COURT FILE NO.: ES-997-12
DATE: 2014-04-16
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Myrna Winnifred Vitale
Applicant
– and –
Joanne Martin, Estate Trustee of the Estate of Salvatore Vitale and in her Personal capacity, Filippo Vitale and Giuseppina Vitale
Respondents
A. Saji, for the Applicant
Joanne Martin, Estate Trustee of the Estate of Salvatore Vitale and in her Personal Capacity, Self-represented Respondent
Filippo Vitale and Giuseppia Vitale, Self-represented Respondents
AND BETWEEN:
COURT FILE NO.: ES-726-12
Joanne Martin, as Estate Trustee of the Estate of Salvatore Vitale
Applicant
– and –
Myrna Winnifred Vitale, Lisa Howard, Christine Wigle, Michael Vitale, Michael Legere, Carole Cardoso, Fillippo Vitale Jr., Tyler Martin, Joshua Martin, Marcel Raymond Girard aka Marcal Raymond, Donnie Ellison, Filippo Vitale and Giuseppina Vitale
Respondents
IN THE MATTER OF THE ESTATE OF SALVATORE VITALE, deceased
Self-represented Applicant
A. Saji, for the Respondent, Myrna Winnifred Vitale
COURT FILE NO.: ES-698-13
J. Webster, for A. Saji
HEARD: February 18-21, 24-28, April 2 and 4, 2014
THE HONOURABLE MR. JUSTICE P.B. HAMBLY
REASONS FOR JUDGMENT
[1] Salvatore “Sam” Vitale committed suicide on May 2, 2012. He was married to Myrna Vitale ("Myrna"). He had been injured in an accident at his workplace in 1999.
[2] From about 2000, he resided substantially with his parents, Filippo Vitale and Giuseppina Vitale ("the parents"). There were two major assets in his estate – a house at 38 Chalmers Street in Cambridge, where he had lived with Myrna, and RSP’s and life insurance. The house was registered in his name.
[3] Myrna has continued to reside in the house. Sam was there as well at times. The amount of time that he spent there is in dispute. There is a tenant at the house who occupies part of it. He pays rent of $640 per month.
[4] There were two policies of life insurance - one in the approximate amount of $13,000, in which Sam named Myrna as beneficiary and one in the amount of approximately $32,000, in which he named his mother as beneficiary. He also had RSP’s and LIRA’s in the approximate amount of $116,000, in which he named his mother as beneficiary. About $148,000 was conveyed to his mother after his death consisting of RRSP’s, LIRA’s and the insurance proceeds. She deposited the money in a joint account with her husband.
[5] Sam had a will in which he named his sister Joanne Martin as estate trustee. There is the usual term in the will that all his assets vested in the trustee which are to be sold if necessary to pay debts. He also left some musical instruments to his brother, Fillippo Vitale Jr. He owned two rural properties – one in Flamborough, south of Cambridge and one in New York State. The value of these properties is in dispute. The estate sold the Flamborough property for about $16,000. There is an issue as to whether this property was sold at less than fair market value. It continues to own the property in New York State. He left these properties to named beneficiaries. The value of these properties is a maximum of $20,000 each and probably less. Subject to the general term permitting the sale of assets to pay debts, he left the house to Myrna and her children, who have renounced any interest in this bequest.
[6] Myrna felt that the will did not provide adequately for her needs. She brought an application for support under the Succession Law Reform Act. The estate brought an application for directions including an order for the sale of the house to pay debts. There were two major debts - the cost of a mausoleum purchased for Sam’s burial in the amount of approximately $26,000 and income tax as a result of the liquidation of the RSP’s and a deemed disposition on death of the house in the total amount of about $56,000. There is an issue as to whether these debts were properly incurred.
[7] These applications came before Justice Reilly on August 19, 2013. Ms. J. Sweatman represented Joanne Martin, Mr. A. Saji represented Myrna and Mr. F. Gazzola represented the parents. There were multiple conflicting affidavits filed by the parties on these applications. Justice Reilly found that he was unable to decide the motions before him on the basis of the affidavits. He ordered that the applications proceed to trial and that the estate trustee pass the accounts of the estate. All three matters came before me for trial commencing on February 18, 2014. Ms. Martin, Fillippo Vitale Jr. and the parents were self represented. Mr. Saji represented Myrna.
