Court File and Parties

Court File No.: CV-21-00668283-00ES Date: 20230911 Ontario Superior Court of Justice – Ontario (Estates List)

In the Estate of ANGELO VARIO, deceased

Between: ANTHONY VARIO and TINA VOLPENTESTA Applicants

And: MARIA VARIO Respondent

Before: Justice A.A. Sanfilippo

Counsel: R. Adam J. Pyne-Hilton, for the Moving Party Applicants No one appearing, for the Respondent

Heard (By video conference): August 25, 2023

Endorsement

[1] Angelo Vario died on February 12, 2013 (the “Deceased”). He was predeceased by his wife, Lucia Vario. He was survived by his three children, the Applicants Anthony Vario and Tina Volpentesta, and the Respondent, Maria Vario. At the time of his death, the Deceased resided at 2956 Kingston Road, Toronto (the “Property”), together with Maria. [^1]

[2] The Deceased left a Last Will and Testament dated October 22, 1996 (the “Will”).

[3] The Will appointed Maria as Estate Trustee. Maria applied for, and on December 4, 2013, was granted, a Certificate of Appointment of Estate Trustee with a Will (the “Certificate of Appointment”), appointing Maria as the Estate Trustee of the estate of Angelo Vario (the “Estate”).

[4] The Applicants, Anthony and Tina, brought this Motion to remove Maria as Estate Trustee and to appoint Anthony in her place. The Motion also sought an Order authorizing Anthony to sell the Property. This Motion was unopposed by Maria, who has not appeared in the Application or the Motion.

[5] For the reasons that follow, I grant the Order to remove Maria as Estate Trustee and to appoint Anthony as Estate Trustee. I dismiss the order sought to sell the Property because this relief is not supported by the record. This dismissal is without prejudice to the Applicants seeking this order within their Application.

Background

[6] Considering that Lucia died before the Deceased, the Will provides, in pertinent part, as follows:

(a) If Maria survives the Deceased, as she has, to hold the Property for Maria “until her death or until she decides to sell the [Property], whichever first occurs”. [^2] The parties do not dispute that Maria has a life interest in the Property.

(b) Upon Maria’s death or upon a sale of the Property, “the sum of ONE HUNDRED THOUSAND ($100,000.00) DOLLARS of the proceeds thereof shall be transferred to my daughter [Maria], for her own use absolutely, and the remainder of the proceeds and any accumulation of income thereon shall fall into the residue of my estate.” [^3]

(c) “The taxes, insurance, repairs, mortgage interest and any other charges or amounts necessary for the general upkeep of the [Property] shall be paid by my daughter [Maria].” [^4]

(d) The residue of the Estate shall be paid in equal one-third parts to Maria, Anthony and Tina. [^5]

[7] The evidence showed that at the time of the Deceased’s death, Maria, who has been unemployed since 1989, assisted the Deceased with daily routines, such as shopping, cooking and cleaning. Maria continues to reside in the Property, further to the life interest granted to her in the Will.

[8] On September 7, 2021, Anthony and Tina issued a Notice of Application because of their concern that Maria was failing to maintain the Property in good repair, in default of her obligations under paragraph 3(d)(ii) of the Will and as Estate Trustee. In the Notice of Application, Anthony and Tina sought the following:

(a) An Order requiring Maria to retain a licensed home inspector to complete an inspection of the Property.

(b) An Order requiring Maria to complete the repairs recommended in the home inspection report within 45 days of the completion of the report.

(c) An Order requiring Maria to provide Anthony and Tina with a copy of the valid home insurance policy for the Property.

(d) In the alternative, the Court’s opinion, advice or direction “respecting the ongoing life interest of Maria Stella Vario provided under the Last Will and Testament of Angelo Vario.”

[9] The Notice of Application was supported by Anthony’s affidavit, sworn July 13, 2021. Anthony deposed that he observed numerous safety concerns arising from the condition of the Property. The entrance tiles on the front veranda were damaged and dislodged, and the roof over the front porch was sagging. Anthony deposed that he learned that the bathrooms in the house were in a state of disrepair.

[10] On September 2, 2022, the Applicants brought their Application for a hearing before Justice Gilmore. The Applicants established that Maria was served with the Application Record in February 2022, and did not appear in the Application either properly through counsel, or even in person. [^6] Maria thereby had no standing in the Application.

[11] Justice Gilmore ordered as follows (the “September 2022 Order”): [^7]

(a) Maria shall permit a licensed home inspector retained by the Applicants to complete a property inspection report for the Property.

(b) Maria, as Estate Trustee, shall complete repairs of the deficiencies identified by the property inspection report.

(c) Maria shall provide the Respondents with a valid home insurance policy for the Property.

(d) In the event that Maria, as Estate Trustee, fails to comply with the terms of this Order, “the Applicants may bring a motion to the Court to compel a sale of the Property.”

