Halstead v Selock, 2021 ABQB 1026

Court of Queen’s Bench of Alberta Citation: Halstead v Selock, 2021 ABQB 1026 Date: 20211229 Docket: ES01 041917 Registry: Calgary In the Matter of the Estate of Sydney Wales Metcalfe Between: Neal Halstead As Limited Administrator of a Portion of the Estate Applicant - and - Lance Kenneth Selock and Wood’s Homes Society Respondents _______________________________________________________ Reasons for Decision of the Honourable Mr. Justice John T. Henderson _______________________________________________________ I.

OVERVIEW [ 1 ] The Applicant, Neal Halstead is the Limited Administrator (the “Limited Administrator”) of one asset of the Estate of Sydney Wales Metcalfe, deceased (the “Metcalfe Estate”) pursuant to an Order granted by Justice C. S. Anderson on February 20, 2020 and a subsequent Limited Grant of Administration dated April 24, 2020 in accordance with the direction of Justice G. D. Marriott. The Court of Appeal has recently dismissed the appeal from the decision of Justice Anderson: Wood’s Homes Society v Selock , 2021 ABCA 431 .

[ 2 ] The Limited Grant of Administration is in relation to an apartment building known as the Lucerne Apartment, located at 638 – 15 th Avenue SW in the City of Calgary (the “Lands”).

The legal description of the Lands is: Lots thirty-nine (39) and forty (40) in block one hundred and five (105), according to a plan of the City of Calgary of record in the Land Titles Office for the South Alberta Land Titles Office for the South Alberta Land Registration District as Plan A Calgary. [ 3 ] The remainder of the Metcalfe Estate continues to be administrated by the Executor, Lance Kenneth Selock. [ 4 ] On this application, the Limited Administrator seeks advice and direction from the Court pursuant to the Estate Administration Act , SA 2014, c E-12.5 , s 49(1).

More specifically, the Limited Administrator seeks advice and direction with respect to whether he may transfer legal title to the Lands to Wood’s Homes Society, the specific beneficiary of the Lands pursuant to the last will and testament of Sydney Wales Metcalfe. [ 5 ] The application is opposed by the Respondent, Lance Selock, the executor of the estate of Barbara Selock who, until her death, had been the executrix of the estate of Sydney Wales Metcalfe. [ 6 ] Following the death of Barbara Selock, Lance Selock assumed control over the Lands and, on August 22, 2019, title to the Lands was transmitted to “Lance Kenneth Selock ...

Executor for Sydney Wales Metcalfe”. Legal title has since been transmitted to the Limited Administrator. [ 7 ] The primary ground on which the application is opposed is that the bequest of the Lands to Wood’s Homes Society is defeated by the plea of a limitations defence. II. BACKGROUND [ 8 ] The Lands were legally and beneficially owned by the testator, Sydney Wales Metcalfe, (the “Testator”) until his death on September 5, 1968. [ 9 ] In his Last Will and Testament dated January 9, 1959 (the “Metcalfe Will”), the Testator made a series of directions in relation to the Lands. Sub-clauses 4(

e) to 4(

h) of the Metcalfe Will directed that his Executor: • Pay to Wood’s Christian Homes 1/3 of the net income derived from the Lands. • Pay to Barbara Selock 1/3 of the net income derived from the Lands during her lifetime and on her death: o ½ of this share of the net income was to be held for the benefit and education of Sharon Selock until she attained the age of 21 and thereafter to be paid directly to Sharon Selock, and o ½ of this share of the net income was to be paid to Wood’s Christian Homes. • Retain and hold for the benefit and education of Sharon Selock 1/3 of the net income from the Lands until she was the age of 21 and thereafter to be paid directly to Sharon Selock.

Upon the death of Sharon Selock this 1/3 share was to be paid to Wood’s Christian Homes. [ 10 ] Sub-clause 4(

i) of the Metcalfe Will made the following specific bequest: UPON the death of the survivor of BARBARA FRANCES SELOCK and SHARON ANN SELOCK to transfer to the WOOD’S CHRISTIAN HOMES the said [Lands]. [ 11 ] The Metcalfe Will also provided in sub-clause 4(

k) that the residue of the estate be transferred to the Testator’s wife, Frances Adele Metcalfe, provided that she survived him for a period of 30 days but that if she did not survive him for 30 days then the residue was to be transferred to Wood’s Christian Homes. Frances Metcalfe died on May 4, 1969, more than 30 days after the death of the Testator. There is no evidence that she died testate or that any steps were taken for a grant of probate or for a grant of letters of administration. [ 12 ] Wood’s Christian Homes was incorporated as a Society in Alberta on or about May 5, 1921.

It operates as a non-profit organization providing a variety of services to children, youth and families. Operating funds are drawn principally from contracts with and grants from provincial governments across Canada. Capital funding is raised almost entirely from private and community sources. It is a registered charity and does not pay any income tax. On December 31, 2007 it changed its name to Wood’s Homes Society.

In balance of these reasons I will refer to the entity simply as “Wood’s Homes”. [ 13 ] On May 20, 1969, the Surrogate Court of the Southern Judicial District of Calgary granted Probate in relation to the Metcalfe Will to Barbara Frances Selock ... as the sole executrix ...”. Barbara Selock was the daughter of the Testator. [ 14 ] Shortly after the grant of Probate, counsel for the Estate, Barron McBain & Green, wrote to Wood’s Homes to advise that it was a beneficiary of the Estate.

