Strean v. Hartfam Holdings Ltd., 2006 ONCA 266

DATE: 20060112

DOCKET: C43402

COURT OF APPEAL FOR ONTARIO

WEILER, ROSENBERG and GILLESE JJ.A.

B E T W E E N :

SHIRLEY STREAN, Estate Trustee of the Estate of JACOB HARTMAN, deceased, and SHIRLEY STREAN

Stephen Victor, Q.C. and Angela Holland for the respondents

Plaintiffs (Respondents)

• and -

HARTFAM HOLDINGS LTD., MARK HARTMAN, LORNE HARTMAN and RISA MALLORY

Benjamin Zarnett and Francy Kussner for the appellants

Defendants (Appellants)

A N D B E T W E E N :

HARTFAM HOLDINGS LTD.

Plaintiff by Counterclaim

• and -

SHIRLEY STREAN

Defendant to the Counterclaim

HEARD: September 13, 2005

On appeal from the order of Justice Catherine Aitken of the Superior Court of Justice dated April 8, 2005.

GILLESE J.A.:

OVERVIEW

[1] Jacob Hartman (“Jack”) and his second wife, Shirley Strean, lived together in a condominium on Echo Drive in Ottawa until Jack’s death in 2003. In 2001, Jack and Shirley started an action (the “main action”) in which they claim that Jack’s three children from his first marriage (the “individual appellants”) prevented Jack from buying two condominiums for Shirley. They also allege that the individual appellants wrongfully removed Jack as the executor and trustee of his first wife’s estate.

[2] In 2005, Shirley Strean, acting as the estate trustee of Jack Hartman’s estate and also on her own behalf as a beneficiary under Jack’s will (“the respondents”), successfully brought a motion for leave to amend the fresh statement of claim in the main action to include a declaration that Jack Hartman’s estate was entitled to ownership of the Echo Drive condominium on the basis of a resulting or constructive trust (the “proposed trust claims”).

[3] The appellants appeal from the order of the motion judge granting leave to amend. For the reasons that follow, I would dismiss the appeal.

BACKGROUND

[4] The following facts have been taken from the draft amended fresh statement of claim.

The Parties

[5] Mark Hartman, Lorne Hartman and Risa Mallory, the individual appellants, are the children of Jack and his first wife, Frances Hartman. Mark Hartman is a lawyer.

[6] Jack was a successful businessman and entrepreneur in Ottawa. He operated retail clothing establishments. He also acquired and managed commercial real estate interests in Ottawa. In 1976, Jack incorporated Hartfam Holdings Ltd., the corporate appellant and an Ontario corporation, as a vehicle for holding and managing his real estate properties. He was Hartfam Holdings Ltd.’s sole director and controlling mind until 2000. Since 2000, Mark Hartman has been Hartfam Holdings Ltd.’s sole director.

[7] The respondents are Shirley Strean, acting as the estate trustee of the Estate of Jack Hartman, and Shirley Strean in her personal capacity as a beneficiary under Jack’s will.

Purchase and Occupation of the Echo Drive condominium

[8] Jack and his first wife, Frances, owned and occupied a house on Elvina Street in Ottawa, as joint tenants.

[9] In October of 1983, Jack entered into an Agreement of Purchase and Sale for the purchase of the Echo Drive condominium. The purchase price for the Echo Drive condominium was $315,000.

[10] Jack and Frances sold the Elvina Street property on May 23, 1984.

[11] Jack used the net sale proceeds from the Elvina Street property of approximately $119,000, together with at least $115,217 borrowed from Hartfam Holdings Ltd., to pay for the condominium. Jack directed that title to the condominium be registered in Frances’s name. He later repaid the borrowed funds to Hartfam Holdings Ltd.

[12] Jack and Frances occupied the Echo Drive condominium as their matrimonial home until Frances’s death in 1985. Jack continued to live in the Echo Drive condominium after Frances’s death.

[13] Shirley began living with Jack in the Echo Drive condominium in March 1988. They were married in 2001 and lived together in the Echo Drive condominium until Jack’s death in 2003. Shirley continues to reside in the condominium.

[14] On several occasions in 2000 and 2001, Jack told Shirley that he wished to provide her with benefits and security and to compensate her for the years of care, companionship and assistance that she had given him. To that end, he wanted to purchase two condominium residences for her, one in Ottawa and the other in Florida. The condominiums were to be paid for from the assets of Hartfam Holdings Ltd.

Administration of Frances Hartman’s Estate

[15] In 1979, while Frances and Jack were still living in the Elvina Street property, Frances executed a will in which she named Jack executor and trustee of her estate. By the terms of her will, she gave Jack a life interest in the Elvina Street property and in the residue of her estate. The remainder interest in the residue was to be divided into three equal shares and distributed to the individual appellants on Jack’s death. Paragraph IV of Frances’s will gave her executor and trustee an unfettered right to encroach on the capital of the residue of the estate for Jack’s personal benefit. As the will predated the purchase of the Echo Drive condominium, it made no specific reference to that property.

[16] Mark Hartman acted as solicitor for his mother’s estate. Jack asked Mark to transfer title to the Echo Drive condominium to him personally, not as executor and trustee of Frances’s estate. Mark responded to Jack’s request in a letter dated November 13, 1985, which read, in part, as follows:

When I last spoke to you about the estate, you indicated that you wished that the condominium unit at 111 Echo Drive be transferred to you.

I draw your attention to paragraph 3(c) of the Will which you can find on page 3 which as you will note talks about your use and occupation of 9 Elvina Street.

Should you still require that the condominium unit be transferred to your name alone, I will require the consents of Risa and Lorne in order to resist any requisition later brought by a prospective purchaser from yourself.

I might add that you, as executor, can always sell the condominium unit without the necessity of transferring the unit into your name.

[17] Mark arranged for title to the Echo Drive condominium to be registered in Jack’s name as executor and trustee of Frances’s estate.

Jack’s Removal as Executor and Trustee of Frances’s Estate

[18] In the main action, the respondents allege that starting in the summer of 2000, the individual appellants - and Mark Hartman in particular - conspired to engage in a deliberate plan to deprive Jack from accessing the assets and resources at his disposal, including the assets of Frances’s estate and those of Hartfam Holdings Ltd., in order to frustrate Jack’s intention to provide for Shirley.

