COURT FILE NO.: CV-16-68173

DATE: 2020/12/07

ONTARIO

SUPERIOR COURT OF JUSTICE

B E T W E E N:

DANIEL STEPHEN CLAYTON

Applicant

– and –

SHIRLEY VIOLET CLAYTON, KAREN ELIZABETH DAVIES and PATRICIA ANNE LEWINGTON in their capacity as TRUSTEES OF THE CLAYTON FAMILY TRUST

Respondents

Kathleen McDormand and Calvin Hancock, for the Applicant

Douglas D. Buchmayer and Joel Reinhardt, for the Respondents

HEARD: November 10, 2020, by ZOOM

RULING on MOTION

(Admissibility of Affidavit of Shirley Violet Clayton)

Introduction

[1] This application relates to the administration of the estate of Gerald Joseph Clayton (“the Estate”). The applicant (“Dan”) requests an order removing the trustees of two trusts that form part of the Estate (“the Trustees”). The Trustees are the three respondents: Dan’s mother (“Shirley”) and two sisters (“Pat” and “Karen”). The application is scheduled to be heard on January 14 and 15, 2021.

[2] As a preliminary matter, Dan brings this motion for an order striking the affidavit sworn by Shirley in June 2017 (“the Affidavit”). Dan requests that the Affidavit be struck in its entirety, without leave to amend.

[3] The Affidavit is one of many affidavits exchanged by the parties on this application. Affidavits were first served in 2016; service of affidavits continued into 2019. Cross-examinations were conducted in late 2019 and early 2020. At that time, the application was scheduled to be heard in April 2020. As a result of the pandemic, the application was adjourned and, as noted above, is now scheduled to be heard in January 2021.

[4] Pursuant to a notice of cross-examination served in November 2019, Shirley was to be cross-examined on November 22, 2019. On November 21, 2019, prior to the commencement of cross-examinations generally, respondents’ counsel advised Dan’s counsel that Shirley would not be produced for cross-examination the following day. The reason given for the inability to produce Shirley for cross-examination was concerns about her capacity. Shirley was not produced for cross-examination on November 22, 2019. No notice to cross-examine Shirley on a subsequent date was served.

[5] Dan submits that permitting the respondents to rely on the Affidavit is prejudicial to a fair hearing of the application. In the alternative, he submits that it is an abuse of process for the respondents to attempt to rely on the Affidavit.

[6] The respondents deny that their reliance on the Affidavit is either unfair or an abuse of process. The respondents submit that Dan was not denied an opportunity to cross-examine Shirley; rather, Dan failed to pursue cross-examination of Shirley, including by methods alternative to an in-person, oral cross-examination. The respondents argue that the Affidavit should be admitted as evidence, with the lack of cross-examination considered by the court as a factor in determining the weight to be given to Shirley’s evidence as part of the court’s ruling on the application.

Disposition

[7] For the reasons that follow I agree with the respondents. The motion to strike the Affidavit is dismissed.

Background

[8] In support of his position on the motion, Dan relies on what he describes as the respondents’ failure to,

a) give him notice, prior to November 21, 2019, of concerns that had arisen with respect to Shirley’s capacity, and

b) arrange for an assessment of Shirley’s capacity to be completed in a timely manner following November 21, 2019.

[9] I shall deal first with events prior to November 21, 2019 and then with events subsequent to that date.

a) Prior to November 21, 2019

[10] The evidence about Shirley’s physical and cognitive condition is found in (a) the transcript from Karen’s cross-examination conducted on January 2, 2020, and (b) letters from three healthcare professionals enclosed with the December 20, 2019 Gowling letter addressed to BLG.[^1] The letters are from Shirley’s family physician, a Registered Nurse who provided in-home services to Shirley in Canada, and a Registered Nurse who provided in-home care to Shirley in Florida during winter months.

[11] The December 20, 2019 Gowling letter, including the enclosures, is attached as an exhibit to the affidavit filed in support of the motion. That affidavit is from a practice assistant at BLG. The same letter, including the enclosures, is attached as an exhibit to the affidavit from a Gowling law clerk filed in response to the motion.

