CITATION: David Peirson v. Estate of Kathryn Peirson, 2017 ONSC 7077
COURT FILE NO.: CV-17-2064
DATE: 20171127
SUPERIOR COURT OF JUSTICE – ONTARIO
IN THE ESTATE OF KATHRYN RUTH PEIRSON
RE: DAVID PEIRSON, JASON PEIRSON and BRYAN PEIRSON, Applicants
AND:
THE ESTATE OF KATHRYN RUTH PEIRSON and PAUL KERR, Respondents
BEFORE: Van Melle J.
COUNSEL: S. Keser, for the Applicants
K. Rusek, for the Respondents
HEARD: October 24, 2017
ENDORSEMENT
[1] This application came before me on a very busy motions’ day where in excess of 12 hours of motions had to be dealt with in a regular court day. Counsel were adamant that this matter could be dealt with in the 50 minutes indicated on the Confirmation Notice. Despite the fact that this was an Application, neither party filed a Factum. The major issue for the hearing was the issue of costs claimed by the respondent Paul Kerr, and yet the respondents did not serve a copy of the Costs Outline until 10:40 a.m. the day of the hearing. When it became apparent that the hearing was not going to be completed in the allotted time, Ms. Keser suggested coming back another day. I deal with this history here, to emphasize that this is not the way to deal with matters which will clearly take 60 minutes or longer. The appropriate way to proceed would have been to book a long motions’ date and to file the materials (i.e. facta) as required by the Rules of Civil Procedure. In any event, I gave counsel the option to return to argue the entire Application on another date. They declined and I therefore ordered counsel to provide written submissions on the costs issue.
[2] The first issue to be dealt with relates to a Desjardins RRSP held for the benefit of the deceased by her mother. The applicants claimed that the RRSP belonged to the Estate. There was no evidence to support this contention. The applicants then asked that I order that the tax on the RRSP not be paid by the estate. The Income Tax Act states that the estate of a deceased annuitant is liable for taxes exigible on an RRSP to the date of death, thus the order requested cannot be made.
[3] The next issue relates to the costs claimed by Paul Kerr (Kerr). He seeks costs from August 18, 2017 on a substantial indemnity basis in the amount of $12,907.21 or on a partial indemnity basis in the amount of $8,789.38.
[4] Kerr says that the application should have been commenced as an application to compel a passing of accounts by Kerr. Kerr says that the relief claimed in paragraphs 1(c), (d), and (g) all fall within the scope of a formal passing of accounts and that the relief sought in paragraphs 1(a) and (b) was unnecessary as Kerr had informed the applicants on April 7, 2016 that his application for a Certificate of Appointment had been withdrawn. The relief sought in paragraph 1(e) was also unnecessary as any or all of the applicants had the power to be appointed Estate Trustee as of April 7, 2016, upon filing the requisite application with the Estates Office.
[5] All of this may be true, however, present counsel was not retained until August 18. At the attendance before Justice Price on August 17, Kerr, though his lawyer said:
Mr. Kerr does not dispute/oppose the Application but requests a further adjournment to enable himself to comply with Ricchetti J.’s Order.
[6] The applicants say that they attended court on May 25, 2017 and on August 17, 2017. On the May 25th attendance Kerr consented to provide the accounting and all documentation in this matter. He consented to providing financial disclosure and accounting pursuant to the Rules of Civil Procedure within 60 days.
[7] According to the applicants, Kerr provided a form of an accounting but not that required by the Rules. Kerr retained counsel in June of 2017. He also provided disclosure, including disclosure identifying for the first time that he was the beneficiary of an RRSP from Desjardins.
[8] Justice Price on August 17 ordered Desjardins to produce its complete file relating to the RRSP. It had not been produced by October 24, thus the only evidence before me demonstrates that Kerr is the RRSP beneficiary.
[9] On August 17, 2017 Justice Price made orders including an order for costs payable by Kerr in favour of the applicants in the amount of $5,440.27.
[10] Kerr now says he should receive substantial indemnity costs as allegations made against him were serious in nature and included fraud, breach of fiduciary duty, conversion and deceit.
[11] The applicants argue, and I agree, that Kerr is seeking substantial indemnity costs to be awarded on a duty he had to the court from the first instance. He did not dispute the Application itself. In examining the Costs Outline, I note that much time was spent by new counsel in getting “up to speed”. The applicants are not responsible for this. Had Kerr retained Ms. Rusek from the start, it is likely this matter would have resolved without the applicants having to proceed by way of application.
[12] Kerr states in his supplementary affidavit sworn September 1, 2017: “While acting without legal representation in this matter, I served and filed two affidavits, the first sworn on June 27th, 2017 and the second sworn on July 20th, 2017. I have recently retained counsel and received advice with respect to the allegations made against me in this Application. I am submitting this supplementary affidavit to address various issues that were not addressed in my previous affidavits.” The applicants had to respond to this supplementary affidavit. In the response, the applicants explain how their suspicions against Kerr arose.
[13] In my review of the documentation and previous court orders, it appears that some of the actions taken by Kerr were indeed questionable. For example, his claim that the deceased’s mother held a mortgage in the amount of $100,000 on the house owned by the deceased, when he held the Power of Attorney for the deceased’s mother, shows that he was in fact in a position of conflict in this matter.
[14] In his supplementary affidavit, Kerr acknowledges making “inadvertent errors and misstatements” in his administration of the estate. Although he says that none of the actions were with wrongful intent, it is these actions that caused the applicants to be mistrustful.
[15] Kerr acknowledges he should have sought legal and accounting assistance much earlier. The fact that he did not do so cannot be laid at the feet of the applicants.
[16] In the total circumstances of this Application, Kerr is not entitled to the costs he has claimed and there shall be no further order as to costs.
_______________________
Van Melle, J
Date: November 27, 2017
CITATION: David Peirson v. Estate of Kathryn Peirson, 2017 ONSC 7077
COURT FILE NO.: CV-17-2064
DATE: 20171127
SUPERIOR COURT OF JUSTICE - ONTARIO
DAVID PEIRSON, JASON PEIRSON and BRYAN PEIRSON, Applicants
AND:
THE ESTATE OF KATHRYN RUTH PEIRSON and PAUL KERR, Respondents
BEFORE: VAN MELLE J.
COUNSEL: S. Keser, for the Applicants
K. Rusek, for the Respondents
ENDORSEMENT
Van Melle J.
DATE: November 27, 2017