JANICE ORTYNSKI AS POWER OF ATTORNEY FOR IRENE KIRKLAND-BIRD PETITIONER - v. -, 2021 SKQB 245

QUEEN’S BENCH FOR SASKATCHEWAN Citation: 2021 SKQB 245 Date: 2021 09 14 Docket: FLD 366 of 2018 Judicial Centre: Saskatoon BETWEEN: JANICE ORTYNSKI AS POWER OF ATTORNEY FOR IRENE KIRKLAND-BIRD PETITIONER - and - HAROLD GODFREY BIRD, DECEASED AND BMO TRUST COMPANY EXECUTOR OF THE ESTATE OF HAROLD GODFREY BIRD AND LAWRENCE BRUCE BIRD (Administrator ad litem ) RESPONDENT Counsel: Neil McPhee for the petitioner Jessie Buydens for the respondent FIAT BROWN J. September 14, 2021 INTRODUCTION [ 1 ] Irene Kirkland and Harold Bird married in 1992. It was a second marriage for each of them.

They executed a Pre-Marital Agreement just prior to their marriage so as to keep the bulk of their property separate and independent from the other in the event of a claim which the other might mount at some future time [Pre-Nuptial Agreement]. Excluded from this separation of assets was quite specifically their contribution to their condominium property which was dealt with by para. 1(

b) and which provided that the surviving party would pay 50% of the fair market value to the estate of the other party should they predecease. Also noted for different treatment than the pure separation of assets were various appliances and a holiday recreational vehicle. [ 2 ] On July 14, 2014 the parties each obtained independent legal advice and executed a formal revocation of the Pre-Nuptial Agreement. It stated: REVOCATION OF INTERSPOUSAL PRE-NUPTIAL AGREEMENT WHEREAS the parties executed a pre-nuptial agreement dated November 12, 1992 [the “Pre-Nuptial Agreement”].

AND WHEREAS the parties have agreed to revoke the Pre-Nuptial Agreement; AND WHEREAS the parties have voluntarily entered this agreement to revoke the Pre-Nuptial Agreement; [herein called the Agreement”];

NOW THEREFORE, in consideration of the premises and mutual covenants herein contained, Irene and Harold promise and agree with each other as follows: 1.

PREAMBLE 1.1 The parties agree that the clauses making up the

preamble to this agreement are true and form the basis of this Agreement. 2. REVOCATION 2.1 The parties agree to revoke the Pre-Nuptial Agreement, effective immediately upon execution of this Agreement. 2.2 The parties acknowledge and agree that by revoking the Pre-Nuptial Agreement, they shall be treated as spouses under all applicable legislation and common law, and that their property and financial matters shall be governed by same. 3. INDEPENDENT LEGAL ADVICE: 3.1 Irene and Harold each acknowledge that: (

a) they have had independent legal advice regarding this Agreement, (

b) they understand the nature and effect of this contract and their respective rights, obligations and claims under this Agreement, (

c) they are signing this Agreement voluntarily, (

d) they agree that this Agreement is an interspousal contract within the meaning of

Section 38 of The Family Property Act ; and (

e) this Agreement is not grossly unfair or unconscionable. 4. APPLICABLE LAW 4.1 The proper law of this Agreement shall be the law of Saskatchewan and this contract shall also be deemed to be valid and enforceable in accordance with the law of any other jurisdiction. The parties intend all of their affairs and property as between them to be governed by this Agreement and the law of Saskatchewan. 5.

DISPUTE RESOLUTION 5.1 The parties agree that in the event of any disputes arising out of this Agreement they will enter the collaborative law process and/or attempt to mediate a resolution to the dispute or disputes prior to making a court application. 6.

SEVERENCE: 6.1 It is understood and agreed by Irene and Harold that if any part, term or provision of this Agreement is determined by a Court of competent jurisdiction to be unlawful or otherwise unenforceable by reason of conflict with any law applicable to them in the province where made, or where it is sought to be enforced, the validity of the remaining portions or provision shall not be affected. The rights and obligations of Irene and Harold shall be construed as if this Agreement did not contain the particular part, term or provision here to be invalid or unenforceable. 7.

