Ford v. Mazman, 2019 ONSC 542

NEWMARKET COURT FILE NO.: CV-18-135091

DATE: 20190121

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

CARLEEN ANN FORD and LAURA LEE KRAMER

Applicants

– and –

SETA MAZMAN

Respondent

COUNSEL:

N. Milton, for the Applicants

D. Pomer, for the Respondent

HEARD: January 4, 2019

RULING ON APPLICATION

CASULLO J.:

[1] This is a motion to pass over the Respondent and appoint the Applicants as estate trustees of the estate of Mary Leonard (“Mary”). Mary died on April 3, 2017.

THE PARTIES

[2] The Applicants, Laura Kramer (“Laura”) and Carleen Ford (“Carleen”), are sisters and Mary’s nieces. They live in British Columbia and Alberta, respectively. Laura and Carleen are the only beneficiaries named in Mary’s 2004 Will and are ad idem on this motion.

[3] The Respondent, Seta Mazman (“Seta”), was a close friend of Mary’s for over 50 years. Mary appointed Seta to be her estate trustee. While Seta was the sole Power of Attorney for Mary in a 1989 grant, in 2004 Mary revised her POA, naming Laura as her alternate attorney.

THE FACTS

[4] Mary did not have children. In many respects, Laura was like her daughter. In March 2017, Mary was admitted to Hospital with a blood disorder. Laura flew east to be with her on March 19, 2017, staying at Mary’s home. Mary was lucid, but weak and very ill. Seta was in Florida until late March, but she and Laura were in contact during this time, concerned as they both were about Mary.

[5] Mary knew how ill she was. Since Seta was out of the country, Laura assisted Mary with getting her personal affairs in order. Laura had previously dealt with banks and utilities during one of Mary’s prior illnesses. In addition, in 2004, Mary added Laura as a signatory on a variety of bank accounts, and ensured Laura had access to her safety deposit box.

[6] Mary asked Laura to locate her will, which Laura found in Mary’s safety deposit box. It was executed in 2004, and Mary was disappointed because she thought she had made a newer will. Mary wanted to make some changes to her will, both to minimize taxes, and because she did not want her home sold immediately. It was her hope that Laura might move back to Ontario and live in it.

[7] Mary talked to Laura about a number of alternatives to the 2004 will, including selling her home to Laura for $1.00, and making a new will. Mary reached out to her longstanding solicitor, John Cirillo, to facilitate these changes. Unfortunately, Cirillo was unavailable, and Mary was referred to one of his colleagues, Tim Petrou. Because Petrou could not immediately visit Mary in the Hospital, he suggested that Mary could write out her wishes by hand and sign them.[^1]

[8] Accordingly, Mary wrote out a codicil dated March 24, 2017, in which she bequeathed her home to Laura. The codicil is entirely in Mary’s handwriting. It is dated and witnessed by Beverly Gilley-Yannuzzi, another long-time friend of Mary’s, and Robert Lockwood, who is unfamiliar to the parties. Unfortunately, the holograph codicil has created more trouble and expense than Mary might have anticipated.

MARY’S PASSING

[9] Laura could only stay in Ontario for two weeks, as she was starting a new job, but she planned to return as soon as she could. In order to continuing assisting Mary from Vancouver, Laura took the 2004 will with her. Mary passed before she could return.

[10] Prior to Mary’s death, and for about a month after, Laura and Seta were on good terms, communicating via Facebook. For example:

Before Mary’s Death

• On March 21, 2017 Laura wrote “Seta, how do I transfer the house to me? She won’t last long and I don’t know what to do. I’m sorry.” Seta replied “I will let you talk to Louie how you can transfer the house. she (sic) might be able to sell it to you for a dollar so you don’t have to pay tax.”
• On March 22, 2017 Laura wrote “I’m waiting for the lawyer to call back. She asked him to come to the hospital. She told him what she wanted. So now we wait. I still can’t get in to her computer.”
• Later that day Laura wrote “Yes we spoke to Joanne and she referred a Tim to us. He had the paperwork so confirmed we were who we are. First step. I guess she thought she had changed it but she hasn’t. She was surprised as much as me.”
• On March 30, 2017 Seta wrote “If you are gone & your mom & Colin are gone, who is going to look after the house? who (sic) is picking up the mail? ho (sic) is paying the bills? If anything happens to Mary in the next few days, what are the arrangements? Laura replied, “I have if (sic) under control what do you think I’ve been doing?”

