SCHARRER ESTATE (RE)

The Applicant applied for advice and direction regarding the administration of his late mother’s estate and a related trust established for the benefit of his dependent adult sister, Ingrid. Among various relief, the Applicant sought direction on whether a condominium formed part of the estate or the trust, as well as issues in relation to the adequacy of the trust, trustee matters, and costs. The Respondent opposed the Application and cross-applied to strike portions of the Applicant’s Affidavit for being subject to settlement privilege.

Justice Johnston considered whether certain paragraphs in the Applicant’s Affidavit should be struck pursuant to Rule 3.68(4) on the basis that they contained privileged communications exchanged in the course of settlement. The paragraphs referred to a meeting that occurred between the Applicant, the Respondent, and their respective counsel. The Respondent deposed that the meeting was for settlement discussions on the condominium issue, while the Applicant deposed that the purpose of the meeting was to address the agenda sent by the Respondent, which listed issues that were to be discussed in order for the Respondent to fulfill his responsibilities as the Limited Trustee of Ingrid.

Johnston J. emphasized that settlement privilege applied where a dispute existed or was contemplated, there was express or implied intention when making the communication that it not be disclosed, and the communication was made for the purpose of attempting settlement. The Court noted that there needs to be an element of some negotiation or compromise, even where a dispute exists, and that the party asserting the privilege has the onus of establishing those elements.

Johnston J. found that there was a dispute between the parties in relation to whether the condominium formed part of the trust, but that the Respondent failed to demonstrate that the communications at issue were made with the intention of being without prejudice or for the purpose of settlement. The email sent by the Respondent with the agenda for the meeting had no mention of settlement or “without prejudice” discussions. Justice Johnston agreed with the Applicant’s argument that the purpose of the meeting was to address issues to allow the Respondent to fulfill his Limited Trustee responsibilities, which was made clear in his email. Despite counsel being present at the meeting, Johnston J. found that the meeting was not a settlement meeting. The Cross-Application to strike portions of the Applicant’s Affidavit was dismissed.