Court File and Parties

Court File No.: 35055/94 New File: No. CV-94-CT-035055-0000 Date: 2016-09-30 Ontario Superior Court of Justice

Between: The Estate of Felice Iacobelli by Tosha Iacobelli in her capacity as Estate Trustee for the Estate of Felice Iacobelli, Tosha Iacobelli also known as Tosha Renee Stoyles personally, Eulise Iacobelli and Nathalia Iacobelli, Plaintiffs

– and –

Dante Iacobelli, in his personal capacity and in his capacity as the Executor of the Estate of Caterina Iacobelli, deceased, and the Estate of Caterina Iacobelli, deceased, Defendants

Counsel: Anthony M. Speciale, for the Plaintiffs Ronald G. Chapman, for the Defendants

Heard: Wednesday, September 28, 2016 Before: L. A. Pattillo J.

Endorsement

[1] The issue before the court is whether the plaintiffs’ claims in respect of inter vivos transfers made by Caterina Iaccobelli prior to her death in 1993, which were dismissed by Order of Klowack J. (the “Motion Judge”) on May 6, 1997 (the “Order”), can be pursued in the action notwithstanding the Order.

[2] This action was commenced by Felice Iacobelli in December 1994, against, among others, his brother Dante. It was primarily based on Felice’s allegation he was deprived of his share of the “family enterprise”. The inter vivos transfers claim in the Statement of Claim alleged Dante, his wife and daughter had received various sums of money from Caterina after her husband’s death in 1989 under the influence and direction of Dante and his wife. Dante brought a motion for summary judgment to dismiss the action.

[3] In her oral reasons on May 6, 1997 allowing the summary judgment motion, the Motion Judge began by referring to the fact that the motion was argued on the basis of materials generated by the parties over the prior two years, including affidavits and cross-examinations. After dismissing Felice’s claim based on “family enterprise”, she noted there was no triable issue resulting from the plaintiff’s claim to an interest in real property including the two Bayview and the two Highway 7 properties. She then stated that it followed that the claims of trust for the equitable remedies of tracing and preservation would also have to be dismissed.

[4] In the last paragraph on page 3 of the transcript of her reasons, the Motion Judge stated:

Further, with respect to any other claims, even if one accepts the plaintiff’s position that his mother told him that he and his brother would share equally in her estate, and that the will so provided, there is nothing to stop a testator from making inter vivos transfers prior to death, and there is no evidence that the mother was incapable of making her own decisions in that regard. Even if one accepts that she was persuaded to do so by the other son, that is by Dante, such persuasion is not actionable barring some supporting evidence of fraud or undue influence, and consequently all claims against the moving parties in that regard are also dismissed.

[5] The Order was not appealed.

[6] The plaintiffs brought a further motion before the Motion Judge on December 1, 1998, which she noted was effectively a motion to amend the Statement of Claim. In her endorsement, the Motion Judge stated:

The cause(s) of action in such amended claim are founded on the existence of a family enterprise and on inappropriate inter-vivos transfers, claims which I have previously summarily dismissed. They cannot be somehow resurrected or presented merely by changing the nature of the relief sought.

[7] After noting that Dante was late in filing material to pass accounts, the Motion Judge ordered Dante (along with his wife and daughter) to attend for cross-examination. She then stated:

There is good reason to believe there were inter vivos transfers to them directly or indirectly. Such cross examinations may include questions relating to the size and content of the estate, including any significant inter-vivos transfers made between the date of death of the father on October 26, 1989 and the date of the death of the mother on June 11, 1993, of which Dante and his family were directly or indirectly the recipients, in order to determine whether the property in those transfers should form part of the estate. Should a cause of action arise as a result, whether or not it is precluded by previous court orders may again be addressed.

[8] On February 19, 1999, the Motion Judge dismissed Dante’s motion to reconsider her December 1, 1998 decision. She further stated:

I will only add that my summary dismissal of Felice’s claims re inter vivos transfers was in the context of a lengthy, confused and prolix claim in which Felice made personal claims against various properties and monies. My December 1, 1998 order recognised there may have been monies advanced by the deceased prior to death in circumstances which created a trust on her behalf and would consequently form part of her estate. This would include, for e.g., monies given by her for investment on her behalf. Recognizing there might be some overlap with what has been dismissed, I added the provision that the Court could again be addressed should that issue arise.

[9] On January 17, 2000, MacFarland J. dismissed Dante’s motion for leave to appeal from the Motion Judge’s December 1, 1998 order. In her brief endorsement, the learned judge stated, in part: “I am not satisfied that the summary dismissal of certain inter vivos transfer claims made by Felice against Dante disposed of such claims for all intents and purposes. Nor am I persuaded that such order would preclude the right of a beneficiary to inquire into such matter on the passing of accounts.”

[10] The cross-examinations of Dante, his wife and daughter as ordered by the Motion Judge took place over 10 days in April 2000.

[11] By Order dated March 27, 1998, the Public Guardian and Trustee (“PGT”) was appointed as litigation guardian for Felice in the action.

[12] Felice died on November 3, 2012.

