Orfus Estate et al. v. Samuel and Bessie Orfus Family Foundation et al., (2013) 304 O.A.C. 349 (CA)

• Judge: Laskin, Sharpe and Epstein, JJ.A.
• Court: Court of Appeal (Ontario)
• Case Date: April 10, 2013
• Jurisdiction: Ontario
• Citations: (2013), 304 O.A.C. 349 (CA);2013 ONCA 225

Orfus Estate v. Orfus Family Fdn. (2013), 304 O.A.C. 349 (CA)

MLB headnote and full text

Temp. Cite: [2013] O.A.C. TBEd. AP.022

Myer Botnick as an Executor named in the Last Will and Testament of Bessie Orfus, and Elaine Orfus and Rachel Wardinger, personally and as Executors named in the Last Will and Testament of Bessie Orfus (applicants/respondents/appellants by way of cross-appeal) v. The Samuel and Bessie Orfus Family Foundation, Carrie Heather Orfus-Gelkopf, Michael Abraham Orfus, Shayna Hyla Orfus, Sharon Gerstein , The Children's Lawyer, Mitchell Gerstein and Yisraella Shira Gelkopf ( respondents/appellant/respondent by way of cross-appeal )

(C54532; 2013 ONCA 225)

Indexed As: Orfus Estate et al. v. Samuel and Bessie Orfus Family Foundation et al.

Ontario Court of Appeal

Laskin, Sharpe and Epstein, JJ.A.

April 10, 2013.

Summary:

In May 2004, Bessie Orfus made two wills. She left her daughter Sharon shares in three Orfus companies but removed her as an executor and treated her less generously than her sister Elaine. In November 2004, Sharon began oppression proceedings in respect of the Orfus companies. She sued, among others, both her sister Elaine and her mother. On November 17, 2004, all parties consented to or did not oppose the winding up of the Orfus companies. As a result of the wind up, Sharon was to receive $9 million. On December 13, 2004, Bessie made a codicil to her two wills in which she cut Sharon out of her estate, save for a nominal $1,000 bequest. Bessie died in 2009 at the age of 98. She left an estate of nearly $20 million. Sharon gave notice of an objection to both the two wills and the codicil. She claimed that her mother lacked testamentary capacity, did not know and approve of the contents of the wills and codicil, and was unduly influenced by Elaine to sign the documents. The respondent trustees moved for summary judgment to set aside the notice of objection and for a declaration that the wills and codicil were valid.

The Ontario Superior Court, in a decision reported at [2011] O.T.C. Uned. 3043, granted summary judgment dismissing Sharon's objection. The motion judge concluded that Bessie had testamentary capacity in May and December 2004, that she knew and approved of the contents of her two wills and codicil, and that the execution of her testamentary documents was not procured by Elaine's undue influence. However, the motion judge also concluded that Sharon had reasonable grounds to challenge her mother's testamentary capacity and therefore made no order for costs. Sharon appealed the granting of summary judgment. The respondents sought leave to appeal the motion judge's refusal to award them their costs.

The Ontario Court of Appeal dismissed Sharon's appeal and refused the respondents' request for leave to appeal the costs order.

Evidence - Topic 1527

Hearsay rule - Exceptions and exclusions - General - Where admission of hearsay necessary and evidence reliable - [See Evidence - Topic 7000.4 ].

Evidence - Topic 7000.4

Opinion evidence - Expert evidence - General - Admissibility - General - The motion judge granted summary judgment dismissing Sharon Gerstein's challenge to the validity of two wills and a codicil made by her mother, Bessie - Sharon appealed - Sharon submitted that the motion judge erred in ruling inadmissible two voicemail messages left by Dr. Silberfeld, an expert capacity assessor - In the first voicemail, Dr. Silberfeld said that he had the "impression" Bessie did not have testamentary capacity - In the second voicemail, he cast further doubt on Bessie's capacity - The Ontario Court of Appeal dismissed the appeal - Dr. Silberfeld kept no file or notes of his meeting with Bessie - Seven years later when he gave evidence on the summary judgment motion, he had no memory of the meeting or what he did that led to his impression of Bessie's lack of capacity - Nonetheless, Sharon sought to tender Dr. Silberfeld's two voicemail messages as opinion evidence of her mother's lack of testamentary capacity - The motion judge ruled the voicemail messages inadmissible, either as hearsay that was both unnecessary and unreliable or as expert evidence that did not meet the test in R. v. Mohan (SCC) - He did not err in his ruling - See paragraphs 63 to 70.

