Court File and Parties

COURT OF APPEAL FOR ONTARIO DATE: 20220927 DOCKET: M53584, M53617 & M53638 (C70563)

Gillese, Huscroft and Sossin JJ.A.

BETWEEN

Ottavio Di Santo Applicant (Respondent) Responding Party in M53584/ Moving Party in M53617 & M53638)

and

CIBC Trust Corporation, in its capacity as Estate Trustee During Litigation of the Estate of Vincent Di Santo, deceased, and in its capacity as Trustee During Litigation of the Vincent Di Santo 2003 Family Trust, John Di Santo, Carmela Di Santo, Stacy Mitchell, Tony Di Poce, David Sugarman, OJCR Construction Ltd., Anthony Vincent Padula, Andrew Padula, Mia Antoinette Padula, Bianca Di Santo, and Madison Di Santo Respondents (Appellants) Moving Parties in M53584/ Responding Parties in M53617 & M53638)

Counsel: Ian M. Hull, Doreen Lok Yin So and John Lo Faso, for the moving parties (M53584) / responding parties (M53617 & M53638) John Di Santo, Carmela Di Santo, Stacy Mitchell, Tony Di Poce, and OJCR Construction Ltd. Matthew Rendely and Nima Hojjati, for the responding party (M53584) / moving party (M53617 & M53638) Ottavio Di Santo Kelly A. Charlebois, for CIBC Trust Corporation, in its capacity as Estate Trustee During Litigation of the Estate of Vincent Di Santo, deceased, and in its capacity as Trustee During Litigation of the Vincent Di Santo 2003 Family Trust

Heard: September 15, 2022

Reasons for Decision

[1] By order of the application judge in this proceeding, dated March 16, 2022 (the “Order”), John Di Santo, Carmela Di Santo, Stacy Mitchell, and Tony Di Poce were removed as estate trustees for the Estate of Vincent Di Santo (the “Estate”) and John Di Santo, Mr. Mitchell, and Mr. Di Poce were removed as trustees of the Vincent Di Santo 2003 Family Trust (the “Family Trust”). CIBC Trust Corporation (“CIBC Trust”) was ordered to be the estate trustee during litigation (“ETDL”) and the replacement trustee of the Family Trust. The Order also required that certain interim funding payments be made to the respondent, Ottavio Di Santo (the “Respondent”), with such payments to be made from OJCR Construction Ltd. (“OJCR”). The application judge awarded the Respondent costs of the application of $80,000 (the “Costs Order”).

[2] John Di Santo, Carmela Di Santo, Mr. Mitchell, Mr. Di Poce, and OJCR (the “Appellants”) brought an appeal to this court against the provisions of the Order relating to the removal and replacement of the trustees. That appeal is scheduled to be heard on December 7, 2022. In the interim, the parties have brought the three motions now before the court (the “Motions”).

[3] In the first motion, the Appellants seek a stay of the provisions in the Order that remove the named trustees and replace them with CIBC Trust, pending the disposition of the appeal (M53584). In the second motion, the Respondent seeks an order lifting the stay of the Costs Order (M53617). In the third motion, the Respondent seeks an order quashing or staying the appeal (M53638).

[4] CIBC Trust appeared on the Motions. It took no position on whether the court should order a stay of its appointment. However, it addressed the terms of any potential order the court might make. It also sought indemnification for its outstanding professional fees incurred to date.

[5] After the oral hearing of the Motions, the court advised the parties that the Appellants’ stay motion was granted and the Respondent’s motions were dismissed, with reasons to follow. These are the promised reasons.

Analysis

The Stay Motion

[6] In RJR-MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311 at p. 334, the Supreme Court held that, on a motion for a stay, the court must determine whether: (1) there is a serious issue to be determined on the appeal; (2) the moving party will suffer irreparable harm if the stay is not granted; and (3) the balance of convenience favours a stay.

[7] In our view, all three factors militate in favour of ordering the requested stay.

[8] The primary issue to be decided on the appeal is whether the application judge erred in ordering the removal of the deceased’s named trustees and replacing them with CIBC Trust. Removing trustees whom a deceased has specifically chosen is a serious matter. The concerns surrounding such an intrusion on a deceased’s intention are magnified in a situation such as this where the Estate, the Family Trust, and their underlying businesses (together, the “Entities”) have a complex interrelationship and, together, have assets worth over $70 million. In our view, it is beyond dispute that this appeal raises a serious issue for determination.

[9] If the stay is not granted and the removal and replacement orders are overturned on appeal, the Entities will suffer enormous business disruptions and financial upheaval. The ensuing harm cannot be quantified in monetary terms nor cured by damages. The stay is necessary to avoid the potential irreparable harm to the administration, and financial health, of the Entities.

[10] The appeal is scheduled to be heard on December 7, 2022, just a few weeks away. The Appellants have made all interim support payments as required under the Order and advised they will continue to make such payments. They are also moving promptly to comply with other aspects of the Order, including disclosure and the passing of accounts. Thus, there is no prejudice to the Respondent if the stay is ordered. The balance of convenience clearly favours granting the stay.

[11] In our view, it is in the interests of justice that the provisions in the Order relating to the removal and replacement of the trustees be stayed, pending disposition of the appeal.

The Motion to Lift the Stay of the Costs Order

[12] The Costs Order was automatically stayed by the filing of the appeal: Rules of Civil Procedure, R.R.O. 1990, Reg. 194, r. 63.01(1). We see no basis for lifting that stay.

The Motion to Quash or Stay the Appeal

[13] The Respondent’s motion to quash or stay the appeal is based on two grounds. First, he submits the appeal must be quashed for lack of jurisdiction because the appeal route for the interlocutory parts of the Order is to the Divisional Court (and, in some instances, leave of that court is required). Second, the Respondent says that the Appellants “flagrant[ly]” disregarded the Order and their “wilful breach[es]” disentitle them to proceed with their appeal.

[14] In their appeal to this court, the Appellants are not challenging those aspects of the Order that are interlocutory in nature. As explained above, the Appellants are challenging those parts of the Order relating to the removal and replacement of the trustees. Those orders are final in nature and, therefore, this court has jurisdiction to hear them. The Appellants have launched a separate appeal in the Divisional Court in relation to those parts of the Order for which the appeal route lies to the Divisional Court. Accordingly, we see nothing in the Respondent’s argument based on jurisdiction.

[15] The Appellants have made all payments for money and support required by the Order. Further, they have acted reasonably and promptly in respect of disclosure and passing of accounts. In our view, there is nothing in the Appellants’ conduct that disentitles them from proceeding with their appeal.

[16] Accordingly, the Respondent’s motion to quash or stay the appeal is dismissed.

Disposition

[17] For these reasons, this court orders that:

a. the stay motion (M53584) is granted and paragraphs 1-35, that part of para. 36 requiring that payments to the Respondent are to be made from OJCR, and paras. 37 and 38 of the Order are stayed;

b. motions M53617 and M53638 are dismissed;

c. costs of the Motions are ordered payable, from the Estate, in the following all-inclusive amounts: $72,700 to the Appellants and $69,000 to the Respondent; and

d. CIBC’s costs incurred in this proceeding to date, including on the Motions, are ordered payable from the Estate in the agreed-on sum of $33,000 plus HST.

“E.E. Gillese J.A.”

“Grant Huscroft J.A.”

“L. Sossin J.A.”