[13] The Motion Judge retired from the court in 2013.

[14] There is no issue that since the completion of the cross-examinations of Dante and his wife and daughter in April 2000, no steps have been taken by the plaintiffs to deal with the inter vivos claims in the action.

[15] At the request of the parties, I began case managing this action and other actions/applications involving the parties in September 2015. At the second case conference on December 3, 2015, Mr. Speciale indicated that the plaintiffs wished to proceed with their claim for inter vivos transfers pursuant to the Motion Judge’s direction in her December 1, 1998 endorsement.

[16] Given the background, I directed that the plaintiffs provide a list of the inter vivos transfers arising from the cross-examinations of Dante and his family by January 31, 2016, failing which any claim by the plaintiffs concerning inter vivos transfers would be over.

[17] The plaintiffs did not provide the list as ordered. Mr. Speciale said that he had issues getting the files from the PGT. At the third case conference on February 23, 2016, and notwithstanding Mr. Chapman’s submission that I dismiss the request to proceed with the claim for inter vivos transfers, I granted the plaintiffs one final extension to the next case conference to produce a list of inter vivos transfers relied on by his client.

[18] On March 29, 2016, the day before the next case conference was to take place, Mr. Speciale sent a letter to Mr. Chapman purporting to list the inter vivos transfers. The letter also referred to particulars of inter vivos transfers set out by the PGT in its letter of May 29, 2004, concerning objections to Dante’s passing of accounts. The letters refer to the Bayview and Peel properties pleaded in the proposed Amended Statement of Claim which were not allowed to proceed. Further the letters refer to the December 1989 and May 1990 transactions in the CIBC bank account which were also specifically pleaded in the proposed Amended Statement of Claim which the Motion Judge did not allow on December 1, 1998.

[19] In considering the original pleading in issue before the Motion Judge together with her reasons, it is my view that she dismissed the claim for inter vivos transfers on the ground that the plaintiff had not provided sufficient evidence to support such a claim. In other words, based on the record before the court, the plaintiff had not demonstrated a triable issue. In subsequently ordering the cross-examinations of Dante, his wife and daughter and stating that if a cause of action arose as a result, the court would consider whether it was precluded by previous court orders, the Motion Judge was throwing the plaintiff a lifeline by effectively saying that if the plaintiff obtained evidence in the cross-examinations that gave rise to a cause of action to set aside inter vivos transfers, the court would address it.

[20] Mr. Chapman submits that the only claims in respect of inter vivos transfers that can proceed in the face of the Order are those which were not within the knowledge of Felice at the time of the initial Statement of Claim. I do not accept that submission. In my view, given the basis of the Motion Judge’s dismissal of the inter vivos transfers claim and her subsequent rulings, particularly February 19, 1999, I do not consider that she was restricting the court’s further consideration of the inter vivos claims to just those the plaintiff was not aware of at the time of the claim. The claim for inter vivos transfers should be allowed to proceed if the plaintiffs can establish from the cross-examinations facts that support a cause of action, whether such claim was previously asserted or not.

[21] I agree with the comment of MacFarland J. that Felice was not precluded from asserting a claim or claims concerning inter vivos transfers. In my view, however, in the circumstances, he could only do so where he could establish on the evidence a cause of action.

[22] On the plaintiffs’ motion before me, as with the letters from the PGT in May 2004 and Mr. Speciale’s letter of March 29, 2016, while the facts of the alleged improper transfers are set out (as they were in the Statement of Claim before the Motion Judge), there is no summary of the evidence arising from the cross-examinations that permits the court to determine whether a cause of action in respect of the alleged improper transfers exists. It is simply a repetition of what was pleaded in the Amended Statement of Claim which was not permitted by the Motion Judge.

[23] For the above reasons, therefore, I have concluded that the plaintiffs cannot pursue their claims in the action in respect of inter vivos transfers. The claims were dismissed by the Motion Judge on May 6, 1997. The cross-examinations took place in April 2000. The plaintiffs have had more than enough time to bring forward evidence to establish a cause of action in respect of any inter vivos transfer claims – i.e. to put their best foot forward. They did not do that before the Motion Judge and they have not done it before me.

[24] Given the above disposition, it is not necessary to address the defendants’ limitation argument.

[25] The plaintiffs’ motion is therefore dismissed.

[26] The defendants are entitled to their costs of the motion. Neither counsel have provided a costs outline. Mr. Speciale requested substantial indemnity costs of between $10,000 and $12,000 based on a Rule 49 offer. Mr. Chapman submitted a partial indemnity amount of $10,000.

[27] It is unfortunate that neither counsel has submitted a costs outline to enable the court to properly consider the work done and the costs incurred. In their absence, the court is left to determine a fair and reasonable amount for costs based on an assessment of the issues and the material provided. The motion lasted two hours. Having regard to the r. 57 factors, I consider that a fair and reasonable cost award for the defendants on a partial indemnity basis would be $5,000. Costs to the defendants fixed at $5,000 in total, payable forthwith.

L. A. Pattillo J. Released: September 30, 2016