A copy of the grant of Probate was enclosed with counsel’s correspondence. [ 15 ] On May 11, 1972 title to the Lands was transmitted, thus giving rise to a Land Titles Certificate showing the registered owner as “Barbara Frances Selock of R.R. 8 Calgary Alberta Executrix for Sydney Wales Metcalfe”. [ 16 ] For the taxation years 1974 and 1975, Wood’s Homes received T3 information slips from Deloitte Haskins & Sells showing an income allocation in relation the income from the Lands for those years. While there is insufficient evidence to come to any specific

conclusion on this point, it appears that Wood’s Homes did not actually receive the income allocation for those years despite having received the T3 information slips. [ 17 ] After a brief exchange of correspondence with Deloitte Haskins & Sells regarding the T3 information slips, it appears that Wood’s Homes had no further contact with the Executrix or her representatives until sometime in 2018. [ 18 ] Sharon Selock was the daughter of Barbara Selock and the granddaughter of the Testator. Sharon Selock died in 1999. In accordance with sub-clause 4(

g) of the Will, the 1/3 share of the net income that was payable to Sharon Selock during her lifetime became payable to Wood’s Homes. The death of Sharon Selock did not come to the attention of Wood’s Homes until sometime in October of 2018. There is no evidence that Wood’s Homes received any of the net income that had originally been allocated to Sharon Selock. [ 19 ] Barbara Selock, died on or about November 20, 2009. Wood’s Homes was not advised by any representative of her estate that she had died.

However, an obituary was published in relation to the death of Barbara Selock some time shortly after November 20, 2009. This obituary provided notice of the death of Barbara Selock and also referred to the death of her daughter, Sharon Selock in 1999. Furthermore, a Notice to Creditors and Claimants was published in the Calgary Herald on March 10, 2010, giving notice that Barbara Selock had died on November 20, 2009. [ 20 ] On March 12, 2010, Lance Selock, the son of Barbara Selock, applied for a grant of probate in relation to the estate of Barbara Selock.

This was granted by the Court on April 28, 2010. [ 21 ] As at the death of Barbara Selock, administration of the Estate of Sydney Wales Metcalfe had not been concluded. Beginning at least on the death of Barbara Selock, and likely much earlier, Lance Selock and his wife, Kathleen Higgins assumed control over and managed the Lands. Kathleen Higgins received a monthly fee for that service. A separate bank account was opened after the death of Barbara Selock and this new account was used for the deposit of rents and the payment of expenses associated with the Lands. [ 22 ] Mr.

Selock deposes in his affidavit that at least by 2013 he was seeking legal advice in relation to his obligations in relation to the Lands. However, he also deposes that the file was handled by a number of different lawyers within the firm and there was uncertainty as to how this matter would proceed. He deposes that “The file then seemed to drop off the radar at the firm”.

Ultimately, he retained his present counsel to deal with the matter. [ 23 ] After the exchange of correspondence with Deloitte Haskins & Sells in the mid 1970s, Wood’s Homes took no steps of any kind in relation to the bequest of the Lands until sometime in late 2018. At that time, they were contacted by an individual who identified himself as Zaakir Karim. Mr. Karim advised that he worked in real estate and had been doing some “due diligence” when the Lands came to his attention. Based on the results of his investigation, Mr.

Karim reported to Wood’s Homes that Barbara Selock had passed away and that Wood’s Homes was “the rightful owner of the Lands”. [ 24 ] Just how Mr. Karim came to be doing “due diligence” and how he concluded that Wood’s Homes was the rightful owner of the Lands is unclear. In his affidavit, Mr. Selock deposes that Mr. Karim’s fiancé is employed with the Wills and Estates group at the law firm he first retained in approximately 2013 to assist him in relation to the Lands. Mr. Selock describes this as an “odd coincidence”.

I come to no conclusion on that issue. [ 25 ] When Wood’s Homes became aware of the death of Barbara Selock, it did some of its own due diligence and discovered that Sharon Selock had died in 1999. Based on the deaths of Barbara Selock and Sharon Ann Selock, Wood’s Homes concluded that it was the beneficial owner of the Lands. On November 6, 2018 it filed a caveat to protect its interest. [ 26 ] Title to the Lands continued to be in the name of “Barbara Frances Selock ...

Executrix of the Estate of Sydney Wales Metcalfe” even after the death of Barbara Selock and even after probate was granted in relation to her estate. It was not until August 22, 2019 that title was transmitted to “Lance Kenneth Selock ... Executor for Sydney Wales Metcalfe”. [ 27 ] Wood’s Homes retained counsel to provide advice in relation to the Lands and the income that had been earned from the Lands since the death of the Testator in 1968. This resulted in the applications before Justice Anderson in February 2020 and Justice Marriott in April 2020.

Since that time the Limited Administrator has assumed responsibility for the Lands which are now registered in his name as Limited Administrator of the Estate of Sydney Wales Metcalfe. [ 28 ] On April 26, 2019, Wood’s Homes commenced proceedings as action number 1901-05931 (the Wood’s Action) against the Executor of the Estate of Sydney Wales Metcalfe and other individuals claiming breach of trust, breach of fiduciary duties, knowing receipt and negligence.

Wood’s Homes seeks relief consisting of an accounting of all revenues generated from the Lands since the death of the Testator in 1968, disgorgement of net income and damages. It also seeks title to the Lands or damages in the alternative. Statements of Defence have been filed in the Wood’s Action raising defences under the Limitations Act , RSA 2000, c L-12 along with other defences. III. Position of the Parties [ 29 ] The Limited Administrator seeks advice and direction regarding the Lands, which represent the single asset of the Metcalfe Estate that he administers.

More specifically he seeks an Order authorizing the transfer of legal title to the Lands to Wood’s Homes along with all funds in his possession that have been generated from the Lands since the death of Barbara Selock in November 2009.

