Case Comment: Marcy v. Marcy
Marcy v. Marcy, 2023 ONSC 5499 (CanLII)
Introduction
On September 2023, an endorsement by the Honourable Justice Myers (“Justice Myers”) in Marcy v. Marcy 2023 ONSC 5499[1] reinforced the Court’s jurisdiction to control and prevent the abuse of the Court’s process.
Background
Gordon Marcy (“Applicant”) and Brian Marcy (“Respondent”) are bothers, and the residuary beneficiaries of their late mother’s estate. Their mother passed away in 2015 with a will, where she appointed the Respondent as her Estate Trustee.
In 2022, the Honourable Justice Dietrich removed the Respondent and appointed Adam Hummel (“Estate Trustee”), an independent third party, as Estate Trustee.
The Estate Trustee sold the deceased’s house with closing set for October 4, 2023[2].
The Respondent registered a caution on title to the house to stop the closing and removed the caution after Counsel for the Estate Trustee and the Applicant objected[3].
The Estate Trustee brought this motion urgently seeking an order vacating the caution to ensure that any “no dealings indicator” was also removed from title, as well as for an order preventing the Respondent from interfering with the closing, and costs on a full indemnity basis of $10,718.05.
The Respondent’s Counsel argued that section 9 of the Estate Administration Act applied to this case since title to the deceased’s house vested in the two brothers three years after their mother’s death. Therefore, the Estate Trustee did not have the right to sell the Respondent’s vested interest in the house or to close the sale.
“Vesting of real estate not disposed of within 3 years
9 (1) Real property not disposed of, conveyed to, divided or distributed among the persons beneficially entitled thereto under section 17 by the personal representative within three years after the death of the deceased is, subject to the Land Titles Act in the case of land registered under that Act and subject to subsections 53 (3) and (5) of the Registry Act, and subject as hereinafter provided, at the expiration of that period, whether probate or letters of administration have or have not been taken, thenceforth vested in the persons beneficially entitled thereto under the will or upon the intestacy or their assigns without any conveyance by the personal representative, unless such personal representative, if any, has signed and registered, in the proper land registry office, a caution in the form prescribed by regulation under subsection (7), and, if a caution is so registered, the real property mentioned therein does not so vest for three years from the time of the registration of the caution or of the last caution if more than one was registered. R.S.O. 1990, c. E.22, s. 9 (1); 2017, c. 20, Sched. 11, s. 8 (1).”
Justice Myres acknowledged the Court of Appeal’s decision in Di Michele v. Di Michele, 2014 ONCA 261 (CanLII)[4] where the Court confirmed that section 9 of the Estate Administration Act does not limit the powers given to an estate trustee under a will[5], and the paramountcy of the testator’s intention[6] read under section 10 of the Estate Administration Act.
“Ordinary rights of executors, etc., preserved
10 Nothing in section 9 derogates from any right possessed by an executor or administrator with the will annexed under a will or under the Trustee Act or from any right possessed by a trustee under a will. R.S.O. 1990, c. E.22, s. 10.”
In their mother’s will, the Estate Trustee had the “power to sell property at such times and in such manner as the estate trustees sees fit”.
Conclusion
The Court concluded that the Estate Trustee and the Applicant were at real risk of being unable to recover any losses incurred by any further interference with the upcoming closing by the Respondent[7].
In addition, the Court stated that advancing a claim under a statute that does not apply was a frivolous attempt, plus, registering a caution without a legal basis designed to stop a lawful transaction from closing was vexatious if not tortious[8].
As a result, the Court granted an injunction prohibiting the Respondent, or anyone acting on his instructions, or on his behalf, and anyone with knowledge of this order from taking any action that may interfere with the closing of the sale of the house by the Estate Trustee[9], and further ordered the Respondent to pay costs of the Estate Trustee on a full indemnity basis fixed at $10,718.05.
Notably, the Court’s main outcome was to control and stop the Respondent’s abuse of the Court’s process. In this case, the Court reminded litigants of the inherent jurisdiction to award costs on a full indemnity scale against those whose misconduct warrants same.
—
[1] Marcy v. Marcy, 2023 ONSC 5499 (CanLII)
[2] Ibid para 4
[3] Ibid para 5
[4] Di Michele v. Di Michele, 2014 ONCA 261 (CanLII)
[5] Marcy v. Marcy, 2023 ONSC 5499 (CanLII) para 12
[6] Ibid para 14
[7] Ibid para 28
[8] Ibid para 33
[9] Ibid para 29
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Written by: Fabiana Araujo M. S. Kennedy
Posted on: January 9, 2024
Categories: Commentary
Marcy v. Marcy, 2023 ONSC 5499 (CanLII)
Introduction
On September 2023, an endorsement by the Honourable Justice Myers (“Justice Myers”) in Marcy v. Marcy 2023 ONSC 5499[1] reinforced the Court’s jurisdiction to control and prevent the abuse of the Court’s process.
