The Ontario Court of Appeal’s ruling in Ingram v. Kulynych Estate, 2024 ONCA 678, released on Sept. 12, is the result of a dispute about the estate of the late Henry Kulynych. His will had left everything to his three children and nothing for Kathleen Ingram, who said she had been in a common-law relationship with Kulynych from 1999 to his death in 2017 and had supported him financially and emotionally. The estate was valued at just under $700,000, with the major asset being a house in Ajax, Ont., which was ultimately sold for approximately $475,000.
In March 2018, Ingram sent a letter to Kulynych’s estate trustee saying she was entitled to one-third of the estate, but it was not until March 2021 — more than four years after Kulynych’s death — that she brought an application for dependant’s support under Ontario’s Succession Law Reform Act, as well as an equitable trust claim for a share of the estate. She argued the estate trustee was personally liable for having distributed the estate despite her claims, with the motion judge in the case classifying the equitable trust claim as one for a “remedial constructive trust over the estate property,” which “hinges on her allegation that the estate has been unjustly enriched by the benefits she says she provided for Mr. Kulynych during his lifetime.”
The Kulynych estate brought a motion arguing the action was statute-barred under the two-year limitation period for claims against an estate under s. 38(3) of the Trustee Act. But the motion judge dismissed that application, ruling the 10-year limitation period for claims in relation to an interest in property under s. 4 of the Real Property Limitations Act applied in the case.
But the Ontario Court of Appeal has now overturned that ruling, finding the two-year limitation period under the Trustee Act applied. Justice Lois Roberts, who authored the unanimous ruling, wrote that unjust enrichment is appropriately construed as a “wrong” falling under s. 38(2) of the Trustee Act, and the “elements of unjust enrichment are a benefit, a corresponding deprivation and the absence of juristic reason for the benefit and the loss.”
“At the heart of the doctrine of unjust enrichment lies the notion of restoring a benefit which justice does not permit one to retain,” she wrote. “Put another way, unjust enrichment may be defined as the unjust retention of a benefit to the loss of another, or the retention of money or property of another, against the fundamental principles of justice or equity and good conscience. The plain meaning of ‘unjust,’ ‘inequitable’ or ‘unconscionable’ connotes a ‘wrong’ for the purposes of s. 38(2) of the Trustee Act.”
Ingram’s claim for unjust enrichment falls neatly within s. 38(2) of the Trustee Act, Justice Roberts wrote.
“[Ingram] asserts that during their relationship, Mr. Kulynych financially benefited at her expense by living rent-free in her house, while renting out his own house and retaining the rental income for himself. She alleges that Mr. Kulynych’s financial benefit at her expense amounts to an unjust enrichment in respect of which she seeks the imposition of a constructive trust over the entirety of the estate’s assets,” she wrote. “In other words, the respondent claims that she has been wronged by Mr. Kulynych’s unjust enrichment (i.e., ‘at her expense’), which she seeks to have remedied by way of a constructive trust or a resulting trust.”
It would have been a simple thing for the legislature to include equitable trust claims against an estate as an exception to s. 38 of the Trustee Act, Justice Roberts wrote — but it did not do so.
“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. It also requires the inclusion of language that the legislature did not intend,” she wrote. “Moreover, this interpretation would be inconsistent with the overarching interests of justice that estates be efficiently and quickly administered.”
As a result of her findings, Justice Roberts dismissed Ingram’s action as being statute-barred. She was joined by Justices Bradley Miller and Sally Gomery in her ruling (Ingram v. Kulynych Estate, 2024 ONCA 678).
David Freedman, an associate professor at Queen’s University School of Law who teaches trusts, wills and estates and estate litigation, said there is a preference in the law to have estates administered within a short period.
David Freedman, Queen’s University School of Law
But Freedman said the interesting part of the case has nothing to do with estates law but, rather, the court’s analysis of the kind of claim that is being brought.
“This is part of a larger set of developments across the common law world to deal with unjust enrichment,” he said. “And the problem with the court’s reasoning is that the characterization of unjust enrichment as being a wrong — which I think it is — is open to criticism.”
Freedman said that “one would think” the best thing to do is to amend the Trustee Act to clarify the limitation periods for claims against an estate.
“It would probably make the most sense for the government to adopt the approach that's taken by the Court of Appeal in this case, because it is a very practical way forward,” he said.
Counsel for Ingram declined to comment for this article. Counsel for the Kulynych estate did not respond to a request for comment.
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