The Applicant’s position is based on his duty to fulfill the specific bequest in the Metcalfe Will. [ 30 ] The Respondent, Lance Selock, argues that it would not be appropriate to grant the relief requested by the Applicant since it “is patently an attempt to avoid proceeding with the litigation commenced by Wood’s Homes Society against the Estate of Sydney Wales Metcalfe” and is an attempt to “avoid litigating the limitations of actions defence filed by the Estate in the Wood’s Action”.

[ 31 ] Lance Selock argues in para 3 of his Brief that the Lands are not being held for the benefit of Wood’s Homes but instead might actually be held for the benefit of Lance Selock and his sister: The defence of expiry of the limitation period is a strong defence, extremely likely to succeed.

If it succeeds then the Respondent Lance Selock and his sister inherit the Lucerne Apartments as ultimate residuary beneficiaries of the Estates of Sydney Wales Metcalfe, his deceased wife and of Barbara Frances Selock. [ 32 ] On these grounds, the Respondent, Lance Selock, seeks a dismissal of the application. [ 33 ] The Respondent, Wood’s Homes, does not oppose the application and supports the position of the Applicant. It seeks a direction that the Limited Administrator should transfer the Lands to Wood’s Homes. IV. Analysis A.

Duty of the Limited Administrator [ 34 ] Neal Halstead was lawfully appointed as the Limited Administrator of a portion of the Metcalfe Estate. He holds legal title to the Lands and the proceeds arising from the operation of the Lucerne Apartment during the period subsequent to November 2009 in his capacity as Limited Administrator. He is a fiduciary. His duty is to act in the best interests of the beneficiary, Wood’s Homes. He is required to fulfill the wishes of the Testator as described in the Will. [ 35 ] The evidence is very clear and uncontradicted. The Metcalfe Will in sub-paragraph 4(

i) requires that on the death of the survivor of Barbara Selock and Sharon Selock the Lands will be transferred to Wood’s Homes. [ 36 ] The Limited Administrator has no discretion in this regard. He must transfer the Lands to Wood’s Homes unless the Court directs that he cannot do so. [ 37 ] The only real issue on this application is whether there is some basis on which the Court can give advice to the Limited Administrator that he should not fulfill his fiduciary duty and that he should not comply with the very clear intention of the Testator as describe in the Metcalfe Will. B.

Burden and Standard of Proof [ 38 ] While the Limited Administrator seeks advice and direction of the Court, it is apparent that this application involves a consideration of potential limitation defences that may defeat the bequest to Wood’s Homes. This is the very same issue that has been raised in the Wood’s Action. As a result, the advice and direction that I give to the Limited Administrator could effectively amount to granting partial

summary judgement in the Wood’s Action. For this reason, I conclude that it is necessary to proceed on this application by applying the

summary judgment principles as described in Weir-Jones v Purolator, 2019 ABCA 49 . At paragraph 47 the Court of Appeal summarized the principles: The proper approach to

summary dispositions, based on the Hryniak v Mauldin test, should follow the core principles relating to

summary dispositions, the standard of proof, the record, and fairness. The test must be predictable, consistent, and fair to both parties. The procedure and the outcome must be just, appropriate, and reasonable. The key considerations are: (

a) Having regard to the state of the record and the issues, is it possible to fairly resolve the dispute on a

summary basis, or do uncertainties in the facts, the record or the law reveal a genuine issue requiring a trial? (

b) Has the moving party met the burden on it to show that there is either “no merit” or “no defence” and that there is no genuine issue requiring a trial? At a threshold level the facts of the case must be proven on a balance of probabilities or the application will fail, but mere establishment of the facts to that standard is not a proxy for

summary adjudication. (

c) If the moving party has met its burden, the resisting party must put its best foot forward and demonstrate from the record that there is a genuine issue requiring a trial. This can occur by challenging the moving party’s case, by identifying a positive defence, by showing that a fair and just

summary disposition is not realistic, or by otherwise demonstrating that there is a genuine issue requiring a trial. If there is a genuine issue requiring a trial,

summary disposition is not available. (

d) In any event, the presiding judge must be left with sufficient confidence in the state of the record such that he or she is prepared to exercise the judicial discretion to summarily resolve the dispute. To repeat, the analysis does not have to proceed sequentially, or in any particular order. The presiding judge may determine, during any stage of the analysis, that

summary adjudication is inappropriate or potentially unfair because the record is unsuitable, the issues are not amenable to

summary disposition, a

summary disposition may not lead to a “just result”, or there is a genuine issue requiring a trial. [ 39 ] Because limitation defences have been raised on this application and also in the Wood’s Action, s 3(5) of the Limitations Act imposes a burden on Wood’s Homes to prove that a remedial order was brought within the two-year limitation period described in s 3(1) (a). The burden of proof in relation to the ultimate limitation period in s 3(1)(

b) is not on Wood’s Homes, but, for the reasons I will give later, the 10-year ultimate limitation period is not engaged in this case. [ 40 ] Therefore, the burden is on Wood’s Homes in relation to the limitation issue. C. Do Limitation Issues Prevent Distribution to Lawful Beneficiary?

