



COURT OF APPEAL FOR ONTARIO

CITATION: Trezzi v. Trezzi, 2019 ONCA 978

DATE: 20191213

DOCKET: C65835, C65855 & C65979

Sharpe, Hourigan and Jamal JJ.A.

In the Estate of Peter Trezzi, deceased

BETWEEN

DOCKET: C65835

Alfrida Gina Trezzi, personally,
    and in her capacity as estate trustee of the
Estate of Peter Trezzi

Applicant (Respondent)

and

Albert Trezzi
, in his personal capacity,
    and in his capacity as estate trustee of the
Estate of Peter Trezzi, Emily Trezzi, Bianca Trezzi, Across Canada
Construction Ltd., Trezzi Construction Ltd., and
Alberto Trezzi Sr.

Respondents (
Appellant
)



AND BETWEEN

DOCKET: C65855

Alfrida Gina Trezzi,
    personally, and in her capacity as estate trustee
of the Estate of Peter Trezzi

Applicant (Respondent)

and

Albert Trezzi
, in his personal capacity and
    in his capacity as estate trustee of the Estate of Peter Trezzi,
Emily Trezzi,
    Bianca Trezzi
, Across Canada Construction
Ltd., Trezzi Construction Ltd., and Alberto Trezzi Sr.

Respondents
(
Appellants
/
Respondent
)

AND BETWEEN

DOCKET: C65979

Alfrida Gina Trezzi,
    personally, and in her capacity as estate trustee of the
Estate of Peter Trezzi

Applicant (Appellant)

and

Albert Trezzi
,
    in his personal capacity, and in his capacity as estate trustee of the
Estate of Peter Trezzi, Emily Trezzi, Bianca Trezzi, Across Canada
Construction Ltd., Trezzi Construction Ltd., and
Alberto Trezzi Sr.

Respondents (
Respondent
)

AND BETWEEN

Albert
    Trezzi, (aka Alberto) in his personal capacity and in his capacity as Estate
    Trustee

Applicant in the Cross-Application



and

Alfrida Gina Trezzi, personally, and in
    her capacity as estate trustee of the
Estate of Peter Trezzi

Respondent in the Cross-Application

Craig Ross and Krystyne Rusek, for Emily Trezzi and Bianca
    Trezzi

Danielle R. Joel and Ewa Krajewska, for Alfrida Gina
    Trezzi

Symon Zucker and Laney Paddock, for Albert Trezzi

Heard: October 2, 2019

On appeal from the orders of Justice Herman J. Wilton-Siegel
    of the Ontario Superior Court of Justice, dated August 2, 2018 (C65835 and
    C65855), with reasons reported at 2018 ONSC 4710, 42 E.T.R. (4th) 322, and
    September 4, 2018 (C65979) with reasons reported at 2018 ONSC 5180.

Jamal J.A.:

I.

Introduction

[1]

These three related appeals arise in connection with the will of the
    late Peter Trezzi, who died on January 8, 2016.

[2]

Peter and Gina Trezzi were married for 25 years. They had two daughters together,
    Bianca and Emily Trezzi. Peter also had a son from a previous marriage, Albert
    Trezzi, who was 13 years old when Peter and Gina married.

[3]

Peter operated a successful construction business through two Ontario corporations,
    Across Canada Construction Ltd. (ACC) and Trezzi Construction Ltd. (Trezzi
    Construction).

[4]

There is no dispute that Peter was the sole shareholder of Trezzi
    Construction. But there is a dispute as to whether Gina owned half of the
    shares of ACC, and also as to other issues under Peters will. On one side of
    the dispute is Albert; on the other side are Gina, Bianca, and Emily.

[5]

For present purposes, the relevant aspects of Peters will are as
    follows:

·

Gina
    and Albert were named as joint executors and trustees of Peters will.

·

Albert
    was gifted: (i) all of Peters interest in ACC; (ii) real property located at
    220 Regina Road, Woodbridge (which was owned by Trezzi Construction); and (iii)
    all the equipment and chattels owned by Trezzi Construction.

