Court File and Parties
COURT FILE NO.: CV-19-113-ES & CV-19- 900 DATE: 2024/10/25 SUPERIOR COURT OF JUSTICE – ONTARIO
COURT FILE NO.: CV-19-113-ES RE: Bishop Moussa Ad Emile Girgis, Applicant AND: Sarwat Mansour in His Capacity as Estate Trustee for the Estate of Sidky Nassif, Deceased and Samia Messieh, in Her Capacity as Estate Trustee for the Estate of Shoukry Nassif Messieh, Deceased, Respondents
COURT FILE NO.: CV-19-900 RE: Sarwat Mansour in His Capacity as Estate Trustee for the Estate of Sidky Nassif, Deceased, Applicants AND: Bishop Moussa Ad Emile Girgis and Samia Messieh, in Her Capacity as Estate Trustee for the Estate of Shoukry Nassif Messieh, Deceased, Respondents
BEFORE: The Honourable Justice I.R. Smith
COUNSEL: Mark Ross and Eric Brousseau, Counsel for the Applicant, Bishop Moussa Ad Emile Girgis in File No.: CV-19-113-ES, and for the Respondent in File No.: CV-19-900 Sean Lawler, Counsel for the Applicant, Sarwat Mansour in File No.: CV-19-900 Mark Rodenburg, Counsel for the Respondent, Sarwat Mansour in File No.: CV-19-113-ES David Thompson and Brianne Powell, Counsel for the Respondent, Samia Messieh in File No.: CV-19-113-ES
HEARD: In Writing
Costs Endorsement
Introduction
1The applicant Bishop Moussa applied to the court for an interpretation of the will of one Sidky Nassif. The applicant Sarwat Mansour brought an application for the rectification of that same will. I heard both applications together. In reasons found at 2024 ONSC 1611, I dismissed the interpretation application and granted the rectification application.
2Bishop Moussa’s interpretation application was resisted by the estate trustee, Mr. Mansour, and by Ms. Messieh, in her capacity as the trustee for the estate of her late husband, Shoukry Messieh, who was one of the beneficiaries of Mr. Nassif’s will. The rectification application was launched in the name of Mr. Mansour by counsel for Mr. Jean Levesque, the solicitor who drafted the will in question and who asserted that the will contained an obvious drafting error that, when corrected, would ensure that Mr. Nassif’s intentions were carried out. The rectification application was resisted by Bishop Moussa. Ms. Messieh took the position that rectification was unnecessary but, in the alternative, supported the conclusion urged by Mr. Levesque on behalf of Mr. Mansour.
3In the end, as I have said, the interpretation application was dismissed. Bishop Moussa’s position on that application was not accepted, although neither were the positions of Mr. Mansour and Ms. Messieh. The rectification application was granted. On that application, the argument of Mr. Levesque on behalf of Mr. Mansour and supported by Ms. Messieh, was accepted. The position of Bishop Moussa was also rejected on the rectification application.
4In the result, the estate of Shoukry Messieh will be the beneficiary of the chief asset of Mr. Nassif’s estate, the proceeds of the sale of a house (the “house”), totalling $270,528.01.
Discussion
5The questions before me now relate to costs: to whom should they be awarded and who should pay?
6Gillese J.A. explained the proper approach to costs decisions in estates matters in her judgment in McDougald Estate v. Gooderham (2005), 2005 ONCA 909, 255 D.L.R. (4th) 435 (Ont. C.A.), at paras. 78–80:
The practice of the English courts, in estate litigation, is to order the costs of all parties to be paid out of the estate where the litigation arose as a result of the actions of the testator, or those with an interest in the residue of the estate, or where the litigation was reasonably necessary to ensure the proper administration of the estate. Public policy considerations underlie this approach: it is important that courts give effect to valid wills that reflect the intention of competent testators. Where the difficulties or ambiguities that give rise to the litigation are caused, in whole or in part, by the testator, it seems appropriate that the testator, through his or her estate, bear the costs of their resolution. If there are reasonable grounds upon which to question the execution of the will or the testator’s capacity in making the will, it is again in the public interest that such questions be resolved without cost to those questioning the will’s validity.
Traditionally, Canadian courts of first instance have followed the approach of the English courts. While the principle was that costs of all parties were ordered payable out of the estate if the dispute arose from an ambiguity or omission in the testator’s will or other conduct of the testator, or there were reasonable grounds upon which to question the will’s validity, such cost awards became virtually automatic.