Executors and Administrators - Topic 5541

Actions by and against representatives - Costs - General - [See Practice - Topic 8298 ].

Executors and Administrators - Topic 5700

Actions by and against representatives - Evidence - Claim by or against estate - Corroboration requirement - The motion judge granted summary judgment dismissing Sharon Gerstein's challenge to the validity of two wills and a codicil made by her mother, Bessie - Sharon appealed - The motion judge had relied on s. 13 of the Evidence Act to exclude Sharon's evidence about her relationship with her mother and referred to s. 13 when discussing Sharon's evidence that her mother was unsophisticated in business - Sharon submitted that the motion judge erred because on both matters her evidence was corroborated - The Ontario Court of Appeal rejected Sharon's submission - While Sharon contended that Bessie's granddaughter had corroborated her evidence with respect to her relationship with her mother, the granddaughter did not corroborate Sharon's testimony during the critical time period - Although the motion judge referred to s. 13 in connection with Sharon's evidence on her mother's business acumen he did not rely on it - Instead, he considered Sharon's testimony and rejected it - In doing so, he relied on the evidence of a doctor and two lawyers and their dealings with Bessie in connection with the 2004 wills - That evidence was essentially uncontradicted - See paragraphs 71 to 77.

Practice - Topic 5702

Judgments and orders - Summary judgments - Jurisdiction or when available or when appropriate - The motion judge granted summary judgment dismissing Sharon Gerstein's challenge to the validity of two wills and a codicil made by her mother, Bessie - Sharon appealed, submitting that the motion judge erred by granting summary judgment instead of ordering a trial of the issues - The motion judge had decided the case under the new rule 20 which came into effect on January 1, 2010 - However, the motion was decided before the release of the decision in Combined Air Mechanical Services Inc. v. Flesch (2011 ONCA) - Sharon submitted that on the "full appreciation" test set out in Combined Air, summary judgment was not appropriate - The Ontario Court of Appeal dismissed the appeal - Although the motion judge did not have the benefit of Combined Air, the court was satisfied that his appreciation of the evidence enabled him to decide by summary judgment the issues relating to Bessie's testamentary dispositions - The motion judge was not required to make contested findings of fact on conflicting evidence and credibility was not genuinely in issue - Sharon had pointed to what she alleged was significant evidence contradicting the motion judge's finding that Bessie knew the value of her assets - However, a competent testator did not have to know the precise make up of her estate - She only need know in a general way the nature and extent of her property - In this case, the lawyers showed Bessie a chart of her assets, which she acknowledged accurately represented their value - See paragraphs 44 to 62.

Practice - Topic 5719

Judgments and orders - Summary judgments - To dismiss action - [See Practice - Topic 5702 ].

Practice - Topic 7032.1

Costs - Party and party costs - Entitlement to - Estate matters - [See Practice - Topic 8298 ].

Practice - Topic 7246

Costs - Party and party costs - Offers to settle - Whether judgment equal to or more favourable than offer - [See Practice - Topic 8298 ].

Practice - Topic 8298

Costs - Appeals - Appeals from order granting or denying costs - Requirement of leave to appeal - The motion judge granted summary judgment dismissing Sharon Gerstein's challenge to the validity of two wills and a codicil made by her mother - However, the motion judge found that Sharon had reasonable grounds to challenge her mother's testamentary capacity to make the 2004 wills and codicil - The motion judge also discounted an offer to settle made by the respondents about seven months before the motion was heard - He was not persuaded that the judgment obtained by the respondents bettered their offer, but even if it did, he would have exercised his discretion to "order otherwise" under rule 49.10(1) - Therefore, the motion judge ordered no costs of the motion - Sharon appealed the granting of summary judgment - The respondent trustees sought leave to appeal the motion judge's refusal to award them their costs - The Ontario Court of Appeal denied the respondents leave to appeal the costs decision - The motion judge did not err in finding that Sharon had reasonable grounds both to launch her challenge and to pursue it - The court was also inclined to agree with the motion judge that because of the costs component of the offer, the respondents did not obtain a result more favourable than their offer to settle - However, even if that was not correct, the motion judge did not err in the exercise of his discretion by invoking the proviso in rule 49.10, "unless the court orders otherwise" - See paragraphs 89 to 100.