·

Gina,
    Albert, Emily, and Bianca were each gifted equal shares of: (i) all other real
    property owned by Peter; (ii) all other assets owned by Trezzi Construction; and
    (iii) the residue of Peters estate.

[6]

In two comprehensive endorsements, the application judge concluded that:

1.

Peter could bequeath assets held by Trezzi Construction to Albert. Gina,
    Bianca, and Emily had challenged these bequests on the basis that Peter did not
    own those assets, as they were owned by Trezzi Construction, and therefore Peter
    could not give what he did not own.

2.

Gina had not established that she owned 50% of the shares of ACC. The application
    judge left for a future determination whether Peter owned any shares of ACC.

3.

Gina was entitled to an extension of time to file a surviving spouses
    election under s. 6(1) of the
Family Law Act
, R.S.O. 1990, c. F.3

(
FLA
),
    in order to choose whether to receive her bequests under the will or under her
    statutory entitlement as a surviving spouse pursuant to s. 5(2) of the
FLA
.
    Because of the ongoing litigation as to Ginas entitlements under the will, the
    application judge ruled that it would be fair to grant Gina this extension to allow
    her to make an informed decision regarding her election.

[7]

Bianca and Emily, with Ginas support, now appeal the first conclusion;
    Gina appeals the second conclusion; and Albert appeals the third conclusion.

[8]

For the reasons that follow, I would dismiss all three appeals.

ANALYSIS

(1)

Did the application judge err in concluding that Peter Trezzi could effectively
    bequeath corporate assets held by his construction company, Trezzi Construction
    Ltd.?

[9]

The first issue is whether the application judge erred in concluding
    that Peter could effectively bequeath assets held by his construction company,
    Trezzi Construction, of which he was the sole shareholder.

[10]

The
    clauses of Peters will that are impugned by Gina, Bianca, and Emily, are as
    follows:

·

Clause 3(d), which gave Albert [a]ll equipment and chattels owned
    by Trezzi Construction Ltd..

·

Clause 3(e), which gave Albert [t]he real property municipally
    known as 220 Regina Road, Woodbridge, which was owned by Trezzi Construction.

·

Clause 3(m), which gave [a]ll other assets owned by Trezzi Construction
    Ltd. in equal shares to Gina, Albert, Emily, and Bianca.

[11]

Gina,
    Bianca, and Emily assert that these gifts are invalid because a shareholder of
    a corporation owns only the shares of that corporation (which the shareholder can
    bequeath), but does not own the corporations assets (which the shareholder cannot
    bequeath). They claim that upholding these gifts would involve disregarding the
    separate corporate personality of Trezzi Construction, and that because these
    gifts are invalid, they fall into the residue of the estate.

[12]

I
    disagree. I conclude that Peter did effectively bequeath the assets of Trezzi
    Construction.

[13]

I
    agree with the application judge that the courts task in interpreting a will is
    to determine the testators actual or subjective intention as to how he intended
    to dispose of his property. This involves construing the will in light of all
    the surrounding circumstances to determine the testators true intention and
    the court placing itself in the position of the testator at the time that the
    will was made: see
Re Burke
, [1960] O.R. 26 (C.A.), at p. 30;
Re
    Kaptyn Estate
, 2010 ONSC 4293, 102 O.R. (3d) 1, at paras. 30-38; and
Halsburys
    Laws of Canada
, 
Wills and Estates
,
    (Toronto: LexisNexis Canada, 2016 reissue), at HWE 63.

[14]

In
    this case, the application judge concluded that Peters actual or subjective
    intention was to give all of the assets owned by Trezzi Construction to Gina,
    Albert, Emily, and Bianca, such that Trezzi Construction would be left without assets
    of any kind, and that this in turn indicated that Peter intended Trezzi
    Construction to be wound-up. As the application judge found: the testator has
    made provision for all of the assets of Trezzi [Construction], not merely the
    assets to go to Albert. In my view, this indicates that the testator
    effectively turned his mind to, and directed, a winding-up of Trezzi and an
in
    specie
distribution of the assets as set out in clauses 3(d), 3(e), and
    3(m) of the will. The
in specie
or in kind distribution of assets of
    Trezzi Construction to Peters beneficiaries would, of course, be subject to
    Trezzi Constructions liabilities to any creditors.

