the relevant considerations in balancing the competing interests and make a decision that is in the interests of justice: Sewbans v. Sewbans, 2020 ONCA 559, at para. 7; Hylton, at para. 37.
[9] Also, in deciding whether to grant an adjournment, the court should consider the strength of the evidence, the reason for the adjournment request, and the history of the matter, including any deliberate delay or misuse of the court process. I must also consider the prejudice to the party resisting the adjournment and the consequences to the requesting part of refusing to grant the adjournment: Hylton, at para. 38.
[10] Unfortunately, I do not find that an adjournment is appropriate. This matter was already adjourned peremptory to the Respondents. It is not clear why they waited two months before retaining counsel, and how they expected counsel to review the file in its entirety and prepare meaningful responding materials on such short notice. This is also not a surprise to their counsel. They accepted this retainer knowing of the deadline to file materials and the return date of this Application. Despite this, counsel did manage to serve and file an affidavit and factum, but only addressing the need for an adjournment. No substantive evidence was presented.
[11] In addition, I have considered that this matter has been ongoing for over three years. I do acknowledge that up to December 2022, the Applicant was only seeking vacant possession and an order for the contents of the Property. Nonetheless, during all those years, the Respondents never filed any responding materials that could contain evidence about what efforts or expenditures they have put into the Property in the last three years. They never commenced an application of their own seeking reimbursement of any expenditures.
[12] When the parties appeared before Justice Dennison on December 16, 2022, the Applicant made it known that she was seeking to amend her application. The Respondents were given time to respond. The Respondents were urged to consult with counsel immediately. Justice Dennison noted the Applicant’s argument that the Respondents were evading service, so she granted service by email.
[13] The Applicant abided by the new filing deadline and the Respondents have known the details of her claim from at least January 30, 2023. There was nothing stopping the Respondents from making efforts to retain counsel immediately after December 16, 2023, so that counsel could start gathering the necessary evidence. Again, nothing was done.
[14] The Applicant has suffered prejudice by this delay. While the Respondents have agreed to finally vacate, that does not address the prejudice of the last three years, where the Applicant missed out on an elevated real estate market and had to expend more resources than she should have on maintaining the Property. There is really no way of knowing exactly how much the Applicant could have sold the property for at any given time because the Respondents prevented her from doing so.
[15] By proceeding today, the Respondents will be ordered to leave, but they have already agreed to. It is not clear how they could have resisted the Writ of Possession.
[16] The Respondents have claimed that they expended money on the Property and as a result, the value of the Property has increased. Unfortunately, no evidence was served that would substantiate this. It would not have been difficult to have at least attached a few receipts to an affidavit. They have had years to do so but chose not to. Also, even if this evidence was forthcoming, it is not clear what impact it would have. Any day to day costs associated with living in the Property should be born by the occupants. Any damages they caused, should be paid for by them. Again, unless these expenditures were incurred only in 2023, it is not clear why no evidence was ever proffered to substantiate this claim.
[17] Also, as will be seen below, Ellen’s claim for occupation rent is grounded in the Respondents’ unjust enrichment. It is not clear what evidence the Respondents could present that could prove that they did not enjoy a substantial benefit since 2019 by living in the Property practically expense free, or that Ellen was not deprived of the benefit of possessing her own Property.
[18] I am also considering not only the delay to the Applicant, but the impact of continual adjournments on the administration of justice. The court is overburdened. Litigants are waiting months for a motion date and years for a trial. It is not reasonable for the Respondents to assume all other litigants should wait behind them while they get around to responding to the Application.
[19] With respect to the claim that Grace is under a disability, I have no evidence of this. The Respondents’ responding affidavit was sworn by a student-at-law with the Respondents’ counsel’s law firm. He only states that Grace may have a disability, with no details. In the Respondents’ factum, they argue that Grace suffers from autism spectrum disorder and treatment-resistant schizophrenia, along with a non-verbal learning disability and social phobia. This statement is not supported to any degree in the evidence whatsoever. In addition, although arguing that the Public Guardian and Trustee may need to be involved, it was not served with the Respondents’ materials. Surely, if Grace has been living with such disabilities, there must have been something – a prescription, a doctor’s note or hospital admission report, or even a school report card, which could have supported this claim. Again, nothing was served or filed.
[20] Also, when this matter was originally argued on December 16, 2023, the Respondents stated that they needed to appoint a litigation guardian for Grace. That was one of the reasons they requested an adjournment. In her endorsement of that day, Justice Dennison advised the Respondents that they needed to take those steps right away. For some unknown reason, they did nothing for a further two months.
