2022 MBKB 199, 2022 MBKB 199

Date: 20221024 Docket: PR 17-01-07570 (Winnipeg Centre) Indexed as: Estate of Mike Tarabalka Senior Cited as: 2022 MBKB 199 COURT OF KING’S BENCH OF MANITOBA B E T W E E N: IN THE MATTER OF THE ESTATE OF MIKE TARABALKA, Senior, DECEASED ) ) Appearances: ) ) Gavin Wood ) Counsel for the applicant ) ) ) Mike Daniel Tarabalka, Junior and for Mary Barbara San Diego ) ) ) William Tarabalka ) Self-Represented ) ) JUDGMENT DELIVERED: ) October 24, 2022 MASTER GOLDENBERG Background [ 1 ] Mike Tarabalka Senior passed away on December 1, 2016. His wife Dorothy Tarabalka predeceased him on June 30, 2008.

He has three surviving children: Mike Daniel Tarabalka Junior, Mary Barbara San Diego, and William Joseph Tarabalka. For ease of reference in these reasons, I will refer to the children as Mike Jr, Mary and William, and to Mike Tarabalka Senior as their father or Mike Sr. [ 2 ] In June 2017, Mike Jr and Mary brought an application seeking to probate a copy, rather than an original, of the last will and testament of their father, or in the alternative, to compel William to produce a more recent version of the last will and testament of the deceased which he claimed to have in his possession.

They also sought a declaration regarding a further purported handwritten will from 2004. On July 28, 2017, the court ordered William to produce the last will and testament of their father dated January 16, 2004.

On December 12, 2017, probate was granted to William. [ 3 ] In October 2019, Mike Jr and Mary brought an application to revoke the grant of probate issued to William and for an order appointing Mike Jr as administrator of their father’s estate, as well as for an order compelling William to pass accounts for his administration of the estate. [ 4 ] On January 6, 2020, the court ordered that William be removed as executor of the estate and further ordered that Mike Jr be appointed as administrator of his father’s estate with will annexed dated January 4, 2004. [ 5 ] On January 15, 2021, Mike Jr brought the within application to pass his accounts of the estate for the period January 6, 2020, to September 30, 2020.

Preliminary and Procedural Matters [ 6 ] On March 19, 2021, at the first appearance of the passing of accounts before me, it was noted that the order pronounced January 6, 2020, referenced a will dated January 4, 2004. The parties were in agreement that the order contained an error, and that the will that

was properly probated was the will dated January 16, 2004. Accordingly, the passing of accounts was adjourned for the purpose of amending the order to note the proper will. On September 13, 2021, the order was amended to appoint Mike Jr as administrator of his father’s estate with will annexed dated January 16, 2004. [ 7 ] The passing of accounts was rescheduled before me on November 5, 2021. At that time, it was confirmed that William was contesting the passing of accounts as presented by the applicant Mike Jr, and that a contested in person hearing needed to be scheduled.

The contested passing of accounts was adjourned a couple of times as a result of COVID-19 protocols and the inability to have an in person hearing. Ultimately, the contested hearing took place in person on May 30, 2022. [ 8 ] Throughout the appearances on this passing of accounts, William was at all times self-represented and at all times requested that the hearing take place in French and that he be provided with a French interpreter. Translators were present at all appearances before the master, including at the contested passing of accounts; however, at no time did William seek to have any matters translated.

In fact, he made almost all of his oral submissions at the contested hearing in English. [ 9 ] In support of his application to pass accounts, Mike Jr swore an affidavit on December 15, 2020, verifying the application and accounts, as well as a further affidavit on that date providing some additional information in support of the application. A further affidavit verifying the application and accounts was sworn by Mike Jr on January 12, 2021, in order to have the accounts sworn in the appropriate format.

Those three affidavits are court document numbers 26, 27 and 31. [ 10 ] Mary consented to the accounts as presented. A written consent by her dated January 29, 2021, was filed in court. It is court document number 33. [ 11 ] As indicated, William contests the passing of accounts.

In opposition of the passing of accounts, and prior to the second appearance before the master on November 5, 2021, William affirmed five affidavits as follows: • Court Document 35 – affidavit affirmed March 15, 2021 • Court Document 36 – affidavit affirmed March 15, 2021 • Court Document 37 – affidavit affirmed March 17, 2021 • Court Document 38 – affidavit affirmed March 17, 2021 • Court Document 40 – affidavit affirmed March 23, 2021 [ 12 ] At the November 5, 2021, hearing for directions, I gave William leave of the court to file one further affidavit by no later than November 26, 2021, and also gave Mike Jr leave to file a reply affidavit by no later than December 20, 2021.