[15]

These
    findings of the application judge interpreting Peters will to determine his
    subjective intention in light of all the surrounding circumstances are findings
    of fact and of mixed fact and law that are entitled to appellate deference. Just
    as the interpretation of a contract in light of its surrounding circumstances
    is now subject to review (absent an extricable error of law) only for palpable
    and overriding error, in my view, the same is true for the interpretation of a
    will in light of its surrounding circumstances: see
Hicklin Estate v.
    Hicklin
, 2019 ABCA 136, 46 E.T.R. (4th) 1, at paras. 10, 94-95;
Zindler
    v. The Salvation Army
, 2015 MBCA 33, 6 E.T.R. (4th) 34, at para. 10; and
Sattva
    Capital Corp. v. Creston Moly Corp
.
, 2014 SCC 53, [2014] 2 S.C.R.
    633, at para. 50.

[16]

In
    my view, there is no palpable and overriding error in the findings of the
    application judge to justify this courts intervention.

[17]

Nor
    are those findings infected by any extricable error of law. In my view, the application
    judge correctly held that the executors of Peters will have two independent sources
    of authority to implement his intention to wind-up Trezzi Construction: (a) their
    general powers under corporate law; and (b) their powers under clause 3(a) of
    the will.

[18]

With
    respect to the executors general powers under corporate law, s. 193(1) of the
Business
    Corporations Act,
R.S.O. 1990, c. B.16, provides that [t]he shareholders
    of a corporation may, by special resolution, require the corporation to be
    wound up voluntarily. Section 67(2)(a) of the
Business Corporations Act
provides that an executor or estate trustee of the estate of a deceased
    security holder may exercise all the rights that the deceased security holder had
    before their death. Thus, while he was alive Peter had the corporate authority,
    as the sole shareholder of Trezzi Construction, to wind-up the corporation.
    Upon his death, that authority devolved to his executors or estate trustees. As
    a result, under Ontario corporate law Peters executors have the power to implement
    his intention to wind-up Trezzi Construction.

[19]

With
    respect to the executors powers under the will, the application judge found that
    clause 3(a) of Peters will also provides the executors with the necessary
    powers to implement Peters wish to have Trezzi Construction wound up. Clause
    3(a) states in relevant part:

3.       I GIVE, DEVISE AND BEQUEATH all my property of every
    nature and kind wheresoever situate, including any property over which I may
    have a general power of appointment, to my said Trustees upon the following
    trusts, namely:

(a) To use their discretion in the realization of my estate,
    with the power to my Trustees to sell, call in and convert into money any part
    of my estate not consisting of money at such time or times, in such manner and
    upon such terms, and either for cash or credit or for part cash and part credit
    as my said Trustees may in their uncontrolled discretion decide upon,

[20]

While
    this clause does not refer expressly to a power to wind-up Trezzi Construction,
    but rather refers only to converting the estates assets into money, I conclude
    that the gifts do not fail on this basis. As the application judge correctly noted,
    the executors power to wind-up the corporation already exists under corporate
    law. I also agree with him that the executors implicitly have this authority in
    their discretionary power to convert the estates assets into money. Because Peters
    shares in Trezzi Construction were part of his estate not consisting of money,
    clause 3(a) of his will authorizes his executors to take any steps that may be
    needed to sell, call in, and convert those shares into money. This would include
    winding-up the corporation. As such, I agree with the application judge that
    Peters will conferred on his executors the authority to wind-up Trezzi
    Construction.