[8] Justice Reilly in his judgment dated September 19, 2013, reported at [2013] O.J. No. 4244 stated the following:
29 I have carefully considered the copious material, including the numerous affidavits submitted by the parties, together with the submissions of counsel. I am mindful that these are interim motions seeking temporary relief pending the careful consideration that a trial judge will have to apply to these sensitive and very contentious issues. I am mindful of the acrimonious relationship that exists and has existed between Myrna Vitale and at least some of the members of the family of Salvatore Vitale, her husband. Based upon the many contradictory affidavits that have been filed and the somewhat complex legal issues that have been raised, it is impossible for me to resolve these issues based upon the summary motions. They cry out for either a resolution by the parties or the determination by a trial judge. I would point out to the parties that while there is a significant financial amount involved in this litigation, a good portion thereof would be quickly consumed by several days of trial. I speak now of many unrecoverable costs. I would strongly encourage the parties to do their best to resolve this litigation if at all possible, failing which there will be a trial of these issues, most specifically Myrna Vitale's claim for dependant's relief and her claim against the "Section 72" funds. Pending resolution by agreement or trial of these issues, I direct as follows:
[9] The parties took Justice Reilly’s advice. They jointly retained James Bennett. He is a long experienced lawyer specializing in civil litigation and a highly regarded mediator and arbitrator. He charged the parties approximately $4,000, which they shared for a one day mediation on November 18, 2013. He recommended a settlement in which the essential terms were that Myrna pay a substantial amount to the estate to be obtained by her by remortgaging the house. The estate would convey the house to her. The parents would pay to the estate $56,000 from the $61,000 that remained of approximately $148,000 that was paid to the mother and is presently in a lawyer’s trust account pursuant to an interim order. This would assist the estate in paying debts.
[10] On the 8th day of trial on February 28, 2014, during the course of the examination of Joanne Martin, I learned that this mediation had taken place. On my direction, Ms. Martin produced from her files a letter dated November 22, 2013 from Ms. Sweatman to Mr. Saji in which she stated the following:
We have received instructions to accept the offer to settle all proceedings between our clients and parties with the payment by your client of the amount of $95,000 plus the 2 guitars in return for which title to the house will be transferred to your client subject to the current mortgage, as more particularized in the attached minutes of settlement.
Given we are scheduled in court next week we agree a court order (as attached) should be taken out on consent on Tuesday. We should also with resolution of all matters advise the trial coordinator that the two day passing of accounts trial is not proceeding but that we require less than an hour to attend before the judge to deal with a consent settlement order.
We enclose minutes of settlement, order and release for your review.
Our expectation is that our client will sign the minutes and release today with the release to be held in escrow pending implementation of all the terms of settlement and the parents will sign by Monday.
Please confirm we are settled by no later than 4pm today.
[11] Attached to the letter were Minutes of Settlement incorporating Mr. Bennett’s recommendations, a draft order, a full and final release, a direction to Ms. Sweatman from Joanne Martin to pay her legal fees in the amount of $60,000 and a retainer agreement between Ms. Sweatman and Ms. Martin. The Minutes of Settlement and the release were signed by Ms. Martin on behalf of the estate, by her parents and later by Fillippo Vitale Jr. They were not signed by Myrna.
[12] It appeared to me that the case may have been settled. I directed a hearing on whether or not the case had been settled. The hearing took place on April 2, 2014. Mr. Saji retained Mr. J. Webster to represent him. Ms. Sweatman, Mr. Saji, Mr. Bennett, Mr. Fillippo Vitale Jr. and Mr. W. Kowolachuk, who represented the parents at the mediation, testified.
[13] After the mediation hearing the parties were agreed on the basic concept of the estate conveying the house to Myrna and her getting a mortgage on the house with the assistance of her daughter, Christina Wigle, who would guarantee the mortgage. Myrna would pay into the estate between $90,000 and $100,000. Myrna would use the balance of the funds from the mortgage to pay out the existing mortgage in the approximate amount of $54,000, pay Mr. Saji’s legal fees and other expenses associated with the transfer of title including land transfer tax. I had heard evidence that the house had an approximate value of $220,000. This seemed to me to be a very reasonable approach.
