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TRANSCRIPT
TRU LAW
WILLS & ESTATES CAN
Winter 2014
Aachal Goundar
Aachal Goundar
ContentsINTRODUCTION...........................................................................................................................................7
WILLS AND ESTATES SUCCESSION ACT (WESA)........................................................................................7
ORDER OF DEATH & BODY.......................................................................................................................9
DISPOSITION OF PROPERTY ON TESTACY................................................................................................9
Bird v. Perpetual Executors, 1946 AusHc...........................................................................................10
Hutton v. Lapka Estate, 1991 BCCA...................................................................................................10
CHALLENGING A WILL............................................................................................................................11
CONTRACTS TO MAKE WILLS.................................................................................................................11
WILL SUBSTITUTES.....................................................................................................................................11
Pecore v. Pecore, 2007, SCC...............................................................................................................13
Madsen Estates v. Saylor, 2007 SCC..................................................................................................13
Mordo v. Nitting, 2006 BCSC..............................................................................................................15
National Trust v. Robertshaw, 1986 BCSC.........................................................................................16
Roberts v. Martindale, 1998 BCCA.....................................................................................................16
INTERPRETATION OF AMBIGUOUS WILLS.................................................................................................16
AMBIGUITY IN INTENTION.....................................................................................................................17
AMBIGUITY IN GIFTING TO PEOPLE.......................................................................................................17
Re Harrison: Turner v. Hellard (1885)................................................................................................19
Howell v. Howell Estate, 1999 BCCA..................................................................................................19
Moiny Estate 2001 BCCA...................................................................................................................19
Milwarde-Yates v. Sipila 2009 BCSC...................................................................................................19
Lee v. Lee Estate (1993) BCLR............................................................................................................19
WILL-MAKER: AGE, CAPACITY & INTENT...................................................................................................21
LEGISLATION..........................................................................................................................................21
ATTACKING A WILL................................................................................................................................21
TESTAMENTARY CAPACITY....................................................................................................................22
A. General Insanity/Dementia...............................................................................................................23
Leger v. Poirer [1944] SCC..................................................................................................................23
Re Davis (1963) ON CA.......................................................................................................................23
Royal Trust Co. v. Rampone [1974]....................................................................................................24
B. Delusions...........................................................................................................................................24
Banks v. Goodfellow (1870)...............................................................................................................26
O’Neil v. Royal Trust Co. [1946] SCC..................................................................................................26
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Skinner v. Farquharson (1902) SCC....................................................................................................26
Royal Trust Company v. Rampone 1974 BCSC...................................................................................26
Ouderkirk v. Ouderkirk, [1936] SCC....................................................................................................26
SUSPICIOUS CIRCUMSTANCES...............................................................................................................27
Barry v. Butlin....................................................................................................................................27
Vout v. Hay [1995] SCC......................................................................................................................28
KNOWLEDGE AND APPROVAL...............................................................................................................28
Russell v. Fraser (1980) B.C.C.A..........................................................................................................28
UNDUE INFLUENCE................................................................................................................................29
Field v. James, 1999 (BC SC)...............................................................................................................29
FRAUD...................................................................................................................................................29
Bollsnstz Estate v. Simon, 2006 SKCA.................................................................................................29
MISTAKE................................................................................................................................................30
Rhodes v. Rhodes...............................................................................................................................30
WILL FORMALITIES....................................................................................................................................30
LEGISLATION..........................................................................................................................................30
FORMS OF WILLS...................................................................................................................................30
A. ATTESTED/FORMAL...........................................................................................................................30
CURING DEFICIENCES........................................................................................................................31
REQUIREMENTS.................................................................................................................................31
Ball v. Taylor (1999) (B.C.S.C.)............................................................................................................32
Re White (1947) NSSC........................................................................................................................32
Re Bradshaw Estate (1988) NB..........................................................................................................33
Re Wagner (1959)..............................................................................................................................33
Chesline v. Hermiston [1928] ONSC...................................................................................................34
Bolton v. Tartaglia (2000) BCSC.........................................................................................................34
INCORPORATION BY REFERENCE.......................................................................................................34
Re Jackson [1985] (B.C.S.C)................................................................................................................34
B. HOLOGRAPH WILLS...........................................................................................................................34
Bennett v. Gray [1958] SCC................................................................................................................35
Canada Permanent Trust Company v. Bowman [1962] SCC..............................................................35
Re Forest (1981) Sask C.A..................................................................................................................35
Re Clarke (1982).................................................................................................................................36
Re Dixon-Marsden Estate (1985) Ontario Surrogate Court................................................................36
Re Brown Estate, 1954.......................................................................................................................36
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C. PRIVILEGED WILLS.............................................................................................................................37
Re Booth [1926].................................................................................................................................37
D. INTERNATIONAL WILLS......................................................................................................................37
TESTAMENTARY GIFTS...............................................................................................................................37
GENERAL................................................................................................................................................37
GENERAL AND PECUNIARY GIFTS..........................................................................................................38
Frye v. Frye Estate (2008) ONCA........................................................................................................39
Re Miller [1927] ONSC.......................................................................................................................39
Re Willcocks, [1927]...........................................................................................................................39
Re McLean (1969) NBCA....................................................................................................................39
DEMONSTRATIVE GIFTS.........................................................................................................................39
Re Webster’ Gross v. Webster [1937]................................................................................................39
SPECIFIC GIFTS.......................................................................................................................................40
Culbertson v. Culbertson (1967) SKCA................................................................................................40
RESIDUARY GIFTS...................................................................................................................................40
ABATEMENT..........................................................................................................................................41
Lindsay v. Waldbrook (1897) ONCA...................................................................................................42
ADEMPTION...........................................................................................................................................42
Re Hunter (1975) ONSC......................................................................................................................42
LAPSE & SURVIVORSHIP.........................................................................................................................43
Re Stuart (1964) BCSC........................................................................................................................43
Re Wudel AB......................................................................................................................................44
Trebett v. Arlotti-Wood (2004), BCCA................................................................................................44
Milthorp v. Milthorp B.C.S.C..............................................................................................................44
VESTED AND CONTINGENT GIFTS..........................................................................................................44
Property Law Act, s. 8........................................................................................................................47
General Principles of Vesting:............................................................................................................47
Re Brailsford [1916]...........................................................................................................................48
Re Archer (1907) ONSC......................................................................................................................49
Re Barton [1941] SCC.........................................................................................................................49
Re Stephens: Royal Trust Co. v. East (1978) BCSC..............................................................................49
Re Taylor (1972) ONSC.......................................................................................................................50
Re Squire (1962) ONSC.......................................................................................................................50
Re Krause (1985) ABSC......................................................................................................................51
Church v. Hill [1923] SCC....................................................................................................................51
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REVOCATIONS, CHANGES & MUTUAL WILLS.............................................................................................52
CODICILS................................................................................................................................................52
Henderson v. Fraser 1924 (SCC).........................................................................................................53
Macdonell v. Hudson (Estate of), 1995 BCSC.....................................................................................53
Alma Gertrude Turner (Estate of), 2003 BCSC....................................................................................53
REVOCATION.........................................................................................................................................53
Leonard v. Leonard [1902].................................................................................................................55
Re Lawer, 1986 SKCT.........................................................................................................................55
Re Norris, 1946 BCSC.........................................................................................................................55
Re Adams, 1992 UK...........................................................................................................................55
REVOCATION BY MARRIAGE..............................................................................................................55
Challenging the Will under WESA......................................................................................................56
REVOCATION OF GIFTS......................................................................................................................56
LOST WILLS............................................................................................................................................57
Sugden v Lord St Leonards, 1876.......................................................................................................58
Lefebvre v Major, 1930 SCC...............................................................................................................58
Alma Gertrude Turner (Estate of), 2003 BCSC....................................................................................58
CONDITIONAL REVOCATION/ DEPENDENT RELATIVE REVOCATION......................................................58
Re Sorenson, 1981 BCSC....................................................................................................................58
In Re Jones, Decd, 1976 UK................................................................................................................59
REVOCATION – POWERS OF APPOINTMENT.........................................................................................59
ALTERATIONS IN A WILL........................................................................................................................59
Re Douglas Estate (1986)...................................................................................................................60
Smith Estate, 2012 ABQB...................................................................................................................60
REVIVAL OF REVOKED WILLS.................................................................................................................60
Re McKay, 1953 BCSC........................................................................................................................61
JOINT AND MUTUAL WILLS....................................................................................................................61
University of Manitoba v. Sanderson Estate, 1998 BCCA...................................................................61
Spousal Trust.....................................................................................................................................61
ESTATE ADMINISTRATION.........................................................................................................................62
GRANT OF LETTERS PROBATE OR ADMINISTRATION.............................................................................62
PROBATE................................................................................................................................................62
APPLICATION FOR ADMINISTRATION....................................................................................................63
SECURITY FOR EXECUTOR/ADMINISTRATOR — BONDS........................................................................65
EXECUTORS & ADMINISTRATORS..........................................................................................................65
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APPLICATION PROCEDURES FOR PROBATE...........................................................................................68
PUBLIC GUARDIAN AND TRUSTEE (PGT)................................................................................................70
CHAIN OF EXECUTORSHIP......................................................................................................................71
POST GRANT..........................................................................................................................................71
REPORTING LETTER TO CLIENT..............................................................................................................72
FINISHING THE JOB................................................................................................................................72
CHALLENGES TO WILL................................................................................................................................74
LEGISLATION..........................................................................................................................................75
WILLS VARIATION APPLICATIONS..........................................................................................................75
PROCEDURE...........................................................................................................................................75
SPOUSAL CLAIMS...................................................................................................................................76
ISSUE CLAIMS........................................................................................................................................77
PROPERTY AVAILABLE TO SATISFY CLAIMS............................................................................................78
Tataryn v. Tataryn, 1994 SCC.............................................................................................................79
Bridger v. Bridger Estate, 2006 BCCA.................................................................................................79
Saugestad v. Saugestad, 2008 BCCA..................................................................................................79
Picketts v. Hall Estate, 2009 BCCA.....................................................................................................79
Waldman v. Blumes, 2009 BCSC........................................................................................................79
McBride v. Voth, 2010 BCSC..............................................................................................................79
SOLICITOR-CLIENT OBLIGATIONS...........................................................................................................80
Romans v. Tassone, 2009, BCSC.........................................................................................................80
Cardinal v. Tassone, 2013 BCSC 609..................................................................................................80
COURT COSTS........................................................................................................................................80
Maddess v. Racz, 2009 BCSC 1550.....................................................................................................82
EXECUTOR’S FEES..................................................................................................................................82
Chevrefils Estate, 2010 BCSC 753.......................................................................................................83
PROBATE ACTIONS................................................................................................................................83
SUMMARY OF PROBATE PROCESS.........................................................................................................83
INTESTATE SUCCESION..............................................................................................................................83
INTESTACY RULES (Part 3, WESA)..........................................................................................................84
SPOUSES................................................................................................................................................84
CHILDREN & KIN....................................................................................................................................85
SPOUSAL HOME.....................................................................................................................................85
ESCHEAT ACT.........................................................................................................................................86
LETTERS OF ADMINISTRATION..............................................................................................................86
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Vaughan (Estate of), 1990 BC SC.......................................................................................................87
Wagg v. Bradley, 1996 BCSC..............................................................................................................87
Bank of NS Trust Co. v. Van Raan et al., 2005 BCSC...........................................................................87
Jung (Re), 1979 BCSC.........................................................................................................................87
POWERS OF ATTORNEY.............................................................................................................................88
GENERAL................................................................................................................................................88
CAPACITY TO MAKE AN ENDURING POA...............................................................................................88
APPOINTING AN ATTORNEY..................................................................................................................89
FORMALITIES.........................................................................................................................................89
THE “ENDURING PART”.........................................................................................................................90
POWERS OF THE ATTORNEY..................................................................................................................90
DUTIES OF AN ATTORNEY......................................................................................................................91
PRIVILEGES AND LIABILITY.....................................................................................................................92
REVOCATION/SUSPENSION/TERMINATION...........................................................................................92
TRANSITIONAL - DEEMED EPOAS..........................................................................................................92
UNDUE INFLUENCE................................................................................................................................93
McMullen v. Weber, 2006 BCSC.........................................................................................................93
Easingwood v. Cockroft, 2013 BCCA..................................................................................................93
Houston v. Houston 2012 BCCA.........................................................................................................93
Parnell v. BC 2004 BCCA....................................................................................................................94
Egli (PGT) v. Egli 2005 BCCA...............................................................................................................94
Desharnais v. Toronto Dominion Bank...............................................................................................94
REPRESENTATION AGREEMENTS...............................................................................................................94
GENERAL................................................................................................................................................95
SECTION 7 — Standard provisions in RA................................................................................................95
SECTION 9 — Enhanced Provisions........................................................................................................95
EXECUTION............................................................................................................................................96
REPRESENTATIVES.................................................................................................................................96
MONITORS.............................................................................................................................................97
TERMINATION OF AGREEMENT.............................................................................................................98
CONFLICTS.............................................................................................................................................99
ADVANCE DIRECTIVE FOR HEALTHCARE....................................................................................................99
PUBLIC GUARDIAN & TRUSTEE..................................................................................................................99
LEGISLATION..........................................................................................................................................99
GENERAL STATUTORY POWERS.............................................................................................................99
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ROLE OF PGT........................................................................................................................................100
COMMITTEES...........................................................................................................................................101
GENERAL..............................................................................................................................................101
APPOINTMENT OF COMMITTEE..........................................................................................................101
POWERS OF COMMITTEE....................................................................................................................103
COMPENSATION & FEES OF COMMITTEE............................................................................................104
EFFECT OF COMMITTEE ON POA AND REPRESENTATION AGREEMENTS............................................104
EFFECT OF DEATH OF PATIENT............................................................................................................105
SOLICITOR’S RESPONSIBILITIES............................................................................................................105
Simons v. Simons 2013 BCSC............................................................................................................107
Lindberg v. Lindberg 2010 BCSC.......................................................................................................107
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WILLS & ESTATES CANWM = will-makerB = beneficiaryWESA = Wills Estates and Succession Act
1. When did WM die? Determines whether WESA applies. 2. Is there a will? 3. Are there other testamentary-like documents? 4. Are there any notes?
INTRODUCTION
WILLS AND ESTATES SUCCESSION ACT (WESA)• received royal asset on October 29, 2009; will come into effect on March 31, 2014• repeals and replaces the following:
• Wills Act• Wills Variation Act (WVA)• Estate Administration Act (EAA)• Probate Recognition Act
• It will apply to all deaths occurring after that date. • WESA will not invalidate a will validly made before it came into force; nor will it revive a will validly
revoked.
NEW PROBATE RULES• New rules dealing w/ probate & estate administration will take effect on March 31, 2014 (“the
effective date”). The new probate rules are Part 25 of the BC Supreme Court Civil Rules and replace Rules 21-4 and 21-5.
• Most of court forms & procedures that were in place prior to March 31, 2014 will change under WESA & new probate rules.
TRANSITION• If an application was filed before the effective date under a former probate rule and met all the
requirements of the former rules, the application is deemed to continue under the new probate rules.• As of March 31, 2014, all filings respecting an estate will be under the new probate rules and the
registry will reject the former probate forms.• Where an application for an estate grant is made after WESA comes into effect, the new probate rules
will apply even where the person died prior to the effective date.• Under section 185 of WESA, the following parts will apply to deaths occurring on or after the date on
which those parts come into force: Part 2 - Fundamental Rules Part 3 - When a Person Dies Without a Will Part 6 - Administration of Estates
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• WESA 186 will apply only if WM dies on or after date on which Part 4 comes into force, but does not invalidate a will validly made before effective date nor revive a will validly revoked before effective date.
• WESA 187 will apply to designations (whenever made) if the participant dies on or after the effective date.
• Under WESA 188, administration and probate grants granted under the Estate Administration Act will be deemed to be valid under WESA.
• WESA 189 will apply to wills made on or after the effective date.• Finally, the court may give any transitional directions or make any orders with respect to an Act
repealed by WESA.
WESA — biggest change — testamentary-like dispositions are going to be considered by the courts. Things that may not meet the formal requirements can be modified by the courts. Estates practice - Lawyers will have to explain to clients that even if they have paid money and made out a valid will, that will can be changed by the courts if there is any notes made by the client at home.
*** PRACTICE POINT• In order to indemnify yourself if the client has notes at home that could change the formal will -
Reporting Letter -- include that you will not be advising the client if there are any changes to legislation and if the client leaves any notes or comments, advise that this could affect the will.
• Include in the will that you revoke all prior wills. • Courts will look at context - who prepared the will, what type of advice was given, what the will
disposes of. • Under WESA - deed of gift is considered a testamentary-like disposition.
ORDER OF DEATH & BODYPresumption of Death Act• S. 3 – No reason to believe a person is living + reasonable grounds to suppose person dead – can apply
for order presuming death. • S. 4 – if PR has reasonable grounds to believe person is not dead, they must cease dealing w/ estate. • S. 5 – if person later found alive, any distribution of their property deemed to be fraud – unless court
order.
Survivorship• WESA 5(1) – if 2 or more people die at the same time (or in circumstances where it can’t be said who
died first) rights of property will be determined as if each had survived the other, absent a contrary intention. Purpose – avoid unnecessary double probate & administration of 2 estates.
• WESA 5(2) – if 2 JTs die together, each person presumed to have held their interest as tenants-in-common – each person disposes of their ½ interest through their own estate – ordinary survivorship rule doesn’t apply.
• WESA 6 – if property passes to C upon the happening of an event – the event is presumed to have occurred (A’s will leaves property to C if B dies 1st).
• WESA 8 – if gift is conditional on death of person & the order of death of WM and the person is unknown, presume person died. E.g. “To B if he survives A” – A & B die together – B loses gift as B is presumed to have died first.
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• WESA 10 – if a person doesn’t live for at least 5 days longer than a deceased person, they’re deemed to have died before the deceased for all purposes affected the estate of the deceased person, or property they were able to gibe by will to another – 5 day survival rule.
Insurance Act Presumptions• B always presumed to die before the insured. • If no other B named, proceeds go to insured’s estate.• If insured has a will, proceeds go to residue; if intestate, proceeds form part of general estate.
Dealing with Bodies• It is a criminal offence to neglect to deal w/ lawful duties w/r/t/ burial or to improperly/indecently
interfere w/ remains – CC 182. • Right to decide in order: PR named in will, spouse, adult child, adult grandchild, legal guardian if
minor, parent, adult sibling, adult niece/nephew, etc.
DISPOSITION OF PROPERTY ON TESTACY• Will — testamentary instrument by which WM disposes of his assets. • In order for will to be effective WM must have:
(a) Intended will to have dispositive effect; (but may also appoint a guardian for one’s minor children and exercise a power of appointment sanctioned by statute).
(b) Intended will not take effect until after death and to be entirely dependent on death for its operation;
(c) Intended for will to be (and in fact is) revocable;(d) Executed will in accordance w/ formalities under applicable legislation (Wills Act or WESA). (e) Intended to make a testament or a will -- made animo testandi.
Nature of a Will• Testamentary or inter vivos
• Docs are testamentary if they depend on death for their vigour & effect (Hutton). • If WM directs testamentary disposition shall not take effect until after his or her death, it is not a
will and cannot take effect as such (Kavanagh Estate v. Kavanagh), unless language can be construed as merely postponing possession by B (Graham v. Graham).
• Doc may not be testamentary if it takes effect immediately, even though enjoyment of benefits postponed until death of person. (Bird; Mordo).
• Conditional Wills• Some wills contain conditions – e.g. “in the event of my death on this trip to Russia, I leave my
property to X”• Will only valid later if the condition was in fact the motivation to make the will – i.e. WM
contemplated his death (Re Heubner – WM made will before going on trip).• Can use extrinsic evidence to resolve ambiguity as to whether words in a will make will conditional
upon a happening (Re Green Estate). • Multiple wills
• So long as wills don’t conflict, all testamentary docs can be combined to form WM’s will (Douglas-Menzies)
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• Delegation of will-making power• General rule: can’t delegate will-making power – BUT can delegate power to distribute property
(Tassone).• General rule of appointment: allows done to make appointments in favour of anyone in the world
(including themselves).
Bird v. Perpetual Executors, 1946 AusHc – substance over form. F: Couple lived w/ Bird. Didn’t pay rent. Man executes doc under seal – instructs execs to pay Bird rent after death. Valid?H: No, substance & effect of doc made is testamentary but it didn’t comply w/ will formalities.
Hutton v. Lapka Estate, 1991 BCCA – vigour & effect upon death F: WM loaned her son $296k before death. Administrators found a note (bill of exchange) where son promised to pay WM back – but in event of her death, k was null & void. Testamentary? H: No, K had immediate effect – WM received benefit in form of agreement to pay.
Notes• Expressions of WM must be imperative in form - orders, commands, instructions. If precatory
language (wish, desire) is used, the provision may not be valid. (Johnson v. Farney — WM left estate to wife but further on in will said “I also wish if you die soon after me that you will leave all … to my people and your people equally”. Direction not binding on widow).
• Wills obtained by fraud, duress, or undue influence wills made when WM lacked testamentary capacity is invalid. (Note: effect of conditional wills).
• Directions on disposition of WM’s body not binding on executor (Hunter v. Hunter). • WM who is contractually bound to dispose of property in a certain way is not prevented from
disposing of that property in a will. The testamentary gift may be a breach of contract & may give rise to an action but does not affect validity of the gift itself. (Frye v. Frye Estate — WM made testamentary gift of shares he owned to a sister in violation of restrictions in shareholder agreement. Testamentary gift valid).
• Will includes all valid testamentary instruments created by WM and which are unrevoked. This includes will, codicil, (amendment to will) and any other instrument incorporated by reference.
• Deed of gift vs. codicil — deed of gift is for a specific item and interpreted on the date you signed the deed. Codicil does not take effect until WM dies.
• Difference between succession and probate• intestacy of will — look at legislation• succession — transfer of property either w/in will or outside of will. • probate — proving a will or court succession of will.
• Spes Successionist• The hope that named B of a will or B if person dies intestate, have of surviving WM so they can
inherit. If B predeceases WM the share of estate will not go to him or her but to others. • Spes successionist is not a property interest.
CHALLENGING A WILL• Will can be challenged under WVA, after March 31, 2014 - under WESA. • Any spouse or child of WM can challenge will in court b/c of disagreement with dispositions.• If you apply under WVA it ties up estate - may actually force parties to come to a solution.
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• If you are an executor you can apply to court for a solution but you may be reprimanded if it is a very easy solution.
• You would advise the clients to choose people over animals but at the end of the day it is the client’s choice if she wishes to leave her entire estate to her pets.
CONTRACTS TO MAKE WILLS• An agreement to leave property to another by will may take two forms. A person may either promise
to leave his or her property, some specific property, or an amount of money to another on death or, having already made a will in which he or she left property to another person, agree with that person not to revoke the will.
• The validity of a contract to make a will is determined by law of contracts, not by law of wills. • Although, despite any agreement to contrary, will is always revocable, contract, if otherwise valid, not
affected by fact will is revoked (Re Marsland; Lloyds Bank Ltd. v. Marsland).
WILL SUBSTITUTESGENERAL• Benefits:
• Avoidance of probate & probate fees — Probate process is costly, slower, and more complicated — e.g. to transfer jointly-owned real property all you need is death certificate.
• Avoid wills variation claims & preserve privacy (probated wills are public documents). • Methods: inter vivos gifts, joint bank accounts, gifts mortis causa, inter vivos trusts, multiple wills. • Disadvantages:
• irrevocable once grantor has given the gift unless grantor has reserved the power to reverse the gift.
• In a joint tenancy, other party may refuse to relinquish it (e.g. in event of a separation), his creditors may sue for that property, or his spouse may make a claim on it in the event of a marriage breakdown.
• The other party may face tax consequences (capital gains tax) if he tries to sell it after the death of the original holder.
• presumption of advancement or resulting trust? (Pecore v. Pecore & Saylor v. Madsen Estate, SCC held that b/c principle reason for presumption of advancement as regards children is parental obligation to support dependent children, & b/c common for ageing parents to transfer assets into joint names of themselves & an adult child so child can assist them in managing their affairs, presumption of advancement should no longer apply when a parent makes a gratuitous transfer to an adult child, whether dependent or not. Instead the presumption of resulting trust applies to the transfer. THF onus on adult child to rebut presumption by providing that parent intended a gift.)
• Probate fees• BC legislation governing probate fees - Probate Fee Act.• Probate fees in BC - sliding scale. Currently, court registry will charge you for estate of 0 - 25000 a
$200 application fee. No consistency. $6 per thousand. Anything over $50,000 is $14/ thousand. • Gross value - what is the market value of the assets? Assess value? Real estate
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• Obligations - appreciate on how to advise client on value. Remember that there are tax consequences if you go too low — capital gains tax if you try to sell it. Tell client to go get tax advice - so that they are fully informed about the value of that property.
• The probate fees in BC is significantly higher than in Alberta. As a lawyer, your obligation is to keep probate fees low.
Lecture Discussion:• You can name a B in a tax free savings a/ct. It goes directly to B and not included in will. It is a means
for providing for someone who you don’t have in will. • Under WVA you have obligations to certain family members. TFSAs allows you to plan around will &
avoid bequest being challenged under WVA. • If you name your spouse as B on the first two, there is no deemed disposition on the passing. If you
name an RSP to anyone except a spouse, it is considered cashed in on the day you pass away. When you put money into RSP, it is considered a tax deferral. Govt still wants $ when you take it out.
• If no B, $ will go into estate. There will be probate fees in addition to taxes.
***PRATICE POINT: Give it while you are alive or talk about it with your beneficiaries before you go. Otherwise, disposition will expose will to challenges under WVA. If you gift while you are alive, you will decrease probate fees.
JOINT TENANCIESGeneral• Joint tenancy with right of survivorship (ROS) is a type of non-will testamentary disposition — on
death, property passes to the surviving JT. • When title to real property is taken by two persons in joint tenancy, the jus accrescendi operates on
the death of the first of the joint tenants to augment the interest of the survivor. When one joint tenant passes away, the title automatically passes to the survivor. (EAA, s. 2).
• “The right of survivorship exists independently of any agreement in the case of joint ownership of personal property” (Edwards v. Bradley).
• Deed must clearly state title is taken in joint tenancy, otherwise tenancy in common is created. • If transaction which creates a joint tenancy is one of convenience only, donee may hold the interest
upon a resulting trust for donor. Principle similar w/ respect to personal property generally.• True JT is one where both parties contribute — where one party has given no consideration can lead
to question about whether a JT has arisen. • Transferor’s intention determines whether beneficial interest passes immediately to the other JT upon
death. • no intention to pass interest — resulting trust. • intention to make gift effective only upon death — testamentary & must then meet formalities. • Intended immediate gift of the interest — inter vivos gift.
Joint Bank Accounts (Pecore)• Creation of a joint bank account creates a debtor and creditor relationship between bank and
depositor, so that bank holds legal title.
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• In a JBA where A intends to retain exclusive control until death & only transfer the remaining amount to B, the right of survivorship — both legal AND equitable — vests immediately when the JBA is opened & therefore inter vivos in nature despite the ability of A to drain the a/c during their life.
• Bank documents may be used to determine intention of transferor if they’re sufficiently detailed.
Presumption of Joint Tenancy• If any property is jointly owned by spouses, that is prima facie proof that they intended to own the
property as joint tenants.
Presumption of Resulting Trusts• rebuttable presumption of law that applies to gratuitous transfers — regardless of who holds legal
title, the equitable title is retained by the transferor (or their estate). • onus of proof to rebut the RT, on the BOP, is on the transferee — relevant intention is intention of
contributor at a time of contribution (Pecore).
Presumption of Advancement• In the context of certain relationships, P/A will apply instead — equitable title presumed to have
passed with legal title — onus then on transferor to rebut. • P/A applies to transfers from husband to wife (though largely removed by legislation) AND to
gratuitous transfers from parent to minor child, whether by way of outright transfer or into joint names of the transferor and child, (Pecore). But it no longer applies to a gratuitous transfer to an adult child. Instead presumption of resulting trust applies to latter transfer (Pecore)
Totten trust• informal trust. Nothing is documented Where one person goes to the bank and puts money in for the
benefit of B. • If you go to open up a trust account, you should actually open it as an education savings program, 2)
the banks may not want to touch that unless there is a formal document,
Pecore v. Pecore, 2007, SCC – JBA R: Joint bank transfer — ROS gifted; intention of transferor is KEY; Presumption of advancement does not apply to adult children. F: F gratuitously transferred bulk of his estate into joint accounts w/ D. Residue of F’s estate was to be shared by D & H. Marriage breaks up. H claims joint accounts form part of estate on basis of RT. H: No, intention of F was clear. JBA was to go to D alone. Evidence was solicitor’s testimony that F believed JBA’s had been dealt with. Bank docs said “right of survivorship”; F has history of supporting D.
