CITATION: Driscoll v. Driscoll, et al, 2016 ONSC 6013
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
JON JESSIE WILLIAM DRISCOLL
Applicant
– and –
CAROLINE DRISCOLL, DEANNA FLECK and JEAN GILBERT
Objectors/Respondents
Counsel:
Christopher Moore, for the Applicant
Richard Nishimura and Douglas Menzies, for the Objectors/Respondents
HEARD: Submissions in Writing
COSTS ENDORSEMENT
Mr. Justice Douglas Rutherford
1Shirley Driscoll (Mrs. Driscoll) died in 2014. Her Will, which she had made 18 years previously, left everything to her son Jon Driscoll. There were seven daughters, two of whom had predeceased their mother but had left children (grandchildren to Mrs. Driscoll) of their own. Three of the five surviving daughters filed Objections to Jon Driscoll’s Application for a Certificate of Appointment of Estate Trustee with a Will, claiming that at the time she gave instructions for and executed the Will, their mother lacked the capacity to make a Will and was unduly influenced in its making by her son, Jon.
2For reasons set out in my judgment (Driscoll v. Driscoll et al, 2016 ONSC 4628) I held that Shirley Driscoll had testamentary capacity at the time she executed the Will, that she knew and approved of the contents of the Will she executed, and that she was not subject to undue influence by the Applicant in the making of her Will.
3I have received written submissions on behalf of the parties as to the costs disposition I should make in the matter. The trial took six court days. There was also a summary judgment motion brought by the Applicant prior to trial. While that motion did not proceed to cross-examinations or judgment, it appears that the affidavit production process in preparation for the motion led to and contributed ultimately to the proceedings before Hackland J. for directions pursuant to which the hybrid trial with the use of affidavits and cross-examinations on them before me took place.
4As noted at paragraph 11 of my reasons for judgment, before the value of the estate assets had been formally appraised, the Applicant informally offered to share the estate assets relatively equally with his sisters, suggesting that, if the estate could afford it, $40,000 would go to each of his surviving sisters and another $50,000 would be divided among the issue of the two sisters who had predeceased their mother. The Objectors held out for more, and made an offer some time prior to trial to settle by dividing the estate equally among the three of them and the Applicant, and all bearing their own costs. This was not acceptable to the Applicant, who had counter-offered to let the Objectors off with only partial indemnity costs if they withdrew their Objections. None of these offers were accepted and ultimately the litigation proceeded to trial with the Objectors losing. They were, subject to the question of costs, effectively in no better position than had they accepted the Applicant’s counter-offer.
5The position of the Applicant is that the Objectors should be jointly and severally responsible for the costs of the Applicant on a substantial indemnity basis. A Bill of Costs submitted sets out the Applicants costs in total (fees & disbursements) at $105,260.30 on a Partial Indemnity basis and as $154,303.43 on a Substantial Indemnity basis.
6The position of the Objectors/Respondents is that they acted reasonably and responsibly throughout, had a credible body of evidence in support of their position, and were of very modest means and should not be crushed by the kind of costs award sought by the Applicant, who at the same time, takes the entire estate. They ask that the Court award the Objectors’ disbursements costs (paragraph 26 of the written submission says “the Applicant’s disbursements costs,” but obviously means the Objectors’ disbursements costs) of $15,314.97 as well as their costs on the summary judgment/motion for directions proceedings, said to be $34,912.20 on a substantial indemnity basis, to be paid out of the estate. Beyond that, the Court should require that the parties bear their own costs.
7In McDougald Estate v Gooderham (2005), 2005 CanLII 21091 (ON CA), 255 D.L.R. (4th) 435 (Ont. C.A.) Gillese J.A. said the following about costs in estate litigation in courts of first instance.
78 The practice of the English courts, in estate litigation, is to order the costs of all parties to be paid out of the estate where the litigation arose as a result of the actions of the testator, or those with an interest in the residue of the estate, or where the litigation was reasonably necessary to ensure the proper administration of the estate. See Mitchell v. Gard (1863), 3 Sw. & Tr. 275, 164 E.R. 1280 and Spiers v. English, [1907] P. 122. Public policy considerations underlie this approach: it is important that courts give effect to valid wills that reflect the intention of competent testators. Where the difficulties or ambiguities that give rise to the litigation are caused, in whole or in part, by the testator, it seems appropriate that the testator, through his or her estate, bear the costs of their resolution. If there are reasonable grounds upon which to question the execution of the will or the testator's capacity in making the will, it is again in the public interest that such questions be resolved without cost to those questioning the will's validity.
