IRMA THÉRIAULT, Applicant, – v. –, 2022 NBQB 144

IN THE COURT OF QUEEN’S BENCH OF NEW BRUNSWICK TRIAL DIVISION JUDICIAL DISTRICT OF MONCTON Thériault v. Robichaud et al 2022 NBQB 144 BP-75-2017 2022/07/21 BETWEEN: IRMA THÉRIAULT, Applicant, – and – ALMA ROBICHAUD and ÉMILE LANDRY in their capacity as interim administrators of the estate of Delphis Mallet and estate of Delphis Mallet, Respondents. DECISION BEFORE: Madam Chief Justice Tracey K. DeWare AT: Bathurst, New Brunswick DATE OF HEARING: June 6 and 7, 2022 DATE OF DECISION: July 21, 2022

APPEARANCES: Mario J. Lanteigne, for the applicant Irma Thériault Carole Sirois-Paquette, for the respondent Alma Robichaud Claude Duguay, for the respondent Émile Landry [TRANSLATION] DeWare, C.J. Introduction [ 1 ] The applicant, Irma Thériault (hereinafter “the applicant”), seeks a court order confirming the removal of the respondent, Alma Robichaud (hereinafter “the respondent”), as interim administrator of the estate of Delphis Mallet and an order confirming the replacement of the respondent by Daniel Brassard.

The respondent opposes the remedies sought by the applicant and asks the Court to issue an order confirming that the legal bills the respondent has had to pay personally to date be paid by the estate of the late Delphis Mallet. Facts [ 2 ] The record in this case calls for a determination of the validity of two wills and the testamentary capacity of the late Delphis Mallet at the time the wills were signed. The late Delphis Mallet signed two wills during his lifetime, one dated September 28, 1994, and the other dated July 29, 2014.

Delphis Mallet died on November 16, 2017. [ 3 ] The parties in this case were already before the Court prior to the death of Delphis Mallet. In 2014, an application, later converted into an action, was filed seeking an order recognizing the validity of a power of attorney signed by Delphis Mallet in 1994.

The respondent was the applicant in that proceeding and she argued that Delphis Mallet was unable by reason of medical incapacity to sign legal documents, including a new power of attorney and a new will in 2014. [ 4 ] Following the death of Delphis Mallet in 2017, the parties remain before the Court now because of the dispute over the validity of the two wills. The parties in this application – Irma Thériault and Alma Robichaud – are two of Delphis Mallet’s daughters. Delphis Mallet had 11 children, of whom, as I understand it, 10 are still living. This litigation has divided the family.

The children Albanie Mallet, Sylvain Mallet and Rénald Mallet, as well as Delphis Mallet’s former spouse, Yvette Kenny, support the position put forward by the applicant. The children Marguerite Duguay, Lisa Albert, Julien Mallet, Delphis J. Mallet and Jean-Yvon Mallet support the position advanced by the respondent. [ 5 ] On March 13, 2018, the respondent, Alma Robichaud, and Émile Landry were appointed temporary co-administrators of the estate of the late Delphis Mallet. The two co-administrators were appointed pursuant to an Order of Léger, J.

With the consent of all parties, Émile Landry was relieved of his duties as co-administrator at the hearing on June 6, 2022. Issues before the Court [ 6 ] The trial in this matter to determine the validity of the 2014 will and the issue of the testamentary capacity of the late Delphis Mallet in 2014 is scheduled for the week of January 23, 2023. In the interim, it is necessary that there be an administrator of the estate. The issue to be determined in this application is whether the respondent should be removed from her role as administrator and whether the Court should appoint a new administrator.

The respondent also asks that her legal bills incurred to date be reimbursed by the estate.

Law and Analysis [7] The applicant maintains that the respondent cannot continue to act as the interim administrator for a number of reasons,including that she has a conflict of interest. The applicant argues that there is an inherent conflict of interest in the appointment of therespondent as interim administrator. According to the applicant, the respondent has a personal interest in the determination of the validityof the 2014 will given that she takes a smaller share of the estate under that will. [8] The applicant points the Court to the comments of Walsh, J. in Williams v.

Breau et al, 2020 NBQB 85 , on the issues acourt must consider following an application for the removal of a trustee, at paras. 13 and 40: 13 At common law, apart from deliberate misconduct (e.g. breach of trust), the authorities reflect that there can be any number of causes(grounds) which might (not shall) result in the removal of an executor/executrix or administrator of a person’s estate. These include lackof capacity to act, conflict of interest, and friction/hostility, although the latter is not itself considered a stand-alone ground (See:Timothy C.