[19] On June 3, 2000, Mark Hartman is alleged to have presented Jack with an affidavit and instructed him to sign it. Jack signed the affidavit in which he purported to consent to relinquish his role as executor and trustee of Frances’s estate. It is alleged that the individual appellants obtained Jack’s signature without his knowledge, approval or understanding and without having given him any proper explanation as to the nature and content of the affidavit. Jack did not ask any questions or have the benefit of independent legal advice before he signed the affidavit.

[20] Based on the affidavit, the individual appellants obtained an order from Polowin J., dated July 21, 2000, removing Jack as executor and trustee of Frances’s estate and naming them as the succeeding executors and trustees.

Procedural History

[21] In November 2001, Jack and Shirley commenced the main action in which it is alleged that the individual appellants wrongfully prevented Jack from using $1,000,000 from the property or assets of Hartman Holdings Ltd. to buy two condominiums for Shirley. It is also alleged that the individual appellants conspired to wrongfully remove Jack as executor and trustee of Frances’s estate in order to prevent Jack from using the assets of Frances’s estate and to protect their shares in their mother’s estate.

[22] In his will executed in November 2002, Jack named Shirley as his sole executor and trustee. He left Shirley the Echo Drive condominium, saying at para. 5(b) of his will:

At present I am engaged in litigation which, if successful, could result in my obtaining ownership of my condominium residence … in Ottawa. If at my death I own or am entitled to the ownership of that residence, I bequeath all my right, title and interest therein to my wife, SHIRLEY STREAN, if she survives me by fifteen (15) clear days.

[23] In March 2005, the respondents brought a motion seeking leave to amend the fresh statement of claim to include a claim for a declaration that the Estate of Jacob Hartman is entitled to ownership of the Echo Drive condominium based on a resulting or constructive trust. The motion judge granted leave.

[24] The appellants argue that the motion judge erred in granting leave. They ask that the order below be set aside and the respondents’ motion be dismissed. Alternatively, they ask that the order below be made without prejudice to their right to raise the expiry of the limitation period in an amended statement of defence.

THE DECISION BELOW

[25] The motion judge began by setting out Rule 26.01 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, which states that the court shall grant leave to amend a pleading absent prejudice that could not be compensated for by costs or an adjournment. Relying on Daniele v. Johnson (1999), 1999 19921 (ON SCDC), 45 O.R. (3d) 498 (S.C.J. (Div. Ct.)), she noted that the onus is on the moving party to show that the claim sought to be added is tenable at law. The responding party bears the onus of showing that the amendment should be denied because it would result in prejudice that could not be compensated for by costs or an adjournment (Transamerica Life Insurance Co. v. Canada Life Assurance Co. (1995), 1995 7105 (ON SC), 25 O.R. (3d) 106 (Gen. Div.)).

[26] In paragraphs 11 to 13 of the reasons, the motion judge reasoned as follows in concluding that the proposed trust claims were tenable at law.

[11] The facts alleged above, together with s. 14 of the Family Law Act could support a claim by Jack Hartman, during his lifetime, and by his Estate, following his death, that he was the beneficial owner by virtue of a resulting trust of all or at least part of the Echo Drive condominium. The fact that he, as the trustee of Frances Hartman’s estate, had the unfettered right to encroach on the capital of that estate for his own personal benefit, that he allegedly contributed most of the funds used to purchase the Echo Drive condominium and that he allegedly paid for all of the expenses associated with the property over the years while he was in possession of the unit could also support a resulting trust claim in regard to the condominium.

[12] A constructive trust claim can arise where there is an enrichment, a corresponding deprivation and the absence of any juristic reason for the enrichment (Peter v. Beblow (1993), 1993 126 (SCC), 44 R.F.L. (3d) 329 (S.C.C.)). Again the alleged facts that Jack Hartman paid for most of the purchase price of the Echo Drive condominium and all of its expenses until his death could support a constructive trust claim by his estate.

[13] If this court finds that Jack Hartman was the beneficial owner of the Echo Drive condominium at the time of his death, then Shirley Strean, as his estate trustee, would be entitled to have legal title transferred to her as estate trustee. From there, legal title would be transferred to Shirley Strean as a beneficiary under Jack Hartman’s will.

[27] s. 14 of the Family Law Act, R.S.O. 1990, c. F.3 reads as follows:

14. The rule of law applying a presumption of a resulting trust shall be applied in questions of the ownership of property between spouses, as if they were not married, except that,

(a) the fact that property is held in the name of spouses as joint tenants is proof, in the absence of evidence to the contrary, that the spouses are intended to own the property as joint tenants; and

(b) money on deposit in the name of both spouses shall be deemed to be in the name of the spouses as joint tenants for the purposes of clause (a).

[28] Relying on ss. 4 and 5(2) of the Limitations Act, R.S.O. 1980, c. 240 (now ss. 4 and 5(2) of the Real Property Limitations Act, R.S.O. 1990, c. L.15) [^1] (the “Act”), the appellants argued that the limitation period had expired in respect of the proposed trust claims to the Echo Drive condominium as the claims had not been brought within ten years of Frances’s death in 1985.

[29] The motion judge rejected this argument, saying:

[16] … In my view, these sections have no relevance to the fact situation of this case. Putting aside the question of whether these sections apply to resulting or constructive trust claims at all, if they do, they apply only where a claim is being made by someone not in possession of the property. Here Jack Hartman was in possession of the Echo Drive condominium until his death, and Shirley Strean has been in possession of the property since that time.

[19] Even if a limitation period of 6 or 10 years were considered to apply to a constructive or resulting trust claim, it would not be of any assistance to the Defendants.

[20] During his lifetime, through his possession of the property, Jack Hartman was actively exercising a right that was not only consistent with his being a life tenant, but which was consistent also with his being the beneficiary of a resulting or constructive trust in his favour. Potentially more consistent with his being the beneficial owner of the property is the allegation of the Plaintiffs that Jack Hartman paid all of the expenses associated with the property until his death. It is arguable that no possible limitation period relating to the constructive and resulting trust claims started to run until Jack Hartman was no longer in possession of the property; namely, in July 2003, when Mr. Hartman died.

