NEWMARKET COURT FILE NO.: CV 11-103965-00

DATE: 20120504

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: ANTONIO LAGANI, Applicant

AND:

NICOLA LAGANI AND IMMACOLATA MONTESANO IN THEIR CAPACITY AS NAMED ESTATE TRUSTEES FOR THE ESTATE OF MARIA LAGANI, DECEASED AND IN THEIR PERSONAL CAPACITIES, FRANCO LAGANI AND ROSA AMATIELLO, Respondents

BEFORE: THE HONOURABLE MR. JUSTICE J.P. MCDERMOT

COUNSEL: P. Trudelle, for the Applicant

R. D’Ambrosio, for the Respondents

HEARD: February 29, 2012

ENDORSEMENT

INTRODUCTION

[1] The Applicant and the Respondents in this matter are the children of Maria Lagani (“Maria”), who died on January 12, 2010 in her 91st year. Maria made identical wills in 2006 and 2009 leaving the residuary to her five children; however, she also provided for specific bequests of $75,000 for each of her children other than the Applicant, Antonio Lagani (“Tony”) who received only the residual bequest.

[2] At the date of her death, Maria had lived with her daughter, the Respondent, Rosa Amatiello (“Rosa”) and her husband, Mike Amatiello (“Mike”) for about ten years at a residence located at 40 Palmer Avenue, Richmond Hill, Ontario. This home was purchased by Maria in 2001 for $269,900.

[3] As noted, Maria was aged and the Respondents state that she required increasing assistance in her day to day care after her husband’s death. It is their evidence that Rosa and her husband agreed to provide that assistance, but on the basis that, after Maria’s death, Rosa could purchase the Palmer Avenue property from the estate at the same cost that Maria had paid for the home. That is a significant benefit as the home is now worth between $440,000 and $450,000.

[4] After the date of Maria’s death, the Trustees of the estate under the 2009 will, the Respondents Nicola Lagani (“Nick”) and Immacolata Montesano (“Margaret”) instructed the estate solicitor to draft a document entitled “Acknowledgement & Agreement” (the “Agreement”) that reflected this arrangement as well as reducing each beneficiary’s share of the estate to enable Rosa to buy 40 Palmer Avenue from the estate. Tony’s signature appears on this Agreement; he said in evidence that he only signed the last page and did not see the whole agreement when he signed it. Neither of the Estate Trustees signed the Agreement although the other beneficiaries of the estate did.

[5] Tony has filed a Notice of Objection attacking both the 2006 and 2009 wills executed by Maria. He says that she was not competent to make either of the wills when they were signed. He further denies the validity of the Agreement or that it is enforceable.

[6] This matter was brought into court through an order for directions made by Sosna J. on May 12, 2011 which set out the issues for trial and provided for disclosure of information by the estate. The order provided, inter alia, that the validity of the Agreement was to be tried separately from the main relief concerning the will; this motion is the result. Tony also brings a motion to force the sale of 40 Palmer Avenue because certain disclosure ordered by Sosna J. has not been provided and because Rosa and Mike continue to reside in that home without payment of rent to the estate. Tony also asks for an order that certain outstanding disclosure under the Sosna J. order be provided by the estate forthwith.

[7] There have been cross examinations of both Tony and Margaret; the transcripts were filed and referred to in argument on the motion. In reviewing these transcripts, it became apparent to me that there were credibility issues at play in this motion, as there was significant disagreement on the facts leading up to the signing of the Agreement as well as circumstances under which Rosa and Mike lived with and cared for Maria. No agreed statement of facts was filed. I suggested to counsel during argument that this matter would be best dealt with at a trial where viva voce evidence is led and determinations as to the credibility of the witnesses can be taken into account in making findings of fact; both counsel indicated on the record that the parties wished the issue of the agreement to be dealt with summarily and that I was accordingly to make findings of credibility or fact based upon the affidavits and transcripts as filed. The argument of the motion proceeded on that basis.

[8] For the reasons set out below, I have determined that the Agreement is both valid and binding on the parties. The Applicant’s motion to sell 40 Palmer Avenue and for disclosure is dismissed.

BACKGROUND FACTS

[9] Maria and her husband, Vito Lagani (“Vito”) had five children; all of them are parties to this proceeding. The Respondents Margaret and Nick are the Estate Trustees under Maria’s will made in 2009 and are also beneficiaries under that will. Franco and Rosa are similarly beneficiaries under that will; Rosa had lived with Maria along with her husband, Mike, up to the date of Maria’s death for about ten years. They continue to reside in the home purchased by Maria which is the subject matter of this motion.

[10] The Applicant, Tony, is also a beneficiary under that will. He is a real estate developer building residential and commercial properties and has been working as a builder and developer for the past 39 years; Mike stated in his affidavit that Tony has developed at least two subdivisions. He was partners with Margaret’s husband for some time; eventually, he went into business on his own and owns a company, Tri Lag Corporation Ltd. through which he has operated his development business for the past 17 years. Tony stated that he originally worked in residential development; his focus is now on commercial projects. He confirmed in examinations that he was a knowledgeable and experienced businessman and often signed agreements without consulting with his lawyer. He said that he signed over a thousand contracts in the course of his business as a builder.

[11] On April 10, 1995, Maria executed a last will and testament. In that will (which incidentally was prepared by the same lawyer that Tony used, Bruno Di Gregorio), Maria bequeathed all of her property to her children equally without deduction.

[12] Subsequent to this, in 1997, Maria and Vito advanced a sum of money to Tony. Margaret states it to be $100,000 but all of the documentation refers to the amount in issue being $75,000. Tony confirms that he received $75,000 which he claims to be a gift; he stated in his cross examination that, “[m]y mother gave it to me between me and her.”

[13] Although Tony claims a gift, there is substantial evidence that it was a loan. On February 20, 1999, Maria signed a note which was in Italian, stating the following:

February 20, 1999

I, the undersigned, Maria Lagani,

declare that I gave in loan

to my son, Tony Lagani,

the sum of $75,000.

In case he does not return them

back,

they have to be discounted from the end

inherited.

