CITATION: Rosenberg v. Lipman, 2026 ONSC 3008
CV-25-00743168-00ES
CV-25-00743169-00ES
ONTARIO
SUPERIOR COURT OF JUSTICE
IN THE MATTER OF THE ESTATE OF HAROLD AMMON ROSENBERG, deceased
BETWEEN:
SARA ROSENBERG (AKA SANDRA ROSENBERG) AND MARLA PEREZ, EXECUTORS OF THE ESTATE OF BARRY ROSENBERG and SARA ROSENBERG (AKA SANDRA ROSENBERG) personally
Applicants
– and –
ALLAN LIPMAN in his capacity as trustee of the Estate of Harold Ammon Rosenberg, Trustee of the Rosenberg Trust, and personally, ROBBIE ROTIN, in his capacity as Trustee of the Estate of Harold Ammon Rosenberg, Trustee of the Rosenberg Trust, and personally, FREDA FREEDMAN, MARLA PEREZ, ALANA KLEIN and BARBARA HART
Respondents
AND:
IN THE MATTER OF THE PASSING OF ACCOUNTS OF THE ESTATE OF HAROLD AMMON ROSENBERG, DECEASED
AND:
IN THE MATTER OF THE PASSING OF ACCOUNTS OF THE ROSENBERG TRUST
David Goodman, for the Applicants
Brendan Donovan and Diana McBey, for the Respondents
Brendan Donovan and Diana McBey, for the Applicants, Allan Lipman and Robbie Rotin, as Trustees
David Goodman, for the Objectors, Sara Rosenberg and Marla Perez as trustees of the Barry Rosenberg Estate, and Sara Rosenberg personally
HEARD: February 23, 24, 25 and 26, 2026
REASONS FOR DECISION
A.A. SANFILIPPO J.
Overview
1Harold Ammon Rosenberg died on February 25, 2007 (the “Deceased”). The Deceased left a primary last will and testament (the “Primary Will”) and a secondary last will and testament (the “Secondary Will”) both dated July 10, 2006 (collectively, the “Wills”), and a codicil executed January 17, 2007 (the “Codicil”). The Wills and the Codicil were prepared by lawyer Allan L. Lipman who was named by the Wills and Codicil as estate trustee along with the Deceased’s accountant, Robbie Rotin. For nearly 19 years, Mr. Lipman and Mr. Rotin have acted as the estate trustees (collectively, the “Trustees”) of the estate of Harold Ammon Rosenberg (the “Estate”) and of the testamentary trusts established further to the Wills and Codicil.
2The Deceased was survived by his son, Barry Rosenberg, by his daughter, Barbara Hart, by their spouses and children, and by Freda Freedman, who is referred to by the Trustees as the Deceased’s common law spouse. Through his Primary Will and Codicil, the Deceased provided for Ms. Freedman and for his children and, indeed, their children through the establishment of irrevocable testamentary trusts. The Trustees referred to these as “spendthrift trusts”, because the trusts were designed to prevent the beneficiaries from dissipating their inheritance through irresponsible spending. These trusts directed the periodic distribution of trust income to Barry Rosenberg and his spouse Sara Rosenberg through the “Rosenberg Trust”, and to Barbara Hart and her spouse Lawrence Hart through the “Hart Trust”, to safeguard them from squandering the capital of the trusts, with authority to the trustees to encroach on capital to make further distributions in their “absolute discretion”. The children of Barry Rosenberg and Barbara Hart, being the Deceased’s grandchildren, are remainder capital beneficiaries in that they stand to inherit any amount left in the trusts at the time of their parents’ deaths.
3After almost 15 years of uneventful administration of the Estate, the Deceased’s son, Barry and his wife, Sara Rosenberg, brought this Application in 2022 to remove the Trustees (the “Removal Application”). Upon Barry Rosenberg’s death in 2025, the Removal Application was continued by Ms. Rosenberg, personally, and together with her daughter, Marla Perez, as trustees of the estate of Barry Rosenberg (collectively, the “Applicants”). The Applicants seek to remove the Trustees from their appointments to administer the Estate and the Rosenberg Trust and replace them with Ms. Perez and Ms. Rosenberg’s brother, Gabriel Szarfer.
4Mr. Lipman and Mr. Rotin brought two Applications to Pass Accounts: an Application in court file number CV-25-00743168-00ES to pass the accounts of the Estate (the “Estate Accounting Application”) for the period from February 25, 2007 to December 31, 2022 (the “Estate Accounts”); and an Application in court file number CV-25-00743169-00ES to Pass the accounts of the Rosenberg Trust (the “Trust Accounting Application”) for the period from August 26, 2020 to December 31, 2022 (the “Trust Accounts”). Ms. Rosenberg objected to the Estate Accounts and the Trust Accounts both in her personal capacity and, along with Ms. Perez, as Estate Trustee of the Barry Rosenberg Estate. On July 15, 2025, I ordered that the Removal Application, the Estate Accounting Application and the Trust Accounting Application (collectively, the “Related Proceedings”), be heard at the same time, as has now occurred.
5None of the other beneficiaries supported Ms. Rosenberg and Ms. Perez in the Removal Application. None of the other beneficiaries objected to the Passing of Accounts of the Estate and of the Rosenberg Trust. No one sought to remove the Trustees from their role in administration of the Hart Trust.
6For the reasons that follow, I order that the Applicants failed to establish the basis for removal of the Trustees from either the Estate or the Rosenberg Trust, with the result that the Removal Application is dismissed. Further, the Applicants, as Objectors, failed to establish their objections to the Estate Accounting Application and the Trust Accounting Application except on the issue of the Trustees’ compensation, which shall be reduced from the amount claimed by the Trustees. Judgments shall thereby issue passing the Estate Accounts and the Trust Accounts with the revised Trustees’ compensation.
I. FACTUAL BACKGROUND
7Many of the facts that form the factual context for the analysis of these Related Proceedings were not contentious in that they were either uncontested by competing evidence, admitted in responding affidavit evidence, unchallenged or conceded in the out-of-court cross-examinations, or stipulated in argument. I will begin by setting out these facts.
A. The Family
8The Deceased was predeceased by his wife, Mildred Rosenberg, with whom he had two children, Barry Rosenberg and Barbara Hart. Ms. Hart was married to Lawrence Hart, who died on August 29, 2016. Barbara Hart and Lawrence Hart (collectively, the “Harts”), have three children/ grandchildren to the Deceased: Richard Hart, Bradley Hart, and Cynthia Cohen. Barry Rosenberg and Sara Rosenberg (collectively, the “Rosenbergs”) have two children/ grandchildren to the Deceased: Alana Klein and Marla Perez. Ms. Klein has three children/ greatgrandchildren to the Deceased, one of whom is Dylan Klein.
9Mr. Szarfer is Ms. Rosenberg’s brother. He is not related to the Deceased. Mr. Szarfer is an 81-year-old long-retired bookkeeper/accountant who was retained by his sister, Ms. Rosenberg, to review the Estate Accounts and Trust Accounts even though he had never been involved in a passing of accounts.
10The Rosenbergs were the Applicants in the Removal Application until Barry Rosenberg’s death on June 7, 2025. By Order to Continue dated July 9, 2025, the Removal Application was continued by the estate of Barry Rosenberg (the “Barry Rosenberg Estate”) through its estate trustees, Ms. Rosenberg and Ms. Perez.
11Ms. Freedman died on November 29, 2024. The Applicants do not seek any relief against the estate of Freda Freedman (the “Freedman Estate”) and, accordingly, did not continue the Removal Application against the trustees of the Freedman Estate.
12The Deceased was a successful businessman who had, at the time of his death on February 25, 2007, assets worth approximately $3,793,715. Mr. Lipman was the Deceased’s long-standing lawyer and Michael Daren and Mr. Rotin were the Deceased’s accountants at the accounting firm of Segal GCSE LLP.
B. The Wills and Codicils
13Clause 2 of the Primary Will, as replaced by clause 1 of the Codicil, named the Deceased’s lawyer, Mr. Lipman, and the Deceased’s accountant, Mr. Rotin, as the Trustees of the Estate. The Wills and the Codicils provided for the following distributions of the Estate’s assets:
(a) The Primary Will directed, in clause 3(b), that the Trustees hold the Deceased’s interest as a 50% tenant in common in a condominium municipally known as 3800 Yonge Street, Apt. 717, Toronto (the “Yonge Condo”) for Ms. Freedman, the other tenant in common, to occupy on certain conditions, and that upon Ms. Freedman no longer needing the Yonge Condo, the Deceased’s interest in the Yonge Condo shall form part of the residue of the Estate.
(b) The Primary Will directed, in clause 3(c), that the Trustees settle $100,000 in a trust to pay $1,000 each month to Ms. Klein (the “Klein Trust”) firstly from the net income of the trust with the balance, if necessary, by encroachment on the capital of the Klein Trust.
(c) The Primary Will directed, in clause 3(d), that the Trustees settle $300,000 in a trust whose income was to be paid to Ms. Freedman monthly (the “Freedman Trust”), with the power of encroachment, and that any remaining proceeds upon Ms. Freedman’s death (November 29, 2024) shall form part of the residue of the Estate.
(d) The Primary Will directed, in clause 3(e), that the residue of the Estate be split in two equal shares (50/50) and that the two equal shares be allocated as follows:
(i) By clause 3(e)(i), one share into a trust for Barry and Sara Rosenberg (the “Rosenberg Trust”), referred to in the Wills and Codicil as the “Rosenberg Beneficiaries”.
(ii) By clause 3(e)(ii), one share into a trust for Barbara and Lawrence Hart (the “Hart Trust”), referred to in the Wills and Codicil as the “Hart Beneficiaries”.
(e) Clause 3(e)(iii) of the Primary Will was replaced by clause 2 of the Codicil, which directed the Trustees to pay, in their absolute discretion, the net income from the Rosenberg Trust to the Rosenberg Beneficiaries as well as a capital distribution of $25,000 every 3 years.
(f) Similarly, Clause 3(e)(iv) of the Primary Will was replaced by clause 3 of the Codicil, which directed the Trustees to pay, in their absolute discretion, the net income from the Hart Trust to the Hart Beneficiaries as well as a capital distribution of $25,000 every 3 years.
(g) Clause 3(e)(v) of the Primary Will provided that upon the death of the survivor of the Rosenberg Beneficiaries, now only Ms. Rosenberg, the Trustees shall, subject to the provisions of clause 4 which restricts distributions to minors, distribute the amount remaining in the Rosenberg Trust to the issue of Barry Rosenberg: being Ms. Klein and Ms. Perez.
(h) Clause 3(e)(vi) of the Primary Will provides that upon the death of the survivor of the Hart Beneficiaries, now only Ms. Hart, the Trustees shall, subject to the provisions of clause 4 which restricts distributions to minors, distribute the amount remaining in the Hart Trust to the issue of Ms. Hart: being Richard Hart, Bradley Hart, and Cynthia Cohen.
(i) The Secondary Will dealt with the Deceased’s shares in a private company known as 1454118 Ontario Ltd. (“1454118 Ltd.”). The Primary Will specifically excludes the Deceased’s “right, title and interest in any shares I may own in the capital of 1454118 Ltd.” 1454118 Ltd. was the legal owner of a condominium municipally known as Unit 83A, Building No. 2, 4108 Palm Air Drive West, Pompano Beach, Florida (the “Florida Condo”).
14I will refer to Ms. Klein, Ms. Perez, Richard Hart, Bradley Hart and Ms. Cohen collectively as the “Remainder Capital Beneficiaries”.
15The Wills and the Codicil provided the Trustees with authority to encroach on the capital of any of the trusts, in their “absolute discretion” to carry out the purposes of the Wills and Codicil, as follows:
(a) Clause 3(e)(iii) of the Primary Will provided the Trustees with authority to encroach on the capital of the Rosenberg Trust “in such amounts and in such proportions as my Trustees shall, at any time or from time to time in their absolute discretion deem appropriate for the maintenance of advancement in life or otherwise of the Rosenberg Beneficiaries”.
(b) Clause 3(e)(iv) of the Primary Will provided the Trustees with authority to encroach on the net income or capital of the Hart Trust “as the Trustees may in their absolute discretion deem advisable to or for the benefit of either of the Hart Beneficiaries to the other of the Hart Beneficiaries in such shares and proportions and in such manner as the Trustee shall in their absolute discretion think fit.”
(c) Clause 3(d) of the Primary Will provided the Trustees with “a power of encroachment upon the whole or any part of the capital of the Freedman Trust to be used for the maintenance and/or advancement in life of Freda Freedman all as determined in the absolute discretion of my Trustee from time to time.”
16A Certificate of Appointment of Estate Trustee with a Will was issued on July 24, 2007, to Mr. Lipman and Mr. Rotin in probate court file number 01-1775-07 (the “Probate Application”), for the Primary Will and the Codicil (the “Certificate of Appointment”). Mr. Lipman deposed that he was the Deceased’s lawyer and friend for about 20 years and acted in the Deceased’s personal and business legal needs, including the Deceased’s business, Ideal Food Services Inc. (“Ideal Inc.”). I accept as uncontested, Mr. Lipman’s evidence that he was thoroughly familiar with the Deceased’s family and fully aware of the Deceased’s concerns about whether his children would be able to manage their own finances when he was no longer able to guide them.
17Mr. Rotin deposed that he was the Deceased’s personal accountant for many years, and provided accounting services for Ideal Inc. I accept Mr. Rotin’s evidence that he was familiar with the Deceased’s objectives in the transfer of wealth to his children, and that he was familiar with the financial circumstances of the Rosenbergs and of the Harts. Mr. Rotin acted as the accountant for the Rosenbergs and the Harts and prepared their personal income tax returns annually.
C. The Deceased’s Inter Vivos Financial Support of his Children
18I saw no dispute that the Deceased routinely and generously provided financial support to his children and grandchildren during his lifetime.
19The Deceased owned and operated Ideal Inc. and the Rosenbergs and the Harts worked at this business, Barry Rosenberg starting in the 1970s and Sara Rosenberg in the 1990s. In 1999, Ideal Inc. went into receivership. Ms. Rosenberg deposed that her father began to give her and Barry Rosenberg financial support of $1,875 each month, which, in September 2020, he increased to $5,000 per month. As was his custom, whatever the Deceased provided to the Rosenbergs, he also provided to the Harts. By letter dated August 24, 2000, Mr. Lipman notified the Rosenbergs and the Harts of their father’s decision to provide them with a gratuitous payment of $5,000 each month, as follows:
We have been asked by Harold to advise you that he is in the midst of implementing a financial plan that will commencing September 1, 2000 gratuitously pay to each of Barry Rosenberg and Barbara Hart $3,125 tax-free dollars monthly. This payment of $3,125 per month to each of Barry Rosenberg and Barbara Hart will be in addition to the $1,875 currently being paid also to each of Barry Rosenberg and Barbara Hart, tax free from Harold’s mortgage receivable on the Bathurst Street property.
Accordingly in the aggregate commencing September 2000 and in each month thereafter until further notice each of Barry Rosenberg and Barbara Hart will be receiving $5,000 per month tax-free gratuitously from Harold Rosenberg. [Emphasis added]
20Both the Rosenbergs and the Harts lost their homes after the receivership of Ideal Inc. The Deceased provided the Harts with $285,000 to assist them in the purchase of a new residential property. Consistent with his practice of benefitting his children equally, the Deceased offered to provide the Rosenbergs with a matching amount of $285,000. Ms. Rosenberg deposed that she and Barry Rosenberg used this money to pay off their mortgage in the amount of $216,235, a Royal Bank line of credit in the amount of $46,653, and a Bank of Nova Scotia line of credit in the amount of $19,363.