AGREEMENT TO BIND ESTATE: 7.1 Their Agreement shall enure to the benefit of and shall be binding upon Irene and Harold, their respective heirs, executors, administrators and assigns. [ 3 ] In April of 2018, Harold Bird passed away at the age of 91. [ 4 ] On January 25, 2019 Irene’s daughter, Janice Ortynski [Janice], as power of attorney for Irene, petitioned for an unequal division of family property pursuant to The Family Property Act , SS 1997, c F-6.3 [ FPA ] and provision for Irene per The Dependants’ Relief Act, 1996 , SS 1996, c D-25.01 [ DRA ].

She completed a property statement indicating that Irene had $534,000 in assets $512,000 of which was in the form of investment accounts. There were no debts. She declared her income from her last income tax return to be $72,172.63. She showed expenses in the amount of $89,308. However, on her income statement she indicated only $35,786. [ 5 ] Looking back a few years, Irene’s 2015 income was $76,391, her 2016 income was $70,982, and her 2017 income was $72,168 taken from line 150 of her income tax assessments.

While there was a somewhat more significant capital gain in 2015, by 2017 this had dwindled to just $4,630.48. The balance of the $72,172 was received from OAS, CPP, other pension income and dividends. [ 6 ] Harold’s property statement completed in July of 2019 shows assets in the amount of $2,976,352 and debts of $376,684, thus a net value of $2,599,667. Both Harold and Irene claimed substantial pre-marital asset exemptions in the family property proceeding. [ 7 ] A pre-trial was held on April 6, 2021, but settlement was not achieved. It was directed to be set for a ten day trial.

No trial date has been secured by the parties to date. [ 8 ] The property statement filed on behalf of Irene in March of 2021, in anticipation of the pre-trial, showed a net asset value for her of $400,173.65. Her financial statement showed income of only $37,438.82 and expenses are shown as having ballooned to $164,752, which included expenses related to a move to a private care home.

[ 9 ] In this regard, the move was described by Janice Ortynski in her affidavit as follows: “Irene requested to be moved to a newer nursing home with a private room. CPAS assessed her situation and determined that she did not qualify. Rather, Irene was required to move to a private care home carrying significant expense”. This is further described by Janice as costing “$73,406 annually”.

Additional out of pocket medical expenses are indicated by Janice as being $3,225.58. [ 10 ] Comparing the sources of Irene’s income over the relevant time period, being prior to Harold’s death and after, the primary difference was Irene was no longer receiving “Elected Split Pension Amount” at line 116. This appeared to be a change which took place for the first time in 2018 and was a loss of income from 2017 of $36,386.96.

Irene therefore shows this dramatic drop in the amount she received from that source from 2017 to 2018. [ 11 ] Janice sets out the overall decline in Irene’s financial situation at Exhibit H to her affidavit of July 16, 2021 and says the net expenditure over the period measured is $108,238.73, bringing her net property down to $405,216.89. This amount is essentially all in liquid investments but for $1,000 worth of household goods.

Discussion [ 12 ] Irene applies for an interim family property distribution in the amount of $300,000 and an interim DRA payment of $5,000 per month. [ 13 ] Harold’s administrator ad litem , his son Lawrence, applies to amend the Answer to respond to his concerns that the revocation of the Pre-Nuptial Agreement has been put in question through discovery of documents which suggest a different intention was held by Harold and/or there may have been a conflict of interest on behalf of the BMO agent who sent Harold and Irene to obtain legal advice regarding the Pre-Nuptial Agreement.

Amendment to Answer [ 14 ] The administrator applies to amend the Answer pursuant to Rule 3-72 of The Queen’s Bench Rules . The portions of that Rule relevant to the circumstances of this case read as follows: 3-72

(1) A party may amend the party's pleading, including an amendment to add, remove, substitute or correct the name of a party, as follows: . . . (

c) after a statement of defence is filed: (

i) by agreement of the parties filed with the Court; or (ii) with the Court's prior permission, in any manner and on any terms that the Court considers just. . . .

(3) Parties shall make all amendments to their pleadings that are necessary to determine the real questions in issue between the parties. [ 15 ] The claim advanced here is set out in the draft amendments as follows: In reply to para 21, the respondent denies that there was a total revocation of the 1992 Prenuptial Agreement.