[12] What, if anything, is the court entitled to make of the information set out in the letters from the health professionals? Is direct evidence required from the health professionals? I find that it is not. The court is entitled to consider the information from the health professionals with respect to their observations of Shirley’s condition over time: Mohanadh v. Thillainathan, 2010 ONSC 2678, at para. 8.[^2]

[13] Based on Karen’s evidence on cross-examination and the letters from the health professionals, I make the following findings with respect to Shirley’s cognitive condition in 2018 and 2019 (the latter to November 21, 2019):

• From the Spring of 2018 to the Fall of 2018, Shirley was observed to suffer a decline in her memory of day-to-day events and from minor confusion. As an example of the latter, Shirley was at times confused about how to turn the television on and off and how to adjust its volume;

• The concerns about a decline in Shirley’s memory and cognitive abilities and an increase in Shirley’s level of confusion persisted in the Winter of 2018-19. Further decline in Shirley’s overall cognitive abilities was evident by the Spring of 2019, when Shirley returned to Canada from Florida; and

• By the Fall of 2019, Shirley’s cognitive decline was of concern to Shirley’s family physician of 27 years. He referred Shirley for a geriatric assessment.

[14] The respondents acknowledge that, they did not, at any time prior to November 21, 2019, give notice to the applicant of any concerns regarding Shirley’s cognitive abilities or capacity. Taking into consideration the chronology of this proceeding, there were several opportunities for the respondents to give notice of those concerns. Those opportunities include,

• at the January 2019 case conference before Master Kaufman, at which a timetable was set for the exchange of affidavits, cross-examinations, and the hearing of the application, and

• in the late Spring of 2019, when the respondents notified the applicant of their intention to file additional affidavits. That step was taken after the deadline for service of the applicant’s reply evidence and required the applicant’s consent to a revision of the timetable set by Master Kaufman at the January 2019 case conference.

[15] With respect to the second bullet point above, in a letter dated June 4, 2019, Gowling advised BLG of its intention to serve two additional affidavits in response to the motion. Gowling also addressed the revision of the timetable set by Master Kaufman. In the June 4, 2019 letter, Gowling mentioned Shirley’s cross-examination:

In regard to Shirley Clayton, we are content with you not waiving your right to cross-examine her, but simply to proceed by written questions due to her fragile health. If you deem cross-examination to be required after that, arrangements that accommodate her physical needs could be explored. Please confirm of [sic] this is agreeable for the examination of Ms. Clayton.

[16] There is no specific mention, in the June 4, 2019 Gowling letter, of concerns with respect to Shirley’s cognitive condition and/or capacity. It is, however, clear that as of late Spring of 2019, the applicant was given notice of concerns that existed with respect to Shirley’s ability to handle cross-examination in the usual manner.

[17] There is no evidence that, prior to the commencement of cross-examinations, an agreement was pursued by BLG or reached between counsel that Shirley’s cross-examination would include any form of accommodation with respect to her “fragile health” or “physical needs”.[^3]

[18] In November 2019, counsel travelled to Guelph, Ontario for cross-examinations of a number of affiants, including Shirley, from that area of the province. Cross-examinations commenced on November 21, 2019, with Shirley scheduled to be cross-examined on November 22, 2019. It is undisputed that Shirley was properly served with a notice of cross-examination for that event.

[19] An off-the-record discussion between counsel about Shirley, on November 21, 2019, is reflected in a statement made on the record by respondents’ counsel at the outset of the cross-examination of a non-party:

[T]here are concerns that have arisen in [Shirley’s] preparation around the issue of capacity, and counsel have agreed that the respondents will have 30 days to determine their instructions and position related to Shirley Clayton’s status as a witness in the case and issue around her party status as well. And so, that will be provided to counsel for the applicant by counsel for the respondents within 30 days of today in order to determine how the parties will move ahead in respect of Shirley Clayton’s participation in this case.[^4]

[20] Respondents’ counsel thereafter set out her client’s position, including with respect to the Affidavit:

