Superior Court of Justice
NEWMARKET COURT FILE NO.: CV-23-00001606-0000
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
NORBERT TYLL Applicant/Moving Party
– and –
RUEDIGER TYLL, WOLFGANG TYLL, THE ESTATE OF WALTRAUD TYLL and THE ESTATE OF ERIC TYLL Respondent/Responding Parties
Alissa Winicki, for the Moving Party, Norbert Tyll
Jason A. Schmidt, for the Responding Party, Wolfgang Tyll
HEARD: November 15, 2024
REASONS FOR DECISION
Overview
1The Applicant, Norbert Tyll (“Norbert”), brings this motion for:
a) an Order setting aside the Order of Charney J. dated August 9, 2024, pursuant to r. 37.14(1)(b) of the Rules of Civil Procedure, RRO 1990, Reg 194;
b) in the alternative, an Order that there shall be no distribution of any property or assets of the Estate of Waltraud Tyll until such time as the issues outlined in the Notice of Application for Directions of Norbert Tyll, issued April 4, 2023, have been disposed of; and
c) an Order and Declaration that the Applicant has satisfied his disclosure obligations under the previous court Orders in these proceedings.
Background
2Without meaning any disrespect, throughout these reasons I will refer to the parties by their given names.
3Eric Tyll (“Eric”) and Waltraud Tyll (“Waltraud”) had three boys, Norbert, Wolfgang Tyll (“Wolfgang”), and Ruediger Tyll (“Ruediger”).
4Eric passed away on May 22, 2016.
5Waltraud passed away on August 13, 2022.
6Norbert was named the sole Estate Trustee for Waltraud’s estate.
7Norbert and Wolfgang were named co-Estate Trustees for Eric’s estate.
8On June 15, 2023, Norbert commenced this Application for directions.
9On July 19, 2023, pursuant to the Order of Edwards J., Norbert was appointed Estate Trustee for the Estate of Waltraud Tyll, and Norbert and Wolfgang were appointed co-Estate Trustees for the Estate of Eric Tyll.
10The Order of Edwards J. also directed that: there be no distribution of Waltraud’s estate until further order, or on the agreement of the parties; within 60 days of his appointment Norbert was to deliver to the beneficiaries of Waltraud’s estate a statement of assets as of the date of Waltraud’s death; and Norbert was to provide copies of any documents he received as a result of said Order to Wolfgang.
11Thereafter, the brothers battled over the obligations set out in the Order of Edwards J. and whether Norbert had fulfilled them.
12Counsel for Wolfgang brought a contempt motion which was heard by Bale J. on May 15, 2024. Norbert was represented by counsel, Ms. Eni Hanxhari.
13On consent, Bale J. ordered that: within 15 days, Norbert swear and produce an affidavit confirming no assets of Waltraud’s estate had been distributed, and provide a statement from the account in which the funds were invested; Wolfgang was to provide Norbert certain specified documents no later than June 1, 2024; the parties were to exchange affidavits of documents no later than June 28, 2024; and the parties were to submit to examinations for discovery no later than July 31, 2024.
14Wolfgang, being of the view that Norbert refused to comply with Bale J.’s Order, brought a second contempt motion on July 31, 2024. The contempt motion was heard by Charney J., who made the following Orders relevant to this motion:
a) the removal of Norbert as Estate Trustee of Waltraud’s estate;
b) the removal of Norbert as co-Estate Trustee of Eric’s estate;
c) the appointment of Alison Lester as Estate Trustee During Litigation (“ETDL”) for both Eric and Waltraud’s estates; and
d) costs payable personally by Norbert to Wolfgang, in the amount of $4,859.
15Norbert contends that he did not have notice of the contempt motion, and thus was unaware Wolfgang was seeking to have him removed as Estate Trustee of both estates. Norbert claims that his inability to respond to Wolfgang’s allegations has resulted in procedural unfairness, which Norbert seeks to reverse by having Charney’s J.’s Order set aside.