21Mr. Lipman deposed, and the Applicants did not contest, that when the Deceased provided the Rosenbergs and the Harts with $285,000 each, he was concerned that his children would, again, refinance their properties, with the result that his generosity and support in repaying their existing debts, and assisting them in acquiring shelter, would have been in vain. In Mr. Lipman’s words, the Deceased worried that he would have to “bail out” his children yet again. Mr. Lipman explained this to the Rosenbergs in a letter dated January 10, 2021, as follows:
After Harold paid off your existing mortgages in 2007 he was very concerned that all he had done is provided you with an opportunity for you to refinance your property again and that his actions in repaying your existing mortgages would have been a waste of money. Harold and I discussed this matter with each of you at the time of advancing the monies to discharge your existing mortgages and it was agreed that Harold would take back a mortgage on your property for the monies advanced in order to prevent you from dissipating your equity. The charge was signed with your full knowledge of the reason therefore and with your consent.
22The Trustees showed that the Rosenbergs executed an Acknowledgement and Direction and a Direction Regarding Funds on July 14, 2006, in furtherance of the registration of a Mortgage (the “Rosenberg Mortgage”) against title to the property owned by the Rosenbergs and known as 1 Edenbridge Drive, Thornhill, Ontario (the “Edenbridge Property). The Rosenbergs received a reporting letter dated September 9, 2008 from Mr. Lipman’s law firm on the closing of the Rosenberg Mortgage.
23The Deceased arranged his financial support for the Harts equally. When the Deceased provided $285,000 to the Harts to assist them in purchasing a property, taken in title by one of their children, the Deceased obtained a mortgage in the amount of $285,000 registered against title to the Hart’s new home (the “Hart Mortgage”).
24The Deceased’s granddaughter, Ms. Klein, deposed that the Deceased helped her financially, including by paying for a night nurse and nanny to assist with support and care after Ms. Klein had triplets.
25I accept, as uncontested and supported by a plain reading of the Wills and the Codicil, Mr. Lipman’s evidence that the Deceased put “extra thought and care into how his financial legacy would be approached [in his Wills and Codicil], and whom he needed to care for when he was gone.” I also accept, as uncontested, by a plain reading of the Wills and the Codicil, and by the surrounding evidence, that the Wills reflect the Deceased’s concern that his children were unable to live within their financial means and his concern that the distribution of his Estate must protect his children from their own irresponsible spending and financial mismanagement. I accept the Trustees’ submission that the Deceased’s intention was to establish “spendthrift trusts” to regulate the periodic distribution of money to his children and to cause any capital remaining in the trusts, after the death of his children and their spouses, to go to his grandchildren as Remainder Capital Beneficiaries.
D. The Estate Administration
26Upon commencing the estate administration, the Trustees established an estate account to administer all estate assets (the “Estate Account”). The Trustees knew, from their long-time familiarity with the Deceased, that the Deceased had assets invested at Cidel (formerly Toron), a Canadian private investment bank (“Toron/Cidel”), and held investments at Investors Group. The Trustees decided to continue the existing financial management agreement with Toron/Cidel, as the financial advisor or investment portfolio manager of the Estate, in accordance with the authority provided by Clause 7 of the Primary Will, which provides in pertinent part as follows:
My Trustee shall have separate and substantive power to retain any of my investments or assets in the form existing at the date of my death in its absolute discretion without responsibility for loss with the intent that investments or assets so retained shall be deemed to be authorized investments for all purposes of this my Will.
27Upon their appointment, the Trustees began to make monthly payments to Ms. Klein, based on Clause 3(c) of the Primary Will, and to Ms. Freedman, based on Clause 3(d) of the Primary Will. By November 2007, the Trustees settled three trusts through transfers from the Estate Account:
(a) The Klein Trust, settled with $100,169.
(b) The Freedman Trust, settled with $300,216.
(c) The Dylan Klein Trust, settled with $26,076.
28While the Klein Trust was directed by Clause 3(c) of the Primary Will and the Freedman Trust was directed by Clause 3(d) of the Primary Will, the Dylan Klein Trust was not established pursuant to the Will. Rather, Mr. Lipman and Mr. Rotin deposed, and I accept as uncontested, that Dylan Klein is a disabled child of Alana Klein, and thereby grandchild to Ms. Rosenberg, who had financial needs. On August 2, 2007, Ms. Freedman together with the Rosenbergs, the Harts and all the Remainder Capital Beneficiaries authorized and directed the Trustees to settle a trust for Dylan Klein through allocation of $30,000 from the Estate Account (the “Dylan Klein Trust Authorization”).
29The Klein Trust was fully depleted by February 2014 by exhaustion of income and capital through distributions to Alana Klein. The Dylan Klein Trust has similarly been exhausted. The Freedman Trust provided distributions of income and encroachment of capital to Ms. Freedman until her death on November 29, 2024, at which time the remaining capital in the amount of $187,000 was transferred to form part of the residue of the Estate.
30There can be no dispute, based on the T3 Trust Income Tax and Information Returns that have been produced, that the Rosenberg Trust and the Hart Trust were both established in 2008 (within one year of the Deceased’s death), as separate legal entities paying taxes and making distributions to their respective beneficiaries. The Rosenberg Trust and the Hart Trust assets were invested in the same investment account until August 26, 2020, when the Rosenberg Trust and the Hart Trust were settled. Upon the settlement of the Rosenberg Trust and the Hart Trust, the Estate Account was transferred, in equal shares, into the Rosenberg Trust and the Hart Trust.
31Since Mr. Lipman and Mr. Rotin commenced their estate administration with a wealth of background knowledge of the steps that the Deceased had taken in financial support for his children, they knew that the Deceased had, since September 2000, been providing the Harts and the Rosenbergs with $5,000 each month. And so, upon the Deceased’s death, the Trustees began to provide the Harts and the Rosenbergs with $5,000 each month, even though this required encroaching on the capital of the Estate. To provide further cash flow to the Rosenbergs and the Harts, the Trustees decided, with the concurrence of the Rosenbergs and the Harts, to provide $8,333.33 annually to the Rosenbergs and the same amount to the Harts, which constituted the annualized variation on the direction contained in Clauses 3(e)(iii) and 3(e)(iv) of the Primary Will (replaced by Clauses 2 and 3 of the Codicil) to encroach on the capital of the Estate Account to distribute to the Rosenbergs and the Harts the amount of $25,000 on each third year anniversary of the Deceased’s death.
32The Primary Will allowed for encroachment on the capital of the Estate, in the absolute discretion of the Trustees. Since any encroachment on capital could affect the amounts that would remain for distribution to the Remainder Capital Beneficiaries, the Trustees called on the Remainder Capital Beneficiaries to consent to any encroachment on capital requested by the Rosenbergs or the Harts. I accept, because it is not contested, that the Trustees encroached on the capital of the Estate Account, at the request of the Rosenbergs, to make capital encroachments to the Rosenbergs in 2007 ($20,000), 2008 ($5,000), 2016 ($20,000) and 2020 ($20,000). The Trustees made matching capital encroachments to the Harts. The Trustees routinely sought and received the consent of the Remainder Capital Beneficiaries to these encroachments on capital.
33Mr. Rotin established, without contest, that in the 14-year period from December 31, 2007 to December 31, 2021, the Trustees distributed the amount of $1,118,142 to the Rosenbergs from the Estate, and that during the same time the Trustees distributed the amount of $1,101,642 to the Harts from the Estate. These distributions consisted of $5,000 each month, $8,333.33 annually, and the capital encroachments.
34In the 14-year period from 2007 to 2021, the administration of the Estate proceeded without apparent conflict or controversy.
E. The Dispute Between the Rosenbergs and the Trustees
35On January 4, 2022, the Rosenbergs wrote to Mr. Rotin that they had not received any information about the Estate “in the past 17 years” and had just found “that a Mortgage has been placed on our property on July 19, 2007.” Mr. Rotin and Mr. Lipman responded that these allegations were incorrect and provided the Rosenbergs with documents in support of their rebuttal of both complaints.
36On January 19, 2022, the Rosenbergs demanded, through counsel, that the Rosenberg Mortgage be discharged from title to the Edenbridge Property and that the Trustees encroach on the capital of the Rosenberg Trust to provide the Rosenbergs with $75,000 for their use in payment of a personal line of credit. By February 28, 2022, the Rosenbergs increased their request for an encroachment on capital to the amount of $88,400, together with a discharge of the Rosenberg Mortgage.
37On January 21, 2022, Mr. Lipman responded that encroachment on the capital was “totally at the discretion of the Trustees”, and that the Trustees had “not seen any detailed request and justification for the encroachment on capital.” Mr. Lipman explained that the beneficiaries’ “command will not compel encroachments on demand”, but rather that the Trustees required a basis on which to exercise their discretion to encroach on capital.
38On February 28, 2022, the lawyer for the Rosenbergs wrote that the Rosenbergs required an encroachment on capital of $88,400 to pay for “monthly rents, food, camp and many other expenses” for their daughter Alana Klein as she had separated from her husband who was no longer providing support. The Rosenbergs would later deliver an email dated April 5, 2022 in which they represented, without supporting records, that they paid 47 months of rent for Alana at a cost of $82,000. The Rosenbergs also demanded the discharge of the Rosenberg Mortgage and financial statements and records for the estate administration. On April 7, 2022, the Trustees proposed to approve a capital encroachment of $40,000, subject to the consent of the Remainder Capital Beneficiaries.
39The Rosenbergs retained litigation counsel on June 10, 2022 who demanded that the Trustees provide a complete accounting from the date of death to present, and reiterated the Rosenbergs’ monetary demands. Mr. Lipman explained, on June 14, 2022, that the Rosenbergs’ daughter, Ms. Klein, objected to the encroachment on capital requested by her parents. Ms. Klein would later deliver an affidavit, sworn February 15, 2023, in which Ms. Klein swore that her parents did not pay her rent, or provide any support beyond periodic gifts, and that the Rosenbergs were “acting maliciously by falsely using [Ms. Klein] as an excuse to deplete the [Rosenberg] Trust.”
40By June 14, 2022, Mr. Rotin provided the Rosenbergs with an Informal Accounting of the Estate, in the form of a Statement of Accounts for the period from February 25, 2007 to April 30, 2022. On June 28, 2022, the Trustees offered to bring an Application for the Court’s directions on the request for an encroachment on capital at the expense of the Rosenbergs. On July 14, 2022, the Rosenbergs requested the production of source documents supporting the Informal Accounting that had been provided by the Trustees and renewed their request for encroachment on the capital of the Estate. On July 20, 2022, the Trustees asked the Rosenbergs to produce a detailed statement of net worth and a statement of the proposed use of the requested capital so that the Trustees could determine whether to exercise their discretion to encroach on the capital of the Estate.
41On July 29, 2022, the Rosenbergs submitted, through counsel, that they had no sources of income other than fixed government pensions, and that they required an encroachment on capital to “pay down a credit card and line of credit which were drawn in order to make ends meet while providing necessities of life to their daughter, Alana Klein, at a time when she was a single mother of three children with no means of support,” repeating their representation, so adamantly denied by Ms. Klein, that they had expended funds in the financial support of Ms. Klein.
42On August 15, 2022, the Trustees notified the Rosenbergs that they required more detailed financial information on the Rosenbergs’ assets, liabilities, monthly income and expenses in order to assess whether to grant a capital encroachment. On November 14, 2022, the Rosenbergs brought the Removal Application.
F. The Related Proceedings
43In the Removal Application, the Rosenbergs seek the following:
(a) An Order removing the Trustees as trustees of the Estate.
(b) An Order removing the Trustees as trustees of the Rosenberg Trust.
(c) An Order that the Trustees commence Applications to pass their accounts in the form prescribed by rule 74.18(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, for both the Estate and the Rosenberg Trust.
(d) An order appointing a neutral third party as the succeeding estate trustee of the Estate and of the Rosenberg Trust.
(e) An Order that the Rosenberg Mortgage be discharged from title to the Edenbridge Property.
44The Trustees consented to an Order, granted by Justice Dietrich on April 20, 2023, that the Trustees “file accounts of the Estate and the Rosenberg Trust, and an application to pass accounts in accordance with rules 74.17 and 74.18 by no later than July 31, 2023” (the “April 2023 Order”). The April 2023 Order provides, further, that the Trustees shall make a “one-time encroachment of $88,400 from the capital of the Rosenberg Trust” to the Rosenberg Beneficiaries and directed documentary and financial disclosure.
45The Trustees brought the Estate Accounting Application on May 13, 2025 to pass the Estate Accounts, which are for the accounting period of February 25, 2007 to December 31, 2022 (the “Estate Accounting Period”). The Trustees brought the Trust Accounting Application on May 13, 2025 to pass the Trust Accounts, which are for the period from August 26, 2020 to December 31, 2022 (the “Trust Accounting Period”).
46Further, in accordance with the April 2023 Order, the Trustees provided a capital encroachment of $88,400 to the Rosenbergs. Additionally, the Trustees discharged the Rosenberg Mortgage from title to the Edenbridge Property without requiring the Rosenbergs to pay $285,000 into the Rosenberg Trust. This stands in contrast to the requirement imposed by the Trustees that the Harts pay $285,000 into the Hart Trust upon discharge of the Hart Mortgage.
47In an Amended Notice of Motion brought in the Removal Application, the Applicants sought an order to remove the Trustees as trustees of the Estate and of the Rosenberg Trust and to appoint, in their place, Mr. Szarfer and Ms. Perez as succeeding trustees of both the Estate and the Rosenberg Trust, rather than the appointment of a neutral third party succeeding trustee as pleaded in the Notice of Application.
II. THE ISSUES
48The issues remaining for determination are as follows:
(a) In the Removal Application, including the Motion brought within it, the Applicants’ claim that Mr. Lipman and Mr. Rotin be removed as Trustees of the Estate and of the Rosenberg Trust and be replaced with Mr. Szarfer and Ms. Perez.
(b) In the Estate Accounting Application and the Trust Accounting Application (collectively, the “Passing of Accounts Applications”), the Applicants’ claim that neither the Estate Accounts nor the Trust Accounts should be passed but rather that an order be granted for a forensic accounting of the Estate and Rosenberg Trust to be paid by the Trustees, personally.
49The grounds for the Removal Application are broader than the objections to the Passing of Accounts Applications, because the grounds for the Removal Application are not limited to the conduct of the Trustees during the Estate Accounting Period and the Trust Accounting Period, both of which end on December 31, 2022 (collectively, the “Accounting Periods”), but rather continue to present. The grounds for the Removal Application do, however, build on the determination of the objections to the Passing of Accounts Applications. Accordingly, I will first determine the Passing of Accounts Applications and will then analyse the Removal Application.
50To frame my analysis, I will explain my determination of the weight to be attributed to the witnesses’ evidence.
III. THE EVIDENCE
51The Applicants tendered the evidence of Ms. Rosenberg, as set out in her affidavit sworn November 9, 2022, which was corroborated by Barry Rosenberg’s affidavit sworn the same day. Further, the Applicants relied heavily on the evidence of Mr. Szarfer, as tendered in affidavits sworn July 8, 2025 (the “Szarfer #1 Affidavit”) and January 5, 2026 (the “Szarfer #2 Affidavit”). The Trustees relied principally on the affidavits of Mr. Lipman and Mr. Rotin affirmed January 27, 2023, filed in response to the Notice of Application, and the affidavits of Mr. Lipman and Mr. Rotin affirmed October 6, 2025, filed in response to the Notice of Motion. The Trustees also relied on the affidavit of Anthony J. O’Brien, a colleague of Mr. Lipman, sworn January 26, 2023.
