Superior Court of Justice – Ontario
BETWEEN:
Diane Grace Wiley and Richard Ray Kimball Applicants
– and –
Judith Ann Kimball Respondent
COUNSEL:
A. Leardi, for the Applicants
J. Deziel, for the Respondent
HEARD: March 9, 2020
RULING ON APPLICATION
HEBNER J.
1This application was brought by the applicants requesting orders be made consistent with the terms of executed minutes of settlement dated November 3, 2017.
Background Facts
2Many of the individuals to which I will refer in this ruling have the same last name. Accordingly, after they are introduced, for ease of reference I will refer to them by their first names.
3Fern Kimball was the wife of Lloyd Kimball. Lloyd was the founder of a business known as Kimball Lumber. Fern and Lloyd had three children. The applicants, Diane Grace Wiley and Richard Ray Kimball are two of those children. The third child was Harold Kimball. Harold died on August 24, 2014. The respondent, Judith Ann Kimball, is Harold’s widow.
4Lloyd died in March 1976. Fern died on May 10, 2014. Diane and Richard are the executors of Fern’s estate. The main beneficiaries of Fern’s estate are her three children, Diane, Richard and Harold. Harold died after Fern and Judith is the executor of Harold’s estate.
5There were a number of matters that the parties could not agree upon respecting the administration of Fern’s estate. Specifically, the parties could not agree on, among other things: the ownership of a property identified as the “farm lot” located on Gesto Road; the ownership of the two lots identified as “town lots”; guaranteed investment certificates totaling the sum of $191,413.47; distribution of jewelry; and calculation of trustees’ compensation. The parties attended a mediation where an agreement was reached and minutes of settlement were signed. All parties were assisted by counsel at the mediation. The minutes of settlement included the following terms:
The “farm lot”, currently registered in the name of Harold, is an asset of Fern’s estate and is to be transferred to Fern’s estate;
One of the “town lots” was to be transferred to Judith;
One of the “town lots” was to be transferred to Diane;
The parties acknowledged that the GICs were assets of Fern’s estate. They had been collapsed and distributed to Richard and Diane. The distribution was to be credited pro rata to Richard and Diane as against any further entitlement that they may have to share in the estate.
Judith was to be reimbursed for property taxes paid by her on account of the “farm lot” after May 10, 2014.
A procedure was outlined for the distribution of the remaining jewelry.
Provisions were put in place for the calculation of the trustees’ compensation.
Provisions were put in place for the disclosure of certain bank statements and financial information.
The remainder of the assets in the estate would be administered in the ordinary course until complete.
6The applicants seek orders consistent with these terms. The respondent disputes the application. The application was launched when counsel for the applicants sought to accomplish the real estate transfer for the “farm lot” and the respondent did not respond to the requests.
Positions of the Parties
7Diane and Richard take the position that the minutes of settlement are a contract and must be complied with.
8Counsel for Judith asserts that Richard and Diane did not follow the terms of the settlement in that they did not transfer one of the “town lots” to Judith. Counsel for Judith therefore submits that Richard and Diane are in breach of the agreement and are therefore not entitled to enforce it.
9Counsel for Judith also raises the issue of executors’ compensation. He submits that there are only three beneficiaries of the estate, two of which are the applicants; accordingly the only party being charged fees for executor compensation is Judith. As I understand Judith’s position, she asserts that there ought not to be any executors’ fees paid to Richard and Diane.
Analysis
10The submission of Mr. Leardi is that the parties are, prima facie, bound by the minutes of settlement. I agree with that submission. In Olivieri v. Sherman (2007), 2007 ONCA 491, 86 O.R. (3d) 778, the parties were involved in litigation. They attended a mediation and resolved the litigation by way of an offer to settle and an acceptance of the offer. A motion was brought to enforce the settlement. The motion was dismissed. On appeal, the settlement was upheld. At para. 41, Gillese J.A., speaking for the court, said:
The settlement agreement is a contract. Thus, it is subject to the general law of contract regarding offer and acceptance. For a concluded contract to exist, the court must find that the parties: (1) had a mutual intention to create a legally binding contract; and (2) reached agreement on all of the essential terms of the settlement.
11The respondent does not assert that the settlement is anything other than a legally binding contract. Instead, the respondent asserts that the applicants have not complied with the settlement and therefore are not entitled to rely on it. She asserts that the applicants have not complied with the settlement because they have not yet transferred the required “town lot” to her. In order to consider this submission, it is necessary to consider events that occurred subsequent to the execution of the minutes of settlement.