Madsen Estates v. Saylor, 2007 SCC — resulting trust not rebutted. F: F made D joint signatory on bank accounts, w/ ROS + gave her POA. As executor, D doesn’t include contents of JBA in estate. Siblings sue. H: RT not rebutted. Evidence included F paid all taxes and retained control. Bank docs didn't reference beneficial ownership. D’s evidence unreliable.
Gifts Inter Vivos• An inter vivos gift is one that donor parts with absolutely while living. • In order for gift to be valid donor must have animus donandi. • Delivery: If gift is a chose in possession, the delivery is usually manual and can in some circumstances
be constructive delivery. If the gift is a chose in action, it is transferred by assignment or constructive
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delivery. Gifts of personal property may be made by a deed, and those of real property must be made by a deed.
Gifts Mortis Causa• Gift mortis causa is an inter vivos gift of personalty made in contemplation but not necessarily in
expectation of donor’s death. • Delivery: Gift must be delivered to donee but in certain circumstance constructive delivery is
permitted. • Although gift takes effect immediately, it is dependent for its absolute effect upon death of donor.
Hence, donor can revoke gift while living — revoked automatically if donor recovered from the feared peril.
INTER VIVOS TRUSTSGeneral• asset transfer to trusts triggers disposition that costs money — usually scares people off — but there
are exceptions. • Alter ego trust — persons 65+ can transfer assets w/o paying capital gains tax until death of the
settlor. • Joint spousal trust — persons 65+ avoid payment of capital gains tax until the later of the death of the
settlor & surviving spouse. • If a trust takes immediate effect it is not held to be testamentary even if it’s only to be performed
after the death of the settlor (Mordo).
Deeds and Inter Vivos Trusts• A person can convey land absolutely to another person using a deed or retain an interest in it while
also giving interests to others. E.g., X puts land into trust with remainder going to his children. This remainder is a vested interest and possession is postponed until the person’s death. The deed is not regarded as a will because the remainder is presently vested.
• The conveyance is non-revokable. The donor is restricted from changing this unless he has made this conveyance conditional on something, that is if he has retained a reversionary interest, possibility of reverter, right of re-entry, or a legal interest under use under the Statute of Uses.
• A problem that arises with deeds absolute and similar transfers is that grantor retains control over deed and does not intend that it shall have effect until his or her death. If that is the situation, the deed is really a will, because it is “dependent upon his death for its vigour and effect” but unless it is executed with appropriate formalities, it cannot take effect as one. Case: Carson v. Wilson.
• Does the deed create an inter vivos trust? • Is the deed a testamentary instrument? It is important to look at the degree of control retained by
the grantor over the gifts while he lived. Has there been delivery of the deed? Also ask, whether it was his intention that the gifts be transferred only upon his death.
• If the deed is a testamentary instrument, have all the formalities of a will been followed?• An inter vivos trust is revocable. The reservation of a power of revocation did not have the effect of
making the document testamentary (Anderson v. Patton; Campbell v. Fenwick). The reason why a power to revoke does not make an inter vivos trust testamentary is that, although the title may be recalled under the power, it passed to the trustee when the trust was created. It follows that the beneficial interests also took effect at that time (Stone v. Hackett).
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Alter Ego trust• Conditions:
• (a) the tax payer was alive and 65 years of age or older when it was created;• (b) it was created after 1999; • (c) the taxpayer was entitled to all the income before his or her death;• (d) no person other than the taxpayer can receive or obtain the use of any of the income or capital
of the trust before the taxpayer’s death; and • (e) the trust did not make an election under subpart. 104(4)(a)(ii.1) of the Act.
Joint Spousal or Common Law Partner trust• Conditions
• (a) the taxpayer was alive and 65 years of age or older when the trust was created; • (b) it was created after 1999;• (c) the taxpayer or the taxpayer’s spouse was, in combination with the spouse or the taxpayer as
the case may be entitled to receive all the income with the trust until the later of the death of the taxpayer and the death of the spouse; and
• (d) no other person can receive or obtain the use of the income or capital of the trust before the later of those deaths.
Mordo v. Nitting, 2006 BCSC — alter ego trust, immediate effect, intention of settlor keyF: Family business — Mom wants to conclusively disinherit bad son. To avoid wills variation assets (including warehouse) placed in trust — herself & D named as Bs. Mom retained power to call for transfer of LT. After her death, son tried to get his hands on $ by claiming the transfers were testamentary & invalid. H: Mom intended the trust to have immediate effect. Nor is trust void on policy grounds. Alter ego trusts valid estate planning tool. (1) language was present — tense, clause that trust was irrevocable by settlor;(2) mom was B presently entitled to income from trust property until her death;(3) mom had filled out Form A for the warehouse — i.e. did everything in her power needed to effect transfer.
LIFE INSURANCE PLANS• Life insurance — contract under which insurer agrees to pay insurance monies on death or a specified
event. The term “life insurance” includes an annuity contract. Earlier cases held annuity contracts issued by insurance companies were not life insurance and, thus, proceeds were subject to claims of creditors (Re Beck (1976) Man CA).
• A contract of life insurance may be an individual or a group policy. Individual insured &, normally, member of group have right to designate a beneficiary, or of his or her benefits under the group contract. Insured may make a designation in the contract of insurance (Insurance Act, s. 190) or by will (IA s. 192).
• Advantages: Allows one to avoid claims of creditors. If you designate a B other than your estate, proceeds of insurance do not form part of your estate but pass directly to B. This protection is not absolute.
• Issues: (1) as a testamentary disposition, lack of compliance w/ formalities (2) contractual privity — B (as 3rd party) cannot enforce K.
• Solution: Legislation supports informal plans designations AND allows Bs to enforce K. • Insurance Act:
• 59(1) — insured can designate B though K or by declaration.
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• 61(1) — designation in a doc purporting to be a will is not invalid just b/c instrument is invalid. • 63 — if B predeceases insured, share payable to surviving Bs or if none, to the estate of insured.
RETIREMENT PLANS• Often takes form of life annuity & annuity may be guaranteed for a specified number of years & made
payable to employee’s estate or other B as designated by employee. • Designations under retirement plans are testamentary in nature (MacInnes) — confirmed by
definition of “testamentary instrument” in WESA 1(1).• HVR, where retirement plan set up by way of trust (RRSP) full vigour & effect not entirely dependent
upon death.• Designations to spouses are not automatically revoked upon divorce — so don’t forget to cut out the
ex (Roberts). • WESA 85(1) — can designate another person to take advantage of plan benefits. • WESA 85(2) — designation must be in writing & signed by person making it (or by another in the
presence of the person making it, at their discretion). • Pension plans are much less protected from claims of creditors than life insurance, unless issued under
Insurance Act. • Note: Law and Equity Act R.S.B.C. 1996, c. 253, ss. 49-51.
• The sections cover registered retirement savings plans that are either registered under the Income Tax Act or a TFSA w/in meaning of Income Tax Act.
• ss. 49(2) & 51(2) of Law and Equity Act provide that proceeds from a “registered plan” do not form part of estate of plan’s owner and are not available to owner’s creditors.
• Federal Bankruptcy and Insolvency Act provides that pension plans are protected from creditors in a bankruptcy, except for contributions made in12 months prior to bankruptcy, & except if creditor is Canada Revenue agency or an estranged spouse.
• If you name children as beneficiaries as RSPs it is taxable b/c it does not designate a spouse. The tax will come to the estate and the benefit will go to the beneficiary. There is a potential to bankrupt the estate.
*** PRATICE POINT
Advise client to get tax advice from a tax professional
National Trust v. Robertshaw, 1986 BCSC - plan in trust (RRSP) not testamentaryF: WM designated wife as B of his RRSP. Couple divorces — wife remains on as designate B. WM’s will says nothing about RRSP, but it does have a revocation clause. WM’s kids claim RRSP designation was testamentary & therefore, revoked under current will. H: No, RRSP designation was revocable inter vivos trust — full vigour & effect of trust not entirely dependent on WM’s death.
Roberts v. Martindale, 1998 BCCA — F: WM appointed husband B of life insurance plan. Separation agreement: spouses gave up all claim on the estate of the other. WM thought she’s revoked designation. After death, money paid to ex. WM’s sister brought action to claim monies. TJ imposed CT of funds. H: Upheld on appeal.
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INTERPRETATION OF AMBIGUOUS WILLSGeneral rule: A Court may not rectify a will by inserting words to the will.
AMBIGUITY IN INTENTION
Legislation (WESA 4(2))• Doctrine of interpretation is based on the language used in the will – extrinsic evidence of
testamentary interest is inadmissible except where:• Provision of a will is meaningless.• Provision of a testamentary instrument is ambiguous on its face OR in light of other evidence is
ambiguous given surrounding circumstances.
General Principles• Goal of construction is to ascertain the WM’s true intention – ONLY proceed if WM’s intention can’t
be discerned from the language. • Ordinary meaning rule – words to be given their ordinary meaning in light of the circumstances in
which the will was made (Perrin v. Morgan).• Armchair rule – in construction, court must place itself in WM’s position at the time the will was made
(Laws v. Rabbitt). • WM’s knowledge and training will also inform interpretation – technical words more likely to be given
technical meaning if used by professional (Tottrup).• Court won’t intervene unless there’s an ambiguity – if ambiguity said to arise from omission, have to
establish omission unintended (McEwan).
Process• Apply ordinary meaning rule in light of contents of whole will or surrounding circumstances (Haidl).• Look at indirect extrinsic evidence only – e.g. character & occupation of WM; amount, extent,
condition of assets; general relationship of people (Haidl). • Extrinsic evidence can be admitted at the start of the hearing (Wilson v. Shankoff).• Only proceed w/ construction if intention can’t be determined from the plain meaning of the words. • Apply armchair approach – look at circumstances that might reasonably have influenced WM at the
time will was made (Laws v. Rabbitt).• Then construe will (using ordinary meaning rule) in light of those surrounding circumstances (Wilson
v. Shankoff).
Direct EvidenceDirect extrinsic evidence of WM’s intention is inadmissible, w/ only 2 exceptions:
1. Where identity of B is ambiguous (Doctrine of Equivocation). 2. Where identification of property being gifted is ambiguous (Doctrine of Falsa Demonstratio)
Ambiguity in Gifting Property• WM can only gift property he/she is legally or equitably entitled to at the time of death (WESA 41(1)).
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• Any of WM’s property not disposed of in will will be distributed as if property were intestate (WESA 44(a)).
AMBIGUITY IN GIFTING TO PEOPLE
Non-Specific Language• at CL, words in a will that refer to people are assumed to be specific to the time at which the will was • made (Amyot v Dwarris).• under WESA, if you use the words “heir” or “next of kin” you’re assumed to be making distribution
that would occur on intestacy -- WESA 42(2)• child - includes natural & adopted children, but not step-children. Although in some cases, non-
biological kids may be able to take upon construction (Re Simpson).• niece / nephew - includes children of WM’s siblings AND the children of the WM’s spouse’s siblings --
both sides of family (Estate of Holmes)
Gifts Per Stirpes• proper drafting = “to my issue per stirpes” OR “to my children in equal shares but if any child
predeceases my spouse, the share of my predeceased.• child to be paid equally to those children of such predeceased child then surviving my spouse” ---->
worst ever is “per stirpes, in equal shares”• easy to see why people are tempted to use the phrase, but you’re really playing with fire (Tip - forget
you ever heard this phrase).• “per stirpes” implies the possibility of an inter-generational gift -- but again, in construction it all
comes down to the intentions of the WM.
Class Gifts• class = gift to number of persons united/connected by a common tie + WM was looking to the group
as a whole vs making gifts to individuals• with class gifts, if a member of the class dies during the WM’s life, gift doe NOT lapse ---> the survivors
take the gift equally amongst themselves • intention to create a class gift must be clear (Milthorp)
Class Closing Rules• class closes when interest of first member of class vests, if gift is conditional upon happening of an
event (ex/ turn 21)• class closes at the earliest opportunity -- subject, of course, to a contrary intention of sufficient clarity
in the will.• Class prima facie determined at WM’s death - BUT - if there’s a conditional gift to a class, the class is
ascertained when the 1st member’s interest vests• rules apply to gifts of capital, but probably not to gifts of income
Examples of Class Closing: • “To all the children of A” (vested gift, no prior interest).
• when WM dies, any children alive can call for the class - future unborn children of A lose out
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• at death - no kids - the first child of A born will take - class closes• to avoid the rule -- “to the children of A, whether born before or after my death”
• “To B for life, remainder to the children of A” (no contingency, prior interest)• class consists of all children born during the life of B• if no kids alive at death of both WM and B, probable that subsequently-born kid will take
• “To the children of A if they reach 21 years of age” (contingent gift, no prior interest)• if at least on child is over 21 when WM dies, the class closes in favor of existing children• when class closes, those over 21 take their share - those under 21 take if they reach 21 - if they
don’t, their share goes to others in class• if no child is 21, class stay open until one child meets condition - any kids born before that time
(but after WM’s death) join class• “To B for life, remainder to those of A’s children who reach the age of 21” (contingent gift, prior
interest)• earliest date for class closing is the death of B -- prior interest must end before class closes -
members can be added up until that point• no interest can be distributed until B’s death anyways• if B dies, and no kids have met condition, class remains open until the first child reaches 21 years• if child reaches 21 years (vested interest) while B is still alive, but then dies before B -- that child’s
share goes to their estate
Re Harrison: Turner v. Hellard (1885) - presumption of testacy “There is one rule of construction, which is to my mind a golden rule, viz., that when a testator has executed a will in solemn form you must assume that he did not intend to make it a solemn farce - that he did not intend to die intestate when he has gone through the form of making a will. You ought, if possible, to read the will so as to lead to a testacy, not an intestacy. This is a golden rule”COMMENTS:This rule has been applied in BC in: Douet v. Budd [1978] C.A. and Re Bradley; Wagg v. Bradley (1996) S.C.B.C.
Howell v. Howell Estate, 1999 BCCA - restrictive construction of will“It is one thing to try to given effect to a testator’s intention where he has used an ambiguous word or phrase; it is entirely another thing to supply a missing bequest out of thin air.”
Moiny Estate 2001 BCCA – “[A]n instrument, to be a will, must be depositive.”; “the Court may, in the exercise of its jurisdiction of construing a will, interpret a all as if it contained words not actually appearing in the will.”F: Moiny, Armed Forces retiree, left behind an estate valued at slightly under $200,000. He was not survived by any person entitled to make a claim under WVA. If he died intestate, a surviving aunt is entitled, under the intestate succession provisions of EAA, to take. Moiny had signed form, “Canadian Forces Will”. On its face the instrument complies with Wills Act, and previous legislation. He left the estate to Mrs. Del Scheuerman. He neglected to specify the relationship and add the words “all my estate”.I & H: Did Moiny die testate or intestate? He died testate. If the former, which instrument is the will of the deceased? The Canadian Forces Will form. Is the instrument is depositive? YesA: Court disagreed with restrictive holding in Re Morris; Lluoyds Bank Ltd. v. Peak that Court should not impute words to reflect intention of deceased. Here, Moiny intended to give all of his estate to Scheurman.
Milwarde-Yates v. Sipila 2009 BCSC — presumption in favour of testacy. R: presumption: The testator does not intend an intestacy. F: Court asked to interpret the will of Joan MIlwarde-Yates b/c ambiguity as to disposition of remainder of estate. Will appeared to be badly drafted — listed a number of people as beneficiaries. Devlyn Milawarde-Yates, her sole surviving child, contested will arguing another clause in will gave him residue of estate or that his mother’s will failed to dispose of residue of estate, and so remainder should be distributed according to intestacy laws. H: WM did not intend for her son to be a beneficiary of remainder of her estate. She intended a benefit to pass to those named in beneficiary group.
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Lee v. Lee Estate (1993) BCLR - costs“In probate or administration actions or in proceedings for the construction of wills, the rule [that costs follow the event] may be more frequently departed from. In such cases where the validity of a will or the capacity of the testator to make a will or the meaning a will is in issue, it is sometimes the case that the costs of all parties are ordered to be paid out of the estate. This is upon the principle that where such an issue must be litigated to remove all doubts, then all interested parties must be joined and are entitled to be heard and should not be out of pocket if in the result the litigation does not conclude in their favour. The estate must bear the cost of settling disputes as a cost of administration. … The question to be asked in such cases is whether the parties were forced into litigation by the conduct of the testator or the conduct of the main beneficiaries.”
READING NOTES: CONSTRUCTION OF WILL• Avoidance of intestacy is not sufficient to induce the court to give a strained interpretation to the
words which bear a clear and unequivocal meaning (Re McEwen Estate)• Avoidance of intestacy:
• A WM, having put his mind to the issue must not have intended to die intestate (Re Kemp). • There is one rule --- viz., that when a testator has executed a will in solemn form you must assume
that he did not intend to make it a solemn farce, - that he did not intend to die intestate when he has gone through the form of making a will. You ought, if possible, to read the will so as to lead to a testacy not an intestacy (Re Harrison).
• Intestacy intended: That does not mean to say however that a will, having been executed, cannot be interpreted as intentionally or otherwise creating an intestacy (McEwan).
• What was the WM’s intention? • Family circumstances at time of execution of will? (Vaughan: WM intended to provide CL spouse
w/ lifetime benefit, but clear that he did not intend for her to have the capital absolutely — reserved to himself the right to distribute estate upon her death, and intended to do so.
• Circumstances in which will executed? (WM’s physical and mental health, length of time between execution and death, and level of involvement of Bs).
• Primary task in interpreting a will is to determine the actual intention of the WM on the basis of the will as a whole (Re Tyhurst Estate, 1932 SCC — “In construing a will the duty of the court is to ascertain the intention of the testator, which intention is to be collected from the whole will taken together. Every word is to be given its natural and ordinary meaning and, if technical words are used, they are to be construed in their technical sense, unless from a consideration of the whole will it is evident that the testator intended otherwise”.
• Rules of interpretation and construction are applied only if WM’s intention cannot be determined on the plain meaning of the words in the will (Fleury Estate v. Fleury Estate 1965, SCC).
• Previously decided cases considering specific wording may be of interest but are not determinative because of the primacy of the testator’s intention in the interpretation of wills. However, where certain expressions have been frequently construed and have a well-settled meaning, that meaning can usually be taken as representing the testator’s intention unless from a consideration of the whole will it is evident the testator intended another meaning (Tyhurst).
• McEwan: “In the course of the argument we were reminded of the so-called presumption against intestacy. That presumption is sometimes useful where the construction of the will is doubtful and there is room for two interpretations. In such a case the Court will be inclined to lean against an interpretation which will result in intestacy. The avoidance of intestacy is not enough to induce the Court to give an unnatural meaning to words or to construe plain words otherwise than according to their plain meaning. I do not think the presumption has any relevancy in the case before this court.”
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• Howell v. Howell Estate, 1999 BCCA: “It is one thing to try to give effect to a testator's intention where he has used an ambiguous word or phrase – it is entirely another thing to supply a missing bequest out of thin air.”
** transitional deeming provisions such as POAA 42 are effective for procedural or formality matters, but that the new substantive rules will apply to the deemed instrument.
Driedger on the Construction of Statutes (3rd ed.) (¶7, p. 288 of Driedger): The legislature is presumed to know its own statute book and to draft each new provision with regard to the structures, conventions, and habits of expression as well as the substantive law embodied in existing legislation.. . . It is presumed that the legislature does not intend to contradict itself or to create inconsistent schemes. Therefore, other things being equal, interpretations that minimize the possibility of conflict or incoherence among different enactments are preferred.
WILL-MAKER: AGE, CAPACITY & INTENTLEGISLATION
WESAWho can make a will: 36 (1) A person who is 16 years of age or older and who is mentally capable of doing so may make a will.Property that can be gifted by a will: 41 (4) A person may, by will, make a gift of property to which he or she is entitled at law or in equity at the time of his or her
death, including property acquired before, on or after the date the will is made.(5) Unless a contrary intention appears in a will , when a will refers to property, the will, with respect to the property, is to be
interpreted as if it had been made immediately before the death of the will-maker.(6) A gift in a will
(a) takes effect according to its terms, and(b) subject to the terms of the gift, gives to the recipient of the gift every legal or equitable interest in the property that
the will-maker had the legal capacity to give.
Wills ActProperty disposable by will2 A person may by will devise, bequeath or dispose of all property, whether acquired before or after making the will, to which at the time of the person's death he or she is entitled either at law or in equity, including one or more of the following:
(a) estates pur autre vie, whether there is or is not a special occupant, and whether they are corporeal or incorporeal hereditaments;
(b) contingent, executory or other future interest in property, whether the testator is or is not ascertained as the person or one of the persons in whom those interests may become vested and whether the person is entitled to them under the instrument by which they were created or under a disposition of them by deed or will;
(c) rights of entry.Wills of persons under 19 years of age7 (1) A will made by a person who is under 19 years of age is not valid unless at the time of making the will the person
(a) is or has been married, or(b) is a person described in section 5.
(2) For the purposes of section 5 and of this section, a certificate that purports to be signed by or on behalf of an officer who has custody of the records of the force in which a person was serving at the time the will was made and that sets out that the person was at that time a member of a naval, military or air force of a named country is sufficient proof of that fact.
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(3) A person who has made a will to which subsection (1) applies may, while under 19 years of age, revoke the will.Military forces and mariners5 (1) A member of the Canadian Forces while placed on active service under the National Defence Act, or member of the naval, land or air force of any member of the British Commonwealth of Nations or any ally of Canada while on active service, or a mariner or seaman at sea or in the course of a voyage may, regardless of his or her age, dispose of his or her real and personal estate by will in writing, signed by the testator at its end or by some other person in the presence of and by the direction of the testator.(2) If the will is signed by the testator, there is no necessity for the presence, attestation or subscription of any witness.(3) If the will is signed by another person, the signature of that other person must be attested by the signature of at least one person, who must attest in the presence of the testator and of that other person.
ATTACKING A WILL1. Presumption of capacity – will probated in common form (i.e. w/o a trial).
For a duly executed will - testamentary capacity and knowledge & approval are presumed (Vout v. Hay). Presumption of sanity absent contrary evidence (Re Nelson Estate (1999) BCSC).
2. Suspicious circumstances can “spend” this presumption but don’t raise standard of proof required. 3. If will is challenged, burden is on propounder of will to establish capacity and K & A on a BOP (Re
Henry) – in solemn form. 4. Executor named in the will has to make an application for probate and has to establish the following
(a challenger merely has to bring it up but not prove it):(1) the testator satisfied the statutory age requirement to make a will; (2) the will was executed in accordance with the statutory requirements and was not revoked; (3) the testator knew and understood the will and the will was not affected by mistake; and (4) the testator had testamentary capacity.
5. “the onus probandi lies in every case upon the party propounding a Will; and he must satisfy the conscience of the Court that the instrument so propounded is the last Will of a free and capable Testator.” Barry v. Butlin.
6. There has to be a genuine triable issue, otherwise the court has discretion to dismiss the application and grant summary judgment, and even award special costs against claimant.
7. Allegations of undue influence or fraud must be proved by the person making them .
***PRACTICE POINTRegardless of whether you wish to attach or defend a will: size of estate and possibility of costs for/against you.
TESTAMENTARY CAPACITY
Age of Capacity: 16• >= 16 & mentally capable may make a will WESA 36(1); under 16 will invalid WESA 36(2). • Exceptions:
• married• if on active duty with the Canadian Armed Forces, is a member of naval, land, air force on active
duty or is a mariner on a voyage. WESA 38(1); will only needs witnesses if signed for WM by 3d party
• Old age of capacity was 19 - new provisions apply if WM dies after legislation comes into force WESA 186.
• Note: Age of Majority Act – 19; Before April 1970 – 21.
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Test for Mental Capacity (Banks) – sound & disposing mind and memory1. WM must understand and appreciate nature of will - that it disposes of property after death.2. WM must know assets he disposes of - understand nature and extent of property being disposed -
approximate values are okay, also “lots” and “little” may suffice. 3. WM must understand and appreciate claims to which he ought to give effect, that is, those who
have an appropriate claim upon his bounty. - i.e. understand importance of disinheriting children. 4. The testator must be free of delusions that may affect his decision.
General• WM may suffer from diminished faculties (e.g. memory loss) yet still possess capacity to execute a
valid will/codicil (Royal Trust v. Rampone)• Eccentricities don’t preclude execution of valid will unless they interfere with the elements of capacity
(Bohrman).• Partial invalidity - court can sever provisions influenced by delusion while leaving instrument as a
whole intact (Bohrman). • Courts may also take into account impairment of decision-making powers due to bereavement, etc,
(Key & Anor). • For inter vivos gifts, test for capacity is arguably more stringent — taking from grantor while they may
still need the property — see test from EPOA. • 4th criteria includes moods (Sharp v. Adams, 2006). • “The burden of proving testamentary capacity is on the party trying to support the Will, but there is a
presumption of capacity where the Will has been duly executed, with the requisite formalities, after having been read by or to a testator who appeared to understand it. That presumption may be rebutted by evidence of suspicious circumstances, in which case the burden reverts to the party supporting the Will to prove testamentary capacity on the balance of probabilities (Vout v. Hay, SCC 1995).”
• There are 2 conditions that can invalidate a will: general unsoundness of mind and delusions.
Date of Capacity• Capacity is required at the time of giving instructions but lesser capacity when signing.• Full testamentary capacity may not be required at the time of execution under the following
circumstances: (Parker v. Felgate — roused from a coma to sign).1. WM had capacity at time instructions given to solicitor. 2. those instructions are incorporated into will3. WM listened to summary of will and affirmed will matches their earlier intentions.
A. General Insanity/Dementia• The will-maker’s lack of mental capacity invalidates the will. • “Merely to be able to make rational responses is not enough, nor to repeat a tutored formula of
simple terms. There must be a power to hold the essential field of the mind in some degree of appreciation as a whole …” (Menzies v. White).
• If the will-maker has necessary capacity, exclusion of those who believe they have a moral claim to the property or if the will is eccentric does not invalidate the will (Boughton v. Knight). (BN: WVA).
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***PRACTICE POINT:If client wants to disinherit someone – explain why in: the will, a letter, or statutory declaration.
Leger v. Poirer [1944] SCC – lack of testamentary capacity invalidates will “A ‘disposing mind and memory’ is one able to comprehend, of its own initiative and volition, the essential elements of will-making, property, objects, just claims to consideration, revocation of existing dispositions, and the like”F: WM’s collapse & mental deterioration preceded the will. I & H: Did she have capacity when she drew up the last will? No. A: court looked at WM’s intentions (in her two previous wills and her statements to people) when she was in good mental health. She had intended her granddaughter Yvette to inherit the residue of her estate and not her son. The will being litigated was drawn up after her mental health started deteriorating. Application: The testimony of grandniece was critical in determining that will was invalid, more so than advice of doctor.
Re Davis (1963) ON CA – evidence of capacity can also be given by laypersons • “Whether a person has testamentary capacity, i.e. whether he has a sound and disposing mind, raises a practical question
which, so far at least as evidence based on observation and experience is concerned, as contrasted with evidence based on pathological findings, may be answered by laymen of good sense as by doctors.” TJ
• “The onus of proving testamentary capacity where any dispute or doubt exists upon the matter is cast upon the proponents of the will. Where … the will is an inofficious one and constitutes a marked departure from all prior dispositions and there is a history of progressive impairment of the mental faculties … resulting in memory loss and character changes, with other evidence suggestive of mental deficiency, that burden of proof is considerably increased.” ON CA
F: WM becoming forgetful & had a personality change. She executed 5 wills, 4 of which divided her estate among her family. HVR, for her last will she instructed a different solicitor who did not inquire closely into her affairs. It left her estate to a non-existent cancer society. TJ refused to admit last will to probate & in considering evidence he gave little weight to evidence of attending physician & solicitor on grounds that it was vague & unsatisfactory. Instead, he preferre evidence of lay witnesses.
