Costs From the Estate Does Not Mean Full Indemnity: Kunka Estate v. Giasson, 2026 ONSC 4290
In Kunka Estate v. Giasson, 2026 ONSC 4290[1] (“Costs Decision”), the Ontario Superior Court of Justice considered the appropriate scale and quantum of costs following the dismissal of an estate trustee’s application concerning beneficiary designations on registered accounts. The decision provides a useful reminder that, even where public policy considerations justify payment of a party’s costs from an estate, full indemnity does not automatically follow.
Background
In the underlying decision, Kunka Estate v. Giasson, 2026 ONSC 1842 (“Merits Decision”), Justice Horvat dismissed the Estate Trustee’s application concerning whether beneficiary designations made on registered accounts, including an RRSP and RIF, were subject to a resulting trust and formed part of the Estate.[2]
Justice Horvat determined that the respondent, Ms. Giasson, was entitled to her costs payable from the Estate rather than personally by the Estate Trustee. When the parties could not agree on the amount, they made written submissions.[3]
Ms. Giasson sought $43,583.49 on a full indemnity basis, or alternatively $34,556.42 based on partial and substantial indemnity costs.[4] The Estate submitted that $10,000 was appropriate.[5]
When Should Costs Be Paid from the Estate?
Justice Horvat began by reiterating the distinct approach to costs in estate litigation.
Relying on McGrath v. Joy Estate, 2022 ONCA 119 (“McGrath”), and McDougald Estate v. Gooderham, 2005 CanLII 21091 (ONCA) (“McDougald”), the Court confirmed that the first step is to consider whether public policy would justify payment of reasonable costs from the estate.[6] Those considerations include circumstances where there are reasonable grounds to question the execution or validity of a will, or where the difficulties or ambiguities giving rise to the litigation were caused by the testator.[7]
Where those considerations are not engaged, the ordinary civil costs principles apply.[8]
In the underlying Merits Decision, Justice Horvat had already determined that the relevant public policy considerations were engaged.[9] Accordingly, there was no dispute that Ms. Giasson’s costs were payable from the Estate.[10] The issue was the appropriate scale and amount of those costs.
Estate-Funded Costs Are Not Necessarily Full Indemnity Costs
Ms. Giasson argued that full indemnity costs were appropriate because she had been compelled to participate in the application as a necessary party and should not personally bear the expense of doing so.[11]
Justice Horvat disagreed. There was no evidence of the reprehensible, scandalous, or outrageous conduct ordinarily required to justify full indemnity costs.[12]
Importantly, the Court emphasized that public policy considerations articulating in McGrath must be balanced against the Court’s obligation to guard against litigation unnecessarily depleting an estate.[13]
Accordingly, the fact that Ms. Giasson’s costs were payable from the Estate did not entitle her to recover them on a full indemnity basis.
The Offer to Settle
The Court also declined to award substantial indemnity costs following Ms. Giasson’s offer to settle.
Justice Horvat found that the offer involved an insignificant compromise and provided little incentive for the Estate to accept it, particularly given the unsettled law that had prompted the application.[14] There was therefore no basis to fault or punish the Estate for declining the offer.
Conclusion
The Court ultimately awarded Ms. Giasson $26,963.13 in costs on a partial indemnity basis, together with $2,081.76 in disbursements, payable from the Estate.[15]
The Costs Decision reinforces that the source and scale of a costs award are separate considerations in estate litigation. Even where the public policy considerations identified in McGrath justify payment of costs from an estate, only reasonable costs are recoverable, and full indemnity does not automatically follow. Reasonableness and proportionality remain central to balancing fair compensation for parties required to participate in estate litigation against the need to protect the estate from unnecessary depletion.
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[1] 2026 ONSC 4290 [Kunka].
[2] Ibid at para 1.
[3] Ibid.
[4] Ibid at para 2.
[5] Ibid.
[6] Ibid at para 4.
[7] Ibid.
[8] Ibid at para 5.
[9] Ibid at para 8.
[10] Ibid.
[11] Ibid at para 9.
[12] Ibid at para 10.
[13] Ibid.
[14] Ibid at para 11.
[15] Ibid at paras 12-13.