52Although this affidavit evidence was delivered in the Removal Application, it was also relied on by all parties in the Passing of Accounts Applications.
53The Trustees objected, in my view correctly, to the admissibility of parts of the affidavit evidence of Mr. Szarfer on two grounds: on the basis that parts of his evidence constituted unreliable hearsay; and on the basis that Mr. Szarfer purported to provide opinion evidence. Mr. Szarfer was a bookkeeper and accountant who retired some 20 years ago. Although he is Ms. Rosenberg’s brother, he has no direct evidence of dealing with the Deceased and never dealt with the Trustees. Mr. Szarfer was retained by his sister to review the Estate Accounts and the Trust Accounts, in the manner expected of a paid litigation expert, but conceded that he has never prepared a passing of accounts and that he is not an expert in the passing of accounts.
54The Applicants did not tender Mr. Szarfer as an expert to provide opinion evidence, and therefore did not, purposefully, comply with Rule 53.03. The Applicants conceded that several paragraphs of Mr. Szarfer’s affidavit evidence constitute opinion evidence provided by a witness who was not admitted to provide opinion evidence.1 I have disregarded any opinion evidence provided by Mr. Szarfer as he was not admitted nor qualified to provide opinion evidence.
55The Applicants also conceded that several paragraphs of Mr. Szarfer’s affidavit evidence constitute hearsay in that Mr. Szarfer has no direct knowledge of the facts to which he has deposed but is recounting that which he heard from others.2 Mr. Szarfer’s affidavits are replete with hearsay evidence, including with regards to facts that are otherwise uncontested, as well as hearsay evidence that mimics the direct evidence of Ms. Rosenberg. I have considered the hearsay evidence provided by Mr. Szarfer only where corroborated by the admissible evidence of the other witnesses or by the documentary evidence, and only when not impeached in the out of court cross-examination.
56The Applicants submitted that the evidence of the Trustees was not credible nor reliable, and the Trustees urged me to make the same finding regarding the evidence of Ms. Rosenberg and Mr. Szarfer. As I have explained, many of the facts that form the factual context for the analysis of these Related Proceedings were not contentious. For the resolution of contentious evidence, credibility issues “do not always require viva voce evidence to be determined”: V2 Investment Holdings Inc. v. Mizrahi, 2026 ONCA 275, at para. 47, applying Temagami (Municipality) v. Temagami Barge Ltd., 2025 ONCA 315, at para. 8. I found that there was ample record in the Related Proceedings to determine the credibility of the witness testimony.
57I was troubled by the credibility and reliability of Ms. Rosenberg’s evidence. Ms. Rosenberg deposed that she and her late husband required an encroachment on capital to recover amounts paid for Ms. Klein’s rent ($82,000). This was convincingly contradicted by Ms. Klein, whose evidence I accept because Ms. Rosenberg did not provide any documentary evidence to establish the rental payments said to have been paid on behalf of her daughter. Ms. Rosenberg’s evidence that she had not received any Estate accounting prior to January 2022 was shown to be incorrect, and her evidence that she was unaware of the Rosenberg Mortgage was undermined when Ms. Rosenberg was shown that she had executed closing documents at the time that the Rosenberg Mortgage was registered on title to the Edenbridge Property, and had received a reporting letter. Ms. Rosenberg retreated from her initial sworn evidence that the Deceased had entered into a commercial agreement to pay Barry Rosenberg and her $5,000 each month, later conceding that she was no longer sure. There was no such contractual duty because the Deceased’s provision of $5,000 each month to each of his children was, as written by Mr. Lipman in his letter of August 24, 2000, gratuitous.
58The Court of Appeal instructed that some inconsistences in evidence are material and others are peripheral, but “[w]here an inconsistency involves something material about which an honest witness is unlikely to be mistaken, the inconsistency may demonstrate a carelessness with the truth about which the trier of fact should be concerned”: R. v. A.M, 2014 ONCA 769, 123 O.R. (3d) 536, at para. 13, citing R. v. G. (M.) (1994), 93 C.C.C. (3d) 347 (Ont. C.A.) at p. 354. I approached Ms. Rosenberg’s evidence with caution and will rely on it only when contrary to her interests, when unimpeached in cross-examination, and when corroborated by contemporaneous documents or other credible witness evidence. The admissible evidence of Mr. Szarfer largely mimics the evidence of Ms. Rosenberg and thereby attracts the same caution.
59I found the evidence of Mr. Lipman and Mr. Rotin to be consistent and logical, corroborated by contemporaneous documents, and set out in a forthright and sincere manner. Their evidence was not impeached by the out of court cross-examination. I accept their evidence as credible and reliable.
IV. ANALYSIS – THE PASSING OF ACCOUNTS APPLICATIONS
60After the Trustees delivered an informal accounting on January 27, 2023, the Applicants delivered a Notice of Objection to Accounts dated February 14, 2024. When the Passing of Accounts Applications were brought, Ms. Rosenberg, both personally and together with Ms. Perez on behalf of the Barry Rosenberg Estate, delivered a Notice of Objection to Accounts on September 17, 2025, filed identically in both the Estate Accounting Application and the Trust Accounting Application (collectively, the “Notice of Objection”). As the same Notice of Objection to Accounts was delivered in both Passing of Accounts Applications, the Trustees delivered the same Reply to Notice of Objection to Accounts, dated November 27, 2025, in the Passing of Accounts Applications (collectively, the “Reply to Objection”).
61The Children’s Lawyer delivered a Notice of Non-Participation in Passing of Accounts in both Passing of Accounts Applications. Barbara Hart did not require a Passing of Accounts of the Hart Trust and did not object to the Estate Accounting Applications. The Remainder Capital Beneficiaries did not object to the Passing of Accounts Applications.
62The Applicants’ Notice of Objection consisted of 60 paragraphs set out in 34 pages. Each was responded to by the Trustees’ Reply to Objection. In their Factum and oral submissions, the Applicants limited their objections to discrete areas of the Estate Accounts and Trust Accounts. The Applicants did not submit that these objections give rise to modification or variation or arithmetic adjustment of the values set out in the Estate Accounts and Trust Accounts, other than the issue of compensation, but rather contended that the Estate Accounts and Trusts Accounts were so defective and unreliable that an order should issue for a forensic accounting of the Estate Accounts and the Trust Accounts spanning their 15-year Accounting Period (2007 to 2022). I will explain my determination of these objections.
A. Analysis of the Objections
63The process for the passing of accounts is prescribed by Rules 74.16 to 74.18. Rule 74.17(1) provides that “[e]state trustees shall keep accurate records of the assets and transactions in the estate accounts filed with the court shall include” those materials set out in subrules 74.17(1)(a) to (j), inclusive. This includes a statement of original assets, details of any disposition of assets, moneys received and disbursed, liabilities, compensation claimed and a statement of assets unrealized at the end of the accounting period
64An estate trustee has a duty “to keep proper books of account and to be ready at all times to account for the trust property that [he] is bound to administer”: Wall v. Shaw, 2018 ONCA 929, 43 E.T.R. (4th) 1, at para. 23. A trustee must keep a complete record of their management of the trust and must have the accounts ready and give full information when required to prove that the trust has been administered prudently and honestly: Zimmerman v. McMichael Estate, 2010 ONSC 2947, 103 O.R. (3d) 25, at para. 31.
65Section 49(2) of the Estates Act, R.S.O. 1990, c. E.21, provides that a judge “has jurisdiction to enter into and make full inquiry and accounting of and concerning the whole property that the deceased was possessed of or entitled to, and its administration and disbursement.” Section 49(3) of the Estates Act provides the Court with authority “to inquire into any complaint or claim by any person interested in the taking of the accounts of misconduct, neglect, or default on the part of the executor, administrator or trustee occasioning financial loss to the estate or trust fund, and the judge, on proof of such claim, may order the executor, administrator or trustee, to pay such sum by way of damages or otherwise as the judge considers proper and just to the estate or trust fund.” To do so, the Court may order the trial of any issue raised by the accounting, as provided by s. 49(4) of the Estates Act. As the Court of Appeal has explained, a passing of accounts application “initiates a judicial ‘inquiry’ into the affairs of an estate:” Wall, at para. 47.
66I have applied these principles in my analysis of the Applicants’ objections.
(a) The Opening Balances in the Klein Trust and Freedman Trust and the Establishment of the Dylan Klein Trust
67The Applicants objected to the opening balances in the Klein Trust and the Freedman Trust. Ms. Rosenberg submitted that the Trustees paid her daughter, Ms. Klein, $8,800, in the period from February 2007 to the settling of $100,169 into the Klein Trust in November 2007, representing an overpayment of $8,800. Similarly, the Applicants objected that the Estate paid Ms. Freedman $17,458.73 in the period from February 2007 to the settling of $300,216 into the Freedman Trust in November 2007, representing an overpayment of $17,458.73. The Applicants’ objection was that the amounts distributed to these beneficiaries for these 10 months should have been deducted from the amount that was settled into their Trusts.
68The Trustees were appointed upon the Deceased’s death on February 25, 2007 and began to make monthly payments to Ms. Klein and Ms. Freedman, as directed by the Primary Will and Codicil. The Trustees showed that the amounts distributed to Ms. Klein and Ms. Freedman were in accordance with the Trusts established for them by the Primary Will and Codicil, either as payments from interest or encroachments on capital. I see no merit in the Applicants’ objections. If either of the Klein Trust or the Freedman Trust was over-capitalized at the time that the Trust was settled, it was in a de minimis amount, more akin to a rounding error. The Applicants’ objections that the Klein Trust and the Freedman Trust were over-capitalized are denied.
69In the Notice of Objection, the Applicants also objected to the Trustees’ establishment of the Dylan Klein Trust, supported by the evidence of Mr. Szafer that the “Trustees took it upon themselves to recommend to all parties that this additional Trust be created, without any explanation as to their reasoning.” I reject this evidence as unreliable hearsay as Mr. Szarfer had no role in the settling of the Dylan Klein Trust. In the Notice of Objection, at paragraph 48, Ms. Rosenberg objected that “we do not know why a Dylan Klein Trust was set up; it was not provided for in the Will.” In cross-examination, Ms. Rosenberg conceded that she knew that the Dylan Klein Trust was established because the Deceased, and indeed all beneficiaries, wanted Dylan Klein to have money for treatment for autism. And Ms. Rosenberg conceded that she executed the Dylan Klein Trust Authorization on August 2, 2007, to support the settling of the Dylan Klein Trust for her grandson, Dylan. The Applicants waived this objection at the hearing. However, there was never any basis for this objection.
(b) Excessive Distributions to Freda Freedman
70The Applicants objected that the Trustees made excessive distributions to Ms. Freedman and that, as a result, there was less money left in the Freedman Trust to transfer to the residue of the Estate upon Ms. Freedman’s death on November 29, 2024. The Applicants have a financial interest in this issue because the remaining capital in the Freedman Trust, specifically $187,000, was transferred after Ms. Freedman’s death in equal shares (50:50) to the Rosenberg Trust and the Hart Trust, in accordance with Clauses 3(d) and 3(e) of the Primary Will, as amended by the Codicil.
71Apart from the Applicants’ complaint regarding the opening balance in the Freedman Trust, which I have dismissed, the Applicants objected to the Trustees distributing to Ms. Freedman more than the amount of the income on the $300,000 allocated to the Freedman Trust. The Applicants objected that the annual income on the Freedman Trust was about $10,836 each year (about $900 each month) and that the Trustees encroached on capital and paid Ms. Freedman $1,416.89 per month from 2007 to about 2011 and then increased to $1,500 each month.
72The Deceased directed, by Clause 3(d) of the Primary Will, that his Trustees “shall pay all of the net income earned [on the Freedman Trust] to or for the benefit of Freda Freedman on a monthly basis for the remainder of her life.” The Trustees did so. The Deceased provided the Trustees with the power to encroach “on the whole or any part of the capital of the Freedman Trust to be used for the maintenance and/or advancement in life of Freda Freedman all as determined in the absolute discretion of my Trustee from time to time.” The Trustees did so.
73In Walters v. Walters, 2022 ONCA 38, 160 O.R. (3d) 249, at para. 37, the Court of Appeal explained that a “testator’s intention is ascertained from a consideration of the will and the surrounding circumstances”, and that the “court puts itself in the position of the testator at the time the will was made”, citing Trezzi v. Trezzi, 2019 ONCA 978, 150 O.R. (3d) 663, at para. 13, and Ross v. Canada Trust Company, 2021 ONCA 161, 458 D.L.R. (4th) 3, at paras. 35-41. Here, there can be no question that the Deceased intended to establish a testamentary trust for Ms. Freedman, as he did for Ms. Klein, the Rosenbergs, and the Harts. And there can be no doubt that, in each case, the Deceased intended to provide the Trustees with “absolute discretion” to encroach on the capital of the trusts. Each of the clauses in the Primary Will that confers authority on the Trustees to encroach on capital provides that they may do so in their “absolute discretion”.
74In Walters, at paras. 47-48, the Court of Appeal instructed that the court may intervene even where the testator has conferred an absolute discretion on the trustee, where the trustee has acted with mala fides. To determine whether intervention is warranted, the court will assess whether: “(1) the decision is so unreasonable that no honest or fair-dealing trustee could have come to that decision; (2) the trustees have taken into account considerations which are irrelevant to the discretionary decision they had to make; or (3) the trustees, in having done nothing, cannot show that they gave proper consideration to whether they ought to exercise the discretion.”
75The Applicants objected to the Trustees’ encroachment on capital for the benefit of Ms. Freedman on the basis that the Trustees did not conduct any investigation of Ms. Freedman’s needs or income before exercising their discretion to encroach on the capital of the Freedman Trust. In essence, that the Trustees did not give proper consideration to whether they ought to exercise their discretion. The Applicants submitted that Ms. Freedman’s terminal tax return showed that she had an income of almost $70,000 at the date of death and thereby Ms. Freedman did not need any capital encroachment on the Freedman Trust.
76Mr. Lipman deposed, corroborated by Mr. Rotin, that the Trustees calculated the reasonable amount over and above the income from the Freedman Trust that enabled Ms. Freedman to properly budget her expenditures over time, with a view to carrying out the Deceased’s direction to encroach on capital as needed for Mr. Freedman’s “maintenance or advancement in life.” Mr. Rotin produced docket entries of March 2007, May 2007, June 2007 and August 2007, that record discussions with Ms. Freedman about budgeting her expenditures, amounts needed for her support and care, and tax situation. Mr. Lipman produced a docket entry in January 2010 that records “ongoing review with respect to encroachments, including in particular in favour of Freda Freedman”, and again in January 2011 and May 2014. Mr. Lipman produced a docket entry of an invoice dated November 8, 2006, to the Deceased that records: “Preparing budget for Freda Freedman on April 26, 2006” and “Analysis of income on April 28, 2006 and forwarding forecast for Freda Freedman. Mr. Lipman showed, and I accept that he reviewed with the Deceased, and obtained directions regarding how best to manage Ms. Freedman’s budgetary requirements.
