Dessisa et al. v. Demisie

[Indexed as: Dessisa v. Demisie]

Ontario Reports

Ontario Superior Court of Justice

Gilmore J.

January 29, 2020

149 O.R. (3d) 264 | 2020 ONSC 641

Case Summary

Civil procedure — Settlement — Minutes of settlement — Respondent entering into minutes of settlement with former spouse relinquishing right to any proceeds of his estate — Former spouse making new will — Respondent filing notice of objection challenging testator's capacity to execute will and powers of attorney — Respondent was subject to valid and binding minutes of settlement and failed to establish lack of capacity — Notice of objection struck down as frivolous and vexatious.

Wills and estates — Estate administration — Respondent filing notice of objection challenging testator's capacity to execute will and powers of attorney — Respondent made bald allegations with no direct evidence of circumstances surrounding the signing of the documents — Applicants' evidence did not raise any concerns regarding capacity — Notice of objection struck down as frivolous and vexatious.

Wills and estates — Wills — Testamentary capacity — Respondent filing notice of objection challenging testator's capacity to execute will and powers of attorney — Respondent made bald allegations with no direct evidence of circumstances surrounding the signing of the documents — Applicants' evidence did not raise any concerns regarding capacity — Notice of objection struck down as frivolous and vexatious.

A testator made a will in which he appointed his common-law spouse as executor. The couple occupied a home as joint tenants. Their relationship broke down shortly after the making of the will. Pursuant to minutes of settlement, the spouse released her right to spousal support, released her right to make any trust claims against the testator, agreed to buy out his interest in the home and released her right to receive any proceeds of his estate. After separation the testator made a new will and appointed his nephew and a family friend as co-executors and arranged for powers of attorney. A week later he severed the joint tenancy on the home. When the nephew attempted to obtain an application for a certificate of estate Trustee, the former spouse filed a notice of objection, alleging that the nephew was behind both the family law proceeding and the new will and powers of attorney. She alleged that the testator did not have the capacity to sign his will or powers of attorney or that if he did, he did so under duress or was subject to undue influence. She claimed that his capacity was diminished by having been hospitalized after a cancer diagnosis. The co-executors applied to strike the notice of objection.

Held, the motion should be allowed.

There was no evidence that the testator lacked the capacity at the relevant times. His health care team in the hospital assessed him as capable of directing his own care. There was no evidence that his lawyer had any issues with his capacity to sign the will. There was no evidence that the lawyer who registered the transfer of the house had any issue with the testator's capacity to personally sign the acknowledgment and direction. Affidavit evidence from a long-time friend attested to his competence at the time of the execution of the will. The respondent made bald allegations but had none of her own evidence of the circumstances surrounding [page265] the signing of any of the relevant documents. Suspicion of the applicants' motives was insufficient to ground a notice of objection. She was subject to minutes of settlement that were valid, enforceable and binding. The notice of objection was frivolous and vexatious.

Olivieri v. Sherman (2007), 86 O.R. (3d) 778, [2007] O.J. No. 2598, 2007 ONCA 491, 284 D.L.R. (4th) 516, 225 O.A.C. 227, 159 A.C.W.S. (3d) 364, apld

Rules and regulations referred to

Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rule 25.11

MOTION to strike a notice of objection.

Peter D. Woloshyn, for applicants.

Nuwanthi C. Jayatunge, for respondent.

GILMORE J.: —

Overview

[1] The applicants Girma Debela Dessisa ("Dessisa") and Fissiha Wolde ("Wolde") bring this application to strike out the respondent's Notice of Objection dated March 19, 2019. Alternatively, they seek directions from the court.

[2] The Notice of Objection is filed by the deceased's former common-law spouse, Sinkenesh Asseffa Demisie ("Demisie"). Dessisa is the deceased's nephew and Wolde is a family friend of the deceased.

[3] The deceased passed away on July 31, 2018. The deceased and Demisie resided in a common-law relationship for more than 25 years. In 2003, they purchased a home in Toronto at 18 Granger Avenue ("Granger"). Title to the home was taken by the couple as joint tenants.

[4] In October 2016, the deceased was diagnosed with cancer and admitted to hospital in Scarborough.

[5] The deceased made a will on November 7, 2016 in which he appointed Demisie as his executor. The will left the residue of his estate equally to Demisie and the deceased's sister who resides in Ethiopia.

[6] The parties separated on January 22, 2017. On that date, the police were called to the hospital after an allegation that Demisie had threatened to kill the deceased. Demisie was not charged but was asked not to return to the hospital. After that, the deceased took steps to formalize a separation from Demisie.