[W]e’ve asked for the position of Shirley Clayton with respect to whether she can be a trustee in light of the suspected incapacity, whether she can instruct counsel, what will happen with her affidavit, given that we won’t be able to test it – test her evidence if she is incapable. If she is – if she regains capacity or if she is capable, there would be an issue of costs regarding rescheduling of the cross-examination. And there … may be other issues, but those are the issues of concern.[^5]

[21] Subsequent to November 21, 2019, counsel continued to communicate with respect to the Affidavit, cross-examination of Shirley, and whether the Affidavit is admissible on this application.

b) After November 21, 2019

[22] Dan did not obtain a certificate of non-attendance with respect to Shirley’s cross-examination scheduled for November 22, 2019. In the weeks thereafter, counsel communicated by email and letter, setting out their respective clients’ positions arising from the concerns with respect to Shirley’s capacity.

[23] Since November 21, 2019, the respondents have maintained their position that the Affidavit is admissible on the application, even if Shirley is not subject to cross-examination. That position is repeatedly set out in correspondence from Gowling to BLG.[^6]

[24] Initially, Dan took the position that, in light of concerns about Shirley’s capacity, cross-examinations scheduled to continue in early January 2020 had to be postponed. His position included that it was necessary to seek directions from the court as to the admissibility of the Affidavit before cross-examinations could continue.[^7] At issue, according to Dan, was the fairness of the process.

[25] The respondents disagreed with delaying the cross-examinations pending a ruling with respect to admissibility of the Affidavit. In a Gowling letter dated December 24, 2019, addressed to BLG, the respondents maintained their position that the Affidavit is admissible on the application even if Shirley is not cross-examined. The respondents proposed that the following steps be taken if Dan continued to insist that a ruling on admissibility of the Affidavit were required before cross-examinations continued:

• The parties would schedule an urgent conference to put in place procedural steps to address the issues, including setting a tentative schedule for any hearings required;

• An assessment of Shirley’s capacity to be cross-examined would be arranged, and the results of that assessment produced. Efforts would be made to have the assessment conducted so that the results would be available for the urgent case conference; and

• The applicant would be entitled to rely on the results of the assessment when seeking directions from the court with respect to the admissibility of the Affidavit.

[26] Ultimately, and out of concern to avoid further delay of the hearing, Dan chose to proceed with the cross-examinations scheduled for early January 2020. He did so, however, on the following condition, as expressed by his counsel:

[W]e agree that the trustees should also be seeking guidance from a geriatric specialist regarding Shirley’s health, whether she has the capacity to continue as a trustee, and whether she will require a litigation guardian. We note that the trustees have already had over a month to obtain such an assessment since the potential issue regarding Shirley’s cognitive decline was first raised with us, but have not yet done so. Further, they have had more than a year to have an assessment conducted since concerns regarding Shirley’s cognitive abilities were apparently first reported by her care providers. It is very concerned [sic] that someone who is alleged to be incapable and to have been cognitively impaired for more than a year has continued to be acting [sic] as a trustee. As your clients are no doubt aware, persons who are incapable are not permitted to act as trustees.[^8]

[27] The cross-examinations scheduled for early January 2020 proceeded. At the outset of both Dan’s cross-examination and the cross-examination of a non-party affiant, Dan’s counsel stated on the record a blanket objection to questions related to the contents of the Affidavit.

[28] Leaving aside the parties’ different views on the admissibility of the Affidavit, and how concerns about Shirley’s capacity impact the process, the parties agreed on one matter. They agreed that an assessment of Shirley’s capacity was required for two reasons. It was necessary (a) procedurally, with respect to cross-examination, and (b) substantively, in the context of assessing Shirley’s ability, or inability, to fulfill her role as one of the Trustees.

[29] In their December 24, 2019 letter, Gowling undertook to advise BLG of the details of the assessment, once they were known from either the family physician or the geriatric specialist. When Karen was cross-examined in early 2020, some details about the assessment were provided.