i. Obligations as Executor or as Trustee [ 41 ] Before considering any potential limitation defences that might arise in these circumstances, it is important to clearly distinguish between the nature of the rights that were granted to Wood’s Homes in the Metcalfe Will. In this regard the Metcalfe Will makes two completely different grants to Wood’s Homes: i. Net Income from the Lands – Clauses 4(

e) to 4(

h) These sub-clauses provide the executor with direction regarding the manner in which the net income from the Lands should be allocated and distributed from the date of the Testator’s death until the deaths of Barbara Selock and Sharon Selock. ii. Transfer of Title to the Lands – Clause 4(

i) This sub-clause directs the executor to transfer the Lands to Wood’s Homes on the death of the latter of Barbara Selock and Sharon Selock. [ 42 ] On this application the Limited Administrator does not seek any advice or direction in relation to the allocation or distribution of net income from the Lands as described in clauses 4(

e) to 4(

h) of the Metcalfe Will. Whether those clauses give rise to a testamentary trust which became constituted on the death of Sydney Wales Metcalfe, or whether the trust terms are uncertain, or whether any limitation defences are available as a defence to the claims of Wood’s Homes in relation to net income are issues that are not properly before me on this application. Those are issues that will be determined by the trial judge in the Wood’s Action. I will therefore make no comments with respect to those issues other than to say that the limitation issues that relate to claims to net income arising from clauses 4(

e) and 4(

h) involve considerations that are much different than the limitation issues involving the advice and direction the Limited Administrator seeks in relation to clause 4(i). [ 43 ] Therefore, when considering potential limitation issues, my analysis is restricted to whether the Limited Administrator should refrain from transferring legal title to Wood’s Homes because of potential limitation defences that are specifically related to claims under clause 4(

i) of the Metcalfe Will. [ 44 ] The grant in clause 4(

i) of the Metcalfe will is a specific bequest. The executor of the Metcalfe Will was directed to transfer the Lands to Wood’s Homes on the death of the latter of Barbara Selock and Sharon Selock. On the happening of that event, and provided that Wood’s Homes existed at the time (which it did), then Wood’s Home became the vested beneficial owner of the Lands and the executor was directed to transfer the Lands to Wood’s Homes. [ 45 ] Lance Selock suggests that a testamentary trust was created by the Metcalfe Will. [ 46 ] While it is not necessary for me to resolve this issue on the present application, it is certainly possible that a testamentary trust was created by sub-clauses 4(

e) to 4(

h) of the Metcalfe Will. However, even if a testamentary trust was created by those sub-clauses in relation to the allocation and distribution of net income, that testamentary trust did not affect the obligation of the executor to transfer the Lands to Wood’s Homes, as directed by sub-clause 4(

i) of the Metcalfe Will. Donovan W.M. Waters, Law of Trusts in Canada , 5th ed (Toronto: Thomson Reuters Canada Ltd, 2021) at para 3.II.6 in electronic edition, explains that while the role of a personal representative is very much like the role of a trustee, there are differences between the two roles. The authors explain that the differences are less extensive than the similarities.

The key difference between the two roles is that a trustee manages property that can be enjoyed by a succession of persons over time whereas the personal representative is merely concerned to wind up the estate and to distribute the assets. [ 47 ] In the present case, on the death of Barbara Selock and Sharon Selock, the executor had only one function in relation to the Lands. That was to transfer to Wood’s Homes. The executor had no responsibility at that point to manage the Lands for the benefit of anyone else.

For this reason, the personal representative had obligations under clause 4(1) as executor and not as trustee. [ 48 ] I conclude that on the death of Barbara Selock, her executor, Lance Selock, became the executor of the Estate of Sydney Wales Metcalfe by devolution of executorship. He acknowledged his responsibility in this regard when the Lands were transmitted to him as “Executor for Sydney Wales Metcalfe”. Lance Selock became a fiduciary in relation to the Lands and owed a duty to report to the beneficiaries, including Wood’s Homes.

Lance Selock had a further fiduciary duty to comply with the wishes of the Testator and to deal with the Lands in the manner directed in the Metcalfe Will. [ 49 ] However, even if I am wrong in my conclusion that the law of executorship should be applicable, the result would be the same on the application of the law of trusteeship. For the reasons given by the Court of Appeal in Wood’s Homes Society v Selock , 2021 ABCA 431 , even if the Lands became subject to a testamentary trust, the testamentary trust did not come to an end on the death of Barbara Selock. Lance Selock had continuing duties as a trustee.

This was explained by the Court of Appeal at para 25 to 26 of the reasons: We are satisfied that, if the Lands were placed into a testamentary trust by Sydney’s will, that trust would not have terminated on the death of Barbara, the sole surviving trustee. We were not pointed to any authority that would lead to that result. A trust comes to a close when the terms of the trust have been carried out: Waters at p 1315. That has not happened here. Moreover, there has been no application for judicial approval to vary or terminate the trust pursuant to s 42 of the Trustee Act .

As to Lance’s status with respect to the Lands, pursuant to s 14(1)(

b) of the Trustee Act , Lance, as executor of the sole surviving trustee, had the authority (and perhaps the obligation) to appoint a new trustee to oversee the administration of the Lands. He did not do so, instead electing to take on the administration of the trust property, including continuing to pay his wife for her management services. If the Lands are trust property, we are satisfied that Lance took on the role of trustee de son tort or de facto trustee. [ 50 ] Even if a testamentary trust was created by clause 4(i), Lance Selock’s status as trustee de son tort or de facto trustee would

closely parallel his duties as executor. As a trustee, he owed fiduciary duties to Wood’s Homes and he was required to discharge those duties by transferring title to the Lands to Wood’s Homes. He failed to do so. ii.

Plea of Limitation Defence [ 51 ] The critical issue on this application for advice and direction is whether a limitation defence defeats the bequest of the Lands to Wood’s Homes. [ 52 ] Lance Selock argues that the Limited Administrator should be prohibited from transferring legal title to the Lands to Wood’s Homes because the Limitations Act provides the Metcalfe Estate with a defence that has been pleaded and, if successful, would prevent the transfer. [ 53 ] In oral submissions, Mr.

