COURT FILE NO.: 01-2011/11
DATE: 20130919
ONTARIO
SUPERIOR COURT OF JUSTICE
IN THE ESTATE OF FILIPPO VIRDO, deceased
BETWEEN:
ONOFRIO VIRDO,
Applicant
– and –
ANNA VIRDO, MADDALENA FALLICO and DOMENIC VIRDO,
Respondents
Counsel:
Jacques P. Gauthier and Micheal G. Simaan, Co-Counsel for the Applicant
Anna Virdo, Unrepresented
Maddalena Fallico, Unrepresented
Peter Grunwald, Counsel for Domenic Virdo
HEARD: SEPTEMBER 11, 2013
ENDORSEMENT: GREER j.:
[1] Filippo Virdo (“the deceased”) died on May 29, 2008, naming his 4 children as Co-Estate Trustees of his Estate. The Estate was an outright distribution to those children, Onofrio Virdo (“Onofrio”) and Anna Virdo (“Anna”), who in some documents is sometimes referred to as “Anna Messina”, and Maddalena Fallico (“Maddalena”) and Domenic Virdo (“Domenic”). Onofrio is the Applicant in this proceeding and the others are the Respondents. For simplicity’s sake, I shall refer to each of them by their first names.
[2] Today, 5 years and 4 months later, the Estate remains unadministered. At common law, Estate Trustees have one year from the date of the deceased’s death to administer the estate, if it is an outright distribution with no complications. In this case, the only complication is that the 4 children cannot agree on the sale of the deceased’s home at 227 Albany Avenue, Toronto (“the home”).
[3] On May 9, 2013, the parties appeared before Mr. Justice Morgan. At that point in the proceeding, Anna was presented by counsel. The parties appeared earlier in Court because there was an issue among them as to what should be done with the home. Anna and her family had been occupying it for nearly 4 years without paying occupation rent. Onofrio and Domenic both agreed that there was no need for any further delay in listing the house for sale. Anna and Maddalena wanted to delay the Listing and wait until the Trial of all issues took place. In his Endorsement of May 9, 2013, Mr. Justice Morgan says:
Anna (or any of the other parties) has the right to make an offer at any time –either before, or during the listing. The parties agree that Sutton Group Associates Realty Inc. is a competent local agent that should be the listing agent. Her advice should be followed in terms of a listing price and an approach to marketing. Anna will have 2 weeks from today to make an offer to purchase before it is listed. All parties are to strive to achieve market value of the property. Anna has a right to buy it at market value and any offer that she makes must be considered in good faith by the other parties.
[4] On June 8, 2013, the parties again appeared before Mr. Justice Morgan, who gave an Order for Directions with respect to the administration of the Estate. He ordered the Trial of certain issues to take place and that a mediation take place. If the mediation failed, the Applicant was to issue a Statement of Claim. That had not been done since one of the parties’ counsel (no longer now representing that beneficiary) would not co-operate in approving the draft Order sent to him for approval. Given that difficulty, I have extended the time for such Statement of Claim to be issued to 30 days after his Order is issued and entered. I then reviewed and approved the draft Order so counsel would be able to have it issued and entered.
[5] The listing of the home did take place with Sutton Group Associates Realty Inc. (“Sutton”). Sutton suggested that the listing price be $949,000. The listing date was not to be entered into was to be delayed for 2 weeks after the Order was made. During that period, Anna made no Offer to purchase the home, nor did any of the other children. All 4 parties eventually signed the Agreement.
[6] The parties are now before me because the home was not sold in the interval between listing and now, due to Anna’s intransigent behaviour over the sale. The evidence before me shows where she consistently interfered with the showings and failed to co-operate even when Offers came in over the asking price.
[7] Onofrio says that from the very beginning, Anna has refused to properly co-operate in moving the sale forward. The Listing Agreement was sent out on May 21, 2013. Onofrio and Domenic signed on May 24. On May 28, the agent sent an e-mail saying that she could only hold the Listing for 2 days for the rest of the signatures. Maddalena said she would sign it on the 29th. There was a Seller’s Direction that there be no showings until June 5, 2013, the Listing is valid until September 27, 2013.