77The total amount of monthly payment to Ms. Freedman was $1,500, at its highest, out of a trust that was settled with $300,000. After Ms. Freedman’s death, some 17 years after the Freedman Trust was settled, the amount of $187,000 remained for transfer from the Freedman Trust to the Hart Trust and the Rosenberg Trust, in equal 50% portions, representing an encroachment on capital of about $112,000 over 17 years. I find that the Trustees’ exercise of discretion to encroach on capital in favour of Ms. Freedman followed the principles set out in the case law in that they considered Ms. Freedman’s budget, needs and available sources of income. I reject Mr. Szarfer’s evidence that the capital encroachments were inappropriate because Ms. Freedman was “far from the poverty line”. There is no requirement that a beneficiary transgress a poverty line before a trustee can consider encroaching on capital to provide for maintenance and advancement of life.
78The Applicants’ objection that there were excessive distributions to Ms. Freedman is dismissed.
(c) Inadequate Distributions to the Rosenbergs
79There was a strange inconsistency in the Applicants’ objection that the Trustees failed to properly exercise their discretion by excessively encroaching on capital to the benefit of Ms. Freedman and, indeed, to Ms. Klein, but that the Applicants exercised their discretion properly when they generously encroached on capital every time the Rosenbergs asked, except once. Specifically, the Trustees showed that they encroached on capital of the Estate Account to pay the Rosenbergs $5,000 each month during the Estate Accounting Period, because the income from the estate assets was insufficient to cover this amount. Additionally, the Trustees encroached on capital to the benefit of the Rosenbergs in 2007, 2008, 2016 and 2020. In the 15-year period from 2007 to 2022, the Rosenbergs did not make any complaint that the Trustees acted in mala fides or misunderstood the legal principles applicable to their exercise of discretion to encroach on capital when the encroachment was for their benefit.
80The only time that the Trustees did not immediately accede to the Rosenberg’s request to encroach on capital was in January 2022 when the Rosenbergs requested an encroachment of $75,000, later increased to $88,400. The Trustees did not outright deny this encroachment on capital, but rather requested evidence from the Rosenbergs regarding the basis for the request, consistent with their obligations under the Primary Will and Codicil and, as now explained, at law. Considering Ms. Klein’s objection to the encroachment and considering that the factual evidence provided by the Rosenbergs in support of the encroachment was not only unsubstantiated but, based on Ms. Klein’s evidence, misleading, the caution by the Trustees in seeking further evidence from the Rosenbergs before encroaching further on capital was both understandable and justified.
81I find that the Trustees’ request for further evidence to support the Rosenbergs’ request for an encroachment in January 2022 was proper, and that this encroachment was later made as part of the terms of the April 2023 Order, after further disclosure. The Applicants’ objection to the Trustees’ management of their request for capital encroachment was not established.
(d) Delay in Discharge of the Rosenberg Mortgage
82The Applicants contend that the Trustees failed to discharge the Rosenberg Mortgage upon request by the Rosenbergs. The Trustees requested that the principal amount of the Rosenberg Mortgage, specifically $285,000, be paid into the Rosenberg Trust, as the Harts had done in transferring $285,000 into the Hart Trust as part of the discharge of the Hart Mortgage in March 2022 upon Ms. Hart’s sale of the condominium that secured the Hart Mortgage.
83The Trustees agreed to discharge the Rosenberg Mortgage in or about April 2023, providing the Rosenbergs with the ability to refinance the Edenbridge Property or monetize its value through sale. The Applicants object that the Trustees’ delay in agreeing to this discharge resulted in financial loss to the Rosenbergs in legal fees and inability to realize on the value of the Edenbridge Property in 2022 as opposed to 2023.
84The Applicants did not tender any evidence to show that they lost any value in the marketing of the Edenbridge Property arising from the timing of the discharge of the Rosenberg Mortgage. And the Applicants did not establish any costs in seeking the discharge that were separate from the costs of this Application. I saw no merit in this objection.
(e) The Sale of the Florida Condo
85The Applicants objected that the Trustees mishandled the net sale proceeds from the sale of the Florida Condo in two ways. First, the Applicants contended that the net sale proceeds ought to have been transferred to 1454118 Ltd. and that Barry Rosenberg and Barbara Hart were each entitled, through the Secondary Will, to receive 50% of their father’s shares in 1454118 Ltd. Instead, the Deceased’s share of the net sale proceeds was deposited into the Estate Account and then allocated to the Rosenberg Trust and the Hart Trust in equal (50%) shares. Second, the Applicants submitted that the deposit of the Deceased’s share of the net sale proceeds into the Estate Account was in Canadian currency when the net sale proceeds were realized in U.S. currency, thereby depriving the Applicants of the monetary benefit of a favourable currency exchange. I find that neither of these objections were established. I will explain why.
86The Deceased and Ms. Freedman bought the Florida Condo by Purchase Contract signed April 29, 1989, for the price of $167,000. On the closing of the purchase of the Florida Contract, in or about May 20, 1989, title to the Florida Condo was taken by the Deceased and Ms. Freedman. The Deceased and Ms. Freedman were joint owners of the legal and beneficial interest in the Florida Condo.
87In or about March 14, 2001, the Deceased and Ms. Freedman transferred the Florida Condo to 1454118 Ltd. The Articles of Incorporation of 1454118 Ltd. are dated December 14, 2000, and the Shareholders’ Register shows that 100 shares were issued in 1454118 Ltd., and that the Deceased owned 50 shares and Ms. Freedman owned 50 shares, for which they paid $50, each. I saw no challenge to Mr. Lipman’s evidence that 1454118 Ltd. did not purchase the Florida Condo from the Deceased and Ms. Freedman but rather that the legal title was transferred gratuitously to 1454118 Ltd. as part of a plan to minimize U.S. taxes.
88The Florida Condo was sold in or about August 2013 and produced net sale proceeds of $188,611.46. Mr. Lipman deposed, without challenge, that one-half of the net sale proceeds ($94,320) were paid to Ms. Freedman, as joint owner, and that the other one-half ($94.320) was paid to the Estate Account and then allocated in equal 50% shares ($47,000) to the Rosenberg Trust and to the Hart Trust.
89The Applicants objected that the net proceeds from the sale of the Florida Condo should not have been paid, in part, to Ms. Freedman and, in part, to the Estate. I saw no merit in this submission. The Applicants did not provide any basis for their objection that 50% of the net sale proceeds should not have been transferred to Ms. Freedman either outright, as occurred, or by reason of her ownership of 50% of the shares of 1454118 Ltd. Ms. Freedman was, unquestionably, the 50% owner of the Florida Condo and was entitled to receive 50% of the net sale proceeds as a co-owner: not by reason of her entitlements as a beneficiary under the Wills and the Codicil.
90Regarding their objection that the Deceased’s 50% of the net sale proceeds ought not to have been deposited in the Estate Account and then distributed in equal portions to the Rosenberg Trust and the Hart Trust but rather transferred to 1454118 Ltd., the Applicants rely on Clause 3(e) of the Primary Will, which excludes from the Estate the Deceased’s shares in 1454118 Ltd. I accept the Trustees’ submission that the Rosenbergs and the Harts are each entitled to share equally in the Deceased’s 50 shares in 1454118 Ltd., and thereby each receive 25 shares in 1454118 Ltd., independent of their entitlements in the Estate. In any event, the Applicants did not show that these shares have any more than nominal value.
91The Applicants did not establish that 1454118 Ltd. paid anything to the Deceased and Ms. Freedman for the transfer of the Florida Condo. Indeed, Ms. Rosenberg conceded in affidavit evidence and in cross-examination that 1454118 Ltd. held the legal interest in the Florida Condo in trust. The Applicants did not establish that the beneficial interest in the Florida Condo passed from the Deceased and Ms. Freedman to 1454118 Ltd. Accordingly, while 1454118 Ltd. held legal title to the Florida Condo, the Applicants did not establish that 1454118 Ltd. had a beneficial interest in the Florida Condo.
92Of central importance on the Estate Accounting Application, the Applicants did not show an error in the Trustees’ accounting of the sale of the Florida Condo that caused them financial detriment. The Deceased was entitled to only 50% ($94,320) of the net sale proceeds, and this amount was credited to the Estate Account and then transferred in equal portions ($47,000) to each of the Rosenberg Trust and the Hart Trust. The Applicants did not show that they would have received a greater amount had the amount of $94,320 been transferred to 1454118 Ltd. and then paid to the Rosenbergs and the Harts as dividends on their shares in 1454118 Ltd. The Applicants’ objection on the Trustees’ accounting of the sale of the Florida Condo was not established and is dismissed.
93Regarding the conversion of the net sale proceeds of the Florida Condo from U.S. currency to Canadian currency, Mr. Lipman deposed, in his affidavit of October 6, 2025, that “in June 2013, the Canadian and U.S. dollars were essentially at par.” In the Response to the Notice of Objections delivered by Mr. Lipman and Mr. Rotin on May 23, 2024, they similarly notified the Applicants, in paragraph 20, that “in June 2013, the Canadian and U.S. dollars were essentially at par.” Despite being notified of the Trustees’ evidence that the Canadian and U.S. currency was exchanged essentially at par in June 2013, the Applicants did not tender any admissible evidence of the currency exchange rates at the time of the transfer of the net proceeds of the sale of the Florida Condo. I specifically decline the Applicants’ submission that I should take judicial notice that the currency exchange rate was different than par at material times, as it would not be permissible to do so under legal principles applicable to the taking of judicial notice: R. v. Find, 2001 SCC 32, [2001] 1 S.C.R. 863, at para. 48. This is an issue on which the Applicants had to tender admissible evidence to prove their claim that they were deprived of the value of currency exchange. They failed to do so.
94I accept as unchallenged by any other admissible evidence, that the currency exchange rates in place at material times did not produce a higher amount of net sale proceeds to be deposited into the Estate Account arising from the sale of the Florida Condo than the $94,320 (CAD) that was deposited in the Estate Account. The Applicants’ objection on this issue was not established and is dismissed
(f) Failure to Investigate Other Sources of Estate Assets
95The Applicants objected that the Trustees failed to investigate the recovery of assets that belonged to the Estate and could have enhanced the amount available for distribution to the beneficiaries. The Applicants relied on the following, amongst other examples: the Deceased withdrew money from his Investors Group account in several withdrawals in January and February 2007; the Deceased’s T5 income tax return showed that he withdrew money from his investments in 2006 and 2007; proceeds from the sale in 2000 of a property known municipally as 444 Bathurst Street, Toronto; and, assets available to the Deceased from the estate of his late wife, Mildred Rosenberg, who died in 1974.
96Each of these objections pre-date the Deceased’s death, which occurred on February 25, 2007. The Applicants did not establish how the Trustees, appointed after the Deceased’s death, had a duty to audit the Deceased’s management of his assets prior to death.
97Further, Mr. Rotin’s account of September 17, 2007, shows that he met with the Deceased and Ms. Freedman in January 2007 “to discuss his Estate, Will and Trust administration”. Both Mr. Lipman and Mr. Rotin had a thorough understanding of the Deceased’s estate planning by reason of having provided professional services to him for many years, and both Trustees showed that they took steps soon after the Deceased’s death to assemble and analyze his estate assets for probate purposes.
98I find that the Applicants’ broad objection that the Trustees failed to investigate other sources of estate assets was not established and is therefore dismissed.
(g) Failure to Communicate with the Beneficiaries
99Mr. Szarfer swore that until December 31, 2021, Mr. Rotin “refused to have any written communications” with the beneficiaries. Ms. Rosenberg deposed on November 9, 2022, that she has been at a “complete information disadvantage” as to the value of the Estate and her entitlements. The Applicants submitted that the failure by the Trustees to prepare a passing of accounts until required to do so in 2023 is evidence of their “benign neglect” of their duties as Trustees.
100I accept Mr. Rotin’s evidence, uncontested on this point, that he prepared the personal income tax returns for the Rosenbergs every year from 2007 to 2022. I also accept Mr. Rotin’s evidence that the Rosenbergs could have asked Mr. Rotin any question pertaining to the Estate’s accounting at any time from 2007 to 2022 but did not. The Rosenbergs approached the Trustees when they sought encroachment on capital, including in 2007, 2008, 2016 and 2020, without making any complaint that they were deprived of information regarding the Estate accounting, or that the Trustees declined to communicate with them.
101In at least 2014, 2015 and 2016, Mr. Rosenberg provided the Rosenbergs with a report on the value of the Estate holdings, the rate of return for the investment portfolio in the year, with comparative assessment of how the rate of return compared to previous years, going back to 2012, and information on the tax treatment of the Trusts. In each instance, Mr. Rotin invited further questions from the Rosenbergs: “If you have any questions or comments regarding the above, please don’t hesitate to contact me.”
102I accept Mr. Rotin’s evidence, corroborated by Mr. Lipman, that the first time that the Rosenbergs asked for more financial information regarding the Estate was on January 4, 2022. In response, on February 3, 2022, Mr. Rotin provided the Rosenbergs with a detailed year-to-year breakdown of distributions to the Harts ($1,191,642) and to the Rosenbergs ($1,118,142) from December 2007 to December 2021. By June 14, 2022, Mr. Rotin provided the Rosenbergs with an Informal Accounting of the Estate, in the form of a Statement of Accounts for the period from February 25, 2007 to April 30, 2022.
103I do not accept the Applicant’s objection that the Trustees failed to communicate with them about the Estate accounting or refused to do so in response to requests for information. This Applicants did not prove this objection on the admissible evidence
(h) The “Miscellaneous” Sampling of Irregularities
104The Applicants raised several alleged discrepancies in the Estate Accounting and Trust Accounting and submitted that, taken together, they support an order that an Auditor or investigator be appointed to investigate all accounts for the 15-year Accounting Periods. The Applicants contended that the list of alleged discrepancies represented “examples”, or a “sampling” of deficient accounting by the Trustees.
105The Trustees submitted that several of the alleged discrete discrepancies were not included in the Notice of Objection and therefore should not be considered, relying on Rule 74.18(12), which provides as follows: “No objection shall be raised at a hearing on a passing of accounts that was not raised in a notice of objection to accounts, unless the court orders otherwise.” Rule 74.18(12) is designed to provide procedural fairness so that the trustee knows what is specifically in issue and has an opportunity to reply: Schutz Estate (Re), 2023 ONSC 3959, at para. 18; In the Estate of Christina Georgiou Psoma, 2025 ONSC 1476, at footnote 26. These principles apply to several complaints set out by the Applicants in their Factum that were not included in their Notice of Objection.3
106In addition to this procedural issue, the Trustees submitted, that raising discrete discrepancies in the Estate Accounting, framed as examples of irregularities, does not prove that there are other discrepancies, does not establish a valid objection, and is insufficient to support an order for an audit of 15-years of Estate Accounts.
107My analysis of the miscellaneous sampling of irregularities concluded that they were either the product of the Applicants’ failure to analyse all of the accounting entries related to an asset, income or disbursement, taken together, or they were modest in value and, in some cases de minimis. This is seen by the following analysis of certain of the discrete, “miscellaneous” discrepancies:
(a) The Applicants’ Notice of Objection, para. 5(a), as expanded upon in para. 49 of the Applicants’ Factum, objects that the Deceased’s date of death holdings in his Investors Group account was $1,334,336.95, whereas the opening balance in the Estate Accounting for these holdings was $1,334,336.96. This discrepancy of one cent is not meaningful.
(b) The Applicants objected, in para. 5(b) of the Notice of Objection, that the starting value of the Deceased’s investments held at Toron/Cidel were listed as $752,020.86 in the Probate Application but were listed as $743,512.04 in the Estate Accounting. The Trustees showed that this was attributable to the date of the book values used in the accounting.