However, the traditional approach has been – in my view, correctly – displaced. The modern approach to fixing costs in estate litigation is to carefully scrutinize the litigation and, unless the court finds that one or more of the public policy considerations set out above applies, to follow the costs rules that apply in civil litigation. … [Citations omitted; emphasis added.]
See also Swadon Estate v. Swadon, 2014 ONCA 101, at para. 99.
7In this case, the wording of the will was the cause of confusion about its meaning. On the interpretation application, Bishop Moussa, Ms. Messieh and Mr. Mansour offered three competing interpretations of the will as it was drafted. Mr. Levesque, however, offered a different argument on the rectification application. He said that he had simply made a mistake when trying to reflect the testator’s instructions in the will. Once that mistake is identified, both the intentions of the testator and the meaning of the will are obvious and sensible. The interpretations offered on the interpretation application are not.
8I agreed with the argument made by Mr. Levesque on behalf of Mr. Mansour, and rejected the competing interpretations offered by the parties on the interpretation application.
9With respect to Bishop Moussa’s position, I wrote as follows, at para. 46 of my reasons for judgment:
It strikes me that this interpretation provides for differing dispositions of the house based on little more than happenstance. If this was in fact the intention of Mr. Nassif, it seems an intention based on caprice rather than reason – which leads me to conclude that it was not his intention. Why would Mr. Nassif want his brother to have ownership of the house if his sister did not want to use it, but not if she died and could no longer use it? Why would Mr. Nassif want the needy Coptic Christians of Egypt to have the benefit of the house if Ms. Nassif died, but not if she no longer wanted to use it? It seems to me that it is very unlikely that these strange dichotomies were intended by Mr. Nassif and that this reading of the final will leads to an absurdity. A reading of the final will which is not absurd is that it simply contains an obvious mistake in drafting which, had it not been made, would have made it plain that the house was to be transferred to Mr. Messieh when his and Mr. Nassif’s sister was no longer using it, either because she did not want to use it or because she had died.
10I accept that the drafting mistake required the parties to get legal advice about the meaning of the will and that such advice is properly paid for by the estate. However, I adopt the submission of counsel for the applicant on the rectification application that the advice required by the estate trustee and by the beneficiaries need not have been extensive given that it should have been clear that the cause of the interpretive problem was a simple drafting error. In other words, the “public policy considerations” at play in this case should have been resolved efficiently and relatively inexpensively for the estate.
11Instead, the case became a private contest between Bishop Moussa and Ms. Messieh for the proceeds of the sale of the house. In such a contest, the court should “follow the costs rules that apply in civil litigation” (McDougald Estate, at para. 80). I reject the submission of Bishop Moussa that because the initial problem was caused by the testator and his solicitor, that every cost incurred thereafter is rightly paid by the estate. McDougald Estate directs me to scrutinize the litigation carefully and, in this case, such scrutiny leads to the conclusion that the public policy considerations raised by the drafting error ought to have been resolved at a low cost to all concerned, and that instead Bishop Moussa pursued an argument based on a reading of the final will that, to quote my reasons at para. 46, “leads to an absurdity.” Advancing such an argument and losing should properly lead to costs consequences. This approach to costs imposes discipline on litigants in estates matters and forces them to assess the merits of their positions knowing that a negative costs award may be made against them: Bilek v. Salter Estate (2009), 2009 ONSC 3400, 50 E.T.R. (3d) 227 (Ont. S.C.J.), at para. 6.
12In this case, this means that Bishop Moussa as the losing party should bear the costs of the litigation, apart from some allowance for advice respecting the public policy issue presented by the drafting error. The necessary corollary conclusion is that a blended costs award should be made in favour of Ms. Messieh who, like Bishop Moussa, should be compensated to some extent by the estate given the drafting error and, as the successful party, by Bishop Moussa, the losing party. [1]
13A blended award should also be made in favour of the estate trustee, Mr. Mansour, who is entitled to be fully indemnified for any legal fees reasonably incurred (Geffen v. Goodman Estate, [1991] 2 S.C.R. 353). Some portion of his costs will be paid by the estate and some portion by Bishop Moussa.
14Although the rectification application was brought in Mr. Mansour’s name, that application was initiated by counsel for Mr. Levesque, Mr. Lawler, and funded by Mr. Levesque’s insurer. Costs incurred by Mr. Lawler are sought on a partial indemnity basis as against Bishop Moussa. The balance of those costs is not sought from the estate. I agree that this is appropriate in the circumstances of this case.