Royal Trust Co. v. Rampone [1974] – WM may suffer from diminished capacity (e.g. memory loss) yet still possess capacity to execute a valid will/codicil. F: WM voluntarily gave up running of business to estate committee b/c he was experiencing memory loss. WM later made codicil to will - gave equal share of residuary to all 6 children (up from 4) I & H: valid? Yes, An inability to manage business affairs does not preclude testamentary capacity. Evidence from lawyer & doctor wrt WM’s lucidness at time of codicil + circumstances + rational reason for changes = presumption of incapacity rebutted
Notes• WM declared incapable of managing property does not necessarily lack testamentary capacity - O’Neil
v. Royal Trust Co., [1946] SCC; Royal Trust Co. v. Rampone, [1974] BCSC.• However, WM may be regarded as sane in the sense commonly understood and yet be incapable of
making a valid will. WM may appear to be capable of exercising sound judgment & remembering names of his or her relations, but, b/c of advancing age or other reason, does not have a sound disposing mind in that, for no apparent reason, except failure of memory, deceased has not made provision for some of those who have a moral claim upon his or her bounty - Lamb v. Brown (1923) HC; Murphy v. Lamphier (1914) ON CA.
• WM may, in fact, have testamentary capacity, but fail to understand and approve of contents of will, in which case it must fail - Rhodes v. Rhodes (1882) PC.
• Conversely, WM may be able to comprehend terms of the will and yet lack capacity - Battan Singh v. Amirchand, [1948] AC.
• WM cannot revoke a will, made while sane, after becoming insane - Re Brechin (1973) AB QB.• WM who suffers from manic depressive symptom has capacity to make a will when not affected by
those symptoms - Hamilton v. Sutherland (1992) BC CA. • A person suffering from a diseased of the mind is not necessarily untestable for that reason. In
Stevens v. Crawford (2001) ABCA, TJ accepted evidence of a medical expert showing that the degree
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of cognitive impairment suffered by a WM suffering from Alzeimer’s disease had not progressed to the stage at which she could no longer give instructions for her will and execute it. The Court of Appeal held that the TJ had not ignored conclusive or relevant evidence, misunderstood evidence, or drew erroneous conclusions from the evidence.
• If you wish to contest the validity of a will for lack of capacity, you must take care not to acquiesce in its validity. If you do acquiesce, you will be estopped from raising the issue of validity later. Thus, for example, if the executors bring an application to construe a will and you do not challenge the validity of the will at that time, but advance an interpretation of the will which the court rejects. the issue of capacity is res judicator - Sigil v. Isenberg (1992) Man. QB.
• Although a person who lacks capacity cannot make a will, in NB the court has power to make, amend, and revoke the will of a mentally incompetent person, or to direct that the person’s committee do so, subject to the court’s approval - NB Infirm Persons Act.
B. Delusions
Definition• A person may be generally sane & yet suffer from delusions which affect his or her capacity to make a
valid will. • A delusion is a belief in the existence of something which no rational person could believe, and which
cannot be eradicated from the testator’s mind by reasoned argument - Dew v. Clark and Clark. – Irrational belief in a state of facts which are not true.
Requirement: Nexus• Test: Does the delusion influence the disposition of property? There has to be a reasonable
connection between the delusion and the manner of dispositions in will. • If delusion does not affect dispositions, then it does not invalidate will (Banks v. Goodfellow, - WM
had fixed delusions that he was molested by evil spirits. Absence of any reasonable connection between delusions & dispositions made by WM to niece).
• There is also authority (although criticized) which supports the view that delusional disorder may affect only part of the testamentary act. Only those parts that are gravely affected are struck out (Re Estate of Bohrmann, [1938]; Re Souch [1937] ONCA).
• Cases where presence of delusion invalidated will:• Smee v. Smee (1879) – WM’s will leaving his estate to strangers was set aside as WM falsely
believed that his brother, his nearest relative, had defrauded him of an inheritance. • Re Barter, WM believed daughter had wired his chair to give him electric shocks; • Fuller Estate v. Fuller Estate (2004) BCCA WM had delusions that children opposed their father’s
connection with a church; • Ouderkirk v. Ouderkirk [1936] SCC, WM had a delusion about the immoral character of his wife at
age 70 and his groundless suspicion that she was entertaining men for immoral purposes. • WM may be capable of transacting business even of an intricate nature, but may be incapable of
making a will if he or she has psychotic delusions towards persons who would ordinarily be considered as having a claim on his or her bounty at the time of the making of the will. This principle applies even if he or she appears to make a reasonable provision for those persons. If in fact it is proven that he or she had delusions directed towards those persons, the testamentary capacity may not be there irrespective of what he or she actually provided in the will (Montreal Trust Co. v. McKay 1957 AB SC)
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No Delusion but Suspicion or Doubt• If there is no delusion in the sense defined in the cases, but merely a suspicion or doubt, or even an
indifference about the matter, the will should be admitted to probate. • In Royal Trust Co. v. Ford, [1971] S.C.R. 831, WM’s delusion that his son was illegitimate was found to
be only a cover for not wishing to leave more of his wealth to the son. The delusion, if it existed at all, was not the cause of the limited bequest.
Proving Delusion Affected Will• When it has been shown that the testator suffered from delusions, the question whether the
delusions influenced the disposal of the property is a question of fact to be proven on a balance of probabilities (McGarrigle v. Simpson; McIntee v. McIntee; Thamer v. Jundt). The onus is on the propounder of the will.
• It is not sufficient to prove that a delusion is related to the subject matter of a disposition; the court must be satisfied that the delusion affected the disposition. (Jenkins v. Morris; Skinner v. Farquharson (1902) S.C.C.; Beal v. Henri; Fuller Estate v. Fuller (2002) B.C. S.C.; affirmed (2004) BCCA (testator severely paranoid and delusional as result of Alzheimer's disease; testator influenced by delusions which poisoned affections for his children); Weidenberger Estate, Re (2002) Alta. Q.B. (evidence indicating that deceased's delusions relating to authority and not affecting dispositions actually made)
• If the conclusion is reached that, had WM been free from a fixed idea or delusion regarding a natural object of his or her bounty, he or she would not have made the will he or she did, and that the instrument as a whole is the result of the operation of that idea upon what remained of his or her mental faculties, then the will cannot stand. (Ouderkirk v. Ouderkirk (1936) S.C.C.); Brydon v. Malamas (2008) BCSC.
• If insane delusions have been shown to exist, the burden of proving that they could not reasonably be supposed to have affected the disposition of property is upon those who support the will (Ouderkirk v. Ouderkirk (1936) SCC). The terms of the will itself may be sufficient to discharge the burden (Skinner v. Farquharson (1902) SCC). BN: Montreal Trust Co. v. McKay where delusions may invalidate a will even though its provisions are reasonable.
Banks v. Goodfellow (1870) – test for capacity & delusions did not affect disposition so will valid. WM’s delusions will only invalidate a will where it influenced the dispositions made in it. F: WM suffered from delusions that Featherstone Alexander, who was dead, was following him, as well as suffered delusions of devils and evil spirits. He executed 2 wills. The first left everything to his sister, and the last will left everything to his niece who he cared about. I & H: Was the will invalidated as a result of the testator being delusional? No. The delusions did not influence the bequest in the will and the bequest was rational. Therefore, the will was valid. Note: “In deciding upon the capacity of the testator to make his will, it is the soundness of the mind, and not the particular state of the bodily health, that is to be attended to: the latter may be in a state of extreme imbecility, and yet he may possess sufficient understanding to direct how his property shall be disposed of; his capacity may be perfect to dispose of his property by will, and yet very inadequate to the management of other business, as, for instance, to make contracts for the purchase or sale of property. For most men, at different periods of their lives, have meditated on the subject of the disposition of their property by will, when called upon to have their intentions committed to writing, find much less difficulty in declaring their intentions than they could in comprehending the business in some measure new.”
O’Neil v. Royal Trust Co. [1946] SCC – delusion must have affected disposition in will. WM who has been declared incapable of managing property does not necessarily lack testamentary capacity. There has to be a connection between the delusions and her will. F: WM executed 3 wills. 3d made while she was confined to a sanatorium, a place for the treatment of mental and functional nervous diseases. Solicitor was confident of her testamentary capacity. Psychiatrist who treated her said she had delusions that
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were not fixed. A court had made an order - akin to a BC committeeship order - declared her incapable of managing her own affairs by reasons of mental infirmity. I & H: Is will invalidated by the operation of the testatrix’s delusions? No, there was no connection between the bequests and her hallucinations and delusions. These did not affect the will, and therefore, the will is valid. A: “It is possible that a person may conduct herself in a very rational manner, even making a rational will, and still be motivated and governed by insane delusions.” “The proved hallucinations and delusions are not upon the evidence connected with the motives and reasons that led to the making of this will in question.”
Skinner v. Farquharson (1902) SCC - terms of will itself, can be used to prove delusion did not affect bequests. F: WM executed 2 wills. Earlier will left more to his wife and son. 6 months after last will was made, WM placed in an insane asylum but he was not examined for insanity. Last will was challenged by WM’s 2nd wife and son on grounds WM was subject to delusion that his 2nd wife and son were carrying on an incestuous relationship, which affected bequests. Solicitor: WM mentioned incestuous relationship but that it did not affect provisions. I & H: Was will invalidated as a result of WM’s delusions? No, tSCC: if there was a delusion, it did not affect him at the time he made his will. It seemed highly unlikely WM would have given his wife and son such generous amounts and have appointed her co-executrix and guardian of the children if the delusion perverted his mind.
Royal Trust Company v. Rampone 1974 BCSC - delusions didn’t affect disposition. WM changed will to disinherit relation in favour of another person. H: While WM had 2 particular delusions, neither influenced his disposition of property. Evidence indicated he was of sound mind in that regard. Disposition stands - delusion didn’t go to the heart of capacity requirements.
Ouderkirk v. Ouderkirk, [1936] SCC – delusions affected dispositions. F: WM had a delusion about immoral character of his wife at age 70 and his groundless suspicion that she was entertaining men for immoral purposesI & H: whether or not delusions were of a nature to affect will? WM was having delusions while executing will, it affected delusions. Will invalid.
***PRACTICE POINTSend client for medical examination if there is an issue of competence.
SUSPICIOUS CIRCUMSTANCES• Suspicious circumstances “are not circumstances that create a general miasma of suspicion that
something unsavoury may have occurred, but rather circumstances which create a specific and founded suspicion that the testator may have known and approved of the contents of the will .” Clark v. Nash.
• Extent of proof required to remove suspicion varies w/ gravity of suspicion & circumstances Clark v. Nash. Proof required increases as gravity of suspicion increased (Vout v. Hay).
• Onus: If will is challenged on basis of suspicious circumstances, onus of proof lies w/ propounder of will when arguing lack of capacity and knowledge. The onus lies on those challenging the will in respect of undue influence.
• Capacity & Knowledge – properly executed & read over and understood. • The court must be satisfied that the suspicion was removed (Barry v. Butlin).
• “First … the onus probandi lies in every case upon the party propounding a Will; and he must satisfy the conscience of the Court that the instrument so propounded is the last Wills of a free and capable Testator.”
• “Second … if a party writes or prepares a Will, under which he takes a benefit, that is a circumstance that ought generally to excite the suspicion of the Court, and calls upon it to be vigilant and jealous in examining the evidence in support of the instrument, in favour of which it
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ought not to pronounce unless the suspicion is removed, and it is judicially satisfied that the paper propounded does not express the true Will of the deceased.”
Test (PLTC)Circumstances that courts have found to be suspicious include:(a) physical or mental deterioration;(b) secret preparation of a will;(c) “unnatural” dispositions;(d) involvement of beneficiaries in will preparation;(e) lack of control of personal affairs by the testator;(f) drastic changes in the personal affairs of the testator;(g) isolation from friends and family;(h) drastic changes in the testamentary plan of the testator;(i) physical, psychological or financial dependency on the beneficiaries.
***PRACTICE POINT1. Who is the client?2. How were the instructions delivered and by whom were they delivered?3. Additions to the interview? (Important to explain to client’s family/friend/other why they can’t participate).
Barry v. Butlin – court must be satisfied that suspicion is removed.F: WM was 76 years old when he executed his will. Left approximately 1/4 of his estate to solicitor and a substantial sum to butler, and residue to Mr. Butlin, a close friend. Left nothing to his son whom he was estranged from. WM was also estranged from his other relatives. Son challenged will on basis of lack of capacity and fraud on by solicitor, executor and WM’s butler. I & H: Was the will invalidated due to suspicious circumstances? No. COMMENTS:• The rule in Barry v. Butlin extends not only to cases in which a beneficiary prepared a will, but to all cases in which: “a will is
prepared under circumstances which raise a well-grounded suspicion that it does not express the mind of the testator” - Tyrell v. Painton.
Vout v. Hay [1995] SCC – suspicious circumstances • Standard of proof requires increases as gravity of suspicion increases. • Suspicion raised by circumstances:
• around preparation of will• suggesting capacity issues• suggesting free will
• “Where suspicious circumstances are present, then the presumption is spent and the propounder of the will reassumes the legal burden of proving knowledge and approval. In addition, if the suspicious circumstances relate to mental capacity, the propounder of the will reassumed the legal burden of establishing testamentary capacity. Both of these must be proved in accordance with the civil standard … The presumption simply casts an evidentiary burden on those attacking the will. This burden can be satisfied by adducing or pointing to some evidence which, if accepted, would tend to negative knowledge and approval or testamentary capacity.” para. 27.
F: WM, Hay, was murdered at 81 years of age. He was unmarried and lived alone on his farm. His estate was worth about $320,000. In his will, made 3 years prior to death, he left one farm to Sandra Vout, - also his executrix. She was his friend and helped him w/ chores. He also made bequests to his nephew, brother, Carl Hay, and 7 nephews and nieces. Hay family
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challenged bequest to Vout and sought probate of a prior will made about 20 years earlier in which he left everything equally to his brother and his now deceased sister. • Will was prepared in the officers of Vout’s parents’ lawyers. There was conflicting evidence as to extent of Vout’s
involvement with will preparation. • TJ noted suspicious circumstances, but concluded there was capacity and suspicious circumstances were not present. CA: TJ
failed to resolve discrepancies and failed to consider suspicious circumstances, which would cast burden of disproving undue influence on Vout.
I & H: Was the will valid? Whether suspicious circumstances impose a standard of proof that is higher than the ordinary civil standard? - civil standard of balance of probabilities. Whether the reference to a free and capable testator requires propounder of will to disprove undue influence? It has to be a well-grounded suspicion.
KNOWLEDGE AND APPROVAL
General:• rebuttable presumption that WM knew and approved of the contents of the will
• applies after propounders of will prove will was properly executed after it was read to or by WM and WM appeared to understand it.
• rebutted if shown WM did not really understand contents of will even though it was read to or by the testator (Fulton v. Andrew; Re Morris).
• Suspicious circumstances, such as when beneficiary has prepared will or had been instrumental in having will prepared, can rebut presumption. Propounders must prove knowledge and approval affirmatively on BOP (Tyrell v. Painton; Vout v. Hay) — i.e. ensure court you didn’t slip a clause in giving something to yourself
• If WM failed to understand entire will, it cannot be probated. However, if WM did not understand one clause, or made a mistake about part of will only, rest of will may be probated.
• WM must know & appreciate value of estate - including residue - as well as its approximate magnitude (Russel) — general knowledge okay (Laslo).
Russell v. Fraser (1980) B.C.C.A. - knowledge of magnitude of estate/ value of residueF: Elderly WM didn’t get out much. Asked bank manager to be her executor & take instructions to lawyer to have will drawn. WM made specific bequests but did not give away her entire unable to show WM knew it, or solicitor who prepared will on bank manager’s instructions discussed size of residue with her. I & H: Valid? Did WM know of magnitude of estate? No, no indication WM knew and approved of just how much she was leaving to BM. Probate granted without residuary clause.
UNDUE INFLUENCE
LegislationWESA 52. In an action, if a person claims that a will or any provision of it resulted from another person(a) being in a position where the potential for dependence or domination of the will-maker was present, and(b) using that position to unduly influence the will-maker to make the will or the provision of it that is challenged,and establishes that the other person was in a position where the potential for dependence or domination of the will-maker was present, the party seeking to defend the will or the provision of it that is challenged or to uphold the gift has the onus of establishing that the person in the position where the potential for dependence or domination of the will-maker was present did not exercise undue influence over the will-maker with respect to the will or the provision of it that is challenged.
• At CL, undue influence = potential for exercise of power over another + actual use of that power — coercion of whatever sort (Wingrove)
• Onus lies with person alleging undue influence where will is otherwise validly executed (Craig v. Lamoureaux).
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• Burden for undue influence WESA 52• challenger has onus to establish that person was in position with “potential for dependence or
domination of WM” present.• onus then on supporter to establish that person did not exercise their advantage.
• Gifts to paid caretakers are automatically void unless approved by the PGT.
Field v. James, 1999 (BC SC) – undue influenceF: Field had 3 children with 1st wife. 2nd wife brought in a daughter of a prior marriage. Solicitor thought Field did not have capacity due to after effects of stroke. Doctor confirmed issues with capacity. Field signed new will that left negligible amounts to children and grandchildren from 1st marriage. 2nd wife had been altering his account & moving money into another account. I & H: Whether there was undue influence and whether the WM had capacity. He has capacity to draft a simple will but not capacity to draft a more complicated will. Will is invalid. Note: Blended family/second generation - challenging scenario. WM diverged greatly from first will to second will (*flags, could be challenged under WVA)
FRAUD• Gift will be valid:
• immoral/illegal conduct by a B not connected to making of a bequest will not defeat the bequest. • Policy: 1) criteria is too subjective — floodgates — may start challenging bequests 2) would
remove certainty in wills and lead to increased delay and expense. • Gift will fail:
2. There’s false assumption of character by a legatee AND3. false character motivated gift by WM4. purpose of fraud had to have been to obtain the legacy.
Bollsnstz Estate v. Simon, 2006 SKCA - Fraud must go to heart of reason for making gift. F: S named B and executor by WM. At time S was stealing from WM.H: Link not established. No reason to think gift was given b/c WM thought S was honest - could as easily have been b/c WM’s relationship with S’s mother. Bequest valid. (S withdrew as executor)
MISTAKE• Any part of will may be refused probate if inserted by mistake.• Court can strike out sections inserted by mistake but cannot substitute words of what WM intedned. • Mistakes: patent mistake on face of will, drafting error, WM executed wrong instrument.
Rhodes v. Rhodes – mistake: solicitor error in draftingHe inserted these words w/o specific instruction from WM, had no particular reason for inserted them but thought they should go into an ordinary will.
***PRACTICE POINT: Prof usually asks following 3 questions when alone with WM.
(1) Have you read and understood this to be your will?
(2) Does it accurately reflect what you want to happen to your estate?
(3) Is anyone making you do something you don’t want to do?
Summary• Knowledge of the content
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• Approval of the content• Capacity to make the Will• No undue influence• Knowledge of the assets/liabilities• Identify who is owed a moral/legal obligation
• WVA - does the person know that they have children and or spouse. If separated, how long? All the WVA talks about is spouse and issue. What if you have a grandchild who you have raised? Joint trust. You may have children who you don’t want to owe an obligation to.
Exam Answer: The test in Banks and Goodfellow is: (state the four steps). Then Ouderkirk was a case where WM having a delusions was found to invalidate the will. Therefore, I would suggest that this is or is not a valid will …
WILL FORMALITIESLEGISLATION WESA ss. 37-40 Wills Act ss. 3-6
FORMS OF WILLS1. Attested - prescribed formalities by WESA2. Holographic will - solely in WM’s handwriting3. Privileged will - military will4. International will
A. ATTESTED/FORMAL
LEGISLATION• WESA s. 37(1) To be valid, a will must be
(a) in writing ,(b) signed at its end by the will-maker , or the signature at the end must be acknowledged by
the will-maker as his or hers, in the presence of 2 or more witnesses present at the same time, and
(c) signed by 2 or more of the witnesses in the presence of the will-maker .
***PRACTICE POINTS• multiple pages should be fastened securely and numbered “X of Y”• execution ceremony - take place in private, ask aloud if WM understands contents of will etc. (have
routine questions set to use each time), everyone should be able to see other sign. • standard procedure - all 3 parties initial each page: bottom of each page and in margins next to
number values.
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• Sample will:1. Revocation clause2. Appointment of Executor - Plan A, Plan B; Joint and multiple appointments3. Transfer of property (vesting) in trust with executory/trustee4. Definitions5. Specific gifts6. Residue7. Final Wishes8. Boilerplate - Executor’s powers e.g. investment, borrowing9. Attestation Clause
CODICILRequires: reference to will (date); language of amendment/change, attestation and execution the same as a will.
CURING DEFICIENCES • WESA 58(3)Even though the making, revocation, alteration or revival of a will does not comply with
this Act, the court may, as the circumstances require, order that a record or document or writing or marking on a will or document be fully effective as though it had been made
(a) as the will or part of the will of the deceased person,(b) as a revocation, alteration or revival of a will of the deceased person, or(c) as the testamentary intention of the deceased person.
• CL: Court traditionally had no power to fix execution problem — some jurisdictions went with “substantial compliance” — but not BC (Krause v. Toni (1999) BCSC — Couple executed wills together, both attested by secretary but only husband’s witnessed by lawyer. Probate granted - CL jurisdiction. BN: Bolton v. Tartaglia (2000) BCSC - no CL dispensing power).
• Limits of dispensation power — document must’ve been intended to have testamentary effect (George v. Daly – WM gives verbal instructions to accountant, who passes them onto solicitor in letter. Solicitor wants to get medical clearance first for competency reasons. WM dies before will executed. Court: instructions not enough. No evidence WM even saw letter and intended it to act provisionally).
REQUIREMENTS1. Will must be In Writing • includes recognized forms of writing, such as handwriting, typescript and printing — Also symbols that
represent writing - Murray v. Haylow [1927] ON CA. • Statute does not stipulate what will must be written on. Quebec Superior Court held a computer will
to be valid under art. 714 of the Civil Code of Quebec, which is is a dispensing power. - Rioux c. Coulombe.
2. Signed by WM or an Amanuensis at End• (1) If someone else signs for WM, attestation clause should state this is done in WM’s presence and at
this or her request. • (2) If WM unable to read, that will was read over to WM and that he or she appeared to understand it.
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• (3) If WM makes a “mark” — precaution — have attestation clause state WM cannot write and has signed with a mark and Will was read over by WM and WM appeared to understand it (and it should be identified further by someone who is present at execution of will).
• Assistance/guidance - “If a testator, in making his mark, is assisted by some other person and acquiesces and adopts it; it is just the same as if he had made it without any assistance.” - Wilson v. Beddard (1841). (Re White (1947) As result of stroke WM unable to write signature. Mr. Binet a JP and Registrar of Deeds, who helped prepare the will, helped him to make his mark on the will. Court: Even though guided, signature was authentic. WM had necessary capacity to make will and any suspicious circumstances were removed.)
• If will signed by another person in presence of WM and at WM’s direction, how should that person sign, with his or her own name, or with WM’s? It is preferable if amanuensis write WM’s name and below it indicate that this was done by amanuensis in presence and at direction of WM. However, there is amble case authority for proposition that amanuensis may sign his or her own name (Re Deelay and Green (1929), [1930] ONCA). Amanuensis can also act as one of the witnesses (Re Baileys Goods).
• WM does not have to sign with his or her full name; a business signature is sufficient.• A signature does not have to take the form of a written signature, but may be printed if WM normally
“signs” in that fashion (Re Clarke (1982)). • A blind person can clearly make a will and sign it or have an amanuensis sign it. When applying for
probate, executors must prove WM knew and approved contents. Evidence that will was read to WM in presence of both witnesses, present at same time, and an attestation clause to that effect is desirable, but not essential. - Brewster v. Brewster (1989) Sask. Q.B..
• A mark can be a valid signature as long as it represents WM’s testamentary intention (Re Bradshaw Estate); Paraplegic WM can stamp his name instead of signing if satisfies test in Re Bradshaw (Re Clarke Estate)
• NB has a statutory wills system for mentally incompetent persons. NB’s Infirm Person’s Act contains unusual provisions, which allow that court, or committee of a mentally incompetent person with court’s approval, to make, amend, or revoke a will for such a person.
Ball v. Taylor (1999) (B.C.S.C.) – presumption of due execution in absence of contrary evidence F: If invalid, children get all on intestacy. If valid, Mrs. Ball gets most & children basically written out. I: neither witness could remember whether T’s signature was on the will. H: court presumed it was compliant. Won’t allow bad memory to upset the will as it stands. Need to have evidence of insufficient witnessing of the will.
Re White (1947) NSSC – guided signature validF: WM suffered a stroke in 1944. As a result, his power of speech was permanently affected and he required assistance in feeding and clothing himself. The testator was unable to write his signature and so Mr. Binet a JP and Registrar of Deeds, who helped prepare the will, helped him to make his mark on the will. The appellant contested the will. I & H: Since the signature was guided, was the execution proper? Signature was authentic. WM had necessary capacity to make will and that any suspicious circumstances were removed. Admitted to probate.
Re Bradshaw Estate (1988) NB – test for making a mark instead of signing(1) were markings on will made by WM?(2) were they intended as his signature and to represent that WM could do by way of writing his name under his physical
circumstances. F: WM on deathbed, pen was placed in his hand and he tried to sign it. Made three strokes on the paper then died. I: validly executed? H: yes. Intended to sign, but was unable due to physical infirmity. Best he could do under the circumstances.
***PRACTICE POINT
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Sample: “We were both present, at the request of JOHN BLACK, when this Last Will and Testament was read over to him. He appeared to thoroughly understand it and approve its contents. We remained present while he signed this Last Will and Testament. We then signed as witnesses in his presence.”
Signature Placement (At the end of the will)• WESA 39 (1) – court will construe will as being signed properly if WM intended to give effect to will.
But not if WESA 39(2) – gift/direction follows signature or if gift/direction inserted after WM signed. • incorrectly placed signatures (Re Riva (1978) Instead of signing on 3rd page under attestation clause,
WM signed on 4th page (back of will) in place reserved for date of signature and envelope. No evidence whether failure to sign will was purely accidental. Will valid even if signature incorrectly placed — WM intended document to be last will and testament.)
• validity of signature on envelope containing will. Valid - Re Wagner; Re Riva. invalid - Re Bean [1944]; Re Beadle [1974]
• Principle of omnia praesumuntur rite esse acta. • Signature would normally appear opposite and to right of attestation clause. However, if signature
only appears in attestation clause (in the place where it is normally typed) will is valid. - Cook v. Nova Scotia (1982); Jung v. Lee Estate (2008) BCSC. But if will is signed and witnessed first and then WM completes dispositive part of will, it must be refused probate - Kennedy v. MacEachern (1978).
• If WM’s handwritten name appears at top of will, but not at end, and she did not acknowledge her signature to witnesses, and they did not see her sign, will cannot be probated. - Ellis v. Turner (1997) BCCA.
• There is a presumption of due execution when will contains a proper attestation clause (Kirpalani v. Hathiramani (1992) Not Gen Div; Beniston Estate v. Shepherd (1996), BCSC). The presumption will be applied, even if there is inconsistent evidence about whether the will was completed before it was signed and attested, so long as there is credible evidence proving that it was completed. (Jung v. Lee Estate (2007) BCSC).
Re Wagner (1959) – placement of signature – expression “on the face of the will” does not exclude a signature on envelope. F: unsigned will placed in envelope; envelope signed by testator in presence of attesting witnesses; probate granted.
4. Attestation – Signed in presence of each other• Requirement that witnesses sign in presence of WM does not mean witnesses need to see what WM
writes, or even that the document he or she is writing on is a will. So long as they see WM write something on will, court will apply the presumption omnia praesumuntur rite ease acta and presume WM wrote his or her signature. - Smith v Smith (1866).
• Witnesses must see WM sign, and WM must see both witnesses sign.