(c) The Applicants objected that the Trustees did not include the Rosenberg Mortgage and the Hart Mortgage as assets of the Estate in the Probate Application. The Trustees conceded this omission but included the Rosenberg Mortgage and the Hart Mortgage in the Estate Accounting.
(d) The Applicants objected, in para. 5(i) of the Notice of Objection, to an original asset belonging to the Deceased of $50,000 that was unaccounted for in the Estate Accounting. The Trustees showed that this amount was withdrawn by the Deceased and provided to Ms. Freedman prior to his death. This amount was not included in the Probate Application or Estate Accounting because it was not an asset of the Deceased at the time of his death.
(e) The Applicants objected, in para. 5(f) of the Notice of Objection, and expanded upon in para. 56 of the Applicant’s Factum, that there was an unaccounted shortage of $19,784.68 in the interest received on a mortgage. The Trustees showed that this amount was accounted for in the Estate Accounting by the addition of Capital Receipt (“CR”) 10, CR-11, CR-12, CR-13, CR-14, CR-21, CR-36, CR-38 to CR-43, inclusive, resulting in Revenue Receipt (“RR”) 78.
(f) The Applicants showed a discrepancy between the balances in Bank of Nova Scotia accounts set out in the Probate Application as opposed to slightly different values used in the Estate Accounting. The Trustees showed that the values used in the Probate Application were estimates and the values used in the Estate Accounting were accurate.
(g) The Applicants’ complaints of the tax treatment of certain Estate assets in the Terminal Tax Return were, in my view, not properly part of a Passing of Accounts Application which is not a tax audit.
(h) In para. 62 of their Factum, the Applicants objected that the Estate received a “retainer refund” from the “Hart bankruptcy” in the amount of $921.44 that was credited only to the Hart Trust, thereby denying the Rosenberg Trust of 50% of the refund ($460.72). This refund is, on its face, attributable to the Hart Trust and, taken at its highest, would constitute a modest discrepancy in the Estate Accounting.
(i) In para. 63 of their Factum, the Applicants objected that the Deceased’s Investor Group Account was closed on December 10, 2010 with a value of $1,304,228.87, but yet the Estate Accounts showed a Capital Receipt of only $1,143,216.57. The Trustees showed that Capital Receipts, CR-80 and CR-81, and Investment Receipt (“IR”) 69, when taken together, show that the full amount of $1,304,228.87 was received by the Estate and included in the Estate Accounting.
(j) The Applicants objected that the Trustees should have calculated all foreign currency exchanges individually and that “without the calculations all the numbers used are corrupt”. The Trustees showed that the exchange transactions were capable of being analysed through the Estate Accounting. Further, Mr. Szarfer conceded, in cross-examination, that he could complete the currency exchange analysis using the Estate Accounting.
(k) In para. 68 of their Factum, the Applicants objected that the Estate Accounts shows $7,658.87 (CR-209) for a Province of Ontario investment that is shown in the Toron/Cidel records as having a value of $8,882.59. The Trustees showed that $8,882.59 is properly reflected in the Estate Accounts as the combination of CR-209 and Revenue Receipt (“RR”) 715 which accounts for the interest earned on the bond.
(l) Similarly, the Trustees showed that other examples of alleged discrete discrepancies objected to by the Applicants in their Factum, including at paras. 66, 67, 69 and 70, but not in their Notice of Objection, were capable of being reconciled by assessment and calculation of several accounting entries, including CR, RR, IR and Investment Disbursements (“IR”). The Trustees showed that the Applicants’ complaint emanated from focusing on only one of the accounting entries without reference to other applicable, related accounting entries.
108The Trustees skilfully responded to the Applicants’ miscellaneous sampling of irregularities, whether selected from the Notice of Objection or raised for the first time in the Applicants’ Factum. The Applicants did not establish that the miscellaneous sampling of irregularities supported an order to decline the passing of the Estate Accounts or the Trust Accounts
(i) Improper Delegation to Toron/Cidel
109The Applicants objected that the Trustees improperly delegated their investment management of the Estate capital to Toron/Cidel. This objection is met by Clause 7 of the Primary Will, which authorizes the Trustees to “retain any of my investments or assets in the form existing at the date of my death in its absolute discretion without responsibility for loss.” Further, Clause 8 of the Primary Will authorizes the Trustees to “make investments in mutual funds or other forms of pooled investments notwithstanding that such investments may not be authorized by law for trustees or may be considered a delegation of their investment duties, and the Trustees shall not be liable for any loss that may happen to any of the said trust funds”.
110Additionally, the Applicants did not establish any monetary loss resulting from the manner by which the Trustees managed the capital of the Estate with the assistance of Toron/Cidel. Mr. Rotin showed that the Estate assets held at Toron/Cidel achieved a rate of return during the Accounting Period of 6.2%, which was well in excess of the Guaranteed Investment Certificate rate for the same period.
111I find that the Applicants’ objection to the Trustees’ holding of Estate capital with the investment management assistance of Toron/Cidel is without merit and thereby denied.
(j) Failure to Allocate Expenses Equally Amongst All Trusts
112After the Deceased’s death, the Trustees settled the Klein Trust, the Dylan Klein Trust and the Freedman Trust, and held the bulk of the capital of the Estate in the Estate Account. The Applicants objected that while the Klein Trust, the Dylan Klein Trust and the Freedman Trust were settled in November 2007, that the Hart Trust and Rosenberg Trust were not settled until August 26, 2020, although established in 2007. This objection failed to recognize that the Hart Trust and the Rosenberg Trust were also established in 2007, although the residue from the Estate Account was not settled into these trusts until August 26, 2020.
113I accept the Trustees’ evidence that the bulk of the Estate capital was kept in a single account, to keep administration costs to a minimum and to improve returns. I see no basis for objection in the Trustees’ decision to manage the Estate capital in this manner, which was authorized by Clause 7 of the Primary Will: “My Trustee shall have separate and substantive power to retain any of my investments or assets in the form existing at the date of my death in its absolute discretion without responsibility for loss…”
114The Applicants objected that the management fees of Toron/Cidel, and the accounting fees of Mr. Rotin and the legal fees of Mr. Lipman were paid entirely from the Estate Account without allocation in part to the Freedman Trust, the Klein Trust and the Dylan Klein Trust. In particular, the Applicants submitted that there should have been a pro-rated allocation of 8% of the professional fees to the Freedman Trust.
115I reject this objection for two reasons. First, I accept Mr. Lipman’s evidence that the legal and accounting services provided by the Trustees were overwhelmingly in management of the Rosenberg Trust and the Hart Trust and not the Freedman Trust, and certainly not the Klein Trust or the Dylan Klein Trust. I accept Mr. Lipman’s evidence that he did not do any legal work for the Freedman Trust or the Klein Trust, but rather that it was the Rosenbergs and the Harts who were frequently demanding encroachments. Second, even if a proportionate share of the professional and management fees ought to have been allocated to the Freedman Trust, this would not have benefited the Rosenbergs or the Harts, in any event. As explained, the amount remaining in the Freedman Trust at the time of Ms. Freedman’s death would form part of the residue of the Estate, and thereby be transferred to the Rosenberg Trust and the Hart Trust, as occurred. If a portion of the management, legal and accounting fees had been allocated to the Freedman Trust, it would have resulted in a reduction in the $187,000 remaining in the Freedman Trust at the time of Ms. Freedman’s death and thereby a corresponding reduction in the amount available for transfer to the Rosenberg Trust and the Hart Trust. The proportionate allocation of fees to the Freedman Trust claimed by the Applicants would not have resulted in any benefit to Applicants as it would simply have reduced the remainder transferred to the Rosenberg Trust and the Hart Trust upon Ms. Freedman’s death.
(k) The Pre-Taking of Professional and Management Fees
116The Applicants objected to the Trustees paying professional fees prior to passing their accounts and submitted that the Trustees should repay the amount of these fees to the Estate Account. The Applicants submitted, based on Mr. Szafer’s calculations, that these fees consist of $220,264.24 in management fees paid to Toron/Cidel, $178,033.04 in accountant’s fees billed by Mr. Rotin and $74,864.65 in legal fees billed by Mr. Lipman during the 15-year Accounting Period. The Trustees showed that the amounts complained of by the Applicants were overstated. The actual accounting fees billed by Mr. Rotin’s firm during the Estate Accounting Period were $170,575.04 and the actual legal fees billed by Mr. Lipman’s firm were $68,819.15. The Toron/Cidel management fees were 1.25% flat per year, charged monthly, until June 2009 when the fees were reduced to 0.8% flat per year on all accounts. In 2018, Toron/Cidel began charging quarterly.
117Mr. Lipman and Mr. Rotin deposed that they charged professional fees based on their hourly rates for docketed time. Mr. Lipman produced 18 invoices issued by Lipman, Zener & Waxman LLP, ranging in date from October 2, 2007 to June 7, 2021, each said to be for professional legal services in the administration of the Estate, in support of the amounts already paid to his law firm (the “Lipman LLP Invoices”). Mr. Rotin produced some 21 invoices issued by Segal LLP, ranging in date from November 8, 2006 to April 30, 2021, each said to be for professional accounting services in the administration of the Estate, in support of the amounts already paid to his accounting firm (the “Segal LLP Invoices”).
118By paragraph 11 of the Primary Will, the Trustees are authorized to “retain professional advisers of any sort to act as its agent or to aid it in the administration of my estate and to pay out of the capital or income of my estate, in its absolute discretion reasonable remuneration to any such professional advisers.” This authority applies to the management fees paid to Toron/Cidel, particularly when considered along with Clause 8 of the Primary Will, referred to earlier. In my view, the payment of the Toron/Cidel management fees as they were incurred was permitted by the Primary Will.
119Paragraph 16 of the Primary Will provides for payment of the legal and accounting fees as incurred, as follows:
I DIRECT that any of my Trustee being a chartered accountant or solicitor or engaged in any other profession or business must make or be paid all usual professional and other charges for work done by him or his firm or any member thereof in relation to the administration of this my Will in the same manner in all respects as if he were not one of the Trustee, …
120The Applicants relied on two authorities in support of their submission that the Trustees should not have pre-taken professional fees until the passing of accounts: DeLorenzo v. Beresh, 2010 ONSC 5655, 62 E.T.R. (3d) 65, at paras. 15-21; and Coppel v. Coppel Estate, [2001] O.J. No. 5246, at paras. 8-10. However, as observed in Furtney v. Furtney, 2014 ONSC 3774, 100 E.T.R. (3d) 312, at para. 43, these decisions were not informed by s. 23.1(1) of the Trustee Act, R.S.O. 1990, c. T.23, which provides that “[a] trustee who is of the opinion that an expense would be properly incurred in carry out the trust may … pay the expensed directly from the trust property or pay the expense personally and recover a corresponding amount from the trust property.” Further, the Supreme Court instructed, in Geffen v. Goodman Estate, [1991] 2 S.C.R. 353 (S.C.C.), at p. 357, that “[t]he courts have long held that trustees are entitled to be indemnified for all costs, including legal costs, which they have reasonably incurred.”
121To the extent that the Lipman LLP Invoices and the Segal LLP Invoices were rendered purely for the provision of legal and accounting services, their payment does not constitute a pre-taking any more than if the Trustees had paid a third-party lawyer or accountant for legal or accounting services required by Trustees for the orderly administration of the Estate. This is permissible under the terms of the Primary Will, under the principles set out in Geffen, and under s. 23.1 of the Trustee Act.
122The Applicants objected, however, that the Lipman LLP Invoices and the Segal LLP Invoices include not only legal and professional services but also pre-taking of estate trustee compensation. The law is clear that estate trustees cannot pre-take compensation without authority derived from the will or approval of their accounts: McDougall Estate, 2011 ONSC 4189, 69 E.T.R. (3d) 280, at para. 52; Freeman Estate, (Re) (Ont. S.C.), at paras. 43-44. Here, the Wills and the Codicil do not authorize the pre-taking of estate trustee compensation, and the taking of compensation was not approved. I will address this issue as part of my analysis of the Applicants’ objection on the issue of trustee compensation.
(l) Determination of the Objection on the Estate Trustees’ Compensation
(i) Applicable Legal Principles
123The principles that guide the Court’s determination of a trustee’s claim for compensation were summarized in Antzon v. Rogovsky, 2025 ONSC 915, at paras. 59-62. I adopt that analysis here.
124Section 61(1) of the Trustee Act provides that “[a] trustee, guardian or personal representative is entitled to such fair and reasonable allowance for the care, pains and trouble, and the time expended in and about the estate, as may be allowed by a judge of the Superior Court of Justice.” Section 23(2) of the Trustee Act provides that the amount of compensation can be fixed upon a passing of accounts.
125In Laing Estate v. Hines, (1998), 41 O.R. (3d) 571 (Ont. C.A.), the Court of Appeal explained that to provide predictability to the assessment of trustees’ compensation, the practice was established to determine the compensation as a percentage of the probate value of the estate. Applying the practice first described in Re Jeffrey Estate, (1990), 39 E.T.R. 173 (Ont. Surr. Ct.), at para. 7, the Court of Appeal endorsed what is commonly referred to as the “Tariff Guidelines”:
[I]n Ontario at least, a practice has developed of awarding compensation on the basis of 2½% percentages against the four categories of capital receipts, capital disbursements, revenue receipts and revenue disbursements along with, in appropriate cases, a management fee of 2/5 of 1% per annum on the gross value of the estate.
126The determination of trustee compensation is not, however, a purely arithmetic exercise but rather a search for a “fair and reasonable allowance for the [trustee’s] care, pains and trouble” in the factual context of the trustee’s administration of the trust. The determination of a “fair and reasonable allowance” is guided by an analysis of the five factors set out in Toronto General Trusts v. Central Ontario Railway,” and endorsed by the Court of Appeal in Laing Estate as follows (Laing Estate, at paras. 5 and 6, applying Toronto General Trusts Corp. v. Central Ontario Railway (1905), 6 O.W.R. 350 (Ont. H.C.)): “(a) the magnitude of the trust; (b) the care and responsibility springing therefrom; (c) the time occupied in performing its duties; (d) the skill and ability displayed; (e) the success which has attended its administration.” The Court of Appeal adopted the two-step process for determination of estate trustee compensation set down by Killeen J. in Re Jeffrey Estate, wherein the judge first calculates the amount of compensation derived from the Tariff Guidelines, and then must cross-check or confirm the mathematical result against the five factors: Laing Estate, at para. 8, citing Re Jeffrey Estate, at para. 16. The Court explained this as follows: “To me, the case law and common sense dictate that the audit judge should first test the compensation claims using the "percentages" approach and then, as it were, cross-check or confirm the mathematical result against the "five-factors" approach set out in Re Toronto General Trusts and Central Ontario Railway, supra.”
127This two-stage approach to determining trustee compensation is well-established: Feinstein v. Freedman, 2021 ONSC 1493, at paras. 65 and 105-108; Aber Estate, Re, 2015 ONSC 5123, 12 E.T.R. (4th) 42, at para. 18; Lis v. Korol, 2024 ONSC 1316, at paras. 67-70; Fitzhenry v. Stevens, 2023 ONSC 5645, at para. 35; Williams v. Crate, 2023 ONSC 4470, at paras. 53-56; Estate of Georgia Manos, 2023 ONSC 1962, at para. 81. The Court must ultimately determine the amount of compensation that is fair and reasonable in the context of the case: In Re Atkinson, [1952] O.R. 685 (C.A.), at p. 698.
