Estates and Trusts - Trustees - Practice and Procedure
Plaintiff and defendant disagreed about ownership of property in which plaintiff lived, but for which defendant, his brother, held title. Plaintiff was found to be entitled to declaration of beneficial interest in property and it was ordered transferred to him and defendant was ordered to compensate plaintiff for equity he had removed from property. Defendant was found to have breached his fiduciary duties as trustee. Plaintiff’s claim that defendant acted in bad faith and his request for punitive damages were dismissed. Defendant was successful on obtaining compensation for reasonable expenses incurred as trustee and for damages arising from plaintiff's breaches of their agreement. Defendant was ordered to pay plaintiff costs in of $25,988.00, inclusive of fees, disbursements and HST. Both parties were found to have acted unreasonably and in breach of their agreement, but neither party conducted himself unreasonably in context of litigation. There was no need to use costs to sanction either party for inappropriate conduct. There was no basis on which to award costs on elevated scale. There was divided success but plaintiff was substantially more successful than defendant. Central issues were defendant's demand for indemnification of his potential liability for capital gains taxes, for compensation for his “troubles” as trustee of property, and for order of sale of property so that he could be paid out of the proceeds of sale and plaintiff was successful on all three major issues. Apportioning costs based on proportionate value of damages awarded to each party would be inappropriate. Quantum of plaintiff’s costs had to be discounted for fact that he was unsuccessful in his claim for punitive damages,. Defendant's inappropriate actions were largely provoked by plaintiff's actions and defendant's behaviour did not constitute marked departure from common decency. Defendant was successful on issue of bad faith. Issues were very important to plaintiff because property was his home and his primary asset, and property value was substantial. Litigation would likely have been avoided had defendant not insisted on indemnification of his potential tax liability for capital gains which was unreasonable position for him to take.
Syrnyk v. Syrnyk (2019), 2019 CarswellOnt 3882, 2019 ONSC 1270, Petersen J. (Ont. S.C.J.); additional reasons (2019), 2019 CarswellOnt 246, 2019 ONSC 225, Petersen J. (Ont. S.C.J.).
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