Being named executor or trustee of an estate is a serious responsibility. There are a number of things to take care of, deadlines to remember, and parties to work with. People who find themselves appointed as a trustee or executor often find themselves fulfilling that role for the first time, and may not have the knowledge or skillset to properly fulfill their obligations or act in the best interests of the estate. A decision from the Ontario Court of Appeal looks at one situation where an executor’s failure to act led to an expensive lesson to learn.

Close, but still too late

In 2007 the deceased in the case had lent the respondent $55,000. The loan was secured by a promissory note that stated the loan was payable on demand or upon the sale of a specified piece of property, whichever occurred first. When the deceased passed away, the appellant was named as the executor of the estate.

The appellant learned that the property named in the promissory note had been sold on June 6, 2013 (the appellant was already acting as executor at this time). While they made a demand for repayment in May 2015, it was not until July 17, 2015 that the appellant commenced an action to recover the loan.

Unfortunately, Ontario’s Limitations Act states that the time within which an estate trustee can bring a claim that the deceased person had before death is two years. The appellant missed that two-year window by just over a month.

The original decision was decided via summary judgment by a motion judge who ruled that the action was statute barred because it commenced more than two years after June 6, 2013.

The appeal

The appellant submitted that the limitation period should have been extended by six months under Section 7(1) of the Limitations Act, which states,

7 (1) The limitation period established by section 4 does not run during any time in which the person with the claim,

(a) is incapable of commencing a proceeding in respect of the claim because of his or her physical, mental or psychological condition; and

(b) is not represented by a litigation guardian in relation to the claim.


(2) A person shall be presumed to have been capable of commencing a proceeding in respect of a claim at all times unless the contrary is proved.


(3) If the running of a limitation period is postponed or suspended under this section and the period has less than six months to run when the postponement or suspension ends, the period is extended to include the day that is six months after the day on which the postponement or suspension ends.

The appellant asked the court to take a liberal approach to the provision, interpreting it to apply when the person having the claim dies before commencing proceedings. The court summarized the appellant’s argument as follows,

“He argues that a deceased person is incapable of commencing a proceeding in respect of the claim because of his or her physical, mental or psychological condition. He submits that the same policy concerns for allowing additional time for a litigation guardian to be appointed and take over the management of the affairs of the incapable person apply to an estate trustee. He points out that it takes time for an estate trustee to review the affairs of the deceased, and to obtain probate.”

However, the court did not agree. Instead, it stuck to the grammatical and ordinary sense of the words in the Act, stating they are not elastic enough to apply to a deceased person and to construe an estate trustee to be a litigation guardian.

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.