[21] There is another possible starting date to determine whether any limitation period had expired. On June 3, 2000, Jack Hartman signed an affidavit, allegedly presented to him by his son, Mark Hartman, in which he renounced his position as executor and trustee of the estate of Frances Hartman, and in which he agreed that the function of estate trustee be passed on to his three children. Through steps taken on behalf of the Defendants, and in reliance on the affidavit of Jack Hartman, an order was obtained from Polowin J. on July 21, 2000 removing Jack Hartman as estate trustee of Frances Hartman's estate and naming the Defendants as the successor estate trustees. This effectively removed from Jack Hartman's control his ability to encroach on the capital of the estate for his personal benefit, and his ability to transfer legal title of the property from the estate to himself personally - either by virtue of his right to encroach or because he was the beneficial owner of the property through a resulting or constructive trust. Due to these special circumstances, it is arguable that any limitation period that might apply to a constructive or resulting trust claim started to run from July 21, 2000.

[30] The appellants also argued that allowing the amendment would result in non-compensable prejudice, as they would be unable to properly defend the new claims. The prejudice flowed, it was argued, from the deaths of Frances and Jack since they could not be examined about their intentions at the time of the purchase of the Echo Drive condominium.

[31] The motion judge also rejected this argument. In respect of the resulting trust claim, she held that Frances’s and Jack’s intentions regarding ownership of the condominium could be inferred from their actions and documentary evidence. In respect of the constructive trust claim, she noted that while intention was of some relevance, the primary consideration was whether there had been unjust enrichment. Thus, she reasoned, the focus would be on the parties’ respective contributions to the property for which there would be documentary and third party evidence that would minimize any prejudice caused by the deaths. She concluded that it was not at all clear that the deaths would prejudice the appellants and that it was equally possible that the deaths would prejudice the respondents as much as, or more than, it would the appellants.

THE ISSUES

[32] The appellants raise three issues on appeal. These are whether the motion judge erred in:

1. failing to find that, pursuant to ss. 4 and 5 of the Limitations Act, the proposed trust claims are statute barred and therefore not tenable at law;

2. failing to find that permitting the proposed amendments would give rise to non-compensable prejudice to the appellants; and

3. failing to leave the issue of whether the limitation period had expired to be determined at trial.

THE RELEVANT PROVISIONS OF THE LIMITATIONS ACT

[33] s. 4 of the Act creates a ten-year limitation period for an action to “recover” land. It reads 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]

[34] However, if the claimant has been in possession of the land, s. 5(1) of the Act postpones the commencement of the limitation period to the time of dispossession or discontinuance. Where the person claiming the interest in land claims the estate or interest of a deceased person who remained in possession, s. 5(2) postpones the commencement of the limitation period to the date of death. Sections 5(1) and (2) read as follows:

5(1) Where the person claiming such land or rent, or some person through whom that person claims, has, in respect of the estate or interest claimed, been in possession or in receipt of the profits of the land, or in respect of the rent, and has, while entitled thereto, been dispossessed, or has discontinued such possession or receipt, the right to make an entry or distress or bring an action to recover the land or rent shall be deemed to have first accrued at the time of the dispossession or discontinuance of possession, or at the last time at which any such profits or rents were so receive.

5(2) Where the person claiming such land or rent claims the estate or interest of a deceased person who continued in such possession or receipt, in respect of the same estate or interest, until the time of his or her death, and was the last person entitled to such estate or interest who was in such possession or receipt, the right shall be deemed to have first accrued at the time of such death. [emphasis added]

[35] Sections 42 and 43 give trustees the protection of statutory limitation periods except where the claim: is founded on fraud or fraudulent breach of trust to which the trustee was party or privy; is to recover the trust property from the trustee; or, if the trust property has been converted, is to recover the proceeds thereof. The relevant parts of ss. 42 and 43 read as follows:

PART II

TRUSTS AND TRUSTEES

42 This Part applies to a trust created by an instrument or an Act of the Legislature heretobefore or hereafter executed or passed.

43(1) In this section, “trustee” includes an executor, an administrator, a trustee whose trust arises by construction or implication of law as well as an express trustee, and a joint trustee.

(2) In an action against a trustee or a person claiming through a trustee, except where the claim is founded upon a fraud or fraudulent breach of trust to which the trustee was party or privy, or is to recover trust property or the proceeds thereof, still retained by the trustee, or previously received by the trustee and converted to the trustee’s use, the following paragraphs apply:

1. All rights and privileges conferred by any statute of limitations shall be enjoyed in the like manner and to the like extent as they would have been enjoyed in such action if the trustee or person claiming through the trustee had not been a trustee or person claiming through a trustee.

THE NATURE OF THE PROPOSED CLAIMS

[36] Before considering the issues, it is useful to clearly identify the proposed trust claims.

[37] The essence of the proposed trust claims is that because Jack paid for the Echo Drive condominium, he is its beneficial owner even though Frances had legal title to the condominium. His claim to beneficial ownership is based on resulting trust and constructive trust principles.

[38] The facts upon which the proposed trust claims are founded are contained in paras. 39 to 46 of the amended fresh statement of claim:

[39] Prior to Jack Hartman purchasing his condominium residence located at 111 Echo Drive, Suite 504, in the City of Ottawa (the “Echo Drive Condominium”), Jack and his late first wife, Frances Hartman, owned, as joint tenants, a house located at 9 Elvina Street, in the City of Ottawa. Pursuant to Frances Hartman’s Last Will and Testament, she bequeathed a life interest to Jack Hartman in the Elvina Street property.

[40] During his lifetime, Jack Hartman mistakenly presumed that he only had a life interest in his Echo Drive Condominium home pursuant to Frances Hartman’s Last Will and Testament notwithstanding that her Will only expressly bequeathed a life interest in the Elvina Street property and not the Echo Drive Condominium, and that Jack Hartman was owner of the Echo Drive Condominium through a resulting and/or constructive trust.

[41] Further, Jack Hartman did not have a life interest in the Elvina Street property as he was an owner of the Elvina Street property as a joint tenant together with Frances Hartman. Ownership of the Elvina Street property would have been transferred to Jack Hartman as the surviving joint tenant upon Frances Hartman’s death in 1985, if Jack and Frances Hartman as joint tenants had not sold the Elvina Street property on or about May 23, 1984 for the sum of $119,000.00.

[42] The monies from the sale of Elvina Street property were used by Jack Hartman to pay part of the purchase price of the Echo Drive Condominium.

[43] On or about October 1983, Jack entered into an Agreement of Purchase and Sale for the Echo Drive Condominium in the amount of $315,000.00.

[44] Jack Hartman purchased and paid for the Echo Drive Condominium.

