Lay v Lay, 2024 ABCA 26

In the Court of Appeal of Alberta Citation: Lay v Lay, 2024 ABCA 26 Date: 20240125 Docket: 2301-0187AC Registry: Calgary Between: Terry Lay Appellant (Plaintiff) - and - Bradley Lay, Michael Lay Respondents (Defendants) _______________________________________________________ The Court: The Honourable Justice Dawn Pentelechuk The Honourable Justice April Grosse The Honourable Justice Alice Woolley _______________________________________________________ Memorandum of Judgment Appeal from the Decision by

The Honourable Justice D.K. Miller Dated the 20th day of July, 2023 ( Docket: ES08 21935) _______________________________________________________ Memorandum of Judgment _______________________________________________________ The Court: [ 1 ] Terry Lay appeals the decision of the case management judge dismissing his application for an order holding the respondents, Bradley Lay and Michael Lay, in contempt of a May 25, 2021 order granted by a different judge. [ 2 ] This appeal is a small part of longstanding litigation between the parties, who are brothers.

The litigation relates to the administration of the estates of their parents, Donald Lay and Beryl Lay. [ 3 ] Terry asserts that funds are “missing” from his mother’s estate, having questioned the respondents – both executors of the estate of Beryl Lay – as to its management. The parties disagreed over what information was relevant. [ 4 ] The contempt application involves alleged non-compliance with an order granted by Devlin J on May 25, 2021 in relation to Beryl Lay’s estate. The

preamble to the order refers, in part, to Terry’s application to compel answers to undertakings requested at the Questioning of Michael Lay in February 2021. [ 5 ] The following paragraphs of the order are in issue: 4. The executors Michael and Bradley Lay shall seek, obtain and preserve the financial records of the Estate; 5. Once Bradley Lay and Michael Lay are in possession of all the financial accounts of the late Ms. Lay in their role as executors, they will provide to Terry Lay details of all of Beryl Lay’s bank and financial accounts from the date of her death in 2016 to present.

This will include all accounts identified in undertakings 40, 41, 42 and 43 requested at the questioning of Michael Lay. Those records will be conveyed to Mr.

Terry Lay in advance of the completion of the administration of the Estate, as soon as they are obtained [emphasis added]. [ 6 ] The referenced undertakings sought that the executors “[p]rovide all account statements and related information pertaining to” a TD Trust account ending in 879 (Undertaking 40), an RBC Dominion Securities RRIF account ending in 901 (Undertaking 41), and an RBC Dominion Securities Non-registered account ending in 494 (Undertaking 42).

It is conceded that Undertaking 43 has been complied with. [ 7 ] The respondents provided Terry with a Statement of Accounting in May 2022, and then applied in August 2022 to dispense with a formal passing of accounts in relation to Beryl’s estate. In October 2022, Terry filed a Notice of Objection. [ 8 ] The respondents filed an application seeking security for costs against Terry. On March 28, 2023, Terry filed an application seeking, among other relief, an order finding the respondents in civil contempt for non-compliance with paragraphs 4 and 5 of the Devlin J order.

Both the contempt and security for costs applications came before the case management judge on July 20, 2023 as part of a suite of applications brought by both parties. In brief oral reasons delivered from the bench, the case management judge dismissed the contempt application and granted security for costs against Terry, to be posted by August 31, 2023, failing which the scheduled application for formal passing of accounts would be dispensed with and the respondents would be permitted to complete the administration of the Beryl’s estate.

Terry did not post the security for costs as ordered and did not seek permission to appeal this aspect of the case management judge’s order. We are advised the estate has now been substantially distributed. [ 9 ] The first point, then, is that this appeal appears to be moot. We will nonetheless address the appeal on its merits, given mootness was not raised by the respondents. [ 10 ] Paragraphs 4 and 5 of the May 25, 2021 order involve interpreting the scope of the documentation ordered. The

interpretation of the terms of a court order is a question of law reviewed for correctness. Such

interpretation is made by reading the language of the order as a whole, in the context of the pleadings and the circumstances in which the order was granted: Alberta Health Services v Pawlowski , 2022 ABCA 254 at paras 50-51 . [ 11 ] We have reviewed the record before us, including the exchange of correspondence between counsel, the Statement of

Accounting filed by the respondents and Terry’s Notice of Objection. We are satisfied that paragraphs 4 and 5 of the order were complied with. Specifically, financial disclosure regarding the two main accounts held by the estate – TD Bank and RBC Dominion Securities – was provided. Terry’s main complaint appears to be the respondents’ failure or refusal to produce “bank source documents”.

In his view, the respondents through gaps in production, have failed to prove his concerns to be wrong. [ 12 ] To establish civil contempt, a party must prove beyond a reasonable doubt that an order clearly and unequivocally stated what should or should not be done, that the other party had actual knowledge of the order, and that the other party intentionally breached those clear terms: Carey v Laiken , 2015 SCC 17 at paras 32-35 [ Carey ]; Law Society of Alberta v Beaver , 2021 ABCA 163 at para 15 . [ 13 ] The Devlin order does not specify the granularity of production that Terry claims.

The chambers justice made no reviewable error in finding that Terry had not proven beyond a reasonable doubt that the respondents did not comply with the Devlin order. In any event, and as emphasized in the proceedings before the chambers justice, there is no evidence the respondents “intentionally failed to do the act that the order compels”: Carey at para 35 . [ 14 ] Before the case management judge, Terry sought an order compelling the respondents to “provide sworn confirmation that they have complied with paragraph 4”, namely that the requested financial documents had been preserved.

That request went beyond the terms of the order and could not form the basis for a finding of contempt. [ 15 ] It is unfortunate this proceeded by way of a contempt application as opposed to an application for further and more complete documentation. [ 16 ] The appeal is dismissed. [ 17 ] The respondents argue that solicitor-client costs are often awarded in cases where a party is held in contempt. They argue a similar scale should apply when a contempt application is dismissed and the appeal is without merit. The respondents also point to Terry’s “malfeasance” throughout this longstanding litigation.

As this Court has stated, solicitor-client costs are generally reserved for reprehensible, scandalous or outrageous conduct by a party and in rare and exceptional circumstances: Goldstick Estates (Re), 2019 ABCA 508 at para 24 ; Fech v Lewington , 2022 ABCA 154 at para 30 . We decline to order solicitor-client costs in this instance. The respondents are awarded party and party costs on the appropriate column plus all reasonable disbursements. Appeal heard on January 19, 2024 Memorandum filed at Calgary, Alberta this 25th day of January, 2024 Pentelechuk J.A. Authorized to sign for: Grosse J.A.

Authorized to sign for: Woolley J.A. Appearances: Appellant, Terry Lay J.P. Tieman

for the Respondents