Matthews, Q.C., The Appointment, Retirement, Removal and Replacement of Trustees in the Atlantic Provinces (2009)28 Estates, Trusts & Pensions Journal 302 at p. 305). Given the pleadings and evidence, I propose to address the request to removeMs. Williams based on those other grounds. 40 In Fleming v. Fleming, it is explained that: ... A conflict of interest occurs whenever the personal interest of the personal representative conflicts with the interests of others forwhom he or she has a duty to act.

Clearly, whenever a person who is entitled to a share in an estate is appointed an administrator of thatestate, there is a possibility that he or she will act improperly to favour himself or herself over other beneficiaries. Yet, the rules of courtexpressly contemplate that such persons may serve and, indeed, have a right of priority to appointment, as administrator. See, Rule 56.02.That fact alone, therefore, will often not be sufficient to constitute a conflict of interest justifying removal.

Where, however, the natureof the personal interest of the administrator is such that he or she will inevitably, or even will likely, be placed in a conflictsituation with respect to specific decisions involving the administration of the estate that may have the effect of the administratornot maintaining an even hand between beneficiaries or place him or her in a difficult situation with respect to maintainingimpartiality, that will be enough. In Re Walter W.

Shaw Co., (SK KB), [1922] 3 W.W.R. 119, MacDonald J. said atp. 120 that “The question is whether it would be difficult for the trustee to act impartially, not whether, in fact, it would or wouldnot do so”. [Emphasis mine.] [9] According to the applicant, the following factors make it impossible for the respondent to continue as interim administrator:

(1) The respondent is the party challenging the validity of the July 29, 2014, will on the grounds of testamentary incapacity;

(2) The respondent takes a larger share of the estate under the 1994 will and she is named the executrix in September 1994 but not inJuly 2014; and

(3) The respondent is a defendant in an action brought by Yvette Kenny, who was Delphis Mallet’s spouse at the time of his death. [10] The applicant claims that there is friction and hostility between the respondent and some of the beneficiaries in this case.Émile Landry, the former interim co-administrator of the estate, confirmed this unfortunate reality in an affidavit dated April 1, 2021, inwhich he stated: [TRANSLATION] “that the bond of trust between the administrators and the estate is utterly broken and I make these assertions having beenpersonally drawn into this situation, which I would describe as an ‘internal family war’.”

[Emphasis mine.] [11] In this case, the situation between the two factions of this family can only be described as hostile and suspicious. I find myselfwith facts very similar to those considered by Walsh, J. in Williams. Given the undeniable animosity as well as conflict of interest, therespondent cannot continue as interim administrator. That being said, it is important to note that I have seen nothing to date to indicatethat there have been any problems with the management of the estate related to the respondent’s actions.

Moreover, the determinationthat it is necessary to remove the respondent from her role as interim administrator is unrelated to the ultimate determination ofDelphis Mallet’s capacity and the validity of the July 2014 will. [12] The second issue to be considered is the respondent’s request to be reimbursed by the estate for legal fees incurred to date. Therespondent explains that she has already personally spent approximately $90,000 on legal bills.

The bills are not just related to her workas co-administrator of the estate of Delphis Mallet but include fees for the challenge to the power of attorney, the accounting ofYvette Kenny as committee and the need to obtain the 1994 will. [13] The applicant opposes the respondent’s claim for payment of legal bills at this point in the litigation. The applicant notes that therespondent seeks full reimbursement for the legal bills paid to date.

The applicant submits that the reimbursement issue should beaddressed after the trial in January, when it will be clear which party has been successful. [14] The applicant cites the Court’s comments in Breau v. The Estate of Ernest St. Onge et al, 2009 NBCA 36 , at paras. 60to 62: 60 Over the last two decades, no less than five appellate courts have confirmed the understanding that, even in estate litigation, thegeneral rule is that costs follow the event.

Correlatively, only in exceptional circumstances will an unsuccessful litigant beentitled to full or partial indemnification out of the estate with respect to legal costs incurred in pursuing an action. Ironically,these two propositions of law are now labelled the “modern approach”. In reality, the modern approach is simply a reversion to theoriginal or traditional rule established pursuant to English precedents. 61 In McDougald Estate v. Gooderham (2005), (ON CA), 199 O.A.C. 203, [2005] O.J.

No. 2432 (QL), the OntarioCourt of Appeal acknowledged that a practice had taken hold in Ontario of awarding costs to unsuccessful estate litigants. Writing forunanimous court, Gillese J.A. states: The practice of the English courts, in estate litigation, is to order the costs of all parties to be paid out of the estate where the litigationarose as a result of the actions of the testator, or those with an interest in the residue of the estate, or where the litigation was reasonablynecessary to ensure the proper administration of the estate. See Mitchell v.