[45] Jack Hartman paid for the purchase of the Echo Drive Condominium, in part, with monies in the sum of at least $115,217.00 that he borrowed from Hartfam Holdings, which were repaid in full by Jack by capital dividend to Jack from Hartfam Holdings.

[46] After Jack Hartman purchased the Echo Drive Condominium, he directed that the title to the Echo Drive Condominium be registered in the name of his late wife, Frances Hartman.

[39] The resulting trust claim is based on the legal presumption that a resulting trust arises where one person pays the purchase price for a piece of real property but another person takes title to that property. s. 14 of the Family Law Act provides that the presumption of resulting trust applies to questions of ownership of property between spouses. The presumption can be rebutted by evidence that the purchaser intended to make a gift to the person to whom title was conveyed.

[40] The remedial constructive trust claim is based on unjust enrichment. To establish such a claim, it must be proved that one party was enriched and that the other party suffered a corresponding deprivation for which there was no juristic reason. As Jack paid for the Echo Drive Condominium but Frances took the title, so the argument runs, Frances was unjustly enriched and Jack was correspondingly deprived without juristic reason. It is open to the appellants to defend the constructive trust claim on the basis that, among other things, there was a juristic reason, such as a gift from Jack to Frances, for title being put in Frances’s name.

ARE THE PROPOSED TRUST CLAIMS STATUTE BARRED?

[41] The appellants argue that the proposed trust claims are statute barred and therefore not tenable at law. Their argument runs as follows. s. 4 of the Act provides that “an action to recover any land” must be brought within ten years after the right to bring the action first accrued. The words “action to recover any land” in s. 4 are not limited to claims for possession of land; they encompass claims for a declaration of title in respect of land. They also encompass claims to the ownership of land advanced by way of a resulting or constructive trust. Since Jack’s estate is attempting to “recover” title to the condominium by means of resulting and constructive trust claims, the ten-year limitation period in s. 4 applies to the claim. The limitation period started to run either in 1984, when the condominium was purchased, or in 1985, when Frances died. As both events occurred more than ten years ago, the proposed trust claims are statute barred.

[42] The appellants acknowledge that, pursuant to s. 5(1) of the Act, possession can operate to postpone the commencement of the limitation period. However, they contend that Jack’s occupation of the Echo Drive condominium did not constitute possession for the purposes of s. 5(1). They say that it is plain from the wording of s. 5(1) that the mere fact that a claimant occupies or possesses the subject land in some capacity is not sufficient to postpone the limitation period in s. 4 from beginning to run in respect of a claim for a different interest in that land. They contend that for a claimant to take the benefit of s. 5(1), the claimant must be in possession of the land on the basis of the same estate or interest as that claimed in the action. In this case, as ownership is claimed, occupation of the Echo Drive condominium based on a right less than ownership would be insufficient to postpone the commencement of the limitation period. They contend that Jack occupied the Echo Drive condominium first as Frances’s spouse, during her lifetime, and then as a life tenant under her will. Accordingly, they say he was never in possession based on an ownership interest and there was no possession within the meaning of s. 5(1) to postpone the commencement of the limitation period.

[43] The respondents contest every element of the appellants’ submission. They say that the provisions of the Act do not apply to equitable remedies and through the proposed trust claims they are seeking equitable remedies. Further, they say that s. 4 does not apply because the proposed trust claims are not to “recover” land, given that Jack and/or Shirley have been in possession of the condominium since it was purchased. Moreover, in effect, they say that s. 4 does not apply to claims to land based on resulting and constructive trust principles as such actions are for a declaration of ownership and not to “recover” land.

[44] Alternatively, if the proposed trust claims are subject to the limitation period created by s. 4, the respondents say that the period has not expired. They say that Jack’s possession of the Echo Drive condominium is not limited by Jack’s belief (if he in fact held such a belief) that he was entitled to possession based only on his life interest under Frances’s will. If a court declares that Jack was the beneficial owner of the condominium from the time of purchase, then his possession of the condominium was as an owner from 1984 forward. Jack also claims that he was in possession of the condominium up to 2000 on the basis of his (1) legal title to the condominium as Frances’s executor and trustee, (2) life interest in the condominium, (3) right, as executor and trustee, to exercise the unfettered power of encroachment on capital on his own behalf, and (4) right to the benefit of the exercise of the unfettered power of encroachment. Those rights, or some combination thereof, the respondents contend, are tantamount to ownership.

[45] On this view, if the ten-year limitation period created by s. 4 does apply, ss. 5(1) and (2) operate to postpone its commencement until 2000, when Jack was wrongfully removed from his position as executor and trustee of Frances’s estate and lost the right to exercise the power of encroachment in his own favour; 2001, when Jack became aware of the facts surrounding his wrongful removal; or, 2003 when he died. Thus, the respondents argue, regardless of which of those dates triggered the commencement of the limitation period, the motion was brought well within the ten-year period and the proposed trust claims are not statute barred.

[46] In my view, ss. 42 and 43 of the Act make it unnecessary to decide the limitation period questions raised by ss. 4 and 5 of the Act because even if s. 4 applies and s. 5 does not, s. 43 operates to prevent the appellants from taking the benefit of s. 4.

[47] For ease of reference, the relevant parts of ss. 42 and 43 are set out again, below.

PART II

TRUSTS AND TRUSTEES

42 This Part applies to a trust created by an instrument or an Act of the Legislature heretobefore or hereafter executed or passed.

43(1) In this section, “trustee” includes an executor, an administrator, a trustee whose trust arises by construction or implication of law as well as an express trustee, and a joint trustee.

(2) In an action against a trustee or a person claiming through a trustee, except where the claim is founded upon a fraud or fraudulent breach of trust to which the trustee was party or privy, or is to recover trust property or the proceeds thereof, still retained by the trustee, or previously received by the trustee and converted to the trustee’s use, the following paragraphs apply:

1. All rights and privileges conferred by any statute of limitations shall be enjoyed in the like manner and to the like extent as they would have been enjoyed in such action if the trustee or person claiming through the trustee had not been a trustee or person claiming through a trustee. [emphasis added]

Applicability of ss. 42 and 43 of the Act

[48] Section 42 provides that “this Part”, which includes s. 43, applies to a trust created by an instrument or Act. “Instrument” is not defined in the Act. In Black’s dictionary, “instrument” is defined as: “A formal or legal document in writing, such as a contract, deed, will, bond, or lease.”[^2] In my view, it is beyond question that Frances’s will is an instrument and that, on her death, it created a trust of her property, with legal title to the property vested in her executor and trustee and beneficial ownership in her husband and children.[^3] Accordingly, s. 43 applies to the trust of Frances’s property.