Chesline v. Hermiston [1928] ONSC – witnesses must see WM sign or write something in will. R: “The signature of the testator must be written or acknowledged by the testator in the actual visual presence of both witnesses together before either of them attests and subscribes the will”F: WM, Hemiston entered Mr. Petrie store and asked him to witness a document which he said was an explanation of his income tax return. He had brought with him another witness, who signed and saw the other witness (Petrie) start to sign and left before witnessing the testator’s signature. I & H: Do witnesses need to know they are attesting a will? No, as long as they see the testator sign and they sign after the testator signs. “a mere request to witnesses to attest an instrument, the nature of which is not explained to them and the signature of which they do not see, is not sufficient.”
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Bolton v. Tartaglia (2000) BCSC – F: WM initialed first 2 pages of her will and signed last page in presence of 2 witnesses. Both witnesses initialled first 2 pages and one witness signed last page of will. Other witness inadvertently did not sign last page. H: Failure to comply with statutory requirement that 2 or more witnesses must subscribe will in presence of WM meant that the will failed. Note: This case was before WESA gave court dispensing power.
Acknowledgement• If WM has signed will out of presence of witnesses, s. 4 of Succession Law Reform Act requires WM to
acknowledge signature in presence of both witnesses, present at same time. Witnesses must then sign will in WM’s presence, although not necessarily in each other’s presence.
• Witnesses need to see signature for there to be acknowledgement after WM has signed will - Re Gunston (1882) WM wrote out will by hand, asked witnesses to come in to attest document. They saw her laying down her pen, did not know what the document was and neither of them was able to see signature and writing above it. Invalid acknowledgement).
• Witnesses need not actually see WM’s signature, so long as they had an opportunity to see it - Brown v. Skirrow [1902].
By Beneficiaries and Others
• Where a will is witnessed by a beneficiary or the spouse of a beneficiary - there is potential for fraud - gift is voided.
• WESA 40(1) Witness must be 19 and +
INCORPORATION BY REFERENCE• Another doc may be incorporated into will if referred.• Requirements (Re Jackson):
1. Doc must exist when will is executed;2. Will must refer to doc;3. Will must describe doc w/ certainty.
Re Jackson [1985] (B.C.S.C) – incorporation by referenceF: Wrote will, then wrote memo several days later. Memo said will referred to it, but it didn’t. Memo was a list of effect she wanted to distribute to certain ppl after her death. Signed at end, witnessed etc. in accordance w/ Wills Act. 3 years later, new will. Refers to memo this time, but no new memo. So, either they forgot to make a new memo, or they misdated first memo. I & H: could they use parol evidence to determine which memo was referred to by will? yes; b/c that memo was only one in envelope w/ will, it was admitted to probate w/ will. Requirements stated: 1. Must be in existence at time of execution; 2. Must be described as existing; 3. Capable of being ascertained; 4. Will must not state that doc must not form part of it.
B. HOLOGRAPH WILLS• A holograph will is one written entirely in WM’s own handwriting and signed by him or her. It does not
require attestation. • Currently not legal in BC (though may be validated under WESA 58 which gives judge’s discretion to
make an order validating a will).
A Deliberate or Fixed and Final Intention
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• A testator must intend to make a will and give expression to his or her deliberate or fixed and final intention to do so. Since holograph wills are usually informal documents, however, such an expression is often lacking.
• In order to be testamentary, a holographic will must contain a deliberate or fixed and final expression of intention regarding property disposal upon death and the onus is on the propounder of the will to demonstrate this intention either by reference to the document itself or using extrinsic evidence. - Whyte et al. v. Pollock (1882); Godman v. Godman, [1920]; Theakston v. Marson (1832).
• As long as WM has a deliberate and fixed and final intention to make a will, doc will be admitted to probate. Then fact that WM intended to see a lawyer about her testamentary disposition afterwards does not mean that doc constitutes instructions only - Janicki v, Janicki (1997) Man. QB; Dilts v. Roman Catholic Episcopal Corp. of the Diocese of London in Ontario (1998) ON. Gen.
• In jurisdictions that have a dispensing power, doc cannot be probated unless it is shown that it incorporates deceased’s fixed and final intention to make a will - Kavanagh Estate v. Kavanagh (1998)
• Written instructions do not constitute a Will (Canada Permanent Trust Co v. Bowman).
Bennett v. Gray [1958] SCC – Letter outlining bequests & asking solicitor to prepare will not deliberate & sufficiently testamentary in nature. F: WM wrote letter to her solicitor advising of how she wished to dispose of her property. She committed to meeting him upon her return from Winnipeg. She could not decide on her executor and died without executing a proper will. TJ held the letter to be a valid holograph will, Manitoba CA reversed it, and the SCC upheld that judgement. I & H: Can letter serve as valid holograph will? Is it in substance testamentary? No, letter not written animo testandi. No intention for letter to be a testamentary document.
Canada Permanent Trust Company v. Bowman [1962] SCC – As long as WM has a deliberate and fixed & final intention to make will, doc admitted to probate. F: Deceased left a doc in her own handwriting & signed by her, which laid out bequests - referred to gifts specifically as bequests. I & H: Deceased had expressed a deliberate & fixed & final intention to make a will and doc was admitted to probate.
Use of Printed Wills• Problem - doc not entirely in WM’s handwriting. While possible in some circumstances to admit only
handwritten portions to probate, this is not automatic - Re Forest (1981) Sask. C.A. • Handwritten portion may be severed from written part & admitted to probate if by themselves
portions formed a complete expression of WM’s intentions - Sunrise Gospel Hour v. Twiss (1967) ABCA. BN: Re Philip.
• A dispensing power will not save a will written on a printed form, unless the written portions embody the testator’s testamentary intentions - Re Balfour Estate (1990) Sask Q.B.
Re Forest (1981) Sask C.A. – online will kit – handwritten portions not saved b/c lacked dispositive words. F: WM used online will kit and filled it out. But did not have it witnessed. H: First, will invalid. Second, handwritten portions could not constitute a valid holographic will for, amongst other things, they did not appoint an executor or dispose of residue of his estate. “it must be possible to find valid a testamentary document on the written words alone. However … the handwritten words must include words of disposition.”
Formalities• The formalities of execution of a formal will are, inter alia, that it be signed at its end by the testator
or by someone authorized by the testator and in his or her presence. Do these requirements apply to holograph wills?
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• In Re Tachibana (1968) Man. CA and Re Williams [1973], court held that it did not; in Re Clarke (1982), court held that it did.
• Re Wood v. Smith [1992]: English CA held WM’s name written by him at top of a holograph will, was capable of being a signature even though it is not WM’ usual signature, provided he indicated to witnesses that he regarded name as his signature and thereby showed that he intended to give testamentary effect to doc. Court also held signature does not necessarily have to be written after dispositive provisions have been written, so long as both are written as part of one operation. Will failed for want of proof of capacity, however.
• A person who lacks the capacity to manage his or her affairs may be able to make a valid will since the latter action involves different cognitive functions than the former. Thus, a person who made and signed a holograph will was held to have capacity to make it even though he did not have capacity to manage his affairs - Re Weidenberger Estate (2002) AB QB)
Re Clarke (1982) – if holograph will included in wills legislation, requirements apply. F: WM wrote his name at the end of heading instead of at end of doc. I & H: Does requirement WM sign at end of will also apply to holograph wills? If wills legislation specifically includes a holograph will w/in meaning of will & explicitly invalidates any will not having a signature at end of will, holograph will will be valid if it is missing a signature at end of will.
Holograph Codicils to Formal Wills• Holograph codicil can be used to amend a formal will - Re Chapman (1959). • However, although a holograph codicil may amend a formal will, in order to do so it must manifest a
present intention to change will; expression of a future intention to do so is insufficient - Re Kinahan (1981); Ont. Surr. Crt.; Facey v. Smith (1997) Ont. Gen. Div.
Incorporation by Reference of Non-Holograph Documents• doctrine of incorporation by reference permits an existing document to be incorporated into a will if it
is properly identified in the will. Does it apply to holograph wills?• It cannot be one document - has to be a will that references another document - Re Dixon-Marsden
Estate. But doctrine does not require 2 sheets of paper - Doe d. Williams v Evans (1832). • An earlier document cannot be incorporated in a later document if the later document does not refer
to the earlier - Simms Estate v. King (1995) Nfld. T.D.).
Re Dixon-Marsden Estate (1985) Ontario Surrogate Court – handwritten portions must be able to on their own to be submitted to probate, before it can incorporate by reference. F: WM’s alleged will consisted of a typewritten, single sheet of paper, which contained dispositive provisions and appointment of an executor. He had initialled each paragraph, written date on top right corner of page after it was typed, at bottom he had written “the above-mentioned are in short those to whom my estate is left”. Immediately below that appears his signature and his name. I & H: A holograph will has to be handwritten. But can it incorporate typewritten words by reference if reference is in WM’s own handwriting? No, it is one document and not two, handwritten portion cannot be submitted to probate on its own, and it does not meet statutory requirement.
Re Brown Estate, 1954 - acknowledgement, order of signatures. Will must be signed by WM before it is subscribed by witnesses. Witness need not sign in front of each other, although it is usual to have them do so. Will must be acknowledged in front of 2/more witnesses, not signed in front of one and acknowledged to another witness. F: Pre-printed will form filled in in handwriting & signed & witnessed on 1st 4 pages. Not a holograph will b/c of printing. H: If legislation provides for execution of will, will failing to meet statutory requirements is not valid. Only 1st 4 pages could be probated.
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C. PRIVILEGED WILLS• privileged will - made by a member of the armed forces• Does not have to be executed w/ same formalities as formal will and which is made by a member of
armed forces while on active duty or by a sailor while at sea or in course of a voyage. • Power to make a noncupative (oral) will of personalty is retained for soldiers and seaman in Nova
Scotia, and for sailors, fishers and armed forces volunteers in Newfoundland. • What is “active military service”?• What is “at sea”? Awaiting orders to join ship is not “at sea” - Re Rapley’s Estate; Rapley v. Rapley
[1983]. • Privileged will remains valid even though active service or voyage ends (Re Booth, [1926]); it may be
revoked by an informal act while privileged situation continues, but must be revoked by formal act thereafter (Re Gosage, [1921]); it is revoked by marriage (Re Wardrop, [1917]); and alterations made w/o attestation are presumed to have been made during a privileged situation (Re Newland, [1952]).
Re Booth [1926] – privileged will remains valid even though active service or voyage ends - unless revoked. F: WM leaving for active duty to Egypt and made out a holograph will which was witnessed by Pay Sergeant just prior to embarkment. Will was subsequently destroyed in a fire, many years after WM returned. After WM’s death widow sought to establish will. I & H: Was will a privileged will and did WM acquiesce to its destruction? Yes, will was a privileged will b/c WM was ‘mobilized’ - personally involved in active military service. WM did not intend for his will to be destroyed, and so will was admitted to probate.
D. INTERNATIONAL WILLS• If WM has assets in other jurisdictions, do they want this will to be their only will? • Convention Providing a Uniform Law on The Form of an International Will - 1973 - provides for
international wills. • International certificate – 3 witnesses one of whom is a lawyer.
TESTAMENTARY GIFTSTESTAMENTARY, LAPSE, ABATEMENT, ADEMPTION, ENCUMBERED GIFTS
GENERAL• WM can dispose of all property he has except for: property owned in joint interest, life estate,
contingent interest that is personal to him or her. • WM can only dispose of an interest in property, which must exist at time of WM’s death, but may be
either a vested interest or a contingent (but continuing) interest. • HVR, WM may NOT dispose of an expectancy or, a spes successionis . An expectancy is something that
WM hopes to receive but may not. E.g. hope of inheriting property. • Rule: B under will has no interest in property given by will, but only hope of succeeding to it, even if
WM is in articulo mortis (at point of death). Expectancy is not property (Del Grande (Litigation Guardian of) v. Sebastian).
• Types of testamentary gifts:1) Devises – gifts of real property (never demonstrative gift)
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2) Bequests – gifts of personalty 3) Legacies – gifts of money or money equivalents e.g. co shares.
• Categories of gifts (To determine that class – depends on WM’s intention):• Specific – gift out of a particular fund alone• General – no special fund is pointed at for payment • Demonstrative – gift where a particular fund is pointed out as primarily applicable, but where the
gift is not to fail by failure of the particular fund• Residuary – residual estate
• Specific gift adeems when its subject to will and to any statutory provisions to the contrary, the beneficiary will receive nothing. Abatement is pro rata reduction of gifts when there are insufficient funds in the estate to pay the debts and gifts in full.
• A devise (gifts of real property) can be general, specific, or residuary but not demonstrative. • Contractual obligations (e.g restrictions on share transferability) do not prevent a person from
bequeathing property by means of a will (Frye v. Frye Estate (2008)).
GENERAL AND PECUNIARY GIFTS• General legacy – payable out of general assets of estate – direction to PR to pay/transfer assets
described to legatee. E.g. a watch to each of 20 grandchildren (Direction to PR to go buy watches).• Pecuniary legacy – gift of money payable out of general assets of estate e.g. gift of money. • Context of the will and admissible evidence may show that bequest was intended to take form of a
specific bequest e.g. use of “my” (Re McLean).• Shares
• Bequest of shares is prima facie general (Re Miller). • If WM does not own assets disposed of by a general legacy, legacy is, in effect, a direction to PR to
acquire assets, if they are available, and to give them to legatee, unless latter wishes to have value of assets instead (Re Miller).
• Legacy of shares/stock - presumption - prima facie general. Presumption not rebutted merely b/c WM possessed precise amount of stock or shares specified at date of will – (Re Willcocks)
• Direction to PR to purchase annuity for B • Normally a general legacy & annuitant is entitled to demand money be paid to him or her instead.
Irrelevant if WM provided that annuitant may not have value of annuity and so is the fact that WM provided for a gift over to issues of annuitant if he or she should die before all benefits under annuity are paid – (Lotzkar v. McLean).
• Exception: If WM directs trustees to purchase a Government of Canada annuity, annuitant is required to take annuity, since Government Annuities Act makes property in an annuity purchases thereunder benefits arising therefrom inalienable. – (Re Boxall; Jensen and Cunningham v. Wutzky).
• If annuitant dies after having already received annual payment, annuitant’s estate must reimburse prorated amount that was overpaid. – ( Reid v. Richter ).
• Bank account• Gift of money in a named bank account - e.g. “my account in the Bank of Montreal” is a general
legacy (Re Heilbronner). • Gift of a specific account - e.g. “my account no. 3789-271 in the Bank of Montreal at King and Bay
Streets, Toronto” is a specific gift – (Re Ashdown).
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• If $ is withdrawn from account, specific gift adeems, but not if $ is redeposited in another branch of the same or a different bank, unless it is put in a different name, such as a joint account – (Re Ashdown; Re Brekken; Penn v. Burtness).
Frye v. Frye Estate (2008) ONCA – Contractual obligations no bar to bequeathing property by means of a will. F: Both the letters patent of corporation & shareholders’ agreement restricted transfer of shares held by members of a family. One shareholder bequeathed his shares to his sister, another shareholder, giving her effective control of corporation. I & H: Bequest may have been breach of K, but was not void. Deceased’s estate trustees, one of whom was sister, became registered shareholders of shares. Further, they held the shares as bare trustees for the sister and were, therefore, requires to exercise the rights associated with the shares in accordance with her directions.
Re Miller [1927] ONSC – If WM does not own the assets disposed of by a general legacy, legacy is, in effect, a direction to PR to acquire assets, if they are available, & to give them to legatee, unless latter wishes to have value of assets instead.F: WM bequeathed shares of O’Keefe Brewery Company of Toronto Ltd. to each Protestant Minister. Company was sold to O’Keefe’s Beverages and renamed O’Keefe’s Holding Company Limited. WM held an interest in O’Keefe’s Beverages through another holding company. Shares of Holding company were held by 4 people when WM died and they did not want to sell it. WM did not own any of the shares. I & H: How should will be construed since WM did not own the shares? Gift of shares was a general legacy. Since executors cannot buy shares at a price which represents their value, they can give money. Executors have discretion what type of stock to buy.
Re Willcocks, [1927] – A legacy of stock or shares is prima facie general. The presumption is not rebutted merely because WM possessed precise amount of stock or shares specified at date of will. F: WM bequeathed a specific amount of stock to her father and her mother. At the time will was executed, she owned exact amount of stock which she bequeathed her parents. HVR, she later sold this stock & invested proceeds in real estate. If legacies were specific, they would have adeemed. I & H:The stock was general. The fact that the testatrix, in giving the residue of her estate to her husband, described it as “the remainder of my real and personal estate”, did not show a contrary intention, since that is a typical expression used in the disposition of residue.
Re McLean (1969) NBCA – Context of will & admissible evidence may show that bequest was intended to take form of a specific bequest e.g. use of “my. F: WM owned a substantial block of class A & class B shares in a limited company. By his will he made several individual bequests of those shares and then he bequeathed “the balance of my class B stock” in the Company. Individual bequests were not preceded by the possessive pronoun “my” and there was no disposition of the remaining class A shares. I & H: Use of the pronoun “my” rendered the bequest of the class B shares specific. HVR, it was unlikely that WM intended one gift to be specific and one general. Hence, bequests of class A shares were also specific. Result was that bequests deemed, since WM had sold the shares before his death.
DEMONSTRATIVE GIFTS• A demonstrative gift is a gift of a specified amount or quantity which is directed to be satisfied
primarily out of a particular fund or asset . A demonstrative legacy is treated as a specific legacy to the extent it does not abate if the fund out of which it is payable is adequate to satisfy it, until the estate out of which the general legacies are payable is exhausted.
• If, however, the fund out of which the demonstrative legacy is payable has ceased to exist/insufficient, the gift does not adeem, but is treated as a general legacy (Walford v. Walford).
• If gift is to be paid solely out of a fund it is a specific legacy (Culbertson v. Culbertson). • A legacy of $5,000 to be paid out of the proceeds of the sale of a farm which the WM directed to be
sold is a demonstrative legacy. Hence, if the sale realizes less than the amount of the legacy, the legatee ranks with the general legacies for the balance of the $5,000 (Re Tomlin).
Re Webster’ Gross v. Webster [1937] – demonstrative gift
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F: WM bequeathed 3,000 to his eldest son, “to be paid to him out of the share of my capital and loans in the business of Webster & Bullock.” WM had been a partner in a firm. Remaining partners had right to liquidate share of a retiring or deceased partner and to pay in 4 equal quarterly instalments w/ interest at 5%. WM owed about 2,000 pounds to firm. It was possible that his interest of 5% did not amount to 3,000 and might amount to nothing at all. TJ held gift was specific. I & H: Is the bequest a demonstrative or specific gift? – Demonstrative gift. Court construed the words to mean gift was “to be paid to him primarily out of the share” instead of “to be paid to him only out of the share of the capital and loans”.
SPECIFIC GIFTS• Specific gift - gift of identifiable property or object which WM has described with sufficient
particularity to distinguish it from his or her general estate. • The fact WM did not own asset described when he or she made will does not make it a general gift. • A specific legacy is subject to ademption. If specific property given by will no longer exists at WM’s
death, b/c it has been destroyed, sold, given away, or has otherwise disappeared, subject matter of gift is gone and B receives nothing – (Mountain v. Mountain; Re Ross).
• CL: Specific gift does not abate until residue & general estate out of which general and, if necessary, demonstrative legacies are to be paid, is exhausted – (Lindsay v. Waldbrook; Pager v. Leapingwell).
• Bequest of a bank savings certificate, identified by number & face value is specific. Hence, if WM has cashed it, it adeems, even though he or she replaced it with another certificate (Re Hubert).
• Addition of word “my” or similar possessive pronoun – suggests specific gift. e.g. “my stock” (McLean). • Direction by WM to sell certain specific property and to pay a number of legacies out of proceeds is
normally a specific gift, unless legacies are not payable solely out of the fund (in which case it would be demonstrative) (Page v. Leapingwell). If aliquot portions of the fund or specific amounts are given to named legatees, the gifts to the latter are general.
• In order to be effective specific gift must describe property correctly. On the other hand, if gift is a right of first refusal to purchase WM’s farm, but mechanism to determine value is defective, court will substitute a workable mechanism (Re Malpass).
• Beneficiary of a specific gift can be determined by lottery. e.g. bequest of diamond ring by lottery (Bowen Estate v. Bowen).
• Specific gift of all WM’s money she possessed at her death does not include what she would be entitled to under the sister’s unadministered estate, since those assets did not form part of her estate at her death. Moneys she would have become entitled to from her sister’s estate when it was administered would, therefore, fall into residue (Mulligan v. Hughes).
Culbertson v. Culbertson (1967) SKCA – If gift is to be paid solely out of a fund it is a specific legacy. It does not form part of the residue. WM intended gift to be specific.F: WM gave 31 legacies in varying amounts to certain named persons & charitable organizations. Then stated: “I direct that each of the above legacies shall be paid out of the money realized from the sale of my farm lands, and if the amount... should not be sufficient to cover the full amount of the said legacies, then each person shall take a proportionate share.” – The specific gifts were payable from farm proceeds but fund was insufficient. Payment for land was made in installments, of which only a little more than $9,000 was left to be paid. Proceeds had been deposited into a bank account but due to subsequent transactions, it was difficult to discern what portion of the proceeds was left. I & H: 31 legacies are payable out of balance of the sale price of the farmlands, remaining payable at death of the WM, and each shall abate pari passu as required. A: “Language used by WM, given its natural & ordinary meaning, limits payment of the legacies to the fund to be realized from the sale of his farm lands. To place upon the words of the T an interp he intended the legacies to take effect out of some other of his property if the fund is inadequate would defeat his direct & specific instructions that the legacies abate if the fund is deficient. By reading the two paras together & giving the language its natural & ordinary meaning, the legacies constitute a bequest of the specific fund to be realized from the sale of T's farm lands to the amt of the bequests: If the fund is deficient, the legacies abate; if the fund exceeds the amt of the legacies, the excess falls into residue.”
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RESIDUARY GIFTS• Residuary gift - “the rest of my estate”, “all my property” - estate that has not been disposed of after
general, demonstrative, and specific gifts are satisfied. • “all the rest and residue of my estate, consisting of money, promissory note or notes, vehicles and
implements” may be held to pass other property as well, such as a lapsed gift of real property, if the context supports such construction (Re Farrell)
• All specific gifts which fail because of a lapse, perpetuities, the operation of the statutory restraints on alienation, or for any other reason fall into residue (Re Smith; Re Grenier) in the absence of contrary intention.
• If entire gift of residue fails (or even part of it) — intestacy laws — but courts usually apply presumption against intestacy if will permits if to prevent intestacy (Re Archer; Re McKittrick).
Professor’s Examples: • “I leave $50k to my daughter Brandi from the net sale proceeds of my business Super Bingo dabbers.”
Type of gift = legacy; Class of gift = demonstrative. • “I leave $50k to my daughter, B, from the net sale proceeds of my business Super Bingo dappers. If
there are not sufficient funds then I direct the remainder to be paid from the general reside of my estate.” Type of gift = legacy; Class of gift = demonstrative.
• “I leave the net sale proceeds to a max of $50k to my daughter, B, from my business Super Bingo dappers. Any funds in excess shall form part of the general residue of my Estate.” Type of gift = legacy; Class of gift = specific.
• “I leave the net sale proceeds to a max of $50k to my daughter, B, from my business Super Bingo dappers. Any funds in excess shall form part of the general residue of my Estate. If there are not sufficient funds then I direct the remainder to be paid from the general residue of my estate” Type of gift = legacy; Class of gift = demonstrative.
***PRACTICE POINT• When consulting w/ client who wishes to give a specific gift, discuss whether compensation in lieu of
the item is appropriate. • Before asking the question consider for yourself the nature of the gift. E.g. great grandpa’s watch v.
shares of Apple.
ABATEMENT
Legislation• WESA 50(2) -- if estate is insufficient to satisfy all gifts and debts they will be reduced• WESA 50(4) -- land & personal property must be reduced together• WESA 50(5) -- assets will be reduced in the following order
(a) property specifically charged w/ debt or left on trust to pay a debt(b) property distributed as an intestate estate and residue(c) general (ex/ 100 shares), demonstrative (ex/ $25k from my BMO account), and pecuniary (ex/
$25k) legacies(d) specific legacies (ex/ my car, funds in my BMO account #1234, my house located at 1234 Easy St)(e) property the WM had power of appointment over
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General• Abatement - pro rata reduction of the amounts or quantities of testamentary gifts when the estate is
insufficient to pay the debts and gifts in full. Absent a contrary direction in the will, the order in which assets are liable to pay debts is determined by well-defined rules.
• CL Abatement order: (1) residuary personalty; (2) residuary real property; (3) general legacies, including pecuniary legacies from residue; (4) demonstrative legacies; (5) specific bequests of personality; (6) specific devises of real property (Re Smith Estate).
• If WM directs sale of property for specific amount, or not less than specific amount, and gives certain legacies out of proceeds which are less in total than amount specified, and then gives balance of the proceeds to another legatee, latter gift is also a specific legacy and abates pro rata with the others if the property is sold for less (w/ court’s approval) than stipulated by WM (Page v. Leapingwell).
• If legacies payable solely out of specific fund, such as proceeds of sale of land, - specific &, as Lindsay v. Waldbrook holds, they must abate rata among themselves if fund is insufficient. Hence, may be general legacies payable out of other assets would take priority to specific legacies in such circumstances.
• In Canada, a legacy to executors “for their trouble”, although a general legacy, has priority over other general legacies and does not abate with them (Boys Home of Hamilton v. Lewis) even though legacy is more than what executors might otherwise be entitled to demand (Anderson v. Dougall).
• Forgiveness of debt may be treated as specific legacy & thus not liable to abate before general legacies exhausted (Re Wedmore) BN if necessary debt may be called in to pay for WM’s debts.
• In contrast, legacy given by a WM in satisfaction of a debt owed by him or her is a general legacy and, as such, is liable to abate with other general legacies (Re Rispin). Legacy is usually substantially more than debt. Creditor is then required to elect to take either the legacy or press his or her claim as a creditor. If he or she does the latter, the debt will be paid in full but, if the former, it may not be.
• Beneficiaries are usually entitled to receive interest on their gifts, if these are not paid immediately. Interest starts one year after WM’s death.
Lindsay v. Waldbrook (1897) ONCA – Need clear language on face of will to show contrary intention re abatement. F: Robert Waldbrook set out 5 legacies to be paid out of proceeds of sale of farm. There was insufficient funds to satisfy all gifts.I & H: Did grandson’s legacy take priority over other 4 or should all abate in proportion? WM did not display an intention in Will to treat one gift differently in respect of priority over other 4 legacies. Thus, only clear language to effect WM’s intention to give one general legatee priority over another will allow for avoidance of pro rata approach to abatement.
ADEMPTIONGeneral• Ademption - when property which is the subject matter of a specific gift, although in existence at the
date of the will, is not in the WM’s estate at his or her death. • RULE: If a specific gift is adeemed the beneficiary received nothing.
Legislation• WESA 48(2) -- where will makes gift of specific property & that property is sold by a nominee (not WM
- someone acting for them after loss of capacity) -- B is entitled to receive an amount from the estate equivalent to the property that was disposed
• WESA 48(3) -- override provision - (2) doesn’t apply if disposition made to facilitate WM’s instructions made while capable, absent contrary intention
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Re Hunter (1975) ONSC – F: WM devises & bequeaths house & contents. House is destroyed by fire in which WM dies. Specific beneficiaries were also residuary beneficiaries. I & H: Are Bs entitled to the proceeds of the insurance? No. Gift of house adeems. Insurance proceeds, are to be treated as personality, and after payment of debts goes to residue of estate.
LAPSE & SURVIVORSHIP General• A gift to a beneficiary who predeceases WM fails or lapses. • Exceptions: statutes etc. • WM can avoid a lapse by making a substitutionary or alternative gift by naming an alternative B to
take if first one should predecease him. • Disposition of lapsed gift - lapsed devise of real property devolved upon heir, whereas a gift of
personal property which lapsed fell into residue (Wright v. Hall). Rule concerning personal property was adopted in Canadian law.
