Court File and Parties

Court File Nos.: CV-23-00702014-00ES CV-23-00708320-00ES

Date: 2025-10-27

Ontario Superior Court of Justice (Estates List)

In the Matter of the Estate of Faina Rogovsky, deceased

Between: Elena Antzon Applicant

And: Josef Rogovsky, The Estate Trustee of the Estate of Faina Rogovsky Respondent

And: In the Matter of the Passing of Accounts of the Estate of Faina Rogovsky, Deceased

Before: Justice A.A. Sanfilippo

Counsel: Arnold H. Zweig, for the Applicant/Objector, Elena Antzon Brendan Donovan and Ayda A-Tabrizi, for the Respondent/Applicant Josef Rogovsky as Estate Trustee

Heard: July 22, 2025

Endorsement on Costs

Overview

[1] Elena Antzon and her brother, Josef Rogovsky, are the only children of Faina Rogovsky, who died on December 24, 2016 (the "Deceased"). According to the Deceased's last will and testament dated December 20, 2016, Josef was named as the sole executor and trustee of her estate (the "Estate") and Josef and Elena were named as equal beneficiaries in the residue of the Estate.

[2] Elena brought an Application to remove Josef as Estate Trustee, to require that Josef provide an interim passing of accounts, and for directions on six issues in Josef's management of the Estate that Elena challenged or questioned based on the allegation that Josef had failed to act diligently or promptly or had preferred his own interests over the interests of Elena (the "Removal Application"). Josef brought an Application for an interim passing of accounts (the "Passing of Accounts Application").

[3] The Removal Application and the Passing of Accounts Application were heard together and determined by Reasons for Judgment: Antzon v. Rogovsky, 2025 ONSC 915 (the "Reasons"). The Removal Application was dismissed, with costs to be determined in accordance with a process to be established: Reasons, at para. 80(a). The passing of accounts was approved with modifications, and the costs of the Passing of Accounts Application were ordered to be determined in accordance with a process to be established: Reasons, at para. 80(b). I wrote, at paras. 5 and 6 of the Reasons, as follows:

By the hearing of these Applications, all but one of the claims pleaded by Elena in the Removal Application had been abandoned, and the single remaining claim was settled during the hearing. Elena's 71 objections to the interim passing of accounts were reduced to two for adjudication: …The lurking issue that overshadowed the two-day hearing was who was going to bear the costs of having engaged so expansive a litigation process for so little purpose.

…Considering that the claims for costs have a greater monetary value than the issues raised by the Applications, and as the parties' cost submissions will be informed by the findings set out in these Reasons, I accepted the parties' joint submission that the costs of the Passing of Accounts Application and the costs of the Removal Application be determined at a hearing to be scheduled after the parties exchange written costs submissions, in accordance with a timetable that I will direct.

[4] I received the parties' written costs submissions in accordance with the timetable set out at para. 82 of the Reasons and heard their oral submissions on costs.

[5] For the reasons that follow, I find that Elena shall pay Josef costs of the Removal Application on a substantial indemnity scale, fixed in the amount of $70,000.00, all inclusive of legal fees, disbursements and applicable taxes. Regarding the Passing of Accounts Application, I find that Josef is awarded costs fixed in the amount of $80,000.00, all inclusive, payable from the assets of the Estate.

[6] I refer to the parties in this Endorsement on Costs by their first names, respectfully, in the same manner as was used by the parties' lawyers in their written and oral submissions and in the Reasons. I also use the same defined terms in this Endorsement on Costs as were used in the Reasons.

I. The Parties' Positions on Costs

[7] I will begin by summarizing the parties' positions.

A. The Removal Application

[8] Josef seeks costs of the Removal Application payable by Elena on the basis that Elena abandoned all but one of the claims pleaded by her in the Removal Application and settled the last remaining claim, relating to the valuation and disposition of the Jewellery, during the hearing. Josef claims that he is entitled to costs of the abandonment of all but one of the claims based on Rule 38.08(3) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, and that he is presumptively entitled to costs because he succeeded in the defence of the Removal Application. Josef submitted that the costs should be fixed on a substantial indemnity basis because Elena made unfounded allegations of improper conduct that were not proven. Josef claimed costs of the Removal Application in the amount of $88,383.09, all inclusive of fees, disbursements and applicable taxes, on a substantial indemnity basis or, alternatively, costs in the amount of $59,492.41, all inclusive, on a partial indemnity basis.