The revocation document does not align with the written instructions to the solicitors provided by the parties and their financial advisors. [ 16 ] The documents which suggest to the administrator that the revocation was not in accordance with the intent of Harold and Irene consist of handwritten notes of Harold’s which state: July 5: “Charmain Panko called today. Long discussion about $75,000 in will. To be in a new agreement if necessary somewhat like a pre-nuptual – called differently. Meet at 12:00 instead of [. . .] on July 14”. . . . July 14: “Meet at law office at 1:00 to sign Wills Thomson Miller Heather.

Now at 12:00 to meet Charmain Panko regarding $75,000 clause + a new agreement”. [ 17 ] In addition, the context advanced regarding this is that there was manifested a joint intention that each of Irene and Harold wanted to keep their assets separate and have their respective estates go to their children, not each other. Their wills were accordingly structured in that way both before and after the revocation. Harold has children, one of whom has significant mental health issues and is most likely dependant on Harold for his maintenance.

The couple’s resources were never mingled and joint purchases were both carefully discussed and documented. [ 18 ] In addition, the context advanced to establish that the amendment is not frivolous or purely speculative is that BMO retained counsel for both Irene and Harold, and this placed them in a conflict of interest.

While that seems like an unlikely scenario as well, it is part of the milieu. [ 19 ] In Boisvert v Milton No. 292 (Rural Municipality), 2015 SKQB 2 at para 8 , 464 Sask R 28, the law was summarized with respect to an application to amend a pleading under Rule 3-72: [8] Existing case law has established that the following principles apply to applications to amend pleadings:

i.) Leave to amend is a discretionary remedy, but the practice is to allow amendments where it is necessary to determine the issues between the parties and it can be done without injustice to the other side; ii.) There is no injustice to the other side if it can be compensated in costs; iii.) The court's discretion is wide and should be exercised so as to ensure the real issues are dealt with as expeditiously and inexpensively as possible; and iv.) If the amendments are opposed, the court must consider the proposed amendments as if the opposing party had applied to strike the pleadings under Rule 7-9(2). [ 20 ] As recognized by Justice Bardai in Kidd v Kidd, 2020 SKQB 249 , Rule 3-72(3) makes amendments to pleadings mandatory in that it states that the parties shall make all amendments to their pleadings that are necessary to determine the real questions in issue between the parties. [ 21 ] Justice Kalmakoff (as he then was) in Qaisar v SGI Canada, 2019 SKQB 68 described the parameters engaged with the final point of analysis,

Part IV, thus: 60 Generally, the court will permit amendments to cure defects in the pleadings, unless the amendments could be struck pursuant to Rule 7-9(2): 628356 Saskatchewan Ltd. v Water Security Agency , 2018 SKQB 4 , 78 CLR (4th) 53; Rekken v Saskatchewan (Health Region #1); 2015 SKCA 36 , 384 DLR (4th) 174. In Boisvert v Milton (Rural Municipality No. 292) , 2015 SKQB 2 , 464 Sask R 28 [ Boisvert ]… 61 In this case, SGI Canada opposes the proposed amendments, so I must consider them in light of Rule 7-9. It reads as follows: 7-9

(1) If the circumstances warrant and one or more conditions pursuant to subrule (2) apply, the Court may order one or more of the following: (

a) that all or any part of a pleading or other document be struck out; (

b) that a pleading or other document be amended or set aside; (

c) that a judgment or an order be entered; (

d) that the proceeding be stayed or dismissed.

(2) The conditions for an order pursuant to subrule (1) are that the pleading or other document: (

a) discloses no reasonable claim or defence, as the case may be; (

b) is scandalous, frivolous or vexatious; (

c) is immaterial, redundant or unnecessarily lengthy; (

d) may prejudice or delay the fair trial or hearing of the proceeding; or (

e) is otherwise an abuse of process of the Court.

(3) No evidence is admissible on an application pursuant to clause (2)(a). 62 Where the issue is whether a proposed amendment discloses a reasonable claim or defence, applying the principles summarized in Boisvert does not call for a deep inquiry into the merits of the claim or defence being pled. The perceived strength or weakness of the proposed pleading is not relevant at this stage. It is only if the proposed claim or defence is clearly bad in law that the amendment should be found wanting: Granitewest Developments Ltd. v Saskatchewan (Minister of Highways and Infrastructure) , 2015 SKQB 320 at para 41 .