• If no residuary gift or if gift was residuary, property passes to persons entitled on intestacy (Re Stuart). • If share of residue is given to 2 or more persons as joint tenants and one predeceases WM, remaining
person takes the property by survivorship (Re Hutton).• Lapse does not apply to class gifts (see Milthorp & Re Hutton)
Legislation• WESA 44 -- property not disposed of by will distributed to those who would take as if intestate• WESA 46(1) -- if gift doesn’t take for whatever reason it’s to be distributed according to the following
priorities (absent contrary intention)a. to alternate B’s of the giftb. if the B was the brother / sister / descendant of the WM -- to their descendants
• Survivorship Law Reform Act. s. 23: Except when a contrary intention appears by the will, property or an interest therein that is comprised or intended to be comprised in a devise or bequest that fails or becomes void by reason of,
A) the death of the devisee or donee in the lifetime of the T; orB) the devise or bequest being disclaimed or being contrary to law or otherwise incapable of taking effect,
Is included in the residuary devise or bequest, if any, contained in the will
Re Stuart (1964) BCSC – Lapsed residuary gift does not get redistributed as part of the residue of the estate, but the share is disposed of according to the laws of intestacy. F: WM gave 36 pecuniary legacies, including one to niece Annabelle. Residue divided equally among 13 people included A. A predeceases WM. The specific bequest lapses. I & H: What happens to A’s share? A’s share goes into intestacy b/c gift of residue is not specific gift. Whether s. 22 of Wills Act in respect of lapsed residuary devises or bequests applies equally to lapsed devises and bequests in both specific and residuary bequests and devises. Yes.
NOTES:A’s share of residue is redistributed to others in class if any, if no class, intestacy unless contrary intent. • If collection of persons in the residue clause was of a definable ‘class’ A’s share would be
reapportioned amongst remaining members of class; if not, share distrib according to intestacy rules. Here, no class.
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• “Since the will doesn’t dispose of A’s lapsed share & since s.22 does not … provide for the disposition of lapsed residuary devises or bequests, A’s interest passes as on an intestacy.”
Anti-Lapse Legislation• WESA 46 (1) If a gift in a will cannot take effect for any reason, including because a beneficiary dies
before the will-maker, the property that is the subject of the gift must, subject to a contrary intention appearing in the will, be distributed according to the following priorities:
a) to the alternative beneficiary of the gift, if any, named or described by the will-maker, whether the gift fails for a reason specifically contemplated by the will-maker or for any other reason;
b) if the beneficiary was the brother, sister or a descendant of the will-maker, to their descendants, determined at the date of the will-maker's death, in accordance with section 42 (4) [meaning of particular words in a will];
c) to the surviving residuary Bs, if any, named in the will, in proportion to their interests.• “Gift" includes
(a) a beneficial devise or bequest, and(b) an appointment affecting property other than the appointment of a person as executor of the will;
• Residue of estate: WESA 44 If a will does not give or otherwise dispose of all of the will-maker's property, the property that is not the subject of a gift or otherwise disposed of in the will
a) must be distributed to the persons who would be entitled if that property were an intestate estate, and
b) if there is no person who would be entitled under paragraph (a), passes to the government and is subject to the Escheat Act.
• Anti-lapse provisions can be “contrary intention” required to keep gift from lapsing. • E.g.: “In the case of the death of any of my B’s having left issue, before or after this will, I direct that
the issue shall take their parent’s share…”• WM’s can’t completely exclude the application of lapse, but they can avoid its consequences by
providing substitute B’s (Re Greenwood)
Re Wudel AB - lapseF: WM had 8 children - one predeceased leaving 4 kids. Will made 17 years after daughter’s death. Wills Act said that if gift was to descendant, it didn’t lapse, but rather went to that person’s descendants - subject, of course to contrary intention.H: Court found contrary intention.
Trebett v. Arlotti-Wood (2004), BCCA - specific giftsF: WM left contents of RBC account to B. Few weeks later, contents transferred to account at MW - adeemed? I & H: Specific gifts NOT adeemed if they’ve changed “in name or form only” - but remain substantially the same thing - unless the B can identify the particular property in the new account via tracing, they won’t take
Milthorp v. Milthorp B.C.S.C. - clear intention to create classR: Lapse does not apply to class giftsF: WM leaves estate “to my daughter X and son Y and to my husband’s kids A, B, C, D, E, and F, in equal shares per stirpes”. D predeceases (no kids) + E&F predecease (kids & gkids) I & H: Residue equally divided b/w surviving kids as class gift or do issue of E&F take their share? No class gift - wording unclear
***PRACTICE POINTdrafting technique: “In the event that any of my Estate should remain undistributed in the hands of my Executor, I give, devise, and bequeath it as follows: ½ to my brother X, and remainder to my brother Y.
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VESTED AND CONTINGENT GIFTSProperty Law Refresher:
Grantor gives what to the grantee?
Defeasible (Condition Subsequent)- conditions of retention- vested in possession V/P(if remainder, then V/I)
Determinable- conditions of retention- vested in possession V/P(If remainder then V/I)
Condition Precedent/ Contingent- conditions of acquisition or eligibility- contingent interest C/I
Words used: on condition that, but if, provided that, if it happens that, but when -- Phrases that seem tacked onto the estate
while, during, so long as, and until -- words of duration, temporal sound.
If, when
Grantor retains which reversionary interest?
Right of Re Entry- contingent interest C/I
Possibility of Reverter if FS/ Revisionary Interest if LE- vested interest V/I
Reversion - vested interest V/I
What happens if condition is voided by courts?
Since condition ‘tacked on’, the grant still continues without the condition.
Since condition is integral to grant, the whole grant fails. Beneficiary does not get land.
The contingent estate which is dependent on CP will be struck down. Except: charitable trust – cy-press doctrine.
An interest may be either vested or contingent.
Vested Gifts • A vested interest is immediate - no condition or limitation stands in the way of enjoyment. Basically
vested interest is an absolute interest. Prior life estates are allowed.• The term ‘vested’ can mean either “vested in possession” or “vested in interest”
• vested in possession - the interest is presently enjoyed by it’s owner.• vested in interest - interest that stands ready to fall into possession as soon as all preceding
interests have determined naturally. • An interest is vested if,
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Leases & Licences
Co Ownershi
Resulting Trusts
Constructive Trusts
Legal & Equitable
Leases
Life EstateFee TailFee Simple
Freeholds
Doctrine of estates
Copyholds
Free and common socage
Free tenures
Doctrine of tenure
Land Interests
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(a) it is limited to a person who is(i) in existence, and(ii) ascertained, and
(b) it is not subject to a condition precedent• e.g. To A for life, remainder to B -- the interests of both donees are vested. The life estate is vested
in possession; B's remainder is vested in interest (not in possession but future enjoyment) – B’s right is vested in A. This means that B has a present right which will be vested sometime in the future.
(a) All vested interests are fully alienable and can be sold or transferred in any way.
Types of Vested Interest(1) absolutely or indefeasibly vested interests - interests are vested at WM’s death and cannot be
defeated. E.g. “to A for life, remainder to B absolutely” B’s interest is vested indefeasibly. If he or she predeceases A, B’s estate will take the interest. In contrast, “to A for life, remainder to B for life, remainder to C absolutely” B has a limited interest and may not survive A to take. B’s interest is vested subject to complete divestment.
(2) Interests vested subject to partial divestment - interests are vested at the WM’s death, but which may be defeated in part thereafter. This type of interest is common in class gifts which are postponed to a prior life interest and those which are subject to a condition subsequent. E.g. “to A for life, remainder to all her children at age 21: if A has a child, X who is 21 at the WM’s death and 2 other children who have not yet reached that age, Y and Z, X’s interest is divested in part when Y and Z respectively reach age 21.
(3) Interests vested subject to complete divestment - interests given in remainder and that are less than absolute interests, interests given in default of appointment, and interest given upon a condition subsequent. E.g. “to A for life, remainder to B for life” B’s interest is subject to complete divestment, since he or she may not survive A to take.
Contingent Gifts • An interest is contingent if vesting is delayed pending the occurrence of some condition precedent,
the happening of which is not inevitable. Condition precedent = condition eligibility = suspensive condition.
• Right of re-entry is contingent b/c it is subject to a condition precedent.(a) e.g. “To A for life, remainder to B but only if and when B marries” — imposes a condition precedent
on B's remainder; “to A for life, then to B for life, then to C absolutely when C attains the age of 21” — the interests of A and B are vested, but C’s interest is contingent. It will become vested when C turns 21.
Types of Contingent Interest• contingent remainders• springing and shifting executory interests created by wills
Remainders and reversions are vested interests. If the gift to one person is liable to be defeated by reason of an unfilled condition subsequent and the gift is then directed to go to another, the condition subsequent is a condition precedent to the latter’s taking and his or her interest is often described as an executory gift over.
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"An estate is vested in interest when there is a present fixed right of future enjoyment. An estate is contingent when a right of enjoyment is to accrue on an event which is dubious and uncertain." {Pearson v. IRC (1981) AC 753.}
• All future interests are either vested or contingent. • The owner of a vested interest is guaranteed his estate; he or she has nothing to do but wait. So a
vested interest is more valuable than a contingent interest. • Under common law, a contingent interest was not something you could sell, since it may transpire
to be worthless, if the condition never occurs. • There is a preference in favour of vesting gifts at the earliest time possible. If unclear whether a gift
creates (i) a condition precedent; (ii) a condition subsequent; (iii) a determinable limitation, the latter two options are preferred because these readings lead to an immediate vesting of the interest. Courts prefer vesting of estates to contingent interest.
Freehold Estates – by G to “A for life and then to B in fee tail”• in possession – right to posses/occupy – A has a life estate in possession• in remainder – following a life estate – B has an estate in fee tail in remainder VESTED• in reversion – G retains an estate in fee simple in fee simple in reversion
Transferability:• Interests that are vested in possession (e.g. To A for life) are fully alienable, as are reversions and
vested remainders. • How about right of re-entry and possibility of reverter? Yes• Condition precedents?
Importance of Distinction between Vested and Contingent Interests(1) The owner of a vested interest will receive the subject-matter of the gift automatically when all prior
interests determine, while the owner of a contingent interest will receive nothing if he or she dies before the contingency is satisfied.
(2) A vested interest may accelerate if a preceding interest is destroyed; a contingent interest may not. (3) Whether an interest is vested or contingent is important for the application of the rule against
perpetuities. (4) A contingent interest may not always be alienable.
Property Law Act, s. 8Disposition of interests and rights 8 (1) The following interest and rights may be disposed of: (a) a contingent, executory or future interest in land or a possibility coupled with an interest in land, whether or not the object of the gift, the limitation of the interest or the possibility is ascertained; (b) a right of entry on land, immediate or future, vested or contingent. (2) A right of entry affecting land, exercisable on breach of condition or for any other reason, may be made exercisable by any person and the persons claiming under the person. (3) For the avoidance of doubt, the exercise of a right of entry under subsection (2) is subject to the Limitation Act.S. 8 of BC’s Property Law Act says that a contingent interest, right of re-entry, and possibility of reverter may be disposed of by deed. The Wills Act also permits a devise of such interests (s. 2)
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One of several reasons why equity/ trusts came to have such a role in property law
General Principles of Vesting:(a) presumption in favour of early vesting. Presumption that the WM intended the interest to vest at
his or her death or at the earliest moment thereafter. This applies to class gifts as well as gifts to individuals and other persons. It is ousted if the language of the will suggests a later date for vesting.
(b) presumption in favour of condition subsequent. The reason is that the interest will be vested, although subject to divestment, rather than contingent.
(c) presumption in favour of vested interests. – regarding remainders and residue – to avoid the exclusion of B and issue to a remainder interest.
(d) presumption in favour of postponement of enjoyment. This is preferable to postponement of vesting.
(e) presumption in favour of indefeasible interests. Preference for absolutely vested interests to those that are subject to divestment. In Parkes v. Trusts Corp. of Ontario (1895) the Wm devised a farm in trust to grandson, but if he died before attaining the age 21, the farm was to be transferred to his father. Since the father died before the son, the divesting condition could no longer occur and therefore, although the grandson died before he turned 21, nevertheless, it was held that his estate had become absolute.
Specific Principles of VestingGeneral prima facie rule: all words importing futurity, whether conditional or merely temperer, make the gift prima facie contingent.
Exceptions:Gifts over on Death Generally - The Rule in Edwards v. Edwards1. If there is an immediate gift to a person absolutely, with a gift over to another person in the event of
the first person’s death, prima facie the gift over is construed as gift over only in the event of the first taker predeceasing the WM. E.g. “to A, and if A dies, to B”.
2. If there is a postponed gift to a person absolutely, with a gift over to another person in the event of the first person’s death, prima facie the gift over is construed as a gift over only in the event of death of the first taker during the lifetime of the WM or during the lifetime of the life tenant. E.g. “to X for life, remainder to Y, but if Y dies to Z” - If Y predeceases testator or survives testator and predeceases X, Z takes a vested interest.
3. If there is an immediate gift, with a gift over on death coupled with an express contingency; prima facie the gift over will take effect whenever the death of the first taker occurs and the contingency is satisfied. E.g. “to A, but if she dies without leaving issue, to B” - prima facie B will take only whenever A dies and the contingency is satisfied.
4. If there is a postponed gift, with a gift over on death coupled with an express contingency, prima facie the gift over will take effect whenever the death of the first taker occurs and the contingency is satisfied. E.g. “to X for life and then to A, but if A dies without leaving issue, to B”
5. Phipps v. Ackers – if there is a gift that is prima facie contingent on a B attaining a specified age, followed by a gift over if it fails to attain, the contingency is construed as referring only to the time of payment – therefore vested subject to divestment.
Note that the rules are ousted if the will disclosed a contrary intention.
Re Brailsford [1916] – F: WM devised some real property upon certain trusts during the life of his widow, with remainder to his son, and with a gift over to the survivor of the son and the WM’s daughter, “his or her heirs and assigns”
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if the son should die without issue him surviving. There were alternative gift over to the son’s child or children if son should die leaving issue him surviving. Widow survived the WM, but predeceased the son. I & H: Whether the son’s interested vested on the widow’s death. Gift to son was indefeasibly vested in him on death of his mother.
Re Archer (1907) ONSC – Rule in Doe d. Blomfied v. Eyre: Where will provides gift would otherwise vest does not do so b/c some event has taken place, doesn’t fail b/c the person who would otherwise receive the gift can’t do so (unless that was WM’s intent). F: WM devised estate to wife Ann for life, then to Jane for life, remainder to Jane’s son, William, his heirs and assigns. In the event that William predeceases Jane without issue, Jane was to receive half interest in the real property absolutely and the other half interest was to go to the Presbyterian Church in Canada. Ann died after WM’s death and William died without issue. According to the instructions, 1/2 interest would pass to Jane, and 1/2 to the Church. However, the gift to the Church was void for mortmain, although subsequent legislation had removed the Church’s inability to hold land. The Church was incapable of taking. There was no residuary clause. I & H: What would happen to the 1/2 interest of the estate that was supposed to go to the Church? It went out on intestacy. NOTE: The law of mortmain formerly rendered devises of real property to charities, such as churches, void.
Gifts over on Death under Specified Age• Rule in Phipps v. Ackers or rule in Edwards v. Hammond: If there is a gift that is prima facie contingent
upon the beneficiary attaining a specified age, but it is followed by a gift over if the beneficiary dies under that age, the contingency is to be construed as referring only to the time of payment. The interest is to be construed as vested at the WM’s death subject to divestment of a condition subsequent.
• The rule is ousted by the expression of a contrary intention. E.g.” to the children of A who attain the age 21, with a gift over to another person.
Re Barton [1941] SCC – Where a specific gift is subject to the discretion of trustees to pay the whole or such part of that interest as they see fit, the gift of the corpus is nonetheless vested in the beneficiary despite that beneficiary having to fulfill a condition (here, attainment of an age). F: WM bequeathed money to grandson, Thomas when he should turn 25. If T should die before period of distribution, leaving no spouse or issue, gift should fall to residue, but if T should die before the period of distribution leaving spouse or issue him surviving, the gift was to be divided equally among them. Trustees authorized to advance T any income from the bequest as might be necessary for his maintenance and education. I & H: Whether legacy was vested at WM’s death subject to divestment if he died before 25? Yes. Court affirmed that the rule in Phipps v. Ackers applied to both realty and personalty.
Gifts over on Death before Receipt• If a gift over is made on the condition that the primary B die “before receiving his share” or words to
that effect, the courts have consistently held that those words are to be construed as referred in to death within the executor’s year, the year following the WM’s death traditionally being the period allied the executors for administering and distributing the estate.
Re Stephens: Royal Trust Co. v. East (1978) BCSC – A vested interest may be defeated by a subsequent condition or a contingency provided that Ct can assess from beginning, precisely & distinctly, date that interest will determine according to condition. F: WM gave life interest in estate to wife and directed trustees to pay varying portions of the estate to 7 named persons and organizations, including a 30% share to friend Aylen provided she was still living at WM’s death. If any primary Bs died before estate distribution, shares of such Bs should revert to the estate. Any portions reverted should be divided equally among 5 named persons. Wife and Aylen died before distribution. (slow executors)I & H: Aylen’s share is to revert back to the estate for redistribution.
Convenience of the Estate Rule
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• If a gift is prima facie contingent b/c of words of futurity, but the postponement is solely to let in a prior interest, it will be construed as vested at the testator’s death. E.g. “to A for life, and after A’s death to X” A’s death is not really a contingency in this situation; it merely shows that X’s estate is postponed until A’s life estate has ended. X’s interest vests a motte testatoris.
• The rule does not apply if the will discloses a contrary intention. E.g. if gift is postponed until the marriage of, or the attainment of a specified age by, the beneficiary. The postponement is to then for the convenience the estate, but for a reason personal to the beneficiary (Re Astor).
• Furthermore, for the rule to apply, the postponement must be to a date which must occur, such as the death of a life tenant, and not to an uncertain event such as marriage (Brown v. Moody, [1936].)
• The convenience of the estate rule also applies if there are 2 or more successive life interests followed by a remainder “upon the death of” the last life tenant. Hence, unless the will discloses a contrary intention, the remainder vests on the death of the WM and the fact that the 2nd life tenant predeceases the first is irrelevant - Re Brennan (1978).
Re Taylor (1972) ONSC – Presumption of early vesting is that wherever the words used in a will permit a construction that results in early vesting, the gift will be vested rather than contingent. F: WM gave 3/5 of estate to Norma so long as she remained unmarried. After N’s death or marriage, 3/5s of the estate be converted to cash and divided equally between N, if married, and her siblings or to the children equally of any of them who may be deceased. If any sibling died w/o issue, the share was to be equally divided among the surviving siblings. N died unmarried and no surviving issue. Brother, Keith died leaving 3 children. Sister, Lucy died and so did her issue. Myrtle and Lyall predeceased N, the first childless, and second leaving spouse and issue. I & H:• Whether a remainder interest in the WM’s estate vests upon his death or upon the death of the life tenant. Whether the
class of sisters and brothers of the life tenant is to be ascertained at the WM’s death or at the date of distribution, the death or marriage of the life tenant. WM intended the shares to vest in interest upon his death, but that possession was postponed for the benefit of the life tenant until her death or marriage.
• Whether vesting that occurred upon WM’s death was an absolute one, or a vesting, subject to divestment if the B predeceased the life tenant w/o issue. Is the estate of Myrtle, who died without issue after WM’s death, entitled to a share in the residue of estate? No.
• Are the children of Keith who predeceased the WM entitled to a share in the residue of the WM’s estate? Yes. • Is the share of Lyall in the residue of the WM’s estate payable to his estate or his children? Estate.
Postponed Payment• A WM may give a legacy or property to X in apparently absolute form, but then go on to provide that
the money shall be paid or the property transferred to B at some future time, such as the attainment of a specified age. E.g. “to A payable when she reaches 30”. The rule applied in such cases is that payment only is postponed, not vesting (Re Couterier, Couterier v. Shea).
• If the gift is held to be vested the Rule in Saunders v. Vautier applies, which holds that a B who is sui juris and who is entitled to an absolutely vested gift is entitled to call for payment or transfer when he reaches the age of majority.
• The Rule in Saunders v. Vautier can be ousted by a gift of the intermediate income to another person, by a clear statement in the will that B shall not receive the intermediate income, or by a gift over in the event that the primary B fails to satisfy the contingency. In the latter case the interest or the primary B is vested subject to divestment.
Re Squire (1962) ONSC – A legatee may accelerate payment that is otherwise to be postponed where he is absolutely entitled to the gift on the same reasoning as the collapsing of a trust by all sui juris benefices (capable of managing their affairs).
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F: WM devised certain real property to trustees in trust until his grandsons turned 21. Until then trustees were directed to invest income from rental of property and to accumulate it and pay it to grandsons at 30, unless after 18 they desire to pursue higher education, in which case trustees could pay up to $700/yr. I & H: The two grandsons became entitled to a conveyance of the properties devised in trust for them when they turned 21, together with the accumulated income.
Gifts to Survivors• If a gift is made to a group of persons, not necessarily a class, and the will provides that, if any on one
or more of the Bs should die before they become entitled to the gift it will go the survivor or survivors of them, the question also arises when the interest of the Bs vest. The prima facie construction in such a case is that the gift vests at the time of distribution (Cripps v. Wolcott). And that time is determined in accordance with the class closing rules.
• “to A for life, and then to my surviving brothers and sisters”. Prima facie, the members of the class must survive the life tenant in order to take under such a gift.
• If the reference to survivorship refers to survivorship among those who are entitled to the remainder themselves and not merely survivorship beyond the death of the life tenant, the survivor takes the entire gift even though he or she did not survive the life tenant (White v. Baker).
• The conjunctive ‘and’ in the phrase ‘the survivor and survivors of them’ is normally construed as ‘or’. However, this is not so if the Bs take as joint tenants. In that case, the last of the persons named takes the entire interest (Re Taylor).
Re Krause (1985) ABSC – F: WM directed that residue be divided “equally among my surviving brothers and sisters”. Sister Theresa predeceased WM leaving 2 issue. I & H: A gift to “my surviving brothers and sisters” was held to be a contrary intention to the anti-lapse provisions where one sister predeceased the WM, she did not survive the WM an therefore, her gift didn’t vest.
The Rule on Boraston’s Case• If real property is devised to a person when he or she attains a specified age and until that time the
property is devised to another person, the first person takes an absolutely vested interest and the second a term of years. The rule was designed to save contingency remainders that would otherwise be destroyed. The rule only applied to real property and only if the words of futurity are temporal such as “when” or “at”, not if they are conditional (Doe d. Wheedon v. Lea (1789)). The rule is excluded if the intermediate interest is not limited to the time when the ulterior B attains the specified age, but is for a definite time (James v. Lord Wynford).
VOID CONDITIONSCertain condition are void for public policy reasons, but not many, eg inciting crime, inducing separation & divorce, preventing marriage unreasonably. These are socially-constructed reasons & may change as social conditions Δ.
Conversion: If T has given specific property, but disposes of it before death, he has converted it into other property & w/ no remedial statutory provision, gift adeems b/c property doesn’t exist or isn’t owned by T. This is actual conversion.
Equitable Conversion:
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The property is available. T dies owning the property gifted in the will. There is no ademption or actual conversion that results in the gift adeeming, but there is some action by T resulting in a 3rd party w/ a greater equity. There is a beneficial interest that is enforceable by a ct of equity. Q: does the gift adeem after the equitable doctrine operates to give the item to 3rd party, & does 3rd party have to account in some way? See Church v Hill
Church v. Hill [1923] SCC – property adeemed- conversionF: WM left daughter piece of land & residue to be divided among other kids. WM entered agreement for sale of land to L, Only partial payment made and the rest was to be paid in installments, when WM dies I & H: Purchaser has equitable interest in land. The property adeemed (had been a conversion). The payments go to the estate - to the residual beneficiaries - daughter gets nothing.
Registration: You send a notice to register a will to the Wills Registry, which includes the location of the will. Wills Registry is a public registry. Registration is not mandatory.
Storage of wills for clients: Recommended holding periods - before 10 years after wills probate. Storage issues b/c of mandatory holding and clients move away or make new wills and don’t inform the lawyer.
***PRACTICE POINT1) Draft in careful consideration to the “what if” – if A passes then what?2) Use words of survivorship carefully as what you may end up w/ is litigation when you are 80.3) All of the vesting and gift over provisions are subject to the expressed intentions. If you think you have a drafting issue, get a second opinion.
REVOCATIONS, CHANGES & MUTUAL WILLSLEGISLATION:WESA s. 54-57.
CODICILSLEGISLATION• WESA 57(3) If a will has been revived by a codicil or has, by a codicil, been re-signed in the presence of
2 witnesses, the will is deemed to have been made at the time it was revived or re-signed.• WESA 99. Revival of a will by codicil does not revive a revoked designation in a will unless the codicil
expressly provides for revival.
GENERAL:• Codicil - A valid amendment to the Will that adds or amends the text• References Will it amends• Is typically “numbered”• Requires the same intent, capacity and procedural execution requirements. • If legacies are given to the same person, whether of the same or different amounts, in the will as well
as in a codicil, the legacy given by the codicil is presumed to be additional to that given by the will. The
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presumption is rebutted by a contrary intention of the WM. (Henderson v. Fraser - WM gave $20,000 to Fraser and $10,000 to Henderson in will. In codicil he gave $25,000 to each. Codicil’s 1st clause: "I hereby ratify and confirm the said will in every respect save in so far as any part is inconsistent with this codicil” instead of usual ratification clause. Presumption not rebutted b/c codicil did not expressly revoke the prior gifts.)
• Will has to be valid in itself in order to incorporate another document (e.g codicil) by reference to it. (Re Alma Gertrude Turner)
• Codicil may be revoked by absence of the will implying WM destroyed will purposively. (Re Alma Gertrude Turner)
***PRACTICE POINT• Advise client to keep will and codicil together.
• It is better to do another will, rather than a codicil.
Henderson v. Fraser 1924 (SCC) - amt in codicil is in addition to amt in will. F: WM gave $20,000 to Fraser and $10,000 to Henderson in will. In codicil he gave $25,000 to each. The first clause was as follows: "I hereby ratify and confirm the said will in every respect save in so far as any part is inconsistent with this codicil” instead of usual ratification clause.I & H: Were the bequests in the codicil in addition to or substitutional? In addition to. The codicil did not expressly revoke the legacies in the will. Presumption not rebutted.
Macdonell v. Hudson (Estate of), 1995 BCSC – F: WM replaced McGregors as executors in codicil with Killen, James MacDonell & Cove (solicitor) with a charging provision for Cove for fees. Done after McGregors had taken steps to obtain a Committeeship to take over WM’s affairs. Codicil was executed after WM released from hospital after being diagnosed with Alzeimers. But evidence of marked improvement in mental state. Ross MacDonell demanded proof of codicil in solemn form — brought action to have codicil found invalid by reason of incapacity.I & H: 1. Whether codicil was valid. Application for summary judgement to dismiss application of MacDoneel with burden of proof
of capacity placed on Cove and Killen to prove validity of codicil. — WM capable b/c evidence of WM’s improved mental status and understanding of will contents — 4 affidavits provided by Cove and Killen. Application for summary judgement to dismiss was granted - codicil valid.
2. Costs for Cove and Killen as successful applicants for summary judgement. — costs for Cove and Kille to be paid by MacDonell. In this case “[t]here is no justification for putting the Estate to the expense of proof in solemn form.”
Application:1. Capacity for the making/executing of a codicil needs to be proven just as in a will. 2. Burden of proof on propounders of codicil to prove capacity.3. Affidavits by witnesses and medical staff together were sufficient proof for the court.
Alma Gertrude Turner (Estate of), 2003 BCSC – R: If original will is destroyed, mutilated, or cannot be found, there is a rebuttable resumption that WM intended to revoke that will. “The presumption can be rebutted either by the circumstances tending to support a contrary conclusion than destruction by the WM or by declarations made by the WM indicating that the lost will was regarded as valid and subsisting . The presumption may also be rebutted by the conduct of the WM .”F: WM’s original 1987 will — not properly witnessed. Original was given to daughter, Norma, who gave it to Public Trustee. Photocopy of a codicil executed in 1990 was found among the WM’s belongings. Codicil witnesses by 2 people but did not have the usual attestation. Her will could not be found. Defect in codicil cured by affidavit from one of the witnesses who deposed that two witnesses were both present for execution of codicil by Ms. Turner; that they signed as witnesses in presence of Ms. Turner and in the presence of each other.I & H: • Does the codicil validate the 1987 will, which was not formally valid? No. The incorporating instrument has to be valid in itself
in order to incorporate another document by reference to it.
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• Is the presumption of revocation of the codicil b/c of the absence of the original instrument rebutted? “Here the presumption arises, in the absence of the original instrument, that Ms. Turner had revoked the codicil. That presumption is not rebutted by the evidence, indeed it is stronger for that evidence.”