[21]

Because
    of these two independent sources of authority for Peters executors to wind-up
    Trezzi Construction, I would reject Ginas contentions that the gifts of the
    assets of Trezzi Construction fail because Peter did not directly own those
    assets and that upholding these gifts would disregard Trezzi Constructions
    separate corporate personality. While it is true that Peter, as the sole
    shareholder of Trezzi Construction, did not directly own the corporations
    assets, that does not complete the analysis. In substance, Peters shares in
    Trezzi Construction became part of the estate, and Peter effectively directed his
    executors to wind-up the company and to distribute its assets in accordance
    with his will, even though he did not own those assets directly. As already
    noted, the key question thus boils down to whether this was indeed Peters subjective
    intention in his will: see
Re Kaptyn Estate
, at paras. 126-144. For
    the reasons stated above, I conclude that the application judge did not err in
    concluding that this was Peters intention.

[22]

It
    follows that I also do not agree with the conclusions reached in the Saskatchewan
    and Alberta cases relied on by Gina, Bianca, and Emily, to the extent that those
    cases can be read as holding that a sole shareholder of a corporation can never
    effectively gift corporate assets because they are owned by the corporation:
    see
Re Thornton Estate
(1990), 85 Sask. R. 34 (Surr. Ct.), at paras.
    4-5;
Earl v. Wilhelm
, 2000 SKCA 1, 183 D.L.R. (4th) 45, at para. 12,
    leave to appeal refused, [2000] S.C.C.A. No. 124;
Re Meier (Estate of)
,
    2004 ABQB 352, 366 A.R. 299, at paras. 16-22; and
Oryshchuk Estate
,
    2009 ABQB 688, 485 A.R. 379, at para. 35. As noted, the principle of corporate
    separateness does not complete the analysis of whether a testator who is the
    sole shareholder of a corporation can effectively gift corporate assets. The court
    must go on to consider whether that authority exists under corporate law or under
    the terms of the relevant will. I agree with the application judge that because
    both sources of authority are present in this case, Peter could effectively
    bequeath assets held by Trezzi Construction.

[23]

I
    acknowledge that it would have been preferable had Peters will been more explicit
    in referring to the trustees authority to deal with his corporations property.
    In this regard, the Law Society of Ontarios
The Annotated Will 2019
(January 16, 2019), at p. 1-79, provides the following helpful model language that
    would further clarify an executors power to deal with the assets of a
    corporation in which a testator is the sole shareholder:

If at any time my Trustees hold in my estate any investment in
    or in connection with any company or corporation, my Trustees may join in or
    take any action in connection with this investment or exercise any rights,
    powers and privileges that at any time may exist or arise in connection with
    this investment to the same extent as I could if I were living and the sole
    owner of this investment.

[24]

For
    these reasons, I conclude that the application judge did not err in concluding
    that Peter could effectively gift corporate assets held by his construction company.

(2)

Did the application judge err in finding that Gina Trezzi did not own 50%
    of the shares of Across Canada Construction Ltd.?

[25]

The
    second issue is whether the application judge erred in finding that Gina did not
    establish that she owned 50% of the shares of ACC.

[26]

As
    the application judge correctly noted, this issue raises essentially a factual
    matter. It turns on the application judges evaluation of the evidence that
    Gina had adduced to establish her claimed ownership of 50% of ACCs shares. The
    application judge correctly noted that, in order to establish this, Gina has
    the onus of proof on a balance of probabilities.

[27]

The
    evidence that Gina adduced to support her claim included the following:

·

First,
    organizational documentation in the minute book of ACC prepared in 1993 showed two
    shareholders, namely, Peter and Gina, each owning 50 shares. Two share
    certificates, apparently created at the same time, also reflected Peter and
    Ginas ownership of shares. A reporting letter dated September 14, 1993 from
    Peters lawyer, Enzo Zeppieri (Zeppieri), stated that Peter and Gina were
    shareholders of ACC.

·

Second,
    in 2011 Peter engaged a solicitor, Cosimo Crupi (Crupi), to implement a reorganization
    of the business carried on under the name Across Canada Construction &
    Paving. In 2012, Crupis law clerk advised Gina that she was a 50% shareholder
    of ACC. However, the reorganization was ultimately aborted.