[9] Elena submitted that she had no option but to initiate the Removal Application because Josef was delaying the management of the Estate, including delaying the sale of the Annie Craig Property, because Josef refused to repay Elena's $90,000.00 Loan and because the Estate's interim accounting was unclear and imprecise. Elena submitted that the Removal Application was discontinued, making Rule 23.05 applicable. Elena contended that Rule 23.05 required Josef to bring a motion to request costs, and that the motion could be met by Elena's contention that she was justified in bringing the Removal Application. Elena offered to settle the Removal Application but, admittedly, not on terms that were more favourable to Josef than the result. Elena submitted that in the circumstances, the most appropriate remedy would be that no costs be awarded to any party.

B. The Passing of Accounts Application

[10] Josef delivered a Request for Increased Costs dated January 13, 2025 as required by Rule 74.18(11) when seeking costs greater than the amount allowed by Tariff C. Considering this Estate accounting, the Tariff amount would be $5,000.00 plus applicable taxes on an uncontested passing of accounts. The Request for Increased Costs sought costs in the amount of $138,505.29 but Josef relied on his Bill of Costs and Supplementary Bill of Costs which showed increased costs in the amount of $112,596.50, all inclusive. Josef sought these costs from Elena, personally, or alternatively sought a blended costs award where Elena pays a portion of the costs personally and the balance is paid from the assets of the Estate. Josef submitted that he was required to incur these costs to respond to the 71 objections pleaded by Elena which included allegations of misrepresentation and deceit and that, as estate trustee, he is entitled to be indemnified for the costs reasonably incurred.

[11] Elena submitted that the amount of costs sought by Josef were excessive, and that Josef has not established any basis for an award of increased costs that is more than 20 times greater than the amount allowed under Tariff C. Elena submitted that she offered to settle the issue of trustee compensation in an amount that was only modestly below the compensation awarded and that she was vindicated in her criticism of Josef's inclusion of non-estate assets in the estate accounting and Josef's decision to advance 248 loans to the Estate when, in most instances, the loan amounts were repaid to Josef from the Estate's assets on the same day. Elena submitted that the estate accounting should have been simple and straightforward as there was only one main asset of the Estate, the Annie Craig Property, which produced net sale proceeds of $1,042,144.31. Elena submitted that Josef should receive $5,000.00, plus applicable taxes, payable from the assets of the Estate as costs for the Passing of Accounts and that the parties should otherwise bear their own costs of the Passing of Accounts Application.

II. Analysis – Costs of the Removal Application

[12] As summarized in McQueen v. Cudden, 2025 ONSC 5514, at para. 20, the historical approach in estate litigation that all costs be paid out of the estate has long been displaced by an approach that is intended to ensure that estates are not unnecessarily depleted by unwarranted litigation: McDougald Estate v. Gooderham (2005), 255 D.L.R. (4th) 435 (Ont. C.A.), at para. 85. The issue of costs in estates litigation is like any form of civil litigation in that it is governed by s. 131 of the Courts of Justice Act, R.S.O. 1990, c. C.43 and r. 57 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, unless public policy considerations require that the costs be paid out of the estate. The two predominant public policy considerations are: (a) the need to give effect to valid wills that reflect the intentions of a competent testator; and (b) the need to ensure that estates are properly administered: White v. Gicas, 2014 ONCA 490, 98 E.T.R. (3d) 197, at para. 71; Westover Estate v. Jolicouer, 2024 ONCA 81, at paras. 12-13; Di Nunzio v. Di Nunzio, 2022 ONCA 889, 164 O.R. (3d) 796, at para. 9. In my view, the issues raised by the Removal Application do not fit within any public policy exception.