REVOCATION Ask: 1) intent 2) revocation issue 3) capacity issue
LEGISLATION• Will Revocation: WESA 55(1) A will or part of a will is revoked only in one or more of the following
circumstances:(a) by another will made by the will-maker in accordance with this Act;(b) by a written declaration of the will-maker that revokes all or part of a will made in accordance
with section 37 [how to make a valid will];(c) by the will-maker, or a person in the presence of the will-maker and by the will-maker's
direction, burning, tearing or destroying all or part of the will in some manner with the intention of revoking all or part of it;
(d) by an order of the court under section 58, if the court determines that the consequence of the act of burning, tearing or destroying all or part of the will in some manner is apparent on the face of the will, and the will-maker intended to revoke all or part of the will.
• Note: marriage of WM no longer revokes WM’s earlier wills (changed by WESA s. 55(2) A will is not revoked in whole or in part by presuming an intention to revoke it because of a change in circumstances.). Under WESA - no more life estate to the spouse.
• Gift Revocation: WESA 56(2) If WM and spouse cease to be spouses, any gift/appointment/Power of Appointment to that person is revoked.
• Saving provisions - WESA s 582) On application, the court may make an order under subsection (3) if the court determines that a record, document or writing or marking on a will or document represents
(a) the testamentary intentions of a deceased person,(b) the intention of a deceased person to revoke, alter or revive a will or testamentary disposition
of the deceased person, or(c) the intention of a deceased person to revoke, alter or revive a testamentary disposition
contained in a document other than a will.(3) Even though the making, alteration or revival of a will does not comply with this Act, the court may, as the circumstances require, order that a record, document or writing or marking on a will or document be fully effective as though it had been made
(a) as the will or part of the will of the deceased person,(b) as an alteration, revocation or revival of a will of the deceased person, or(c) as the testamentary intention of the deceased person.
(b) Revocation by another will• what if no magic language “I revoke all previous” .. • what about “ability to infer”
(c) Revocation by written declaration• written declaration that WM revokes all or part but requires 2 witnesses + signature. • A codicil uses: ‘I revoke paragraph xx and replace it with yy”.
(d) Revocation by burning, tearing, destroying• By WM or another person in WM’s presence
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• Partially destroyed? The person alleging the revocation must prove it was done with animo revocandi.
(e) Revocation by order of court• WESA s. 58(2) and (3).
GENERAL• animus revocandi - intention to revoke• Formality and capacity requirements same for revocations as they are for execution. • WM must have capacity at time of revocation - Eaton v. Heyman, [1946] BCSC. • WM’s intention is paramount - mere existence of a revocation clause OR some degree of mutilation of
the will may be insufficient to revoke the whole will. • Re Phelan [1972] & Re Johannson (1978) express revocation clause disregarded. • Destruction of will and intention to revoke must coincide - Cheese v. Lovejoy (1877).• A will destroyed through inadvertence is not revoked - Eaton v. Heyman; Re Thornton.
• If 2 wills can be read in harmony (e.g. cover different property) & makes sense to do so, 2nd will’s revocation clause will be read out (Re Lawer).
• Destruction of material parts of the will revokes will in its entirety (Re Adams, 1992, UK).• If WM removes sheets from executed will, inserts corrected pages, and has these pages executed, and
if the original pages by themselves are not intelligible, such changes will invalidate the entire document - Leonard v. Leonard [1902]. However, in one case page 2 had not been signed originally, had been typed at a different time, and signed with a different pen but it was admitted to probate - Re Ireland (1983) BCCA.
Revocation that isn’t Revocation• Mistake• Lack of capacity• Undue influence• Fraud• Inadvertance
Leonard v. Leonard [1902] - alteration of sheets - revoked. R: If WM removes sheets, and inserts corrected pages and has these pages executed, and if the original pages by themselves are not intelligible, such changes will invalidate the entire document. F: WM’s original will had 5 pages. He had sheets 1 and 2 re-engrossed. All of the sheets were signed by the testator and same 2 witnesses. H: Court held that the entire document was invalid. Sheets 3,4, and 5 were not intelligible on their own. The signatures on the new pages were to identify and make them valid if the will was valid in the end. The later sheets had no effect by themselves.
Re Lawer, 1986 SKCT - two complementary willsF: WM had 2 wills - 1st handwritten - 2nd on commercial form (which included standard revocation clause). probate sought for both H: clause not enough - must also be intention to revoke // also, the two wills do not contradict one another - both stand
Re Norris, 1946 BCSC - torn will - not revoked
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F: WM suffered delusions after WM’s death, his mistress found his will torn up into pieces in an envelope - signature not torn. Will left everything to mistress.H: Court looked at totality of circumstance - found no intention to revoke long-term relationship w/ mistress; she passed as his wife; cared for him; house was in her name; WM refused English family financial assistance
Re Adams, 1992 UK - destruction of material parts - revokedF: WM’s will discovered after death with heavy markings - cannot tell what’s under the marks.I: Was will revoked? H: Destruction occurs when you can no longer read underlying words parts of will
REVOCATION BY MARRIAGE• WESA s. 55(2) A will is not revoked in whole or in part by presuming an intention to revoke it because
of a change in circumstances — marriage of the WM no longer invalidates the will. • BN: If you married on or before March 31, 2014 the Wills Act applies and the Will is void and NOT
revived by WESA.
Wills Act15. A will is revoked by the marriage of the testator, unless(a) there is a declaration in the will that it is made in contemplation of the marriage, or(b) the will is made in exercise of a power of appointment of property which would not in default of the
appointment pass to the heir, executor or administrator of the testator or to the persons entitled to the estate of the testator if the person died intestate.
• Marriage is void/voidable• void if party lacked capacity or is mistaken as to the identity of the other party• voidable if formal requirements not met, WM coerced intro the married or inability to
consummate.
***PRACTICE POINT• Reporting letters to a client vary but you need to address: marriage, divorce as common possible
occurrences.
• A person may lack the capacity to make a will but have the capacity to marry. The current law results in revocation - which is an act of the WM requiring capacity.
Challenging the Will under WESAWESA 60. Despite any law or enactment to the contrary, if a will-maker dies leaving a will that does not, in the court's opinion, make adequate provision for the proper maintenance and support of the will-maker's spouse or children, the court may, in an action by or on behalf of the spouse or children, order that the provision that it thinks adequate, just and equitable in the circumstances be made out of the will-maker's estate for the spouse or children.
• If the WM dies leaving an inadequate provision for spouse or children, the court may, order just and equitable provision out of the Estate.
• What is just and equitable? The size of the estate matters. Ask: What is the size of the estate? What is the nature of the relationship of the person challenging the will? What is their need?
Requirements: Procedure & Evidence
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• WESA 61: Procedure• Requires commencement w/in 180 days of grant of probate. • Service of writ of summons on Executor w/in 210 days of grant of probate . • What if there is no probate application?
• WESA 62: Evidence – Court may accept evidence it considers proper as to WM’s reasons for making the gifts he/she in will and for “not making adequate provision” for spouse/children including any written statement signed by WM.
REVOCATION OF GIFTSWESA 56 (1) This section is subject to a contrary intention appearing in a will.(2) If a will-maker(b) makes a gift to a person who was or becomes the spouse of the will-maker,(c) appoints as executor or trustee a person who was or becomes the spouse of the will-maker, or(d) confers a general or special power of appointment on a person who was or becomes the spouse of the will-
maker,and after the will is made and before the will-maker's death the will-maker and his or her spouse cease to be spouses under section 2 (2) [when a person is a spouse under this Act], the gift, appointment or power of appointment is revoked and the gift must be distributed as if the spouse had died before the will-maker.(3) The operation of subsection (2) is not affected by a subsequent reconciliation of the will-maker and the spouse.(4) For the purposes of subsection (2), the relevant time for determining whether a person(a) was the spouse of a will-maker is at the time the will was made, or(b) became the spouse of the will-maker is at any time after the will was made and before the spouses ceased to be spouses under section 2 (2).
• WESA 56 — Gift to a person who was/became spouse and then ceases to be spouse - gift, appointment or power of appointment is revoked and gift redistributed as if the spouse had predeceased WM.
• WESA 2 - ceases to be spouse: if married - living separate and part for 2 years w intention to live separate and apart. — consider involuntary separation.
Potential Issues• WESA 2 – when person ceases to be a spouse
• (ii) event causes an interest in family assets to arise (FRA) Part 5 (now FLA)• FLA 81(b) — on separation, each spouse has a right to an undivided half interest in all family property
as a tenants-ins-common, and is equally responsible for family debt.• FLA Excluded property
• 85(1) The following is excluded from family property:(a) property acquired by a spouse before the relationship between the spouses began;(b) gifts or inheritances to a spouse ;
• Division of excluded property96 The Supreme Court must not order a division of excluded property unless
(a) family property or family debt located outside British Columbia cannot practically be divided, or(b) it would be significantly unfair not to divide excluded property on consideration of
(i) the duration of the relationship between the spouses, and(ii) a spouse's direct contribution to the preservation, maintenance, improvement, operation or management of excluded property
• gifts or inheritances to a spouse - may not be protected if it is put into a joint bank account
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**Practice point: WM should state: I strongly encourage my children to get legal advice with regard to their inheritance and keep the funds separate unless they have received such legal advice.
LOST WILLS• Where WM has control of will and will disappears, it’s presumed destroyed for the purpose of
revocation — presumption is rebuttable (Sugden). This presumption is valid only if the will cannot be found after the death of the WM, it does not apply if the will existed at all after her death.
• In order for the court to apply this presumption it must be proved that “the fullest inquiries for the lost will were made” (Alma Gertude Turner).
• Presumption is rebutted if: (Alma Gertrude Turner (Estate of), 2003 BCSC)(a) “circumstances tending to support a contrary conclusion than destruction by the WM”(b) “declarations made by the WM indicating that the lost will was regarded as valid and subsisting”(c) “conduct of the WM”
Sugden v Lord St Leonards, 1876 — presumption rebuttedF: WM’s will couldn’t be found - 8 codicils were registered though H: no revocation - WM couldn’t have possibly meant to die intestate (he was a wills & estate lawyer!). WM’s daughter able to re-write the will from memory
Lefebvre v Major, 1930 SCC - presumption rebuttedF: WM found long time after death - his body was badly decomposing - understandably, no one thought to search for his will in the haste to burn contents of room. Search for will in rest of house turned up nothing. H: WM valued will very much & probably had it close to him + had confirmed gifts only a few weeks prior - destruction accidental - no revocation.
Alma Gertrude Turner (Estate of), 2003 BCSC – F: WM’s 1987 will was was not properly witnessed. The original was given to daughter, Norma, who gave it to Public Trustee. Photocopy of a codicil executed in 1990 was found among WM’s belongings. Her will could not be found. I & H: Is presumption of revocation of the codicil b/c of the absence of the original instrument rebutted? “Here the presumption arises, in the absence of the original instrument, that Ms. Turner had revoked the codicil. That presumption is not rebutted by the evidence, indeed it is stronger for that evidence.”
CONDITIONAL REVOCATION/ DEPENDENT RELATIVE REVOCATIONWhere a condition is attached to a revocation, if the condition is unfulfilled, no revocation occurs. There are 3 situations in which a revocation is conditional:(1) WM believes the will is void - If a valid will is destroyed b/c WM believes at the time of the
destruction that it was not a valid will, the will is not revoked, b/c WM had no intention of destroying a valid testamentary document (Giles v. Warren (1872) — friend told WM that will was invalid, WM tore it up, but kept pieces in safe place)
(2) WM is mistaken about the facts or the law - If a valid will is destroyed in circumstances in which WM believes that he is revoking a valid will, but does so under a mistaken belief as to the facts or the law the will is not revoked (Re Southren [1925] WM executed will prior to a trip leaving all property to wife; upon return he destroyed will believing she would get all anyways on intestacy. Belief wrong in law so revocation not effective; Re Sorenson (1982) WM left gifts to 2 sister-in-laws. Thinking they were both dead, she made codicil gifting their share to a friend).
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(3) Dependent relative revocation doctrine - If WM wishes to make new will to replace an existing one and revokes existing one in anticipation of making the new one, the revocation may or may not be effective. If WM intends revocation to be effective whether or not the new will is made, it is effective. But if WM intends that the revocation shall not be effective unless and until the new will takes effect, the revocation is not effective. This doctrine allows the old will to remain effective if the new one is not made or fails for any reason, if you can show WM’s intention was conditional upon the new will taking effect. Application of the doctrine is not automatic (Re Jones - 1st will left land to 2 nieces. WM had contacted lawyers about making 2nd will that instead left land to nephew - never done. After death, top half of 1st will discovered (page had been torn in 2). WM intended to revoke 1st will, regardless if new will made - revocation not conditional).
• destroyed will? (1) did WM destroy w/ intention to revoke?(2) Was revocation conditional?(3) If so, was the condition fulfilled?
Re Sorenson, 1981 BCSC - WM is mistaken about facts/lawF: WM left gifts to 2 sister-in-laws. Thinking they were both dead, she made codicil gifting their share to a friend.I: Was revocation conditional on sister-in-law being dead? H: Yes, revocations made on a mistake of fact or law are inoperative
In Re Jones, Decd, 1976 UK - revocation found NOT conditional. doctrine not automatic. F: 1st will left land to 2 nieces. Nieces died. WM had contacted lawyers about making 2nd will that instead left land to nephew - never done. After death, top half of 1st will discovered (page had been torn in 2). I: (1) did WM intend to revoke will by destruction (2) was revocation conditional upon new will being executed:H: There was no evidence the the WM believed that the destruction of the will was a necessary precondition to making an effective new will. Her last will contained a revocation clause revoking a prior will - reasonable to infer that she knew an existing will could be revoked by a revocation clause in a new will w/o any other form of cancellation. WM intended to revoke 1st will, regardless if new will made - revocation not conditional.
REVOCATION – POWERS OF APPOINTMENT• Power of appointment — is a right given by the owner of property, called the donor of the power, to
another person, called the donee of the power, to dispose of, or appoint the donor’s property.(2) General - donee may appoint anyone including self. (3) Special - donee may only appoint w/in a specified class. (4) Hybrid - donee appoints from specified class but some are excluded from class.
• Purpose - delay disposition/ shift onus of decision-making to another. • Power may be a trust - then must be exercised• Power merely a “power” - may be exercised or not - therefore would typically be followed by a gift
over in default of appointment.
Revocation of AppointmentLegislation• Alteration or revocation of designation in will — 96 A designation in a will may be altered or revoked
by a later designation that is not in a will.• Designation in will — 97(1) A revocation in a will of a designation revokes a designation that is not in a
will only if the revocation in the will relates to the designation, either generally or specifically, and the designation is not irrevocable. (2) The revocation of a will revokes a designation in the will. (3) Revocation of a designation does not revive an earlier designation.
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• Effect of designation in purported wills — 98 (1) A designation or revocation of a designation contained in a purported will is not invalid merely because the instrument is invalid as a will. (2) A designation in a purported will is revoked by an event that would have the effect of revoking the instrument if it had been a valid will.
• Effect of revival of will on designation — 99 Revival of a will by codicil does not revive a revoked designation in a will unless the codicil expressly provides for revival.
• Effective date of designation and revocation — 100 Unless a designation is irrevocable, a designation or revocation of a designation in a will is effective from the time the will is made.
ALTERATIONS IN A WILLLegislation• WESA 54(2) An alteration to a will is valid if the signature of the will-maker to the alteration, and the
witnesses to that signature of the will-maker, are made(a) in the margin or in some other part of the will opposite to or near to the alteration, or(b) at the end of or opposite to a memorandum referring to the alteration and written in some
part of the will.• WESA 58(3) - Even though the making, revocation, alteration or revival of a will does not comply with
this Act, the court may, as the circumstances require, order that a record or document or writing or marking on a will or document be fully effective as though it had been made
(a) as the will or part of the will of the deceased person,(b) as a revocation, alteration or revival of a will of the deceased person, or(c) as the testamentary intention of the deceased person.
• WESA 58(4) - if an alteration is invalid, court can reinstate the original word/provision if there’s evidence as to what it was.
General• There is a rebuttable prima facie presumption that any apparent changes in a will were made after the
will was executed until contrary evidence is adduced (Oates; Law v. Law (1989); Re Brown (1999)). The onus is on those who allege the changes existed when Will was executed to prove the allegation.
• Always required: capacity + intention + execution of will formalities• The will should be retyped or, if that is inconvenient, the alternations made before execution should
be executed and altered in accordance with the statute. - initials of WM + witnesses.• When the alteration, although not signed and attested, obliterates the original words, the original
words are effectively revoked (Re Douglas Estate (1986) Nfld SC TD - WM covered certain words in his will using liquid paper correction fluid but did not sign/initial the obliteration - words not discoverable in a natural way, but were only legible after scraping off the correction fluid).
Re Douglas Estate (1986) – It is not permissible to use artificial means to ascertain what was written beneath the obliteration. F: WM covered certain words in his will using liquid paper correction fluid but did not sign/initial the obliteration. I & H: Whether the words before alteration are “apparent”. No, words were not discoverable in a natural way, but were only legible after scraping off the correction fluid. “The obliteration by the use of the lidiid paper correction fluid is absolute and total”.
Smith Estate, 2012 ABQB – In Alberta, court can make an order validating alterations to a will even though formalities are not followed.
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F: WM made handwritten alternations to his 2003 will after he separated from his wife. These alterations were not initialed or signed. I: Are the handwritten alterations to the will valid? Yes, although the alterations were not made according to the formalities required, the court found the WM intended the alterations.
REVIVAL OF REVOKED WILLS
LEGISLATION: • WESA 57(1) A will or part of a will that has been revoked is revived only by a will that shows an
intention to give effect to the revoked will or the part that was revoked. -- a revoked will can only be revived by a will that shows an intention to do so
• WESA 57(2) Unless a contrary intention appears in the will that revives a will under subsection (1), if a will that has been partly revoked and afterwards wholly revoked is revived, the revival does not extend to the part that was revoked before the revocation of the whole. -- revival does not include any portion of will that was revoked prior to whole revocation -- unless by court order
• WESA 57(3) If a will has been revived by a codicil or has, by a codicil, been re-signed in the presence of 2 witnesses, the will is deemed to have been made at the time it was revived or re-signed. -- revival by codicil - same time as codicil.
• WESA 58 -- curing deficiencies -- ineffective revival can be “cured” by court if intention of WM established.
• WESA 99. Revival of a will by codicil does not revive a revoked designation in a will unless the codicil expressly provides for revival.
Re McKay, 1953 BCSC - intention to revive must be clearF: WM had 1st and then 2nd will. She executed a codicil to the 2nd will (changing the management company to be in charge of the estate) BUT the codicil referred to the date of the 1st will. I: Did this revive the 1st will? H: No, intention not sufficiently clear - nothing beyond the date, which could’ve been mistake.
JOINT AND MUTUAL WILLS• Joint - one document that contains the testamentary wishes of 2 parties - stands as their will
(Gillespie). It may be probated twice, once after the death of each WM (Re Stanley).• Mirror - separate wills that mirror each other - dispose of property in reciprocal fashion. • Mutual - 2 parties have separate wills + agreement that neither will change their will (U of M v.
Sanderson). No changes made w/o consent of other party. If one WM dies, surviving party cannot make changes to dispositions. Surviving party = trustee of constructive trust.
• Joint and mirror wills can also be mutual wills if subject to agreement to not change the will. Mere existence of mirror wills is not if itself sufficient evidence of an agreement between WMs. Court must be able to ascertain w clarity and precision, wither from terms of the wills or some there document incorporated by reference, that an agreement was made (Re Gillespie).
• Joint tenancy:• A joint or mutual wills with agreed provisions for property held in joint tenancy that are
inconsistent with the absolute ownership generally conferred by the right of survivorship will have the effect of severing the joint tenancy (Szabo v. Boros).
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• If joint property acquired after binding mutual wills made, the acquisition does not revoke wills; the joint tenancy is impressed with the trust imposed by the mutual wills (U of M v. Sanderson Estate).
• potential issue -- is this a K b/w the 2 parties? Wills can be unilaterally revoked, but right to revocation under K more restricted.
• other issues -- what interest does surviving spouse hold? What if circumstances change? Does mutual will apply to property later acquired?
University of Manitoba v. Sanderson Estate, 1998 BCCA - cautionary tale of mutual willsF: S1 & S2 executed mutual wills + agreement under seal - survivor promised not to revoke will after death of the other. Will left estate of deceased in trust for survivor + residue after death of both to go to U of M. S1 dies and S2 executes new will - terms inconsistent with mutual will. U of M sues - claims CT over entire estate.H: There was mutual agreement not to revoke wills & S1 did not breach that agreement whilealive. CT imposed on the estate.
Spousal Trust• better option than mutual wills -- spousal trust -- security of knowing property available for spouse,
with the ability to set some terms on use• tax implication -- no deemed disposition if property passes to spouse + income payable to spouse +
spouse only one w/ access to capital
ESTATE ADMINISTRATIONGRANT OF LETTERS PROBATE OR ADMINISTRATION• WESA 129 (1) The court may grant probate of a will or administration of an estate for general, special
or limited purposes on proof(b) of the validity of the deceased person's will or that the deceased person died without a will, and (c) that the deceased person was ordinarily resident or domiciled
(i) in British Columbia at the time of his or her death,(ii) outside British Columbia at the time of his or her death and left property in British Columbia,
or(iii) outside British Columbia at the time of his or her death and the personal representative will
be a party to an action commenced in British Columbia.• WESA 160 (1) If a person is appointed as the personal representative of a deceased person, the estate
of the deceased person vests in the personal representative without any further declaration or order.
PROBATE• Probate — process of submitting will to court for approval (submit original and proof that it’s the last
known will) and court order approving executor to act. • Grant of Letters Probate — court’s confirmation of the authority of executor(s).• Grant of Letters of Administration — court appointment of one or more persons to administrate the
estate of an individual who dies intestate.• Proof in common form — standard; Proof in solemn form — rare but when there is an allegation as to
wills’ validity or WM’s capacity.
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• Effect of proof in solemn form: EAA 56 - “conclusive evidence of is validity and contents, other than in proceedings on appeal from, or to revoke, the grant of administration”.
• Probate may be essential to establish legal recognition of executor — enable them to deal w/ deceased’s property.
• Notices of will and probate must be sent to Bs and potential claimants against estate — give opportunity to make claims & apply for variation.
• Pro: alerts potential claimants to existence of will. Start of limitation to vary will doesn't begin until probate.
• Con: Probate fees for estates >$25k (based on cross value of estate). Avoid expense of probate application. Public record.
Grant of Letters Probate/Letters of Administration not Required:1. Joint title - assets held by deceased and another person jointly with right of survivorship.2. Life insurance policies, pensions, employment benefits, Registered Retirement Savings Plan etc,
where a designated B, other than the estate, has been named. 3. If total value of estate is <$25k and includes a MV, the MV Branch may transfer vehicle based on
Statutory Declaration signed by executor or next of kin declaring that no application for a Grant will be made and that the total value of the estate is <$25k.
Grant of Letters Probate/Letters of Administration Required:1. If real property title or registered charge against title of real property and the title or charge is
registered in BC in the sole name of the deceased. In such cases, the Land Title Office requires a Grant must be obtained.
2. Bank accounts - banks may require an indemnity agreement signed by executor and/or beneficiaries or heirs-at-law on an intestacy in favour of the institution.
3. Securities e.g. company shares, units in investment fund, bonds etc. BN: private companies typically require an authenticated copy of will and not a grant.
4. Any other asset that cannot be brought in w/o providing a grant to the regulatory body which governs the transfer or redemption of asset.
Examples of Questions to Ask:1. What are the assets?2. How are they registered?3. What is their total worth?4. Is there real property?5. Are there private companies?
APPLICATION FOR ADMINISTRATION
General• If no named executor or deceased dies intestate, heirs w/ an interest in the estate can apply to be an
administrator. • Administrator has to show there’s no will, give inventory of assets & liabilities, and send notice to
intestate heirs. Extra step: give notice to creditors so that they would consent to appointment of this person as administrator.
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Documents Required for a Typical Administration Application(a) requisition(b) certificate of wills notice search(c) affidavit of administrator — Form 92(d) statement of assets, liabilities, and distribution (disclosure statement), exhibited to the affidavit of
administrator(e) Affidavit of notice under the EAA s. 112(f) Notice under s. 112, attached as an exhibit to the s. 112 affidavit(g) Order(h) Cheque for probate filing fees• Additional docs dependent on type of application: consent of all parties having a prior or equal right to
apply for Letters of Administration etc, consent of creditors to appointment of administrator, an order pursuant to EAA s.122(3), dispensing w/ notice.
Procedure• In Vancouver, NW, & Victoria — Application can either be spoken to or proceed by way of desk order.
• Desk order: Master/judge signs list of applications that have been approved by Registrar; list becomes order of court approving issuance of grant. Registrar then prepares grant.
• Other jurisdictions — Registrar approves application and the file and a fiat are submitted to judge or master for signature. Registrar then issues grant on basis of fiat.
Other Grants of Administration • Small Estate — when estate <$25k and still necessary to obtain Grant of Administration - Under
existing EAA provisions, Registrar could issue a grant w/o Court Order. S 109-120 of WESA will not be in force as of March 31, and therefore there is no provision to deal with small estates. If an Executor cared to get grant, he or she could apply and there is no “fee” required.
• Administration with Will Annexed – If named executor can’t/won’t act — • A B or creditors with an interest in the estate can apply. (EAA s. 6, 7, &12). • WESA 131 priority of applicants:
a) B who applies having the consent of the Bs representing a majority in interest of the estate, including the applicant;
b) B who applies not having the consent of the Bs representing a majority in interest of the estate;
c) any other person the court considers appropriate to appoint, including PGT, subject to the PGT's consent.
• Administrator ad colligenda bona — If there is a delay in appointment of a general administrator and it is necessary for someone to collect the assets and protect the estate. Also includes grant to waive SCP on behalf of estate — so get disclosure of WM’s file.
• Administration pendent lite — If there is disputed wills or ongoing dispute as to who is the administrator, court may appoint independent 3rd party or B, until proper personal representative is determined. Note: Administrator does NOT have right to distribute estate. (EAA 8). Normally requires CONSENT of creditors & Bs.
• Administration by Attorney — When a person entitled to administration resides outside BC, administration or administration with will annexed may be granted to that person or to his or her attorney acting under a POA (SCCR 21-5(27)). *See WESA 139 – limited grant to attorney of foreign PR.
• Administration of Unadministered Estate/Administration de bonis non
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• When PR dies leaving part of estate unadministered, a grant in respect of the unadministered estate will be issued to a new PR to enable administration to be completed. — B may apply.
• Look to:1. The will for an alternative Executor2. If no alternative, then the will of the executor (chain of executorship). 3. If no original will, and no will of the administrator to the personal representative of the
deceased administrator subject to application of others beneficially interested in the estate with priority rights under s.130.
• Special Circumstances — s. 132 Grant• WESA 132(1) … court may appoint as administrator of an estate any person the court considers
appropriate if, because of special circumstances, the court considers it appropriate to do so. • (2) The appointment of an administrator under subsection (1) may be
(a) conditional or unconditional, and(b) made for general, special or limited purposes.
• Example: Grant where all next of kin are minors in an intestacy - -the court may grant administration to a person the court things fit during the minority of the next of kin. The grant would contain a provision of expiration upon the minor attaining the age of majority.
• The administrator would also be expected to pass his/her accounts upon the expiration of the grant
• Example: If there is a delay in appointment of a general administrator and it is necessary for someone to collect the assets and protect the estate (formerly referred to as administrator ad colligenda bona)
• The Court may give the administrator powers according to the assets involved such as the power to renew a lease, dispose of a business, sell assets, etc. The grant may be made in circumstances where the person entitled to a grants has not yet applied b/c he or she refuses to apply, is out of the country or has yet to be determined for other reasons. The s. 132 grants may be made to any appropriate person including a creditor or even a friend of the deceased. The Court has discretion to only require the basic fee to be paid.
• Administrator Ad Litem — If at any court proceeding it appears to the court that the deceased person has an interest in the matter in question but has no personal representative, the court may either proceed in the absence of such representative or may appoint an administrator ad litem to represent the estate for the purposes of the proceeding (EAA s. 8; SCCR 20-3(12) an d(12)).