If an amendment to pleadings is necessary to determine the real issues between the parties, does not create prejudice that costs are incapable of remedying, and does not otherwise offend Rule 7-9(2), it should be permitted. 63 When "reasonable claim or defence" is the issue, the court should be generous in its approach, and err on the side of permitting novel, but arguable claims to proceed to trial. The test for striking a claim under this ground is a stringent one.

A claim should be struck for failing to disclose a reasonable claim only in plain and obvious cases, where the matter is beyond doubt, i.e . where, assuming the plaintiff proves everything alleged in the claim, there is no reasonable chance of success: Collins v Saskatchewan Rural Legal Aid Commission , 2002 SKQB 201 [ Collins ]; Saskatchewan Power Corporation v Swift Current (City) , 2007 SKCA 27 , [2007] 5 WWR 387.

The court must also proceed on the basis that the facts pled are true, unless they are manifestly incapable of being proven: R v Imperial Tobacco Canada Ltd , 2011 SCC 42 , [2011] 3 SCR 45; Filson v Canada (Attorney General ), 2015 SKCA 80 , 465 Sask R 6.

In Venture Construction Inc. v Saskatchewan (Ministry of Highways and Infrastructure) , 2015 SKQB 70 , at para 11 , 470 Sask R 7, Justice Barrington-Foote (as he then was) noted that the threshold for a claim to survive is low, and it should not be struck unless it is hopeless, or contains a radical defect. 64 Where the issue is solely whether a proposed amendment discloses a reasonable claim, the court making the determination whether to permit the amendment may consider only the claim itself, as a whole, and determine whether it properly pleads the essential elements of the cause of action: Collins; Reisinger v J.C.

Akin Architect Ltd. , 2017 SKCA 11 , 411 DLR (4th) 687 [ Reisinger ]. 65 Rule 7-9(2), though, permits pleadings to be struck for reasons other than failing to disclose a reasonable claim. 66 Claims that are scandalous, frivolous, or vexatious may be struck under subrule (b), and subrule (

e) permits striking out claims that

are otherwise an abuse of the court's process. Where the proposed amendment is opposed on the ground that it is scandalous, frivolous,vexatious, or an abuse of process of the court, a different analysis is permitted. In such circumstances, the court is entitled to considerevidence other than the pleadings: Bank of Montreal v Giesbrecht, 2005 SKQB 18; C & J Hauling Ltd. v Mistik Management Ltd., 2010SKQB 60at para 17, 351 Sask R 199 [Mistik]. The court may undertake an assessment of the merits of the claim and the motives of theplaintiff in bringing it: Reisinger, at para 18.

If, in all the circumstances, it is obvious that the claim is devoid of all merit, or cannotsucceed, it should be struck. This jurisdiction should be exercised sparingly, and only in exceptional cases: Sagon [Sagon v Royal Bankof Canada (1992), (SK CA), 105 Sask R 133 (CA)], at para 18; Rubbert v Boxrud, 2014 SKQB 221at para 37, 450Sask R 147 [Rubbert]. 67 Subrule 7-9(2)(

e) is a codification of the court's inherent power to prevent abuses of its process. As I stated earlier, "abuse of process"is a term of great significance. It connotes that the process of the court must be carried out properly, honestly and in good faith. It meansthe court can, and in fact must prevent its machinery from being used as a means of vexation or oppression in the course oflitigation: Sagon. 68 There is overlap between subrules (

b) and (

e) of Rule 7-9(2): Mistik, at para 16. Scandalous, frivolous and vexatious actions areproperly seen as an abuse of the process of the court: Ross v Eastbourne Investments Ltd. (1994), (SK KB), 124 SaskR 97 (Sask QB). Vexatious litigation is virtually synonymous with abuse of process: Re Lymer, 2014 ABQB 696, 601 AR 165. 69 False allegations are scandalous: Miller v Saskatoon (City), 2015 SKQB 234, 483 Sask R 257 as are pleadings that improperly cast aparty in a derogatory light. A claim that is groundless, without substance, or not pursued for a proper purpose is frivolous: Mistik;Harper v Bennett, 2015 SKQB 314.