[13] The Removal Application was mostly abandoned prior to the hearing, with only one issue left for determination: the valuation and disposition of the Jewellery. The Removal Application was not discontinued, as submitted by Elena, but rather it proceeded to the hearing. Elena abandoned her claim that Josef be removed as Estate Trustee in the days before the hearing, after the parties had exchanged factums on this issue: Reasons, at para. 33. The one issue that survived abandonment was settled during the hearing, after preparation and hearing costs had been incurred. I do not accept Elena's submission that Rule 23.05 is applicable.

[14] Even if I had applied Rule 23.05, I do not accept that Elena would have established the "justified action" test that Elena so strongly asserted to seek to avoid liability for costs, relying on Gianopoulos v. Olga Management Ltd., [2004] O.J. No. 4273. Elena did not show that the Removal Application was justified. Elena sought, in the Removal Application, an order for the passing of accounts when Josef had already agreed to do so: Reasons, at para. 25. I found that certain of the claims for directions sought in the Removal Application were launched by Elena's misunderstanding or failure to recall steps already completed in estate administration: Reasons, at para. 34. This caused Josef to incur costs in responding to certain claims that were unnecessarily advanced.

[15] No party delivered an offer to settle that would have provided a more favourable result than the outcome of the Removal Application.

[16] I find that Josef is entitled to costs of the Removal Application arising from abandonment based on Rule 38.08(3). Had it been necessary, I would have found that Josef also established an entitlement to an award of costs based on success considering that sole issue remaining for determination in the Removal Motion was settled during the hearing and the Removal Motion was dismissed. Consistent with the determination of this issue of costs in accordance with principles applicable to costs in civil litigation, Josef's costs of the Removal Application shall be paid by Elena, personally.

[17] Turning to the scale of the costs, I accept Josef's submission that costs should be fixed on a substantial indemnity scale. The Supreme Court has instructed that costs on a substantial indemnity basis should only be awarded "where there has been reprehensible, scandalous or outrageous conduct on the part of one of the parties": Young v. Young, [1993] 4 S.C.R. 3, at p. 134; T.A.W. v. J.C.L., 2021 ONCA 270, at para. 4; Mars Canada Inc. v. Bemco Cash & Carry Inc., 2018 ONCA 239, 140 O.R. (3d) 81, at para. 43. In Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, [2004] 1 S.C.R. 303, at para. 26, the Supreme Court instructed that where a party makes unfounded allegations with access to information sufficient to conclude that the party was neither dishonest nor fraudulent, an elevated award of costs may be warranted. In Davies v. Clarington (Municipality) et al., 2009 ONCA 722, 100 O.R. (3d) 66, at para. 47, the Court of Appeal observed that baseless allegations of wrongdoing or unproven claims of deceit may merit sanction.

[18] Our courts have applied these principles to hold that where unfounded allegations of improper conduct are made that seriously impugn or prejudice the character or reputation of a party, forcing the party to respond to clear their name, the court may exercise its discretion to award elevated costs: Meuse v. Taylor, 2022 ONSC 1436, 161 O.R. (3d) 30, at para. 72; 1175777 Ontario Limited v. Magna International Inc., (2007), 61 R.P.R. (4th) 68 (Ont. S.C.), at paras. 27, 30 and 32, affirmed 2008 ONCA 406; Lyons v. Todd, 2019 ONSC 2269, 47 E.T.R. (4th) 69, at para. 30.

[19] Elena's pleading that Josef has "failed to be transparent to the Applicant", that he has a "bias and an animus" towards the Applicant and that he has unequally distributed the estate assets would not, in my view, be sufficient to support an award of costs on an elevated scale. However, Elena impugned Josef's character and reputation. Elena relied on her affidavit evidence that Josef lied to her as affirmed at para. 15 of her affidavit dated September 14, 2023, and again at para. 40 as follows: "He is delaying the administration, he has lied to me, and he is not acting objectively but in his self-interest." Elena did not prove that Josef had acted deceitfully. Further, Josef showed that Elena lacked candour in failing to disclose that she removed and sold the Jewellery without regard to Josef's authority as Estate Trustee.