Resealing Foreign Grants• WESA 138 (1) On application by a foreign personal representative, the court may reseal a foreign grant
made in another province or in a territory of Canada or in another prescribed jurisdiction. • Re-sealing = process of having local or provincial court confirm a Grant of Probate from another
jurisdiction. • Process is very similar to applying for original Grant of Probate. It can't be exactly the same, b/c
original Will is not available, having already been submitted to first court. Other difference is first Grant of Probate would have included a detailed inventory of all kinds of assets and debts. Resealing application will only address real property (and any related debts etc.) in new jurisdiction. Probate/resealing court fee is usually significantly smaller than original application.
Limited Grant to Attorney of Foreign PR
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• WESA 139 (1) In this section, "attorney" means a person who is appointed as the representative of a foreign personal representative under a power of attorney.
• (2) On application by an attorney of a foreign personal representative, the court may grant probate or administration to the attorney, limited to the deceased person's estate situated in British Columbia.
SECURITY FOR EXECUTOR/ADMINISTRATOR — BONDS• Grants under existing legislation require PR to obtain a bond unless exempted. Almost all grants are
issued “without bond”. Courts are a little more concerned if there is an executor who resides outside of BC and certainly if PG&T office is involved — they may ask court to require a bond be posted.
• WESA reverses that position of bond or security requirements to state that no bond is required UNLESS
(1) a minor or mentally incapable person w/out nominee is involved in the estate or(2) someone applied to the court asking for it (class of people — people interested in will).
• Other matters: • Insurance co. issue the bonds• annual renewal fee• cost is a sliding scale ($3-4/$100) with a min, of $35.• Certificate submitted to the Court — returned on Court Order.
EXECUTORS & ADMINISTRATORS
Legislation142 (1) A personal representative has the same authority over the estate in respect of which the personal representative is appointed as the deceased person would have if living, subject to
(a) a contrary intention appearing in the will of the deceased person, and(b) this or any other enactment.
(2) A personal representative must exercise authority to(a) administer and distribute the estate in respect of which the personal representative is appointed,(b) account to beneficiaries, creditors and others to whom the personal representative has at law a duty to
account, and(c) perform any other duties imposed on the personal representative by the will of the deceased person or by law.
General• Executor (individual named in will) OR Administrator (individual appointed by court if no will exists) is
the “personal representative” of deceased. • Legal title of deceased’s property vests immediately where there’s an executor. Where intestacy -
there’s a “gap” where legal title is not vested - lasts until administrator is appointed - then legal title vests with that individual.
• Executor — will “speaks” from time of death, so executor may act immediately (at least 120 days after grant of probate under WESA); Administrator — authority derives solely from court appointment, so immediate action not possible.
Duties of Personal Representative• Steps:
1. gather up the estate;1. valuation2. inventory
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2. settle debts, taxes, legal action etc. 3. distribute specific gifts;4. distribute remainder of estate.
• Conduct of the body (cremation/burial/funeral arrangements). BN: WM’s ‘wishes’ are not legally binding - sometimes it can be impossible/onerous. (Final wishes are usually honoured. If executors quit, funeral home will allow next-of-kin to take care of funeral arrangements. Banks will freeze bank account except to allow funeral expenses. If you’re next-of-kin and you don’t want to do it, you can send all docs to PGT and they have discretion on whether to do it. If all fails - estate escheat? )
• Maintain and protect assets (including home). • For property:
• insurance - vacancy can void a policy. • consider changing locks - who has the keys?
• mail rerouted - PO requires change of address form and statutory declaration signed with a certified copy of death certificate.
• CPP Death Benefit application — online form/funeral home may assist. • Inventory of Assets:
• current affidavit of executor — promises a true and complex inventory and accounting• new affidavit of Applicant for Grant — promises “an accounting”.
• Distribution of property prior to the Grant should be done with utmost caution• mementos taken by family members• donations to charities/thrift stores• disposal.
***PRACTICE POINT:
• Reporting letter - addresses: retainer, trustee/executor fees, expenses, income taxes (personal liability to executor), and remuneration.
• Discuss with executor possibility of any B making claim afterwards of unfair treatment. • Recommendation: consent forms cross-referencing each person’s items and consent to each. • Review of will - executor should bring original will and death certificate to initial appointment.
Examine will as to execution, witnesses signatures, attestation clause, and discuss with executor of concerns re WM — capacity, influence etc. Codicils or new will made shortly before death should be flagged.
Asset Determination• Executor should collect old bank statements, investment company statements, property assessments,
life insurance documents, vehicle registration, pension plan statements. • Write to possible asset holder, providing copy of death certificate and asking for information on
assets. • Some asset holders will not provide information w/o separate written consent of Executor - TD
Canada Trust• Some asset holders will not provide information until you and executor have completed their
specific consent form - ING Bank. • Bank information:
• Balance at date of death on all accounts held.
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• Joint accounts information in light of Pecore (Pecore - joint assets between anybody other than spouses is not necessarily considered to be JT - depends on use of assets.)
• Accounts with named Bs• Accrued but unpaid interest at the date of death. • Debts owing to asset holder (lien of credit, personal loan, credit cards)• Safety deposit box held by deceased.
• Real property• assessed value• fair market value (appraisal vs. real estate agents)• title search• check for financial encumbrances (If mortgage send executor to bank to discuss payments — If
non-payment, banks may put property into default. Also inquire as to any life insurance for mortgage. Note: mortgage is deductible against gross value of estate).
• Vehicles• Estate of small value (25k v. 50k) do not require probate. ICBC has form that must be completed
to transfer vehicle. • Estates of greater value - ICBC does not allow transfer until grant of probate is issued except by a
letter of undertaken from legal counsel. • Evaluation:
• determined by online searches (Autotrader), ICBC book value, or by valuation by a dealer but is ultimately a statement by Executor.
• vehicle loans may be deducted against value. • realize that vehicle will probably sit for 3-6 months if waiting for grant before sale - possible
decrease in value an insurance needs to be maintained. • Personal Property
• Executors should determine items of any particular value in personal property of deceased. • “Garage Sale” prices — 10% on dollar or less. • Jewellery (take down to jeweller who will value it at replacement value but E probably won’t be
able to sell the items for that much)• artwork (WM should provide list of resources to E)• coin collections (need an ascribed value - reality) • collectibles • shares in a private corporation.
• Liabilities• Any debts owing by deceased as at date he passed plus funeral expenses including those
subsequently paid e.g. utility, phone, internet, income tax, overdue vehicle loan payments, overdue mortgage loans payments, overdue rent.
• If anything to do with income taxes - talk to accountant first not to CRA. • Gross value/ net value calculation of probate fees.
***PRACTICE POINT: Probate fees are approximately 1.4% and the value of the property put in disclosure information in application will be the source of calculating probate fees. Include both pieces of information regarding value of property.
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Remuneration • may be provided in will• otherwise can apply under s.88 of Trustee Act (fees based on estate’s value — capital fee-gross value;
income fee-any income gained in period of administration; and care and maintenance fee for administrating the estate).
• Bs can agree on amount
Formal discharge:Upon completion of duties, apply to court for order — protection from future liability.
Renunciation• Once executor has “meddled ” with the assets or held himself out to be the executor will not easily be
able to remove himself from the position. Appointed executor(s) must consider as soon as possible whether they wish to renounce the appointment.
• If the client has not meddled he or she can renounce the appointment as executor (WESA 104). • WESA 157 (1) The personal representative of a deceased person may apply to the court to be
discharged from the office of personal representative.• Renunciation must be unconditional and requires signing a document that is submitted to the Court
along with application for Probate (FP17 - new form under WESA) (WESA 104).
APPLICATION PROCEDURES FOR PROBATE
Current Practice• EAA requires notices sent to named B, intestate Bs, and those entitled under WVA - in practice this is
done by lawyer• Send: notice of application, copy of will, and letter. (Give time frame in the letter for how long it takes
for probate).
Affidavits1. Affidavit of Executor
• name, addresses, occupation• prior named executors if not acting and why• if a spouse that not separated or unable to act by virtue of divorce• Confirm will provide a “true and perfect inventory” and “complete accounting”• Submit the will• Submit assets, liabilities, and distribution.
** Practice change : Current schedule of assets, liabilities, & distribution sets out who gets what under will; New schedule of assets & liabilities - distribution no longer required.
• Possible practice point - have client sign a doc of distribution as the will sets out. • Currently the Statement of Assets, Liabilities, and Distribution also requires identification of any
safety deposit box (if yes, then where and what number)• Safety deposition boxes - frozen just like bank accounts except to remove original will - need to
check for codicils etc. • Bank staff will inventory and executory may need to arrange valuation of contents.
2. Affidavit of Notice and Will
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• Confirm names and addresses and relation to WM of intestate B• Confirm names and addresses and relation to WM of those entitled to claim under WVA• Confirm name, addresses, information of spouse, common law spouse, and spouse separated
form more than 1 year. • Confirm any party who is a minor or “mentally disorder” • Notices sent or instructed solicitor to send notices to all.
3. Affidavit of Solicitor • Normally used as person to send notice sent to B, intestate B and possible WVA claimants. • Also address any unusual points such as:
• PGT requirement• Missing B• Missing individual who is entitled to notice• Delay in bringing application.
Notice• Missing Non-B or B
• efforts made to locate: friends, relatives, previous employees, newspapers, skip trace services, Facebook
• If nothing then will requires an Order to waive the notice to that individual *WVA implications• Charity as a Beneficiary
• name changes, address changes, possible tax consequences for the Estate if registered.
Additional Documents1. Requisition - summary of documents submitted and order/grant requested2. Vital Statistics Will Search results3. Response if provided from PGT4. Copy of Will (for attachment to grant)5. Copies of assets & liabilities for certification6. Calculation of probate fees7. Fee of $200. 8. Draft order if required.
**If RRSP going directly to B - cannot take probate fees from that. Only can do that if it is coming to the estate.
Submission to Registry• Location of Registry (can file anywhere). • Processing Time• Real Estate transaction pending grant• Grant issuance by Judge • Time to return• REPORT TO CLIENT.
Transition• Old practices for anyone passing before March 31.
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• WESA 185 – Part 2 [Fundamental Rules], Part 3 [When a Person Dies w/o a WIll] and Part 6 [Administration of Estates] apply in respect of death occurring on or after the date on which those Parts come into force.
• Changes in new rules:1. notice of application must be made not less than 21 days before submission of application to
Court (no prior time requirement)2. More parties are entitled to receive notice.• **a party can impose a caveat - this can delay probate.
• WESA Standard Application:1. Notice of Proposed Application in Relation to Estate (FP1)2. Submission for Estate Grant (FP2)3. Affidavit of Application for Grant of Probate or Grant of Administration with Will Annexed (FP3)
(no issue as to content validity)4. Affidavit of Delivery (FP9)5. Affidavit of Assets and Liabilities for Domiciled Estate Grant (FP10).
PUBLIC GUARDIAN AND TRUSTEE (PGT)
Current Practice:• If there is a minor or “mentally disordered” person then a copy of the application must be sent to the
PGT for review. Fee - $336. • They require: notarially certified copy of death certificate, notice of intent to apply for probate, copy
of order, copy of requisition, will search, signed copy of affidavit of notice (EAA s.112), signed copy of affidavit of solicitor (EAA 112), and copy of probate fees calculation.
• Processing Time — expect 2-4 weeks and possible requests for further information. • PGT will issue letter with their position as to grant of probate issued and conditions if any they want
imposed • PGT = passing of accounts.
***PRACTICE POINT:
• If disabled person received his shares directly from estate, they will have their benefits disqualified. When parents are looking at providing for disabled child - look at trust provisions either trust in the will or create an inter vivos trust before a will for the purposes of shielding that money from government clawback. — Executors as settlors can create a trust & have that money go into the trust.
PGT & WESA• WESA 181 (1) If someone is mentally incapable, notice is to the individual’s nominee being the
Committee, Attorney under an enduring Power of Attorney, or a representative with authority for financial affairs
• WESA 182 (1) – if a person entitled to notice is a minor, the notice is required to be given to every guardian of the minor (i.e. both parents)
• PGT to also receive notice in either case• Change: PGT NOT notified of benefit for minor is provided though a trust with a named trustee (save
the money and delay and don’t have to have them keep tabs on you.)
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CHAIN OF EXECUTORSHIP• Executor of deceased executor• WESA 145. If a deceased WM was an executor of a person who died before the WM, the executor of
the deceased WM has all the rights, powers, rights of action and liabilities of the deceased WM with respect to the estate of the deceased person.
• (If you’re an executor and you don’t get your job done and there is no alternative - then your own executor will be responsible to get done what you didn't get done).
POST GRANT
Challenge to Will• Time for filing under WVA runs 6 months from grant of probate. • Date of issuance by the judge or by the clerk.
**PRACTICE POINT:• Search Court Registries before telling client to go ahead. • New requirement to serve w/in 30 days after 180 days.
Early Distribution• Option to Executor (completely discretionary) to distribute some portion before WVA period lapses• Consent and waiver of WVA rights mandatory• Acknowledgement of right to obtain legal advice with respect to WVA rights• No distribution until all consents received• Holdback significant “cushion” for taxes.
Income Taxes• Executors will be responsible to file final income tax filings and any ones deceased failed to file. • Income Tax Return
• Individual Return• Clearance Certificate• Estate Return
• CPP Death Benefit • property sold for increased value from amount on Disclosure• Increases in investments before liquidating
Advertising for Creditors• Currently: Section 38 of the Trustee Act • publishing once in the Gazette and twice each week for 2 consecutive weeks or once a week for 4
consecutive weeks in a newspaper published or circulating in the county in which the debtor or the person deceased resides or resided
• B.C. Gazette – $52.55• Newspapers – $150+
Executor’s Year• Common expression used to describe the typical amount of time an estate takes
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• Taxes will often be the biggest delay, particularly the clearance certificate
Common Form Grants of Probate and Grants in Solemn Form• Common Form Grant — after submitting will, getting inventory, giving notice, you get this document
that says you get probate, that all the estate devolves to this named executor/administrator. 90% of wills probated in Canada just go through this. It’s administrative issuance of probate upon submission of will, putting assets in hands of named party.
• Grant Probate in Solemn Form — where there is a contest over the validity of that will and it’s decided by court through litigation, what is issued is a grant probate in solemn form (a court confirmation after a review of evidence that the will is both formally and substantively valid). This is then entirely determinant.
• At any point, a common form grant can be superseded with an application to declare that will that’s been probated is invalid and for it to be replaced by a solemn form grant of some other will or a declaration that there was an intestacy.
REPORTING LETTER TO CLIENT• Certified copies of the Grant - do not give the original to them (in the event it has to be returned to
Court)• Caution about :
• income taxes completed• clearance certificate provided• tax advice from accountants not from me• expenses not claimed until accounting to B• Advertising for creditors.
• B have to sign off before they take money out of the estate.
FINISHING THE JOB
General• A PR (Executor or Administrator) needs to be discharged as PR. For formal discharge by court, PR must
account to residual Bs and if applicable: unpaid legatees, unpaid creditors, successor trustees, etc, i.e. anyone else claiming an interest in Estate.
• Duty to account ceases when payment is made to creditor, legatee or when interests of a 3rd party in the assets of the deceased have been satisfied. (If abatement, they may want to review the accounts).
• Accounting — detailing all assets received and disbursed, balancing with assets remaining on hand. • Starting with the date of death. Keep all receipts, records, & materials to prepare full accounts. • A duty to account does not create a right of a B to seek disclosure of trust documents. See Schmidt v.
Rosewood Trust Ltd..
Passing Accounts(1) by approval of all Bs (3rd parties involved) OR(2) by Court application if
1. a B refuses to approve2. a B is a minor
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3. a B is unascertained. • By Consent and approval of Bs
• approve the accounts presented• approve the discharge of the PR• approve the distribution of the Estate (proposed)• If appropriate waive Variation rights (WVA)• advice to seek own legal advice.
• By Court Order• Unless a B applies to the Court and requires annual accounting, the PR must pass accounts w/in 2
years from the date of grant and thereafter as Court directs. • Trustee Act 99 —
(1) Unless his or her accounts are approved and consented to in writing by all beneficiaries, or the court otherwise orders, an executor, administrator, trustee under a will and judicial trustee must, within 2 years from the date of the granting of the probate or letters of administration or within 2 years from the date of his or her appointment, and every other trustee may at any time obtain from the court an order for passing his or her first accounts, and he or she must pass his or her subsequent accounts at the times the court directs.
(2) Despite subsection (1), an executor, administrator and trustee, including a judicial trustee, if so required by notice served on him or her at the instance of a person beneficially interested in the property covered by the trust, must pass his or her accounts annually within one month from the anniversary of the granting of the probate or letters of administration or of his or her appointment, but the court may on application make an order it considers proper as to the time and manner of passing the accounts.
(3) If an executor, administrator or trustee fails to pass any accounts under this section, or if his or her accounts are incomplete or inaccurate, he or she may be required to attend before the court to show cause why the account has not been passed or a proper proceeding in connection with it taken and proper directions may be given at chambers or by adjournment into court, including the removal of a trustee and appointment of another, and payment of costs.
• Failure to pass? Court may require personal attendance to show cause why not.
Steps• Rule 25-13(1) - initiate proceeding by interested party or PR• Rule 25-14 - file a notice of application w/in the Estate file with the fee
• Affidavit in support of application P38• Statement of account affidavit P40• If by non-Pr, then an affidavit explaining why accounting requires.
• Rule 24-14(5) — service on all Bs (whether consenting or not)
Choice2. Court may use Rule 25-13(3) to hear and decide any matter relating to the accounts” and combined
with 24-14(8) use discretion to resolve any issues in dispute in a summary manner; OR3. Refer the accounts to the Registrar with directions regarding parties, evidence requires, document
discovery and issues for determination.
Form P40 • a statement of account affidavit that describes the assets and liabilities from the date of death to a set
date (reasonably close to time of application) or last court approved date. • Affidavit sets out in chronological order the transactions, distributions, remuneration (trustee fees),
other details by schedules.
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Registrar’s Reference• WESA has a default rules that the Registrar will certify the results of the inquiry, assessment or
accounting by certificate (P39) and remove the previous requirement for confirmation hearing by the court but the certification must be order as part of the Registrar’s Reference.
• Registrar may require a pre-hearing conference and make various directions about documents, reports etc.
• major centres it is more common, for some Registrars, even mandatory• Purpose to narrow the issues, identify witnesses, confirm length of hearing, potential to encourage
settlement• NOTE: likely will be a Master as Registrar• If the accounts are only being passed by the Court b/c a minor B is involved and all other adult Bs have
consented to the accounts and to the remuneration, a summary application may be brought.
Hearing in front of Registrar• Requires Hearing Record being a filing of all documents, affidavits of service, documents to be relied
on in the hearing and lists of authorities but not case law, legislation or excerpts unless with the consent of both. all parties
• testimony by PR and review of accounts• XE of PR• other witnesses• legal accounts reviewed.
Costs of Passing of Accounts• PR is generally entitled to be indemnified unless conduct was reprehensible and “deserving of rebuke”
(Bigras v. Bigras Estate)• Court can order the PR to be personally liable for the costs if the accounts are wholly inadequate. • B who causes application w/o cause may be denied costs and application costs will be charged out of
his/her share of Estate.
**When you get a grant of probate, counsel usually sends off a copy of the grant along with a copy of will to the bank — to unfreeze the assets.
Reference Results• If the Registrar certifies his/her results, the certificate is filed and binding. • If not certified, then application to the Court to confirm the results by Registrar.• Notice of application needs to include application for discharge and cancellation of bond if applicable
and certificate will stipulate.
Discharge of PR• When PR has paid and settled all debts/claims, completed distributed, accounted and obtained
releases, obtained the clearance certificate, s.157(3) process allows the PR to apply to court to be discharged.
• File for desk order a requisition, supporting affidavit and draft order or by notice of application.
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CHALLENGES TO WILL • “If the court comes to the decision that adequate provision has not been made, then the court must
consider what provision would be not only adequate, but just and equitable” — Walker v. McDermott, [1931] SCC.
LEGISLATION• WESA 60 Despite any law or enactment to the contrary, if a will-maker dies leaving a will that does
not, in the court's opinion, make adequate provision for the proper maintenance and support of the will-maker's spouse or children, the court may, in an action by or on behalf of the spouse or children, order that the provision that it thinks adequate, just and equitable in the circumstances be made out of the will-maker's estate for the spouse or children.
• WESA 61(1) (a) — action must be commenced w/in 80 days.• WESA 62 — court can accept evidence regarding WM’s making of gifts OR for not making adequate
provisions including written statements of WM - - weight must be assessed in light of all circumstances.
• WESA 63 — court can attach conditions to an order made under s.60 — can refuse in favour of person based on their bad character or conduct.
• WESA 64 — provision can be a lump sum, periodic or other payment, or transfer of property. • WESA 65 — payments ordered under s. 60 fall rateably on the WM’s estate.
WILLS VARIATION APPLICATIONS• Only spouses (married or CL 2 yrs) and children (biological & adoptive) can bring an action for variation
— not step-children (McRea v. Barrett).• Goal of wills variation: “adequate, just and equitable” provision for spouse and children vs.
testamentary autonomy. • Test for wills variation in BC is NOT needs based — though may still be relevant (Tataryn).• While WESA protects both interests of “adequate, just and equitable” provision for claimants and
testamentary autonomy, the former interest is paramount. Testamentary autonomy should yield to adequate, just and equitable provision for dependents, if contemporary standards deem this to be necessary.
PROCEDURE1. File a notice of Civil Claim - NoCC2. If challenging the will to be proved in solemn form then cannot bring a WVA application (requires
valid will to make the WVA claim)3. Serve the spouse and al children, beneficiaries under the Will, Executor and any other person the
Court may order. 4. Consider applying for an order to bind land (CPL) so that it does not get sold off by the Executor.
**Practice point: Bring the Proof in Solemn Form application first.
LEGAL TEST (Tataryn)
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• Test is “judicious father of a family seeking to discharge both his marital and parental duty” and is laid out in Walker v. McDermot.
1. Test is objective — to be assessed in light of current societal noms;2. First legal obligations will be considered — both statutory (Family Law Act, Divorce Act) and CL (e.g.
constructive trust, unjust enrichment); (Consider how a court would divide the assets in the event of a divorce under the FLA)
3. Then moral obligations — no clear test — society’s reasonable expectations — assessed in light of testamentary autonomy;
4. If estate is big enough, both legal and moral claims should be met - size of estate relevant to what’s adequate and proper.
5. Competing moral duties — spouses & dependent children rank above adult independent children. 6. Many ways to do this — so long as WM has selected an option that meets moral & legal duties, WM
given deference.
SPOUSAL CLAIMS
Determining Spousal Status• WESA 2(1) Unless subsection (2) applies, 2 persons are spouses of each other for the purposes of this
Act if they were both alive immediately before a relevant time and(a) they were married to each other, or(b) they had lived with each other in a marriage-like relationship, including a marriage-like
relationship between persons of the same gender, for at least 2 years.• WESA 2(2) Two persons cease being spouses of each other for the purposes of this Act if,
(a) in the case of a marriage, (i) they live separate and apart for at least 2 years with one or both of them having the
intention, formed before or during that time, to live separate and apart permanently, or(ii) an event occurs that causes an interest in family assets, as defined in Part 5 [Matrimonial
Property] of the Family Relations Act, to arise, or(b) in the case of a marriage-like relationship, one or both persons terminate the relationship.
• “marriage-like” — undefined in WESA. • Factors: shelter; sexual and personal behaviour; services; social, societal, and economic support;
and children (Gostlin v. Kegin (1986 BCLR). • A variation applicant may not have statute as a CL spouse where applicant and deceased did not
reside together and did not financial rely on one another, and where neither party made a formal declaration to any bureaucratic or private authority with a legitimate interest in a person’s status that they were living in a CL relationship (Jannus v Lachicki, 2001 BCSC; Harris v. Wille Estate, 2001 BCSC).
Legal Obligation: Division of Property under Family Law Act• family property (owned by either or both spouses at time of separation in which at least one spouse
has a beneficial interest) is subject to prima facie equal division . • “excluded property” — includes gifts, inheritances, insurance proceeds, and property held in trust in
which a spouse is a beneficiary and where the trust was settled by some person other than the spouse and where the property was not contributed to by the spouse. Only growth in value of excluded
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property during the relationship is subject to division. The original value of the assets brought into the relationship remains with owning spouse as excluded property.
• Threshold for unequal division — where equal division would be “significantly unfair” and not simply “unfair”
Moral Obligation to Spouse• Based on “society’s expectation” — includes need of spouse. (Allchorne v. Allchorne Estate, 2005
BCSC — deceased had stronger moral obligation to husband than to children b/c husband had very modest income and little cash. When husband no longer physically able to live on his own, he would have to pay for alternative accommodation).
• Length of marriage, efforts of spouse in care of WM, and contributions made by spouse to WM’s acquisition of assets may increase obligation;
• The assessment of the moral obligation owed to a spouse ought not to be influenced by the fact that spouse may not personally use the assets awarded (Mars v. Blais, 2011 BCSC).
• Second marriages - modern trend away from older authorities that found 2nd marriages were irrelevant in determining entitlement in wills variation claim. Moral claims of WM’s children from 1st marriage may, depending on the circumstances, rank ahead of moral claims of 2nd spouse (Saugestad v. Saugestad, 2006 BCSC).
• Moral claims of adult independent children could not be substantially preferred to moral claims of long-term, caring, dedicated CL spouse (Picketts v. Hall Estate, 2009, BCSC).
Specific Considerations in Spousal Claims• Conduct during relationship
• conduct of spouse used as factor (Steernberg v. Steernberg, 2006, BCSC). • conduct after WM’s death not relevant in wills variation claim (but relevant for costs)(Sammon v.
Stabler, 2000, BCSC; Handlen (Guardian ad litem of) v. Handlen Estate, 2001, BCSC). • Separation/commencement of divorce
• separated spouse legally married to WM at death — has standing to apply for WV. • Fact that spouse has commenced divorce proceedings did not generally constitute disentitling
conduct w/in meaning of WVA in absence of further exacerbating circumstances (Granbfield v. Williams (1981), BCLR).
• Agreements to preclude clams• Agreement that bars claims under WVA or WESA does not oust court’s jurisdiction under WESA —
against public policy to allow parties to contract out of court’s discretionary jurisdiction in socially remedial legislation (Re McNamara, [1943] BCCA).
• However, it is a relevant factor in assessing adequacy of will provisions (Boulanger v. Singh (1983) BCSC; Morgan v. Pengelly Estate, 2011, BCSC).
• Agreement may be upheld where:(a) agreement was negotiated w benefit of legal counsel and;(b) agreement for division of property and/maintenance meets legal obligations of parties to
provide for the other under family law requirements. • Marriage agreements must operate fairly at time of distribution to be enforceable (Ward v. Ward
Estate, 2006, BCSC).
ISSUE CLAIMS
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General• Equal division among children = prima facie fair. Absent relevant reasons for unequal division, there is
reasonable expectation that adult children will share equally in parents’ estate (Ryan v. Delahaye Estate, 2003, BCSC; Laing v Jarvis Estate, 2011, BCSC).
• WM has right to prefer one child over another (Cavadini v. Mahaffey Estate (1995) BCCA; Tamboline v. Dobbs Estate (1998), BCSC).
• Parent can prefer younger children from one (2nd) spouse over older children from another (1st spouse) where setae was largely created by 2nd spouse (Scott-Polson v. Henley, 2013 BCSC).
• Grandchildren — not owed any moral obligations and would stand secondary to child’s claim (Tomlyn v. Kennedy, 2008, BCSC).
• Provision in will that revokes a benefit to a beneficiary who commences wills variation proceedings is contrary to public policy and therefore void (Bellinger v. Nuytten Eestate, 2003, BCSC).
Test for Assessing Adequate Provision• Assessed at date of of WM’s death on basis of circumstances that existed then and those that were
reasonably foreseeable as likely to occur in the future (Kelly v. Baker, (1996) BCCA; Dunson v. Dunson, 2012, BCSC)
• Equal division among children = prima facie fair. Look at legal and moral obligations. • Minor, dependent children
• owed both legal and moral obligations. • claims take priority over financially independent spouse (B.(K.D.M.) v. Taylor, 2008, BCSC). • If will provides sufficient assets to surviving parent to provide property maintenance and support
of infant child, court will not vary will in favour of infant child (Cameron v. Cameron Estate (1991) BCSC)
• Adult, independent children — usually not owed legal obligations unless child made contribution to WM’s estate or has claim for unjust enrichment, constructive trust, or quantum merit for serves rendered.