[30] In her evidence, Karen explained that the respondents turned down a December 2019 date offered for the assessment. They did so because (a) Shirley had plans to travel to Florida, (b) Pat and Karen both also had plans to be travelling, and (c) the assessor(s) wanted Pat and Karen to be present for feedback. As of early January 2020, when Karen was cross-examined, a geriatric assessment was scheduled for May 15, 2020.

[31] As of late 2019 and early 2020, the application was scheduled to be heard in early April 2020. Dan is critical of the respondents for failing, in that context, to accept the December 2019 appointment offered for the assessment. In the end, the April 2020 return date was cancelled because of COVID-19. The application was rescheduled: initially, to a date in September 2020; and ultimately, to January 14 and 15, 2021.

[32] Also because of COVID-19, the geriatric assessment did not proceed in May 2020. In their September 17, 2020 letter, Gowling advised BLG that the assessment had, because of COVID-19, been rescheduled to a date in the Fall of 2020. If that assessment has since taken place, the date on which it took place and the results of it are not in evidence before the court.

[33] There is no evidence before the court of communication between counsel – from January 2020 (when the cross-examinations continued) and June 2020 – about the Affidavit or, for that matter, Dan’s application. There is, however, evidence of communication between counsel in June, July, August, and September 2020 about the application on Shirley’s behalf addressing her removal as one of the Trustees. That application was commenced in 2020.

[34] In a September 11, 2020 letter addressed to Gowling, BLG once again raised the issue of Shirley’s affidavit evidence. BLG referred to its previous correspondence and reiterated Dan’s position with respect to the Affidavit:

I am writing in respect of the removal application that is scheduled to be heard on September 30, 2020.

In particular, I am writing to request confirmation that any affidavits sworn by Shirley Violet Clayton (“Shirley”) have not been and will not be filed with the court in connection with the removal application.

Please confirm that Shirley’s Affidavit will be removed from the record that the trustees file with the court in light of her incapacity and your refusal to permit us to cross examine Ms. Clayton. Should the trustees insist on placing the affidavit from Shirley into evidence, we will object to the introduction of the affidavit into evidence and will rely on this correspondence.

[35] The parties appeared before the court in late September 2020 on the return date for this application. The matter was adjourned (a) because counsel had not booked sufficient time for the court to hear both this application and the removal application, and (b) to permit Dan to bring this motion.

The Issues

[36] In support of his request for the Affidavit to be struck, in its entirety and without leave to amend, Dan relies on subrules 25.11(a) and (c) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194. Therefore, the issues to be determined on the motion are as follows:

1. Would the admission of the Affidavit as evidence on this application be prejudicial to the fairness of the hearing (r. 25.11(a))?

2. Would the admission of the Affidavit as evidence on this application constitute an abuse of process (r. 25.11(c))?

3. If the answer to one or both of questions 1 and 2 is “Yes”, should the Affidavit be struck in its entirety without leave to amend?

Issue No. 1 – Would the admission of the Affidavit as evidence on this application be prejudicial to the fairness of the hearing?

a) Positions of the Parties

[37] Dan requests that the court draw an inference and find that it was either a tactical or strategic decision on the part of the respondents to (a) delay in notifying him of concerns about Shirley’s capacity, and (b) turn down the December 2019 assessment appointment, when the respondents knew that the application was scheduled for April 2020. Dan submits that, even if the court does not draw the inference requested, it would be unfair to permit the respondents to rely on the Affidavit for the purpose of this application.

[38] The respondents’ position is that it is not unfair to Dan if the Affidavit is admitted as evidence. The respondents highlight that Dan,

• did not obtain and does not rely on a certificate of non-attendance with respect to the cross-examination scheduled for November 22, 2019,

• did not avail himself of the opportunity to cross-examine Shirley, by an alternative method if necessary, as offered in the December 24, 2019 Gowling letter, and

• did not seek assistance from the court for directions and/or a ruling even though it was repeatedly stated that he would do so.