·

Third,
    Gina relied on a letter dated July 12, 2017 from Zeppieri to her legal counsel
    advising that Gina and Peter were each 50% shareholders of ACC.

·

Fourth,
    Gina claimed that she and Peter ran the business Across Canada Construction
    as equal business partners for 27 years.

[28]

Albert
    countered with other evidence that suggested that Gina never owned any shares
    in ACC. The application judge found as follows:

·

First,
    none of the corporate documentation prepared in 1993 or 2011 purportedly supporting
    the claim that Peter and Gina were equal shareholders of ACC was ever executed.
    Nor was Gina ever given a share certificate evidencing her claimed shareholding.

·

Second,
    the evidence of Crupi and his law clerk falls short of establishing that
    shares were allotted and issued to Gina. Crupis evidence was to the effect
    that he and his law clerk would have relied on documents and information
    provided to them by others. Crupi acknowledged that he did not focus on the
    question of whether Gina was a shareholder until this litigation.

·

Third,
    Zeppieris reporting letter of September 14, 1993 did no more than report on
    the preparation of organizational documentation that appears to have never been
    executed. Zeppieris letter of July 12, 2017 merely repeated what appeared earlier
    in the minute book. In any event, these letters were contradicted by the declarations
    of Gina made on October 16, 2015 (while Peter was alive) and Zeppieri made on July
    19, 2016 (shortly after Peters death), which confirmed that Peter was the only
    shareholder, officer, and director of ACC. These declarations were delivered in
    connection with union certification proceedings involving ACC before the
    Ontario Labour Relations Board.

·

Fourth,
    Ginas claimed involvement in the business of ACC did not on its own constitute
    evidence of her 50% shareholding interest. The application judge noted that
    arguments based on unjust enrichment were beyond the scope of the present
    proceeding.

[29]

Based
    on his evaluation of all the evidence, the application judge concluded that
    Gina had not met her onus of showing that she owned 50% of ACCs shares. He summarized
    his conclusions as follows:

In summary, there is unsigned documentation in the ACC minute
    book that, if executed, and if consideration had been paid for the shares,
    would have constituted each of Gina and Peter the holders of fifty common
    shares of ACC. At its highest, such documentation may reflect Peters
    consideration at the time of incorporation of ACC of an equal shareholding
    arrangement. However, there is no evidence that Peter ever implemented such a
    shareholding arrangement, that is, there is no evidence that the shares were
    ever issued. There is also some evidence that suggests that they were not issued
    and that Peter ultimately decided to carry on as the sole shareholder.
    Ultimately, Ginas case rests on an alleged presumption in her favour which, in
    my view, is not available in the present circumstances. Based on the foregoing,
    I conclude that Gina has failed to establish, on a balance of probabilities,
    that she is the owner of any common shares of ACC.

[30]

These
    are conclusions of fact and mixed fact and law that are owed substantial deference
    by this court and may be set aside only by showing palpable and overriding
    error. In my view, based on the evidence that was before the application judge,
    Gina has shown no such error.

[31]

In
    addition, Gina asserts that the application judge erred in law in three respects.

[32]

First,
    she asserts that the application judge decided an issue that was never pleaded.
    She says that the issue to be determined was whether she and Peter each owned
    50 common shares of ACC, not whether ACC had ever issued any shares. She says that
    neither she nor Albert ever pleaded that ACC had not issued any shares.

[33]

I
    disagree with this submission. Gina placed squarely before the application
    judge the issue of whether she owned 50% of the shares of ACC, and he
    determined that issue against her. It was entirely open to the application
    judge to make ancillary factual findings in the course of addressing this
    question.

[34]

Second,
    Gina claims that the application judge has left the corporate status of ACC in
    limbo and that he improperly bifurcated this proceeding by declining to address
    whether any shares were issued to Peter.

