Petrowski v. Petrowski Estate et al., (2009) 476 A.R. 171 (QB)

• Judge: Moen, J.
• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: September 02, 2009
• Citations: (2009), 476 A.R. 171 (QB);2009 ABQB 753

Petrowski v. Petrowski Estate (2009), 476 A.R. 171 (QB)

MLB headnote and full text

Temp. Cite: [2010] A.R. TBEd. JA.016

Peter Petrowski (plaintiff) v. Joan Doreen Petrowski, Executrix of the Estate of Nick Petrowski, Deceased and Joan Doreen Petrowski (defendants)

(0303 16218; 2009 ABQB 753)

Indexed As: Petrowski v. Petrowski Estate et al.

Alberta Court of Queen's Bench

Judicial District of Edmonton

Moen, J.

December 21, 2009.

Summary:

The testator died in 2001 at the age of 92. In his will, which he made in August 2000, he left all of his property to his daughter (the defendant), whom he also made the executor of his will. Three months before he passed away, the testator executed transfers of all his farm and mineral titles into joint names with the defendant. The plaintiff (the testator's son) brought an action, challenging the will and transfers.

The Alberta Court of Queen's Bench, in a decision reported at 466 A.R. 59, determined the issues. The plaintiff was entirely unsuccessful. The plaintiff applied for costs. The defendant cross-applied, seeking double costs on the basis of an offer made early in the litigation.

The Alberta Court of Queen's Bench determined the issues and awarded costs of $244,083.09 to the defendant.

Executors and Administrators - Topic 5548

Actions by and against representatives - Costs - Where payable out of estate - [See Family Law - Topic 6760 , Gifts - Topic 3006 and Practice - Topic 7326 ].

Family Law - Topic 6760

Dependents' relief legislation - Practice - Costs - The testator died in 2001 at the age of 92 - In his will, which he made in August 2000, he left all of his property to his daughter (the defendant), whom he also made the executor of his will - Three months before he passed away, the testator executed transfers of all his farm and mineral titles into joint names with the defendant - The plaintiff (the testator's son) brought an action, challenging the will and transfers - The plaintiff applied for relief under the Family Relief Act on the basis that he was disabled and required testamentary relief - The plaintiff was unsuccessful at trial - The plaintiff sought to have his costs paid out of the estate for the Family Relief Act application - The Alberta Court of Queen's Bench denied the request, holding that "[a]n application under dependants' relief legislation presumes that a will is valid and that the testator had capacity. It is not caused by the testator in that respect and litigation is not required in order to clear up ambiguities appearing in the will. The general principle in all litigation, subject to the discretion of the court, is that costs follow the result. This principle has been deviated from in cases where the validity of the will, the capacity of the testator or the meaning of the will is at stake. Society has an interest in probating only those wills which are valid and clear and which have been written by someone who is not under the undue influence of another or suffering from testamentary incapacity. It is also not just to ask a potential beneficiary to bear the costs of a lawsuit where it is the testator's actions which are the root cause of the suit. In those situations, deviating from the general principle is appropriate. An application under a statute for a variation of an otherwise valid will shares no such public policy reasons. Accordingly, these are not cases in which it is appropriate to deviate from the general principle that the costs follow the event." - See paragraphs 61 to 75.

Gifts - Topic 3006

Practice - General - Costs - The testator died in 2001 at the age of 92 - In his will, which he made in August 2000, he left all of his property to his daughter (the defendant), whom he also made the executor of his will - Three months before he passed away, the testator executed transfers of all his farm and mineral titles into joint names with the defendant - The plaintiff (the testator's son) brought an action, challenging the will and transfers on the basis of, inter alia, lack of testamentary capacity and undue influence - The plaintiff was entirely unsuccessful at trial - The plaintiff sought to have his costs paid out of the estate for the challenge to the inter vivos transfers of the estate - The Alberta Court of Queen's Bench denied the request, holding that "[l]itigation surrounding this type of transfer does not involve interpretation of a will and therefore cannot be said to be the fault of the deceased, nor is this a claim under dependants' relief legislation. However, on the facts of this case it did involve a challenge to [the testator]'s mental capacity. This challenge was utterly unsuccessful. The question is whether this type of challenge fits within the recognized estate litigation exception to the general rule that costs follow the event where a reasonable challenge is brought against a will due to questions surrounding testamentary capacity. I do not believe that it can. Nor do I believe that this is an area where the courts should recognize a new exception to the general rule that costs follow the event." - In any event, the testator had the requisite mental capacity at the time the transfers were executed - The evidence surrounding this issue was known to the plaintiff long before the trial began - Challenging the testator's capacity and alleging undue influence was not reasonable - Therefore even if an exception applied, the plaintiff would still be ineligible to have his costs paid from the estate - See paragraphs 76 to 81.