Proper Notice of the Motion
16On June 24, 2024, Norbert advised Ms. Eni Hanxhari, his lawyer at the time, that he wished to end his retainer.
17Wolfgang’s contempt motion was issued on July 9, 2024, and scheduled for July 31, 2024. The Affidavit of Service confirms that the Motion Record was served on Norbert by way of email to Ms. Hanxhari on July 9, 2024.
18It is likely that Wolfgang’s lawyer, Mr. Jason Schmidt canvassed motion dates with Ms. Hanxhari in advance of issuing the motion, given that on July 3, 2024, Ms. Hanxhari advised Mr. Schmidt that Norbert was in the process of retaining new counsel.
19On July 19, 2024, Ms. Hanxhari’s clerk emailed Norbert to advise him of the upcoming motion. She attached both the Confirmation of Motion, and the Confirmation of filing of the Motion Record.
20On July 22, 2024, Norbert replied to Ms. Hanxhari’s clerk as follows:
On June 24/24 I fired Eni and the Bozai Law firm.
On July 19/24, Schmidt filed with the court and served your law firm with a Confirmation of Motion? …and has set a court date for July 31?
Please tell me why your firm was served and why he states that he conferred with your firm that you agreed to the court date? I expect Eni to have filed her notice of “no longer representing me” with the court and the apposing (sic) council shortly after her dismissal? If she did, please forward a copy of both to me asap.
…and as far as the court date goes, I do not agree to it (nor will I attend it) as I have not yet hired new councel (sic). (still in the process).
21Ms. Hanxhari replied the same day, advising Norbert that he was required to advise the court, and opposing counsel, that he was no longer represented by Bozai Law. She further advised he was required to serve a Notice of Intent to Defend or a Notice of Intention to Act in Person (“Notice”). Ms. Hanxhari helpfully provided Norbert with a completed Notice for his review and signature.
22Finally, Ms. Hanxhari confirmed that Norbert should follow up with Mr. Schmidt regarding his position on the pending motion.
23On July 31, 2024, Ms. Hanxhari’s office emailed Norbert, advising that they were in court on Zoom and trying to get off the record. They asked Norbert to sign off on the Notice. There is no evidence that Norbert replied to this email.
24On August 2, 2024, Ms. Hanxhari’s office followed up with Norbert, once again requesting that he sign the Notice.
25It is Norbert’s evidence that he did not receive a copy of the contempt Motion Record from Ms. Hanxhari, nor did he learn of the results of the motion until he received an email from Ms. Lester on August 30, 2024.
26Norbert was cross examined on his affidavit sworn in support of the within motion. When asked whether receipt of the July 19, 2024 email from Ms. Hanxhari’s office would have put him on notice of the July 31, 2024 motion, Norbert said no, he was not aware of the motion.
27When pressed, Norbert continued that the email contained no detail as to what the motion was about. Norbert then said he was under the impression the motion was because of Bale J.’s Order. Eventually Norbert agreed, reluctantly, that he in fact did have notice of the motion.
28Norbert said that he did not attend the motion because he was still in the process of looking for a lawyer. Again, when pressed, Norbert said he did not think the motion was important enough for him to attend, as in his view it was “about exchanging documents.”
29Norbert confirmed that he did not reach out to Mr. Schmidt’s office, nor did he attend court via Zoom, as Zoom was not working on his computer. He took no steps to figure out how he might attend the July 31, 2024 appearance.
30Nor did Norbert ask Ms. Hanxhari for a copy of the motion record, or ask her for clarification on what the motion was about.
Conclusion
31Based on these facts, I am satisfied Norbert had proper notice of the motion. He received advice from Ms. Hanxhari that a motion had been scheduled, and that it would be proceeding. Given that Norbert had not filed a Notice, Wolfgang’s lawyer was obligated to serve the Motion Record on Norbert through his lawyer of record, Ms. Hanxhari.