[35]

I
    also disagree with this submission. The application judge emphasized that the
    only issue before him was the evidence and law regarding Ginas alleged
    ownership of shares in ACC. He immediately added that [i]t does not
    necessarily follow from [this determination] that Peter owned the shares of
    ACC. In my view, it was open to the application judge to determine the nature
    and scope of the issues that he was prepared to address at this stage, in view
    of the discrete issues that were scheduled to be heard before him, the relief
    that Gina had sought, and the evidence adduced.

[36]

I
    appreciate that this means that further proceedings will likely be required before
    the issues arising under Peters will are resolved. However, in my view, this does
    not provide a basis for this court to intervene with the application judges findings.
    Moreover, the parties should be able to resolve the remaining issues without
    resorting again to litigation.

[37]

Finally,
    Gina claims that the application judge erred in his treatment of the statutory
    presumption created by s. 266(3) of the
Business Corporations Act
.
    Gina argued that an unexecuted Shareholders Register listing her as a
    shareholder in ACC was presumptive proof of her share ownership pursuant to s.
    266(3), which provides as follows:

An entry in a securities register of, or a security certificate
    issued by, a corporation is, in the absence of evidence to the contrary, proof
    that the person in whose name the security is registered or whose name appears
    on the certificate is the owner of the securities described in the register or
    in the certificate, as the case may be.

[38]

The
    application judge rejected this argument. He found that the unexecuted Shareholders
    Register did not qualify as a securities register for purposes of s. 266(3)
    because it did not meet the requirements for a securities register under s. 141(1)
    of the
Business Corporations Act
.
Section 141(1) requires a
    corporation to prepare and maintain at its registered office, or at any place
    in Ontario designated by the directors, a securities register in which it
    records the securities issued by it in registered form. The application judge
    found that Gina had not established that ACC had issued any securities in
    registered form under s. 141(1) because he concluded that the unexecuted
    share certificates in the minute book in the names of Gina and Peter are not
    securities issued in registered form. Rather, the application judge found that
    proving that securities had been issued in registered form would require properly
    issued executed share certificates of ACC and evidence of the actual issuance of
    shares.

[39]

In
    my view, given the application judges factual finding that no shares had been issued
    by ACC in registered form, he did not err in concluding that the Shareholders
    Register did not qualify as a securities register under s. 141(1), and consequently
    that the statutory presumption under s. 266(3) did not apply. While the
    statutory presumption might be relied upon to evince share ownership in the
    absence of an executed share certificate, in my view it must first be established
    that the document presented as a securities register is truly such. In this
    case, there was insufficient evidence that this document was a record of shares
    that had been issued in registered form. As a result, I conclude that the application
    judges findings are owed substantial deference by this court.

[40]

For
    these reasons, in my view the application judge did not err in finding that
    Gina did not own 50% of ACCs shares.

(3)

Did the application judge err in exercising his discretion to provide Gina
    Trezzi an extension of time to file a surviving spouses election under s. 6(1)
    of the
Family Law Act
?

[41]

The
    third and final issue is whether the application judge erred in exercising his
    discretion to provide Gina with an extension of time to file a surviving
    spouses election under s. 6(1) of the
FLA
until after the estates
    assets are valued, in order to allow Gina to make an informed decision
    regarding that election. Albert appeals the decision of the application judge to
    grant the extension.

[42]

The
    relevant statutory provisions are as follows:

·

Section
    5(2) of the
FLA
provides that when a spouse dies, if the net family
    property of the deceased spouse exceeds the net family property of the
    surviving spouse, the surviving spouse is entitled to one-half the difference
    between them.

·

However,
    s. 6(1) of the
FLA
provides that when a spouse dies leaving a will,
    the surviving spouse shall elect to take under the will or to receive the entitlement
    under s. 5.

·

Section
    6(10) of the
FLA
requires the surviving spouses election to be in a
    prescribed form and filed with the Estate Registrar for Ontario within six
    months after their spouses death.