[49] Section 43(2) provides, among other things, that:

• in an action against a trustee,

• except where the claim (in the action) is “founded upon a fraud or fraudulent breach of trust” or is “to recover trust property” retained by the trustee,

the trustee shall enjoy the rights and privileges conferred by any statute of limitations.

Action against a trustee

[50] Section 43(1) expressly provides that the word “trustee” in s. 43(2) includes an executor and joint trustees. In the main action and in the proposed trust claims, the respondents claim against the individual appellants as the successor executor and trustee of Frances’s estate, a role that the individual appellants perform jointly. On a plain reading of the claims and based on the definition of trustee in s. 43(1), it is clear that the claims are made in an action against a trustee.

[51] I recognize that the main action includes a number of different claims, only some of which are against the individual appellants in their capacity as executor and trustee of Frances’s estate. However, there is nothing in the language of s. 43 to suggest that it is to apply only if the action is limited to claims against a trustee. On the contrary, the intent of s. 43 appears obvious: trustees are to enjoy the benefit of statutory limitation periods except when the claim against the trustee falls within one or more of the exceptions of fraud, retention of the trust property or conversion. In any event, it is the proposed trust claims that are the focus of this inquiry and they are clearly limited to claims against the individual appellants in their capacity as successor executor and trustee of Frances’s estate.

[52] Thus, in my view, whether one considers the main action or the proposed trust claims that the respondents seek to add to the main action, there is “an action against a trustee” within the meaning of s. 43(2) of the Act.

Claim founded on fraud or fraudulent breach of trust

[53] The respondents, relying on the facts that underlie the claim in the main action that Jack was wrongfully removed as executor and trustee of Frances’s estate, argue that the claims are founded on fraud and therefore fall within the fraud exception in s. 43(2).

[54] To the extent there are facts that support a claim founded on fraud, those facts are alleged only in the main action. It goes without saying that the allegations in the main action are not the same as those in the proposed trust claims. As the appellants note, the proposed trust claims are not founded on any allegation of fraud or fraudulent breach of trust by Frances but, rather, on the fact that Jack paid for the Echo Drive condominium and directed that title be registered in Frances’s name. As there is no allegation of fraud by Frances and the proposed trust claims simply trace the claim against Frances to her estate trustee, they argue that the fraud exception cannot apply.

[55] I agree with the appellants and thus conclude that the proposed trust claims do not fall within the fraud exception in s. 43(2).

Claim to recover trust property retained by the trustee

[56] As previously noted, s. 43(2) provides that a trustee enjoys the rights and privileges conferred by any statute of limitations unless, among other things, the claim in the action is to recover trust property still retained by the trustee (the “second exception”). Thus, it must be determined whether the proposed trust claims are to “recover” trust property and whether the trust property is “retained” by the trustee.

[57] On a plain reading of s. 43(2), the word “recover” appears to mean “to obtain” the trust property. Such an interpretation accords with the meaning given to “recover” in s. 4 of the Act. In Williams v. Thomas, [1909] 1 Ch. 713 (C.A.) at p. 730, the English Court of Appeal held that the expression “to recover any land” in comparable legislation is not limited to obtaining possession of the land nor does it mean to regain something that the plaintiff had and lost. Rather, “recover” means to “obtain any land by judgment of the Court”. See also OAS Management Group Inc. v. Chirico (1990), 1990 6909 (ON SC), 9 O.R. (3d) 171 (Dist. Ct.) at 175 to the same effect.

[58] In para. 1(l) of the amended fresh statement of claim, the respondents seek a declaration that Jack’s estate is entitled to ownership of the Echo Drive condominium and in para. 1(m) they seek an order “transferring the lands and residential condominium premises located at … Echo Drive … from the estate of the late Frances Hartman to the estate of the late Jacob Harman and Shirley Strean, as the Estate Trustee of the Estate of the late Jacob Hartman”. It is apparent that the respondents wish to obtain title to the Echo Drive condominium from the trustee. In my view, the respondents seek to “recover” the trust property from the estate trustee.

[59] The amendments necessary to support the proposed trust claims are in paragraphs 39 to 50 of the amended fresh statement of claim. Those paragraphs make it clear that the claim is to recover the trust property from the individual appellants who hold title to the Echo Drive property in their capacity as the successor executor and trustee of Frances’s estate. It does not matter that the persons occupying the position of trustee have changed since Frances’s death. The estate trustee has held title to the Echo Drive condominium since Frances’s death and continues to so hold title. That is, the trust property is “still retained by the trustee”.

[60] Thus, in my view, a plain reading of s. 43(2) leads to the conclusion that the proposed trust claims fall squarely within the language of the second exception with the result that the individual appellants cannot rely on s. 4 to bar the proposed trust claims.

[61] However, the appellants argue that Taylor v. Davies (1919), 1919 521 (UK JCPC), 51 D.L.R. 75 (P.C.) is binding authority that requires this court to conclude that a claim to property based on a resulting or constructive trust is not a claim “to recover trust property” within the meaning of the second exception in s. 43(2). While they acknowledge that Taylor v. Davies involved a constructive trust, they argue that the reasoning applies equally to resulting trust claims as in neither case is there an alleged trust that arose before the transaction impeached.

[62] In Taylor v. Davies, an inspector for a bankrupt estate personally took title to real property of the estate. A claim was advanced against the inspector on the basis that because he was a fiduciary, he was disqualified from purchasing the property and therefore he held the property as a constructive trustee. The Privy Council held that the ten-year limitation period prescribed by what was then s. 5 of the Ontario Limitations Act (which is the same as s. 4 of the Act in the within appeal) barred the claim as the action was commenced more than ten years after the inspector received the property.

[63] After noting that the definition of trustee included a trustee whose trust arose by construction or implication of law, as well as an express trustee, the Privy Council stated, at p. 86:

The expressions “trust property” and “retained by the trustee” properly apply, not to a case where a person having taken possession of property on his own behalf, is liable to be declared a trustee by the Court; but rather to a case where he originally took possession upon trust for or on behalf of others. In other words, they refer to cases where a trust arose before the occurrence of the transaction impeached and not to cases where it arises only by reason of that transaction. The exception no doubt applies, not only to an express trustee named in the instrument of trust, but also to those persons who under the rules explained in Soar v. Ashwell, supra, and other cases are to be treated as being in a like position; but in their Lordships’ opinion it does not apply to a mere constructive trustee of the character described in the judgment of Sir William Grant.