[8] Anna did sign the Listing on May 29 but instructed the agent not to process it for 24 hours, “because of her wish to communicate with her lawyer.” This was the first step in the process whereby Anna began delaying the sale and being un-co-operative with the agent. By June 1, 2013, the agent advised the parties by e-mail that “some buyers are very uncomfortable viewing a property when the seller is home.” After a week, the agent told the parties that she was receiving some lower Offers because, “The overwhelming feedback was that the house needed too much work, shows very poorly and smells badly of cats.”
[9] The agent brought in 2 initial Offers that were signed back by Onofrio and Domenic but not Anna and Maddalena. The agent wrote that Anna “…will not sign the offers and she wishes to cancel the listing.” The evidence in the e-mail of the agent dated June 8 is that Anna then started to refuse requests for showing the property and would not answer calls to confirm the showings. Her voicemail was often full. A sign-back on an Offer for $950,000 was signed by Onofrio and Domenic but not Anna. Maddalena signed it minutes before the Offer expired. On June 11, the agent said that before she moved forward, after “another long session of abuse” by Anna, that other agents told her that the property needed a lot of work, and that it shows poorly. They said it continues to smell badly of cats and that cats follow the buyer’s everywhere when they view it. The agent recommended that Anna and her family and cats vacate the property so that Sutton could get a proper open house organized.
[10] On June 18, a new Offer at $960,000 came in and again, Onofrio and Domenic immediately signed it, Maddalena delayed but eventually signed it and Anna did not sign it. The agent was so frustrated by this that she asked Anna whether a clean Offer of $970,000 would satisfy her and Anna said “No.” An Offer came in at that price and it was again lost. By July 11, the agent had booked 69 showings with 18 showings being refused or cancelled by Anna. The agent finally advised that the Listing should be suspended, given Anna’s behaviour.
Onofrio’s position
[11] Onofrio asks the Court to remove Anna and Maddalena from being part of the sale process of the home. He feels that Maddalena has neglected her role by having her husband, Lou, take part in the process of communicating with the agent and with Onofrio and Domenic. Anna, he says, has obstructed the whole process while she and her family continue to live in the home rent-free. Even though Anna agreed to pay certain expenses of the home when she moved in, the real property tax arrears as of August 13, 2013 for the years 2012 and 2013, are $14,932.14, with an additional amount of $1,937.42 owing by September 3. If for no other reason, this debt means that the property must be sold immediately.
[12] In his Factum, Onofrio also asks that Anna be removed as an Estate Trustee. He says that the Estate must take vacant possession of the house immediately so that it can be sold. He says that Maddalena must be removed from the sale process, even though he is aware that eventually, at the last minute, Maddalena co-operates. He says her constant support of Anna makes it difficult to work with her. Finally, he says Maddalena has delegated her duties as an Estate Trustee to her husband, Leo, which a Trustee cannot do.
[13] Onofrio is agreeable to working with Domenic on the sale of the home and making it presentable for prospective buyers.
Domenic’s position
[14] Domenic agrees with Onofrio that Maddalena has been supporting Anna in her occupation of the home without the payment of rent. He is aware that Onofrio is “…vehemently opposed to this state of affairs,” and has been insistent in the move to sell the home. Domenic says that he initially agreed to Anna moving into the home when she was having financial difficulties but only supported that position for “a few months,” thinking that the father’s Estate would be settled during that period.
[15] Domenic acknowledges that the 4 siblings could not agree on anything. He agrees with Onofrio’s evidence about the problems that the two of them had in trying to work with the agent, because of the positions taken by the 2 sisters. He says that Anna and her family are not tenants of the home and simply occupy it “on sufferance.” None of them, he says, should be able to block the sale. He thinks Maddalena would be agreeable to accepting a reasonable Offer.
[16] Domenic would like the Court to order Anna to sign what the others consider to be an acceptable Offer or if there is a disagreement by either him or Onofrio or Maddalena, that the Court order that a majority of the three signing the Offer is acceptable. He suggests that if an Offer comes in under the Listing price, that all four of the siblings be allowed to discuss the Offer. If an unconditional Offer in excess of the purchase price comes in, then Domenic wants the Court to order the sisters to sign it, as he and Onofrio would sign such as Offer. In the alternative, he asks the Court to order all 4 to sign every other document, if there are “roadblocks” put up by anyone for a sale.