Wills - Topic 301

Testamentary capacity - General - [See Practice - Topic 5702 ].

Wills - Topic 534

Testamentary capacity - Evidence and proof - Onus of proof - General - [See Wills - Topic 1504 ].

Wills - Topic 541

Testamentary capacity - Evidence and proof - Doctrine of suspicious circumstances - [See Wills - Topic 1504 ].

Wills - Topic 1504

Preparation and execution - General - Requirement of knowledge of contents - The motion judge granted summary judgment dismissing Sharon Gerstein's challenge to the validity of two wills and a codicil made by her mother, Bessie - Sharon appealed - She submitted that the motion judge erred in finding that Bessie knew and approved of the contents of her codicil - Bessie's daughter Elaine had contacted a solicitor (Botnick) and asked him to prepare the codicil - She then relayed her mother's instructions to him - Botnick and his associate Mitnick did not speak to Bessie about her codicil - They did not have a copy of the 2004 wills that the codicil was intended to amend - Although they met with Bessie on December 13, 2004, so she could sign the codicil, neither Botnick nor Mitnick had any recollection of the meeting - The Ontario Court of Appeal held that the motion judge did not err in finding that Bessie knew and approved of the contents of her codicil and had testamentary capacity when she signed it - The motion judge correctly found that suspicious circumstances existed - Thus, the estate trustees had to prove on a balance of probabilities that Bessie knew and approved of the contents of her codicil and that she had testamentary capacity - The motion judge found that they met their burden - He did not err in making that finding - No evidence was led that Bessie lacked testamentary capacity in December 2004 or that her cognitive abilities had changed in any way between May and December 2004 - There was also cogent positive evidence that reasonably supported the motion judge's finding - See paragraphs 78 to 88.

Cases Noticed:

Combined Air Mechanical Services Inc. et al. v. Flesch et al. (2011), 286 O.A.C. 3; 108 O.R.(3d) 1; 2011 ONCA 764, appld. [para. 9].

Smith Estate v. Rotstein et al. (2011), 281 O.A.C. 30; 106 O.R.(3d) 161; 2011 ONCA 491, refd to. [para. 44, footnote 1].

Schwartz, Re, [1970] 2 O.R. 61 (C.A.), refd to. [para. 60].

R. v. Mohan, [1994] 2 S.C.R. 9; 166 N.R. 245; 71 O.A.C. 241, refd to. [para. 66].

R. v. Khelawon (R.), [2006] 2 S.C.R. 787; 355 N.R. 267; 220 O.A.C. 338; 2006 SCC 57, refd to. [para. 67].

Vout v. Hay - see Hay Estate, Re.

Hay Estate, Re, [1995] 2 S.C.R. 876; 183 N.R. 1; 82 O.A.C. 161, refd to. [para. 83].

McDougald Estate, Re (2005), 199 O.A.C. 203; 255 D.L.R.(4th) 435 (C.A.), refd to. [para. 89].

Statutes Noticed:

Civil Procedure Rules (Ont.) - see Rules of Civil Procedure (Ont.).

Evidence Act, R.S.O. 1990, c. E-23, sect. 13 [para. 71].

Rules of Civil Procedure (Ont.), rule 20.04(2) [para. 44].

Counsel:

Richard B. Swan and Emrys Davis, for the appellant/respondent by way of cross-appeal;

Clare Burns and Mandy L. Seidenberg, for the respondents/appellants by way of cross-appeal.

This appeal and cross-appeal were heard on June 7 and 15, 2012, before Laskin, Sharpe and Epstein, JJ.A., of the Ontario Court of Appeal. The following judgment of the Court of Appeal was delivered by Laskin, J.A., and was released on April 10, 2013.