Mrs. Maria Lagani

[14] There was further evidence that Maria intended a loan. The lawyer’s notes from a meeting with Maria on December 12, 2006 regarding the 2006 will indicated that Maria was concerned about what to do if Tony repaid the $75,000 loan (which, as noted below was reflected in the terms of the will, which, as in 2009, gave each child beneficiary a specific gift of $75,000 other than Tony); the lawyer told Maria that she could then do a codicil. There was also cheque tendered in evidence and dated May 5, 2007 from Tri Lag Corporation Ltd. to Maria in the amount of $75,000; that cheque stated on its face that it was regarding a “loan paid back” and it was dishonoured for insufficient funds.

[15] In any event, subsequent to the advance of the funds to Tony, Vito died and Maria began to spend increasing amounts of time with Rosa and Mike who rented premises on Bluegrass Blvd. in Richmond Hill. According to the affidavit sworn by Mike, he and his wife, Rosa, began to discuss purchasing a home in 2001 and Maria indicated that she wished to “live in her own home” and that “we were to live with her in the home.” Margaret stated in her affidavit that Maria needed a new home as the home she lived in was not suitable for her considering her age. The concern of Rosa and Mike was that if Maria purchased the home and they lived with her in the home, they would not be able to afford a home in the future as the housing market was increasing rapidly at that time.

[16] Mike deposes that an arrangement was made between himself, Maria, Rosa and Nick which involved Maria purchasing a home more suitable to her needs; Rosa and Mike would live in the home with her and would provide “care and support” for Maria. If they provided that care and support, Rosa and Mike would be able to purchase that home for the original price paid by Maria when she bought the home. Mike said that the agreement of all of the siblings, including Tony, was obtained prior to the home being purchased by Maria. According to the affidavits of Mike and Margaret, 40 Palmer Avenue in Richmond Hill was purchased by Maria on October 31, 2001 for $269,900 and Rosa and Mike moved in with Maria after that date pursuant to that arrangement. There is no written evidence of the care giving arrangement made between Rosa, Mike and Maria.

[17] Both Mike and Margaret depose in their affidavits that all of the siblings were well aware of this arrangement. Both state in their affidavits that Maria would often remind all of her children, including Tony, of this arrangement and that they were expected to adhere to the arrangement after her death.

[18] Tony strongly disagrees with these assertions. He states that he was never made aware of the arrangement between his mother and Rosa and Mike. He states in his affidavit that, “[m]y mother never mentioned this arrangement to me.” In his cross examination, he states that he knew “[a]bsolutely nothing” about the promise and that, “[m]y mother never would have promised her nothing.” He later acknowledges that the siblings had discussed it but it was it was what “they wanted to do, not what my mother’s wishes were.” He says that Rosa “screwed” Maria. He claims that he never discussed it with his other siblings, who he said he had not talked to for some time; he does acknowledge discussing the issue with Rosa, but says that he only agreed to see what the result from the will was after his mother’s death, after which he told Rosa, “I will see what I’m going to do.”

[19] Tony also states that Rosa and Mike, in point of fact, did little, if any care giving for Maria. He states that Rosa worked and as such was there only outside working hours; he says that he and his siblings did more for his mother than did Rosa. He said that Rosa got a “free ride” and that if anyone helped anyone, Maria “looked after [Rosa’s] husband” who was an “invalid”. He stated that Maria cooked for Rosa and Mike and that Maria was a “companion” to Mike. Any assistance that Maria received came from paid caregivers or assistants paid for by Maria. This care giving provided by Maria to Mike and, to a lesser extent, Rosa, is notwithstanding the fact that, earlier in his cross examination, Tony referred to Maria as a “vegetable” and said that she was “not there period” for between six to ten years prior to her death.

[20] On the other hand, Margaret states in her examination that Mike and Rosa lived in the home with Maria for the last ten years of her life, and did provide the care and companionship to Maria that they had contracted to do. Rosa was not paid for the care giving provided to Maria. She states that Rosa and her husband paid the expenses of the Palmer Road property other than realty taxes, which were paid by Maria. Tony acknowledges that Rosa and her husband paid some of the household costs, but not all of them.

[21] As has been noted by Tony, the care giving and house purchase arrangement was not reflected in any of the documentation filed in this proceeding. Maria did wills in 2006 and 2009; both of those wills were identical and named Nick and Margaret as Estate Trustees; they also both contained a preferential distribution of $75,000 to all of the siblings excluding Tony with the residue after that specific bequest being divided between all five siblings equally. In late 2009, the Palmer Avenue property was transferred by Maria to herself as well as Nick and Margaret jointly; presumably that was to take the property out of the estate in order to save the estate fees which are based upon asset value; the property would flow into the names of the executors of the estate without cost based upon a right of survivorship. A trust agreement was entered into on December 1, 2009 confirming that Nick and Margaret held the property in trust for Maria and confirming that, upon her death, “the Trustees shall deal with the Subject Lands in accordance with the Beneficiary’s Last Will and Testament”; again this trust agreement does not mention or refer to the promise to convey the property to Rosa and Mike for the original price paid by Maria for the property.

[22] Maria died on January 12, 2010, soon after the lands were conveyed to her Estate Trustees. Margaret states in her affidavit that, shortly after Maria’s death, she gave instructions on behalf of the estate to put into effect the intent of her mother to convey the Palmer Road property to Rosa and Mike at a price of $270,000.

[23] There was a difficulty, however. Rosa and Mike did not have enough money to purchase the Palmer Road property. They had $100,000; they also had the specific bequest of $75,000 from her mother as well as the residual amount which was estimated to be in the amount of $34,000. This gave them $209,000 to put towards the property; they were $61,000 short.

[24] The solution that was apparently arrived at was that each party (other than Rosa) would reduce their share of the estate by $15,250 to make up the $61,000 between them; that amount would be deducted from their respective shares of the estate. The proposal was that the estate would take back a collateral mortgage on the property for two years for that amount; if the property was sold by Rosa and Mike during that period of time, then the estate would collect back the $61,000 which the beneficiaries decided to forego to allow Rosa and Mike to purchase 40 Palmer Avenue.

[25] Margaret states that she instructed the estate solicitor, Gray & Associates, to draft an agreement reflecting this arrangement and they apparently did so. She says that all of the beneficiaries of the estate, including Tony, met in August to discuss the terms of the Agreement as prepared and they came to a consensus that they would enter into that agreement. She states that Tony told her that Rosa could have his entire share of Maria’s estate based upon the care that Rosa had given his mother. It is unclear from Margaret’s affidavit as to whether the draft agreement was circulated at that meeting; implicit in her materials and in testimony given on cross examinations is that it had been prepared prior to the meeting.