[14] There was a conference call on November 20, 2013, among Mr. Bennett, Ms. Sweatman and Mr. Saji. Mr. Bennett recommended that the estate and Myrna split the difference and that Myrna pay into the estate $95,000. Ms. Sweatman testified that Mr. Saji said on behalf of Myrna “can do”. She made notes that Mr. Saji said this. She interpreted this to mean that Myrna would pay this amount into the estate. This was an entirely reasonable interpretation for her to make of this statement. The other parties to the conversation did not make notes. I accept her evidence. She knew that Joanne Martin would accept this for the estate. Filippo Vitale and the parents accepted it. She prepared the Minutes of Settlement and the supporting documents. She had Joanne Martin, the parents and Fillippo Vitale Jr. sign the documents.
[15] In a letter dated November 25, 2013, Mr. Saji sought to resile from the agreement. He stated that his client would only pay $75,000 into the estate. In a letter dated November 27, 2013, he stated that the “maximum mortgage available is $175,000”. He pointed out that after payment of the existing mortgage of $54,000 and $75,000 to the estate for a total of $129,000, this would only leave $46,000 for his legal fees and other expenses including the costs associated with transferring title of 38 Chalmers to Myrna. This was in contrast to $26,000 which would have remained if Myrna paid $95,000.
[16] The difficulty here is that Mr. Saji is acting for Myrna on a contingency – it is not a percentage agreement on money to be paid but his getting paid is contingent on the success of Myrna’s application for support. He has sent no accounts to Myrna. He has charged her nothing for his work to date. He will get paid from money or assets that she may receive. He confirmed this in the hearing before Justice Reilly where a dialogue took place at pp. 64-65 of the transcript as follows:
MR. SAJI: … So essentially that’s one of the big arguments. Sell the home, pay off my legal bills, which oh by the way Myrna, you’ve got to just keep funding your own legal bills, which by the way she’s not. But we’ll have to wait until …
THE COURT: Let me catch your drift. Are you saying that you’ve undertaken this litigation pro bono, Counsel?
MR. SAJI: No. I’m saying Myrna does not have the funds, of course, to pay her legal fees and so our success, our firm’s success is going to depend on the hearings and perhaps this motion today. But that’s – pay my legal fees but you’re on your own on the other side. So let’s be – are we going to be all on the same boat or not?
He also confirmed this before me.
[17] In Oliveira v. Tarjay, 2006 CanLII 8870 (ON CA), [2006] O.J. No. 1109 the Court of Appeal stated the following:
2 It is well-established law that a solicitor of record has the ostensible authority to bind his or her clients and that opposing counsel are entitled to rely upon that authority in the absence of some indication to the contrary: see Scherer v. Paletta 1966 CanLII 286 (ON CA), [1966] 2 O.R. 524 (C.A.) and Mohammed v. York Fire and Casualty Insurance Co., 2006 CanLII 3954 (ON CA), [2006] O.J. No. 547 at para. 20 (C.A.). There was no such indication here. Consequently, as between these parties, the plaintiffs are bound by the act of their solicitor.
[18] Mr. Saji bound Myrna to paying $95,000 to the estate in the telephone conversation on November 20, 2013. Ms. Sweatman, who knew that her client would accept the proposal made by Mr. Bennett, confirmed this in her letter dated November 22, 2013. She prepared Minutes of Settlement. Her client, her client's brother and her client's parents signed them. I find that the case was settled in the conference call on November 20th, which settlement was confirmed by Ms. Sweatman's letter dated November 22nd. The settlement was conditional on the approval of a judge. This is illustrated by the wording of Ms. Sweatman's letter and the draft order attached to it. I approve it, subject to some minor adjustments.
[19] Myrna is in a position where she can instruct Mr. Saji to make any proposal no matter how unreasonable without apparent risk to her. If the proposal fails, she suffers no loss. This is in contrast to the position of Ms. Martin who retained counsel, first Ms. L. Draminsky, who charged her about $30,000 and then withdrew from the case and then Ms. Sweatman, whom I understand has charged her about an additional $30,000 and has also withdrawn from the case. She has incurred personal liability for these accounts which have been assessed.