Practice - Topic 7020

Costs - Party and party costs - Entitlement to - Successful party - General principles - The testator died in 2001 at the age of 92 - In his will, which he made in August 2000, he left all of his property to his daughter (the defendant), whom he also made the executor of his will - Three months before he passed away, the testator executed transfers of all his farm and mineral titles into joint names with the defendant - The plaintiff (the testator's son) brought an action, challenging the will and transfers on the basis of, inter alia, lack of testamentary capacity and undue influence - The plaintiff was entirely unsuccessful at trial - The Alberta Court of Queen's Bench awarded the defendant costs on a party and party basis - While the plaintiff was unsuccessful, there was no evidence of unreasonable or vexatious conduct which would warrant an elevation from party and party costs - Given the multiplicity of the proceedings, the complexity of the issues, the unsubstantiated allegations of undue influence and the economic value at stake in this action, it was appropriate to award the defendant costs payable by the plaintiff on a party and party basis under Column 5 of Schedule C of the Alberta Rules of Court - See paragraphs 7 to 19.

Practice - Topic 7032.1

Costs - Party and party costs - Entitlement to - Estate matters - [See Practice - Topic 7020 ].

Practice - Topic 7040

Costs - Party and party costs - Entitlement to - Unsuccessful party - [See Family Law - Topic 6760 and Practice - Topic 7326 ].

Practice - Topic 7115

Costs - Party and party costs - Special orders - Increase in scale of costs - Difficulty and complexity of proceedings - [See Practice - Topic 7020 ].

Practice - Topic 7241

Costs - Party and party costs - Offers to settle - General (incl. what constitutes and validity) - The testator died in 2001 at the age of 92 - In his will, which he made in August 2000, he left all of his property to his daughter (the defendant), whom he also made the executor of his will - Three months before he passed away, the testator executed transfers of all his farm and mineral titles into joint names with the defendant - The plaintiff (the testator's son) brought an action, challenging the will and transfers on the basis of, inter alia, lack of testamentary capacity and undue influence - The plaintiff was entirely unsuccessful at trial - The defendant had made a formal offer to discontinue the action on a without costs basis on June 11, 2004, following examinations for discovery - The plaintiff argued that it was not a genuine offer - The Alberta Court of Queen's Bench rejected the plaintiff's argument - At this point, the plaintiff was or should have been aware that his position based on the evidence was weak - The offer was a reasonable reflection of the position of the parties and contained elements of compromise given that both sides had incurred costs - It was realistic, and it was made in good faith - The waiver by the defendants of the right to claim for those costs was an offer to forego a significant amount of money - The plaintiff's case was completely unsuccessful and he failed to recover a judgment more favourable than the judgment offered to him by the defendant on June 11, 2004 - There was no special reason why rule 174(1.1) (double costs) should not apply - Therefore, the defendant was awarded double costs (excluding disbursements) for all steps taken after June 11, 2004 - See paragraphs 20 to 26.

Practice - Topic 7243

Costs - Party and party costs - Offers to settle - Effect of failure to accept - [See Practice - Topic 7241 ].

Practice - Topic 7326

Costs - Costs in probate proceedings - Unsuccessful opposition to proof of will - The testator died in 2001 at the age of 92 - In his will, which he made in August 2000, he left all of his property to his daughter (the defendant), whom he also made the executor of his will - Three months before he passed away, the testator executed transfers of all his farm and mineral titles into joint names with the defendant - The plaintiff (the testator's son) brought an action, challenging the will and transfers on the basis of, inter alia, lack of testamentary capacity and undue influence - The plaintiff was entirely unsuccessful at trial - The plaintiff sought to have his costs paid out of the estate for the testamentary capacity and undue influence issues - The Alberta Court of Queen's Bench held that: the testator had not caused the litigation; the challenge to the testator's capacity and the allegation of undue influence were unreasonable; and the unsubstantiated allegation of undue influence and the fact that the plaintiff had rejected a reasonable offer and had made an unreasonable offer weighed against the plaintiff - Accordingly, this was not a case where the unsuccessful plaintiff should get costs from the estate - See paragraphs 27 to 60.

Practice - Topic 7328

Costs - Costs in probate proceedings - Solicitor and client costs - [See Practice - Topic 7020 ].

Practice - Topic 7454

Costs - Solicitor and client costs - Entitlement to - Improper, irresponsible or unconscionable conduct - [See Practice - Topic 7020 ].

Practice - Topic 7455

Costs - Solicitor and client costs - Entitlement to - Estates - [See Practice - Topic 7020 ].

Cases Noticed:

McCullough Estate, Re (1998), 212 A.R. 74; 168 W.A.C. 74; 1998 ABCA 38, refd to. [para. 9].

McCullough Estate v. Ayer - see McCullough Estate, Re.

Hemmerling Estate v. Hemmerling et al. (2000), 279 A.R. 373; 2000 ABQB 902, refd to. [para. 13].