Maddalena’s position
[17] Maddalena is unrepresented by counsel. In her submissions to the Court, she was very passionate about having to lose the old family home on a sale. She says that she believes that her late father would not want his children to sell the home under duress, when one of his children wanted to buy it.
[18] Maddalena says she has read Anna’s Responding Motion Record and “…am in agreement with everything that she has said.” She says that she has been trying to purchase the house for two years and after numerous attempts has been unable to do so. She says she obtained three different appraisals and that she offered to pay the median price but that it was rejected by Onofrio.
[19] Maddalena believes she has fulfilled her duties as an Estate Trustee, saying that she does not do e-mail and requires the help of her husband to answer e-mail inquiries.
Anna’s position
[20] Anna is now unrepresented by counsel although she had counsel at the other two Court proceedings before Mr. Justice Campbell, K. and Mr. Justice Morgan. Anna’s Responding Motion Record on this Motion is 197 pages in length, 36 of which form her Affidavit. She also filed a Supplementary Motion Record. Anna takes the astonishing position that she has done nothing wrong and has paid all the expenses in operating the home, including the property taxes, despite independent evidence to the contrary.
[21] Anna blames Onofrio for creating all the problems with the house. She wants Maddalena to be able to purchase the home, even though Maddalena and her family would not be living there. Anna knows that Maddalena would continue to either let her and her family continue to live there or they would lease it from her. She says Maddalena’s Offer to purchase the home is “fair”.
[22] Anna’s Affidavit is a constant criticism of Onofrio. She talks about all of the appraisals that were done early on after the father’s death and how Onofrio “mislead” everyone. She says in her Supplementary Affidavit on this Motion, that Domenic’s Affidavit is “wrong and misleading…and should be ignored in its entirety.” She claims that his evidence about how Maddalena has supported Anna living in the property rent-free is a “falsehood”, as she agreed to pay expenses. She says that Domenic agreed she did not have to pay rent.
[23] Throughout this Affidavit, Anna uses such inflammatory and untruthful words such as Domenic’s statements in his Affidavit before Mr. Justice Morgan was “misleading information” and how Domenic has “wilfully ignored Ono’s refusal to sell the house to his sister for the last two years.” She speaks of a “bogus Offer” that someone known to Onofrio presented to the Estate early on after the father’s death. She finds Domenic’s behaviour “shameful” and says Onofrio’s behaviour is “deceitful”.
Analysis
[24] I order that Anna be removed as an Estate Trustee of the Estate of Filippo Virdo for the reasons that follow. I order her to vacate the home within 30 days of this Order. The remaining Estate Trustees shall have sole signing authority on a new Listing Agreement for the sale of the home and sole signing authority on the acceptance of any Offer to Purchase they agree is reasonable from an independent arm’s length purchaser, and the signing of any documents to complete the purchase and sale.
[25] The evidence is clear that Anna has obstructed the proper administration of the Estate, favouring her own self interest in continuing to live rent-free in the house. She has no understanding that all Estate Trustees must act in the best interests of the Estate. The Will of her late father directs an outright distribution to the beneficiaries, which means an outright sale of the home unless all parties agree otherwise.
[26] The Estate had a duty to rent the premises out to a neutral party during the litigation if Anna was not going to pay fair market rent for the property. Agreeing to simply pay for the expenses that she and her family were using such as heat, light, water, telephone and cable, is not sufficient. Even though Anna agreed to also pay the property taxes and insurance, this is still not sufficient for anything but a short-term solution if no other tenants could be found.
[27] Anna, however, did not pay all the property taxes over her period of occupation and there is no evidence that the insurance on the home is up-to-date. Since all of the Estate Trustees (or in their capacity as beneficiaries) do not agree to let Anna remain in the home, she must vacate the property as I have ordered her to.