32Norbert is familiar with the concept of a Notice of Intent to Act in Person. He had previously served one between being represented by his prior lawyer (Ms. Ellen Brohm of Ellen’s Estates Advocacy1) and Ms. Hanxhari.
33Norbert was cavalier about the motion. As an Estate Trustee, it was incumbent upon him to contact Mr. Schmidt’s office and ask for a copy of the Motion Record and request an adjournment that would permit him time to retain counsel. Instead, with reckless disregard he permitted a motion, in respect of the two estates he was appointed to administer, to proceed without representation.
34Norbert’s approach to the contempt motion is echoed in his approach to administering Waltraud’s estate. For example, despite the clear Order of Edwards J. that there shall be no distribution of Waltraud’s property or assets until further order of the court, Norbert felt the word “distribution” was too vague. Thus, he believed he was within his rights to transfer money to himself from Waltraud’s estate, which he did a number of times in the form of loans.
35Another example is when Norbert was faced with the impropriety of using estate funds to make certain purchases. His reply was simply “I’ll deduct that from my inheritance.”
36A final example is Norbert’s inability to recall what four withdrawals, for the exact same amount of money ($9,352), in a relatively short period of time, were for.
Estate Trustee During Litigation Necessary
37In the event I am incorrect, and Norbert did not have proper notice, after an appeal of my decision (entailing yet another court appearance) Charney J.’s Order would be set aside, and Wolfgang’s contempt motion will be heard ab initio, with Norbert’s participation.
38Based on the information before the court for this motion, including the transcript of Norbert’s cross examination on his affidavit sworn October 23, 2024, I am satisfied that the outcome of the contempt motion would be the same, and Ms. Lester would once again be appointed ETDL.
39Norbert and Wolfgang are clearly in an adversarial position vis a vis the other. In his affidavit, Norbert states he has “serious concerns about Wolfgang’s records during the time that he acted as Waltraud Tyll’s Attorney for Property. Significant amounts of money were withdrawn that have not been accounted for by Wolfgang.”
40For his part, Wolfgang alleges that Norbert has failed to comply with various of terms of the Orders set out by Edwards J. and Bale J.; has dispersed all or part of the funds of Waltraud’s estate; and has failed to take meaningful steps to advance the administration of either Eric or Waltraud’s estates.
41ETDLs serve an important function in estate litigation, particularly where, as here, there are warring factions. The ETDL is an arm’s length, neutral, third party whose only concern is to manage the estate, for the benefit of the beneficiaries, while litigation continues.
42I find favour with the approach taken by Myers J. in Mayer v. Rubin, 2017 ONSC 3498, 30 E.T.R. (4th) 239, at para. 36, in respect of the appointment of ETDLs:
It is in the interests of all beneficiaries that the assets of the estate be immunized from the tactics employed by litigating parties. The court must protect the level playing field. Neither side should be able to use their control over the estate to benefit themselves or to prejudice the other. It is a simple inference that a trustee who is in an adversarial position towards a co-trustee or a beneficiary should not normally be left in charge of trust property. Simple prudence calls for the temporary replacement of a trustee who is an adversarial position with a co-trustee or a beneficiary. It is not an insult to anyone’s integrity to understand that conflicts of interest are insidious. Conflicts of interest play havoc with peoples’ judgment of their own capacity to maintain neutrality and a fiduciary stance.
43The same sentiment applies here; Myers J. could have easily been speaking about Norbert and Wolfgang.
44Finally, I commend Mr. Schmidt’s office for proposing Ms. Lester as an ETDL, as opposed to seeking Wolfgang’s appointment as trustee of both estates. Such an outcome would have muddied the battlefield even further.
Costs
45At the conclusion of the hearing I asked counsel what their clients would be seeking in costs if they were successful. Each side came in at virtually the same amount: $12,000.
46As the successful party, Wolfgang is awarded his costs of the motion in the amount of $12,000.
CASULLO J.
Released: November 27, 2024