15I also agree with the submission of counsel for Mr. Levesque that there is no cause for costs against Mr. Levesque. He is not a party to this litigation. Whether his drafting error was a breach of any duty and, if so, to whom that duty was owed, and whether the error resulted in damages payable to anyone, and in what amount, are all questions for another day and are not before me.
16Before I turn to the orders to be made, two further issues require consideration.
17First, as I have said, some allowance must be made for costs to be paid by the estate for each of Bishop Moussa, Ms. Messieh and Mr. Mansour, given the public policy considerations arising from the drafting error. Counsel for Mr. Levesque submits that the amount of that allowance for Bishop Moussa and Ms. Messieh should be the same – $5,000.00 each – and that the allowance for the estate trustee should be $10,000.00. Although these amounts are estimates of what would have been the legal costs of rectifying the will without litigation, I agree that they are reasonable. As Mr. Lawler put it in his written submissions: “This should have been a $20,000 problem (in total), i.e. : the Estate should have had to spend $10,000 to repair the mistake, and each of the two competing beneficiaries should have had to spend $5,000 to obtain legal advice.”
18To account for these allowances, the costs payable by Bishop Moussa to Mr. Mansour, the estate trustee will be reduced by $15,000.00 (comprised of the $10,000.00 rectification allowance for the estate and Bishop Moussa’s own $5,000.00 allowance), and the costs payable by Bishop Moussa to Ms. Messieh will be reduced by Ms. Messieh’s $5,000.00 allowance. Mr. Mansour will be made whole by the estate for these allowances, and Ms. Messieh’s allowance need not otherwise be accounted for as she will be the beneficiary of the residue of the proceeds of the house in any event.
19Second, Ms. Messieh made an offer to settle which offer, had it been accepted, would have been more favourable to Bishop Moussa than the result of the applications as I decided them. Even though that offer was made before the rectification application was launched, its acceptance would have made the rectification application unnecessary. Costs payable to Ms. Messieh by Bishop Moussa, then, will be payable on a substantial indemnity basis from the date of her offer.
Costs Conclusions
From Bishop Moussa to Ms. Messieh
20Bishop Moussa will pay Ms. Messieh’s costs on a substantial indemnity basis ($51,705.90) less Ms. Messieh’s rectification allowance ($5,000.00), a total of $46,705.90.
From Bishop Moussa to Mr. Mansour
21Bishop Moussa will pay costs incurred by Mr. Mansour’s counsel, Mr. Rodenburg, on a partial indemnity basis ($45,124.28).
22Bishop Moussa will also pay costs incurred by counsel on the rectification application, Mr. Lawler, on a partial indemnity basis ($24,830.00), less Bishop Moussa’s rectification allowance ($5,000.00) and the estate’s rectification allowance ($10,000.00), a total of $9,830.28.
From the Estate to Mr. Mansour
23The balance of the full indemnity costs incurred by Mr. Rodenburg ($29,803.73) will be paid by the estate to Mr. Mansour.
24The balance of the partial indemnity costs incurred by Mr. Lawler ($15,000.00) will be paid by the estate to Mr. Mansour.
25In the event that Bishop Moussa should fail to pay to the estate the amount awarded against him for costs incurred by Mr. Rodenburg, those costs will be paid by the estate.
Orders
26To summarize, I make the following orders:
(a) Bishop Moussa will pay costs in the amount of $46,705.90 to Ms. Messieh on behalf of the Estate of Shoukry Messieh;
(b) Bishop Moussa will pay costs in the amount of $45,124.28 to the estate trustee, Mr. Mansour, for costs incurred by Mr. Rodenburg;
(c) Bishop Moussa will pay costs in the amount of $9,830.28 to the estate trustee, Mr. Mansour, for costs incurred by Mr. Lawler;
(d) The estate will pay costs in the amount of $29,803.73 to the estate trustee, Mr. Mansour, for the balance of the costs incurred by Mr. Rodenburg on his behalf.
(e) The estate will pay costs in the amount of $15,000.00 to the estate trustee, Mr. Mansour, for the balance of the partial indemnity costs incurred by Mr. Lawler.
(f) If Bishop Moussa fails to pay to the estate the full amount awarded against him for costs incurred by Mr. Rodenburg (see (b), above), any unpaid portion of those costs will be paid by the estate to Mr. Mansour.
I.R. Smith J. DATE: October 25, 2024
1I note that the result urged by Bishop Moussa, that the estate should pay his costs of $58,292.79, seems especially unfair given that such a result would mean that the successful party, Ms. Messieh, would effectively be paying the losing party’s costs.