[20] While the allegations and evidence in the Removal Application are sufficient for my determination that costs should be granted on an elevated scale, Elena's conduct in the Passing of Accounts Application, which was prepared for adjudication concurrently with the Removal Application, with one Application heard after the other, shows that the conduct in the Removal Application was not isolated. In paragraph 1(b) of her Notice of Objection to Passing of Accounts dated December 21, 2023 (the "Notice of Objection"), Elena stated the following as grounds for her objections: "Josef has been unfair in the accounting, has misrepresented the facts, has intended to deceive me in his accounting and is attempting to shortchange me by not setting out properly what is owed to me."

[21] Regarding fixing the amount of costs, the Court of Appeal has instructed that "[t]he overarching objective is to fix an amount of costs that is objectively reasonable, fair and proportionate … rather than fix an amount based on the actual costs incurred" by the party entitled to costs: Apotex Inc. v. Eli Lilly Canada Inc., 2022 ONCA 587, at para. 61, as applied in 100 Bloor Street West Corporation v. Barry's Bootcamp Canada Inc., 2025 ONCA 447, at paras. 71 and 86. The party seeking costs bears the burden of proving them to be reasonable: Apotex, at para. 66, as applied in 100 Bloor Street, at para. 71.

[22] Josef's Bill of Costs and Supplementary Bill of Costs, resulting in a claim for costs of $88,383.09, all inclusive, is based on Josef's delivery of a Responding Application Record comprising 1,671 pages and 86 exhibits, two-days of cross-examinations, and a hearing. In my view, the costs are unreasonable, disproportionate to an estate of this size, and are not within the reasonable expectation of Elena, considering that Elena's Costs Outline dated January 23, 2025, for both Applications, was in the amount of $67,377.88, all inclusive, on a substantial indemnity basis, and that Elena's Bill of Costs dated March 17, 2025 for the Removal Application was $34,987.96, all inclusive, on a substantial indemnity basis. I find that a reasonable, fair and proportionate amount of costs to award Josef in the Removal Application is $70,000.00, all inclusive.

[23] Considering all the factors set out in Rule 57.01, and applicable case law, and in the exercise of my discretion under s. 131 of the Courts of Justice Act, R.S.O. 1990, c. C.43, I conclude that it is fair, reasonable and proportionate that Josef shall be awarded costs of the Removal Application payable by Elena, on a substantial basis, fixed in the amount of $70,000.00, all inclusive of legal fees, disbursements, and applicable taxes.

III. Analysis – Costs of the Passing of Accounts Application

[24] A Request for Increased Costs is governed by the principles set out in Re Estate of John Mitchell, 2010 ONSC 1640, 56 E.T.R. (3d) 38, and Rule 74.18(11). In Re Mitchell Estate, at para. 5, Justice D.M. Brown, as he then was, held that "the court must review the request [for increased costs] to ensure that it is fair and reasonable in the circumstances." Justice Brown observed, at para. 2, that "a request for increased costs is made by the applicant fiduciary in cases of some complexity or where significant objections were received in respect of the accounts which required time and expense to resolve." The party seeking the increased costs has the burden of justifying the increased costs: Re Mitchell Estate, at para. 5.

[25] As Estate Trustee, Josef is generally entitled to be indemnified for all reasonably incurred costs in the administration of an estate: Geffen v. Goodman, [1991] 2 S.C.R. 353, at p. 391; Westover Estate v. Jolicouer, 2024 ONCA 81, at para. 14. However, a trustee's claim for indemnification will fail where a determination is made that the estate trustee "acted unreasonably, or in substance for their own benefit, rather than for the benefit of the estate": Goodman, at p. 391; Muscat v. Muscat Estate, 2025 ONCA 518, at para. 19, relying on Westover, at para. 14. Where the estate trustee is found to have acted reasonably in the litigation, the court may require the other party to pay the costs or, may make a blended order requiring the losing party to pay some of the costs and the estate to pay the balance: Sawdon Estate v. Watch Tower Bible and Tract Society of Canada, 2014 ONCA 101, 119 O.R. (3d) 81, at para. 97; Toller James Montague Cranston (Estate of), 2021 ONSC 3704, 66 E.T.R. (4th) 156, at para. 8; Estate of Francoise Poitras v. Canadian Cancer Society, 2021 ONSC 406, 67 E.T.R. (4th) 140, at para. 31.

