Court File and Parties
CITATION: Gefen v. Gefen, 2021 ONSC 1464
DIVISIONAL COURT FILE NO.: 472/20 DATE: 20210301
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
Sachs, Lederer and Mew JJ.
BETWEEN:
HENIA GEFEN in her personal capacity and as estate trustee of the Estate of ELIAS GEFEN
Ronald Moldaver Q C, for the Appellants in Appeal, Henia Gefen in her personal capacity and as estate trustee of the estate of Elias Gefen, Harvey Gefen and Ashley Gefen
Plaintiff/Appellant
– and –
ARIE GAERTNER, MILLER, CANFIELD, PADDOCK and STONE, LLP, THE JEWISH HOME FOR THE AGED, BAYCREST HOSPITAL, BAYCREST CENTRE FOR GERIATRIC CARE, YEHUDA GEFEN and HARRY GEFEN
Harry Gefen, acting in person
Lisa Filgiano, lawyer for the Estate Trustee during Litigation
Christopher M.B. Graham, for the Estate of Yehuda Gefen
Defendants/Respondents
AND BETWEEN:
HARRY GEFEN
Plaintiff by Counterclaim
– and –
HENIA GEFEN in her personal capacity and as estate trustee of the Estate of ELIAS GEFEN, HARVEY GEFEN, ASHLEY GEFEN, DUNDAS-THICKSON PROPERTIES LTD., 1393522 ONTARIO LIMITED and 1585708 ONTARIO LIMITED
Defendants by Counterclaim (Appellants in Appeal)
AND BETWEEN:
HARRY GEFEN
Third Party Plaintiff
-and-
HARVEY GEFEN
Third Party Defendant
HEARD at Toronto (by video conference): February 24, 2021
Oral Reasons for Judgment
Lederer J. (Orally)
[1] Henia and Elias Gefen were husband and wife. They were married for 65 years. They executed mutual wills. That is to say they left their entire estates to each other and upon the death of the second of them in equal parts to their three sons, Harry, Harvey and Yehuda. Elias died. His estate has passed to Henia. Yehuda has also died. His interest in these matters is being carried out by his estate. Harry and Yehuda, understanding their mother to favour Harvey, came to believe that she would pass assets to him while she was alive, limiting what would remain to be distributed following her death. Harry and Yehuda believed this to be contrary to a “mutual will agreement” their parents had entered into shortly before the death of their father. The impact of the agreement, if it exists, was that the survivor of the death of the first of them would not breach the mutuality of the wills by dissipating or transferring the assets to one or other of their children. In response to an action commenced by Henia, Harry and Yehuda commenced a counterclaim directed to establishing the existence and validity of the mutual will agreement.
[2] In furtherance of the processing of the action and in order to protect the estate while it was underway, Ronald Rutman was appointed as an Estate Trustee During Litigation. The appointment was made by order of this court, including the following terms:
THIS COURT ORDERS that Ronald Rutman C.A. (“Mr. Rutman”) be appointed as the estate trustee during litigation (“EDTL”) over the Estate of Elias Gefen (the “Estate”), pending the final disposition of the counterclaim of Harry Gefen alleging that Henia and Elias Gefen (“Elias”) entered a mutual will agreement between approximately August 17 and September 1, 2011 in Gefen v. Gaertner (collectively the “Will Challenge Claim”), with the said order to include the following terms:
(a) That Ronald Rutman C.A. be appointed as EDTL with respect to all of the property of the Estate pending the final disposition of the Will Challenge Claim, and that a Certificate of Appointment of Estate Trustee During Litigation shall be issued to Ronald Rutman, subject to the filing of the necessary supporting application;
[Emphasis added]
[3] Between November 2018 and March 2019 the trial of these issues proceeded before Justice Kimmel. On October 17, 2019, she released her reasons. Among other things, she dismissed the “Will Challenge Claim”, which is to say she found that there was no “mutual will agreement”. This would leave Henia free to deal with the assets as she wished. Harry Gefen has appealed that finding. An issue arose as to the status of the Estate Trustee During Litigation. Following the decision of the court, did it cease or was it to continue as the appeal proceeded? Through his counsel, Ronald Rutman wrote to the parties confirming his understanding that his role was to continue until the litigation was finally completed. In the face of this correspondence, Harvey attempted to list three commercial properties that had been a substantial part of his father’s estate, for sale. He did this without notifying Ronald Rutman.
[4] Henia and Harvey continued and continue to maintain that the role of the Estate Trustee During Litigation was spent as of the release of the reasons of Justice Kimmel. On September 3, 2020, the parties attended a case conference. The case management judge ordered, among other things, that the issue of the jurisdiction of the Estate Trustee During Litigation be determined by a judge of the Estates List. The motion was heard and the judge determined that the case law and legal authority made it clear that that the Estate Trustee During Litigation was to continue until the litigation was finally completed. The Order making the appointment was clear on its face. The Court intended the Estate Trustee During Litigation to be appointed pending the final disposition of the Will Challenge Claim and that it had not finally been determined given that it was under appeal.
[5] This is an appeal of that order. The issue is the meaning of the phrase “pending the final disposition of the Will Challenge Claim” as it appears in the order appointing the Estate Trustee During Litigation. There is no basis upon which the decision of the motion judge can be challenged. Her understanding of the use of the word “pending” is correct. There is no palpable and overriding error that can be established in respect of the facts on which she relied.