Items Completed
12The following items outlined in the minutes of settlement have been completed:
Paragraph #3 requires that one of the “town lots” be transferred to Diane. That matter has been completed.
Paragraph #4 requires that the guaranteed investment certificates that were distributed to Richard and Diane totaling $191,413.47 be credited to their respective shares in the estate. To complete that matter, Richard and Diane, as executors of the estate, provided Judith with a cheque written on the estate account in the amount of $95,706.73. Judith cashed the cheque. Judith admitted on her cross-examination held October 15, 2019 that paragraph #4 has been completed.
Paragraph #6 sets out a protocol for division of the remaining jewelry. Judith admitted, on her cross-examination, that that paragraph has been completed.
Paragraph #8 requires disclosure of certain bank account statements. Judith admitted, on her cross-examination, that that paragraph has been completed.
Items Not Completed
13The items not completed at the time this matter was argued were:
The transfer of the “farm lot” (paragraph #1);
The transfer of the “town lot” to Judith (paragraph #2);
Judith’s reimbursement for property taxes paid by her on account of the “farm lot” (paragraph #5).
Completion of the administration of Fern’s estate and payment of executors’ compensation (paragraphs #7 and #9).
14On Judith’s cross-examination, it became clear that the property taxes were not reimbursed because Judith could not provide evidence on the total amount of property taxes she paid on account of the “farm lot”. She provided an undertaking to advise how much she had paid and provide receipts. I have no evidence as to whether that has been completed, but given the application requests an order that the estate reimburse Judith for property taxes after receiving evidence that she paid such taxes, there is every indication that the applicants intend to complete the reimbursement.
15That leaves the transfer of the “farm lot” to Fern’s estate and the transfer of the “town lot” to Judith.
16On March 26, 2018, Mr. Leardi sent an email to Mr. Wrigglesworth of Kirwin Partners LLP, counsel acting for Judith at the time of the settlement. Mr. Leardi advised that “Mr. Joe Byrne will be acting on behalf of Diane Wiley and Richard Kimball for all the real estate transfers. I assume that a member of Kirwin Partners will be acting on behalf of Judith Kimball for all the real estate transfers.” Mr. Leardi proposed a closing date approximately 30 days away. Thereafter, there was some communication indicating that a buyer had been located for the “farm lot”.
17On June 29, 2018, Mr. Byrne wrote to Mr. Wrigglesworth stating, “Anthony Leardi has asked when we would be able to transfer the two lots, as we have all mutually agreed upon.”
18On July 26, 2018, Mr. Byrne wrote to Mr. Wrigglesworth stating:
We are informed that there is a potential buyer for the lot which is presently in the name of the Estate of Harold Kimball. The buyer brought the offer here for us to look at; it is for $95,000 which should be acceptable.
At our recent meeting, I understood that you were having the lot transferred from Harold’s Estate to the Estate of Fern Kimball. When this is done the lot can be sold by Richard Kimball and Diana Wiley, and the proceeds put in the Estate of Fern. Please advise as soon as the lot has been transferred.
19On September 27, 2018, Mr. Byrne wrote to Mr. Wrigglesworth stating:
I will now complete the transfer of the two lots in Lloyd Kimball’s name, Lot 3 on Plan 1594 in the Town of Essex to Harold’s Kimball’s Estate, and Lot 4 to Diana Wiley. I will send a transfer to Harold’s Estate to your office for completion and registration. I will complete the transfer to Diana Wiley.
Have you completed the transfer of the lot from Harold’s Estate back to Fern Kimball’s Estate? Please advise as to the progress.
20On December 13, 2018, Mr. Byrne wrote to Mr. Wrigglesworth enclosing draft transfers respecting the 2 lots owned by Lloyd Kimball that were to be transferred to Judith and Diana. He stated:
Our clients will be attending to sign these documents tomorrow. Pursuant to the minutes of settlement, Lot 3 is to be transferred to “Judith Ann Kimball, or as she may further direct”. Would you kindly provide us with a direction as to title in this regard.