[26] Elena responded to the Passing of Accounts Application by delivery of the Notice of Objection listing 71 objections. On February 12, 2024, Josef delivered a Response to the Notice of Objection to Accounts that comprised 564 pages. Josef's Bill of Costs showed that Josef incurred $40,591.80 to prepare the accounting.

[27] Elena withdrew all but two of the 71 objections set out in her Notice of Objection but, on the evidence, I found that Elena was mistaken in at least ten of the objections: Reasons, at para. 40. Of the two objections remaining for determination, Elena's objection to Josef's claim for reimbursement of $6,925.07 was dismissed: (Reasons, at para. 51). However, there was divided success on Elena's objection to Josef's compensation. I denied Elena's objection that Josef should not receive any compensation, and rejected Elena's submission that Josef should be deprived of compensation by reason of exceptional or serious misconduct: Reasons, at para. 68. But Elena was successful in reducing Josef's level of compensation from the amount claimed, $58,386.61, all inclusive, to the amount of $36,160.00, all inclusive.

[28] Neither party delivered an offer to settle the issue of trustee compensation that was more favourable than the result.

[29] I found that Josef took steps in the administration of the Estate that needlessly complicated the estate, expanded the scope of the accounting and contributed to an increasingly strained relationship with Elena: Reasons, at paras. 72 and 77. This resulted from Josef's decision to deposit the Registered Accounts into the estate bank account; advancing the 248 Estate Trustee Loans; and by providing a beneficiary with signing authority on the estate banking. I found that these factors supported a reduction in trustee compensation by 25% to produce a compensation that was fair and reasonable: Reasons, at para. 75.

[30] In my view, the costs sought by the Estate Trustee of the Passing of Accounts Application of $112,596.50, all inclusive, were not reasonably incurred. Even apart from my finding that the Estate administration was made more complex by unnecessary steps taken by Josef, these costs are excessive and disproportionate to the value of this Estate and its accounting. After consideration of all applicable factors and principles, I fix the costs of the Passing of Account Application in the amount of $80,000.00, all inclusive.

[31] I order that the costs of $80,000.00, all inclusive, shall be paid from the assets of the Estate, for the following reasons. Both Josef and Elena contributed to the Estate incurring increased costs for the Passing of Accounts Application. Josef, by conducting the estate administration in a manner that needlessly complicated the accounting. Elena, by incurring increased costs by bringing many objections that were not established. Josef's submission that Elena should pay all or a portion of the costs of the Passing of Accounts Application heavily relied on the findings in Toller James Montague Cranston (Estate of), 2021 ONSC 3704. However, in that decision, the objectors had raised 300 objections and were found to be wrong on all but 5. There was no finding, like here, that the estate trustee had taken steps in the administration of the Estate that needlessly complicated the estate in a way that expanded the scope of the accounting and contributed to an increasingly strained relationship with the beneficiary. I also decline to order that Elena pay a portion of the costs of the Passing of Accounts Application as her conduct was taken into consideration in awarding costs of the Removal Application on a substantial indemnity scale.

[32] Josef and Elena are equal beneficiaries in the residue of the Estate. In my view, it is fair and reasonable that the increased costs of the estate accounting be paid from the assets of the Estate.

IV. Disposition

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

(a) Josef is awarded costs of the Removal Application payable by Elena, on a substantial basis, fixed in the amount of $70,000.00, all inclusive of legal fees, disbursements, and applicable taxes.

(b) Josef is awarded costs of the Passing of Accounts Application fixed in the amount of $80,000.00, payable from the assets of the Estate.

[34] Any party may take out a formal order by filing a draft order on Case Center, together with the approval as to form and content of all parties, and forwarding a copy, in PDF and Word format, to the Court Registrar and the Estates List Trial Coordinator, to be brought to my attention.

Justice A.A. Sanfilippo

Date: October 27, 2025