CITATION: Belec (Estate Trustee of Kelly) v. Kelly, 2025 ONSC 3840
DIVISIONAL COURT FILE NO.: DC-22-1330
(Oshawa) DATE: 20250627
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
D.L. Corbett, Shore and M. McArthur J.
BETWEEN:
Jodi Belec, Estate Trustee of the Estate
Joseph J. Neal, for the Appellant
Of Bradford Jonathan Kelly
Applicant / Appellant
– and –
Everett Kelly and Douglas Flintoff,
Kennedy Levesque, for the Respondent
Estate Trustee of the Estate of Joan
Flintoff
Respondents / Respondent
HEARD at Oshawa (by videoconference):
June 25, 2025
REASONS FOR DECISION
The Court
[1] This is an appeal from the unreported decision of S.T. Bale J. dated August 10, 2022, directing payment to the Respondent, Everett Kelly, for a net amount of $18,719.63 for expenses paid by him on behalf of the Estate of his late brother, Bradford Jonathan Kelly. The issue before the application judge, framed by the Appellant, the Estate trustee, was whether the Respondent’s claim for reimbursement was barred by s. 38(3) of the Trustee Act.
[2] We would dismiss the appeal, substantially for the reasons of the application judge.
[3] With respect, the Appellant’s position on this issue has been unreasonable from the outset. There is no reason, in principle, why the deceased’s brother should be required to pay the Estate’s bills without reimbursement. The claim for reimbursement was made in a timely way to the Appellant after she was appointed as Trustee. The claim was in respect to unremarkable expenses (funeral, reception, credit card, and real property utility bills) is facially reasonable and ordinary amounts.
[4] The application judge stated the issue before him, quoting from the Appellant’s application for advice and directions (Decision, para. 1):
In this application, the applicant requests:
[T]he opinion, advice or direction of the court “as to whether the Applicant is required to pay to the Respondents the debts claimed by the respondents from the estate of Bradford Jonathan Kelly… or are the Respondents’ claims for debts statute-barred pursuant to s. 38(3) of the Trustee Act, R.S.O. 1990, c. T.23.
[5] The Appellant’s submission to the application judge that the indemnification claim of the Respondent was barred by s. 38(3) of the Trustee Act was, on its face, without merit. As the application judge carefully explained, s. 38(3) applies to claims arising from alleged wrongs committed by the deceased (obviously before their death), and not to ordinary debts of the Estate or claims for indemnification for expenses incurred on behalf of the Estate (Decision, paras. 9-11).
[6] The Appellant argued before the motions judge, in the alternative, that the Respondent’s claims were barred pursuant to s. 5 of the Limitations Act, 2002, S.O. 2002, c. 24, Sch. B. The motions judge entertained this argument, even though it had not been expressly pleaded in the request for advice and directions. As quoted by the motions judge (Decision, para. 13), s. 5(1) of the Limitations Act provides:
A claim is discovered on the earlier of,
(a) the day on which the person with the claim first knew,
(i) that the injury, loss or damage had occurred,
(ii) that the injury, loss or damage was caused by or contributed to by an act or omission,
(iii) that the act or omission was that of the person against whom the claim is made, and
(iv) that, having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it; and
(b) the day on which a reasonable person with the abilities and in the circumstances of the person with the claim first ought to have known of the matters referred to in clause (a).
[7] Section 4 of the Limitations Act provides:
Unless this Act provides otherwise, a proceeding shall not be commenced in respect of a claim after the second anniversary of the day on which the claim was discovered.
[8] The application judge found that the claim was not “discovered” (within the meaning of s. 4) until the Respondent first knew that the Appellant had been appointed estate trustee, in March 2017. The Respondent asserted his claim for reimbursement to the Appellant, who denied the claim and who then sought advice and directions in respect to the claim by commencing the application before the application judge, all within two years of the Appellant’s appointment as estate trustee.
[9] We agree with the application judge that a claim for reimbursement was “commenced” when the Appellant applied for advice or directions from the court in respect to the Respondent’s reimbursement claim. Once that application was commenced, the issue was before the court for decision, and there was no need for the Respondent to commence a separate claim. The fact that the Respondent did so, eventually, does not affect this analysis.
[10] We also agree with the application judge that the respondent’s claim for reimbursement did not arise before the Appellant was appointed as estate trustee. We are not, however, sanguine with the application judge’s finding that the limitations period began to run when the Appellant was appointed as estate trustee. In our view, it began to run later. In an affidavit filed in support of her application to be appointed trustee, the Appellant undertook to pay the Estate’s obligations from Estate assets in her capacity as trustee. This is an ordinary promise and gives rise to an expectation that the process for settling the Estate’s debts will unfold by claimants making timely claims to the trustee. There is no default by the Estate, and no reasonable basis to sue, until the claim is made to the trustee and the trustee fails or refuses to pay the claim. Where, as here, the trustee denies a claim but then seeks advice and direction from the court respecting the claim, there is no need for the claimant to commence a separate proceeding.