(ii) The Parties’ Positions on Compensation
128The Trustees claimed compensation in the Estate Accounting Application in the amount of $227,416.29 inclusive of HST,4 as shown in the Statement of Executors’ Compensation for the Estate Accounting Period. The Trustees do not seek compensation for the administration of the U.S. dollar/foreign currency accounts, but only the Canadian based Estate Accounts. The Trustees claimed that the total compensation be paid 50% out of the Rosenberg Trust and 50% out of the Hart Trust on the basis that the compensation was regarding services provided to the Estate, the residue of which was distributed to these Trusts in equal shares.
129Of the $4,689,086.55 in Capital Receipts, the Trustees backed out transfer items ($1,791,435), foreign exchange transfers ($69,647.17), losses on disposition ($122,724.19) and refund items ($37,768.81), and claimed 2.5% in compensation on net Capital Receipts of $2,665,686.38, totaling $66,642.16. Of the $3,795,983.71 in Capital Disbursements, the Trustees backed out transfer items ($1,986,364.98), foreign exchange transfers ($37,611.57), refunds ($37,768.81) and losses on disposition ($122,724.19), and claimed 2.5% on net Capital Disbursements of $1,611,514.16, totaling $40,287.85. The Trustees then claimed 2.5% of Revenue Receipts of $700,363.34 totaling $17,509.08, and 2.5% of Revenue Disbursements of $1,580,182.39 totaling $39,504.56. The Trustees then applied a Care & Management Fee of 4% on $2,076,210 for a period of 14 years and 310 days, totalling $123,321.19. This totaled $287,264.84 in trustees’ compensation for the Estate.5 The Trustees then deducted 25% of the legal fees ($68,819.15) and accounting fees ($170,575.04) billed during the Estate Accounting Period on the concession that there could have been “overlap” in the services provided as lawyer and accountant and the services provided as estate trustees. This constituted a total deduction of $59,848.55 for a total claim for compensation of $227,416.29 inclusive of HST.6
130The Trustees claimed compensation in the Rosenberg Trust Accounting Application in the amount of $14,071.59 inclusive of HST, as shown in the Statement of Trustees’ Compensation for the Trust Accounting Period. Of the $777,595.97 in Capital Receipts, the Trustees backed out transfer items ($717,689.33) and losses on disposition ($20,519.19) and claimed 2.5% in compensation on net Capital Receipts of $39,387.45, totaling $984.69. Of the $433,638.19 in Capital Disbursements, the Trustees backed out transfer items ($321,222.22) and losses on disposition ($20,519.10) and claimed 2.5% in compensation on net Capital Disbursements of $91,896.78, totaling $2,297.42. The Trustees then claimed 2.5% of Revenue Receipts of $34,292.94, totaling $857.32, and 2.5% of Revenue Disbursements of $130,000, totaling $3,250. The Trustees claimed a Care & Management Fee of 2/5ths of 1% per annum on average market value of $711,490 for a period of 2 years and 127 days, totaling $6,682.16. This produced a total claim for compensation of the Rosenberg Trust Accounts of $14,071.59, inclusive of HST.7
131The Applicants objected to the Trustees’ claim for compensation in the Estate Accounting Application and in the Trust Accounting Application principally on two grounds. First, that the Trustees had agreed to receive only professional fees and not to claim compensation in the administration of the Estate and the Rosenberg Trust. Second, that the Trustees’ claim for compensation is excessive, and that the professional fees that they have received ought to stand in place of compensation, at least in part if not entirely.
(iii) Analysis – Trustee Compensation
132The Applicants claimed that the Trustees waived any entitlement to compensation based on the sworn evidence tendered by Mr. Lipman and Mr. Rotin in January 2023, as follows:
In our roles as estate trustees, Mr. Rotin and I would docket our time, and render invoices when appropriate to pay for our professional fees, as per the terms of the Will.
… By charging on an hourly basis only our professional fees, I believe that our fees have been lower than they would have otherwise been had we charged the ordinary tariff percentages with a care and management fee.8
133This changed by February 7, 2025, when the Trustees’ lawyer notified the Applicants that their conduct caused the Trustees to seek compensation, writing, in pertinent part, as follows:
Allan Lipman and Robbie Rotin have always been entitled to charge compensation at the ordinary tariff rate for their work as estate trustees and as trustees of the trusts. Since the date of Harold’s death, and as explained in the affidavit of Mr. Lipman affirmed January 27, 2023, and as shown in the informal accounting we provided on November 28, 2023, the estate trustees only ever claimed their professional fees – not compensation.
Given that your clients seem intent on causing a maximum amount of aggravation for Mr. Lipman and Mr. Rotin, my client’s will be seeking Executor’s compensation.
134Mr. Lipman candidly deposed that he and Mr. Rotin did not intend to seek compensation throughout the time of their administration of the Estate, until their recent change of mind, as follows:
It is no secret that Robbie and I did not plan to seek compensation for our roles as Trustees; however, we never waived our rights.
135The Applicants did not establish any legal basis, or any case authority to support their submission that the Trustees are foreclosed from seeking compensation by reason of the statements made in their affidavits. First, the Trustees’ statements do not, in my view, constitute an oral agreement to waive compensation. Second, even if these statements constitute a representation that the Trustees would disclaim compensation, they were made in the sixteenth year of administration of the Estate, so there could be no reliance by the Applicants on any such representation. Third, even if the statements supported an interpretation that the Trustees promised to decline compensation, there is no evidence that any such promise was supported by consideration.
136Without commenting on the appropriateness of the Trustees’ reversal of their long-standing plan “to not seek compensation” as a reaction to the Applicants’ decision to institute litigation, the statement made by the Trustees’ lawyers in their letter of February 7, 2025 does align with the basis for trustee compensation as set out in s. 61(1) of the Trustee Act: “fair and reasonable allowance for the care, pains and trouble, and the time expended in and about the estate.”
137In Assaf Estate (Re), 94 O.R. (3d) 561 (Ont. S.C.), at para. 151, the Court held that “exceptional misconduct or serious misconduct will deprive the trustee of compensation altogether.” Here, the Applicants did not plead or seek to establish any exceptional or serious misconduct on the part of the Trustees.
138The Trustees have established an entitlement to compensation for their services as estate trustees. I turn then to an analysis of the amount of compensation for the Accounting Periods that is just, fair and reasonable, in the circumstances of this Estate. The Wills and the Codicil do not inform the compensation analysis because these testamentary instruments do not provide for compensation: indeed, they do not even contain the word “compensation”.
1. First Step – Applying the Tariff Guidelines
139I begin then with the Trustees’ treatment of the Tariff Guidelines. There was no contest that the Trustees’ application of the Tariff Guidelines was computed correctly, in both the Estate Accounting and the Trust Accounting, in computing 2.5% of net allowable Capital Receipts, Capital Disbursements, Revenue Receipts and Revenue Disbursements, and that the elements of each of these categories that ought to have been backed out were, correctly, backed out. The parties’ disputed two components in the compensation calculation:
(a) The Trustees deducted 25% of the legal fees and accounting fees billed during the Estate Accounting Period ($59,848.55),9 whereas the Applicants submitted that 100% of the legal fees and accounting fees ($239,394.19),10 must be deducted to avoid “double dipping”; and
(b) The Trustees claimed a Care & Management Fee in each of the Estate Accounting and the Trust Accounting. The Applicants contended that this was excessive and unwarranted.
140I will address these issues in order.
####### a. Professional Fees or Trustee Compensation?
141The Applicants objected that “[b]y their own words, the Estate Trustees have already taken compensation over the years in the form of legal fees and management fees and accounting fees … and are not entitled to any further compensation.” This objection required analysis of the Lipman LLP Invoices and the Segal LLP Invoices to determine whether they were in relation to lawyer and accounting services, respectively, or services as estate trustees, or both.
142The earliest Lipman LLP Invoices show legal services required by the Estate, including by way of example: preparation of the Probate Application for the issuance of the Certificate of Appointment; supporting affidavits for waiver of estate administration bond; delivering further materials to the Court in support of the probate; and calculation of probate fees. Many of the Lipman LLP Invoices do not contain a clear description of the services provided, but rather describe only generic services, including by way of example: “ongoing correspondence and communications”; “attending to discussing matters”; and “attending to numerous ancillary services, communications and advice in connection with the foregoing not enumerated herein”. And certain of the Lipman LLP Invoices describe services that are clearly provided by an estate trustee, including by way of example: “numerous discussions with Robbie Rotin”; “ongoing review of administration of estate”; “ongoing review of requests for encroachments”; and discussions with beneficiaries.
143The Segal LLP Invoices have the same characteristics. Certain of the invoices contain description of services provided by an accountant, including by way of example: preparation and filing of tax returns; completion of tax reports; addressing Canada Revenue Agency (“CRA”) Notice of Assessments and discussions with the CRA; research regarding Canada and U.S. tax issues; tax research on the use of capital losses; Terminal Tax Return and assessment; tax returns for the Trusts. Indeed, Mr. Rotin at times billed the Estate for the preparation of personal tax returns for the beneficiaries. Many of the Segal LLP Invoices do not contain a clear description of the services provided, but rather describe only generic services, including by way of example: “discussions and correspondence related to the above”. And certain of the Segal LLP Invoices describe services that are clearly provided by an estate trustee, including by way of example: discussions with co-Trustee, Mr. Lipman; discussions with Toron/Cidel representatives regarding investments; contact with financial institutions “for probate purposes”; meeting with and discussions with the beneficiaries; providing beneficiaries with copies of the Wills; “banking for the estate during the period”; and correspondence to arrange for beneficiary distributions.
144In the course of his cross-examination, Mr. Lipman provided an undertaking to use his best efforts to indicate which of the docket entries on a six-page excerpt provided by the Applicants are "legal fees, which are trustee fees, or a blend, or should not be included at all.”11 Mr. Lipman responded to this undertaking by stating that the task of drafting documents constituted professional services, that “other tasks could be defined as a mixture of professional and trustee work” and that “[i]t is always necessary for estate trustees and professionals to communicate with non-parties in the exercise of their duties”.
145In the course of his cross-examination, Mr. Rotin swore that he docketed his time, had dockets in support of his invoices for some of the years in the Accounting Periods, and took under advisement the Applicants’ request that he advise of “how far back do the dockets go and produce what is available” (“U/A #9).12 The Applicants’ request for the production of dockets was consistent with the request for production of dockets made on September 27, 2025 in para. 27 of the Notice of Objection.13 Mr. Rotin refused to answer U/A #9, writing as follows:
This is a refusal. The request is overbroad and of minimal relevance. The invoices themselves have already been produced.
146The refusal by the Trustees to provide the requested docket entries was improper. The dockets were material to the determination of whether the services set out in the Lipman LLP Invoices and the Segal LLP Invoices were in relation to the provision of legal and accounting services, respectively, or services as estate trustee, or both. This was placed firmly in issue by the Applicants’ objection to the Trustees’ pre-taking of professional fees and by the Trustees’ claim for compensation, also objected to by the Applicants. The Trustees had a duty to disclose the extent of their dockets, and to produce available dockets for the Accounting Periods, “without the need for a court to intervene to compel their adherence”, “whether or not the document helps or hurts the party’s case”: Falcon Lumber Limited v. 2480375 Ontario Inc. (GN Mouldings and Doors), 2020 ONCA 310, at paras. 42-43. The Rules are intended to ensure that parties have all the relevant information in a timely manner: Rimon v. CBC Dragon Inc., 2024 ONCA 128, at para. 25.
147It is open to the court to draw an adverse inference against the Trustees based on their failure to produce relevant documents, in this case the dockets, by inferring that the dockets would not have supported the Trustees’ claim for compensation, although such an adverse inference must be approached cautiously: Conte v. Pettle, 2024 ONCA 733, at para. 12; Parris v. Laidley, 2012 ONCA 755, at para. 2. It is also open to the court to reduce the weight to be attributed to Mr. Lipman’s evidence by reason of his improper refusal to produce material evidence: Riva Plumbing Limited v. Ferrari, 2025 ONSC 3219, at para. 279.
148I find that the Lipman LLP Invoices did not pertain entirely to legal services rendered by Mr. Lipman but also contains billing for services rendered as an estate trustee. Similarly, I find that the Segal LLP invoices did not pertain entirely to accounting services rendered by Mr. Rotin but also contains billing for services rendered as an estate trustee. Mr. Lipman and Mr. Rotin should have kept separate records and dockets, for their legal and accounting services, respectively, and for their services as estate trustee. In Laing Estate, at para. 15, the Court of Appeal explained that “[t]here can be no doubt that time spent is one of the relevant factors in fixing compensation” and that no one could argue “with the proposition that trustees of large estates would be well advised to thoroughly document their time spent on work related to the estate.” It is not surprising that Mr. Lipman and Mr. Rotin did not do so, considering that for some 16 years of their estate administration they did not intend to seek trustee compensation.
149Mr. Lipman and Mr. Rotin were permitted to bill during the Accounting Periods (pre-take) solely for their legal and accounting services. Mr. Lipman and Mr. Rotin were not, however, permitted to pre-take compensation for their services as estate trustees. To the extent that they did by delivering “blended” invoices, they improperly received compensation without authority under the Wills and Codicil and without approval.
150The amount of legal and accounting fees billed, and already paid, which relate to the performance of duties as estate trustees must be deducted from the compensation claimed by the Trustees: Freeman Estate, (Re) (Ont. S.C.), at para. 39. It would not be reasonable or fair for the Estate to be charged twice for the same work. Indeed, the Trustees have already acknowledged this by proposing a deduction in compensation of 25% of the amounts billed under the Lipman LLP Invoices and the Segal LLP Invoices. However, based on details set out in the Lipman LLP Invoices and the Segal LLP Invoices, the parties’ evidence and the Estate Accounts and the Trust Accounts, I find that the 25% deduction under-states the portion of the Lipman LLP Invoices and the Segal LLP Invoices that pertained to services as estate trustees.
151Having analysed the available evidence and having considered the parties’ submissions, on the basis of the analysis now explained, I conclude that a deduction of 50% of the professional fees is fair and reasonable in the determination of trustee compensation.
####### b. Is a Care & Management Fee Warranted?
152In Jeffrey Estate, at p. 6, the Court explained that a Care & Management Fee “requires special circumstances and will not be allowed automatically or routinely”. In applying this principle in Archibald Estate, Re, at para. 23 (Ont. SCJ), the court explained as follows:
It is understandable that the court would require some special circumstance before awarding a care and management fee because the percentage approach already provides a predictable way to measure a quantum meruit compensation for the wide range of duties performed by executors including the management of the estate's assets. In other words, routinely or automatically awarding a care and management fee would be double counting for the quantum meruit encompassed by the percentage award made on the incoming and outgoing of capital and revenue.
153The special circumstance supporting a Care & Management Fee in the context of these Accounting Applications is that the Wills and Codicil created several trusts that required ongoing management and investment: Irwin v. Robinson, at para. 72 (Ont. S.C.). This ongoing estate trustee duty supports the granting of a Care & Management Fee as the Trusts were an important component of the administration of this Estate.
154However, I have taken into consideration that the Trustees largely delegated the ongoing investment management to Toron/Cidel. I have accepted that this manner of investment management was permissible under the Wills and Codicil, and I have explained my finding that the pre-taking of the investment management fees of Toron/Cidel was proper. I find that the delegation to Toron/Cidel largely removed the weight of the Trustees’ investment of the Estate assets but nonetheless left the Trustees with the ongoing management of the Trusts, including dealing with the beneficiaries’ needs. An award of the entirety of the Care & Management Fee sought by the Trustees would, in my view, be duplicative of the investment management fee already paid to Toron/Cidel. For these reasons, I reduce the Trustees’ claim for a Care & Management Fee in either the Estate Accounting or the Trustee Accounting to 50% of the amount claimed.
