Mandatory Mediation
Whether or not to mediate an estate dispute in Ontario is an easy question to answer if the dispute arises in Toronto, Ottawa, or Essex County (Windsor area). Pursuant to Rule 75.1.02(1)(a) of the Rules of Civil Procedure,[1] estate disputes are subject to mandatory mediation in those areas unless such requirement is waived by the Court.
Mandatory mediations are governed by Rule 75.1 which sets out the procedure, including details of the mediation attendance, confidentiality, and remedies for non-compliance. Rule 75.1.02 (1)(b) provides that mandatory mediation applies to the following disputes:
contested passing of accounts applications;
formal proof of testamentary instruments;
objections to issuing a certificate of appointment of estate trustee;
claims against an estate;
proceedings under Part V of the Succession Law Reform Act;[2]
proceedings under the Substitute Decisions Act;[3]
proceedings under the Absentees Act,[4] the Charities Accounting Act,[5]
the Estates Act,[6] the Trustee Act[7]or the Variation of Trusts Act;[8]applications under Rule 14.05(3) whether the matters at issue relate to an estate or trust; and,
proceedings under s.5(2) of the Family Law Act.[9]
Ontario courts will only dispense with mandatory mediation where there is a clear reason. In the Toronto decision, Sheard Estate 2013 ONSC 7729, the court dismissed a motion for an order dispensing with mandatory mediation in a contested passing of accounts dispute. The beneficiaries of the estate (the grandchildren of the deceased) argued that as their primary complaint was over estate trustee compensation, the “quarrel was not really among family members, and thus is less amenable to mediation”. The beneficiaries also argued that mediation should be dispensed with as the amount in dispute was “small”. Justice Mesbur however, disagreed, noting that:
Mediation is helpful in narrowing issues, focusing cases, and, where possible settling them. Mediation is useful in every kind of litigation before our courts. Its efficacy is not limited to “family relationship” disputes… I hardly view [$100,000.00] as a “small” amount.[10]
The grandchildren also argued that settlement had already been explored and failed. Justice Mesbur also rejected this argument:
Often, parties need an independent, third party to help them see past their respective positions and arrive at a resolution that is in the interests of all, without expending further resources. The parties have not had the benefit of this kind of third-party intervention. It is extremely beneficial. It could resolve this case.[11]
Justice Mesbur concluded that there was no reason for her to exercise her discretion to dispense with mediation.
Importantly, it should be noted that as of January 1, 2016, Rule 75.06(3.1) provides Ontario courts with the power to order parties to a mediation, on their own initiative, and without the consent of the parties, even in jurisdictions where the mandatory mediation rules do not apply. Court-ordered mediations are governed under Rule 75.2.
At the time of writing, there is only one reported decision, Horbaczyyk v Horbacczyk 2017 ONSC 6666, where a Court ordered mediation pursuant to section 75.06(3.1). In that case the challenger of a Will sought relief directing the parties to participate in mediation, however, he failed to request that relief in his motion for directions. Justice Emery made the following comment: “Fortunately, Rule 75.06(3.1) provides that the Court may order that a mediation session take place under Rule 75.2, with power to give the necessary directions. Therefore, this Court makes an order that the parties attend a mediation”. The decision does not mention whether the propounder of the Will consented or objected to participating in a mediation.
When not subject to the mandatory mediation rules, or a mediation order, there are several reasons why the parties may choose to mediate. As with most litigation, but ever more so in estate litigation, the “real” dispute may have nothing to do with the legal issues involved.
Some of the merits in considering mediation of an estate dispute include:
Mediation is strictly a confidential process and subject to settlement privilege;
Privacy, in that in a digital era where court decisions are more public than ever, and accessibility of cases prevalent through online databases, such as CanLII[12] and postings on the internet and social media;
Since there is no winner/loser, everyone involved can control the mediation process and take ownership of the outcome;
Both sides can tell their story and hear the details of the opposing view, which may be therapeutic for all involved;
A mediation is time limited, as opposed to litigation which can be time consuming and can take years to determine;
A mediation will occur in a neutral space with less pressure than a formal courtroom;
Mediation is less expensive than trial;
Mediation may help preserve relationships;
The process is relatively informal and straightforward; and
Mediation can facilitate dialogue.
There is little downside to mediation if you approach it with the right attitude and preparedness. Mediation gives parties a chance to ‘hit the pause button’ and step outside of the litigation especially given the participants are often bereaving the loss of a loved one
When Mediation May Not Be Appropriate
While most estate disputes will benefit from a mediation, a mediation may not be appropriate in some situations. For example, where there is a history of documented physical violence between the parties, having the parties attend a mediation in person may not be appropriate. For cases where there has been sexual harassment, violence and other forms of abuse and power imbalances, mediation may not be a suitable alternative to litigation.
Other situations where mediation may not be suitable for an estate dispute include where parties wish to set a legal precedent, and as such, desire a formal judicial ruling on an existing point of law, or where extraordinary court relief is sought, such as a declaratory judgment.
To deviate from the requirement for mandatory mediation, lawyers will need to seek a court order excusing the parties under Rule 75.1.04.
—
[1] Rules of Civil Procedure, RRO 1990, Reg 194, r 75.1.
[2] Succession Law Reform Act, RSO 1990, c S 26.
[3] Substitute Decisions Act, 1992, SO 1992, c 30.
[4] Absentees Act, RSO 1990, c A 3.
[5] Charities Accounting Act, RSO 1990, c C 10.
[6] Estates Act, RSO 1990, c E 21.
[7] Trustee Act, RSO 1990, c T 23.
[8] Variation of Trusts Act, RSO 1990, c V 1.
[9] Family Law Act, RSO 1990, c F 3.
[10] Sheard Estate, 2013 ONSC 7729 at paras 40-41.
[11] Sheard Estate, 2013 ONSC 7729 at para 43.
[12] www.canlii.org