[11] In making these observations, we do not wish to be taken to criticize the application judge. The application judge provided a brief endorsement that was more than sufficient given the nature and size of the claim and the arguments made to him. Had the application judge stated that the earliest date he would fix for commencement of the limitations period was the date of formal appointment of the estate trustee, the effect would have been the same for this case.
[12] The Appellant argued that – since the motions judge did not reference jurisprudence in his decision, that we may take this case as a matter of first impression and should provide some “guidance” for future cases with our decision.
[13] With respect, the circumstances of this case do not raise an unusual fact situation. Estate business is frequently conducted before formal appointment of a trustee – ongoing bills must be paid, the obsequies must be arranged and paid for, and, indeed, Estate dependents may require support to meet their ongoing needs.
[14] In the instant case, the Respondent and the Appellant made competing claims to be appointed as estate trustee. Had the Respondent been appointed, he would have been entitled to reimbursement for his pre-appointment payments on behalf of the Estate, subject to a passing of accounts. He was not appointed as trustee, and so he requested reimbursement from the Appellant, who had undertaken to pay the Estate’s obligations from Estate assets. Only when the Appellant refused to pay did the limitation period begin to run, and the limitation period was satisfied when the Appellant sought advice and directions from the court on the issue.
[15] We appreciate that there was a series of conflicts regarding the administration of the Estate and that virtue may not lie all on one side throughout. That does not affect our analysis of this appeal. The Appellant is responsible to administer the Estate in accordance with the law, including her undertaking – and her personal animosity towards the Respondent, well-founded or otherwise, should not get in the way of her administering the Estate properly.
[16] During the course of argument, Appellant’s counsel argued that this appeal would only dispose of the limitations issue and would leave any dispute about the propriety and quantity of items included in the Respondent’s claim for determination. Counsel noted that part of the claim was an expense of $3,500, said to have been paid in cash. We would not accept this argument; the application judge disposed of these issues.
[17] The motions judge found that the amount owing was $18,719.63, after netting out $2,500 already received by the Respondent. This is a finding of fact which this court will not disturb on appeal absent palpable and overriding error. We have examined the record below and there is no basis for varying the application judge’s order to leave the specific items of claim to be decided in a fresh process. The application before the motions judge was a request for advice and directions from the Appellant and a request for reimbursement of the specified amounts by the Respondent. The Respondent gave evidence that he incurred the claimed expenses, and the motions judge found that the Respondent “joined issue with the [Appellant] by filing his responding materials, including particulars of the amounts claimed, with supporting documents” (Decision, para. 14). It is crystal-clear from the record before us that the quantum and propriety of the Respondent’s claims were before the motions judge and that he decided those issues. There is no basis upon which we would interfere with the application judge’s findings on these points.
[18] In argument before us, counsel for the Appellant sought to raise other statutory provisions that he argued would preclude the Respondent’s claim – including an order of Salmers J. that the Respondent provide an accounting, and events that took place following that order. This issue was not raised in the record before the application judge and we would not permit the Appellant to raise it as a fresh argument on appeal.
Delay in this Appeal
[19] We were concerned by the delay in bringing this appeal to a panel of this court. The decision of the application judge was delivered almost three years ago. From our discussion with counsel, we are satisfied that counsel made reasonable efforts to schedule the appeal, and that it was not until counsel was able to get this matter before a judge for a case management conference last fall that the appeal was scheduled on a reasonable schedule – for what was then the earliest available date before a panel in Oshawa. For future reference, in any matter in the Divisional Court, assistance may be had from a case management judge for scheduling directions in any case. A party who experiences difficulty obtaining a case management conference may seek assistance from the Regional Divisional Court administrative judge (in Central East, currently Justice Charney), a Divisional Court administrative judge in Toronto (currently Justices O’Brien and Shore), or the Registrar of the Divisional Court in Toronto. Parties may also have reference to the Consolidated Practice Direction and the guides found on the Superior Court’s web site for the Divisional Court to assist in navigating this court’s processes.
Disposition
[20] We would dismiss the appeal, with costs fixed at $5,546.04, inclusive, payable by the Appellant to the Respondent within 30 days.
“D.L. Corbett J.”
I agree: “Shore J.”
I agree: “M. McArthur J.”
Date of Release: June 27, 2025
CITATION: Belec (Estate Trustee of Kelly) v. Kelly, 2025 ONSC 3840
DIVISIONAL COURT FILE NO.: DC-22-1330
(Oshawa) DATE: 20250627
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
D.L. Corbett, Shore and M. McArthur J.
BETWEEN:
Jodi Belec, Estate Trustee of the Estate
Of Bradford Jonathan Kelly
Appellant
– and –
Everett Kelly and Douglas Flintoff,
Estate Trustee of the Estate of Joan
Flintoff
Respondent
REASONS FOR DECISION
D.L. Corbett J.
Date of Release: June 27, 2025