[28] Anna refused to co-operate on the sale of the home, other than signing the Listing Agreement. The clear evidence of the agent, as set out in this Endorsement, is reason enough for the removal of Anna as an Estate Trustee, pursuant to S.37 of the Trustee Act R.S.O. 1990, c.T.23, as am. S.O. 1992, c.32, s.27. While the proceeding before me was not a separate Application to remove Anna as an Estate Trustee, and was brought as part of a Motion proceeding before me, the Court has the residuary authority to remove Anna. Although an Order removing a trustee will not ordinarily be made ex parte, it may be so made when the assets are “in immediate danger.” See: Probate Practice 4th ed, R. Hull Q.C. and Ian Hull, p.163. In this case, Anna was on notice that Onofrio was moving for this relief and she chose to ignore it.
[29] In Evans v. Gonder, 2010 ONCA 172, 2010 CarswellOnt 1240 (C.A.) a vacant house was subject to a tax lien. In that instant, the Court looked at the behaviour of an Estate Trustee which impeded “anything meaningful” since the lack of agreement made them unable from selling the house. The Motions Judge removed both Trustees but did not put a plan in place to have the administration completed. The Court of Appeal said it could not leave the Estate without an administrator, so it upheld the appeal. That is not the case before me.
[30] In Evans, supra, the Court, however, points out that the role of a trustee is such that he or she must act in the best interests of the beneficiaries, even at personal hardship. Anna has never acted in the best interests of all the beneficiaries, as is noted by the agent. In addition, Anna’s vitriolic dislike of her brothers, as expressed in the words of her Affidavits, in my view, makes it impossible for Anna to continue to act as an Estate Trustee.
[31] Onofrio had no alternative but to bring on this Application when the impasse among the beneficiaries continued year after year. There is a need for a timely resolution of the sale of the home. In paragraph 26 of Evans, supra, the court notes that our courts have long recognized an inherent power to remove a trustee when circumstances require. In my view, the circumstances are such, that Anna’s total lack of co-operation once the Listing was in place, makes it clear that she cannot act in concert with them.
[32] Given that the property has vested in the 4 beneficiaries after 5 years of not being administered, unless some Caution was registered on title, I order that the signature of Anna on any document respecting the sale of the house, is dispensed with, even though she may be a beneficial owner of ¼ of the property.
[33] An Estate Trustee may not buy an estate asset unless all beneficiaries agree or without a Court Order. Since neither Anna nor Maddalena gave the Estate an Offer to Purchase in the form of an Agreement of Purchase and Sale within the two week period offered by Mr. Justice Morgan, the Listing took place. While Maddalena was hesitant in signing any documents presented to her, she did so in the end. Maddalena shall remain as an Estate Trustee and if she fails to sign a reasonable Offer to Purchase without conditions and for a price agreeable to Onofrio and Domenic, within 2 days of being presented with the Offer, Onofrio and Domenic may move before the Court, ex parte, to have her signature dispensed with. Maddalena shall co-operate in signing all documents in a timely manner to effect a reasonable sale of the home.
[34] Since Anna has signed a document to suspend the current Listing, an Order shall go cancelling the current Listing. The remaining Trustees shall re-list the home for sale with Sutton on the same or new terms as may be agreeable to the remaining Trustees.
[35] A Writ of Possession shall issue with respect to Anna and her family vacating the home. I order the Sheriff not to act upon it until 30 days from the date of this Order, to give Anna and her family the time to vacate, failing which, it may be acted upon on the 31st day following this Order.
[36] The balance of the Orders of Mr. Justice Campbell, K. and Mr. Justice Whitaker shall continue to be in force with respect to other issues in the administration.
[37] It is the position of Onofrio and Domenic that Anna should be ordered to pay the Costs of this Motion. They shall submit Written Submissions to me no longer than 3 pages in length plus time dockets and any case law on the issue of Costs, within 30 days of this Order. The Submissions shall be served on Anna, and she shall have 10 days within which to respond in writing to the Submissions, with Onofrio and Domenic having 10 days thereafter to Reply, if necessary. All Submissions shall be sent to me at Osgoode Hall.
Greer J.
Released: September 19, 2013
COURT FILE NO.: 01-2011/11
DATE: 20130913
ONTARIO
SUPERIOR COURT OF JUSTICE
IN THE ESTATE OF FILIPPO VIRDO, deceased
BETWEEN:
ONOFRIO VIRDO,
Applicant
– and –
ANNA VIRDO, MADDALENA FALLICO and DOMENIC VIRDO,
Respondents
ENDORSEMENT
Greer J.
Released: September 19, 2013