Selock conceded that on the death of Barbara Selock on November 20, 2009, Wood’s Homes became the vested beneficial owner of the Lands and became entitled to demand a transfer of legal title to the Lands. Lance Selock argues that Wood’s Homes was aware of the terms of the Metcalfe Will as early as 1969 when it received a copy of the probate documents from counsel for the Estate. He further argues that Wood’s Homes knew or ought reasonably to have known that the condition of sub-paragraph 4(

i) of the Will had been fulfilled when Barbara Selock died on November 20, 2009, but despite this, Wood’s Homes took no steps to seek a transfer of the Lands. Lance Selock further argues that, after the passage of 2 years from the death of Barbara Selock, the Estate of Sydney Wales Metcalfe was permitted to raise the defence arising from the Limitations Act . In his capacity as Executor of the Metcalfe Estate, he raised the limitation defence in the Wood’s Action.

In these circumstances, Lance Selock argues that the Limited Administrator should be prohibited from transferring the Lands to Wood’s Homes until the Court has ruled on the limitation defence in the Wood’s Action. [ 54 ] I observe that the submissions of Lance Selock regarding the availability of a limitation defence are equally applicable whether the Lands are held by him as the executor pursuant to the Metcalfe Will or whether the Lands are held by him as a trustee pursuant to a testamentary trust arising from the Metcalfe Will. iii.

The Applicable Limitation Period [ 55 ] The Limitations Act creates two potentially relevant limitation periods. The first limitation period is found in s 3(1)(

a) and provides a defence where a remedial order is not sought within 2 years from the date on which the “claimant first knew, or in the circumstances ought to have known” that the injury had occurred, that the injury was attributable to the conduct of the defendant, and that the injury warranted bringing a proceeding: s 3(1)(a)(i) - (iii) of the Limitations Act . Injury is defined in s 1 of the Limitations Act as including “non-performance of an obligation”. [ 56 ] The second limitation period is found in s 3(1)(

b) and is the ultimate limitation period that provides a defence where a claimant fails to seek a remedial order within 10 years after the claim arose. In this case only the first limitation period is relevant because Wood’s Homes did seek a remedial order before the expiry of the ultimate limitation period when it issued a Statement of Claim in the Wood’s Action on April 26, 2019. [ 57 ] The earliest the limitation period could have commenced was on the date of the death of Barbara Selock on November 20, 2009. Sharon Selock died sometime in 1999 and thus the Barbara Selock was the last survivor. Her death satisfied the condition in clause 4(

i) of the Metcalfe Will. This was the date on which beneficial ownership of the Lands first vested in Wood’s Homes. This was the first date on which Wood’s Homes could have demanded that title be conveyed to it. This was the earliest date on which the limitation period could have started to run. [ 58 ] On this application I will assume, without deciding, that the limitation period began to run on November 20, 2009. It might have commenced much later than this because the duty of the executor is to satisfy bequests as soon as practicable, not on the first date on which the conditions are satisfied.

However, assuming the limitation period began to run on November 20, 2009 is the most favourable assumption permissible on the evidence from the perspective of the Respondents. It presents the highest threshold that the Limited Administrator must meet. [ 59 ] The issue then is whether the Statement of Claim in the Wood’s Action was issued within 2 years from when Wood’s Homes first knew, or in the circumstances ought to have known that the conditions in s 3(1)(a)(

i) to (iii) had been met. This turns on the question of whether Wood’s Homes knew or ought to have known that an injury had occurred as required by s 3(1)(a)(i). The injury was the failure of the executor in his obligation to transfer title to the Lands on the death of the latter of Sharon Selock and Barbara Selock as had been directed in sub-clause 4(

i) of the Metcalfe Will. iv. No Actual Knowledge [ 60 ] Knowledge of the s 3(1) elements requires more than mere suspicion but less than perfect knowledge: Mitchell v Pytel , 2021 ABQB 403 at para 278 ; Kydd v Abolarin , 2011 ABQB 690 , Macklin J at paras 36, 29; Sztuczka v Knebel , 2012 ABQB 72 , Mason M at para 11(3); De Shazo v Nations Energy at paras 31-32; Weir-Jones Technical Services Inc v Purolator Courier Ltd , 2019 ABCA 49 at para 58 .

There is no statutory requirement that a claimant have “clear information” respecting an injury: Canadian Natural Resources Ltd v Jensen Resources Ltd , 2013 ABCA 399 at para 41 . [ 61 ] The evidence is clear and uncontradicted. I conclude that Wood’s Homes did not actually discover that both Sharon Selock and Barbara Selock had died until a representative of Wood’s Homes was approached by Mr. Karim in October 2018. Thus, Wood’s Home did not have actual knowledge that the condition in clause 4(

i) had been satisfied and that it had a vested beneficial ownership interest in the Lands until October 2018. Therefore, a limitation defence is not available based upon Wood’s Homes’ actual knowledge of the injury.

v. Discoverability Principle [62] The primary issue on this application is whether Wood’s Homes ought to have known before October 2018 that both BarbaraSelock and Sharon Selock had died, thus satisfying the conditions in clause 4(

i) of the Metcalfe Will and requiring the executor totransfer title to the Lands. This engages the discoverability principle. [63] In Grant Thornton v New Brunswick, 2021 SCC 31, the Supreme Court provided an explanation of the discoverabilityprinciple at common law and in the New Brunswick legislation. Writing for the Court, Justice Moldaver said:

Section 5 of the LAA operates against the backdrop of a common law discoverability rule that is well-established. Under that rule, “acause of action arises for purposes of a limitation period when the material facts on which it is based have been discovered or ought tohave been discovered by the plaintiff by the exercise of reasonable diligence” (Central Trust Co. v. Rafuse, (SCC),[1986] 2 S.C.R. 147, at p. 224, citing Kamloops (City of) v. Nielsen, (SCC), [1984] 2 S.C.R. 2; see also Ryan v. Moore,2005 SCC 38, [2005] 2 S.C.R. 53, at paras. 2 and 22). This rule has its origins in equity.