At that appearance, I also advised the parties that they could give further oral evidence at the contested hearing. [ 13 ] William did affirm one further affidavit which was filed in court on November 25, 2021, as court document 47. At the commencement of the contested hearing on May 30, 2022, William asked that I direct that the matter proceed as an action instead of as an application, and that the parties be compelled to proceed to discovery.

In the alternative, he asked that Mike Jr be compelled to provide written answers to a large number of questions set out in his affidavit evidence and also be compelled to produce various documents in advance of the hearing. [ 14 ] William also submitted that the scope of the present accounting needed to include an accounting by Mike Jr from his time as power of attorney before their father died.

Further, he also said that there is a resulting conflict of interest and that Mike Jr needs to be removed as administrator. [ 15 ] I advised William that the matter was properly dealt with by application, and that the rules of discovery did not apply.

I indicated that I would not be directing Mike Jr to provide written answers to the questions set out in William’s affidavits, but that William could cross-examine Mike Jr and could ask him questions relevant to the passing of accounts. [ 16 ] I also advised William that I was not ordering production of any of the documents he requested as I was not satisfied that they were relevant to the passing of accounts.

The documents he sought production of included a power of attorney from his father granted to Mike Jr, a health care directive, and bank account statements dating back to several years prior to his father’s death. I indicated to the parties that I am only dealing with the accounting of Mike Jr from his court ordered appointment as administrator on January 6, 2020.

There is no application before the court for an accounting for Mike Jr’s time as power of attorney. [ 17 ] Finally, I also indicated that there was no motion before the court asking that Mike Jr be removed and that I would not be considering that issue. [ 18 ] William, Mike Jr and Mary were all present at the contested hearing. Mike Jr was sworn in and gave evidence in support of his application to pass accounts, and was cross-examined by William. William declined to give any oral evidence. Mr. Wood confirmed he was not seeking to cross-examine William on any of his affidavit evidence.

Decision [ 19 ] I am approving the accounts of the personal representative, as follows:

• The assets of the estate that came into the hands of the personal representative as of January 6, 2020, amounted to $0.00. • The assets of the estate that came into the hand of the personal representative after January 6, 2020, amounted to $66,358.82, all of which was in the form of cash. • Other than from the realization of the assets or investments made by the personal representative, no other money was received by the estate after January 6, 2020. • The personal representative properly paid out and disbursed in due course of administration of the estate (otherwise than as distributions to beneficiaries or for the purpose of investing moneys of the estate) the sum of $24,472.78. • The personal representative properly distributed to the beneficiaries of the estate, assets or money of the estate to a total value of $0.00. [ 20 ] In addition to approving those accounts, I also allow as follows: • To the personal representative $900 as fair and reasonable compensation for the care, pains, trouble and time expended in administering and settling the affairs of the estate from January 6, 2020 to September 30, 2020. • To the lawyer for the personal representative $10,000 inclusive of fees and disbursements for preparing the passing of the accounts; half of which shall be paid out of William Tarabalka’s share of the estate. • To William Tarabalka, $500 for reasonable expenses incurred in his administration of the estate. [ 21 ] After deducting the amount of the compensation for the personal representative, half of the fees and disbursements for the lawyer for the personal representative, and the expenses awarded to William Tarabalka, the value of the assets of the estate that remains on hand is $35,486.04 , all in the form of cash. [ 22 ] The remaining half of the legal fees and disbursements of $5000 for the passing of accounts shall be deducted from William Tarabalka’s share of the estate.

Reasons for Decision [ 23 ] At the time he was appointed as administrator of his father’s estate, Mike Jr initially had no access to the estate funds. On January 14, 2020, the estate proceeds in the amount of $63,931.59 previously held at the law firm of Alain Hogue Law were received by Gavin Wood Law. Mr. Hogue was William’s legal representative regarding his administration of his father’s estate. [ 24 ] Mike Jr provided the information he had available to him regarding the sum of money received from Alain Hogue Law. The written accounting of those funds was marked as Exhibit 1.

Mike Jr is not obligated to account for the estate prior to his appointment, and nor has William applied to have his accounts for the period of his administration approved. Nevertheless, the information available regarding the accounts prior to Mike Jr’s appointment was helpful to the court. [ 25 ] The accounting shows moneys received by Alain Hogue Law.

It also shows moneys paid out including two small fees for notices to creditors, as well as for legal fees to Alain Hogue Law in the amount of $5,948.18. [ 26 ] Mike Jr explained that in addition to the $63,931.59 received from William’s legal counsel, that after filing his accounts, he also discovered a CIBC account with approximately $2,500 in it which was the net proceeds from the final tax return. In one of William’s affidavits, he noted that there was $2,427.23 in the CIBC estate account that was missing from Mike Jr’s accounting.

