Superior Court of Justice - Ontario
COURT FILE NO.: CV-19-47
DATE: 2019/09/23
RE: Lewis Pelicos, Executor and Trustee of the Estate of James Pelicos, deceased, Applicant
AND
The Estate of Stelios Pelicos, Respondent
BEFORE: The Honourable Madam Justice A. Doyle
COUNSEL: Eric L. Honey, Counsel for the Applicant
HEARD: In writing
ENDORSEMENT
The text of the original Endorsement of September 13, 2019 was corrected on September 23, 2019, at paras. 2, 7(1),13 and the explanation of the correction is appended.
Overview
[1] The Applicants are seeking an order setting out the court’s directions regarding the questions arising out of the last will and testament of James Pelicos who died on April 19, 1994 pursuant to Rule 14.05 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194.
[2] In his will dated January 1984, James Pelicos required the executors, his two sons, Steven Pelicos and Lewis Pelicos, to hold the residential property located at 50 McGonigal Street West, in Arnprior, Ontario (McGonigal property) in trust for his wife Lillian Pelicos for her lifetime and to pay the necessary maintenance of the property out of the remaining assets of the estate during her lifetime.
[3] The current value of this only asset of the estate is $241,000.
[4] Steven Pelicos died on December 20, 2009 intestate and he is survived by his wife and four 4 adult children. In 1995, prior to his death he received a loan from the estate and a mortgage was placed on McGonigal property. In 2003, he and his wife agreed to buy out his interest in the mortgage registered against McGonigal property.
[5] Lillian Pelicos died on February 7, 2019 intestate.
[6] Lewis Pelicos wishes to sell the McGonigal property and seeks the Court’s direction regarding the rights and obligations of the estate of Steven Pelicos and his widow’s entitlement to a share of the proceeds from the sale of McGonigal Street.
[7] The issues can be stated as follows:
Can it be inferred that the McGonigal property falls into the residue of the estate upon the termination of the life interest of Lillian Pelicos?
Or alternatively, do the beneficiaries of the estate of James Pelicos take their interest on the date of death of James Pelicos or at the date of Lillian Pelicos, the life tenant?
Analysis
[8] Section 9(1) of the Estate Administration Act, R.S.O. 1990, c. E.22, provides the following:
9(1) Real property not disposed of, conveyed to, divided or distributed among the persons beneficially entitled thereto under section 17 by the personal representative within three years after the death of the deceased is, subject to the Land Titles Act in the case of land registered under that Act and subject to subsections 53 (3) and (5) of the Registry Act, and subject as hereinafter provided, at the expiration of that period, whether probate or letters of administration have or have not been taken, thenceforth vested in the persons beneficially entitled thereto under the will or upon the intestacy or their assigns without any conveyance by the personal representative, unless such personal representative, if any, has signed and registered, in the proper land registry office, a caution in Form 1, and, if a caution is so registered, the real property mentioned therein does not so vest for three years from the time of the registration of the caution or of the last caution if more than one was registered. R.S.O. 1990, c. E.22, s. 9 (1).
[9] In Browne v. Moody et al., 1936 CanLII 119 (UK JCPC), [1936] O.R. 422, the Court stated that the “golden rule in interpreting wills is to give effect to the testator’s intention as ascertained from the language which he has used.” The Court also stated that: “The mere postponement of the distribution to enable an interposed life-rent to be enjoyed has never by itself been held to exclude vesting of the capital”.
[10] The case held that the vesting will not be deferred for the convenience of a fund bequeathed for life, the ulterior legatees take a vested interest at the deceased.
[11] This principle was confirmed in Re Oswell, (1982) 1982 CanLII 1877 (ON SC), 38 O.R. (2d) 71, where under directions were sought for advice on the administration of trust property. The Court refers to Jarman on Wills 7th Ed., page 1377 where it is stated that:
Even though there be no other gift than in the direction to pay or distribute in future; yet if such payment or distribution appear to be postponed for the convenience of the fund or property, the vesting will not be deferred until the period in question.
[12] This was further confirmed in Lau v. Mak, 2004 CanLII 6673 (Ont. S.C.), where the court found that the gifts to the residual legatees were not condition on surviving of the child (Cecilia) who would be entitled during her life time income from the capital as the trustee deemed fit. As the gifts to the residual legatees (the other children) was not conditional on surviving Cecilia, then there is a presumption in favour of vesting on the death of the deceased.
[13] Therefore, the Court finds that the McGonigal property vested in both beneficiaries, Steven Pelicos and Lewis Pelicos, as of the date of the testator James Pelicos, and hence the McConigal property does not fall in the residue of the estate of James Pelicos upon the termination of the life of Lillian Pelicos.
Madam Justice A. Doyle
Date: September 23, 2019
Appendix
[2] In his will dated January 1984, James Pelicos required the executors, his two sons, Steven Pelicos and Lewis Pelicos, to hold the residential property located at 50 McGonigal Street West, in Arnprior, Ontario (McGonigal property) in trust for his wife Lillian Pelicos for her lifetime and to pay the necessary maintenance of the property out of the remaining assets of the estate during her lifetime.
[7] The issues can be stated as follows:
- Can it be inferred that the McGonigal property falls into the residue of the estate upon the termination of the life interest of Lillian Pelicos?
[13] Therefore, the Court finds that the McGonigal property vested in both beneficiaries, Steven Pelicos and Lewis Pelicos, as of the date of the death of the testator James Pelicos, and hence the McConigal property does not fall in the residue of the estate of James Pelicos upon the termination of the life of Lillian Pelicos.
COURT FILE NO.: CV-19-47
DATE: 2019/09/23
ONTARIO
SUPERIOR COURT OF JUSTICE
RE: Lewis Pelicos, Executor and Trustee of the Estate of James Pelicos, deceased, Applicant
AND
The Estate of Stelios Pelicos, Respondent
BEFORE: The Honourable Madam Justice A. Doyle
COUNSEL: Eric L. Honey, Counsel for the Applicant
ENDORSEMENT
The Honourable Madam Justice A. Doyle
Released: September 23, 2019