[20] Mr. Webster submits on behalf of Mr. Saji that I should find that there was no settlement. He relies on Rule 49.09 which states the following:
49.09 Where a party to an accepted offer to settle fails to comply with the terms of the offer, the other party may,
(a) make a motion to a judge for judgment in the terms of the accepted offer, and the judge may grant judgment accordingly; or
(b) continue the proceeding as if there had been no accepted offer to settle.
[21] In Deman Construction Corporation v. 142036 Ontario Inc., [2007] O.J. No. 2705, Justice van Rensburg (as she then was, now van Rensburg J.A.) interpreted this rule as giving a plaintiff a choice of seeking to enforce a settlement or proceeding with a trial. She stated the following:
27 The options available to a non-defaulting party are set out disjunctively. That is, an accepted offer to settle can be enforced through a motion for judgment or the accepted offer can be ignored, restoring the non-defaulting party to its original rights in the proceedings.
And:
33 Accordingly, when DeMan continued its original claim following the defendants' default, it was exercising its rights, and the election, provided by Rule 49.09. It did not have the option of pursuing both at the same time, as there was nothing in the settlement itself that reserved the right to sue on the original contract on default or repudiation. When the defendants defaulted, the plaintiff did not move immediately to enforce the settlement. Rather, it continued its original proceedings, participating as a respondent in the appeal of the original judgment to the Court of Appeal, conducting an examination in aid of execution on the reduced judgment, and continuing the pleadings and discovery process, all without reference to the Settlement Agreement. This clearly demonstrated an election to continue the original proceedings "as if there had been no accepted offer to settle".
[22] This rule and the cases that interpret it must be considered with the following rules:
1.04 (1) These rules shall be liberally construed to secure the just, most expeditious and least expensive determination of every civil proceeding on its merits.
2.01 (1) A failure to comply with these rules is an irregularity and does not render a proceeding or a step, document or order in a proceeding a nullity, and the court,
(a) may grant all necessary amendments or other relief, on such terms as are just, to secure the just determination of the real matters in dispute; or
(b) only where and as necessary in the interest of justice, may set aside the proceeding or a step, document or order in the proceeding in whole or in part.
[23] It also must be interpreted in light of the fact that Ms. Martin, who represents the estate, is self-represented. Neither the estate nor she personally can afford to retain a lawyer. As a judge who will have been on the bench 15 years on June 1st, I say this about Ms. Martin’s representation of the estate. Her advocacy has been superb for a self-represented person. She carries an enormous burden, which would crush many people. She has remained in control at all times. She has been very well prepared. In my view she is as good an advocate as many lawyers that appear before me and better than some. Ms. Martin is not a lawyer. She cannot be expected to know about Rule 49.09 and the case law that interprets it.
[24] Justice Karakatsansis, speaking for the Supreme of Canada in Hryniak v. Mauldin 2014 SCC 7 stated the following:
1 KARAKATSANIS J.:-- Ensuring access to justice is the greatest challenge to the rule of law in Canada today. Trials have become increasingly expensive and protracted. Most Canadians cannot afford to sue when they are wronged or defend themselves when they are sued, and cannot afford to go to trial. Without an effective and accessible means of enforcing rights, the rule of law is threatened. Without public adjudication of civil cases, the development of the common law is stunted.
2 Increasingly, there is recognition that a culture shift is required in order to create an environment promoting timely and affordable access to the civil justice system. This shift entails simplifying pre-trial procedures and moving the emphasis away from the conventional trial in favour of proportional procedures tailored to the needs of the particular case. The balance between procedure and access struck by our justice system must come to reflect modern reality and recognize that new models of adjudication can be fair and just.
And:
27 There is growing support for alternative adjudication of disputes and a developing consensus that the traditional balance struck by extensive pre-trial processes and the conventional trial no longer reflects the modern reality and needs to be re-adjusted. A proper balance requires simplified and proportionate procedures for adjudication, and impacts the role of counsel and judges. This balance must recognize that a process can be fair and just, without the expense and delay of a trial, and that alternative models of adjudication are no less legitimate than the conventional trial.
28 This requires a shift in culture. The principal goal remains the same: a fair process that results in a just adjudication of disputes. A fair and just process must permit a judge to find the facts necessary to resolve the dispute and to apply the relevant legal principles to the facts as found. However, that process is illusory unless it is also accessible -- proportionate, timely and affordable. The proportionality principle means that the best forum for resolving a dispute is not always that with the most painstaking procedure.
