2003 ABQB 290, 2003 ABQB 290

Re Sowa (Estate of), 2003 ABQB 290 Date: 2003 03 28 Action No. 108231 COURT FILE NUMBER 108231 COURT Court of Queen’s Bench of Alberta (Surrogate Matter) JUDICIAL DISTRICT Edmonton ESTATE NAME JOHN SOWA PROCEDURE Application by the Personal Representative to Pass Accounts, Discharge Personal Representative, Approve Final Distribution of Estate, Advice and Direction with Regard to Remaining Issues in the Estate PARTIES APPLICANT Elizabeth Bangay The Trust Company of Bank of Montreal RESPONDENTS Ted Sowa Michael Sowa Lillian Clack (Sowa) Jerry Sowa Dianne Sowa John Sowa Bill Sowa _______________________________________________________ MEMORANDUM OF DECISION of the HONOURABLE MADAM JUSTICE J.B.

VEIT _______________________________________________________ APPEARANCES: Doris Bonara

Reynolds, Mirth, Richards & Farmer LLP for Elizabeth Bangay Michael Sowa on his own behalf

Summary [ 1 ] The Trust Company of the Bank of Montreal presents its accounting of the estate of John Sowa for approval by the court, and asks the court for discharge. None of the individuals interested in this estate objects to either the passing of accounts or the discharge of the Trust Company of the Bank of Montreal. The accounts are passed, and the Trust Company of the Bank of Montreal is discharged. [ 2 ] Despite its best efforts, the Trust Company’s accounts are incomplete; it has been unable to provide a complete accounting and has identified the reasons for its inability to do so.

Depending on the circumstances, incomplete accounts can be passed where there is no prospect of being able to complete the accounts within a reasonable time, or at a reasonable cost, or at all. [ 3 ] Elizabeth Bangay asks the court for a distribution to her of the assets in the estate of her late father. All of the other beneficiaries of the estate have filed renunciations of their interest or releases based on the distribution made to them by the former executor.

The only beneficiary who objects to a final distribution to Elizabeth Bangay is her brother, Michael Sowa, the former executor of his father’s estate; he would like to see the estate wound up, but he claims reimbursement for payments made and expenses covered on behalf of the estate. The assets remaining in the estate will be distributed to Elizabeth Bangay. [ 4 ] Michael Sowa’s claim for re-imbursement of monies allegedly paid on behalf of the estate was essentially dealt with at the last hearing.

The materials presented by him at this hearing do not constitute evidence, as they were not properly put before the court; in any event, those materials are not persuasive. Mr. Sowa has never established a claim against the estate. His claim for re-payments is denied. [ 5 ] Michael Sowa has neither performed the functions required of an executor, nor has he complied with court orders relative to the administration of his father’s estate.

An executor does not satisfy his obligation to the estate if he treats estate property as if it were his own; an executor may, when dealing with his personal property, be a spendthrift, but his obligation to the estate is to be prudent when he is dealing with estate property. Michael Sowa’s application for remuneration for his work as executor is denied. [ 6 ] Ms. Bangay is entitled to costs since the last hearing on a solicitor-client basis. Cases and authority cited [ 7 ] By the court: Estate of John Sowa 2002 ABQB 1137 1. Background

[ 8 ] The general issue of solicitor-client costs has been addressed in an earlier decision, see citation above. [ 9 ] By order of this court issued on January 10, 2002, Michael Sowa, the previous Executor of the Estate of John Sowa, was ordered to provide an accounting for all rents received by him in relation to the residence that was determined to be estate property; the accounting was to be provided within 60 days of January 10, 2002. [ 10 ] Mr.

Sowa neither appealed the order nor provided the accounting as required. [ 11 ] By order of this court issued on January 10, 2002, Michael Sowa was directed to pay to the Trust Company of the Bank of Montreal the sum of $601.66 within 90 days of January 10, 2002. [ 12 ] Mr. Sowa neither appealed the re-payment order nor paid the money as required. [ 13 ] By order of this court issued on January 10, 2002, Michael Sowa was ordered to pay Elizabeth Bangay’s costs from November 23, 2000 to January 10, 2002, on a solicitor and client basis. [ 14 ] Mr.

Sowa neither appealed the costs order nor paid the money as required. [ 15 ] Virtually all of the statements of fact made by Mr. Sowa at the hearing were unsupported by evidence. For example, although Mr. Sowa states that he had evidence that the residence was worth $65,000 when he transferred it to himself for $50,000, and although he claims that $65,000 was a true reflection of the value of the home at the time of the transfer rather than the $88,000 for which the house was sold, Mr. Sowa has presented no evidence to support his position. [ 16 ] After many previous applications, Ms.

Bangay applies for the passing of accounts of the administrator of the estate of John Sowa, the discharge of the personal representative of the Estate of John Sowa, and for the final distribution of the estate to herself. 2. Passing of accounts and Discharge of the Trust Company [ 17 ] The accounts presented by the Trust Company of the Bank of Montreal are passed, and the trust company is discharged. [ 18 ] Mr. Mendenhall, on behalf of the Trust Company, has identified those areas in which the accounts are incomplete. I accept the evidence from the Trust Company, and from Ms.

Bangay, that no improvement in the quality of these accounts could be expected even if additional time were given for the preparation of accounts: the unfortunate fact is that Michael Sowa did not keep the kind of accounts which are standard for personal representatives. [ 19 ] I note as well that all of the beneficiaries of the estate, including Michael Sowa, accept the accounts as presented, and agree that the trustee should be discharged. [ 20 ] In those circumstances, even though the accounts cannot be characterized as complete, the accounts are passed and the trust company discharged. 3.