[26] After this meeting, Margaret says that she prepared five copies of the Agreement for execution. A copy of that agreement as signed by Rosa, Tony and Franco is attached as a schedule to these reasons. Presumably, the copies of the Agreement were delivered to Rosa at 40 Palmer Avenue for execution. Margaret states that, at some time, she told Tony to take them to his lawyer and sign them with his lawyer.

[27] The Agreement tendered on the remaining beneficiaries by the estate reflected that 40 Palmer Avenue would be purchased by Rosa from the estate for $270,000. The agreement contains a number of recitals; included is the fact that the property was worth $400,000 (it had not then been appraised); the agreement then stated that notwithstanding this value,

The Property shall be sold to Rosa, in accordance with the wishes and desires of Maria Lagani, and further, that the sale of the Property and contents therein shall be in the amount of Two Hundred and Seventy Thousand Dollars ($270,000);

[28] The Agreement then recites the shortfall suffered by Rosa, and states that all of the beneficiaries other than Rosa would reduce their legacies by an amount equaling $61,000 (reducing each parties’ $34,000 residual benefit to $18,750 each); the agreement then recites that that upon Rosa paying $100,000 to the estate, the Palmer Avenue property would be transferred to her and the following amounts would be paid from the Estate to the remaining beneficiaries:

Nicola Lagani - $75,000.00 legacy + $18,750.00 residue = $93,750.00

Franco Lagani - $75,000.00 legacy + $18,750.00 residue = $93,750.00

Immacolata Montesano - $75,000.00 legacy + $18,750.00 residue = $93,750.00

Antonio Lagani - $0.00 legacy + $18,750.00 residue = $18,750.00

Total: $300,000.00

[29] The agreement then provides for the registration of a collateral mortgage for $61,000 and that it would be security for repayment of these funds should Rosa sell the property within two years of the date of transfer; otherwise the mortgage would then be forgiven.

[30] The agreement further provided that it was being tendered on behalf of the estate and that each party would retain their own solicitors:

And whereas it is agreed that this Acknowledgement and Agreement was prepared by Gray & Associates under instructions from Nick and Margaret and that Gray & Associates will continue to act under the instructions of Nick and Margaret and solely on behalf of the Estate in this matter;

And whereas Rosa will retain her own solicitor to facilitate the purchase of the Property;

And it is agreed that Rosa, Antonio Lagani and Franco Lagani shall receive Independent Legal Advice for this Acknowledgement and Agreement and the terms herein and that Gray & Associates is not representing the interests of Rosa, Antonio or Franco.

[31] Mike states in his affidavit that when he received the agreement, he called Tony to come to his residence to review and sign it. Tony attended at the residence at 40 Palmer Avenue, and Mike said that he, Rosa and Tony were in the living room when he gave Tony the agreement to review. He says that Tony read the agreement in its entirety; Rosa told him to take the agreement to his lawyer, but Tony said he was a “businessman and familiar with contracts” and that he did not need his lawyer to review the agreement. Mike deposed that Tony said he did not want anything from the estate and that the mortgage was unnecessary as far as he was concerned. After a second suggestion from Rosa that Tony take his agreement to a lawyer which was again refused, he moved to the dining room and signed the agreement; Mike witnessed Tony’s signature and eventually delivered it back to Nick. Rosa and Franco also signed the agreement.

[32] Tony’s version of events is entirely different. He says that he was not presented with the entire agreement; he was only presented with the signing page and the distribution of the estate as noted above. He states that he was told by Mike that the will had provided that the home would be transferred to Rosa for the reduced price and that he was misled as a result. In cross examination, he stated that he was only presented with page 4 to sign and the calculation of the distribution of the estate as noted above. He acknowledges signing that document, but states that there were no other pages attached to the signing page. He said that he did not get the whole of page 2 (which had the calculations) but just a copy of the calculations. He even states that the provision on the signing page which stated that Rosa, Tony and Franco would obtain legal advice was not on the page when he signed it. He stated that normally he would have insisted upon reading the agreement, but because he trusted his sister implicitly, he did not read the agreement as he believed that his mother’s will confirmed the agreement to sell Rosa the home for $270,000.

[33] Tony did not obtain independent legal advice. Instead he says that he went to see a lawyer at Gray & Associates, which was the estate solicitor. He asked for a copy of the will; as he put it in his examinations, when speaking of the $18,750 that he was to receive,

My mother left in the will this money for me, that’s what they told me, and that’s when I went to the lawyer, says, nope, I want to see the will. So this is what they made up, it was two pages, and I said if this is what it states into the will, I will follow it to a tee, if this is not what says into the will, I’m not interested. When I went up there to their lawyer, I went to their own lawyer, he says, no, this is not what it says into the will.

[34] As a result, Tony withdrew his consent to the transfer of the property, and that transaction has not taken place, although Rosa has paid a sum of money to her lawyer for the abortive transfer. When Tony withdrew his consent, neither Margaret nor Nick had signed the Agreement; the agreement which was attached as an exhibit to Mike’s affidavit has not been signed by either Margaret or Nick.

[35] Tony’s evidence that he only signed the last page of the agreement was called into doubt through the filing of the report of G.D. Ospreay & Associates who are forensic document examiners; that report examines, based upon impressions left on the sheets of paper, whether pages 1 to 3 of the agreement were underneath the signing page of the agreement when it was signed by Tony. There were two agreements provided to the forensic document examiner; these agreements had been signed by all five parties. The forensic examiner concluded that, respecting both the agreements, that “[t]here is sufficient evidence to support a conclusion that pages #1-2 of [the original agreements] were oriented beneath page #4 when it was signed by Antonio Lagani.” Apparently the last page (p. 3) had a faint impression which was diminished to the point that a true match could not be had; however even respecting p. 3, the author said that it was “probable” that the impression on that page was Tony’s.

[36] Presumably because of this report, Mr. Trudelle on behalf of Tony acknowledged during argument that Tony had an opportunity to review the entire agreement prior to execution and that he signed the complete agreement. He effectively withdrew his client’s evidence that the Agreement had been signed by Tony in blank.