[64] In my view, Taylor v. Davies is distinguishable from the instant case and ought not to be followed.

[65] In Taylor v. Davies, the inspector took title to the property on his own behalf. In the case at bar, if it is established that Jack provided all of the consideration for the Echo Drive condominium at the time of its purchase, Frances did not take title to the property on her own behalf. She did so on Jack’s behalf – that is, as trustee for Jack. It may be established that Jack made a gift of the property to Frances but until that is proved, if Jack provided all of the consideration, in the eyes of the law, Frances took title on his behalf.

[66] This point also illustrates why the reasoning in Taylor v. Davies cannot be assumed to necessarily apply to resulting trusts. In the case of a resulting trust of the sort alleged in the proposed trust claims, two transactions took place. The first was the sale of the property. When consideration flowed from Jack to the vendor of the property, in the eyes of equity, title passed from the vendor to Jack, as purchaser. Because Jack became the owner of the property, he had the right to direct that title be placed in Frances’s name. It is trite law that only an owner of property (or someone acting on his or her behalf) has the legal right to deal with title to the property. Title being placed in Frances’s name was the second transaction. The trust was operative when Jack became the owner of the property which occurred before the “transaction impeached”, that is, the transaction which resulted in title being placed in Frances’s name, pursuant to Jack’s direction. Accordingly, neither the reasoning nor the result in Taylor v. Davies requires this court to conclude that the resulting trust part of the proposed trust claims falls outside the second exception in s. 43(2).

[67] Moreover, in my view, Taylor v. Davies does not dictate such a result in respect of the constructive trust part of the proposed trust claims. The conclusion that the second exception did not apply to the inspector in Taylor v. Davies is based on the Privy Council’s determination that the exception does not apply to a “mere constructive trustee of the character described in the judgment of Sir William Grant”. At p. 85 of Taylor v. Davies, the Privy Council sets out that part of the judgment of Sir William Grant M.R. to which it was referring.

But the position in this respect of a constructive trustee in the usual sense of the words – that is to say, of a person who, though he had taken possession in his own right, was liable to be declared a trustee in a Court of Equity – was widely different, and it had long been settled that time ran in his favour from the moment of his so taking possession. This rule is illustrated by the well-known judgment of Sir William Grant, M.R., in Beckford v. Wade (1805), 17 Ves., 87, at 97, where he says:

It is certainly true, that no time bars a direct trust, as between cestui que trust and trustee; but, if it is meant to be asserted, that a Court of Equity allows a man to make out a case of constructive trust at any distance of time after the facts and circumstances happened, out of which it arises, I am not aware that there is any ground for a doctrine so fatal to the security of property as that would be; so far from it, that not only in circumstances where the length of time would render it extremely difficult to ascertain the true state of the fact, but where the true state of the fact is easily ascertained, and where it is perfectly clear that relief would originally have been given upon the ground of constructive trust, it is refused to the party who after long acquiescence comes into a Court of Equity to seek that relief.

So in Soar v. Ashwell, [1893] 2 Q.B. 390, at 393, Lord Esher, M.R., stated the rule as follows:

If the breach of the legal relation relied on, whether such breach be by way of tort or contract, makes, in the view of a Court of Equity, the defendant a trustee for the plaintiff, the Court of Equity treats the defendant as a trustee becomes so by construction, and the trust is called a constructive trust; and against the breach which by construction creates the trust the Court of Equity allows Statutes of Limitations to be vouched.

[68] The type of constructive trust under consideration in Taylor v. Davies is very different from that alleged in the proposed trust claims. As previously explained, the constructive trust claim in the instant case is that of a remedial constructive trust. It is founded on the principles enunciated by the Supreme Court of Canada in Pettkus v. Becker, 1980 22 (SCC), [1980] 2 S.C.R. 834. It may be that the Act does not prescribe any limitation period for the remedial constructive trust. At p. 16 of Hollett v. Hollett, [1993] N.J. 103, the Newfoundland Supreme Court considered comparable legislation and concluded that:

As a remedy for unjust enrichment, founded on a cause of action formulated in the manner of Pettkus v. Becker, supra, which cannot be said to be wholly legal or equitable, the constructive trust cannot be said to fit within the established categories of the Limitation of Personal Actions Act legislation. Accordingly, it is not governed by any such limitation periods.

[69] The remedial constructive trust did not exist at the time that Taylor v. Davies was decided. This type of constructive trust has its origins in Canadian jurisprudence and, as previously stated, requires a finding that there has been an enrichment of one party and a corresponding deprivation in another, for which there is no juristic reason. This type of constructive trust is as much a remedy as it is a cause of action hence its description as a “remedial constructive trust”. It is not like the type of constructive trust under consideration in Taylor v. Davies. Thus, in my view, Taylor v. Davies is not determinative of the constructive trust part of the proposed trust claims either.

[70] As Taylor v. Davies is not binding and I do not find its reasoning persuasive, I decline to follow it. Accordingly, I would give s. 43(2) its plain meaning and hold that the proposed trust claims falls within the second exception in s. 43(2).

[71] In reaching this conclusion, I have not ignored the other cases referred to by the parties. As the appellants found their arguments largely on Taylor v. Davies, it is sufficient to note the following. In Clarkson v. Davies, [1922] A.C. 100 (P.C.), which originated in Ontario, the Privy Council applied the reasoning of Taylor v. Davies and found that the constructive trust arose by reason of the impeached transaction. I do not find this case helpful since, like Taylor v. Davies, Clarkson predates the creation of the remedial constructive trust in Canadian law.

[72] Egnatios v. Leon Estate (1990), 1990 8067 (ON SC), 73 D.L.R. (4th) 137 (Ont. Gen. Div.) was a decision on a motion for summary judgment brought by the defendants who argued that the plaintiff’s constructive trust claim was statute barred. Sutherland J. did not decide whether the plaintiff’s claim against her brothers based on constructive trust was statute barred under s. 43(2). After noting that Taylor v. Davies has been strongly criticized by leading academics in the trusts field, he held that because it was possible that the plaintiff’s brothers might have had pre-existing fiduciary obligations towards her, Taylor v. Davies might not apply and the brothers might be treated as express trustees for the purposes of s. 43(2). Consequently, to the extent that Egnatios is of assistance to the resolution of the issues in the within appeal, it supports the notion that Taylor v. Davies does not apply to all constructive trust claims.