[7] On February 27, 2018, the deceased commenced an application in the Ontario Superior Court of Justice in Toronto. All issues related to the breakdown of the deceased's relationship with Demisie were resolved by comprehensive Minutes of [page266] Settlement (the "Minutes"). The Minutes dealt with spousal support, property, the Granger home and the deceased's pensions and life insurance policy.

[8] Pursuant to the Minutes, Demisie released her right to receive spousal support, released her right to make any trust claims against the deceased, agreed to buy out his interest in Granger for $253,000 and released her right to receive any proceeds from the deceased's estate, amongst other things. The releases were mutual.

[9] Both parties were represented by counsel throughout the negotiation of the Minutes. The parties to the Minutes initialed each page. The terms of the settlement proposed by the deceased's lawyer were accepted by Demisie's lawyer on June 8, 2018 in writing.

[10] After the parties separated the deceased made a new will dated February 24, 2017. That will appointed the Applicants as co-executors of his estate and left the deceased's entire estate to Dessisa with a gift over to Wolde in the event that Dessisa pre-deceased him. The deceased's lawyer, Annie Chu attended at the Scarborough hospital to review the deceased's will and powers of attorney with him and attended on their execution.

[11] On that same day in February, the deceased named Dessisa and Wolde jointly as his attorneys for property. As well, he named Dessisa as his attorney for personal care with Wolde as the alternate.

[12] On March 2, 2017, the deceased severed the joint tenancy on the Granger home. The acknowledgement and direction to effect the transfer was signed by the deceased personally and not by way of power of attorney.

[13] When Dessisa attempted to obtain an application for a Certificate of Estate Trustee, Demisie filed a Notice of Objection on March 19, 2019. In her Notice of Objection, Demisie alleges [the following]:

[14] Dessisa spoke to police and did not allow her to visit the deceased. He arranged for the deceased to commence family law proceedings.

[15] Demisie believes that it was Dessisa who severed the joint tenancy on Granger by way of the power of attorney for property.

[16] Demisie alleges that Dessisa changed the deceased's life insurance policy to which she was formerly the beneficiary.

[17] Demisie agrees that she signed the settlement document for the family law matter, but her lawyer did not explain the document to her and she never received a signed copy of the Minutes.

[18] Demisie learned of the deceased's death from a family friend. [page267]

[19] Demisie seeks a constructive and resulting trust in the estate.

[20] It is not disputed that the Notice of Objection was drafted by counsel for Demisie, although that counsel was on a limited retainer.

[21] While Demisie requests dependant's relief in her responding affidavit, such a request is not contained in the Notice of Objection. The Notice of Objection does not specifically mention the Minutes.

The Issues

1. Did the deceased have capacity when he signed the Will, Powers of Attorney, Transfer of Granger and the Minutes of Settlement?

[22] Demisie's position is that Dessisa was behind both the family law proceeding and the new will and powers of attorney. She alleges that the deceased did not have the capacity to sign his will or powers of attorney, or that if he did, he was influenced by Dessisa or the documents were signed under duress. She also alleges that Dessisa signed the Minutes after the date of death using the power of attorney, as Demisie did not receive the fully signed Minutes until several weeks after the date of death.

[23] The deceased was diagnosed with cancer in October 2016 and was hospitalized. While his capacity was diminished at that time, the applicants take the position that he was competent to execute the will and powers of attorney in February 2017, the transfer of Granger in March 2017 and to direct the signing of the Minutes on July 20, 2018. They rely on the following evidence to support this position.

[24] The letter dated March 30, 2017 from Mr. Scott Wisner, a Social Worker with Scarborough and Rouge Hospital. Mr. Wisner identifies himself in the letter as part of the health care team caring for the deceased. He advises that the deceased's condition was poor when he was initially admitted on October 20, 2016 but that his condition had improved, and he was deemed capable of directing his own care by the psychiatry team on January 25, 2017.

[25] The deceased's friend, Zewdu Gebre-Hiwet, was at the hospital and present when Ms. Chu attended for the signing of the will and powers of attorney. Mr. Gebre-Hiwet recounts in his affidavit sworn November 1, 2019 that Ms. Chu satisfied herself as to the identity of the deceased and then asked him a series of questions to ensure he was oriented as to time and place. The will was then read to the deceased who indicated that he understood it. [page268] Mr. Gebre-Hiwet's evidence was that the deceased's body was weak at that time due to the cancer, but that his mind was sharp. Both he and Ms. Chu witnessed the will.

[26] In May 2017, the deceased wrote two handwritten notes to his bank manager with specific directions including allowing Dessisa access to a joint account to pay for his caregiving expenses.