After Mary’s Death

• On April 6, 2017 Laura wrote “Thanks Seta. Let me know if I can look after anything…I put everything in order before I left.
• On April 20, 2017 Laura wrote “Hi. Checked with mom. She has Mary’s passport.”

Breakdown between Laura and Seta

[11] At some point in May, there was a breakdown between Mary and Seta. Seta accused Laura of forcing Mary to sign the codicil, stealing Mary’s jewellery, changing addresses for utility companies, taking Mary’s passport, improperly accessing Mary’s safety deposit box, etc. However, Seta was in Florida when Laura was assisting Mary in the Hospital, so these denunciations are purely speculative. The above-noted Facebook postings demonstrate Seta knew what Laura was doing to assist Mary while she was in the Hospital, as well as what Mary’s intentions were. While there were many instances of correspondence provided in Seta’s material, these Facebook postings were not included.

Breakdown between Carleen and Seta

[12] For the next few months, it was Carleen who corresponded with Seta. Initially these emails were helpful, with Carleen asking for updates and Seta providing them. Yet by June, Seta was openly critical of Laura:

• On June 5, 2017, “As you know Laura was staying in the house while Mary was in the hospital, I really did not thing (sic) she would go through Mary’s personal stuff while Mary was alive & take things without disclosing to me as to what she was taking…I’m very disappointed & disheartened with her actions.”
• On June 20, 2017, Seta wrote “However with Laura’s interference with utilities, bank account & mail, this process was more challenging & caused delays…her actions were very mean spirited.”

[13] On July 13, 2017, Seta blatantly tried to drive a wedge between Carleen and Laura, demonstrated by the following excerpts:

• There is no such thing as a reading of the Will. Laura & your parents have already seen & read the Will. Remember it was taken by your sister!
• However Laura had made Mary (at her deathbed) to transfer the house to her name. Whether the Judge accepts it or not is questionable. So Mary had NOT WILLED the house to Laura in the original will.
• As ???? (sic) Laura said that the only reason she got to transfer the house was to avoid taxes and she will split the monies with you later after the sale of the house.
• I got news for you! You have to pay taxes out of your pocket for receiving a gift from Laura. If & when CRA finds out that your received a gift & not declared it, you will be in trouble.
• Mary’s Estate will NOT pay for packing or shipping of personal things.
• Were you aware of her actions? (emphases in original)

[14] This email was the straw that broke the camel’s back. The following day Carleen drafted an email to joanne@betterlaw.ca at John Cirillo’s firm, to the attention of Tim [whom I trust is Tim Petrou, who had earlier provided Mary with advice regarding the codicil]. Carleen first asked Tim to ensure that Seta fulfilled her obligations as an executor. Secondly, Carleen asked that Seta stop making allegations against her and her sister:

She’s treating us as if we are thiefs (sic) of the estate, and not as rightful heirs…Seta will not communicate with either Laura or my mother, so I took on that responsibility, but refuse to have her slander our family and cause undue stress…she took away the right to mourn…I also included the most recent email from her, although I have more…which are worse…with respect to her intention to sue my sister.

[15] On November 12, 2017, the solicitors for Mary’s estate provided Laura and Carleen with a copy of Seta’s Notice of Application for Certificate of Appointment of Estate Trustee with a Will, along with an application for probate, which failed to include the codicil. Further, Laura and Carleen were advised that if boxes containing personal and family belongings were not removed from Mary’s home by November 25, 2017, they would be disposed of. This despite repeated requests, unacknowledged by Seta, for access to Mary’s home so Laura and Carleen could assess its contents.