[73] The remaining cases cited by the appellants are not Ontario cases and therefore are not binding on this court. In J.L.O. Ranch Ltd. v. Logan Estate (1987), 1987 3174 (AB KB), 27 E.T.R. 1 (Alta Q.B.), the plaintiff brought an action against the executrix of a deceased director of a company claiming the recovery of certain land that had been transferred from the company to the director. Justice Trussler found that trust obligations arose as a result of the director’s fiduciary duties to the company, but that the claim was statute barred because there was no trust that pre-existed the transfer. That case is distinguishable from the present appeal because it did not involve a remedial constructive trust claim.

[74] In Findlay v. Findlay (1985), 1985 829 (BC SC), 47 R.F.L. (2d) 356 (B.C.S.C.), aff’d (1986), 1986 1360 (BC CA), 8 R.F.L. (3d) 12 (B.C.C.A.), Lander J. held that the wife’s claim for a declaration that her husband held the matrimonial home on a resulting trust was barred by the limitation period which he held would have started to run on dissolution of the marriage. He stated that, “the result is distressing” but considered himself bound by the decision in Taylor v. Davies. However, the limitation period in Findlay arose from s. 3(2) of the Limitation Act, R.S.B.C. 1979, c. 236, and its wording is materially different from the wording of s. 43. It reads as follows:

2. After the expiration of 10 years after the date on which the right to do so arose a person shall not bring an action

(a) against the personal representatives of a deceased person for a share of the estate;

(b) against a trustee in respect of any fraud or fraudulent breach of trust to which the trustee was party or privy;

(c) against a trustee for the conversion of trust property to the trustee's own use;

(d) to recover trust property or property into which trust property can be traced against a trustee or any other person;

(e) to recover money on account of a wrongful distribution of trust property against the person to whom the property is distributed, or a successor;

(f) on a judgment for the payment of money or the return of personal property."

[75] Finally, in Hollett v. Hollett, Green J. relied on the decision of Goodridge J. in Cook v. Cook, [1977] N.J. 161 (S.C. (T.D.)) and held that a claim to a declaration of resulting trust was governed by the twenty year limitation period in the Limitation of Realty Actions Act, R.S.N. 1990, c. L-16, s. 3. However, as noted above, it was held also in Hollett v. Hollett that the remedial constructive trust is not governed by any statutory limitation period where the trust property is still retained by the trustee.

[76] Moreover, as the respondents point out, there is authority that casts doubt on the applicability of Taylor v. Davies. In Bell v. Guaranty Trust (1984), 1984 2422 (SK CA), 13 D.L.R. (4th) 477, the Saskatchewan Court of Appeal held that the principle in Taylor v. Davies should be restricted to a “constructive trustee of the character described in the judgment of Sir William Grant.” The court concluded that the trust in question was not the type of constructive trust discussed in Taylor v. Davies and, thus, the limitation period did not operate to extinguish beneficial ownership.

[77] Taylor v. Davies was questioned again by the Saskatchewan Court of Appeal in Skippon v. Scharnatta, [1986] S.J. No. 106. The parties in that case had been married for many years until the husband died in 1977. Through his will, the husband gave his wife a life interest in a small farm and provided a remainder interest to their four children. The wife claimed that he was not entitled to do that because she was the beneficial owner of half the farm. The wife argued that her resulting and constructive trust claims were not statute barred because her husband, through his executors, still retained the property. Cameron J.A. stated that the construction given to the words of s. 43(2) in Taylor v. Davies was at odds with the words in the provision and declined to follow it. At p. 18, he noted a number of first instance cases that had “ignored” the decision in Taylor v. Davies and stated that the courts were not prepared to apply Taylor v. Davies to all types of constructive trusts. He chose to give the words of s. 43(2) their “ordinary meaning”. At p. 17, he wrote:

[T]hese are the words: trustee includes “a trustee whose trust arises by construction or implication of law as well as an express trustee.” In my respectful opinion this means that the section applies to an action against a trustee holding property on (i) an express trust, (ii) an implied trust (including a “resulting” trust), and (iii) a constructive trust. And, with the greatest of respect for those who have not, or do not now, share this view, that is the construction I would give the section. The rule of Taylor v. Davies has long since ceased to be the law of England, and for my part I should not like to prolong its run in this jurisdiction particularly in light of the definition of “trustee” contained in s. 43(1) of the Saskatchewan statute.

[78] He added that even if Taylor were to be regarded as good law, the claim for a resulting trust was not statute barred since it did not fit within the category of a “mere constructive trustee of the character described in the judgment of Sir William Grant”.

[79] Justice Wakeling concurred in the result saying that in his view, Taylor v. Davies acknowledges that the exceptions in s. 43 apply to express trusts and resulting trusts and that Taylor v. Davies does not apply to remedial constructive trusts of the sort defined in Pettkus v. Becker.

[80] Justice Brownridge dissented, holding that the principle in Taylor v. Davies applied. He found that the deceased fell within the category of a person who has taken possession of property on his own behalf and who is later liable to be declared a trustee by the court. Consequently, he was of the view that the limitation period was a defence to the action.

[81] The two other cases on which the respondents rely speak to the question of whether any limitation period applies to the proposed trust claims, rather than to the applicability of s. 43(2). In Menary v. Welsh (1974), 1973 437 (ON CA), 1 O.R. (2d) 393, this court held that an action for rectification of a deed is not an action to recover land and, thus, the statutory limitation period did not apply to bar the claim. The respondents argue that Menary v. Welsh should be read as standing for the proposition that where a claimant’s success in establishing title is not dependent upon the establishment of title by adverse possession, the statutory limitation period does not apply to bar the claim.

[82] In McDonald v. McDonald (1893), 1892 7 (SCC), 21 S.C.R. 201, a claim to land based on constructive trust was brought more than twenty years after the trust arose. The claim was dismissed at first instance but allowed on appeal to the Ontario Court of Appeal. A further appeal to the Supreme Court of Canada was dismissed. Justice Strong, in dissent, was of the view that whether or not the claim was in the nature of an action to recover land and therefore governed by the statutory limitation period, the lapse of time was a bar.