[43]

Peter
    died on January 8, 2016, and therefore the six-month filing deadline prescribed
    by s. 6(10) of the
FLA
expired on July 8, 2016. Gina applied for an
    extension on December 22, 2017, about 18 months after the deadline had expired
    for her to file a surviving spouses election.

[44]

Section
    2(8) of the
FLA
provides that the court may extend the time for filing
    a surviving spouses election if it is satisfied that: (a) there are apparent
    grounds for relief; (b) relief is unavailable because of delay that has been
    incurred in good faith; and (c) no person will suffer substantial prejudice by
    reason of the delay.

[45]

The
    application judge readily granted Gina an extension because he found that she
    met the statutory test. He concluded that: (a) Gina has a right to elect for an
    equalization payment under the
FLA
, but it is not possible to determine
    the amount (if any) of that payment until the court determines the entitlement
    and valuation issues under the will. It would therefore be unfair to require
    Gina to make an election before these critical ownership and valuation issues
    are resolved; (b) any delay had been incurred by Gina in good faith; and (c) nobody
    would be prejudiced by the delay.

[46]

In
    his costs ruling, the application judge added that [t]here was no legal basis
    for Alberts opposition to this motion:
Trezzi v. Trezzi
, 2019 ONSC
    3464, 47 E.T.R. (4th) 288, at para. 28.

[47]

The
    application judges discretionary decision to grant Gina an extension of time
    under s. 2(8) of the
FLA
in order to elect whether to file a surviving
    spouses election is entitled to substantial deference:
Katz v. Nimelman
,
    2009 ONCA 445, 73 R.F.L. (6th) 288, at para. 3. The party seeking to challenge
    such a decision must show an error in the application of the principles
    relevant to the exercise of the discretion:
Hutchinson v. Hutchinson
(2001), 11 R.F.L. (5th) 297 (Ont. C.A.), at para. 6.

[48]

In
    seeking to meet this burden, Albert argues that the application judge made numerous
    legal and factual errors in granting Gina the extension.

[49]

First,
    Albert contends that the application judge erred in finding apparent grounds
    for relief. He claims that s. 2(8) of the
FLA
requires Gina to
    establish that she is entitled to receive an equalization payment of net family
    property.

[50]

I
    do not agree. The relief in issue for purposes of s. 2(8) of the
FLA
is not the right to the equalization payment itself, but rather the right to
    elect for an equalization of net family property: see
Scherer v. Scherer
(2002), 59 O.R. (3d) 393 (C.A.), at para. 16. To require a surviving spouse to
    prove a right to an equalization payment in order to obtain an extension under
    s. 2(8) to make an election would defeat the remedial purpose of the
FLA
:
    it would deprive a surviving spouse of the right to choose the more favourable
    financial outcome as between a will and under the
FLA
simply because
    they lack information necessary to make an informed choice between the two.

[51]

Here,
    as a surviving spouse, Gina clearly has a right to elect for an equalization
    payment. She has therefore met her burden of showing apparent grounds for the
    relief sought for which she seeks an extension of time.

[52]

Nor
    do I accept Alberts argument that the application judge improperly determined
    that an extension should be granted in all circumstances where a will is
    contested. The application judges ruling was not so sweeping. Rather, it was
    rooted firmly in the circumstances of this case. He simply ruled that Gina had
    an apparent right to elect for an equalization payment, and that in the context
    of this ongoing litigation it was not possible for her to make an informed
    choice regarding her surviving spouses election because of the current state
    of information regarding the estates assets and her entitlements under the
    will.

[53]

I
    therefore see no error in principle in the application judges decision on the
    first prong for the discretion to extend under s. 2(8) of the
FLA
.

[54]

Second,
    Albert contends that the delay in issue was not incurred by Gina in good faith.
    The application judge rejected this argument, as would I.

[55]

The
    good faith requirement in s. 2(8) of the
FLA
merely requires the
    applicant for an extension to show that they acted honestly and with no
    ulterior motive:
Hart v. Hart
(1990), 27 R.F.L. (3d) 419 (Ont.
    U.F.C.J.), at p. 432, cited in
Scherer
, at para. 24.