[25] In the report of the National Action Committee for Access to Justice in Civil and Family released in October 2013, Chief Justice McLaughlin of the Supreme Court of Canada in the forward stated the following:
But as Canadians celebrated the new millennium, it became clear that we were increasingly failing in our responsibility to provide a justice system that was accessible, responsive and citizen-focused. Reports told us that cost, delays, long trials, complex procedure and other barriers were making it impossible for more and more Canadians to exercise their legal rights.
The committee was chaired by Justice Cromwell of the Supreme Court of Canada. The report in the executive summary stated the following:
There is a serious access to justice problem in Canada.
The civil and family justice system is too complex, too slow and too expensive. It is too often incapable of producing just outcomes that are proportional to the problems brought to it or reflective of the needs of the people it is meant to serve. While there are many dedicated people trying hard to make it work and there have been many reform efforts, the system continues to lack coherent leadership, institutional structures that can design and implement change, and appropriate coordination to ensure consistent and cost effective reform. Major change is needed.
[26] Mr. Webster also relies on case law which stands for the proposition that a judge should only enforce a settlement if it is fair and that a judge has discretion as to whether to enforce a settlement. In Brozowski v. Oleary, [2004] O.J. No. 323, Justice Misener stated the following:
43 As for the case law bearing on the manner in which the judge should exercise his discretion, it is sufficient for me to cite Milios v Zagas 1998 CanLII 7119 (ON CA), [1998] O.J. No. 812 and Fox Estate v Stelmaszyk 2003 CanLII 36922 (ON CA), [2003] O.J. No. 2619.
44 Those judgments emphasize the judicial obligation to consider all of the circumstances of the case at hand, and to then decide whether it is fair to enforce the settlement. Although I risk unduly limiting my discretion by saying so, I think the right approach is to consider that a settlement effected pursuant to Rule 49 ought to be enforced, and so judgment ought to be granted, unless the offeror satisfies the judge that, in all the circumstances, enforcement would create a real risk of a clear injustice. It seems to me that that approach is required because it is good public policy to encourage settlement, and it would be quite inconsistent with that policy to decline enforcement unless a good reason for doing so is shown.
[27] Ms. Martin has provided me with the decision of Justice Reilly in Sarson v. Cook, [2009] O.J. No. 189 in which he thoroughly reviewed the case law on enforcing settlements and held that the case was settled based on evidence of oral discussions.
[28] In Davis v. Crawford 211 ONCA 294 the Court of Appeal, with respect to lump sum support, stated the following:
[67] The advantages of making such an award will be highly variable and case-specific. They can include but are not limited to terminating ongoing contact or ties between the spouses for any number of reasons (for example, short-term marriage; domestic violence; second marriage with no children, etc.); providing capital to meet an immediate need on the part of a dependant spouse; ensuring adequate support will be paid in circumstances where there is a real risk of non-payment of periodic support, a lack of proper financial disclosure or where the payor has the ability to pay lump sum but not periodic support; and satisfying immediately an award of retroactive spousal support.
[29] Myrna seeks periodic spousal support from the estate. The estate has no money to fund periodic support. She will acquire equity in the house of its estimated value of $220,000 less what she will pay into the estate of $95,000 equal to $125,000. This is equivalent to a payment of lump sum support to her in this amount. The factors in Davis applied to this case support an award of lump sum support. In my view, the Minutes of Settlement are eminently fair to Myrna.
[30] There will be an order to go in terms of the Minutes of Settlement attached to Ms. Sweatman’s letter dated November 22, 2013 and the draft order attached as well. I would think that that a single order could be prepared. Added to para. 1 of the Minutes of Settlement will be the following:
Payment to be made by Monday, May 5, 2014 failing which Joanne Martin may move before me for an order granting her possession of 38 Chalmers Street in Cambridge and for its sale.