Accordingly, I find that the assets that came into the hands of Mike Jr after he was appointed administrator, totaled $66,358.82 ($63,931.59 + $2,427.23). [ 27 ] I find that there were no other monies received by the estate after Mike Jr was appointed as administrator. [ 28 ] During his administration, Mike Jr caused two disbursements to be made from the estate funds. One was to Gavin Wood Law for legal fees and disbursements in the amount of $10,282.78 with respect to the court application to remove William and appoint Mike Jr as administrator.

In the order appointing Mike Jr, the court ordered that solicitor-client costs for the application be paid by the estate. [ 29 ] The second was to Canada Life in the amount of $14,190 as a result of an overpayment of pension benefits that resulted because Canada Life had not been advised of Mike Sr’s death in a timely manner. [ 30 ] Given that William said he was disputing all aspects of the accounting, Mike Jr gave evidence about the legal fees for the application to remove William as executor as well as with respect to the pension overpayment. Exhibit 2 is Mr.

Wood’s interim account for the earlier application and Exhibit 5 is the same account with a detailed breakdown of Mr. Wood’s time. Exhibit 3 is documentation relating to the pension overpayment. [ 31 ] Having considered the evidence, I find that both of those disbursements were reasonable and appropriate, and I approve both. Solicitor-client costs had been approved by Justice Chartier when he granted his order removing William and appointing Mike Jr. The invoice that was paid totals $10,282.78 and covers Mr. Wood’s time from August 21, 2017, to January 4, 2020.

The amount of legal fees charged was $8500 for a total of 45.5 hours of work. That application was for the removal of William and the appointment of Mike Jr. The time entries do not include time relating to the earlier application to court to compel William to produce the will in his possession. I find the legal fees charged were reasonable and ought to be paid by the estate in accordance with the order of Justice Chartier. [ 32 ] There clearly was an overpayment of a pension benefit that the estate was obligated to refund.

William acknowledged during the course of the hearing that he was not really contesting that disbursement.

[ 33 ] Accordingly, I find that Mike Jr properly paid out and disbursed in due course of administration of the estate the sum of $24,472.78. [ 34 ] No disbursement of the remaining funds was made, including to beneficiaries, given that the passing of accounts was contested by William.

The estate has received a clearance certificate from the Canada Revenue Agency and there is nothing left to administer other than the distribution of the estate to the beneficiaries. [ 35 ] The balance therefore, before any other expenses or compensation approved on this passing of accounts was $41,886.04 ($66,358.82 – $24,472.78) [ 36 ] Mike Jr seeks compensation of $900 from the estate as fair and responsible compensation for the care, pains, trouble and time expended in administering and settling the affairs of the estate from January 6, 2020 to September 30, 2020. [ 37 ] Mike Jr also seeks compensation for the legal fees incurred in passing the accounts, and I will discuss that issue in further detail at the end of these reasons. [ 38 ] William raises a number of concerns with the accounting, none of which I find to have any merit.

He raises concerns with transactions that occurred prior to Mike Jr’s appointment as administrator of the estate. Some of the transactions he refers to relate to the time period before their father’s death when Mike Jr was the Power of Attorney for their father, as well as to some transactions that took place after their father’s death either prior to or after William was granted probate of the estate.

William also raises a number of concerns relating to Mike Jr and Mary’s knowledge about earlier versions of wills, powers of attorney and health care directives. [ 39 ] I find that the concerns raised in William’s affidavits are either not relevant to the passing of accounts before me or do not raise any valid concerns with respect to the administration of the estate by Mike Jr. If William was concerned about any financial matters relating to his father’s estate or even with respect to a power of attorney before his father’s death, he should have taken action on those concerns when he was granted probate in 2017.

He had ample opportunity to do so. [ 40 ] In addition to raising concerns about the validity of the power of attorney and with Mike Jr’s conduct as attorney, neither of which were matters before me or relevant to the accounting, William also sought reimbursement from the estate for various expenses incurred by him as executor. [ 41 ] Some of those expenses are set out in Exhibit 1, being expenses incurred including legal fees for William’s lawyer Mr. Hogue. Neither Mike Jr or Mary take any issues with those expenses.

There is no need for me to approve those per se, as Mike Jr’s accounting is not before me and no one disputes that they were properly paid before the funds were handed over to Mike Jr’s lawyer. [ 42 ] William seeks compensation of $14,344 from the estate as compensation for his services as executor. In addition, he seeks compensation of $44,336.95 for economic duress and a further $30,000 to $35,000 in relation to a 2011 real estate deal.