[56]

Here,
    the application judge found that Gina met this threshold. He found that there
    was no evidence that Gina was aware, or reasonably ought to have been aware, of
    her rights before May 2017, when she consulted with a family law lawyer. This
    was not a reversal of the onus to prove good faith. The application judge was simply
    satisfied on the record before him that Gina did not know about her rights before
    May 2017.

[57]

The
    application judge also accepted Ginas evidence that she initially refrained
    from applying for an extension while her counsel obtained information that
    would allow her to make an informed choice, but she then did so when it became
    clear that issues involving the estate would not be resolved consensually. The
    delay incurred was between May 2017 (when Gina became aware of her rights) and
    December 22, 2017 (when Gina applied for the extension). The application judge
    found that this delay was not unreasonable, especially because Ginas counsel had
    communicated to Alberts counsel her intention to apply for an extension in the
    future, if appropriate. He also found that Gina was not required to apply immediately
    to the court for an extension of time simply to protect her right to file an
    election, because she might never need to exercise that right.

[58]

These
    factual findings were available to the application judge given the evidence. I
    see no basis for this court to intervene.

[59]

Third,
    Albert contends that the application judge erred in finding that no person will
    suffer substantial prejudice by reason of the delay. The application judge
    rejected this argument because: (a) there had been limited administration of
    the estate to date, largely because of the acrimony between Albert and Gina,
    for which he found both parties responsible; (b) the estate would not be in a
    position to make a distribution until the ownership and valuation issues are
    resolved; and (c) of the four equal residual beneficiaries, only Albert opposed
    the extension request. Further, the application judge found that while Albert claimed
    that he was prejudiced by the delay in obtaining a judicial declaration regarding
    the issues involving the estate, any such prejudice was not because of the
    delay in Ginas application for an extension of time to make an election under
    the
FLA
.

[60]

It
    was again entirely open to the application judge to reach these conclusions on
    the evidence before him. Once again, I see no basis for this court to
    intervene.

[61]

I
    would therefore dismiss Alberts appeal from the application judges decision to
    grant Gina an extension to file an election under s. 6(1) of the
FLA
.

COSTS

[62]

In
    my view, two considerations are relevant to costs for these appeals.

[63]

First,
    success was divided: Albert succeeded on the first and second issues, while
    Gina succeeded on the third issue.

[64]

Second,
    I have concluded that this is not an appropriate case for costs to be paid from
    the estate. The modern approach to costs in estate litigation provides that
    the court is to carefully scrutinize the litigation and, unless it finds that
    one or more of the relevant public policy considerations apply, it shall follow
    the costs rules that apply in civil litigation:
Sawdon Estate v. Water
    Tower Bible and Tract Society of Canada,
2014 ONCA 101, 119 O.R. (3d) 81,
    at paras. 84-86. The relevant public policy considerations are: (1) the need to
    give effect to valid wills that reflect the intention of competent testators;
    and (2) the need to ensure that estates are properly administered. These
    considerations apply to costs awards made on appeal: see
Sawdon
at
    paras. 101-7.

[65]

On
    appeal, the parties were litigating in their personal capacities as
    beneficiaries, not in their capacities as trustees concerned with the proper
    administration of the estate. And whatever might have been said about any public
    policy considerations at first instance, I conclude that they were largely absent
    on appeal. In my view, allowing costs for these appeals to be paid from the
    estate would give rise to a danger that the estate would be unreasonably
    depleted because of unwarranted or needlessly protracted litigation:
Sawdon
    Estate
, at para. 84.

[66]

Having
    regard to these considerations, I have concluded that all parties should bear their
    own costs of the appeals.

DISPOSITION

[67]

I
    would dismiss the appeals without costs.

Released
:
RJS   DEC 13 2019

M. Jamal J.A.

I agree. Robert J.
    Sharpe J.A.

I agree. C.W. Hourigan
    J.A.