[37] In December, 2010, the home was appraised at being worth $440,000; Tony has also filed a real estate agent’s opinion of value stating that the property is worth $450,000. If the property has increased in value to $440,000, this represents an increase in value of $170,000 or $17,000 for every year that Rosa and her husband provided care for Maria. Margaret states that the $400,000 value in the Agreement is reasonable considering real estate commission and the fact that the estate appraisal was completed almost a year after Maria’s death. It is to be noted that if it found that the Agreement is not binding upon the parties, Mike stated in his affidavit that his wife intends upon bringing a claim in quantum meruit for an interest in that property based upon services provided to the deceased prior to her death.

ANALYSIS

[38] There were several issues raised by the motions filed in this matter which are as follows:

(a) Is the Agreement binding on the Applicant?

(b) Should the Estate Trustees be compelled to sell the property located at 40 Palmer Avenue, Richmond Hill, Ontario?

(c) Should the Estate Trustees be compelled to produce a list of the assets of the estate as required under the order of Sosna J. dated May 12, 2011?

[39] I shall deal with each of those issues in turn; the issue of the sale of the home should be dealt with subsequent to the issue of the Agreement for obvious reasons.

Is the Agreement binding on the Applicant?

[40] There are several different determinations to be dealt with under this heading. Firstly, there are factual issues raised by the Applicant; he states that there were misrepresentations made by Rosa and Mike, and initially he said that he did not properly sign the agreement. He states that he changed his mind about the sale of the property to Rosa only when he discovered the terms of the Applicant’s will. He says that there was never a discussion about the arrangement to transfer 40 Palmer Avenue to Rosa at a reduced cost, and he knew nothing about that arrangement other than the fact that he was told that it was in his mother’s will. Tony’s evidence is in conflict with that of Margaret and Mike, and I have to make findings of fact considering the significantly different versions of events provided by the parties.

[41] As well, Tony raises legal issues. He notes that the Agreement states that it was subject to obtaining independent legal advice and as such, he did not understand what he was signing, and the agreement was subject to being set aside once that advice was obtained. Moreover, he notes that the Agreement was not signed by all parties prior to his withdrawal from the arrangement; he states that the Agreement is accordingly not binding upon him because it had to be signed by all parties to become effective. He also states that the agreement is not binding on him because of the misrepresentations made to him by Mike when he signed the Agreement on August 2, 2010.

FACTUAL ISSUES

[42] The estate seeks to enforce the Agreement; Margaret states that the agreement by the estate to sell 40 Palmer Avenue to Rosa was presented to the parties at a meeting of all of the parties who approved and agreed to the arrangement reflected in the Agreement. After this meeting, copies for execution were prepared and left at Rosa’s for execution. According to Margaret, the terms of that arrangement was agreed to at the beneficiaries’ meeting held between the parties and this Agreement was reflected in the document Tony signed on August 2, 2010. Margaret states that Tony has now changed his mind, and should not be permitted to do so.

[43] Tony’s initial evidence in this motion was that he did not sign the agreement in question. He states that he signed a blank signing page which was not attached to anything, and that all that he was provided was the proposed distribution of the estate found on p. 3 of the agreement. He states that there was never a prior agreement or stated intention of Maria that Rosa could purchase 40 Palmer Avenue from the estate at the original purchase price paid by Maria. He denies that there was ever any discussion of an arrangement to transfer to the property to Rosa at the original price paid by Maria and says that it was never discussed with him. He states that when he attended at Rosa’s residence, he was presented with a blank signing page and a statement of the proposed distribution of the estate; it was his evidence that he was told that this, as well as the arrangement respecting the purchase of the property, was set out in his mother’s will. He says that there were no other terms of the agreement provided to him, and that he never saw them until they were filed in court. He finally states that when he finally saw the will, he realized that he had had the facts misrepresented to him by Rosa and/or Mike, and at that time he repudiated the arrangement that he had signed on to; he now disputes the validity of both the 2006 and 2009 wills.

[44] As noted above, and presumably due to the report of the forensic document examiner, Tony’s solicitor acknowledged in argument that Tony did, in fact, sign the entire agreement; he presumably still says that he was told that the Agreement reflected the terms of his mother’s will and as such, there is a material misrepresentation which vitiates the Agreement.

[45] The motion in respect of the validity of the Agreement purports to be brought under Rule 21 of the Rules of Civil Procedure[^1] (determination of a legal issue before trial). However, as noted above, I am not being asked to only decide on a legal issue; there are disputed issues of fact before me and to properly determine the matter, I need make credibility determinations and weigh evidence arising from the vastly different stories told by each of the parties. Moreover, the within motion is brought pursuant to para. 2 of the order of Sosna J. dated May 12, 2011, which required the issue of the validity of the agreement to be “tried separately from the other issues” raised by the Notice of Objection filed by Tony. As we are effectively dealing with the trial of an issue through argument of a motion, I presume accordingly that the jurisdiction for this motion is pursuant to Rule 20.04(2)(b) which allows a part or all of a claim to be determined summarily where the parties so agree:

(2) The court shall grant summary judgment if,

(b) the parties agree to have all or part of the claim determined by a summary judgment and the court is satisfied that it is appropriate to grant summary judgment.

[46] As noted above, both counsel agreed that I would have to make determinations as to the credibility of the parties; it was apparent to me that there were substantial differences in the evidence given by the parties in respect of the negotiation and execution of the agreement. No agreed statement of facts was filed. Accordingly, as with a motion brought under Rule 20.04(2)(a), I may weigh evidence, determine credibility and draw inferences from the evidence; although Rule 20.04(2.1) is not applicable to a motion under Rule 20.04(2)(b), those powers are implicit through the agreement of counsel to determine the validity of the Agreement when there are vastly different stories being told by each side to the motion.

[47] Unfortunately, I am forced to determine that Tony’s evidence as provided in his affidavit, and on cross examination is without credibility. His evidence is replete with inconsistencies and apparent untruths. He makes a number of assertions in cross examinations which were disproven by credible written evidence or compelling forensic evidence. He withdrew his position that he had not seen the agreement only in the face of overwhelming forensic evidence and when he saw that there was little choice but to do so. As such, much of his evidence is disproven in its entirety; Tony’s remaining evidence and the truthfulness of any remaining evidence is called into question by the fact that he clearly gave untrustworthy evidence regarding a number of issues surrounding this motion.