[27] Contrary to the assertions in the Notice of Objection, the transfer of Granger did not take place by way of power of attorney. The deceased signed the Acknowledgement and Direction personally as indicated on the transfer.

[28] Dessisa deposed that when it was time to sign the Minutes, he was contacted by his uncle's lawyer, Ms. Chu, who asked if he could come to her office to sign the Minutes using the authority of the power of attorney. According to Dessisa, Ms. Chu advised that she would have to obtain authority from her client and sought Dessisa's advice as to the best time of day to contact him. At this time, the deceased was living in a long-term care facility. According to Dessisa's evidence, Ms. Chu contacted the deceased and then emailed Dessisa advising that she had authority from her client for him to sign the Minutes by way of power of attorney. Dessisa then signed the Minutes on July 20, 2018.

[29] The Family Court Application was also signed by Dessisa on February 27, 2018 using the power of attorney and utilizing the same type of authority from the deceased as obtained by Ms. Chu when Dessisa signed the Minutes.

[30] Demisie takes the position that the February 2017 will is not a valid testamentary instrument as it was executed under the undue influence of the Applicants. Her position is that Dessisa was angry that he was not appointed an Estate Trustee under the 2016 will and took steps to ensure that Demisie was cut out of his uncle's estate.

[31] At the time of executing the February 2017 will, the deceased lacked capacity and was heavily medicated and in need of 24-hour care.

[32] Demisie submitted that there were no issues between her and the deceased prior to January 22, 2017. She attended the hospital every day to care for him. She alleges that Dessisa influenced the deceased to sever the relationship, commence a Family Court Application and prepare a new will and powers of attorney.

Analysis

[33] There is no evidence to support that the deceased lacked capacity at the relevant times. Specifically, I find as follows.

[34] While I agree with Demisie's counsel that Mr. Wismer is not a capacity assessor, the March 30, 2017 letter is some evidence that [page269] the deceased's condition had improved and that his health care "team" assessed him as capable of directing his own care as of January 25, 2017. He was also described in that letter as "alert and lucid".

[35] There is no evidence that Ms. Chu, who attended on February 24, 2017 had any issues with the deceased's capacity to sign the will and power of attorney for property on that date. The evidence was that she was careful to question the deceased to ensure he knew what he was signing and that he was oriented as to time and place.

[36] There is no evidence that the lawyer who registered the transfer of Granger had any issue with the deceased's capacity to personally sign the Acknowledgement and Direction in March 2017.

[37] While it is not for this court to unravel what happened on January 22, 2017, it is clear that the relationship with Demisie was severed after that. The actions taken by the deceased, while competent, reflect an intention to pursue a separation. He had a new Will and Powers of Attorney prepared, he severed the Granger joint tenancy and in February 2018 he started formal court proceedings against Demisie.

[38] The deceased provided clear instructions to his bank to provide authority to Dessisa to pay his caregiving expenses.

[39] The affidavit evidence of Mr. Gibre-Hewit cannot be ignored. A long-time friend of the deceased, he attests to his competence at the time of execution of the Will.

[40] Dessisa's uncontradicted evidence was that Ms. Chu was careful to obtain specific instructions from her client before she accepted Dessisa's signature as power of attorney for the Minutes. There was no evidence that Ms. Chu has any issue with her client's capacity in July 2018, only his mobility.

[41] After January 22, 2017, Demisie had no further contact with the deceased. She is unable to provide any of her own evidence with respect to the circumstances surrounding the signing of the will, powers of attorney, transfer of Granger or the signing of the Family Law Application or Minutes. The only evidence the court has is that provided by the applicants.

[42] For all of the reasons set out above, I find that the deceased had capacity to sign his 2017 will, powers of attorney, transfer of Granger and the 2018 Family Court Application and Minutes.

2. The validity and effect of the Minutes of Settlement

[43] The Minutes signed by the deceased and Demisie in July 2018 cannot be ignored. While Demisie claims she did not understand [page270] what she was signing, that her lawyer did not explain the document to her and that her lawyer was in a rush, Demisie has not commenced a negligence action against the lawyer. She simply makes bald allegations in relation to a document which was comprehensive and negotiated with legal advice.

[44] The Minutes are very detailed. They contain a complete Miglin style release of spousal support. The parties agreed that each would be responsible for their own medical and dental expenses. The Minutes recite that the beneficiary of the Primerica Life Insurance policy would be changed to Dessisa.