[16] Laura and Carleen served a Notice of Objection to Seta’s application to be appointed estate trustee, and the matter finally came before this court.

ISSUES

[17] Should the court exercise its discretion and pass the Respondent over as estate trustee?

THE LAW

Passing Over

[18] An executor is “passed over” before a certificate of appointment is issued. An executor is “removed” after she has received a certificate of appointment. However, the grounds for both are the same: see Windsor v. Mako, 2008 CanLII 55146 (Ont. S.C.).

[19] Section 37(1) of the Trustee Act, R.S.O. 1990, c. T.23, provides that the Superior Court of Justice may remove a personal representative “and may appoint some other or proper person or persons to act in the place of the executor, so removed.”

[20] Courts are understandably reluctant to interfere with a deceased’s choice of representative. Justice Quinn of this court in Radford v. Radford Estate, 2008 CanLII 45548 (Ont. S.C.), at paras. 97 – 113, set out the relevant legal principles when considering whether to remove an estate trustee. These principles were recently distilled by Shaw J. in Walsh v. Whitford, 2017 ONSC 4532, at para. 19:

• The Superior Court of Justice has inherent jurisdiction to remove trustees
• An application to remove an executor may be made by any person interested in the estate of the deceased
• The choice of estate trustee is not to be interfered with lightly
• The removal of an estate trustee should only occur on the clearest of evidence and there is no other course to follow
• In deciding whether or not to remove an estate trustee, the court’s main guide should be the welfare of the beneficiaries
• The applicant must show that the non-removal of the trustee will likely prevent the trust from being properly executed
• Removal is not intended to punish past misconduct
• Friction alone is not a reason for removal

Administrative Bond

[21] Submissions were also made as to whether, if the court were to pass over Seta, Laura and Carleen should be required to post a bond or security.

[22] Justice Brown in Henderson (Re), 2008 CanLII 69136 (Ont. S.C.) at para. 12, set out the information that should be before a court, by way of affidavit evidence, when an applicant for a certificate of appointment of estate trustee seeks to dispense with a bond:

(i) The identity of all beneficiaries of the estate; (ii) The identity of any beneficiary of the estate who is a minor or incapable person; (iii) The value of the interest of any minor or incapable beneficiary in the estate; (iv) Executed consents from all beneficiaries who are sui juris to the appointment of the applicant as estate trustee and to an order dispensing with an administration bond should be attached as exhibits to the affidavit…; (v) The last occupation of the deceased; (vi) Evidence as to whether all the debts of the deceased have been paid, including any obligations under support agreement orders; (vii) Evidence as to whether the deceased operated a business at the time of death and, if the deceased did, whether any debts of that business have been or may be claimed against the estate, and a description of each debt and its amount; (viii) If all the debts of the estate have not been paid, evidence of the value of the assets of the estate, the particulars of each debt – amount and name of creditor – and an explanation of what arrangements have been made with those creditors to pay their debts and what security the applicant proposes to put in place in order to protect those creditors.

[23] I find that these elements have been satisfied through the affidavits of Laura Kramer, Carleen Ford, and Seta Mazman. In particular, the major debt of the estate is the tax obligation owed to the CRA, which crystalized when Laura received Mary’s significant RRSPs. The Applicants are aware of this obligation and that it must be satisfied.

DISCUSSION

[24] Seta states there is no need to pass her over as estate trustee. She submits that her refusal to honour the codicil is of no moment now that Laura and Carleen have agreed that the house will be transferred to both of them jointly upon probate.

Non-removal will prevent trust from proper execution

[25] Seta’s about-turn does not give me comfort that the estate will be properly executed going forward if she remains at the helm. Refusing to honour the codicil was a shocking affront to her good friend’s dying wishes. Her rationale – that the codicil could not be probated because the witnesses to the codicil were not both present when Mary signed it – was wrong at law. A holograph will may be made entirely by a testator’s “own handwriting and signature, without formality, and without the presence, attestation or signature of a witness”: see s. 6 of the Succession Law Reform Act, R.S.O. 1990, c. S.26 (the “SLRA”). This section applies equally to codicils.