[48] For example, Tony stated on a number of occasions in both his affidavit and in his cross examination that the $75,000 advanced by his parents to him was a gift. This was clearly disproven by the note authored by Maria in 1999, the notes from the lawyer in the preparation of the 2006 will and the cheque from Tri Lag Corporation Ltd. which was dishonoured, but states that it was for the repayment of a loan. All of these constitute written evidence of a loan arrangement between Tony and his mother, and the wills signed by Maria are consistent with that arrangement. Tony’s evidence that the $75,000 was a gift is simply not believable.

[49] Moreover, Tony states that he did not sign the agreement; he said in evidence that he signed a blank signing page with nothing attached to it. He says in sworn testimony that he was given two sheets of paper being the signing page and the distribution of assets. He produced neither of these documents as part of his evidence. He admitted his signature but denied that there was even a provision respecting independent legal advice included in that signing page; if it was added afterwards, the addition was skilfully done based upon the copy of the agreement that I was provided. Moreover, the report of G.P. Ospreay & Associates puts paid to the assertion that there were no pages attached to the agreement; that report concludes that at least pages 1 and 2, and probably p. 3 were attached when Tony affixed his signature to that document; the impressions of that signature were apparent when the document was signed. Tony finally admitted that he signed the complete agreement when he saw that he had little choice but do so due to the forensic report. Again, extensive portions of Tony’s evidence given on cross examination regarding what he signed on August 2, 2010 is simply not credible.

[50] These assertions of Tony being called into question, his remaining evidence also becomes problematic when contrasted with the evidence of both Mike and Margaret. For example, it was the evidence of Tony given in his cross examinations that he told Mike that he would abide by the wishes of Maria as set out in her will; when he found that the will did not contain the arrangement respecting the purchase of 40 Palmer Avenue, he repudiated the Agreement based upon the fact that the will did not contain those provisions. However, Tony is now contesting the validity of that will in these proceedings; that is hardly following the will “to a tee” as he asserted during cross examinations. As well, Tony said during his examinations that his mother was a “vegetable” and was not competent. However, he also said that she was a companion to Mike and that she actually cared for Mike rather than it being the other way around; he says that Maria cooked meals for both Mike and Rosa. The evidence of Tony as given in his cross examinations was largely inconsistent and does not appear to be credible.

[51] Bearing this in mind, the evidence of Margaret is particularly important in all of this; she had no interest in upholding the arrangement for the sale of the home to Rosa other than to carry out her mother’s wishes; it is apparent that, she, along with the other beneficiaries, will suffer a monetary loss by doing so. Moreover, she admitted for the purposes of argument of this motion that the agreement had not been signed by her and Nick when Tony repudiated the Agreement notwithstanding several fully signed copies being provided to the forensic document examiner; that is an admission against the position propounded by the estate and speaks to the credibility of her evidence. I furthermore do not find the inconsistencies in her evidence that are scattered throughout Tony’s evidence. Accordingly, apart from Mike’s evidence (and he does have an obvious monetary interest in this issue), where Tony’s evidence is in conflict with that of Margaret, I find that Margaret’s evidence is the more credible evidence and is to be given more weight than that of Tony.

[52] Finally, apart from the findings as to weight and credibility, Mr. D'Ambrosio has also noted s. 13 of the Evidence Act[^2] which reads as follows:

13. In an action by or against the heirs, next of kin, executors, administrators or assigns of a deceased person, an opposite or interested party shall not obtain a verdict, judgment or decision on his or her own evidence in respect of any matter occurring before the death of the deceased person, unless such evidence is corroborated by some other material evidence.

[53] Tony’s evidence is without corroboration. His evidence comes from his mouth and his mouth alone. Margaret’s evidence as to the arrangement to purchase the property and her mother’s wishes is corroborated by Mike’s affidavit; it is also corroborated by a number of documents filed in this proceeding, especially respecting the alleged loan by Maria to Tony.

[54] In making my determinations as to the facts of this matter, I am going to discount Mike’s evidence, and in particular his evidence regarding the events surrounding the signing of the Agreement due to his interest in the result of this motion. I am accordingly making the findings of fact herein based largely upon the competing evidence of Margaret and Tony. Based upon my assessment that I prefer Margaret’s evidence over that of Tony, and for the purposes of this motion, I am prepared to make the following findings of fact:

(a) Tony is a sophisticated businessman, and has signed numerous contracts in the course of his business affairs, often without obtaining legal advice.

(b) The Agreement was drafted pursuant to an arrangement which pre-dated the death of Maria wherein she had expressed her wish to have the property at 40 Palmer Avenue, Richmond Hill, Ontario, to Rosa for the original purchase price paid by her; that promise was in exchange for care giving provided to her for the ten years prior to Maria’s death.

(c) Prior to Maria’s death, all of the beneficiaries, including Tony, were well aware of her intention that the 40 Palmer Avenue property be so transferred to Rosa.

(d) After Maria’s death, the executors had the estate solicitors draft an agreement reflecting this arrangement and enabling Rosa to purchase 40 Palmer Avenue from the estate. All of the beneficiaries including Tony met to discuss the terms of the Agreement and came to an oral agreement as to the terms of the Agreement.

(e) The terms of the Agreement including the distribution of the estate assets as set out on p. 3 of the Agreement reflected the consensus arrived at between the beneficiaries at that meeting.

(f) Tony signed the Agreement and when he signed it all of the pages were attached to the signing pages of the agreement.

(g) There was a $75,000 loan from Maria to Tony which remained outstanding on the date of her death and that loan was reflected in the terms of her will and in the distribution of estate funds as set out in the Agreement, which Tony was aware of at the time he signed the Agreement.

[55] Based upon these findings of fact, I am now going to examine the legal issues concerning the validity of the Agreement raised by counsel.

LEGAL ISSUES

[56] The primary issue raised by Tony is the fact that the Agreement was not signed by either Nick or Margaret prior to his repudiation of that document. He notes that the Agreement was signed by only three beneficiaries (himself, Rosa and Franco) and not by the Estate Trustees. He states that without those signatures, the Agreement is not binding and he was entitled to repudiate the Agreement at any time prior to it being signed by all of the parties to it.

[57] Margaret admits that neither she nor Nick had signed the Agreement when Tony repudiated it after seeing the estate solicitor and reviewing the will in September or October of 2010. That she and Nick eventually did sign the Agreement is confirmed by the evidence of Mr. Ospreay, who noted that the two copies of the Agreement provided to him were fully executed.

