In a recent decision, a court refused to grant a son’s request for the extension of a timeline to purchase his deceased mother’s home. The son claimed that the COVID-19 pandemic had prevented him from taking the necessary steps for the purchase.
What Happened?
A mother to two daughters and one son died on December 27, 2018. The three children were named jointly as estate trustees in her will.
The mother owned a house in Ontario; it was the one asset of significant value in the estate. The house had a fair market value of around $900,000.
The son and his family had been living in the house since 2012.
Following the mother’s death, the daughters brought an application to court on behalf of the estate to sell the house.
On February 6, 2020, a judge made an order, on consent, that the house would be listed for sale on April 15, 2020 under terms agreed upon by the parties. The order also contained an option for the son to purchase the house no later than close of business on April 14, 2020.
The son subsequently brought a motion to extend the timelines to exercise his option. He based his request on intervening circumstances he attributed to the COVID-19 pandemic. He claimed that the pandemic had prevented him from obtaining a property valuation and from pursuing other necessary financial steps due to bank and governmental closures. The son argued that those circumstances had precluded his ability to purchase the house by the court-prescribed deadline. Finally, the son argued that the timelines in the original court order would cause him enormous prejudice by forcing the sale of the house before COVID-19-related restrictions were lifted and that listing the house for sale would force him to abandon the only home he had known since 2012.
The daughters brought a cross-motion for directions to proceed with listing the house for sale and other relief by varying the original court order to administer the estate, and to move the litigation forward. They provided evidence that the son and members of his own family had lived in the house rent free for over seven years, and that they had allowed it to fall into disrepair. The daughters also stated that the son had paid nothing towards the expenses for the house when their mother was alive, and that the municipal taxes for the house were in arrears.
Decision
The court stated that a moving party seeking such an extension must demonstrate that an order to vary the timeline would be in the interest of justice, and would not cause undue prejudice to the opposite parties. Therefore, the onus fell upon the son.
In response to the son’s arguments relating to the COVID-19 pandemic, the court stated:
“Although I can take judicial notice that government offices have been closed and banks have not been fully operational over the last eight to ten weeks, I can also take judicial notice that many officials in the public and the private sectors, including those in municipal government and in financial institutions, have been working remotely and transacting business. [The son] provided no evidence of contacting these service providers by telephone or email, let alone that he encountered resistance at obtaining information or approvals. The absence of any evidence that [the son] attempted to meet the timelines in the [original court] order by electronic means is a flaw I cannot overlook. In the modern world, even when in the grip of a terrible coronavirus, people sheltering in place can access information, services and products online. […]
There was no expert evidence filed about the effect of COVID-19 related factors on the housing market. Even if the pandemic has deflated market prices, that downward trend would not have impeded [the son]’s efforts to secure financing and to make an offer to the estate. Very likely, lower housing prices would have allowed [the son] to make a lower offer on April 14 than he would have made two months earlier. This does not help [the son] because he never made an offer at all.”
Additionally, the court was not persuaded by the son’s argument relating to his concern about having to find new accommodations for himself and his family; the court found that the son had not provided any evidence to support that concern.
As a result, the court found that the son had not provided enough evidence to support his request for an extension of time. Instead, the court found that the son had taken a position that served his own interest over those of the estate and the other beneficiaries.
The court therefore dismissed the son’s motion to extend the timelines set out in the original court order.
Additionally, the court granted the daughter’s cross-motion to list and sell the house without the son’s involvement as an estate trustee, stating:
“Even if the house is listed for sale, there is nothing to stop [the son] from making an offer to purchase the house through the listing agent like any other prospective buyer. That may also work to his advantage if the COVID-19 environment has deflated prices in the real estate market, as he will be competing with other purchasers on the open market to make offers for the house at current fair market value.”
Finally, the court granted the daughters’ request for the son to pay occupational rent in the amount of $2,000 per month while he continued to live in the house.
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