[12] In an affidavit sworn February 28, 2023, Anthony deposed that he personally served Maria with the September 2022 Order and arranged for the home inspection to take place on October 15, 2022. The home inspection report, dated October 15, 2022, and authored by Brent Jeffreys on behalf of Classic Home Inspections Inc. (the “Inspection Report”) identified deficiencies in both the interior and exterior of the Property, including the following: [^8]

(a) The front entrance steps have completely deteriorated, are unsafe and must be rebuilt.

(b) There is a hole in the roof that allows wildlife, including raccoons, access to the attic and permits water to leak into the house, causing rot.

(c) The main floor bathroom was missing grout and has significant mold issues.

(d) The basement has mold and water damage, requiring waterproofing.

(e) A handrail is detached from the wall and spindles are missing, causing a safety hazard.

(f) The balcony over the garage is sagging.

[13] On June 7, 2023, the Applicants brought a Motion for an Order to sell the Property. In the supporting affidavit, Anthony deposed that “Maria does not appear to have completed any repairs of the deficiencies noted in the property inspection report”. This evidence was based solely on Anthony’s observations from driving by the Property. This was the only evidence filed by Anthony and Tina in support of the submission that Maria has failed to complete the repairs identified by the property inspection report. In my view, this evidence was insufficient to support the order sought by the Applicants for possession of the Property, and thereby severance of the life interest. I adjourned the Motion to provide the Applicants with an opportunity to file supplementary materials and a factum.

[14] The Applicants revised their Notice of Motion to seek the removal of Maria as Estate Trustee.

The Motion

[15] The Applicants seek the following relief in this Motion:

(a) A Declaration that Maria is in breach of the September 2022 Order, and her obligation to maintain the Property in good repair.

(b) An Order that Maria be removed as Estate Trustee.

(c) An Order that Anthony be appointed as Estate Trustee.

(d) An Order that Anthony, as Estate Trustee, shall have the authority to administer the Estate, “including but not limited to the sale, refinance, encumbrance and/or anything else that may or may not be required related to the [Property]”.

[16] In support of the Motion, the moving party Applicants filed Anthony’s affidavit sworn August 9, 2023. Maria did not appear on the Motion.

Breach of the September 2022 Order

[17] Anthony deposed that he attended the Property on August 7, 2023, and that Maria showed him that she had patched a hole in the roof and a hole in the soffit over the second-floor balcony. Anthony deposed, and established by exhibiting photographs taken that day, that there continues to be significant, long identified and uncorrected maintenance issues at the Property, including the following:

(a) The hole in the ceiling of an upstairs bedroom has exposed attic insulation and other debris, including animal dropping, that has fallen to the floor of the bedroom.

(b) The front entrance steps have almost entirely disintegrated and are a trip hazard for visitors to the Property.

(c) The stair railing leading downstairs remains broken and the spindles are sticking out, causing a trip hazard.

(d) Mold continues to appear in various places throughout the Property, including the basement kitchen, basement ceiling, basement return vent, first floor bathroom and second floor bathroom.

(e) The photographs show that the Property is in a general state of neglect and disrepair.

[18] Additionally, Anthony deposed that Maria did not provide a copy of a valid homeowner’s insurance policy, and that there was the potential that the Property was uninsurable in its current condition.

[19] The Applicant established that Maria breached paragraph 2 of the September 2022 Order by not completing the repairs to the Property identified by the Inspection Report within 45 days of it being served. [^9] The Applicants proved that they served Maria with a copy of the September 2022 Order on September 21, 2022, and a copy of the Inspection Report on October 21, 2022.

[20] The Applicants also established that Maria breached paragraph 3 of the September 2022 Order by failing to provide the Applicants with a copy of a valid home insurance policy within 30 days of being served with the September 2022 Order. [^10] Indeed, Anthony deposed that there is a strong likelihood that the Property is currently uninsured.

[21] A declaration shall therefore issue, unopposed, that the Respondent is in breach of the September 2022 Order.

Removal of the Estate Trustee

[22] The Court has inherent jurisdiction to remove trustees. [^11] Sections 5(1) and 37(1) of the Trustee Act, R.S.O. 1990, c. T.23, confirms the authority of the Court to remove an estate trustee and appoint another person to act in their place:

5(1) The Superior Court of Justice may make an order for the appointment of a new trustee or new trustees, either in substitution for or in addition to any existing trustee or trustees, or although there is no existing trustee.

37(1) The Superior Court of Justice may remove a personal representative upon any ground upon which the court may remove any other trustee, and may appoint some other proper person or persons to act in the place of the executor or administrator so removed.