In particular, it seeks to balance the threerationales for imposing limitation periods — the guarantee of repose, the desire to foreclose claims based on stale evidence and theexpectation that a plaintiff will start a claim in a timely manner (M. (K.) v.

M. (H.), (SCC), [1992] 3 S.C.R. 6, at pp. 29-30) — with the need to avoid the injustice of precluding a claim before the plaintiff even has knowledge of its existence (Peixeiro v.Haberman, (SCC), [1997] 3 S.C.R. 549, at para. 36). [64] The test for discoverability is largely objective and looks at what a reasonable person in the same circumstances would haveeither known or discovered with some diligence: Saito v Lester Estate, 2021 ABCA 179 at para 21; Boyd v Cook, 2013 ABCA 27 atpara 28.

However, as explained in Milota v Momentive Specialty Chemicals, 2020 ABCA 413 at para 22, while the test is “primarilyobjective, courts may consider aspects of the plaintiff’s circumstances in determining whether a reasonable person would concludeproceedings were warranted: Yugraneft Corp v Rexx Management Corp, 2010 SCC 19 at paras 60-61, [2010] 1 SCR 649.

Adefendant’s statements, actions or omissions can affect a plaintiff’s state of knowledge and duty to inquire: Canadian Natural ResourcesLimited at paras 34-36; James H Meek, Jr Trust v San Juan Resources Inc, 2005 ABCA 448 at para 33; Geophysical at para 27.” [65] The uncontradicted evidence is that as early as 1969 Wood’s Homes was aware that it was a beneficiary named in theMetcalfe Will. This knowledge arose from the advice provided by the solicitors for the Metcalfe Estate.

However, Wood’s Estate wasalso aware that the transfer of the Lands could not take place for many years or decades until the deaths of both Barbara Selock andSharon Selock. [66] In cross-examination on his affidavit, Peter Wittig, the Director of Operations of Wood’s Homes, gave a clearacknowledgment that prior to October 2018, Wood’s Home took no steps to attempt to determine whether Barbara Selock and SharonSelock were alive or dead. Thus, Wood’s Homes took no steps to determine whether it had a right to demand a transfer of title to theLands.

This was because the knowledge that Wood’s Homes had in relation to the Metcalfe Will had been lost over time as the staffmembers and as the Board of Directors changed, although the old files containing the letter from counsel for the Metcalfe estate was stillin storage. In his affidavit filed November 6, 2019, Peter Wittig, explained this at para 42: I have conducted a thorough inquiry of Wood’s Homes records and staff members for information related to the Estate. As a result ofmy inquiry, I believe that prior to Mr.

Karim’s contact with Mr. van Dalen, no one at Wood’s Homes had any knowledge of the Estate,the Will or Wood’s Homes entitlement thereunder. It appears that this information was lost, likely in the 1970s when Wood’s Homes’board underwent a significant reorganization. [67] Had Wood’s Homes conducted inquiries, some publicly available information could have been discovered including: • An obituary was published in a newspaper in relation to the death of Barbara Selock some time shortly after November 20, 2009.

This obituary provided notice of the death of Barbara Selock and also referred to the death of her daughter, Sharon Selock in 1999. Thisobituary was located by Wood’s Homes in 2018 during searches it undertook after being advised by Mr. Karim that Wood’s Homes wasthe beneficiary of the Lands. • Lance Selock filed with the Court an application for probate in relation to the death of Barbara Selock. However, the applicationfor probate represented that there are no deceased children, thus at least implying that Sharon Selock was not deceased.

However, thesame application fails to disclose that Sharon Selock as one of Barbara Selock’s children. • A Notice to Creditors and Claimants was published in the Calgary Herald on March 10, 2010 which made clear that BarbaraSelock had died on November 20, 2009. This Notice does not make any reference to the death of Sharon Selock. [68] The threshold question therefore is whether a reasonable person in the same circumstances as Wood’s Homes would haveeither known of the deaths of Barbara Selock and Sharon Selock, or could have discovered with some diligence that the deaths hadoccurred.

Since Wood’s Homes took no steps, the question becomes whether, a reasonable person in the same circumstances as Wood’sHomes would have taken no steps to determine whether the deaths had occurred. [69] To meet its burden in relation to the discoverability principle, a Plaintiff will generally need to provide evidence that he or shetook some active steps to satisfy the reasonable diligence requirement. This was explained by Justice Poleman in McDonnell v Csaki,2014 ABQB 452 at para 28: ... It will not suffice to wait idly for information to come to hand.

Some research and inquiry may be expected of a reasonable plaintiff aspart of determining what ought to have been known: Saxton v Credit Union Deposit Guarantee Corporation, 2004 ABQB 631, paras 29and 30; Owners: Condominium Plan 9421549 v Main Street Developments Ltd, (AB KB), 2004 ABQB 962, revd onother grounds 2006 ABCA 194, para 74(QB).