Actions pursued for motives other than enforcing a true legal claim, those pursued maliciously andwithout probable cause, or those lacking in justification and brought merely to embarrass the defendant, are vexatious: Tamarak EnergyInc. v IPSCO Inc., 1999 SKQB 125,185 Sask R 161; Saskatoon & Region Home Builders' Association Inc. v The Children's WishFoundation of Canada, 2014 SKQB 89, 440 Sask R 300; Marciano v Landa, 2005 SKQB 58, 1 BLR (4th) 281. 70 Proceedings which are manifestly groundless or without foundation, or which serve no useful purpose, are an abuse ofprocess: Boehringer Ingelheim (Canada) Ltd. v Englund, 2007 SKCA 62at para 41, 299 Sask R 298. 71 Proper application of Rule 7-9(2)(

b) and (

e) permits the court to consider the grounds "scandalous", "frivolous", "vexatious" and"abuse of process" either separately or in conjunction with each other, bearing in mind the degree to which overlap between such groundsexists. These terms must be interpreted and applied in a manner consistent with the purpose and intention of the foundationalRules: Rubbert, at para 43.

They must also be interpreted in light of the purposes of Rule 7-9, one of which is to save the court and theparties the time, cost and inconvenience of dealing with seriously defective or unmeritorious claims: Reisinger, at para 38. [22] The potential for the administrator to establish that the revocation is not as it appears on its face, givenindependent legal advice was provided, this was fully documented and there is no suggestion either Harold or Irene were not fullycompetent, is admittedly rather thin. However, it is not so unlikely as to meet the threshold at play.

I am not to weigh the evidenceadvanced such that it is pre-adjudicated at this stage rather than at trial. It is not merely an allegation made up out of whole clothintended to stymie the proceedings or introduce delay.

The circumstances put forth do indicate that there was consideration of anotheragreement which addressed some aspects of the relationship in its separate financial tracks, as it had been for many years. [23] Thus, while it appears somewhat unlikely on the facts known at this time that the administrator will be able tonavigate around the wording of the revocation in all the circumstances, I cannot find that the allegations in the proposed amendmentdiscloses no reasonable claim, or is scandalous, frivolous or vexatious. The amendment proposed is not immaterial nor redundant orunnecessarily lengthy.

The proposed amendment is not an abuse of process of the court nor is it manifestly doomed to fail when the testwhich is appropriate is applied. [24] In relation to whether the amendment may prejudice or delay the fair trial or hearing of the proceeding, I do notfind this simple amendment will do that. I do not see this issue consuming “days” worth of trial time as argued by Irene. It may extendthe trial by a few hours, perhaps as much as one day. Any prejudice the amendment may visit upon the petitioner can be compensatedfor via a costs award.

Costs awards can be quite nuanced pursuant to the Rules and can readily take into account such situations. Thiswould not be dissimilar to the case in Rafan v Rauf, 2021 SKQB 117. [25] The draft amendment is therefore ordered to be made to the Answer as set out in the draft filed. DRA and Interim Family Property Division Family Property Division [26]

Section 3 of the DRA states: 3 Where a person dies leaving a dependant or dependants, any dependant or person acting on behalf of a dependant may apply to thecourt for an order to provide reasonable maintenance for the dependant. [27]

Section 8 is key in terms of what the court should direct its mind to regarding ordering interim maintenance: 8(1) In determining whether, and in what way, and from what date, maintenance ought to be provided, the court shall consider the natureof the property representing the deceased's estate and shall not make an order requiring a sale of property that would be improvidenthaving regard to the interests of the dependants and of the person who, apart from the order, would be entitled to that property.

(2) In making an order for maintenance, the court shall consider: (

a) any past, present or future capital or income from any source of the dependant;

(

b) the conduct of that dependant in relation to the deceased; (

c) the claims that any other dependant of the deceased may have; and (

d) any other matters that the court considers appropriate.

(3) In making an order for maintenance, the court shall consider the deceased's reasons, so far as they are ascertainable, for making thedispositions made by will, or for not making any provision or any further provision, as the case may be, for a dependant.