[23] In accordance with s. 37(3) of the Trustee Act, an Application for removal may be brought by anyone with an interest in the estate. In their capacity as beneficiaries, the Applicants clearly have an interest in both the Deceased’s Estate and the status of the Property.

[24] There can be no doubt that the removal of an estate trustee, whom a deceased has chosen, is a serious matter. [^12] In considering the exercise of its discretion to remove an estate trustee, a Court will assess whether the Applicant has shown, on the clearest of evidence, that the removal is necessary for the welfare of the estate and its beneficiaries and whether the conduct of the trustee is endangering the administration of the estate. [^13]

[25] I find that the evidence established that the removal of Maria as Estate Trustee is necessary for the proper administration of the Deceased’s Estate, and the welfare of the Estate and its beneficiaries. The Property, being the principal asset of the Estate, is wasting. Maria is not taking sufficient steps to advance the administration of the Estate or preserve its assets, has breached the September 2022 Order, and has breached the provision of the Will requiring that she maintain and repair the Property.

[26] In Kasanda v. Sartarelli, 2023 ONSC 4400, the Court held that “past misconduct may justify removal if it is likely to continue in the future.” [^14] Here, the Respondent Estate Trustee has had ample time to comply with the September 2022 Order, and to take steps to preserve and maintain the Estate’s main asset. Maria’s continued failure to carry out her duties as Estate Trustee not only erode the value of the Estate, but also exposes the Estate to liability. Maria has failed to produce a homeowner’s insurance policy certificate insuring the Property against loss and third-party liability. This could expose the Estate to claims, particularly considering the failure to repair parts of the Property accessible to others, such as the front steps and porch.

[27] In the exercise of my discretion, and on the authority provided by the Trustee Act, an Order shall issue, unopposed, removing Maria as Estate Trustee. Pursuant to Rule 75.05, Maria shall return the Certificate of Appointment of Estate Trustee with a Will issued to her on December 4, 2013. Pursuant to Rule 75.04, the Certificate of Appointment of Estate Trustee with a Will issued by this Court to Maria on December 4, 2013, is hereby revoked.

[28] When a sole trustee is removed, the Court normally requires that a replacement trustee be appointed to ensure that the estate is continuously administered. [^15] The Applicants seek the appointment of Anthony as the replacement trustee.

[29] As the Court of Appeal explained in Gonder v. Gonder Estate, 2010 ONCA 172, the “role of a trustee is a difficult one” and the “trustee must act in the best interests of the beneficiary, even at personal hardship.” [^16] Anthony’s interest as a residual beneficiary would be realized sooner if the Property were sold, but Anthony’s duty as a trustee is to act in the best interests of all beneficiaries, which includes the protection and preservation of Maria’s life interest. Anthony submitted through counsel that he is committed to the preservation of the Property both for the purposes of Maria’s life interest and for the benefit of all three residual beneficiaries” Maria, Tina, and himself.

[30] I am mindful that the Estate principally has a single asset and that the appointment of an institutional estate trustee would erode the value of the asset. Considering that there is no evidence of liquid assets owned by the Estate, to fund an institutional estate trustee, the Property might need to be mortgaged or sold which could impair or impact the life interest. No institutional estate trustee has been identified as willing to accept this role. The Estate has, until now, been administered by a beneficiary. I accept Anthony’s submission that he is prepared to discharge the duties of an Estate trustee.

[31] An Order shall be issued appointing Anthony as the Estate Trustee in place of Maria. I order that Anthony bring a Motion for Directions within 60 days to advance the administration of the Estate, including seeking any Order required to advance the purposes of the Estate.

Sale of the Property

[32] The relief sought in the Motion for the sale of the Property was not established. The Applicants did not show how Maria’s life interest would be protected and addressed as part of the sale of the Property. More fundamentally, in my view, this relief is currently inconsistent with the remainder of the relief sought on this Motion. Anthony’s requested appointment to act as Estate Trustee encompasses duties that are inconsistent with the power to sell that was sought by the Applicants without consideration of Maria’s best interests.

[33] The order sought for the sale of the Property is dismissed, without prejudice to the Applicants seeking this Order within their Application.

Disposition

[34] On the basis of these reasons, I order:

(a) A Declaration shall issue that the Respondent, Maria Vario, is in breach of paragraphs 2 and 3 of the Order of Justice Gilmore dated September 2, 2022.

(b) The Respondent, Maria Vario, be and is hereby removed as Trustee of the Estate of Angelo Vario.

(c) The Applicant, Anthony Vario, be and is hereby appointed as replacement trustee of the Estate of Angelo Vario, without the necessity for a bond.

(d) The Respondent, Maria Vario, shall return the Certificate of Appointment of Estate Trustee with a Will issued to her on December 4, 2013.

(e) The Certificate of Appointment of Estate Trustee with a Will issued to Maria Vario on December 4, 2013, is hereby revoked.

