Unsuccessful Estate Litigation Leads To Large Costs Award

Not too long ago we wrote about a niece who attempted to remove her uncle as the estate trustee of another one of her uncles. A recent follow-up decision related to costs associated with the unsuccessful bid was just released and serves as a good reminder of the risks of pursuing litigation that does not have a strong chance of succeeding.

The unsuccessful attempt

The court looked at the litigation history between the parties as an explanation of why costs were so high. The uncle was appointed guardian of the deceased’s property and personal care in December 2018. The niece said she was originally appointed powers of attorney for property and personal are in 2017 but she did not know if this until January 2019.

The niece attempted to remove the uncle from his role on the grounds that she didn’t know she had the responsibility originally. She also told the court that the uncle had obtained his original certificate of appointment through fraudulent means, though this allegation was ultimately found to be untrue. Finally, she argued that the uncle was in a conflict of interest because he had once had a legal dispute with the deceased.

Determining costs

The niece had asked the court to defer the issue of costs, asking for the judge hearing the application to pass the accounts of the estate trustee. However, she provided no rationale for this request.

The court found that the uncle was the successful party and was therefore entitled to costs from the niece, stating “estates litigation, like any other form of civil litigation, operates subject to the general civil litigation costs regime, except in a limited number of circumstances where public policy considerations permit the costs of all parties to be paid out of the estate.”

The court was critical of the niece’s approach to litigation, finding she engaged in behaviour worthy of sanction. The court said the conduct was “reprehensible. scandalous, and outrageous.”

The court went on to explain that unfounded allegations of misconduct and personal attacks on the propriety of an estate trustee can attract an elevated costs award. Despite such situations arising in “rare and exceptional” circumstances, this situation warranted these measures. The court ultimately determined the niece should be required to pay $48,975.94 from her portion of the estate.

If you are the friend or family member of a testator and are concerned about the appointed trustee or executor, contact Derfel Estate Law. Our Toronto estates lawyers help clients ensure that their interests or the interests of their loved ones are protected, and decisions are being made in the best interests of the estate. Call us at 416-847-3580 or contact us online to schedule a consultation