Ontario: an overview of Succession Law Reform Act limits

In Weigand v. Mohammed, Justice George considered whether to extend the limitation period in s. 61(1) of the Succession Law Reform Act.  His decision sets out the statutory framework:

[2]               If permitted, the application would be brought under Part V of the SLRA.

[3]               Section 57 defines a dependent as any of the spouse, parent, or sibling of a deceased, and to whom the deceased was providing support or was under a legal obligation to provide support immediately before his or her death.

[4]               Section 58 provides that:

Where a deceased, whether testate or intestate, has not made adequate provision for the proper support of his dependants or any of them, the court, on application, may order that such provision as it considers adequate be made out of the estate of the deceased for the proper support of the dependants or any of them.

[5]               The limitation period is set out in s. 61(1):

Subject to (2), no application for an order under section 58 may be made after six months from the grant of letters probate of the will or of letters of administration.

[6]               The limitation period does not begin to run at any time during which the person with the claim is a minor.

[7]               My jurisdiction to grant an extension derives from (2):

The court, if it considers it proper, may allow an application to be made at any time as to any portion of the estate remaining undistributed at the date of the application.

The issue was whether in the circumstance of the case it would be proper to grant leave pursuant to s. 61(2).  These is Justice George’s analysis:

[26]           In B(JDD) the court provides some guidance on how to apply and interpret s. 61(2) of the Act.  I am to do so judicially and in a broad and liberal manner. I must consider the delay, the reasons for delay, and whether there would be prejudice to the estate’s ability to defend the proposed claim.

[27]           The question is does this situation bear review of whether the testator made adequate provision in his will for dependents?  Not whether he has in fact done so, but is there a sufficient basis for a review.  This requires a consideration of what is equitable, and whether or not the respondent acted “honestly, reasonably, and fairly”.

[28]           This is the applicant’s position in a nut shell.  The respondent caused the delay through her misrepresentation, and has not acted honestly.  They suggest there would be no prejudice to the estate as the respondent is the only beneficiary.  No innocent third party beneficiaries would be put at risk.

[29]           The respondent relies upon the decisions in each of Re Assaf Estate, [2007] OJ No 4579; Blatchford v. Gardiner,[1999] OJ No 3478; and Su v. Lem, [2012] OJ No 1448, all Superior Court decisions. She claims that granting an extension would bring an injustice upon her, and in any event the assets have already been distributed.

[30]           She agrees the test is whether the situation bears review of the adequacy of provisions. She, however, stresses that this is a fact-dependent exercise, and that in these circumstances, a review is not warranted.

[31]           The easy thing to do would be to simply say there is a conflict in the evidence, which I cannot resolve at this stage, and therefore the broadest and most liberal thing to do would be to grant the extension and allow the application to go forward.  This would, however, suggest an extension should be automatically granted.  It is not that simple.

[32]           While it is true the reason for delay is a factor to consider, a request for an extension is not grounded solely in “good cause” being shown for the delay.  The discretion to extend (or refuse) is a question of what is equitable between the parties, in all the circumstances. The respondent argues that the payment to the mother is the equitable outcome.  The children have been provided for, and beyond that a testator can distribute their assets as they see fit.

[33]           What are the circumstances?  First, there was a delay.  The limitation period has passed.  There is some dispute as to how long the delay was but that is of little consequence. Second, there is a conflict in the evidence as to the reason for delay, which I cannot resolve. In this respect there are essentially cross-allegations of bad faith.  It is said the respondent lied when she promised to sell the home and distribute proceeds to the children.  It has been suggested the applicant’s attempted to mislead the court by not mentioning the funds received by their mother.  Third, and further to that last point, I accept the respondent paid to the applicant’s mother, specifically for child support and in order to comply with the divorce judgment, approximately $30,702.27. It is worth nothing that the mother released the respondent from any further claims upon receipt of the funds.  Fourth, I accept the respondent’s accounting, and accept that the estate has for the most part been distributed.  Fifth, the deceased had an obligation to pay child support at the time of death.

[34]           It would be wrong to allow the respondent to rely on the fact she has distributed the estate as a basis to not grant an extension.  If the applicant’s version of events is true, and the respondent did indeed promise to sell the home and distribute the funds to them, than it would be unconscionable to allow her to defeat a claim by virtue of a passed limitation period.  If this is true, the respondent would be estopped from relying on the limitation period, as it would be open to the court to find that the applicants relied on that representation to their detriment.

[35]           As I only have untested affidavits, I am unable to resolve the conflicts in the evidence. This weighs in favour of an extension.

[…]

[42]           The part of s. 61(2) that does give me pause is the reference to “any portion of the estate remaining undistributed at the date of the application”.  This raises an interesting question.  In the normal course, and some of the case law speaks to this, if the estate has been fully distributed an extension should not be granted.  This makes sense.  It would make the discretionary extension of the limitation period a pointless exercise.  There is nothing left to distribute.  However, in our instance, a misrepresentation by the executor is being alleged, who is also the sole beneficiary, who also happens to be in current possession of the estate’s main asset, the very asset which was the subject of the misrepresentation.  It is inconceivable that the inclusion of this language was intended to shield administrators who engage in such behaviour.  I am not saying this is what happened, but a trial judge could come to this conclusion on the evidence before me.

[…]

[45]           The applicant’s say they were deceived by the respondent.  This is supported by Udo Weigand.  Even though the respondent gives a different version, I am unable to reject that explanation.  In circumstances like these, to refuse leave and not grant an extension, I would have to conclude that the prejudicial effect of an extension upon the respondent would outweigh the need to engage in a review and determine entitlement to support under s. 58.  I can’t reach that conclusion.