[58] Apart from the issue that the Agreement was tendered on the beneficiaries by Maria’s estate and accordingly may have been binding upon the estate once signed by the other beneficiaries, the issue is whether the Agreement had to be signed by all parties to be binding, or whether the Agreement was enforceable notwithstanding the failure of Nick and Margaret to sign prior to the date the Agreement was repudiated by Tony.

[59] I have already made a finding of an oral agreement between the beneficiaries to transfer the 40 Palmer Avenue property to Rosa for $270,000, and that to do so, each beneficiary had agreed to reduce their respective bequests to assist in permitting Rosa to purchase the property. I have also made a finding that the Agreement as drafted by the estate solicitor reflects the terms of this oral agreement which had been arrived at during the meeting between beneficiaries as set out in Margaret’s affidavit.

[60] That being said, the issue remains as to whether the formal agreement had to be signed by all of the parties in order for it to bind the beneficiaries and the estate.

[61] It is well understood that, once the essential elements of an agreement have been arrived at subject to the drafting of documents to implement the agreement, that agreement will generally be enforceable at law. This is notwithstanding the fact that the parties may not subsequently agree on the actual formal documents to be executed at a later date. As stated in Cellular Rental Systems Inc. v. Bell Mobility Cellular Inc., 1995 CarswellOnt 4182 (Gen. Div.) at para. 17, “[t]o establish the existence of a contract, the parties’ expression of agreement must demonstrate a mutual intention to create a legally binding relationship and contain agreement on all of its essential terms”. To establish this agreement, it need not be in writing; as set out in Bawitko Investments Ltd. v. Kernal Popcorn Ltd. (1991), 1991 CanLII 2734 (ON CA), 79 D.L.R. (4th) 97 (Ont. C.A.) cited by Chapnik J. in Cellular Rental Systems, supra at para. 19, “[t]heir agreement may be expressed orally or by memorandum, by exchange of correspondence or other informal writings.” All that is required is that the agreement be proven, and that the parties had agreed to all of the essential elements of that agreement for a court to enforce it.

[62] In Borkofsky v. Lungal, 2010 CarswellMan 39 (Q.B.), Midwinter J. examined an offer to settle accepted by a handwritten note from the Defendant stating, “I am okay with the deal of the monies” but leaving unsettled the disposition of certain chattels left on the rented premises. There was a dispute over whether the Plaintiff had properly removed certain items from the premises and the Plaintiff subsequently stated that there was no enforceable settlement as a result.

[63] Based upon Norwich Union Life Insurance Co. (Canada) v. MGM Maintenance Group Inc., [2003] M.J. No. 451, which summarized the ratio from Cellular Rental Systems, supra, Midwinter J. set out the criteria in that case to determine whether an agreement is enforceable:

24 Norwich Union, a decision of McCawley, J., sets out at paragraph 18 a review of Cellular Rental Systems Inc. v. Bell Mobility Cellular Inc., [1995] O.J. No. 721, from the Ontario General Division to determine the law relevant to such a case as this which is as follows:

1. An agreement to settle a claim is a contract;

2. To establish the existence of a contract, the parties' expression of agreement must demonstrate a mutual intention to create a legally binding relationship and contain agreement on all of its essential terms;

3. Where the parties agree on all the essential provisions to be incorporated in a formal document with the intention that their agreement shall be binding they will have fulfilled the requisites for the formation of a contract. The fact that a formal written document needs to be prepared and executed does not alter the binding validity of the original contract;

4. Where the essential provisions intended to govern a contractual relationship have not been settled or agreed upon the original or preliminary agreement does not constitute an enforceable contract;

5. In considering whether certain terms of the settlement were implied the court will look at the settlement discussions and the documentation and correspondence in the context of normal business practice and common sense;

6. No party is bound to execute a document to effect the settlement agreement which contains terms or conditions which have not been agreed upon and are not reasonably implied in the circumstances.

[64] As we are not dealing with the settlement of a claim (although it might be seen as a settlement considering the fact that there is a contemplated action in quantum meruit should the agreement not be upheld), only para. 2 to 6 set out above are relevant to the issues in this case. Regarding those criteria, I would firstly note that, according to Margaret, the beneficiaries of the estate met and came to an agreement to permit the transfer of the property to Rosa; that apparently was an oral agreement between the parties. That agreement was to address the transfer of the property to Rosa as well as the fact that Rosa did not have sufficient funds to purchase the property; accordingly the proposal was that each party reduce their bequest in order to permit Rosa to purchase the property. In fact, according to Margaret, Tony stated that “Rosa could have all of his share of our mother’s estate for all the care and support that she provided for our mother.” The essential terms of the agreement were that the property would be transferred to Rosa for $270,000; the respective shares of the estate beneficiaries other than Rosa would be reduced to enable this, and that a collateral mortgage for $61,000 would be registered to protect the estate. These were, according to Margaret, in place at the termination of the meeting; in fact, it appears from the evidence of Margaret (although not specifically stated) that the draft agreement as prepared by Gray & Associates had already been prepared when the parties met.

[65] At the end of the meeting in question, it is apparent that the parties intended the agreement to be binding. That Margaret and Nick had five copies prepared for execution is evidence of that, as are the signatures on the Agreement of Tony, Rosa and Franco. Other than Tony’s evidence, there is no evidence that the essential terms of the agreement had not been agreed upon. In essence, the evidence is that the parties had agreed on the purchase price of the property, the reduction in the estate bequests by each beneficiary as well as the collateral mortgage back to the estate.

[66] There is no issue of implied terms to be included in the Agreement; in effect, the sole conflict on the evidence as to whether there was any agreement or not.

[67] Mr. Trudelle attempts to distinguish these cases from the present facts due to the fact that they were settlements of litigation claims which were both in writing and governed by the Rules applicable in their various jurisdictions. That is, however, not a distinguishing feature. As noted in Norwich Union, the initial issue is whether there is an agreement; the first criterion from that case is that the settlement of a claim is a contract and once that is determined the other criteria apply. Accordingly, one way or another, I must find an agreement between the parties which contained all of the essentials of the agreement in question; once done, it is binding and enforceable. The fact that these were claims which arose out of settlements of actions is not a distinguishing factor.