[83] The appellants make two valid points in respect of McDonald v. McDonald. First, it was decided before Taylor v. Davies. Second, Taylor v. Davies held not only that certain types of constructive trust claims are outside the second exception but also that the statutory limitation period applies to such claims.

[84] Although both parties referred to M.(K.) v. M.(H.), 1992 31 (SCC), [1992] 3 S.C.R. 6, I fail to see its relevance to the matters in issue. M.(K.) v. M.(H.) dealt with the question of limitation periods in relation to fiduciary obligations; counsel for both parties in M.(K.) v. M.(H.) conceded that the limitations legislation did not apply to fiduciary obligations. At para. 87 of that decision, La Forest J. noted that Part II of the Act does not encompass fiduciary obligations. He cites Taylor v. Davies at the end of that paragraph only as support for the statement that cases considering the scope of the term “trustee” in s. 43 have limited its application to express or constructive trustees. There is no consideration of the issues raised on this appeal.

[85] It is apparent that there is no clear, general answer to the question of whether claims to land based on resulting or constructive trust are subject to a statutory limitation period and, if so, whether the exceptions in s. 43(2) apply to all trustees who hold property by way of resulting or constructive trust. In the case at bar, however, if the statutory limitation period does apply to such claims, for the reasons already given, I am not bound to apply Taylor v. Davies. I would give a plain reading to s. 43(2) with the result that the proposed trust claims fall within the second exception.

[86] The respondents argue, apparently for the first time on appeal, that if there is a statutory limitation period in respect of the proposed trust claims, its operation is postponed by virtue of the discoverability principle. In light of the conclusion reached on the second exception in s. 43(2), it is unnecessary to determine when the causes of action in the proposed trust claims arose and whether a statutory limitation period applies to the proposed trust claims. Thus, it is unnecessary to decide the discoverability issue and I decline to do so.

[87] Accordingly, even if s. 4 of the Act applies to the proposed trust claims and s. 5 does not operate to postpone the commencement of the limitation period, time does not run in respect of the proposed trust claims because of s. 43(2). The appellants cannot claim the benefit of the statutory limitation period and the proposed trust claims are not statute barred.

WILL THE PROPOSED AMENDMENTS GIVE RISE TO NON-COMPENSABLE PREJUDICE?

[88] The appellants argue that if the proposed claims are permitted to go forward, they will suffer non-compensable prejudice because they will be unable to examine either Jack or Frances on the matter of their intentions in respect of ownership of the Echo Drive condominium at the time it was purchased. In making this argument, they rely on Walker v. York French General Hospital (1995), 1995 7193 (ON SC), 23 O.R. (3d) 248 (Gen. Div.) and obiter by this court in Kings Gate Development v. Colangelo (1994), 1994 416 (ON CA), 17 O.R. (3d) 841 at 844, to the effect that death of a material witness constitutes non-compensable prejudice.

[89] Walker involved two actions in which the plaintiffs sought recovery for damages suffered as a result of receiving transfusions of HIV‑infected blood. After the plaintiffs died, a motion was brought to amend the statements of claim to plead a duty by the defendants to warn them of the risks of HIV transmission through blood transfusions and a breach of that duty. The defendants opposed the motion on the basis, inter alia, that the death of the plaintiffs gave rise to prejudice that could not be compensated by costs or an adjournment.

[90] The motion to amend was granted, despite the plaintiffs’ deaths. Justice Feldman, as she then was, recognized that in obiter in Kings Gate, this court referred to the death of a material witness as an example of non-compensable prejudice. Nonetheless, she was not satisfied that the defendants would suffer such prejudice. At p. 252 of the decision, she gives two reasons for this conclusion. First, the deaths were of plaintiffs, rather than of witnesses. Second, she was of the view that whatever prejudice the defendants might suffer in terms of their ability to obtain evidence was more than matched by the constraints that the deaths would have on the plaintiffs’ ability to prove their claims.

[91] In my view, similar reasoning applies in the instant case. Jack was a plaintiff in the original proceeding. As Feldman J. notes at p. 253 of Walker, death of a plaintiff affects both sides to an action, but it does not prevent the action from proceeding.[^4] And, as the motion judge stated at para. 24 of the reasons, it is possible that the deaths of Jack and Frances will prejudice the respondents more than the appellants. I note, as well, that from the commencement of the main action, Jack and Shirley have claimed ownership of the Echo Drive condominium (see paras. 1(l), 43, 44, 50 and 81 of the fresh statement of claim), the proposed trust claims are closely related to the same factual matters at issue since the commencement of the main action, and the individual appellants, or at least Mark Hartman, were aware of the material facts that underlie the proposed trust claims prior to the commencement of the main action.

[92] Consequently, I see no basis on which to interfere with the motion judge’s determination that the appellants failed to discharge the burden of demonstrating that they would suffer non-compensable prejudice if the amendments were permitted. As she stated, in respect of the resulting trust claim, intention can be inferred from Jack and Frances’s actions and the documentary evidence, and, in respect of the constructive trust claim, to the extent that intention is relevant, it can be discerned from the documentary and third party evidence surrounding the purchase of the condominium.

SHOULD THE LIMITATION PERIOD ISSUE BE LEFT FOR TRIAL?

[93] In light of my conclusion that the proposed trust claims are not statute barred, it follows that there is no limitation period issue left for trial.

DISPOSITION

[94] In written submissions following the hearing of this appeal, both sides were of the view that, although two estates are involved in this matter, the normal costs rules which apply to civil litigation and appeals are applicable. I agree.

[95] Accordingly, I would dismiss the appeal with costs to the respondents fixed at $10,000.00, inclusive of disbursements and GST.

RELEASED: January 12, 2006 (“KMW”)

“E. E.Gillese J.A.”

“I agree K. M. Weiler J.A.”

“I agree M. Rosenberg J.A.”

[^1]: The law governing limitation periods in Ontario was substantially reformed with the entry into force of the Limitations Act, 2002, S.O. 2002, c. 24. However, by virtue of s. 2(1)(a) of that Act, its provisions do not apply to proceedings to which the Real Property Limitations Act applies.

[^2]: Black’s Law Dictionary, Sixth Edition (St. Paul: West Publishing Co., 1991) at 801.

[^3]: Jack was given a life interest in Frances’s estate and the individual appellants were given the remainder interest, which interest was defeasible on the exercise of the power of encroachment in favour of Jack.

[^4]: The within proceeding was continued by order dated August 8, 2003.