COURT OF APPEAL FOR ONTARIO

DATE: 20001222

DOCKET:C29921

MORDEN, GOUDGE AND FELDMAN JJ.A.

BETWEEN:

WERNER BRUMMUND

Neil A. Kaufman

for the appellant

Appellant

(Plaintiff)

• and -

IRENE BAUMEISTER, Executrix

John A. Harder

And Trustee of THE ESTATE OF

for the respondent

HEINZ BAUMEISTER, DECEASED

And IRENE BAUMEISTER,

PERSONALLY

Respondents

(Defendants)

Heard: November 9

and 10, 2000

On appeal from the judgment of Justice Gordon G. Nicholls dated May 8, 1998, made at the City of Kitchener.

GOUDGE J.A.:

[1] In this action Werner Brummund, the appellant, sued Irene Baumeister, the respondent, personally and as executrix of her late husband’s estate. Mr. Brummund, sought repayment of two sums, 20,000 Deutschemarks (“DM”) and 27,618 DM, which he said were loans which he had made to Mr. Baumeister.

[2] At trial, Nicolls J. dismissed the claim for the 20,000 DM loan, but granted judgment against the estate for the 27,618 DM loan. He dismissed the claim against Mrs. Baumeister personally.

[3] Mr. Brummund appeals from the dismissal of the claim on the smaller loan and of the claim against Mrs. Baumeister personally. There is a cross-appeal from the judgment granted on the larger loan. For the reasons that follow, I would dismiss both the appeal and the cross-appeal.

[4] First, as to the appellant’s claim for repayment of the alleged loan of 20,000 DM, the trial judge found that the appellant’s evidence of a loan to Mr. Baumeister was not corroborated by other material evidence and, in essence, was not proven. The conclusion that the appellant had not proven the loan was, in my view, a reasonable one on the record and one with which this court cannot interfere. This claim by the appellant was properly dismissed.

[5] I would reach the same conclusion on the respondents’ cross-appeal. The finding of the trial judge that the appellant had satisfactorily proven the loan of 27,618 DM to Mr. Baumeister is reasonable given the evidence at trial. This court ought not to interfere with it. The judgment against the estate for this amount must stand.

[6] The appellant also claims against Mrs. Baumeister personally, arguing that she is personally liable to him for this debt. He bases this on three submissions.

[7] First, the appellant says that the trial judge erred in permitting the respondent, at the conclusion of the trial, to amend the defence to plead that there were no funds in her late husband’s estate. Without such an amendment, the doctrine of plene administravit would render Mrs. Baumeister as executrix personally liable for this debt of the estate.

[8] In Commander Leasing Corp. Ltd. v. Aiyede (1983), 1983 1649 (ON CA), 44 O.R. (2d) 356 (Ont. C.A.) at 358 Robins J.A. explained the doctrine of plene administravit as follows:

It has long been established that if an executor or administrator has no assets to satisfy the debt upon which an action is brought, in the absence of a plea of no assets or plene administravit, he will be taken to have conclusively admitted that he has assets to satisfy the judgment and will be personally liable for the debt and costs if they cannot be levied on the assets of the deceased. If the executor has some, but insufficient, assets to satisfy the judgment and costs, a plea of plene administravit praeter will render him liable only to the amount of assets proved to be in his hands as executor: see Re Marvin, [1905] 2 Ch. 490; Marsden v. Regan, [1954] 1 All E.R. 475; Schneitzer v. Breckon (1921), 20 O.W.N. 22; and see also, Williston and Rolls, The Law of Civil Procedure, vol. I (1970), p. 172.

The learned authors of Williams on Executors, 16th ed. (1982), (now Williams, Mortimer ad Sunnucks on Executors, Administrators & Probate), in discussing this point strike a cautionary note, emphasizing at p. 803 that:

If a personal representative has not assets to satisfy the debt, upon which an action is brought against him, he must take care to plead plene administravit or plene administravit praeter, etc. For it seems that, even under the present system of pleading, if a personal representative fails to plead that he has fully administered the assets, or that with the exception of certain assets he has fully administered, and the judgment, whether by default or otherwise, is given for the plaintiff, this amounts to a conclusive admission that he has assets to satisfy judgment.

[9] While the respondent did not plead plene administravit in her statement of defence, she moved to do so at the close of trial. Nicholls J. permitted the amendment because the evidence at trial made clear that there was no money in the estate and there was no prejudice to the appellant in allowing the amendment.

[10] In my view there is no basis to interfere with this determination. The trial judge had just concluded the case when he permitted the amendment, and he was in the best position to determine if prejudice to the respondent would result from it.

[11] Moreover, the appellant had also advanced the claim that the respondent, knowing of the appellant’s claim, had dissipated the estate and therefore as executrix was personally liable for the estate’s debts. This plea of devastavit meant that the history of the administration of this estate was fully scrutinized at trial. The evidence made clear that the estate, which was never substantial, had been fully administered by the time the action was commenced. In these circumstances, where the facts relevant to the plea of plene administravit were canvassed at trial, permitting the amendment at the close of trial could not be said to have prejudiced the appellant.

[12] Having been allowed to plead plene administravit and the evidence having demonstrated an estate without assets, this argument for the personal liability of the respondent must fail.

[13] The appellant’s second argument for the personal liability of Mrs. Baumeister is that of devastavit – that is, that as executrix she distributed the estate in the face of the appellant’s claim, contrary to the duty imposed on her and she is therefore personally liable for the debt of the estate. Here too the trial judge’s findings of fact are a complete answer. He concluded simply and categorically that he could find no wrong-doing on the part of the respondent as executrix. Indeed, he found that she did not know of the appellant’s claim until after the modest estate had been fully distributed. These findings are amply supported on the evidence and must stand. This argument also fails.

[14] Finally, the appellant argues that, under the Trustee Act, R.S.O. 1990, c.T.23, s.53 he as creditor can pursue the assets of the estate into the hands of Mrs. Baumeister as beneficiary of the estate. In particular, the appellant focuses on a payment of $100,000 which he says was received from the estate by her as beneficiary.

[15] In my view this argument cannot succeed. This basis for the personal liability of Mrs. Baumeister was neither pleaded by the appellant nor addressed by the trial judge. It is too late to raise it for the first time in argument before this court. In any event, the argument would seem doomed to failure. In the context of analyzing the history of the administration of the estate, the trial judge dealt with the $100,000 received by Mrs. Baumeister and found as a fact that the money was received in her personal capacity and not as payment from the estate to her as beneficiary. This finding is a reasonable one, given this record, and would fully answer this argument.

[16] In conclusion, I would dismiss the appeal and the cross-appeal, both with costs.

Released: December 22, 2000 “JWM”

“S.T. Goudge J.A.”

“I agree: J. W. Morden J.A.”

“I agree K. Feldman J.A.”