2. The Trustees’ Compensation Using the Tariff Guidelines
155With reference to the Tariff Guidelines, I accept that the Trustees have shown that in the Estate Accounting, 2.5% of the net Capital Receipts produced $66,642.16; that 2.5% of the net Capital Disbursements produced $40,287.85; that 2.5% of the Revenue Receipts produced $17,509.08; and that 2.5% of the Revenue Disbursements produced $39,504.56, for a total of $163,943.65. From this amount, I deduct 50% of the invoices for accounting and legal services during the period, specifically, $119,697.09.14 This produces compensation of $44,246.56.15 To this amount, I will add a Care & Management Fee of 50% of the amount claimed, specifically $61,660.59.16 This produces total compensation for the Estate Accounting Period under the Tariff Guidelines of $105,907.15.
156With reference to the Tariff Guidelines, I accept that the Trustees have shown that in the Trust Accounting, 2.5% of the net Capital Receipts produced $984.69; that 2.5% of the net Capital Disbursements produced $2,297.42; that 2.5% of the Revenue Receipts produced $857.32; and that 2.5% of the Revenue Disbursements produced $3,250.00, for a total of $7,389.43. To this amount, I will add a Care & Management Fee of 50% of the amount claimed, specifically $3,341.08.17 This produces total compensation for the Trust Accounting Period under the Tariff Guidelines of $10,730.51.
3. Second Step – Cross-Checking the Mathematical Result Using the Five Factors
157I turn to the second stage of the estate trustee compensation analysis, specifically, a consideration of the five factors to determine whether the compensation derived from the Tariff Guidelines is fair and reasonable for the Trustees’ “care, pains and trouble” and time in the administration of the Estate and the Trust.
158The first factor is the value of the Estate and the value of the Trust. The Estate had a date of death value approximating $4 million. This supports the compensation that I have derived under the Tariff Guidelines.
159In considering the second factor, the care and responsibility shown by the Trustees, the Applicants showed that the Trustees received compensation during the Accounting Period because a portion of the Lipman LLP Invoices and the Segal LLP Invoices was in relation to the provision of services as an estate trustee. This pre-taking of compensation was not authorized by the Wills and Codicil and was not approved. The third factor, the time occupied in performing their duties, was provided through the Lipman LLP Invoices and the Segal LLP Invoices, but not in the detail that was required to account for both services as a lawyer or accountant and services as an estate trustee.
160Regarding the fourth factor, I find that Mr. Lipman and Mr. Rotin demonstrated skill and ability in the management of multiple testamentary trusts and the adept administration required to carry out the testator’s intention of safeguarding his children from irresponsibly depleting their inheritance. Considerable time and expense were incurred in meeting the Rosenbergs’ demands for encroachments and analyses of amounts made available to Ms. Freedman. In consideration of the fifth factor, the success of administration, the administration of both the Estate and the Rosenberg Trust are near completion, with only a few discrete steps remaining.
161Based on the second stage analysis using the five factors, I conclude that the compensation computed under the first stage Tariff Guidelines should be reduced to reflect the Estate’s loss of use of funds through the Trustees’ pre-taking of compensation.
B. Conclusion – The Accounts Shall be Passed with Revision to the Amount of Compensation
162In Laing Estate, at para. 10, the Court of Appeal stated, that “[t]he fixing of compensation under s. 61(1) of the Trustee Act is far from an exact science.” Rather, “it is a search for an award which reflects fairness to the executor; in a real sense, the search for an appropriate quantum meruit award in a unique setting”: Laing Estate, at para. 8, citing Jeffrey Estate, at p. 179.
163Regarding the issue of the estate trustees’ compensation, I conclude that the Trustees are entitled to compensation for the Estate Accounting Period, and having considered all relevant factors, I fix this amount as $100,000, inclusive of applicable taxes. I have reduced the amount of monetary compensation produced by the Tariff Guidelines ($105,907.15) in consideration of the loss of interest income to the Estate by the Trustees’ pre-taking of compensation during the Estate Accounting Period.
164I conclude, as well, that the Trustees are entitled to compensation for the Trust Accounting Period, and having considered all relevant factors, I fix this amount as $10,000, inclusive of applicable taxes. I have reduced the amount of monetary compensation produced by the Tariff Guidelines ($10,730.51) in consideration of the loss of interest income to the Trust by the Trustees’ pre-taking of compensation during the Estate Accounting Period.
165I have determined that the remainder of the objections to the Estate Accounts and to the Trust objections are dismissed. Regarding the many now-dismissed objections (all but the issue of compensation), the Courts have cautioned against losing sight of the purpose of a passing of accounts application, specifically, an audit of the estate accounting: In the Matter of the Estate of Pauline Medynski, deceased and In the Matter of the Guardianship of Andrew Medynski, 2016 ONSC 3353, at para. 34, applying Steven Thompson Family Trust v. Thompson et al, 2012 ONSC 7138, 84 E.T.R. (3d) 24, at paras. 27 and 28. The focus is on deficiencies that make a difference to the outcome in that they lend themselves to a monetary or other determination: Medynski, at paras. 10 and 38, applying Eva v. Brook, 2016 ONSC 1496, at para. 61. Many of the Applicants’ objections were based on misperception of an accounting entry, or minor technical errors that had modest impact on the accounting of the beneficiaries’ entitlements or were disproportionate to the cost of the Accounting Applications. As Justice Penny held in Suboch, 2021 ONSC 8246, at para. 9, “[s]ometimes perfection is the enemy of the good” and “minor, technical errors” should not preclude a passing of accounts when their litigation would result in costs and delay that “would far outweigh any discernible benefit.”
166The Estate Accounts and the Trust Accounts shall be passed, with the Trustees’ compensation for the Estate Accounting Period being fixed at $100,000, inclusive of HST, and the Trustees’ compensation for the Trust Accounting Period being fixed at $10,000, inclusive of HST. These awards of compensation shall constitute a credit against any claim by the Trustees for further compensation.
C. The Claim for The Appointment of an Auditor
167Other than the issue of compensation, the Notice of Objection to Accounts does not seek a monetary variation in the Estate Accounts or the Trust Accounts, whether in the nature of a reversal of a specific capital disbursement or a monetary reallocation. The Notice of Objection to Accounts seeks, at paragraph 61(a), the following order:
Requiring the Trustees to turn over all their documentation to an independent third party to conduct an audit and create a proper summary and reallocation of accounts, at the personal expense of the Trustees Alan Lipman and Robbie Rotin.
168Considering that the Applicants’ objections have been dismissed, other than revision to the amount of compensation, the Applicants have not established the entitlement to the remedy of the appointment of an Auditor. However, for completeness of analysis, I will explain why I would not have ordered the appointment of an Auditor even all or some of the objections had been sustained.
169The authority for the appointment of an Auditor, or an Investigator or Inspector, derives from section 49(10) of the Estates Act, which authorizes the court to “appoint an accountant or other skilled person to investigate and to assist him or her in auditing the accounts” where a judge has determined that the accounts “are of an intricate or complicated character and in the judge’s opinion require expert investigation.”
170In Mayer v. Rubin, 2023 ONSC 4214, the court appointed administrator brought a motion for the appointment of an Investigator, under s. 49(10) of the Estates Act. At para., 89, Justice Gilmore observed that the purpose of the Investigator would be to provide the court with a unbiased analysis of the accounts, and that the test for the appointment of the Investigator is analogous to the power to appoint and Investigator pursuant to s. 161 of the Business Corporations Act, R.S.O. 1990, c. B.16, relying on Khavari v. Mizrahi, 2016 ONSC 4934, 61 B.L.R. (5th) 313, at para. 41. These cases show that the appointment of an Auditor or Investigator of an estate’s accounts is discretionary, and that it is an extraordinary remedy that calls for consideration of several factors, including whether the applicant needs access to the information; whether there are better, less expensive means to acquire the information; whether the proposed investigation would give a tactical advantage; and the expense of the investigation as compared to the benefits: Mayer, at para. 89, relying on Khavari at para. 41. In summary, the Court must consider “the appropriateness of the proposed investigation, bearing in mind its usefulness and reasonableness under the circumstances, with due consideration to its expected costs and benefits”: Khavari, at para. 35, applied in Mayer, at para. 89.
171In Mayer, an Investigator was appointed because wrongdoing was alleged in a passing of accounts that was part of seven years of estate litigation that was scheduled for a 30-day hearing, with considerable dysfunction and mistrust between the beneficiaries. Here, the Applicants have admitted that they do not allege any fraud, theft or misappropriation on the part of the Trustees. The Applicants have not satisfied the factors set out in Mayer and Khavari for the appointment of an Auditor.
172There are two further considerations that are fatal to the remedy claimed by the Applicants. First, the Applicants did not propose an Auditor nor give any evidence as to the qualifications, scope of analysis, mandate or expense of an audit. There was no evidence on which to consider the appropriateness of an Auditor or proposed investigation. The absence of any expense estimate, budget, or outline of proposed scope of work or phased or staged approach causes significant concern in appointing an auditor or inspector: Kerbel v. Morris Kerbel Holdings Limited, 2023 ONSC 529, at para. 72. Second, the Applicants could not identify any case in which the costs of an Auditor had been ordered to be paid by the trustees as opposed to the parties seeking the audit. Considering the limited amount remaining in the Estate and the Rosenberg Trust, it would have been inefficient and disproportionate to appoint an Auditor as the resultant expense would not have been to the benefit of the beneficiaries.
173The Applicants’ claim for the appointment of an Auditor is dismissed.
D. Disposition – The Passing of Accounts Applications
174A judgment shall issue passing the accounts in the Estate Accounting Application for the Estate Accounting Period and approving the payment of compensation in the amount of $100,000 inclusive of HST, to be paid 50% from the Hart Trust and 50% from the Rosenberg Trust.
175A judgment shall issue passing the accounts for the Rosenberg Trust in the Trust Accounting Application for the Trust Accounting Period and approving the payment of compensation in the amount of $10,000 inclusive of HST, to be paid from the Rosenberg Trust.
V. ANALYSIS – THE REMOVAL APPLICATION
176In the Removal Application, commenced on November 14, 2022, the Applicants sought an order to remove the Trustees as trustees of the Estate, and to appoint, in their place, a neutral third party as a succeeding estate trustee, and a similar order to remove the Trustees as trustees of the Rosenberg Trust and to appoint, in their place, a neutral third party as a succeeding trustee. As explained earlier, in their Amended Notice of Motion brought in the Removal Application, and in argument at the hearing and in written submissions, the Applicants did not seek the appointment of a neutral third-party trustee in replacement of the Trustees, but rather sought the appointment of Mr. Szarfer and Ms. Perez as succeeding trustees of the Estate and the Rosenberg Trust.
A. Legal Principles Pertaining to Trustee Removal
177Sections 5 and 37 of the Trustee Act provide the Court with authority to remove a trustee and appoint another in their place. Further, the Court has the inherent jurisdiction to remove trustees: Chambers Estate v. Chambers, 2013 ONCA 511, 367 D.L.R. (4th) 151, at para. 101, citing Evans v. Gonder, 2010 ONCA 172, 54 ETR (3d) 193 at para. 42.
178The parties did not dispute the legal principles applicable to the removal of a trustee but rather disagreed on their application to the facts of this Application. The principles that guide the court’s analysis of whether to remove an estate trustee are well-established and were summarized in La Calamita v. La Calamita, 2024 ONSC 4219, 96 E.T.R. (4th) 81, at para. 95, as follows:
(a) The court will remove the estate trustee only if doing so is clearly necessary to ensure the proper administration of the trust: Di Michele v. Di Michele, 2014 ONCA 261, 319 O.A.C. 72, at para. 84; Di Santo v. Di Santo Estate, 2023 ONCA 464, 87 E.T.R. (4th) 167, at para. 26.
(b) The court should not lightly interfere with a testator’s choice of the person to act as his or her estate trustee: Chambers, at para. 95. The wishes of the testator will generally be honoured “even if the person chosen is of bad character”: Chambers, at para. 96.
(c) A court should remove an estate trustee only on the “clearest of evidence” and should be reluctant to pass over a named estate trustee unless “there is no other course to follow”: Chambers, at para. 95.
(d) Even if an estate trustee has not executed their functions perfectly or ideally, “that is not the test”: Taetz v. Mikolajewski, 2023 ONSC 4635, at para. 11; Radford v. Radford Estate (2008), 43 E.T.R. (3d) 74 (S.C.), at para. 120; St Joseph’s Health Centre v. Dzwiekowski (Ont. S.C.), at para. 25. The test is whether the estate is likely to be administered properly in accordance with the fiduciary duty of the trustee and for the benefit of the beneficiaries: Meuse v. Taylor, 2022 ONSC 1436, 161 O.R. (3d) 30, at para. 14; Henderson v. Sands, 2023 ONSC 897, 85 E.T.R. (4th) 182, at para 11.
(e) Friction alone between co-executors is not itself reason for removal: Chambers, at para. 96. For friction to be the basis for removal, it must rise to a level that prevents the proper administration of the estate: Henderson, at para. 8.
(f) Passing over an executor is an “unusual and extreme course”: Chambers, at para. 95. It has been described as an “extreme remedy” and one of “last resort”: Kinnear v. White, 2022 ONSC 2576, at para. 7.
(g) Past misconduct may justify removal if that misconduct is likely to continue in the future. Removal is not intended to punish, but to protect the Estate assets and the interests of the beneficiaries: St Joseph’s Health Centre, at paras. 28–29; Virk v. Brar Estate, 2014 ONSC 4611, E.T.R. (4th) 241, at para. 48.
(h) The Court’s main guide should be the welfare of the beneficiaries: Kinnear, at para. 11, citing Crawford v. Jardine (1997), 20 E.T.R. (2d) 182 (Ont. Gen. Div.), at para. 18; Henderson, at para. 8; Radford, at para. 103; St Joseph’s Health Centre, at para. 26.
179I adopt these principles in my determination of the Applicants’ claim for removal of the Trustees from their administration of the Estate and the Rosenberg Trust.
B. Analysis – Removal of Trustees
180In my view, the Applicants did not establish any basis to remove Mr. Lipman and Mr. Rotin as Trustees of either the Estate or the Rosenberg Trust. This was not a close call. I will explain why.
181My analysis of the Estate Accounting Application and the Trust Accounting Application explained why the objections made by the Applicants to the Estate Accounts and the Trust Accounts were dismissed, apart from the issue of compensation. This accounting covered the Accounting Periods ending December 31, 2022. The period from the Deceased’s death on February 25, 2007 to December 31, 2022 was dominated by a 14-year period of uncontroversial, uneventful administration of the Estate and the Rosenberg Trust, until January 2022. As the Applicants’ claim for removal of the Trustees is not supported by my findings during these Accounting Periods, my analysis shifts to the complaints raised by the Applicants of the Trustees’ conduct in 2022 and onwards.