(f) The order sought for the sale of the Property is dismissed, without prejudice to the Applicants seeking this Order within their Application.

(g) The Applicants shall bring a Motion for Directions within 60 days of this Order.

(h) The Applicants shall serve this Order, and the Endorsement, on the Respondent.

[35] The Applicants may file on the CaseLines bundle for this Motion, a form of Order that is consistent with the terms of this disposition and may then forward by email to my judicial assistant, versions of the draft Order in PDF and Word format for consideration.

Costs

[36] The Applicants sought costs of this Motion. The Applicants claimed costs on a substantial indemnity basis in the amount of $3,304.00, all-inclusive of fees, disbursements and applicable taxes. The Cost Outline established the basis for this amount of costs, and also showed that the costs on a partial indemnity basis were $2,309.75, all inclusive.

[37] The Applicants were successful on this Motion and are thereby entitled to an award of costs. The necessity for the Motion arose from the Respondent’s failure to comply with a Court Order, which compounded her failure to respond or cooperate in this Application notwithstanding her duties as Estate Trustee. I am therefore satisfied that costs shall be awarded on a substantial indemnity basis. The amount of the costs sought by the Applicants are reasonable, both in terms of the hourly rates and the amount of time incurred in advancing the Motion.

[38] Considering the Respondent’s circumstances, the Applicants submitted, in my view correctly, that the cost award should be payable forthwith but rather should be deducted from the specific and residual bequests to Maria under the Will. This mirrors the term for payment of the cost award rendered in the September 2022 Order.

[39] An Order shall issue that the Respondent, Maria Vario, pay the Applicants, Anthony Vario and Tina Volpentesta, costs of this Motion in the amount of $3,304.00, all-inclusive, to be deducted from the specific and residual bequests to Maria Vario under the Last Will and Testament of Angelo Vario, deceased.

Justice A.A. Sanfilippo Date: September 11, 2023

[^1]: For brevity and clarity, I will refer to the parties by their first names, respectfully. [^2]: Last Will and Testament of Angelo Vario, dated October 22, 1996, (the “Will”), Exhibit “A” to the affidavit of Anthony Vario sworn August 9, 2023, (the “Will”), at para. 3(d)(i). [^3]: The Will, at para. 3(d)(i). [^4]: The Will, at para. 3(d)(ii). [^5]: The Will, at para. 3(e). [^6]: Rule 15.01(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194: “A party to a proceeding who … acts in a representative capacity shall be represented by a lawyer.” [^7]: Order of Justice Gilmore issued September 2, 2022, Exhibit “B” to the Affidavit of Anthony Vario sworn August 9, 2023 (the “September 2022 Order”). [^8]: Inspection Report dated October 15, 2022, Exhibit “C” to the Affidavit of Anthony Vario sworn February 28, 2023; Exhibit “C” to the Affidavit of Anthony Vario sworn August 9, 2023. [^9]: September 2022 Order, paragraph 2: “THIS COURT ORDERS that the Estate Trustee, Maria Stella Vario, shall complete repairs of the deficiencies in the property inspection report noted in paragraph 1 above within forty-five (45) days of the date the property inspection report is delivered to the Respondent.” [^10]: September 2022 Order, paragraph 3: “THIS COURT FURTHER ORDERS that the Estate Trustee, Maria Stella Vario, shall provide to the Applicants a copy of a valid home insurance policy for the Property within thirty (30) days of the date of the Respondent’s receipt of this Order.” [^11]: St. Joseph's Health Centre v. Dzwiekowski, at para. 25 [St. Joseph’s Health Centre]; Gonder v. Gonder Estate, 2010 ONCA 172, [2010] O.J. No. 884, at para. 26 [Gonder]. [^12]: Di Santo v. Di Santo Estate, 2022 ONCA 671, 163 O.R. (3d) 732, at para. 8. [^13]: Ford v Mazman, 2019 ONSC 542, [2019] O.J. No. 327, at para. 20, citing Radford v Radford Estate (Ont. Sup. Ct.), at paras. 97-113; Walsh v Whitford, 2017 ONSC 4532, [2017] O.J. No. 3910, at para. 19; St. Joseph’s Health Centre, at para. 28: “The authorities are, I believe consistent in placing the emphasis on the future administration of the estate, and the risks to which it will be exposed if the trustee remains in office. The question is whether the trust estate is likely to be administered properly in accordance with the fiduciary duties of the trustee and with due regard to the interests and welfare of the beneficiaries. The sanction of removal is intended not to punish trustees for past misconduct but rather to protect the assets of the trust and the interests of the beneficiaries.” [^14]: Kasanda v. Sartarelli, 2023 ONSC 4400, [2023] O.J. No. 3427, at para. 8. [^15]: Gonder, at para. 27. [^16]: Gonder, at para. 22.