[6] “Pending” means “while waiting” or “continuing”. One dictionary meaning refers to it as meaning “not yet decided” (Merriam- Webster’s Collegiate Dictionary Tenth Edition). What are the parties waiting for? As noted in the order appointing the Estate Trustee During Litigation, they are waiting for the “final disposition of…” As the judge hearing the motion observed, the principle that “the duties of an Estate Trustee During Litigation continue until the litigation is finally completed, including during any appeal” (Brian A, Schurrr, Estate Litigation 2nd ed (Toronto: Thomson Reuters Canada, 1994, loose-leaf, ch 24 at s. 24.3 (e)) has long been established in the caselaw:
It is clear that the duties of an administrator pendente lite continue until the litigation in respect of which he is appointed is finally disposed of. Even, as in this case where judgment is appealed his duties continue until the final appeal or disposition of the litigation.
(Lloyd v. Lloyd 1980 CarswellOnt 529 (Ont. Surr. Ct.) at para. 23 (A will was challenged. There was an appeal. The trustee was asked to pay support to the wife of the deceased (the appellant) who was impecunious. He could pay. His authority continued through the appeal.).
And see: Taylor v. Taylor (1881) 6 P.D. 29 (There was a trial and an appeal. There was a trustee. He continued to act during the appeal. The appeal acted as a continuation of the dispute. The authority of the trustee continued.)
And see: McLennan v. McLennan Re, 2002 CarswellOnt 4153 (S.C.J.) at para. 17 (Where the judge made clear that “the duties of an Estate Trustee During Litigation come to an end when the litigation ceases).
[7] As counsel for the responding parties notes there is not a single case that would support the position taken by the Appellant on what are the clear and accepted meaning of the words found in the order appointing the Estate Trustee During Litigation.
[8] Despite the submissions of counsel for the Appellant, there is no reason to deviate from this long and continuous understanding, particularly given the clear words of the order appointing the Estate Trustee During Litigation. During the course of argument, counsel for the applicant asked “does ‘litigation’ include an appeal to an appellate court?” The answer, on any common-sense application of the natural and ordinary meaning of that term is surely “yes”. Rule 74.10 provides for the appointment of an estate trustee during litigation. Litigation does not end until all appeals are exhausted.
[9] Finally, there is no merit to the Appellant’s position that the motion judge’s order conflicts with judgment of Justice Kimmel. Paragraph 8 of that Judgment includes:
The scope and duration of the EDTL’s appointment, his jurisdiction and role are the subject of separate orders which are unaffected by this judgment.
[10] The judge hearing the motion awarded costs to the Estate Trustee During Litigation on a full indemnity basis. She ordered that of the total costs of $13,990.50, Henia Gefen, Harvey Gefen and Ashley Gefen are to pay $6,600 (awarded on a partial indemnity scale), the balance to be paid by the Estate of Elias Gefen. Like the understanding of “final disposition”, there is a well understood and established principle that recognizes that Estate Trustees During Litigation are entitled to be indemnified for their legal costs incurred in the discharge of their duties:
The courts have long held that trustees are entitled to be indemnified for all costs including legal costs, which they have a reasonably incurred. Reasonable expenses include the costs of an action reasonably defended: see Re Dingman (1915) 35 O.L.R.51. in Re Dallaway, [1982] 1 W.L.R. 756, [1982] 3 All E.R. 118, Sir Robert Megarry V.C. stated the state rule thus at p. 21
Insofar as such person [trustee] does not recover his costs from any other person, he is entitled to take his costs out of the fund held by him unless the court otherwise orders; and the court can otherwise order only on the ground that he has acted unreasonably, or in substance for his own benefit, rather than for the benefit of the fund.
(Goodman Estate v. Geffen, [1991] 2 S.C.R. 353 see also Sawdon Estate v. Watch Tower Bible and Tract Society of Canada 2014 ONCA 101 at para. 82)
[11] Similarly, it is well established, in fact trite, that in civil litigation, including estate cases, the successful party is presumptively entitled to costs from the unsuccessful party or parties. Leave to appeal the cost order of the judge who heard the motion is also being sought. Costs orders are recognized as being discretionary. They are only subject to appeal in the presence of an error of principle or if they are clearly wrong. Neither condition being present, the award as made stands. Leave is refused.
[12] The appeal is dismissed.
[13] Costs are to be paid by the Appellant to the responding parties in the following amounts by the appellants:
a. Ashley, Henia and Harvey personally in the amount of $10,743.59 and by the estate $7,173.69 for a total of $17,917.28 which equals the full indemnity costs
___________________________ Lederer J.
I agree
Sachs J.
I agree
Mew J.
Date of Oral Reasons for Judgment: February 24, 2021
Date of Release: March 1, 2021
CITATION: Gefen v. Gefen, 2021 ONSC 1464
DIVISIONAL COURT FILE NO.: 472/20 DATE: 20210301
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
Sachs, Lederer and Mew JJ.
BETWEEN:
HENIA GEFEN in her personal capacity and as estate trustee of the Estate of ELIAS GEFEN
Plaintiff/Appellant
– and –
ARIE GAERTNER, MILLER, CANFIELD, PADDOCK and STONE, LLP, THE JEWISH HOME FOR THE AGED, BAYCREST HOSPITAL, BAYCREST CENTRE FOR GERIATRIC CARE, YEHUDA GEFEN and HARRY GEFEN
Defendants/Respondents
AND BETWEEN:
HARRY GEFEN
Plaintiff by Counterclaim
– and –
HENIA GEFEN in her personal capacity and as estate trustee of the Estate of ELIAS GEFEN, HARVEY GEFEN, ASHLEY GEFEN, DUNDAS-THICKSON PROPERTIES LTD., 1393522 ONTARIO LIMITED and 1585708 ONTARIO LIMITED
Defendants by Counterclaim (Appellants in Appeal)
AND BETWEEN:
HARRY GEFEN
Third Party Plaintiff
-and-
HARVEY GEFEN
Third Party Defendant
ORAL REASONS FOR JUDGMENT
Lederer J.
Date of Oral Reasons for Judgment: February 24, 2021
Date of Release: March 1, 2021