Written by: Emily Caza
Posted on: August 27, 2026
Categories: Commentary, WEL Newsletter
In Kunka Estate v. Giasson, 2026 ONSC 4290[1] (“Costs Decision”), the Ontario Superior Court of Justice considered the appropriate scale and quantum of costs following the dismissal of an estate trustee’s application concerning beneficiary designations on registered accounts. The decision provides a useful reminder that, even where public policy considerations justify payment of a party’s costs from an estate, full indemnity does not automatically follow.
Background
In the underlying decision, Kunka Estate v. Giasson, 2026 ONSC 1842 (“Merits Decision”), Justice Horvat dismissed the Estate Trustee’s application concerning whether beneficiary designations made on registered accounts, including an RRSP and RIF, were subject to a resulting trust and formed part of the Estate.[2]
Justice Horvat determined that the respondent, Ms. Giasson, was entitled to her costs payable from the Estate rather than personally by the Estate Trustee. When the parties could not agree on the amount, they made written submissions.[3]
Ms. Giasson sought $43,583.49 on a full indemnity basis, or alternatively $34,556.42 based on partial and substantial indemnity costs.[4] The Estate submitted that $10,000 was appropriate.[5]
When Should Costs Be Paid from the Estate?
Justice Horvat began by reiterating the distinct approach to costs in estate litigation.
Relying on McGrath v. Joy Estate, 2022 ONCA 119 (“McGrath”), and McDougald Estate v. Gooderham, 2005 CanLII 21091 (ONCA) (“McDougald”), the Court confirmed that the first step is to consider whether public policy would justify payment of reasonable costs from the estate.[6] Those considerations include circumstances where there are reasonable grounds to question the execution or validity of a will, or where the difficulties or ambiguities giving rise to the litigation were caused by the testator.[7]
Where those considerations are not engaged, the ordinary civil costs principles apply.[8]
In the underlying Merits Decision, Justice Horvat had already determined that the relevant public policy considerations were engaged.[9] Accordingly, there was no dispute that Ms. Giasson’s costs were payable from the Estate.[10] The issue was the appropriate scale and amount of those costs.
Estate-Funded Costs Are Not Necessarily Full Indemnity Costs
Ms. Giasson argued that full indemnity costs were appropriate because she had been compelled to participate in the application as a necessary party and should not personally bear the expense of doing so.[11]
Justice Horvat disagreed. There was no evidence of the reprehensible, scandalous, or outrageous conduct ordinarily required to justify full indemnity costs.[12]
Importantly, the Court emphasized that public policy considerations articulating in McGrath must be balanced against the Court’s obligation to guard against litigation unnecessarily depleting an estate.[13]
Accordingly, the fact that Ms. Giasson’s costs were payable from the Estate did not entitle her to recover them on a full indemnity basis.
The Offer to Settle
The Court also declined to award substantial indemnity costs following Ms. Giasson’s offer to settle.
Justice Horvat found that the offer involved an insignificant compromise and provided little incentive for the Estate to accept it, particularly given the unsettled law that had prompted the application.[14] There was therefore no basis to fault or punish the Estate for declining the offer.
Conclusion
The Court ultimately awarded Ms. Giasson $26,963.13 in costs on a partial indemnity basis, together with $2,081.76 in disbursements, payable from the Estate.[15]
The Costs Decision reinforces that the source and scale of a costs award are separate considerations in estate litigation. Even where the public policy considerations identified in McGrath justify payment of costs from an estate, only reasonable costs are recoverable, and full indemnity does not automatically follow. Reasonableness and proportionality remain central to balancing fair compensation for parties required to participate in estate litigation against the need to protect the estate from unnecessary depletion.
—
[1] 2026 ONSC 4290 [Kunka].
[2] Ibid at para 1.
[3] Ibid.
[4] Ibid at para 2.
[5] Ibid.
[6] Ibid at para 4.
[7] Ibid.
[8] Ibid at para 5.
[9] Ibid at para 8.
[10] Ibid.
[11] Ibid at para 9.
[12] Ibid at para 10.
[13] Ibid.
[14] Ibid at para 11.
[15] Ibid at paras 12-13.
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