[68] Moreover, I note that the agreement was tendered by the estate to the beneficiaries, and that, other than the Estate Trustees, all of the remaining beneficiaries had signed the agreement. Mr. Trudelle on behalf of Tony, stated that because of this, the estate could have backed out of the agreement at any time based upon the failure of Margaret and Nick to sign. I believe, however, that the contrary is true. Based upon the fact that the estate had provided the agreement to the beneficiaries for execution, the fact that the Estate Trustees had not signed could not be used by the estate to back out of the Agreement; were there no agreement arrived at in the beneficiaries’ meeting, the Agreement was effectively an offer that was tendered on the remaining beneficiaries by the Nick and Margaret as Estate Trustees and would be binding on the estate once those beneficiaries had accepted it. If it was then binding on the estate, then the question must be asked as to why it is not binding on Tony who had already signed the Agreement and accepted the offer tendered on him by the estate.

[69] Accordingly, I find that there was an agreement made at the meeting of beneficiaries that was reflected in the Agreement as drafted by Gray & Associates and which was signed by Tony, Rosa and Franco on August 2, 2010.

[70] Tony, however, has raised the issue of s. 4 of the Statute of Frauds[^3] which reads as follows:

4. No action shall be brought to charge any executor or administrator upon any special promise to answer damages out of the executor's or administrator's own estate, or to charge any person upon any special promise to answer for the debt, default or miscarriage of any other person, or to charge any person upon any contract or sale of lands, tenements or hereditaments, or any interest in or concerning them, unless the agreement upon which the action is brought, or some memorandum or note thereof is in writing and signed by the party to be charged therewith or some person thereunto lawfully authorized by the party.

[71] The easy answer to this is the fact that the Statute does not require all parties to have executed the agreement; it requires the signature of the “party to be charged therewith” to make the agreement enforceable against that party. Here, the only party being “charged therewith” and seeking to set aside the Agreement or dispute its enforceability is Tony and he signed the Agreement. The Statute of Frauds is of no application in this matter.

[72] Tony raises, however, his failure to obtain independent legal advice as a reason why the Agreement should be set aside and not binding upon him. Mr. Trudelle notes that the Agreement requires, not suggests, independent legal advice; it states that Gray & Associates acts solely for the estate of Maria and that “Rosa, Antonio Lagani and Franco Lagani shall receive Independent Legal Advice for [the Agreement] and that Gray & Associates is not representing the interests of Rosa, Antonio or Franco.” Tony argues that the requirement of independent legal advice was mandatory under the Agreement, and without independent legal advice, the agreement is of no effect.

[73] In fact, none of the mentioned parties obtained independent legal advice respecting the agreement. Rosa certainly did not; although she had retained counsel to complete the transaction, that was covered in a separate paragraph on p. 3 of the agreement and was for real estate conveyancing purposes only. There is no evidence that Franco obtained a lawyer prior to signing the Agreement. Tony also did not obtain advice from his own lawyer; his evidence was that he eventually went to speak with someone from Gray & Associates, who were the estate solicitors and who were specifically stated in the Agreement to be acting for the estate and not the beneficiaries. He asked for a copy of the will and the lawyer had to obtain the consent of the estate to show it to him; he had to come back to see that lawyer a second time. He never obtained independent advice about the agreement or the effect of the agreement; he also did not state in any of his material that he did not understand the agreement. All that he initially stated was that he was not given the Agreement and when he saw the will, he repudiated the arrangement based upon the fact that he thought that it was reflected in the will when it was not.

[74] Counsel was unable to provide me with any cases wherein an agreement was conditional on a party obtaining independent legal advice. Generally such clauses are not seen as conditions precedent or subsequent, the failure of which would avoid the agreement. Usually, such clauses are inserted due to the concerns of counsel preparing the agreement of perception of a conflict, as well as ensuring the enforceability of an agreement where parties are signing without counsel. They are intended to call to a party’s attention that the agreement affects legal rights, and that a party signing the agreement without consulting with counsel does so at their peril. Where the clause has been inserted for the benefit of the proponent of the agreement, that party may insist upon the responding party obtaining independent legal advice by refusing to proceed with the transaction; by going ahead without a certificate of independent legal advice, that party effectively waives that requirement as he or she is entitled to: see Duca Community Credit Union Ltd. v. Fulco Automotive Ltd., 2002 CarswellOnt 5350 (S.C.J.) as aff’d by 2003 CarswellOnt 2315 (C.A.).

[75] In this case, I do not find that the agreement was conditional upon the Applicant obtaining independent legal advice as set out in the agreement. It is apparent to me from a reading of the entire clause that it is meant to protect the estate as well as the estate solicitors; in the first clause of the paragraph requiring independent legal advice, the Agreement states that the agreement is prepared by Gray & Associates based upon instructions received from the estate. The clause is intended to make it clear that Gray & Associates is not acting for any other party and did not provide advice to the other parties to the agreement. The agreement imposes an obligation on the beneficiaries to obtain independent legal advice prior to execution; they did not. Tony cannot rely upon his failure to comply with this provision to now repudiate the agreement.

[76] Moreover, Tony has not demonstrated where independent legal advice may have made a difference to him in this matter. He is a sophisticated businessman. He has signed numerous contracts and his cross examination makes it apparent that he knew when it was necessary to obtain advice about an agreement from his lawyer and when it was not. Based upon his evidence, it is difficult to understand what he did or did not understand, as he denied throughout, until the receipt of the forensic evidence, that he even saw the agreement until filed in these proceedings. However, he never states that he did not understand the nature of the agreement; he says that he eventually repudiated the agreement because he discovered that the will did not set out the arrangement for the purchase of 40 Palmer Avenue by Rosa. It is difficult for him to confirm his understanding of the agreement when it was signed insofar as he denied until argument of the motion having had it in hand when he signed it on August 2, 2010.

[77] Tony’s claim in non est factum arises from the fact that he states that he did not have the agreement in hand when he signed it; were he even to rely upon that doctrine, he, as a sophisticated businessman, would have a difficult time in making this out: see Adera Financial Corp. Ltd. v. Pan Asia Investment Inc. (1984) B.C.L.R. 50 (C.A.) as quoted in Van Der Ros v. Van Der Ros (2003), 2003 BCCA 270, 12 B.C.L.R. (4th) 307 (C.A.) at para. 10:

...the principle of non est factum could only rarely be established by a person of full capacity, and although it is not confined to the blind and illiterate, any extension of the ... [scope] of the plea must be kept within narrow limits; and in particular it is unlikely that the plea would be available to a person who signed a document without informing himself of ... [the] meaning.