In his affidavit he refers to certain expenses that he say he paid himself including $194.94 for tax prep, $100 for death and birth certificates, $100 for Victor Olson’s legal fees and $450 for a court transcript. [ 43 ] William seeks compensation of $13,500 for his time in relation to the application to remove him as executor as well as this passing of accounts. [ 44 ] Mike Jr’s administration of the estate has been relatively simple in the sense that when he was appointed by the court, there were estate proceeds already realized.

In the course of his duties, he gave notice to creditors, paid a claim for an overpayment of a pension payment, paid legal fees ordered by the court, and obtained a clearance certificate. I find that all of his actions as administrator were appropriate. [ 45 ] Mike Jr wishes to complete his obligations by distributing the balance of the estate to the beneficiaries in accordance with his father’s testamentary wishes. His administration of the estate has been made complicated only by virtue of it being contested by William.

In addition to needing to prepare for and attend the contested hearing, Mike Jr needed to address excessive and inappropriate communications from William both to Mike Jr and directly to his lawyer, Mr. Wood. [ 46 ] I find that the $900 sought by Mike Jr to compensate him for his time in administering the estate is entirely reasonable and I award that to him. [ 47 ] On the contrary, I find that none of the compensation sought by William for his time is reasonable.

Unfortunately, the court removed William as executor, and it cannot be said that he properly fulfilled his obligations as executor, and I find he is not entitled to any compensation for his time in administering the estate. As noted, the legal fees and disbursements paid to his lawyer in relation to the administration have been paid and are not challenged. Likewise, the expenses covered by his lawyer for giving notice to creditors have been paid and are not challenged. [ 48 ] I am not prepared to award any compensation to William for his time and effort in administrating of the estate.

Nor do I award him compensation for anything like economic duress or in relationship to a real estate deal from 2011. There is no claim by William against the estate for those matters and they are not part of this accounting. [ 49 ] On the other hand, if William personally incurred any reasonable and necessary expenses in the course of his administration, I find he should be compensated for those by the estate. One of his affidavits refers to some expenses that appear reasonable, namely the preparation of the tax return in the amount of $194.94 and birth and death certificate fees in the amount of $100.

There is nothing to suggest that those expenses were paid out of the estate during the course of this administration. I accept that he incurred those expenses and that there may have been some other small expenses that he paid for during the course of his time as administrator. For example, he also refers to legal fees of $100 with another lawyer. I do not, however, accept that the estate should reimburse him for the expense of obtaining transcripts from any of the court proceedings.

[ 50 ] I direct that the estate reimburse William a total of $500 for his reasonable expenses in connection with administering the estate. [ 51 ] The final issue to be determined relates to the legal fees for the passing of accounts and whether those fees should come from the estate generally, or from William’s share. Mike Jr submitted a

summary of Mr. Wood’s time in relation to the passing of accounts. Mr. Wood’s time up to April 20, 2022, was 33.5 hours. That does not include, at a minimum, the day of the hearing, nor does it include any disbursements. [ 52 ] In his submission, Mr.

Wood said that Mike Jr is prepared to accept any amount that I consider appropriate for his legal fees in connection with the passing of accounts, as well as my decision on whether some or all of those fees should come directly from William’s share of the estate given all of the circumstances. [ 53 ] William was strongly opposed to any legal fees being allowed primarily because he is of the view that Mike Jr and/or his lawyer intentionally misled the court when it submitted the order to Chartier, J. with the incorrect will referenced. [ 54 ] On the evidence before me, I have decided to allow $10,000 inclusive of fees, taxes and disbursements for the passing of accounts, half of which shall be paid out of William’s share of the estate.

I find that to be reasonable in the circumstances including that it was necessary to apply to court to have the order appointing Mike Jr amended, and that there were two appearances before the master on the directions as well as the preparation for and attendance at an in person contested hearing.

That takes into consideration that it was not William’s fault that an amendment to the order was necessary, but also that the passing of accounts itself and most of the time associated with it, was not necessary as William raised no valid concerns with what was otherwise a very straight forward administration by Mike Jr. [ 55 ] In my view, Mike Jr and Mary have shared enough of the burden of the legal fees given the previous order that solicitor-client costs be paid by the estate when William was removed as executor.

Based on his unreasonable opposition to the passing of accounts, William should bear more of the responsibility for the costs of this application. [ 56 ] As noted above, based on the accounts presented, the value of the assets of the estate that remains on hand is $35,486.04, all in the form of cash. Mike Jr can now proceed to conclude the administration of the estate by distributing it to the beneficiaries in accordance with the will, and with my direction that $5000 of the legal fees for the passing of accounts is to come directly from William’s share of the estate. _________________________ J. L.

Goldenberg Master