Acquest/Alberta Mining Inc. v. Barry Developments Inc. (1999), 254 A.R. 357; 1999 ABQB 1018, refd to. [para. 17].

Allen v. University Hospitals Board et al. (2006), 384 A.R. 23; 59 Alta. L.R.(4th) 1; 2006 ABCA 101, refd to. [para. 21].

Meyer v. Partec Lavalin Inc. et al. (2002), 303 A.R. 385; 273 W.A.C. 385; 2002 ABCA 114 (C.A.), refd to. [para. 25].

Edmonton (City) v. Lovat Tunnel Equipment Inc. et al. (2002), 328 A.R. 314; 2002 ABQB 1033, refd to. [para. 25].

Babchuk v. Kutz et al. (2007), 411 A.R. 181; 2007 ABQB 88, affd. (2009), 457 A.R. 44; 457 W.A.C. 44; 47 E.T.R.(3d) 51; 2009 ABCA 144, appld. [para. 25].

Boje Estate, Re, [2005] A.W.L.D. 1243; 363 A.R. 288; 343 W.A.C. 288; 2005 ABCA 73, refd to. [para. 62].

Kowalski Estate, Re, [2005] A.R. Uned. 423; 140 A.C.W.S.(3d) 217; 2005 ABQB 378, refd to. [para. 62].

G.E.S., Re, [2003] A.R. Uned. 449; 2003 ABQB 674, refd to. [para. 62].

Woycenko Estate, Re (2002), 315 A.R. 291; 47 E.T.R.(2d) 301; 2002 ABQB 640, refd to. [para. 62].

C.D. v. Spinelli Estate (1998), 229 A.R. 137; 84 A.C.W.S.(3d) 610; 1998 ABQB 966, refd to. [para. 62].

V.T.D. v. Spinelli Estate - see C.D. v. Spinelli Estate.

Public Trustee (Alta.) v. Raniseth Estate (1990), 80 Alta. L.R.(2d) 272 (Q.B.), refd to. [para. 62].

Pauliuk v. Pauliuk (1986), 73 A.R. 314; 48 Alta. L.R.(2d) 25 (Q.B.), refd to. [para. 62].

Berube, Re, [1973] 3 W.W.R. 180; 12 R.F.L. 97 (Alta. C.A.), refd to. [para. 63].

Lumley v. Lumley Estate (2002), 314 A.R. 315; 2002 ABQB 326, refd to. [para. 63].

Gow v. Gow Estate (1998), 238 A.R. 39; 28 E.T.R.(2d) 197; 74 Alta. L.R.(3d) 279 (Q.B.), refd to. [para. 63].

Bosanac Estate, Re, [2005] W.D.F.L. 3997; 388 A.R. 175; 2005 ABQB 590, refd to. [para. 63].

Vinokurova v. Seneker - see Bosanac Estate, Re.

Skworoda v. Skworoda Estate, [2008] A.R. Uned. 311; 88 Alta. L.R.(4th) 84; 2008 ABQB 240, refd to. [para. 65].

Public Trustee (Alta.) v. Jacobson Estate (1987), 58 Alta. L.R.(2d) 355 (Q.B.), refd to. [para. 65].

Gaudet v. Gaudet, 1984 CarswellAlta 684 (Q.B.), refd to. [para. 66].

Gavinchuk v. Mickalyk et al., [2003] A.R. Uned. 628; 4 E.T.R.(3d) 215; 2003 ABQB 849, refd to. [para. 67].

Davey Estate, Re (2007), 234 B.C.A.C. 285; 387 W.A.C. 285; 2007 BCCA 20, folld. [para. 69].

Davey v. Gruyaert - see Davey Estate, Re.

Vielbig v. Waterland Estate et al., [1995] 3 W.W.R. 515; 54 B.C.A.C. 219; 88 W.A.C. 219; 1 B.C.L.R.(3d) 76; 121 D.L.R.(4th) 485 (C.A.), refd to. [para. 69].

Tomlyn v. Herchenson Estate et al., [2008] B.C.T.C. Uned. 157; 38 E.T.R.(3d) 289; 2008 BCSC 331, refd to. [para. 73].

St. Onge Estate v. Breau (2009), 345 N.B.R.(2d) 101; 889 A.P.R. 101; 48 E.T.R.(3d) 162; 2009 NBCA 36, folld. [para. 76].

Authors and Works Noticed:

Orkin, Mark M., The Law of Costs (2nd Ed.) (2009 Looseleaf Supp.), vol. 1, § 219.3 [para. 8].

Counsel:

Robert S. Wachowich and Patrick McAllister (Weir Bowen LLP), for the plaintiff;

David Hawreluk, Alisha Hurley and Lillian H.Y. Yeung (Bennett Jones LLP), for the defendants.

This application and cross-application were heard on September 2, 2009, by Moen, J., of the Alberta Court of Queen's Bench, Judicial District of Edmonton, who delivered the following memorandum of decision on costs on December 21, 2009.