Paul A. Dancause

The appellants appealed a mid-trial Rule 21 motion decision interpreting their late father's will and codicil.

The trial judge found that the trusts created by the will, which granted a life interest to the testator's widow, did not preclude her from accumulating wealth from the trust funds.

The Court of Appeal upheld the interpretation, finding the testator intended to provide generously for his widow without requiring her to conserve the estate for the remainder beneficiaries.

The Court also rejected the appellants' argument that the trial judge lacked jurisdiction to hear the mid-trial motion, noting they had consented to the procedure, though the Court cautioned against mid-trial Rule 21 motions.

Following a Rule 21 determination in estate litigation concerning whether trust monies paid to a life tenant could be accumulated, the successful defendants sought costs of the motion on a full indemnity basis.

The court held it was appropriate to fix costs immediately because the plaintiffs intended to appeal and the balance of the trial had been adjourned indefinitely.

Applying ordinary civil costs principles rather than the traditional estate-costs approach, the court found the plaintiffs acted unreasonably by failing to pursue an early interpretation issue and by framing the matter as a damages action rather than seeking directions.

Partial indemnity costs of $15,000 all-inclusive were awarded and charged against assets being held for the plaintiffs in the estates.

In an estates motion brought during trial, the court determined a question of law concerning whether a widow holding life interests under two testamentary trusts was prohibited from accumulating trust income in her own name.

Applying ordinary principles of will interpretation, the court held the testator's language conferred broad and unrestricted use of trust income for the widow's sole use and benefit, without any requirement to preserve unused income for remainder beneficiaries.

The court found no express or implied limitation requiring capitalization of unused income and emphasized the testator's stated intention that his wife's well-being and comfort take priority over preserving the estate.

The question posed on the motion was answered in the negative.

In an estate accounting dispute, a residual beneficiary sought disclosure of legal accounts issued by the estate solicitor to the estate trustee, alleging possible double billing to both the trustee personally and the estate.

The estate trustee resisted production on the basis of solicitor‑client privilege.

The court held that communications between an estate trustee and solicitor regarding administration and distribution of the estate are not privileged as against beneficiaries due to the “joint interest” principle.

Because the documents related to estate administration rather than personal protection of the trustee against claims, privilege did not apply.

The court ordered production of the legal fee documents and noted that, if discovery were necessary, the trustee could be examined by written questions due to medical limitations.

Costs endorsement following a motion in which the applicant was entirely successful.

The court found the motion brought by the responding parties to be ill-advised and held that the successful party was entitled to substantial indemnity costs.

The court ordered one of the respondents to pay the applicant $4,000 in costs on an all‑inclusive basis within 30 days.

A trustee brought a motion for security for costs under Rule 56.01 against a beneficiary who had commenced an application seeking to compel the trustee to pass accounts and to challenge an arrangement permitting occupation of trust property rent‑free.

The moving party argued the beneficiary resided outside Ontario and lacked sufficient assets to satisfy a potential costs award.

The court held that the underlying proceeding formed part of the beneficiaries’ right to require a trustee to account for the administration of the trust.

The court also noted that other beneficiaries, represented by the Children’s Lawyer, had interests in the proceedings and that the objections raised regarding trust disbursements were not frivolous.

In these circumstances, security for costs was not appropriate.

An estate trustee sought court approval of estate accounts on a passing of accounts application.

A beneficiary objected, alleging mismanagement including improper distributions, executor compensation, undervaluation of land, and administrative delays.

The court found the objections to be unfounded and confirmed the trustee had acted within the broad discretionary authority granted under the will and in good faith.

The accounts were approved.

Because the objections caused additional unnecessary litigation expense, the court ordered a portion of the resulting costs to be deducted from the objector’s entitlement.

The settlor established a family trust for his grandchildren, appointing his three children as trustees.

A dispute arose, and two of the trustees sought to remove the third and sell the trust property.

The trial judge ordered the sale of the property to break the impasse.

On appeal, the court found that the trial judge erred in ordering the sale without the unanimous consent required by the trust deed and without evidence of benefit to the beneficiaries under the Variation of Trusts Act.

The court set aside the sale, removed the two applicant trustees due to their conduct, and left the third trustee in place.

The trial judge's costs awards against the removed trustees personally were upheld.

The appellant appealed a trial judge's decision regarding the capacity of the respondent.

The appellant argued that the experts erred in quantifying the needed capacity and that the fluctuating nature of the respondent's capacity should have shifted the onus of proof.

The Court of Appeal dismissed the appeal, finding that the experts properly applied the criteria in s. 8 of the Act and that the legal onus remained on the appellant.

The trial judge was entitled to accept the expert evidence presented.

The appellant appealed a decision of the Federal Court of Appeal regarding the inclusion of his German pension benefits in calculating his tax liability under Part I.2 of the Income Tax Act.

The Supreme Court of Canada dismissed the appeal, agreeing with the Federal Court of Appeal that the provisions of the Canada-Germany Tax Agreement do not prevent the operation of s. 180.2 of the Income Tax Act.