[39] The respondents submit that the fairness of the proceeding is not affected by the admission of the Affidavit; the court will, on the application and in the context of the complete record, determine the weight to be given to the Affidavit.

b) Analysis

[40] Subrule 25.11(a) provides that “[t]he court may strike out or expunge all or part of a pleading or other document, with or without leave to amend, on the ground that the pleading or other document, (a) may prejudice or delay the fair trial of the action”. This rule applies, with the necessary modifications, with respect to any document filed on an application: r. 38.12.

[41] I find that the admission of the Affidavit is not prejudicial to the fairness of the proceeding. I do so for the following reasons.

[42] First, I am not prepared to (a) draw the inference requested, or (b) find that the respondents have, with respect to Shirley’s capacity to be cross-examined and the assessment of it, made deliberate tactical or strategic decisions. The evidence simply does not support such an inference.

[43] Second, the delay of the assessment appointment, from December 2019 to the Spring of 2020, did not contribute to a delay in hearing the application. As it turned out, the application was adjourned indefinitely as a result of COVID-19.

[44] Third, Dan did not take any steps, prior to bringing this motion, to seek the assistance of the court in determining the steps required to address concerns with respect to the Affidavit and whether Shirley could be cross-examined.

[45] Fourth, Dan did not avail himself of the opportunity to proceed as proposed in the December 24, 2019 Gowling letter. Pursuing that opportunity might have required Dan to accept that Shirley’s cross-examination, if conducted, would include some accommodation for her physical and/or cognitive limitations.

[46] The proposal made in the December 24, 2019 Gowling letter is in keeping with the process for cross-examination ordered by Master Kaufman in Arnold v. Arnold, 2019 ONSC 6097. While there are some distinctions between the facts in Arnold and those before the court on this motion, there is one striking similarity between the two matters. In neither matter did the affiant refuse to present herself for cross-examination: Arnold, at para. 25.

[47] In addressing the concerns with respect to Shirley’s capacity to be cross-examined, Dan chose an all-or-nothing approach. As a result of that choice, Dan now finds himself two months from the return date of his application without the benefit, if feasible, of cross-examination on the Affidavit.

[48] The issue of fairness to the parties must also be considered in light of the court’s authority to control its own process. Dan has a prima facie right to cross-examine Shirley on the Affidavit. In controlling its own process, however, the court has the discretion to prevent or limit cross-examination where it is in the interests of justice to do so: Canada (Attorney General) v. Mennes, 2014 ONCA 690, 122 O.R. (3d) 434, at para. 27.

[49] The application has already been adjourned three times – from 2019 to 2020, from the Spring of 2020 to the Fall of 2020, and from the Fall of 2020 to January 2021. The BLG letters are replete with expressions of Dan’s desire not to see the application adjourned. On neither of the September 2020 return date for this application nor the date on which this motion was argued, did Dan suggest that this application be adjourned to permit cross-examination of Shirley.

[50] I am seized of the matter and scheduled to hear the application on January 14 and 15, 2021. I find that it is fair to both the process and the parties to admit the Affidavit and leave the issue of the weight to be given to Shirley’s evidence to be determined with the benefit of the complete record. Justice D.M. Brown, as he then was, took that approach in 1196303 Ontario Inc. v. Glen Grove Suites Inc., 2013 ONSC 7284, 94 E.T.R. (3d) 73, at para. 46, rev’d on other grounds 2015 ONCA 580, 9 E.T.R. (4th) 173.

[51] On the return of the application, it will be necessary for the parties to make submissions with respect to the weight to be given to Shirley’s affidavit evidence.

[52] In summary, I find that admitting the Affidavit is not prejudicial to the fairness of the application. The answer to the first question posed by the court is “No”.

Issue No. 2 – Would the admission of the Affidavit as evidence on this application constitute an abuse of process?

a) Positions of the Parties

[53] The applicant’s position is that it would be an abuse of process to admit the Affidavit as evidence on this application.

