Canadian court confirms limitation period for trust claims on estates with real property
Trust claims in the province of Ontario are typically subject to a two-year limitation period following the death of the testator, under the Trustee Act. However, the Superior Court of Ontario decision in Wilkinson v The Estate of Linda Robinson, (2020 ONSC 91) held that the ten-year limitation period under Real Property Limitations Act applied to equitable trust claims against estates.
The Court of Appeal has now settled this question in Ingram v Kulynych Estate (2024 ONCA 678). Henry Kulynych’s (the testator’s) common-law partner Kathleen Ingram (the respondent) claimed that she was entitled to receive one-third of the total value of his estate to recover costs she had spent on his care. She refused a lower settlement proposal.
Four years after the testator’s death, the respondent brought an application for dependent’s support under the Succession Law Reform Act, as well as an equitable trust claim for a share of the estate, including the house. She alleged that the estate had been unjustly enriched by the benefits she provided to the testator during his lifetime.
Cherise Charron, the testator’s daughter and estate trustee (the appellant), brought a motion seeking to dismiss the claim on the grounds that it was limitation-barred. The motion judge followed the decision in Wilkinson, agreeing with that ruling that the ten-year limitation period should apply.
The appellant brought the case to the Court of Appeal. She argued that if the respondent were to have a legitimate equitable trust claim, the substance of it would fall under the Trustee Act.
The Court of Appeal accordingly considered the legislative history and purpose of the two-year limitation period, noting that it allows “access to a remedy available for a limited time without creating indefinite fiscal vulnerability for an estate.” Further, it commented that the discoverability principle cannot be used to extend the limitation period under section 38 of the Trustee Act.
Importantly, the court focused on the fact that shorter limitation periods in estate litigation “reflect the long-established duty of estate trustees to administer estates promptly and diligently…as the expeditious administration of estates is in the interests of justice.”
Considering if the respondent’s claim fell under the Trustee Act, the court found that the claim for unjust enrichment fell within s.38 of the Act. Moreover, it observed that the Act’s provisions were more specific than those of the Real Property Limitations Act and were therefore intended to apply to equitable trust claims against estates.
“Interpreting s.4 of the [Real Property Limitations Act] to include equitable trust claims against estates ignores the language, legislative history, purpose, and judicial treatment of s.38 of the Trustee Act,” the court said. “It also requires the inclusion of language that the legislature did not intend. Moreover, this interpretation would be inconsistent with the overarching interests of justice that estates be efficiently and quickly administered.”
Accordingly, the Court of Appeal ruled that the two-year limitation period prescribed by the Trustee Act should apply to the respondent’s claims.
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