Also pursuant to the minutes of settlement and further to our office conference on June 5, 2018, the “farm lot” registered in the name of Harold Kimball is to be transferred to the Estate of Fern Kimball. It will be necessary for you to register a transmission application on behalf of the Estate of Harold Kimball, followed by a transfer to the Estate of Fern Kimball. We have made numerous requests that this transfer be completed and have yet to receive confirmation of same. We would again ask that this be completed as soon as possible.
21On January 23, 2019, Mr. Leardi sent the following email to Mr. Wrigglesworth:
Please advise whether the “farm lot” has been transferred to the estate.
22Mr. Wrigglesworth sent the following response on January 31, 2019:
I don’t believe so however I have been trying to follow up with my client to confirm. I will let you know as soon as I hear from her.
23On March 5, 2019, Mr. Wigglesworth wrote to Mr. Leardi and Mr. Byrne advising that he is no longer acting for Judith. On March 20, 2019, Mr. Leardi sent correspondence to Judith stating:
The minutes of settlement in this matter required the farm lot to be transferred back to the estate. We have been seeking for you to comply with this portion of the minutes of settlement for months. We have received, from time to time, proposals that one or another thing be done with the farm lot. We must insist that the farm lot be transferred to the estate in accordance with the minutes of settlement.
Mr. Byrne’s office has been contacting you for months attempting to get your cooperation. The documentation to accomplish the transfer is already done and has been done for months. We encourage you to contact Mr. Byrne right away and set up an appointment to sign the necessary documentation.
24Mr. Deziel responded on March 22, 2019, advising of his retainer to act for Judith and demanding a full estate accounting prior to the transfer of any property. This litigation then ensued.
25Judith was cross-examined on October 15, 2019. On her cross-examination, she gave the following evidence:
Q. My clients suggest that with regards to the farm lot, the reason why it hasn’t been transferred is because you won’t agree to do that. Do you agree with my clients, or do you disagree?
A. I will turn it over. I agreed to that.
Q. So there was some disagreement on how that was going to be done?
A. Yes.
Q. Do you have an explanation as to why that hasn’t happened yet?
A. No.
26It is clear, from a reading of the entirety of the evidence, that the applicants tried on numerous occasions to complete the settlement, and particularly the real estate transfers required by the terms of settlement. The respondent ignored the requests.
27The respondent’s argument is that the applicants did not comply with that portion of the settlement that required the transfer of the “town lot” to her, or as she may further direct. On December 13, 2018, Mr. Byrne, on behalf of the applicants, requested that she provide a direction as to title. The direction was required for the transfer. The direction was never provided. I conclude the reason the “town lot” was never transferred to Judith was due to Judith’s inaction, and not the inaction of the applicants.
28In his submissions, Mr. Deziel on behalf of the respondent suggested that payment of executors’ compensation to Diane and Richard was somehow unfair. He suggested that as executor fees are taxable and bequests are not, any executor fees would benefit Canada Revenue Agency to Judith’s detriment. I reject that argument. The parties agreed that Richard and Diane, as executors for Fern’s estate, are entitled to executors’ compensation in the normal course in accordance with the usual tariff rate applied in like circumstances. I see no unfairness in that.
29In Donaghy v. Scotia Capital Inc., [2004] O.J. No. 2157, aff’d 2009 ONCA 40, Karakatsanis J. (as she then was) said, at para. 6:
The principle of finality is an important principle. Settlements entered into with the assistance of counsel should be upheld except in the clearest of cases and in exceptional cases.
30This case is one where a reasonable settlement was reached at mediation by all parties with the assistance of counsel. Subsequent to the settlement, the respondent resiled from the settlement without a reasonable explanation. In my view, the settlement is one that ought to be enforced.
Disposition
31For the foregoing reasons, I hereby grant judgment to the applicants in the form of the draft judgment attached to the applicants’ factum, paragraphs #1 through #5 inclusive. In the event the parties are unable to agree on costs, they may make written submissions, to include a costs outline, according to the following timeline:
The applicants may make submissions within 20 days;
The respondent may make submissions within 20 days thereafter;
The applicants may make reply submissions within 10 days thereafter.
“Electronic Signature signed and released by Hebner J.” Pamela L. Hebner Justice
Released: April 30, 2020
COURT FILE NO.: CV-19-27826
ONTARIO SUPERIOR COURT OF JUSTICE
BETWEEN:
Diane Grace Wiley and Richard Ray Kimball Applicants
– and –
Judith Ann Kimball Respondent
RULING ON APPLICATION
Hebner J.
Released: April 30, 2020