I directed Mr. Saji, who is the last remaining lawyer on the case, to prepare the order which is to be signed or approved by me. He has done so. I have made some minor changes designed to put the settlement into place. The order will be as follows:
COURT FILE NO.: ES-997-12
ONTARIO
SUPERIOR COURT OF JUSTICE
The Honourable Mr. Justice ) Friday, the 4th day of P.B. Hambly ) April, 2014
BETWEEN:
MYRNA WINNIFRED VITALE,
Applicant
and
JOANNE MARTIN, Estate Trustee of the Estate of SALVATORE VITALE, and in her personal capacity, FILIPPO VITALE and GIUSEPPINA VITALE
Respondents
COURT FILE NO.: ES-726-12
BETWEEN:
JOANNE MARTIN, as Estate Trustee of the Estate of Salvatore Vitale
Applicant
and
MYRNA WINNIFRED VITALE, LISA HOWARD, CHRISTINA WIGLE, MICHAEL VITALE, MICHAEL LEGERE, CAROLE CARDOSO, FILLIPPO VITALE JR., TYLER MARTIN, JOSHUA MARTIN, MARCEL RAYMOND GIRARD aka MARCAL RAYMOND, DONNIE ELLISON, FILIPPO VITALE AND GIUSEPPINA VITALE
Respondents
COURT FILE NO.: ES-698-13
IN THE MATTER OF THE ESTATE OF SALVATORE VITALE, deceased
JUDGMENT
THIS COURT DIRECTED DETERMINATION OF AN ISSUE in the within Application with Court File No. ES-698-13, in the Application for Directions with Court File No, ES-726-12 and in the Application for Dependant’s Relief with Court File No. 997-12 was heard this day at the Court House, 85 Frederick Street, Kitchener, Ontario N2H 0A7 in the presence of Mr. John Webster, counsel for Mr. Asad Saji, Mr. Asad Saji, lawyer for Myrna Winnifred Vitale, Christina Wigle, Lisa Howard and Michael Vitale and in the presence of Joanne Martin, the Estate Trustee of the Estate of Salvatore Vitale, Filippo Vitale, Giuseppina Vitale and Fillippo Vitale Jr., all appearing in person.
ON READING the Minutes of Settlement dated November 22, 2013 and the evidence filed by the parties, on hearing the oral evidence presented and on hearing the submissions of John Webster, Joanne Martin, Filippo Vitale, Giuseppina Vitale and Fillippo Vitale Jr.
THIS COURT ORDERS that Myrna Winnifred Vitale shall deliver $95,000.00 by certified cheque to the Estate of Salvatore Vitale c/o Joanne Martin. Payment to be made by Monday, May 5, 2014 failing which Joanne Martin may move before Justice Hambly for an order granting her possession of 38 Chalmers Street in Cambridge and for its sale.
THIS COURT ORDERS that Joanne Martin, as estate trustee, shall transfer title to 38 Chalmers Street, Cambridge, subject to adjustments in accordance with the Order of Justice Reilly dated September 19, 2013 which is attached hereto as Exhibit A and subject to the current outstanding mortgage, from the Estate to Myrna Vitale. To clarify, Myrna Vitale will either assume or discharge the current outstanding mortgage on title and the $95,000 represents “new” money.
THIS COURT ORDERS that Joanne Martin shall provide a copy of the deed for 38 Chalmers Street registered in the name of Salvatore Vitale to Mr. Saji forthwith upon this order being issued and entered. He shall prepare a deed transferring the property to Myrna Vitale. He shall attend upon Joanne Martin at a place and time to which they agree on or before May 5, 2014. He shall provide Joanne Martin with the certified cheque in the amount of $95,000 and she shall sign the deed conveying 38 Chalmers to Myrna Vitale. The costs of registration of the deed including land transfer tax and any other costs associated with the transaction shall be paid by Myrna Vitale.
THIS COURT ORDERS that Myrna Vitale will deliver the 2 guitars (1-Black Gibson Les Paul Electric Guitar bought October 25, 1978 with case and all accessories and 1- 1979 Sigma Acoustic Guitar in natural colour in proper case with accessories bought April 21, 1979) owned by Salvatore to Joanne Martin on or before November 30, 2013.
THIS COURT ORDERS the $61,000 held in trust by Fabio Gazzola shall be delivered forthwith to Joanne Martin, Executor of the Estate of Salvatore Vitale, without any deductions.
THIS COURT ORDERS that the application for directions in court file no. ES 726-12 is dismissed without costs.
THIS COURT ORDERS that the application in court file no. ES 997-12 is dismissed without costs.