182Near the end of the Accounting Periods, specifically on January 4, 2022, the Rosenbergs demanded a discharge of the Rosenberg Mortgage and an encroachment of $84,000 on the capital of the Rosenberg Trust. When the Trustees did not immediately comply with these demands, litigation ensued. The Rosenbergs complained that the Trustees had failed in routinely reporting to them and were chronically inaccessible. These allegations were not capable of being established by the Rosenbergs in circumstances in which Mr. Rotin was their accountant, and prepared their annual tax returns, and Mr. Lipman and Mr. Rotin had been responsive to their previous demands for encroachment on capital, including the institutionalized encroachment needed to provide the Rosenbergs with $5,000 each month.
183Tension between the Trustees and the Rosenbergs was inherent in at least two ways that expectedly and intrinsically flowed from how the Deceased chose to structure his Primary Will. These tensions did not arise tangentially or incidentally but were rooted in the Deceased’s estate planning. The first tension was that the Rosenbergs gained from Ms. Freedman receiving less because the remainder of the Freedman Trust would form part of the Estate’s residue to be shared by the Rosenbergs and the Harts. The second tension flowed from the very nature of a “spendthrift trust”. The Trustees were charged with the duty to manage and administer the flow of funds to the Rosenbergs and the Harts, through the instruments of the Rosenberg Trust and the Hart Trust, to protect the Rosenbergs and the Harts from their own financial mismanagement. It could be expected that these beneficiaries would seek encroachments and that the Trustees would have to carefully scrutinize each request to gatekeep the reduction in capital, both for the Harts and the Rosenbergs and as part of their duty to the Remainder Capital Beneficiaries.
184The Applicants do not submit that the Trustees acted maliciously, oppressively, or in bad faith, or in deliberate disregard of the interest of the beneficiaries. Rather, the Applicants’ main submission on removal of the Trustees is that they have acted in “benign neglect” of their duties. The Applicants could not present a single case authority where an estate trustee was removed based on a finding of benign neglect. This is to be expected considering that the courts have held that the test for trustee removal is not whether the trustee has executed their functions “perfectly or ideally”, but rather the test is whether the estate is likely to be administered properly in accordance with the fiduciary duty of the trustees and for the benefit of the beneficiaries, as explained by Gomery J., as she then was, in Meuse, at para. 14:
A person seeking the removal of an estate trustee chosen by a testator must therefore show that removing the trustee is necessary because otherwise the estate will not be properly executed or the property in the estate will be endangered. It is not enough for the applicant to prove that the trustee has made mistakes or neglected their duties in the past. Although the respondent estate trustee might not have executed her functions perfectly or ideally, “that is not the test”. The question instead 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”, as 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”. (Citations omitted).
185Further, the grounds for the Applicants’ submission that the Trustees acted in benign neglect were not established. First, I do not accept that the Trustees have failed to address the well-being of the beneficiaries. The Trustees assembled the estate assets, continued the investments with Toron/Cidel consistent with the authority provided by them under the Primary Will, made encroachments on capital for the benefit of the Rosenbergs, established the Rosenberg Trust and have distributed to the Rosenbergs, during the Accounting Periods, over $1.1 million. Throughout, the Trustees treated the Harts equally, as equal residuary beneficiaries. The Harts, who were common in interest to the Rosenbergs, did not require a formal passing of accounts of either the Estate or the Hart Trust, and did not deliver a single objection to the Estate Accounting. The Harts do not seek the removal of the Trustees from their role in the administration of the Hart Trust. Additionally, the Remainder Capital Beneficiaries did not deliver any objection to the Estate Accounting.
186Second, the Trustees did not act in benign neglect by failing to bring applications to pass the accounts of the Estate and the Rosenberg Trust until ordered, on consent, to do so. The Trustees had already provided an Informal Accounting, which was acceptable to all beneficiaries except the Rosenbergs, and passing of accounts applications are costly.
187Third, I do not accept the Applicants’ submission that Ms. Rosenberg was treated with hostility by the Trustees in their discontinuance of the monthly payment of $5,000 from the Rosenberg Trust. On or about November 1, 2023, the Trustees notified the Applicants that the monthly payments of $5,000 were discontinued because there were insufficient funds in the Rosenberg Trust to allow for these monthly payments. The Trustees provided advance notice to the Applicants of this eventuality by letter dated August 2, 2023: “I wish to make something abundantly clear. There is not much liquidity in the Rosenberg Trust”. The Trustees explained through informal accounting that the Rosenberg Trust contained $420,040.80 as of April 30, 2022, and that the Rosenbergs received $5,000 per month to August 2, 2023 plus $8,333 annually, for a total of $83,333, plus an encroachment of $25,000 plus a further encroachment of $88,400, for a total of $196,700 in a fifteen month period. In addition, the Trustees discharged the Rosenberg Mortgage, removing an encumbrance of $285,000 from title to Ms. Rosenberg’s Edenbridge Property and thereby providing Ms. Rosenberg with the opportunity to sell and monetize, or obtain financing against the equity of the Edenbridge Property.
188On August 11, 2025, the Trustees resumed the monthly payments of $5,000, explaining that $51,308 remained in the Rosenberg Trust. On September 29, 2025, the Estate realized the Deceased’s 50% interest in the Yonge Condo, which was held by the Deceased and Ms. Freedman as equal tenants in common. The sale price was $1,695,000, which would result in net sale proceeds to the Estate of about $800,000, and after payment of liabilities, transfer of the net sale proceeds in equal shares (about $400,000) to the Hart Trust and the Rosenberg Trust. This allowed for the continued payment of $5,000 each month. In this context, I do not accept that the discontinuance of the $5,000 monthly payments from November 1, 2023 to August 2025 was a result of hostility toward the Rosenbergs but rather was the product of insufficient liquid funds to allow for the payments.
189Apart from the Applicants’ contention that the Trustees have acted in “benign neglect”, which I do not accept, an analysis of the established principles governing the removal of trustees, as listed earlier, shows that the Applicants did not establish a basis for removal of the Trustees. I begin with the undisputed finding that the Trustees were the Deceased’s choice to administer his Estate, based on his long history with them in the provision of legal and accounting advice. This choice must be honoured and not lightly interfered with.
190The Deceased’s choice of the Trustees should only be removed on the “clearest of evidence” and only when there is no other course to follow in the remainder of the proper administration of the Estate and the Rosenberg Trust. Removal is not intended to punish for past conduct, even if I had found that there was conduct worthy of sanction but rather must be resorted to when necessary to ensure proper conduct in the tasks remaining for the protection of the beneficiaries in the administration of the Estate. Here, significant components of the administration of the Estate have been concluded. Specifically, the Dylan Trust, the Klein Trust and the Freedman Trust have all been fully administered and the Hart Trust and the Rosenberg Trust are well-established. The Florida Condo and the Yonge Condo have been sold, as has been explained, and the Deceased’s entitlements in these assets has been realized. The Trustees are, in my view, best suited and situated to complete the ongoing administration of the Estate and the Rosenberg Trust.
191Past misconduct may justify removal if the misconduct is likely to continue. Here, the Applicants did not establish any misconduct on the part of the Trustees. There has been friction between the Applicants and the Trustees, including as manifested by the parties’ involvement in these Related Proceedings. Friction alone is not a basis for removal, but rather it must rise to the level of constituting an impediment to the orderly administration of the Estate. In my view, the Trustees have continued to carry out their duties notwithstanding the friction that spawned and perpetuated this litigation.
192Importantly, the principal guide that informs a decision to remove estate trustees is the welfare of the beneficiaries. In my view, the welfare of all beneficiaries, not just Ms. Rosenberg and the Barry Rosenberg Estate, but also the Hart Beneficiaries and the Remainder Capital Beneficiaries, is fostered by the Trustees continuing with their work and completing the administration of the Estate and the Rosenberg Trust. There is no order sought by to remove the Trustees as trustees of the Hart Trust.
193Considering my finding that the Trustees will not be removed from their ongoing appointments, it is not necessary to decide whether Mr. Szarfer and Ms. Perez would have been appointed as succeeding trustees of the Estate and Rosenberg Trust had I granted an order for the removal of the Trustees. However, for completeness of analysis, I will explain why I would not have appointed Mr. Szarfer and Ms. Perez as succeeding trustees but rather would have appointed a neutral, institutional trustee, had I determined that the removal of the Trustees was necessary.
194Mr. Szarfer’s evidence in cross-examination showed that he would have acted as succeeding estate trustee for the benefit of his sister, Ms. Rosenberg, but not necessarily for the benefit of all beneficiaries, and not in furtherance of the Deceased’s intentions, as set out in the Primary Will. Mr. Szarfer testified that if appointed as trustee, he would immediately pay $110,000 to Ms. Rosenberg in compensation for the 22 months in which she did not receive payment of $5,000; that his sister is entitled to the net income of the Rosenberg Trust in addition to the monthly payment of $5,000; and that he did not consider that the Primary Will provided the trustee with direction to consider the entitlements of the Capital Remainder Beneficiaries. Additionally, Mr. Szarfer stated that the trustees of the Rosenberg Trust should sue the Estate, Ms. Freedman’s Estate and the Hart Trust, which would place him in a conflict of interest if appointed as trustee of both the Rosenberg Trust and the Estate. It is trite law that a person will not be appointed as a trustee if that person’s duties to the Estate would conflict with their personal interests: Di Michele, at para. 87. Additionally, based on the nature of the objections that Mr. Szarfer counselled Ms. Rosenberg to raise, and which were dismissed, I was not persuaded that Mr. Szarfer has the experience and skill in estate administration necessary to act as succeeding trustee of the Estate and the Rosenberg Trust.
195Ms. Perez is a Remainder Capital Beneficiary whose objective to be appointed as succeeding estate trustee was not supported by any of the other Remainder Capital Beneficiaries. The Applicants did not establish that Ms. Perez had the experience and skill, impartiality and appreciation of a trustee’s fiduciary duties, to be appointed as succeeding trustee of the Estate or the Rosenberg Trust.
C. Conclusion – There is No Basis for Removal of the Trustees
196The Applicants/Moving Parties had the burden to prove their claim that the Trustees should be removed from their trusteeship of the Estate and the Rosenberg Trust. They were required to do so on the “clearest of evidence” and to show that “there was no other course to follow”: Chambers, at para. 95. They failed to do so. The Removal Application, including the Motion for removal brought within it, is dismissed.
VI. DISPOSITION
197On the basis of these reasons, I order as follows:
(a) Regarding the Application brought in court file number CV-22-00690209-00ES:
(i) This Application, including the Motion for removal brought within it, is dismissed.
(ii) The costs of this Application, including the Motion for removal, shall be determined in accordance with a process to be established.
(b) Regarding the Application brought in court file number CV-25-00743168-00ES:
(i) The accounts of the Estate of Harold Ammon Rosenberg for the accounting period of February 25, 2007 to December 31, 2022 are passed.
(ii) The compensation of the Trustees, Allan Lipman and Robbie Rotin, is fixed in the amount of $100,000 inclusive of HST and shall be paid 50% from the Hart Trust and 50% from the Rosenberg Trust.
(iii) The costs of this Application shall be determined in accordance with a process to be established, with reference to the Request for Increased Costs dated February 2, 2026, delivered by the Trustees, Allan Lipman and Robbie Rotin.
(c) Regarding the Application brought in court file number CV-25-00743169-00ES:
(i) The accounts of the Rosenberg Trust for the accounting period of August 26, 2020 to December 31, 2022 are passed.
(ii) The compensation of the Trustees, Allan Lipman and Robbie Rotin, is fixed in the amount of $10,000 inclusive of HST and shall be paid from the Rosenberg Trust.
(iii) The costs of this Application shall be determined in accordance with a process to be established, with reference to the Request for Increased Costs dated February 2, 2026, delivered by the Trustees, Allan Lipman and Robbie Rotin.
198The Applicants in each Application shall prepare a draft Judgment or draft Judgment on Passing Accounts, as the case may be (collectively, the “Draft Judgments”) and, after approval as to form and content, file the Draft Judgments and approvals on the Case Center bundle used in the hearing of these Related Proceedings (bundle 009 in CV-22-00690209-00ES), and then forward the Draft Judgments, in pdf and word format, to the Court Registrar and to the Estates List Trial Coordinator, to be brought to my attention.
199If the parties cannot agree on the form and terms of the Draft Judgments, they may request, by email to the Estates List Trial Coordinator, the scheduling of a Case Conference before me to settle the form of the Draft Judgments.
VII. COSTS
200The parties are encouraged to confer and to agree on the issue of costs of all the Related Proceedings.
201If the parties cannot agree on the issue of costs, any party seeking costs may, by June 15, 2026, deliver by email to my judicial assistant and to the Estates List Trial Coordinator after service and filing on Case Centre, written submissions of no more than 8 pages plus a Bill of Costs for each of the Applications for which costs are sought. Any party against whom costs are sought may, by July 6, 2026, deliver by email to my judicial assistant and to the Estates List Trial Coordinator after service and filing on Case Centre, responding costs submissions of the same length for each Application for which costs are sought. If the party claiming costs seeks to deliver submissions in reply, they may do so by July 20, 2026.
202If any party seeks costs that have the potential to monetarily impact any person other than the parties who appeared in the hearing of these Related Proceedings, namely, Sara Rosenberg, the Estate of Barry Rosenberg, Allan Lipman and Robbie Rotin, they shall serve their written submissions on costs on any such person and shall arrange a Case Conference to speak to a process to allow any such person an opportunity to make submissions on the issue of costs.
203If no party delivers any written cost submissions by July 20, 2026, I will deem the issue of costs to have been settled.
A.A. Sanfilippo J.
Released: May 25, 2026
CITATION: Rosenberg v. Lipman, 2026 ONSC 3008
COURT FILE NOS.: CV-22-00690209-00ES
CV-25-00743168-00ES
CV-25-00743169-00ES
DATE: 20260525
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
SARA ROSENBERG et al.
Applicants
– and –
ALLAN LIPMAN et al.
Respondents
AND:
IN THE MATTER OF THE PASSING OF ACCOUNTS OF THE ESTATE OF HAROLD AMMON ROSENBERG, DECEASED
AND:
IN THE MATTER OF THE PASSING OF ACCOUNTS OF THE ROSENBERG TRUST
REASONS FOR DECISION
A.A. Sanfilippo J.
Released: May 25, 2026
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Footnotes
- Hearing Exhibit #1, List of Trustees’ Objections and Applicants’ Position. Szarfer #1 Affidavit, at paras. 13, 25(b), 27(b), 27(c), 29(a), 40, 40(a), 40(b), 40(c), 42(c). Szarfer #2 Affidavit, at paras. 3, 4, 5, 6, 7 and 8.
- Hearing Exhibit #1, List of Trustees’ Objections and Applicants’ Position. Szarfer #1 Affidavit, at paras. 6, 7, 8, 11, 31(b), 32(a), 34(a) and 40(g). Szarfer #2 Affidavit, at para. 9.
- Applicants’ Factum, at paras. 62-71, inclusive, and paras. 72-77.
- The Trustees submitted, in their final revised factum, that their claim for compensation in the Estate and the Rosenberg Trust is “plus HST”. However, in their Notice of Application to Pass Accounts in the Estate Accounting Application and their Notice of Application to Pass Accounts in the Trust Accounting Application their claim for compensation is “inclusive of HST”, as it is shown in the accounting and in the Trustees’ draft Judgments in the Estate Accounting Application and in the Trust Accounting Application. I have therefore considered the Trustees’ claim for compensation as “inclusive of HST” notwithstanding the submissions seeking compensation “plus HST” set out their final revised factum.
- $66,642.16 + $40,287.85 + $17,509.08 + $39,504.56 + $123,321.19 = $287,264.84.
- $287,264.84 - $42,643.76 - $17,204.79 = $227,416.29.