[78] It is apparent from this quote that the plea of non est factum is not generally available to a sophisticated businessman who did not read the agreement when presented to him. Tony, if he chose not to read the agreement (and again, this is unclear as Tony gave no evidence in this regard as he did not admit in the materials to having the Agreement in hand when he signed it) would not have recourse to an argument that he did not understand the agreement as he had a duty to inform himself of the contents of the Agreement. He had also signed numerous agreements in the past and knew that any signed agreement would have the potential of affecting his legal rights.

[79] Mr. Trudelle states, however, that the reason he did not read the Agreement was because misrepresentations were made by Mike at the time Tony signed the Agreement. He notes that an agreement may be set aside where signed based upon a material misrepresentation: see Petro-Quip International Inc. v. Kala Naft Canada Ltd., 2006 CanLII 19497 (Ont. S.C.J.). Tony stated in his affidavit that he signed the documentation because he was told by Mike that the will provided for the transfer of the 40 Palmer Avenue property to Rosa and as such, he did not feel the need to inquire further into what he was signing. He stated in examinations that “I trusted my sister completely” and he stated that her statement that the purchase arrangement was in the will mislead him into signing the Agreement.

[80] I firstly again have serious concerns about the inconsistencies in the evidence as given by Tony. He states that he trusts his sister “completely” but earlier in the examination, he refers to the fact that the same sister had “screwed” his mother through the care giving arrangement. He also states earlier in his cross examination at Q. 265 that his sister was not present when he signed the Agreement; she could hardly have represented something about the will to Tony when he signed the Agreement when his evidence was that she was not then present.

[81] However, even if telling the truth, the fact that he trusted Rosa does not excuse him from his duty to read the agreement and understand to the best of his ability what he is signing. As stated in Toronto-Dominion Bank v. San-Ric Developments Ltd. (1987), 1987 CanLII 2701 (BC SC), 11 B.C.L.R. (2d) 260 (S.C.) respecting a husband and wife relationship as cited in Van Der Ros, supra again at para. 10,

I do not consider that in this day and age, a woman of adult years and understanding who is literate, can avoid the consequences of her executing an instrument by saying "I relied completely on my husband. Such reliance is not careless."

[82] In my view the same dictum would apply to a close family relationship such as his relationship with his sister as described by Tony; if Tony is to sign an agreement which may affect his legal rights, he is not excused from reading it or taking due care in satisfying himself as to its contents because of his special relationship with his sister.

[83] Moreover, I have also made a finding that the terms of the Agreement had been discussed and agreed to at the previous family meeting as set out in the affidavit of Margaret. Based upon this finding, no misrepresentation could have been made which vitiated the Agreement as I have determined that the issue had been discussed and agreed to between the parties prior to the copies being presented to Tony for execution.

[84] As such, I find that the Agreement is valid and binding in this matter, and a declaration will go as requested in para. 1 of the Respondent’s Notice of Motion.

Should the Estate Trustees be compelled to sell the property located at 40 Palmer Avenue, Richmond Hill, Ontario?

[85] The answer to this question is obviated by my determination as to the validity of the Agreement. As a valid agreement is in place requiring the estate to convey the 40 Palmer Avenue property to Rosa, a sale of the property would be contrary to that Agreement and should not be ordered.

[86] Even if the Agreement was found to be void or voidable based upon the arguments of Tony, there would clearly be further litigation brought by Rosa in quantum meruit for the care she provided her mother for the past ten years. As such a sale of the property would be inappropriate in any event as it would pre-determine the results of that litigation.

[87] The Applicant’s motion for the sale of the property is dismissed.

Should the Estate Trustees be compelled to produce a list of the assets of the estate as required under the order of Sosna J. dated May 12, 2011?

[88] As noted above, on May 12, 2011, on consent, Sosna J. made an order for directions in the conduct of the estate litigation commenced by the Applicant to set aside the wills of Maria made in 2006 and 2009. Paragraph 9 of that order provided that a written statement as to estate assets on the date of Maria’s death and verified by affidavit would be provided by the estate to the solicitor for Tony within 45 days. Tony states that his lawyer wrote to Mr. D'Ambrosio on September 15, 2011 requesting compliance with para. 9 of the order of Sosna J. by “provision of a written statement verified by sworn affidavit setting out all of the assets owned by the deceased at the time of her death.” The affidavit of Tony sworn October 19, 2011 states that at the time of the swearing of that affidavit, para. 9 of the order remained in default.

[89] Margaret failed to address this issue in her affidavit sworn October 26, 2011. She did, however, speak to it during her cross examinations in this matter. She states that she thought that she had provided an estate inventory but she was not sure at that time whether she had. She gave an undertaking to advise as to her compliance with this paragraph. Neither party provided the results of that undertaking at the argument of the motion. Although Mr. Trudelle acknowledged receiving an affidavit from Margaret dated February 1, 2012, he stated that it was deficient and that he required a further and better affidavit. No evidence was tendered as to exactly what was provided and where the deficiencies lay.

[90] My difficulty with the Applicant’s motion for disclosure is that his request is for me to repeat para. 9 of the order of Sosna J. If I order the inventory and affidavit to be served forthwith, I am only going to be ordering what was already ordered and which order, if the inventory is not yet produced, is now in default. An order of the nature requested does nothing other than “gild the lily” and serves no useful purpose. The Applicant has his remedies under the Rules and in contempt in the event of a breach of an interim order and he has not requested any of these remedies. The motion of the Applicant for a further order that the material be provided forthwith is dismissed without prejudice to request remedies resulting from any default in para. 9 of the Sosna J. order, if any.

ORDER

[91] Accordingly, there shall be an order to go in accordance with para. 1 of the Respondents’ Notice of Motion. The Applicant’s motion for sale of the property and production is dismissed without prejudice to request default remedies as appropriate should the production order remain in default.

[92] The Respondents shall have their costs of this motion to be set off against the bequest owing to Tony. If the parties cannot agree to the quantum of costs, they may make arrangements through the trial coordinator to speak to the issue of costs at a convenient date.

McDermot, J.

Date: May 4, 2012

[^1]: R.R.O. 1990, Reg. 194 [^2]: R.S.O. 1990, c. E.23 [^3]: R.S.O. 1990, c. S.19