(4) When considering the deceased's reasons, the court may accept any evidence of those reasons that it considers appropriate, includinga written statement that is signed and dated by the testator.

(5) In estimating the weight, if any, to be attached to any statement mentioned in subsection (4), the court shall consider all thecircumstances from which any inference can reasonably be drawn as to the accuracy or validity of the statement.

(6) The court may refuse to make an order in favour of a dependant whose character or conduct is or has been of a nature that would, inthe opinion of the court, disentitle the dependant to the benefit of an order. [28] Of importance here is the fact that this is an interim application brought after the parties have alreadyproceeded through pre-trial, which concluded some four months ago. Thus, the setting of trial dates has been in their hands for sometime already. It is likely a date can be selected which is in the range of six months away. [29] Reference to taking into consideration “any past, present or future capital or income from any source of thedependant” in s. 2(

a) of the DRA is also particularly appropriate here. Irene has access to over $400,000 of her own money. Without evenquestioning the level of payments she has decided to take on by moving into a private care arrangement, there are three years of livingexpenses she can cover without any interim award. In argument her counsel submitted that she is not doing well from a healthperspective and may not survive to the trial. This, if correct, is very unfortunate, but if factual, also confirms that moving quickly to trialis imperative and that an interim order is not indicated in the short term.

That may change if the trial does not proceed in a timely mannerand I will recognize that in the form of order made herein. [30] Irene has both capital and income from that capital at present. The parties should be mere months from trial. Atthis time, in these circumstances, I do not find that an award of maintenance is warranted. This conclusion is not in any way to be bindingupon or prejudice the issue being fully considered at trial.

This is purely an interim determination made in the specific circumstances ofthis litigation. [31] The application for interim maintenance is therefore dismissed without prejudice to the matter returning tochambers should unexpected and unforeseen delays result in moving the proceeding to trial and such delays lead to Irene’s assets beingreduced substantially. Irene must have the capacity to carry on her living and medical expenses and her legal fees and if those two thingsare jeopardized a further interim application may be both warranted and necessary. Interim Property Distribution [32]

Section 26 of the FPA provides authority to distribute family property on an interim basis.

The criteria for such adistribution has been the subject of comment in cases beginning with: Conley v Conley (1985), (SK KB), 44 Sask R76 (Sask QB) [Conley], and continuing in Waldherr v Waldherr (1992), (SK KB), 106 Sask R 140 (Sask QB)[Waldherr]; Kotrla v Mryglod (1998), (SK KB), 173 Sask R 287 (Sask QB); Thair v Thair, 2004 SKQB 343; Yung v Yung, 2006 SKQB 388, 284 Sask R 10; Geransky v Geransky, 2012 SKQB 218; and Kolitsas v Rathod, 2017 SKQB 245, 98 RFL (7th)290, among others. [33] Certain criteria were first enumerated in Conley.

As indicated in Waldherr at para 8, the criteria identified inConley are not exhaustive, nor must all such factors be present before ordering an interim distribution. However, missing in this scenarioinvolving these parties are several key indicia from that list: 1. Almost all of the assets were not “acquired by the parties during the course of the marriage”. Sizeable exemptions have beenclaimed by both parties here due to ownership of most of the assets prior to the marriage; 2. It will not be some considerable period of time before this matter can be brought to trial.

As noted earlier, that can occur forthwith; 3. Harold does not have “virtually exclusive control of the matrimonial liquid assets”. Irene has in excess of $400,000 herself; and 4. The applicant is not in need of funds to meet capital demands at this time. As noted, should the trial not proceed and this changes,application can be made once more for an interim distribution. [34] Therefore, the application for an interim family property distribution is dismissed.

This is also without prejudiceto return such application to chambers on 14 days’ notice should there be inordinate delay in moving the matter to trial and Irene’s assetstherefore dwindle and cease to be likely to support her and provide for advancement of this action. ORDER [35] As a result of the above, the court makes the following interim order: 1. The amendment to the Answer is permitted as submitted; 2. The applications for DRA and FPA orders are dismissed without prejudice to renewing them on 14 days’ notice should trial not be

set or proceed in a reasonable period of time and Irene finds her resources dwindling significantly; and 3. Costs shall be costs in the cause. J. D.J. BROWN