Executive Summary: Key Legal and Evidentiary Issues

• Raymond C. Mootrey personally guaranteed a business line of credit extended by TD to his company, Ingredient Supply Co. Inc., and that liability passed to his estate upon his death.
• Central to the appeal was whether Renee Lynn Mootrey was properly found to be the Estate Trustee of her late father's estate.
• On the day Raymond died, Renee registered a Power of Attorney on title to two of his properties and transferred both into her name, raising questions about estate administration and potential intermeddling.
• The doctrine of executor de son tort was applied, as Renee's conduct — including contacting TD about Raymond's death and her knowledge of his financial affairs — supported the finding that she assumed the role of Estate Trustee.
• Ownership of the two transferred properties was left unresolved, with the court noting the issue may arise if TD seeks to enforce its judgment against the estate.
• All three grounds of appeal — misapprehension of evidence, the estate trustee finding, and property ownership — were dismissed by the Divisional Court.

Facts of the case

On February 24, 1999, TD Bank granted a line of credit to Ingredient Supply Co. Inc. (the "Company"), with a limit of $48,000. Raymond C. Mootrey and his wife, Molly, each executed personal guarantees for the line of credit. TD advanced the funds, but the Company eventually fell into arrears and defaulted. TD commenced an action in the Superior Court of Justice on February 7, 2023, against the Company and both guarantors. By that time, however, Raymond had already passed away on April 8, 2022. TD therefore brought the action against Renee Lynn Mootrey — Raymond's daughter — in her capacity as Estate Trustee of his estate.

On the day of Raymond's death, Renee registered a Power of Attorney on title to two of his properties: 189 Bechtel Drive, Kitchener, Ontario (the "Bechtel Property") and 301 Alexandra Avenue, Point Edward, Ontario (the "Point Edward Property"). On that same day, title to both properties was transferred into Renee's name. Renee represented herself throughout the proceedings.

Guarantee and liability

The contractual foundation of TD's claim was the personal guarantee executed by Raymond. The motion judge found that Raymond had personally guaranteed the indebtedness of the Company and that, at the time of his death, he remained liable for that indebtedness. That liability passed to his estate. The Divisional Court found no palpable or overriding error in this finding, noting the evidence left absolutely no question that Raymond had guaranteed the Company's debt.

Court's reasoning and analysis

The Divisional Court addressed each of the three grounds of appeal raised by Renee. On the first ground — misapprehension of evidence — the court found no error. Although the preamble of the motion judge's reasons did not expressly reference Renee's affidavit, the judge had in fact confirmed during the hearing that her materials had been uploaded and read, and had commended her for the thoroughness of her filings. The court noted that a judge is not required to address every piece of evidence filed, and that Renee's disagreement with the factual findings did not establish a palpable and overriding error.

On the second ground — whether Renee was properly found to be the Estate Trustee — the court applied the doctrine of executor de son tort. A trustee de son tort is a person who, without formal appointment, takes it upon themselves to act as trustee by possessing and administering trust property. The court found ample evidence supporting this characterization: Renee had detailed knowledge of Raymond's financial affairs and properties, had contacted TD in person and by phone in May, July, and October of 2022 regarding Raymond's death and the insolvency of the business, and had at various points during litigation admitted in her Statement of Defence to being the Executor of her late father's estate — though she later amended that position inconsistently. The court found no palpable or overriding error in the motion judge's conclusion.

On the third ground — ownership of the transferred properties — the court found that the motion judge had made no binding finding of fact on this issue. The comments regarding property proceeds were made in obiter, in the context of explaining the distinction between liability and enforceability. The question of whether the properties formed part of the estate was expressly left open to be determined if and when TD sought to enforce its judgment.

Ruling and overall outcome

The Divisional Court, per Shore J. (with O'Brien and Smith JJ. concurring), dismissed the appeal in its entirety. The underlying summary judgment order requiring Renee Lynn Mootrey, as Estate Trustee for the Estate of Raymond C. Mootrey, to pay TD the sum of $49,328.06 — together with prejudgment and postjudgment interest at TD's prime rate plus 3.00% per annum from November 7, 2022 — was upheld. TD, as the successful party, was awarded appeal costs fixed at $7,500, all-inclusive, in addition to the $10,000 in costs fixed at the motion level, bringing the total fixed amount ordered in TD's favour to $66,828.06, exclusive of the running interest.