The burden is not high to establish at least a triable issue on due diligence, but it is usuallyexpected that the plaintiff to put forward some evidence of steps taken to ascertain the identity of tortfeasors and give a reasonableexplanation for why information was not obtainable with due diligence earlier ... and doing nothing for two years after an accident

except possibly requesting a police report will not usually amount to due diligence: Wakelin v Gourley (2005), (ONSC), 76 OR 272 (Ont M), paras 25 and 26; affirmed, [2006] OJ No 2764 [footnotes omitted but citations added to text] [70] However, in some cases, even where the Plaintiff has not taken any active steps, but has instead simply “remained idle”, thecircumstance may permit a conclusion that the Plaintiff ought not to have know of the “injury”. Whether this conclusion can be reachedrequires an assessment of the circumstances of the Plaintiff and a consideration of the actions of the Defendant.

James H Meek, JrTrust v San Juan Resources Inc., 2005, ABCA 448 is an illustration of a case where the Plaintiff took no active steps but, despite this,the Court of Appeal concluded that it ought not to have known of the “injury”. In Meek, by the terms of a 1952 trust agreement, thePlaintiff was entitled to receive royalty payments in relation to oil and gas production on the lands. The Defendant oil and gas produceracquired its interest in the lands in 1987 and put two wells into production in 1988.

However, at that time the Defendant was unaware ofits royalty obligations in relation to the lands arising from the 1952 agreement. Thus, no royalties were paid to the Plaintiff. ThePlaintiff did not become aware that oil and gas production was taking place on the lands until they were advised of this in 2002 byImperial Oil, which also held an interest in the lands. The Plaintiff immediately commenced an action to recover the royalties from 1988to 2002.

The Defendant raised the Limitations Act in defence. [71] In relation to the issue of discoverability, the evidence was clear that the Plaintiff had taken no steps to determine whether anywells were in production on the lands, and thus the Plaintiff had no knowledge that any royalty payments were outstanding. TheDefendant argued that the Plaintiff had not acted with reasonable diligence because it had a responsibility to ensure that the royaltycontract was being properly performed.

The Defendant argued that if the Plaintiff had taken reasonable steps they would havediscovered that the lands had been in production since 1988 and that royalties were due. On this basis the Defendant asserted that thePlaintiff had not demonstrated due diligence in relation to discoverability and that the Limitations Act was a defence to the claim forroyalties. The Court of Appeal concluded that in the circumstances that existed at the time, the Plaintiff had no obligation to makeinquiries and that the limitation defence was not available. At paras 33 to 34, the Court explained: ...

The Meeks are well-educated and have some business experience but are not directly part of the oil industry. They lived in the UnitedStates, without easy access to material information. Carrington was well-organized and used the information available to her. Royaltyinterest holders often do not have ready access to the documentation that would enable them to determine if there is production from aparticular well and whether they have been paid the royalty owing on that production. A royalty interest holder is entitled to expect theroyalty payor to honour its obligations.

Absent clear information to show improper payment, royalty interest holders are not obliged totake positive steps aimed at ensuring that they are being correctly paid. Although Imperial's new reporting procedures in 2000 made iteasy to know what wells were the subject of royalty payments, Carrington did not have up-to-date information from the AEUB thatwould indicate what wells were in production. In other words, she did not simultaneously have the information that would enable her toput together the two critical pieces of the royalty puzzle. Nor was she obliged to procure the AEUB reports. In

summary, although the trial judge applied the wrong test, he was not wrong to conclude that the Meeks ought not to have known oftheir claim prior to actual notification by Imperial in May 2002. [72] All of the circumstances must be considered when assessing whether a reasonable person in the same circumstances asWood’s Homes would have either known or discovered with some diligence that the conditions in sub-clause 4(

i) had been met and thatit was entitled to demand a transfer of title to the Lands. [73] As early as 1969 Wood’s Homes became aware of the bequest in the Metcalfe Will. It had very limited contact withrepresentatives of the Metcalfe Estate and no contact of any kind from the mid 1970s to 2018. Wood’s Homes knew that it was notentitled to a transfer of the Lands until the death of Barbara Selock and Sharon Selock, which might not occur for many years ordecades. In fact, more than 40 years passed from the death of the Testator before the conditions in sub-clause 4(

i) were satisfied. [74] In most cases where limitation issues are considered, the Defendant has no obligation to contact the Plaintiff to disclose factsthat might give rise to a claim. The Defendant is, in most cases, entitled to remain silent and simply await the passage of the limitationperiod after which he or she will have a valid defence to the claim advanced by the Plaintiff. However, the situation is different inrelation to an executor who holds property in trust for those who have been granted specific bequests in a will. In those situations, theexecutor has fiduciary obligations to the beneficiaries.

The executor has obligations to report and account to the beneficiaries and theexecutor has duties to distribute the assets in a timely manner. The Court of Appeal in Wood’s Homes Society v Selock, 2021 ABCA431 at para 14 described the core tasks of a personal representative: The core tasks of a personal representative when administering an estate are to: identify the estate assets and liabilities; administer andmanage the estate; satisfy the estate debts and obligations; and distribute and account for the administration of the estate (s 7).

Thepersonal representative is required to perform the role honestly and in good faith, in accordance with the testator’s intention and with thewill, and with the care, diligence and skill that a person of ordinary prudence would exercise in comparable circumstances where afiduciary relationship exists, and to distribute the estate as soon as practicable (s 5). [75] As Justice Anderson concluded in her reasons on February 20, 2020, Lance Selock breached his duties to the beneficiaries. She explained: I do not accept that Lance Selock has done nothing wrong. His conduct as executor is very troubling.

He has breached his duties as setout under

section 5 of the Estate Administration Act and refused or failed to fulfill his core duties for which he is responsible as requiredunder

section 7 of the Estate Administration Act. He failed to distribute the estate as soon as practicable. He failed to notify andregularly communicate with Wood’s Homes as beneficiary of the lands. He failed to give any accounting of the administration of theestate required every two years until he was contacted by Wood’s Homes’ counsel. He has failed to administer the estate in a prudentand timely manner. [76] The fiduciary duties owed by Lance Selock as executor were ongoing duties. His duties arose on the death of his mother,Barbara Selock, because of his status as executor named in her will.