[45] After obtaining an appraisal of Granger, the parties to the Minutes agreed that Demisie would buy out the deceased for $253,000 less $7,000 (being a notional cost of disposition). The payment was to be made within ten days. Demisie has never made the payment. She claims that the deceased did not live long enough for her to do so. Demisie was to continue paying the mortgage on Granger and use her best efforts to discharge it.

[46] Demisie was to receive a portion of the deceased's OMERS and OPTrust pension as well as 60 per cent of his CPP pension income.

[47] The Minutes also contain comprehensive releases including a release of any claim for a constructive or resulting trust and an agreement to renounce any entitlement either may have had in the other's will or for a share in the other's estate. The parties to the Minutes agreed to be bound by them, had independent legal advice, understood their rights and obligations and were signing the Minutes voluntarily.

[48] Demisie submits a concern that the Minutes were not actually signed by the deceased before his death but were signed by Dessisa using his power of attorney after the date of death.

[49] I reject this argument in its entirety. First, Dessisa's signature by way of his authority as attorney for property is dated July 20, 2018. Second, there is Dessisa's evidence under oath that Ms. Chu obtained authority directly from the deceased to allow Dessisa to sign. Finally, and most importantly, the terms of settlement offered by Ms. Chu were accepted by Demisie's counsel in writing on June 8, 2018. Even if Demisie's allegations about the signature are correct, the parties were bound by their lawyers' offer and acceptance of the settlement terms.

[50] In Olivieri v. Sherman (2007), 86 O.R. (3d) 778, [2007] O.J. No. 2598, 2007 ONCA 491, the court set out the requirements for enforcing a concluded settlement agreement. Such an analysis does not require an inquiry into the actual state of mind of one of the [page271] parties or a party's subjective intention, but must be measured by the objective reading of the language chosen by the parties to reflect their agreement (para. 44).

[51] I find, as per Olivieri (para. 41), that the parties had a mutual intention to create a legally binding contract; and reached an agreement on its essential terms.

[52] Given all of the above, I find that the Minutes were valid, enforceable and binding on both the deceased and Demisie.

3. Should the Notice of Objection be set aside?

[53] Pursuant to rule 25.11 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, the court may strike out all or part of a pleading, with or without leave to amend, on the ground that the pleading or other document,

-- may prejudice or delay the fair trial of the action;

-- is scandalous, frivolous or vexatious; or

-- is an abuse of process of the court.

[54] I find that the Notice of Objection in this case is frivolous and vexatious and must be struck out based on the findings set out below.

[55] First, Demisie has failed to adduce any evidence which would put the capacity of the deceased in question with respect to the will, powers of attorney, transfer of Granger or the Minutes. In fact, the evidence points to the deceased being physically weak but mentally alert throughout the relevant periods.

[56] Second, the evidence which has been adduced by Demisie on these points consists of bald allegations which are not supported or corroborated by any other evidence. Demisie is suspicious of Dessisa's motives, but that alone is insufficient to ground her Notice of Objection.

[57] Third, the Minutes, and their validity and enforceability cannot be ignored. The claims made by Demisie in her Notice of Objection are completely subsumed by the terms of the Minutes. She has released her right to any property of the deceased other than as set out in the Minutes, and specifically to any portion of his estate. Further, she has released her right to spousal support and to any ability to pursue a claim for a constructive or resulting trust. Even if she was correct about there being a lack of authority for Dessisa to sign on the deceased's behalf, Demisie was already bound by her lawyer's acceptance of opposing counsel's offer. [page272]

Orders

[58] Given the findings and analysis above, I make the following orders:

(1) The respondent's Notice of Objection dated March 19, 2019 shall be forthwith withdrawn.

(2) The applicants may apply for a Certificate of Appointment of Estate Trustee with a Will.

(3) The respondent shall cooperate with respect to the signing of any documentation required to effect the abovementioned orders.

Costs

[59] The applicants seek partial indemnity costs of $23,588. In September 2019, the applicants put the respondent on notice of their intention to seek costs. On November 26, 2019, the applicants served an Offer by way of a letter. The Offer required the respondent to withdraw her Notice of Objection, cooperate with the naming of the applicants as estate trustees, pay $30,000 in costs and pay $253,000 to the deceased's estate in accordance with the terms of the Minutes.

[60] The respondent if successful, sought costs of $19,308.

[61] The applicants have had complete success. They should have their partial indemnity costs as sought. The costs as set out in their bill of costs are reasonable and include disbursements of over $3,500 for cross-examinations and transcripts.

[62] Therefore, the respondent shall pay to the applicants the all-inclusive sum of $23,588 forthwith.

Motion allowed.

End of Document