[26] Contrary to Seta’s submission, the mere fact that there are witnesses to the codicil does not remove the codicil’s ‘holograph’ status and bring it within the purview of s. 4 of the SLRA, thereby necessitating an Affidavit of Execution of Will or Codicil pursuant to Rule 74 of the Rules of Civil Procedure, RRO 1990, Reg 194.[^2]

[27] Finally, if Seta had concerns about the codicil, it was her responsibility to seek guidance from the court.

[28] There was much made during the hearing of the value of Mary’s home. Laura and Carleen believe it to be in the vicinity of 1.9 million dollars. The appraisal Seta obtained valued the home at 1.4 million. I do not know that anything rests on this, given the current cooling down of housing prices in Ontario. However, if Seta is passed over, Laura and Carleen will have full control over the home’s sale, which would remove any possible future question that the home was sold below market value.

Friction

[29] This is not a case of mere friction – this is a case of outright hostility from Seta to the beneficiaries. It is difficult to fathom why Seta acted as she did toward Laura and Carleen. Her accusations against Laura, in light of her knowledge of Mary’s intentions on her death bed, were unwarranted. The same can be said of her effort to sow discord between the two sisters, hammering home to Carleen that Laura received so much more from Mary than she did.

[30] Another example of Seta’s enmity is her refusal to arrange or pay for shipping. Why not let the estate pay? The items in question were being shipped to Laura and Carleen, the only beneficiaries of the estate. They would ultimately bear the cost of shipping in any event, and their request was reasonable.

Removal to be guided by welfare of beneficiaries

[31] When considering whether to pass over an estate trustee the court’s main guide should be the welfare of the beneficiaries: see Radford, at para 103.

[32] In this case the welfare of the beneficiaries supports passing over Seta. Laura and Carleen are the only beneficiaries to the estate and are acting in unison. They are aligned on all issues related to the estate, including what assets belong in the estate, and their distribution. There is no dispute between them that would require the continued involvement of any third party trustee.

DISPOSITION

[33] Enormous trust is placed on an estate trustee. Unfortunately, Seta’s conduct makes evident she is not the proper party to serve in this position. I see no juristic reason for her appointment to be confirmed. Indeed, her appointment may cause further delay, an important consideration given the significant tax obligation to CRA, accruing interest daily. It behooves no one to have the estate’s administration drawn out any further.

[34] An order is to issue as follows:

1. The Respondent, Seta Mazman, is passed over as estate trustee;
2. Within 60 days, the Respondent will deliver to the Applicants all of Mary’s, and the estate’s, assets, including all books and records in her possession;
3. Within 60 days, the Respondent shall apply to pass her accounts for the period ending with today’s date;
4. Any compensation to the Respondent shall be dealt with by way of the passing of accounts;
5. The Applicants, Laura Kramer and Carleen Ford, are appointed estate trustees of the estate of Mary Leonard; and
6. The requirement for the Applicants to post any bond or security is dispensed with.

COSTS

[35] If the parties are unable to reach agreement as to costs, I will entertain brief written submissions not exceeding three pages exclusive of attachments (Bill of Costs, Costs Outline, and authorities, if any). The Applicants shall file within twenty days of the release of this decision. The Respondent will then have a further ten days to file. There will be no reply submissions absent leave of the court.

CASULLO J.

Released: January 21, 2019

[^1]: Also in an effort to assist, Laura accessed legalwills.ca, an online will service. Laura drafted a will on Mary’s computer, but this was never printed out for Mary’s review, or signed by Mary. [^2]: One of the witnesses to the codicil, Beverly Gilley-Yannuzzi, refused to sign such an Affidavit because she and the second witness were not present together when Mary signed the Codicil.