THIS COURT ORDERS that the within application in court file no. ES 698-13 is dismissed without costs.
THIS COURT ORDERS that a copy of this Judgment be filed in court file no. ES 726-12, ES 997-12 and ES 698-13.
THIS COURT ORDERS that the rental income from May 2012 for the property is attributable to Myrna Winnifred Vitale for income tax purposes.
THIS COURT ORDERS that Filippo and Giuseppina Vitale release all interest and claim to the $61,000.00 delivered to Joanne Martin.
THIS COURT ORDERS that Joanne Martin will deliver to Filippo and Giuseppina Vitale $6,000.00.
THIS COURT ORDERS that the eight guns and two gun cabinets which belonged to Salvatore and are now in the possession of Michael Legere are considered estate assets and Joanne Martin is able to seek their return as Estate Trustee.
THIS COURT ORDERS that the parties are prohibited from bringing any further claims related to the estate of Salvatore Vitale.
This Judgment bears interest at the rate of 3.0 percent per year commencing on May 5, 2014.
Court House
85 Frederick Street
Kitchener, Ontario N2H 0A7
[31] I invite counsel and Ms. Martin to make further submissions if they wish to do so on the wording of the order to be delivered to me by e-mail within the next five days. Upon my final approval of the wording of the order I direct Mr. Saji to deliver the order to me by e-mail for final approval. My office will return the approved order to him. I direct that he then have it issued and entered at the Local Registrar’s office and that he provide copies of the issued and entered order to all parties.
[32] The estate has been successful in enforcing the Minutes of Settlement. However, in my view this is not a case for costs. I am not unsympathetic to Myrna’s difficulties. Her health is very poor. She is unable to work. Whether she will be able to stay in the house after increasing the existing mortgage in an amount large enough to pay off the existing mortgage, pay $95,000 into the estate, pay the costs associated with the transfer of 38 Chalmers to her and pay Mr. Saji’s fees is doubtful. This will depend partly on the size of Mr. Saji’s account which is unknown at this stage, since he has never delivered an account to Myrna. It will also depend on the generosity of Myrna’s daughter, Christina Wigle, who undoubtedly has other responsibilities. An order of costs against her could be crushing.
[33] Ms. Martin submits that I should make an order that Mr. Saji pay the estate’s costs personally pursuant to Rule 57.07. She relies on the case of A and B v. Missauga, [2009] O.J. No. 4670 in which Justice Price made a modest award of costs against a lawyer personally who had commenced duplicate actions on behalf of his client. She points out that Mr. Saji accepted a retainer to take a case to trial which I have held was settled. She also points out that she has incurred liability personally for very substantial legal fees while Mr. Saji has acted for Myrna without charging her anything with the expectation of taking his fees out of whatever she may receive in these proceedings. This is a form of contingency fees, which the Court of Appeal has approved.
[34] This case is an illustration of the perils of contingency fees because the lawyer has a financial interest in the outcome of the case. This is dramatically illustrated in Mr. Saji’s letters dated November 25 and November 27 in which he sought to resile from the settlement that I have held was reached. He said that Myrna could place a mortgage on 38 Chalmers Street of $175,000, which could be used for the discharge of the current mortgage in the amount of $54,000 and payment of $75,000 to the estate for a total of $129,000. He stated that “all that remains is $46,000 towards payment of our legal fees…” and other expenses. There is a stringent test that a party who seeks the costs of litigation against a lawyer personally that was set out by Justice McLaughlin for the Supreme Court of Canada in Young v. Young, 1993 CanLII 34 (SCC), 1993 4 S.C.R. 3 as follows:
254 … courts must be extremely cautious in awarding costs personally against a lawyer, given the duties upon a lawyer to guard confidentiality of instructions and to bring forward with courage even unpopular causes. A lawyer should not be placed in a situation where his or her fear of an adverse order of costs may conflict with these fundamental duties of his or her calling.
While it is a close call I am not convinced that an award of costs personally against Mr. Saji can meet this test.
[35] I would not think that Mr. Saji would be entitled to any fees from Myrna for his work at this trial since he accepted a retainer to take a case to trial that I have found had already been settled. I leave that to whatever Mr. Saji can work out with his client and to the assessment officer.
Peter B. Hambly J.
Released: April 16, 2014