79 Traditionally, Canadian courts of first instance have followed the approach of the English courts. While the principle was that costs of all parties were ordered payable out of the estate if the dispute arose from an ambiguity or omission in the testator's will or other conduct of the testator, or there were reasonable grounds upon which to question the will's validity, such cost awards became virtually automatic.
80 However, the traditional approach has been - in my view, correctly - displaced. The modern approach to fixing costs in estate litigation is to carefully scrutinize the litigation and, unless the court finds that one or more of the public policy considerations set out above applies, to follow the costs rules that apply in civil litigation.
8In Neuberger v. York, 2016 ONCA 303 para 24 Gillese J.A. reiterated this approach to estate litigation costs, saying,
In estates litigation in Ontario, the historical approach to costs has been displaced in favour of one in which the costs rules in civil litigation apply both at first instance and on appeal, unless the court finds that one or more of the relevant public policy considerations dictate that costs (or some portion thereof) should be paid out of the assets of the estate: McDougald Estate v. Gooderham (2005), 2005 CanLII 21091 (ON CA), 255 D.L.R. (4th) 435 (Ont. C.A.), at para. 80; see also Sawdon Estate v. Sawdon, 2014 ONCA 101, 370 D.L.R. (4th) 686 at para. 101. The public policy considerations at play in estate litigation are primarily of two sorts: (1) where the difficulties or ambiguities that give rise to the litigation are caused, in whole or in part, by the testator; and (2) the need to ensure that estates are properly administered.
9In this case it has been to everyone’s detriment that the early informal offer of generous sharing by the Applicant with his sisters was not pursued to a mutually satisfying disposition of their mother’s estate without litigation. As can happen, the litigation costs can eat up the estate assets substantially, and even completely
10Notwithstanding the early chatter among the some of the sisters in the emails I referred to in my reasons for judgment, there was in fact a substantial body of evidence suggesting that Mrs. Driscoll’s brain surgery had left her impaired to the extent that she lacked testamentary capacity at the time she gave instructions for and executed her will. As I said at paragraph 33 about my central finding as to testamentary capacity,
After long and earnest consideration, I have come to the conclusion that the evidence weighs more heavily in favour of testamentary capacity than against it. In other words, it is more probable than not that Shirley Driscoll was mentally competent to make the Will she did, and, that she knew and approved of the contents of the Will. It is a conclusion I have reached, although not without some difficulty, not only in view of the evidence of cognitive deficits on the part of Mrs. Driscoll, but also because I see the effect of the Will as simply unfair to all her daughters.
While I went on to acknowledge a testator’s right to make unfair, even what may seem cruel decisions in her Will, I am sensitive to Kathy Farmer’s email cry to her sisters,
I will say this…this is the most humiliating thing she could have ever done to any of us…
11In leaving the family assets to the one son and ignoring the seven daughters, it is at least arguable that Mrs. Driscoll may have engaged the first of the public policy considerations that justify awarding costs from the estate to all legitimate parties. But if that is too much of a stretch, the strength of the Objectors’ case against testamentary capacity surely engages the second public policy consideration. In Orfus Estate v Samuel and Bessie Orfus Family Foundation, 2013 ONCA 225 the Court of Appeal upheld the motion judge who ordered the Objector’s costs paid out of the estate assets because he considered the Objector had reasonable grounds on which to launch and pursue her challenge.
12Purity of cause and action may not lie perfectly with either side in this case. However, given my broad discretion in matters of costs, I think justice and equity may best be met in light of my substantive findings and judgment by acceding to the request of the Objectors and awarding them costs totalling $50,227.17, as asked, payable from the estate. The Applicant is entitled to be indemnified for his full costs payable out of the estate as well.
Order accordingly.
Rutherford J.
Released: September 23, 2016.
Driscoll v. Driscoll, et al, 2016 ONSC 6013
COURT FILE NO.: 30082/14
DATE: 2016/09/23
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
JON JESSIE WILLIAM DRISCOLL
Applicant
– and –
CAROLINE DRISCOLL, DEANNA FLECK and
JEAN GILBERT
Objectors/Respondents
COSTS ENDORSEMENT
Mr. Justice Douglas Rutherford
Released:, September 23, 2016