Background
Gordon Marcy (“Applicant”) and Brian Marcy (“Respondent”) are bothers, and the residuary beneficiaries of their late mother’s estate. Their mother passed away in 2015 with a will, where she appointed the Respondent as her Estate Trustee.
In 2022, the Honourable Justice Dietrich removed the Respondent and appointed Adam Hummel (“Estate Trustee”), an independent third party, as Estate Trustee.
The Estate Trustee sold the deceased’s house with closing set for October 4, 2023[2].
The Respondent registered a caution on title to the house to stop the closing and removed the caution after Counsel for the Estate Trustee and the Applicant objected[3].
The Estate Trustee brought this motion urgently seeking an order vacating the caution to ensure that any “no dealings indicator” was also removed from title, as well as for an order preventing the Respondent from interfering with the closing, and costs on a full indemnity basis of $10,718.05.
The Respondent’s Counsel argued that section 9 of the Estate Administration Act applied to this case since title to the deceased’s house vested in the two brothers three years after their mother’s death. Therefore, the Estate Trustee did not have the right to sell the Respondent’s vested interest in the house or to close the sale.
“Vesting of real estate not disposed of within 3 years
9 (1) Real property not disposed of, conveyed to, divided or distributed among the persons beneficially entitled thereto under section 17 by the personal representative within three years after the death of the deceased is, subject to the Land Titles Act in the case of land registered under that Act and subject to subsections 53 (3) and (5) of the Registry Act, and subject as hereinafter provided, at the expiration of that period, whether probate or letters of administration have or have not been taken, thenceforth vested in the persons beneficially entitled thereto under the will or upon the intestacy or their assigns without any conveyance by the personal representative, unless such personal representative, if any, has signed and registered, in the proper land registry office, a caution in the form prescribed by regulation under subsection (7), and, if a caution is so registered, the real property mentioned therein does not so vest for three years from the time of the registration of the caution or of the last caution if more than one was registered. R.S.O. 1990, c. E.22, s. 9 (1); 2017, c. 20, Sched. 11, s. 8 (1).”
Justice Myres acknowledged the Court of Appeal’s decision in Di Michele v. Di Michele, 2014 ONCA 261 (CanLII)[4] where the Court confirmed that section 9 of the Estate Administration Act does not limit the powers given to an estate trustee under a will[5], and the paramountcy of the testator’s intention[6] read under section 10 of the Estate Administration Act.
“Ordinary rights of executors, etc., preserved
10 Nothing in section 9 derogates from any right possessed by an executor or administrator with the will annexed under a will or under the Trustee Act or from any right possessed by a trustee under a will. R.S.O. 1990, c. E.22, s. 10.”
In their mother’s will, the Estate Trustee had the “power to sell property at such times and in such manner as the estate trustees sees fit”.
Conclusion
The Court concluded that the Estate Trustee and the Applicant were at real risk of being unable to recover any losses incurred by any further interference with the upcoming closing by the Respondent[7].
In addition, the Court stated that advancing a claim under a statute that does not apply was a frivolous attempt, plus, registering a caution without a legal basis designed to stop a lawful transaction from closing was vexatious if not tortious[8].
As a result, the Court granted an injunction prohibiting the Respondent, or anyone acting on his instructions, or on his behalf, and anyone with knowledge of this order from taking any action that may interfere with the closing of the sale of the house by the Estate Trustee[9], and further ordered the Respondent to pay costs of the Estate Trustee on a full indemnity basis fixed at $10,718.05.
Notably, the Court’s main outcome was to control and stop the Respondent’s abuse of the Court’s process. In this case, the Court reminded litigants of the inherent jurisdiction to award costs on a full indemnity scale against those whose misconduct warrants same.
—
[1] Marcy v. Marcy, 2023 ONSC 5499 (CanLII)
[2] Ibid para 4
[3] Ibid para 5
[4] Di Michele v. Di Michele, 2014 ONCA 261 (CanLII)
[5] Marcy v. Marcy, 2023 ONSC 5499 (CanLII) para 12
[6] Ibid para 14
[7] Ibid para 28
[8] Ibid para 33
[9] Ibid para 29
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