Distribution of the estate to Elizabeth Bangay

[ 21 ] The remaining assets in this estate should be distributed to Ms. Bangay. [ 22 ] There are no practical alternatives to the proposed distribution. Certain allegations of impropriety had been made by certain of the beneficiaries against Michael Sowa. However, none of those individuals proposes that the allegations should be tried; one assumes that the small size of the estate was a factor in the decision not to pursue the allegations. [ 23 ] Each of the beneficiaries other than Ms.

Bangay executed a document which was essentially either renunciation to their entitlement to the estate in the format proposed by their father in his will or a release of the then executor based on the distribution which had been made to them. Therefore, there is no realistic alternative to the distribution of the remaining assets of the estate to Ms. Bangay. [ 24 ] Michael Sowa objects to the distribution of the remaining assets to Ms. Bangay. Mr.

Sowa’s main concern is that the assets of the asset should be used first to re-imburse him for payments he has made on behalf of the estate, and then should be divided equally amongst John Sowa’s children. There are three problems with Mr. Sowa’s proposal. First, the general issue of Mr. Sowa’s claims against the estate were disposed of at the last hearing. That issue is essentially res judicata . [ 25 ] Second, even ignoring the fact that Mr. Sowa’s claim was previously dealt with, at this hearing he has not established that he has a claim against the estate for monies spent on its behalf.

I accept the evidence of Mr. Mendenhall that Mr. Sowa’s claims for re- imbursement are suspect. It is important to note that, although he will by now be familiar with court proceedings, Mr. Sowa did not put any of the documents on which he relies before the court as evidence, which is done by way of affidavit. Strictly speaking, therefore, there is no evidence to support Mr. Sowa’s various claims. [ 26 ] Even if the documents presented by Mr. Sowa were considered to be evidence, they do not establish a legitimate claim against the estate.

In addition to the claims of his siblings, including Dianne Sowa, that the invoices presented by Mr. Sowa, although allegedly from third parties, were in fact made out in Mr. Sowa’s hand, I have inspected the documents myself and have concluded that Mr. Sowa has not met the onus upon him to establish on a balance of probabilities that these documents represent legitimate claims against the estate. Also, I agree with the comments made by Dianne Sowa to the effect that it would not have been prudent for Mr. Sowa to have paid $50 per hour for house cleaning. Moreover, Mr.

Sowa has not established that, even if he had made payments to former tenants as he alleges, it was reasonable for him to do so. Mr. Sowa had no basis, for example, for paying one tenant $2,500 for property allegedly owned by her that was allegedly removed from a garage over which Mr. Sowa had control. Mr. Sowa had an obligation to his fellow beneficiaries that he did not discharge; no matter how casual or generous Mr. Sowa may be with his own property, he did not have the right to treat the estate property in this casual, off-hand way. [ 27 ] The third type of problem with Mr. Sowa’s objection to Ms.

Bangay’s proposal, relates to the releases or renunciations signed by each of the beneficiaries other than Ms. Bangay. None of the other siblings has the status, without undertaking proceedings to set the releases aside, to make a claim against the remaining estate property. None of the siblings proposes to undertake the kind of proceedings necessary to set the releases aside; such decisions are understandable in light of the small size of this estate. The result is, however, that the siblings other than Ms. Bangay are not entitled to make a claim against the estate, and that Mr.

Sowa’s claim against the estate is rejected. [ 28 ] Therefore, Ms. Bangay’s proposal for distribution of the remaining assets to herself is approved. 4. Application by Michael Sowa for remuneration for work done while he was executor of the estate [ 29 ] Mr. Sowa is not entitled to remuneration for the work done by him as executor in the administration of his father’s estate. [ 30 ] The evidence on this and on previous applications establishes that Michael Sowa grossly failed to meet his obligations as an executor.

This dereliction of duty began with the transfer of the house to himself and continued in his dealings with estate property.

[ 31 ] Moreover, Michael Sowa has failed to comply with the orders made by the court on the last occasion when these proceedings were before the court. Mr. Sowa is in apparent contempt of those orders; a person who is in breach of court orders is not in a position to make any requests of the court whose orders it has failed to obey. [ 32 ] In the circumstances, it would be grossly unfair to reward Michael Sowa in any way for his work in relation to the estate. His claim for a fee is denied. 5. Costs [ 33 ] Ms. Bangay is entitled to solicitor-client costs. [ 34 ] Mr.

Sowa objects to the payment from the estate funds of solicitor-client costs: he suggests that Mr. Mendenhall could have presented the report of the trustee and that a solicitor would not be required. I cannot give effect to Mr. Sowa’s objections. While Mr. Mendenhall was invited to provide information to the court and to the parties during the course of the hearing of this application, because this court does not hear from individuals other than those who are appearing on their own behalf, Mr.

Mendenhall would have required a lawyer to present the portion of the application dealing with his accounts and with his request for a discharge. No savings would have been effected there. Also, Ms. Bangay asks for the distribution of the remaining portion of the estate to herself; therefore, an appearance from her lawyer would have been required for that purpose in any event. [ 35 ] Although solicitor-client costs is not the inevitable scale of costs in estate matters, it is the appropriate scale in the circumstances here. HEARD on the 25 th day of March, 2003.

DATED at Edmonton, Alberta this 2 8th day of March, 2003. __________________________ J.C.Q.B.A.