[21] Accordingly, I am denying the Respondents’ request for an adjournment, and will decide the matter on the materials before me.
Entitlement to Occupation Rent
[22] Although the concept of occupation rent is more widely known in the family law context, it was originally developed in the commercial context. When someone occupies a property and by doing so excludes another party with an interest in the property, occupation rent is an equitable remedy that is available to the court in appropriate circumstances to achieve fairness between the parties: Dagarsho Holdings Ltd. v. Bluestone (2004), aff’d (2005) 37 R.P.R (4th) 53 (Ont. C.A.); Dosu v. Dosu, 2022 ONSC 5053, at para. 162.
[23] In Dagarsho, Justice Karakatsanis (as she then was), found that a mother was entitled to occupation rent from her adult son on the basis of trespass and unjust enrichment. The monthly rent was based on the actual market rent received and deducted the expenses paid for by the son. Citing Young v. Bank of Nova Scotia (1915), 34 O.L.R. 176 (Ont. C.A.), Justice Karakatsanis stated at para. 26:
Occupation rent is an equitable remedy. The often cited general principle of occupation rent is that “if a person is in occupation without a lease, although the relationship of landlord and tenant will not exist, the law will imply a contract for payment to the landlord or a reasonable amount for the use and occupation of his land.” The principle is based upon the presumption that the parties have agreed to reasonable compensation. That presumption can be rebutted by evidence that the parties intended that the occupation be without compensation. [Citations omitted.]
[24] In determining the value of the occupation rent, Justice Karakatsanis accepted the evidence of the rent that was charged for the identical unit next door. There is no indication that expert evidence was considered.
[25] In Bergmann v. Amis Estate, 2010 ONSC 993, at paras. 37-39, Justice Daley found that occupation rent is an equitable remedy related to and arising in circumstances of unjust enrichment. The entitlement to occupation rent arises where those entitled to the property have been ousted. In order to be granted occupation rent, you must show that the party improperly occupying the property was unjustly enriched.
[26] Calmusky Estate v. Calmusky, 2020 ONSC 1506, at para. 73, also recognized that occupation rent is appropriate when persons continue to occupy property when not entitled to do so after the deceased’s death to the exclusion of the rightful beneficial owner. The court was required to determine whether the occupying party was unjustly enriched.
[27] In Filippelli Estate v. Filippelli, 2017 ONSC 4923, that situation is not unlike this, in that a son of the deceased remained in his deceased mother’s house after her death, while not being entitled to do so under the will.
[28] In this case, I find that the Respondents were unjustly enriched in that they occupied the Property without right or without paying any property taxes, insurance, or many of the utilities. At the same time, the Applicant was denied use of the Property to either rent out for income or to sell and invest the proceeds. There was no juristic reason for the Respondents’ occupancy. In these circumstances, the appropriate remedy is the payment of occupation rent.
Quantum of Occupation Rent
[29] Having found that the Applicant is entitled to occupation rent, I must determine the quantum.
[30] In support of her claim, the Applicant has served and filed the affidavit of Blake Shaffer, a real estate agent with Royal LePage Realty Plus Brokerage. In this affidavit, he provided his opinion of the monthly rental value of the Property from 2019 to 2022. This opinion was based on listings of similar properties for the applicable years and the actual rent paid. Based on the information available to him, he provided the low, high, and average monthly rent for a property similar to the Property for these years.
[31] I agree with the Respondents that the affidavit of Mr. Shaffer is not an expert opinion as contemplated by r. 53.03. That being said, the crux of Mr. Shaffer’s evidence is that he provided actual data of what similar houses rented for in the applicable years. I am able to review that data and make my own conclusions of what the Property could have been rented for. Not unsimilar to what was done by Justice Karakatsanis in Dagarsho, I may consider the market rent for a similar property and make my own finding as to the value of the occupation rent.
[32] I have reviewed the listings and paid particular attention to the homes that are the closest to the Property and with a similar number of bedrooms, bathrooms, and other attributes. After reviewing this information, I accept that for 2019, a similar property could rent for $2,650. For 2020, it could rent for $2,800. In 2021, it could rent for $2,500, and in 2022, it could rent for $2,600.
[33] That being said, I do not believe occupation rent should be payable until after the first year following Gertrude’s death. It is not unusual for an executor to have up to a year to collect the assets of the estate and have them ready for disbursement. Accordingly, any occupation rent will not be payable until April 1, 2020.