The duties of Lance Selock continued when he was granted probatein relation to the estate of Barbara Selock. His duties were acknowledged when title to the Lands was transmitted to him on August 22,

2019 as “Executor for Sydney Wales Metcalfe”. He had a continuing duty to report to Wood’s Homes in accordance with his obligations under the s 7 of the Estate Administration Act and the

schedule to that legislation. He failed on numerous occasions to fulfil his duties. [ 77 ] I conclude that as executor, Lance Selock was not entitled to simply remain silent and to wait for the limitation period to expire. He had a positive duty to report to the beneficiary and to transfer title. He did not discharge those duties. [ 78 ] The duty that Lance Selock had to disclose was magnified in this case because, as he argues in his written submissions, a successful limitation defence would potentially permit him and his sister to take the Lands as the ultimate residuary beneficiaries.

This gave rise to a significant conflict which demanded full disclosure. Lance Selock as executor could not remain silent. He had a duty to advise that the conditions in sub-clause 4(

i) had been satisfied and that Wood’s Homes had a vested beneficial interest in the Lands. He failed to do this. [ 79 ] If the Lands formed part of a testamentary trust, then in his role as trustee de son tort or de facto trustee, Lance Selock breached similar fiduciary duties owed to the beneficiary, Wood’s Homes. [ 80 ] In these circumstances, I conclude that Wood’s Homes was entitled to expect that the executor would fulfill his statutory duties as well as his fiduciary obligations. I conclude that Wood’s Homes was entitled to rely on the executor to properly discharge his duties and to advise when the conditions in sub-clause 4(

i) had been satisfied and thus when it was entitled to receive a transfer of the Lands. [ 81 ] The publication of the obituary announcing the death of Barbara Selock, which referred to the earlier death of Sharon Selock, did not satisfy the obligation of the executor and, in any event, did not come to the attention of Wood’s Homes until 2018. Similarly, the Notice to Creditors and Claimants of Sharon Selock that was published in a newspaper in 2010 did not come to the attention of Wood’s Homes until after the litigation commenced.

I conclude that it is not reasonable to impose an obligation on a beneficiary of a will to monitor newspaper advertisements over 40-year time period to determine whether the conditions in a will have been met. The newspaper publications did not discharge the executor’s duty to the beneficiary. [ 82 ] In the circumstances that exist in this case, as in Meek , Wood’s Homes ought not to have known that Barbara Selock and Sharon Selock had died thus fulfilling the condition in sub-clause 4(i).

As a result, the limitation period did not begin to run until Wood’s Homes had actual knowledge of the deaths of Barbara Selock and Sharon Selock in October 2018. The Wood’s Action was commenced within 2 years and thus the Limitations Act offers no defence to the entitlement of Wood’s Homes to the Lands. vi. Conclusion – Limitations Defence [ 83 ] I am satisfied that the record before me makes it possible to resolve the limitation issue as it relates to sub-clause 4(

i) on a

summary basis and to achieve fairness between the parties. The record is not extensive. However, the record clearly acknowledges that Wood’s Homes took no steps to attempt to determine whether Barbara Selock and Sharon Selock had died. With this acknowledgment no additional evidence would improve the position advocated by Lance Selock. For the reasons already given, in the circumstances of this case, despite having taken no active steps, Wood’s Homes ought not to have known of the deaths of Barbara Selock and Sharon Selock. There are no genuine issues that need to be resolved at trial.

The Limitations Act does not offer a defence to the claims of Wood’s Homes and the limitation issues do not prevent the Limited Administrator from fulfilling his duties to distribute the Lands to Wood’s Homes in accordance with the terms of the Metcalfe Will. [ 84 ] Whether the expiry of a limitation period provides a defence to the claim by Wood’s Homes in relation to sub-clauses 4(

e) to 4(

h) of the Metcalfe Will to recover some or all of the net income from the Lands from 1968 to the death of Barbara Selock is not before me on this application and I express no view on that issue. As I previously observed, the limitation issues in relation to those claims involve much different considerations than those in relation to sub-clause 4(i). Limitation issues relating to sub-clauses 4(

e) to 4(

h) can only be determined in the Wood’s Action. V. CONCLUSION [ 85 ] For these reasons, I give the following advice and direction to the Limited Administrator:

a) Beneficial ownership of the Lands became fully vested in Wood’s Homes on November 20, 2009 upon the death of Barbara Selock;

b) The Lands were held by Lance Selock from November 20, 2009 for the sole benefit of Wood’s Homes until the appointment of Limited Administrator on February 20, 2020.

c) From February 20, 2020 until the present time the Limited Administrator has held the Lands for the sole benefit of Wood’s Homes;

d) The Limited Administrator is authorized to transfer title to the Lands to Wood’s Homes, along with any income generated from the Lands since November 20, 2009 that are in the possession of the Limited Administrator;

e) Upon transfer of the Lands and income generated from the Lands as described above, the Limited Administrator will be discharged from his duties in relation to the Metcalfe Estate.

[ 86 ] If the parties are not able to agree on costs they may provide written submissions on the issue to be delivered within 60 days from the date of release of these reasons. Heard on the 30 th day of November, 2021. Dated at the City of Calgary, Alberta this 29th day of December, 2021. John T. Henderson J.C.Q.B.A. Appearances: Predrag Tomic for the Applicant C. Michael Smith for the Respondent Lance Kenneth Selock Cassidy Bishop for the Respondent Wood’s Homes Society