[54] In support of their position that the admission of the Affidavit does not constitute an abuse of process, the respondents point to its substantive contents. The respondents highlight that, in her affidavit, Shirley addresses her concerns, beliefs, and opinions as they relate to the exercise of discretion in her role as one of the Trustees. They submit that the court requires this type of evidence to determine the issues on the application.

b) Analysis

[55] Subrule 25.11(c) provides that “[t]he court may strike out or expunge all or part of a pleading or other document, with or without leave to amend, on the ground that the pleading or other document … (c) is an abuse of the process of the court”. Once again, that subrule applies, with necessary modifications, on an application: r. 38.12.

[56] The applicant’s focus, both in the factum filed and the submissions made on his behalf, is on the issue of fairness. In the “Law and Argument” section of the applicant’s factum, the issue of abuse of process is addressed in the most general of terms. One of the sub-headings within that section of the applicant’s factum relates to protection of the fairness of the hearing. There is no sub-heading addressing abuse of process. The applicant did not provide the court with any authority in the case law in support of his position on the issue of abuse of process.

[57] I turn, then, to the contents of the Affidavit. In it, Shirley provides what she describes as “some explanation of how and why [she] and Gerry have treated [Dan] differently from Karen and Pat, both before Gerry’s death in June 2002, and since then.”[^9] In summary, Shirley describes what each of Dan, Pat, and Karen were like growing up; Dan’s behaviour as a teenager; Dan’s personal, financial, and marital struggles; and the financial support provided over time to Dan, his children, and at least one of Dan’s three ex-wives.

[58] I agree with the submission on behalf of the respondents that the basis for a trustee’s exercise of their discretion is relevant in determining the issues on a removal application: Martin v. Banting (2001), 37 E.T.R. (2d) 270 (Ont. S.C.), aff’d (2002), 46 E.T.R. (2d) 93 (Ont. C.A.). I find that the substantive contents of the Affidavit are not, in and of themselves, an abuse of process.

[59] The approach taken by Brown J. in 1196303 Ontario Inc., and described in para. 50, above, addresses both the issue of fairness and any potential for abuse of the proceeding. Although the Affidavit is admitted on the hearing, the parties will have the opportunity to make submissions with respect to the weight to be given to Shirley’s evidence. That approach permits the court to control the process and avoid an abuse of it.

[60] In summary, I find that admitting the Affidavit is not an abuse of process. The answer to the second question posed by the court is “No”.

Issue No. 3 – If the answer to one or both of questions 1 and 2 is “yes”, is the Affidavit to be struck in its entirety without leave to amend?

[61] The answer to both questions 1 and 2 is “No”. It is therefore unnecessary to consider Issue No. 3.

Disposition

[62] The applicant’s motion is dismissed. Costs of the motion shall be determined as part of the costs of this application.

Madam Justice Sylvia Corthorn

Released: December 7, 2020

COURT FILE NO.: CV-16-68173

DATE: 2020/12/07

ONTARIO

SUPERIOR COURT OF JUSTICE

B E T W E E N:

DANIEL STEPHEN CLAYTON

Applicant

– and –

SHIRLEY VIOLET CLAYTON, KAREN ELIZABETH DAVIES and PATRICIA ANNE LEWINGTON in their capacity as TRUSTEES OF THE CLAYTON FAMILY TRUST

Respondents

RULING on MOTION

(Admissibility of Affidavit of Shirley Violet Clayton)

Madam Justice Sylvia Corthorn

Released: December 7, 2020

[^1]: The applicant is represented by Borden Ladner Gervais LLP and the respondents by Gowling WLG. For ease of reference throughout this ruling, the firms and counsel are referred to as “BLG” and “Gowling”, respectively. [^2]: Although not precisely on point, the decision in Mohanadh is, by analogy, applicable to the matter before this court. [^3]: The terms in quotation marks are from the June 4, 2019 Gowling letter. [^4]: Transcript from cross-examination of B.F. Shostack on November 21, 2019, at p. 1. [^5]: Ibid., at p. 2. [^6]: See e.g., the December 20, 2019 Gowling letter addressed to BLG. [^7]: See the December 23, 2019 BLG letter addressed to Gowling. [^8]: December 30, 2019 BLG letter addressed to Gowling. [^9]: The Affidavit, at para. 2.