[34] Also, I acknowledge that there were times, due to the pandemic, that matters remained at a standstill. The Application was originally scheduled for February 2020. Due to the pandemic and the court closure, the Applicant decided to try to negotiate with the Respondents and their lawyer at that time. The Respondents’ lawyer was discharged in October 2020, and the Applicant heard nothing further form the Respondents. It appears that the Applicant then amended the Notice of Application in October 2022, to have it returnable on December 16, 2022.
[35] There is little evidence of what efforts Ellen made to have the Respondents move out between October 2020 and October 2022. The courts were reopened in the fall of 2020 and were able to proceed remotely for the following years. There is no reason why the Applicant could not have brought this application forward on a timelier basis. Equity cannot allow someone to profit from their failure to act. Accordingly, the occupation rent payable should be reduced by half the amount during this period, to account for her equal responsibility to prosecute the matter in a timely manner.
[36] I am also not prepared to make any monetary order as against Grace. While an adult, she was there with her parents who made the decision as to where to live. The Applicant has not satisfied me that Grace should be monetarily responsible for occupation rent.
[37] I am also not prepared to award Ellen any reimbursement for the expenses she incurred, such as for property tax, insurance, or utilities. She alone will enjoy the benefit of these expenditures, as the homeowner. Also, Gertrude told Ellen that she was to pay off the secured line of credit, which was taken out to advance Berndt funds while she was alive. As owner, she must also bear the responsibility of any repairs that must be made to the home before it can be sold.
[38] Accordingly, I find occupation rent is payable as follows:
| Year | Months | Number of Months | Monthly Amount | Total |
|---|---|---|---|---|
| 2020 | April to October | 7 | $2,800.00 | $19,600.00 |
| 2020 | Nov. to Dec. | 2 | $1,400.00 | $2,800.00 |
| 2021 | all | 12 | $1,250.00 | $15,000.00 |
| 2022 | Jan. to Sept. | 9 | $1,300.00 | $11,700.00 |
| 2022 | Oct. to Dec. | 3 | $2,600.00 | $7,800.00 |
| 2023 | Jan. to April | 4 | $2,600.00 | $10,400.00 |
$67,300.00
Costs
[39] I have reviewed the Costs Outline submitted by the Applicant.
[40] The Applicant has been successful for the most part, though not to the degree she sought. The hourly rate charged is on the high end of reasonable. Counsel appropriately disclosed the discount provided to the client.
[41] Having considered the work done, I find that the hours claimed are reasonable. I have been provided with no Offers to Settle, so I see no reason why costs should exceed partial indemnity.
[42] Accordingly, it is fair and proportionate that the Applicant be awarded costs in the sum of $25,160.
Conclusion
[43] For the foregoing reasons, I made the following orders:
a) the Respondents request for an adjournment is denied;
b) the Respondents shall deliver up vacant possession of the Property to the Applicant on or before April 30, 2023;
c) the Applicant shall be and is hereby granted leave to have a Writ of Possession issued if the Respondents fail to deliver up vacant possession of the Property by April 30, 2023;
d) the Respondents to deliver all furnishings, household contents, and other chattel property belonging to the late Gertrude Ilse Hildebrandt, which were located in and on the Property at the time of her death;
e) the Sheriff of the Regional Municipality of Peel is directed to enforce the Writ of Possession issued pursuant to paragraph 43(c) above;
f) the Respondents, Berndt and Dunlop, jointly and severely, are to pay Ellen occupation rent for occupying the Property from April 1, 2020, to April 30, 2023, in the amount of $67,300;
g) if the Respondents vacated on or before March 31, 2023, this sum will be reduced by $2,600;
h) if the Respondents, or any one of them, fail to deliver up vacant possession of the Property by April 30, 2023, then Berndt and Dunlop must pay Ellen additional Occupation Rent in the amount of $2,600 per month until vacant possession has been delivered;
i) notwithstanding this Application and any order or judgment resulting from it, Ellen, in her personal capacity or on behalf of the Estate of the late Gertrude Ilse Hildebrandt, may subsequently seek from the Respondents, or any one of them, that they pay all reasonable costs to repair any damage to the Property caused by the Respondents’ actions or neglect; and
j) Berndt and Dunlop, jointly and severally, shall pay Ellen’s costs of this Application in the amount of $25,160, inclusive of fees, disbursements, and taxes, payable within 30 days of this endorsement.
Fowler Byrne J. DATE: April 25, 2023