Gard (1863), 3 Sw. & Tr. 275, 164 E.R. 1280 and Spiers v.English, [1907] P. 122. Public policy considerations underlie this approach: it is important that courts give effect to valid wills thatreflect the intention of competent testators. Where the difficulties or ambiguities that give rise to the litigation are caused, in whole or inpart, by the testator, it seems appropriate that the testator, through his or her estate, bear the costs of their resolution.

If there arereasonable grounds upon which to question the execution of the will or the testator’s capacity in making the will, it is again in thepublic interest that such questions be resolved without cost to those questioning the will’s validity. Traditionally, Canadian courts of first instance have followed the approach of the English courts.

While the principle was that costs of allparties were ordered payable out of the estate if the dispute arose from an ambiguity or omission in the testator’s will or other conduct ofthe testator, or there were reasonable grounds upon which to question the will’s validity, such cost awards became virtually automatic. However, the traditional approach has been – in my view, correctly – displaced.

The modern approach to fixing costs in estate litigationis to carefully scrutinize the litigation and, unless the court finds that one or more of the public policy considerations set out aboveapplies, to follow the costs rules that apply in civil litigation. Four cases usefully illustrate this modern approach. [paras. 78–80] 62 Again, note the “modern approach” is nothing more than a reinstatement of the “conventional” costs rule, with its exceptions, asdeveloped under the English common law. More importantly, the Gooderham decision reinstates the general rule that costs follow theevent.

Unless an unsuccessful litigant in Ontario is able to come within the recognized exceptions, the general rule continues to apply.

[Emphasis mine.] [15] The Court still has discretion to award costs even when a litigant has not been successful. This principle is clearly articulated byJustice K.A. Gregory in Re the Estate of Marilyn Carol Hirtle, 2021 NBQB 250 , at para. 18: 18 The bottom line in Breau, however, is that costs in estate litigation are at the principled discretion of the judge hearing thematter: Following the lead of Alberta, British Columbia, Manitoba, Ontario and Prince Edward Island, we believe the general rule that “costsfollow the event” should apply in estate litigation.

Moreover, the general rule envisages costs on a party-and-party basis (partialindemnification). Of course, the general rule is subject to an exceptional category which mirrors and builds upon the policy reasons citedin the jurisprudence. In exceptional cases, the probate court may exercise its discretion to depart from the general rule and awardcosts to an unsuccessful litigant (partial or full).

Of course, the exercise of discretion must be effected on a principled basis and, hence,in accordance with the case law discussed above. [Emphasis mine.] [16] It is difficult to determine without the benefit of witnesses and viva voce evidence which of the two wills of the lateDelphis Mallet is valid. The issue of the validity of the July 2014 will can be determined only once the issue of the testator’s capacity isresolved.

Depending on the evidence adduced at trial, it is certainly possible that the bills paid to date by the respondent will bereimbursed in full, even if the Court does not accept the respondent’s position. The issue of the legal bills should be dealt with at trialafter the Court has considered the evidence necessary to exercise its discretion in a considered way. [17] It is still necessary to appoint an interim administrator of the estate of the late Delphis Mallet pending the Court’s ultimatedecision following the trial in January 2023.

It is not appropriate for just any of the children or beneficiaries of the estate to be appointedgiven the hostility between the family members and the inherent conflict of interest for all of the children vis-à-vis their respectivepositions on the validity of the July 2014 will. [18] Daniel Brassard filed an affidavit with the Court in which he confirmed his willingness to act as an interim administrator. Mr.Brassard has experience in estate administration. Mr. Brassard also confirms that he has no connection with anyone in the family.

Iaccept that while this is far from ideal, in this case it is necessary to appoint an administrator with no connection to the beneficiaries orthe estate. The estate should be administered by an independent party pending a final decision on the validity of the wills. Conclusion and Disposition [19] For all these reasons, the Court orders as follows: (

i) The Order of March 13, 2018, is revoked. (ii) The respondent, Alma Robichaud, is removed from her role as interim administrator of the estate of the late Delphis Mallet effectiveimmediately. (iii) Daniel Brassard is appointed interim administrator of the estate of the late Delphis Mallet effective immediately. (iv) The respondent shall deliver to Daniel Brassard all documents necessary for the administration of the estate by August 5, 2022. (

v) The issue of reimbursement of the respondent’s legal fees will be considered at trial in January 2023. DATED at Moncton, New Brunswick, this 21st day of July 2022.

_______________________________________ Tracey K. DeWare Chief Justice of the Court of Queen’s Bench of New Brunswick