• Disabled applicants — will may be varied in consideration of health and physical and mental capacity of dependants (Woods v. Davy, 2002, BCSC)
Moral Claims of Adult Independent Children (McBride)1. contribution & expectation — strengthens moral claim; may also found claim on unjust enrichment,
constructive trust, or quantum meruit.2. misconduct/ poor character — judged up to date of death, not after. WESA 63(b) — court can refuse
to vary will based on applicant’s bad character or conduct.3. estrangement/neglect — court will look at role WM played. 4. gifts/benefits made during WM’s lifetime — may diminish or negate a WM’s moral duty. 5. Unequal treatment of children — equal treatment is prima facie fair — may take into a/c inter vivos
gifts. 6. WM’s reasons for disinheritance — moral duties can be negated by valid and rational reasons for
disinheritance — based on true facts and logically connected. 7. Effect of taxes.
PROPERTY AVAILABLE TO SATISFY CLAIMS• Essentially if property isn’t disposed of via will, court doesn’t have the power to order variation.
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• — only those in Estate and specifically real and personal property over which BC courts extend authority.
• Excluded property:• Not those held in JT• not assets in an alter ego trust• not insurance policies with designated Bs• Not pension fund, RRSP or RRIF or TFSA’s with Bs stipulated.
• However,• assets passing outside estate can be considered on a WVA in review of what WM considered as
part of the “just, adequate, and equitable” for claimant. • Practice Point: Further cause to reference in Will — reasons for decision-making by WM.
• Transfers outside of will can include alter ego trusts — will variation isn't meant to enable family members to attack valid inter vivos transfers — transfers will stand if done w/o fraudulent intention to defeat spousal claims (Meshen).
Tataryn v. Tataryn, 1994 SCC - test: legal/moral duties — variation 100%F: Traditional marriage, 2 sons. Assets amassed over 43 years. T sought to disinherit one son. To ensure wife didn’t give him money, T set up a spousal trust. Favourite son made executor. Wife given LE and B of the trust. Wife applied for wills variation. H: Wife given 100% of estate (with each son getting a gift of 10k)A: Legal: wife entitled to at least 1/2 + maintenance — Divorce Act and FRA; Moral: wife outlived husband & estate was meant to support them in their later years.
Bridger v. Bridger Estate, 2006 BCCA - spouse vs adult kidsF: second marriage lasting 38 yrs. Each spouse had own children. Each brought assets to the marriage, kept separate finances, and had wills that did not provide for the other. Spouse vs. independent adult children. H: Even though legal duties met, moral were not — variation 25% to Mrs. B. A: Legal: no maintenance needed, but would’ve been entitled o 1/2 assets (which she had); Moral: Mrs. B’s knowledge contributed to Mr. B’s estate; he accumulated assets secretly; she cared for him at home (which saved him money).
Saugestad v. Saugestad, 2008 BCCA - F: 2nd wife of 11 yrs given JT in home, pension of WM, RRSPs and bank a/c but no provision made for her in will. Brought 225K into marriage and was left with $950k. Entire estate to be split b/w WM’s 2 sons. Wife applied for variation. H: Court gives small variation — outright interest in condo. A: Moral: Sons = 100% of their mother’s estate went to WM; WM’s support during his lifetime created a legitimate expectation that they’d receive bulk of estate.
Picketts v. Hall Estate, 2009 BCCA - moral duty > legal dutyF: 21 yr marriage-like relationship. Very large estate. P left family home, monthly stipend, use of condo in Hawaii — residue split 40/60 b/w 2 adult independent sons. TJ gave variation but found no legal duties were owed to P under FRA, so award was relatively small. Appealed. H: $5m outright award based on moral duties owed. P entitled to her own estate and testamentary autonomy. A: Legal: Obligation to CL spouse was limited to spousal support under FRA; Moral: Long-term relationship; H had initially said he was going to marry P, then promised to take care of her; P quit her job; P contributed financially to household expenses & provided care to H; no legal duties owed to the adult sons; size of estate enabled large award.
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Waldman v. Blumes, 2009 BCSC — moral oblig minors > moral oblig to adult childrenF: 20 yr marriage. WM leaves entire estate to spouses. Variation claim brought by all the kids — 2 teenage sons from 2nd wife & 4 adult kids form 1st wife. 2 of adult kids had financial need. A: Legal: Wife— lengthy marriage, encouraged to work part-time, contributed financially, managed biz for less than market-value, added inheritance to estate. Sons — as minors, maintenance owed. Moral: Wife — estate was for both their old age, had sons together ,although B was older. Sons — financial assistance while pursuing education & getting started in life, sons assisted in caring for father. Kids — many assets accumulated during their mother’s life, estate grew in size since the last time they received financial help, 2 had financial need. Estate large enough to make a gift.
McBride v. Voth, 2010 BCSC - “practical disinheritance” F: 3 adult children - K1 lives at home w mother. In will, mother leaves home to that chidl to live in for as long as she payed taxes, insurance & maintenance. After, sale w/ proceeds split 3 ways. Essentially left the 2 kids with nothing. H: Variation — home to be sold on 3rd anniversary of death — also varied the % that kids were to receive: 45% (K1); 30%(K2); 25% (K3). A: Moral: K1 contributed financially and cared for her mother; K2 had financial need.
SOLICITOR-CLIENT OBLIGATIONS• SCP continues after WM’s death. • Lawyer had right and duty to protect client’s privilege. Before Lawyer hands over WM’s file to
Executor/Administrator he/she must ensure will has been submitted to probate and Executor/Administrator has been validated (Cardinal v. Tassone, 2013 BCSC).
• Lawyer should do careful paperwork — if potential conflict of interest — advise client to seek independent legal advice.
• ***POSSIBLE ETHICS QUESTION ON EXAM
Romans v. Tassone, 2009, BCSC – F: Named executor and B sought to set aside a property conveyance made by WM in favour of his friend some years before the will and sought production of the solicitor’s entire file in relation to WM. She also sued solicitor. Executor and B was the decades-younger caregiver of W. Both solicitor and friend questioned validity of will and asserted undue influence on her part. The solicitor went so far as to file a caveat in this regard. Caveat specifically alleged that due to invalidity of will, named executor had not authority to waive privilege over the file or to receive or review the privileged and confidential material in his possession. H: Solicitor had the right and duty to protect client’s privilege for benefit of estate’s Bs and he was entitled to demand that the executor seek a grant of probate in solemn form.
Cardinal v. Tassone, 2013 BCSC 609 — SCP & if will called into q it has to be proved in solemn form. F: • WM left will dated Nov 5, 2004, in which he named his “friend” Carole Cardinal as executor and sole B. However, in 2002 WM
had conveyed property in which he resided to Tassone for $10k, while retaining limited interest lasting up to 10 yrs. WM represented by William Murray in that transaction.
• Tassone brought action for possession of property. In response, Cardinal brought actions against Tassone and Murray. She claimed Tassone had taken advantage of WM and alleged professional negligence against Murray. She then brought application for disclosure of documents “Conveyance Action”. Murray claimed SCP in not giving up the documents. He was granted a stay of all issues pending the obtaining of letters patent which required Cardinal to commence action for probation w/in 6 mths.
• There was evidence of suspicious circumstances with respect to execution of will and court asked that will be proven in solemn form. This was not done.
• Instead, Cardinal applied for grant ad colligenda bona w/o bond. (Cardinal needs grant to retrieve and preserve assets of estate. Grant would include power to waive SCP or any other privilege or confidentiality of estate).
I & H:
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Does Murray have standing to make submissions? Yes, b/c of the related Conveyance Action brought by Cardinal. Application for grant ad coligenda bona w/o bond? Denied. Application to lift stay and dismiss Conveyance Action for want of Prosecution? Delay by Cardinal has been inordinate and inexcusable, defendants have shown actual prejudice which has not been rebutted by Cardinal — Conveyance Action dismissed.
COURT COSTS
Costs follow the event
The Rule in Mitchell v. GardAsk: whose fault was it that they were incurred? If the fault lies at the door of the testator, his testamentary papers being surrounded with confusion or uncertainty in law or fact, it is just that the costs of ascertaining his will should be defrayed by his estate.
If the party supporting the will has such an interest under it that the costs, if thrown upon the estate, will fall upon him, and he by his improper conduct has induced a litigation which the Court considers reasonable, it is not unjust that the estate should bear the costs of the litigation which his conduct has caused.
Todd v. Walker 2009 BCSC: Loser pays the winner’s court costs
Application of the RuleIf a party cannot persuade the court that he or she falls w/in the exceptions set out in Mitchell v. Gard, the normal rule for costs should apply.
Exceptions to the Rule(a) WM was the cause of litigation (e.g. will was ambiguous);(b) challengers to will were ‘forced’ into the litigation by highly suspicious circumstances surrounding
execution of will, and/or by action taken by primary B of will. (c) Unsuccessful undue influence claims may lead to an award of special costs against the party (b/c of
serious nature of claim).
Tailoring the Property Costs Award1. What issues are raised at litigation?2. What was the result?3. Conduct of the parties4. Settlement offers5. What scale of costs?6. Should there be different costs awarded for different phases/issues?7. Source of costs award8. What party?
1. Rule: Personal rep is entitled to be indemnified by estate (unless acting unreasonable and stonewalling reasonable requests for information)
Costs in Non-Wills Variation Litigation
Rule: Costs follow the event in estate litigation cases that were adversarial contests (Woodward v. Grant, 2007, BCSC; Maddess v. Racz, 2009, BCSC; Mawdsley v. Meshen, 2011, BCSC).
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Lee v. Lee Estate (1993) BCLR, noted with approval in Steernberg v. Steernberg 2007 BCSC
The general rule is that costs follow the event and, while a court may depart from this rule, any departure is usually in the way of depriving a successful party of costs and not of awarding costs to an unsuccessful party. In either case, the usual rule should not be departed from simply because an unsuccessful party did not expect to lose ….… where the validity of a will or the capacity of the testator to make a will or the meaning of a will is in issue, it is sometimes the case that the costs of all parties are ordered to be paid out of the estate — [depends on] whether the parties were forced into litigation by the conduct of the testator or the conduct of the main beneficiaries.
But the case is different where the litigation does not relate to the validity of the will or the capacity of the testator or the construction of the will. Actions brought under dependants’ relief legislation presume the validity of the will and the capacity of the testator and that his intentions are clear. There are not doubts to be settled. The remedies provided by such legislation are directed to the maintenance and support of the dependants of the testator and are based on public policy. The legislation does not invalidate the will, it merely permits the court to vary the provisions made by the testator. So an unsuccessful action under such legislation cannot be said to have been caused by a testator, or to have been necessary to enable the estate to be distributed. The action does not benefit the estate.
Maddess v. Racz, 2009 BCSC 1550 - Costs follow the event. If you’re alleging undue influence (a serious claim) and you lose, you may bear the costs (not the estate).F: Lisa Maddess, granddaughter of WM, was Executor and a B. Lisa asked court to pronounce will in solemn form. Gidney’s (B) Estate wanted will declared void and WM’s estate be declared an intestate estate. Parties agreed to Settlement Agreement. Lisa breached Agreement by not providing a letter of credit but Elizabeth ended Agreement before due date. Parties go to trial, Lisa wins. Lisa claims costs from Etus and Gidney Estate on basis that they lost. Gidney argues litigation resulted form Rosalia’s conduct so Gidney should not pay costs. I & H:1. Court held that Settlement Agreement had no bearing on costs. 2. Did Rosalia cause the litigation or was it an adversarial dispute between Bs? It was an adversarial dispute. The rule that
costs follow the event applies and Gidney Estate pays the costs. 3. Was conduct of Ds reprehensible? Yes. WM had capacity and not unduly influenced by son. Unsuccessful undue influence
claim and length of time taken. Special costs against D. 4. Should Lisa obtain her litigation costs from Rosalia’s Estate? “Lisa is entitled to special costs from Rosalia’s estate for the
entire proceeding. She is entitled to special costs from the defendants for only half of her costs, and ordinary costs for the other half. To the extent that Lisa does not recover special costs for the entire proceeding from the defendants, Lisa is entitled to obtain them from Rosalia’s estate.”
EXECUTOR’S FEES• Entitlement to Remuneration — set out in will or an agreement between WM and PR, or apply under
s.88 of Trustee Act (“TA”). An administrator is entitled to “fair and reasonable allowance” for “care, pains, and trouble” and “time spent”.
• Amount of Remuneration: Will or agreement - limits amount; If not fixed — Trustee Act 88.• TA 88(1): Executor’s fees = max 5% of gross value of estate• TA 88(1): max 5% of income earned during the administration • TA 88(3): Annual “care and management fee” of 0.4 % of average market value of assets. • Usually - 3% of income and capital, as well as care & management fee.
• In considering the quantum of an administrator’s remuneration, registrar should consider (Re McColl Estate (1967) BCSC; Chevrefils Estate, 2010, BCSC):
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(a) the magnitude of the trust;(b) the care and responsibility of the trustee springing from the magnitude of the estate;(c) the time spent by the Administrator;(d) the skill and ability displayed; and(e) the success achieved in the administration of the estate.
• If 2 or more PR, total remuneration determined in same manner as if there had been 1 PR. • Procedure:
• Remuneration may be fixed by consent of all estate Bs; if not - court order under Trustee Act 89. • Unless court orders otherwise, costs of fixing remuneration of P, either on s. 89 application or a
passing of accounts, shall be assessed as special costs and paid from the estate (SCCR 215(2)(c) and 14-1(6); Re Kanee Estate; Szpradowski (Guardian ad litem) v. Szpradowski Estate).
• Expenses — out-of-pocket expenses in addition to remuneration. e.g. accountant (not for small and simple estates).
• **PRACTICE POINT: Keep a log book. When reviewing costs, courts can look to that and determine the effort and time used to determine remuneration.
Chevrefils Estate, 2010 BCSC 753 – F: Intestacy. After completing administration of estate, John wants to pass his accounts before Registrar and claims his Administrator’s fee of $10k or 3.3% of estate. Only one of Bs, Catherine Croft, opposed— excessive compensation relative to incompetent task done. I & H:1. Whether the accounts are to be passed. 2. Administrator’s remuneration? Set at $10,000. 3. Costs of the reference? Since the application for passing of accounts was an unnecessary expense caused by Catherine, she
was denied her share of distributable estate as her contribution to such costs.
PROBATE ACTIONS(a) Before grant:
(a) caveats — notice to court not to allow probate to be granted or proceeding to be taken with regard to a will or an estate — halts proceedings.
(b) citations — simply a summons to take some action with respect to a all or an estate. (1) citation to accept or refuse probate; (2) citation to propound an alleged will; (3) citation to bring in a will
(c) proof in solemn form — requires proof of the will in open court, after notice has been given to all interested parties — due execution of will, testamentary capacity, knowledge and approval of WM. When will has been proved in solemn form, it generally is protected by the doctrine of res judicator from attack in subsequent legal proceedings. A will proved in common form is not so protected.
(b) After grant: (a) citations (b) revocation of grant
SUMMARY OF PROBATE PROCESS1. Apply for Grant of Letters Probate/Letters of Administration
In BC - can file in any Registry2. Grant of Letters Probate/ Letter of Administration3. Gathering up estate4. Paying debts and taxes
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Taxes - need to close WM’s account at CRA and get tax clearance certificate. 5. Distribution of estate
INTESTATE SUCCESION• No will; will invalid; partial intestacy — will doesn’t dispose of entire estate; gift to B lapses & no
statuary anti-lapse provision applies. • Note: To get intestate share, intestate B — alive for at least 5 days longer than deceased. • (“descendants = all lineal descendants through all generations).• net value - value after deducing FMV
1. Household furnishings distributed to spouse;2. Charged debts, funeral, administration expenses and probate fees.
INTESTACY RULES (Part 3, WESA) • Spouse, descendants, or relatives:
• Consanguinity: (blood relation) degrees of relationship to the deceased — maximum of 4 degrees (first cousin is 4th degree)
• Spouse/children — Parents - descendants of parents — Grandparents - descendants of grandparents
• children of deceased person in category If spouse and NO descendants — estate distributed to spouse WESA 20.
• Spouse, no descendants WESA 20 – all to spouse. • Spouse + descendants:
• household furnishings + preferential share of estate to spouse — WESA 21(2).• preferential share = spouse gets $300k (if descendants are common to intestate & spouse) or
$150k (if descendants not common) — WESA 21(3) & (4).• If net value of estate less than preferential share — estate to spouse — WESA 21(5).• residue to be divided: 1/2 to spouse and 1/2 to descendants (see 24) — WESA 21(6)(b).
• 2 or more spouses — 2 or more people entitled to spousal share, they can split in agreed portions or apply to court — WESA 22(1).
• No spouse, descendants, or relatives:• WESA 23 — parentelic distribution scheme where deceased dies w/ no spouse or descendants,
parents or descendants of parent surviving him or her. If no person of 4th or lesser degree of relationship surviving the intestate, property may escheat to crown.
• descendants — surviving parents — parents’ children (siblings and *step-siblings?) — nieces & nephews — grandparents — aunts/uncles — WESA 23(2).
• If a child predeceases the deceases, child’s children share• person of 5th or greater degree of relationship are conclusively deemed to have predeceased the
intestate — WESA 23(3).• unless the estate is to go to the intestate’s direct descendants, then the 5th degree limits does not
apply — WESA 23(4).• Note: quirk in system — if estate goes to siblings, it can then go no further then their children —
WESA 24(3).
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SPOUSES• WESA 2(1) — married OR lived in a marriage-like relationship for at least 2 years.• WESA 2(2)(a) — marriages ceases if living separate & apart for at least 2 years — with the intention
(formed before or during) to do so permanently. • WESA 2(2)(b) — marriage-like relations cease when one or both persons terminate the relationship.
Either party regards relationship to be at an end, and by conduct demonstrates in convincing manner that their mind is settled (Gosbjorn v. Hadley, 2008 BCSC: end of marriage-like relationship. Deceased had 12 year CL relationship. Shortly before his suicide, G moved into basement suite with her daughter. G claimed spousal share. I: Has the relationship ended? H: No, though deceased took steps to end relationship, he failed to do so in a convincing manner. Evidence was conflicting.)
• onus on potential spouse to prove relationship. • Test (Souraya v. Kinch)
1. first look at subjective component — intention of parties. 2. then at objective indicators — shelter, sexual & personal behaviour, services — e.g.. cooking,
social, societal, children. 3. objective factors are relevant, but will rarely determine in & of themselves. 4. approach is holistic — look at all factors, no one is determinative.
CHILDREN & KIN• WESA 3(2) — adopted children not entitled to estate of natural parent (except via will) & vice versa —
includes intestate share. (BC Adoption Act s. 37 — familial links for all purposes w/ natural parent are severed and a new relationship created w/ adopted parents.)
• WESA 23(5) — half-kinship inherit equally as those of full blood. • Stepchildren — Stepchild who has not been adopted by deceased will not inherit on an intestacy
(Naples v Martin Estate BCSC). Stepchildren and stepgrandchildren are not captured by the ordinary use of “children” and “grandchildren” in a will (Re Lang Estate, 2011 BCSC).
• PGT: • If any descendants are minors, PGT must be notified and give consent to application. • Expect PGT will impose conditions, which may still be included a bond, terms for holding trust
monies and will require the Administrator to provide accounting information and pass the accounts upon completion
• BN: Under WESA - change. if you appoint a trustee for a minor, PGT doesn’t get involved anymore.
Re Kishen Singh, 1957 BCSC - half-siblings take as if full blood. F: KS dies intestate. 3 full blood siblings & 1 half-blood sibling, who herself had 4 children. I & H: Do daughters take as if their mother was full blooded siblings? yes.
Re Forgie, 1948 MNKB — can’t bequeath intestate share. F: F died intestate. 2 surviving siblings & 1 surviving sister-in-law who had 4 children.I & H: Can deceased brother’s intestate share pass to his kids (F’s nieces & nephews)? No, intestate shares do not form part of the estate of the descendant & spouse can’t take.
SPOUSAL HOME• If deceased’s interest in home (based on FMV) < $300k (or $150k as the case may be), spouse can take
home as part of preferential share.
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• WESA 31(1) — If deceased’s interest in home > spouse’s preferential share, spouse can purchase the remainder of interest from estate.
• WESA 33 — NEW (and sure to be controversial) provision gives court very wide powers to deal with spousal home.
• WESA 33(2) — where intestate estate includes a spousal home, the court can:• vest deceased’s interest in the surviving spouse;• specify amount spouse must pay to descendants for their interest (this could be nothing!);• convert descendant’s unpaid interest into charge against title;• if money owing, court can determine interest rate on loan.
• Requirements:1. Spouse must be ordinarily resident in home at time of death;2. insufficient asset to give all the descendants what they’re entitled to;3. significant hardship would result if spouse had to purchase home under WESA 31. 4. prejudice to spouse if forced to leave greater then prejudice to descendants forced to wait
indeterminate period of time.
ESCHEAT ACT• If no living relative (4 degrees distant) then government will receive Estate WESA 23(2)(f) - estate
passes to government• estate that has no known relatives may result in a genealogical search for family at cost to estate.
LETTERS OF ADMINISTRATION• WESA 130 — priority list of potential administrators:
• spouse/spouse’s nominee; adult child w/ consent of majority of siblings; intestate successor; (g) Other person court considers, including PGT
• WESA 132 — court has discretion in granting letters of administration. • Consent required from any persons entitled to share in estate who has a greater or equal right to
apply.
Challenge to Application for Administration• WESA 158 Application can be brought to “pass over” a person entitled to be PR in favour of someone
lower on list e.g. a creditor who is owed $10k or more• WESA 159 allows the Court to discharge or remove the PR and appoint a substitute with conditions
(e.g. Bond).
Authority• Administrator has no formal authority to deal with assets of Estate until grant of letters of
administration issues. • Protection/control of Estate assets may become an issue if disagreement over who will apply.
Obligations of AdministratorAdministrator deemed to be PR form date of death of deceased (WESA 135) but is NOT liable for any loss or damages occurring before effective date of grant unless was liable regardless of grant.
Upon receipt of Grant:
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1. Notify asset holders2. Pay creditors
1. issue of sufficiency of assets2. advertising for creditors (don’t have to advertise in the newspapers anymore, only in the
Gazette). 3. Offer spouse/matrimonial home to spouse for purchase
1. not sell spousal home for 180 days (time for spouse to exercise option.) 2. UNLESS insufficient funds to deal with debts of deceased.
4. Sell assets (garage sales etc)5. Deal w spousal home if appropriate6. Settle outstanding bills (accounts are unfrozen as of date of grant/ date bank receives copy)7. Address income taxes — hire an accountant. 8. Consider placement of insurance on property if spouse not involved. 9. Advertise for creditors.
1. s. 15 — only requires to advertise in Gazette, not in local newspapers — Creditor has 30days to serve notice. Administrator (or Exec) then entitled to distributed.
10. Account to B11. If a minor involved— pay under WESA 153 the minor’s interest to PGT. 12. Distribute estate shares and apply to be discharged.
** New disclosure form does not require who is receiving the estate.
Distribution• S. 74 of EAA prohibited distribution of Estate for 1 year from date of death. (This is not paying bills but
distributing estate.)• Has not been carried forward in the new act. • Will still apply for those passing prior to March 31.
Vaughan (Estate of), 1990 BC SC — residue —WM intended to ctrl estate if CL spouse died — presumption against intestacy. F: WM died, leaving will of 1986. He had CL relationship w/ Bryan, no children and no immediate family in Canada. Bryan had a child from previous relationship. WM appointed Royal Trust as Executor, and bequeathed entire estate to Royal Trust as trustee and created following trusts: All personal effects and chattels given to Bryan, failing that to her daughter Virginnia. Rest of estate was to be liquidated, debts paid, and net estate invested. Income was to be given to Bryan during her lifetime and Royal Trust was allowed to encroach upon that income to ensure that she was take care of. If Bryan predeceased WM or did not survive him by 30d WM created certain specific trusts. Bryan survived WM by 30d but has now passed away. Will did not expressly state what was to happen to residue if Bryan survived for 30d but passed awayI & H: Since Bryan has now passed away, on whose behalf does Trustee hold the Estate? Did Does residue of estate fall into intestacy to be distributed by Trustee in accordance with intestacy laws or is Trustee entitled or required to pay out residue to specific trusts already referred to in will? Court (stated that this was a case of poor draftsmanship) interpreted will to read that Bryan had a life estate, with a gift over to specific trusts already listed in will.
***upon discovery of potential legal claim - need to notify insurance co. As long as your advice is reasonable and not off target — should be okay.
Wagg v. Bradley, 1996 BCSC — Drugstore will; B stated but property not specified. F: Drugstore will. Marguerite Wagg, listed as only B but did not state expressly what property was to be given to her. Registry Staff wrote to Registrar: will valid but intestacy. I & H: Was there an intestacy? Court construed the will to read that the entire estate was to go to Marguerite Wagg.
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Bank of NS Trust Co. v. Van Raan et al., 2005 BCSC - “and his heirs ..” are words of limitation not words of purchase or substitution THF gift lapses = intestacy. F: WM died leaving will of 1976. She was 93; spouse & parents died before her, and she had no children. (2 executors, one of whom died, and other died w/o having applied for probate. Although alternate executor — incapable of applying for probate). Letters of Administration granted to Bank of Scotia Bank Trust Co. and will admitted to probate w/o any alterations.] 3/10 of residue of estate was bequeathed to brother, John, but he predeceased her. No accrual provision. I & H: What should happen to John’s share of residue, would it go to his heirs or does it lapse? It lapses and is to be distributed according to intestacy laws. A: Despite — Language used in gift to John P. Van Den Hurk is same as that used in gift to Jacqueline Fleming. On the other hand, in gift to Mildred Smircich — WM’s cousin and one of WM’s two trustees under will, there is an explicit accrual of her share to residuary estate if she predeceases WM.
Jung (Re), 1979 BCSC – In order to apply the cy-près doctrine, there must be general charitable intent. Where a foundation is named and nothing more, whether or not the foundation is charitable, there can be no finding of a charitable intent and thus the cy-près doctrine does not apply.F: WM died, leaving will in which he appointed Montreal Trust Co to act as Executor. WM created trusts, with Montreal Trust Co. as Trustee. 25% of estate + residue of estate was specifically to a charity (PA Woodward’s Foundation) which refused the bequest. I & H: What happens to the disclaimed bequest? The cy-près doctrine cannot be applied b/c there was no general charitable intent. WM merely named the foundation and nothing more. THF the gift lapses and is to be distributed according to intestacy laws.
**Note • disclaimer — refusal to accept an interest which has been bequeathed to disclaiming party. Effect is to
void gift ab initio. Where an interest is disclaimed, it is as if it had never been acquired by disclaiming party. Gifts which fail or are undisposed of are captured by residuary gifts or, if residuary fails, an intestacy results. Where a residuary gift fails, there is a resulting trust in favour of next of kin of deceased: Re Stuart Estate; Re Metcalf.
• cy-près doctrine - “as close as possible” — rule employed in construction of such instruments as trusts and wills, by which the intention of the person who executes the doc is effectuated as nearly as possible when circumstances make it impossible or illegal to give literal effect to the document.
POWERS OF ATTORNEYGENERAL• Power of attorney — attorney can make decisions in relation to legal and/ financial affairs of an adult. • Applicable legislation: BC Power of Attorney Act (“POAA”)• POAA — 2 tools: General POA and Enduring POA• POAA 10: ”enduring power of attorney" means a power of attorney
(a) in which an adult authorizes an attorney to (i) make decisions on behalf of the adult, or (ii) do certain things in relation to the adult's financial affairs, and
(b) that continues to have effect while, or comes into effect when, the adult is incapable;• Common forms of POA
• limited purpose or time — coverage for a vacation period, sale of specific item (e.g. car/property), ingoing activity w/ only 1 asset e.g. decisions on investments under xy account.
• general enduring — carrying on through donor’s mental incapacity. • general springing — comes into effect after occurrence of a triggering event e.g. incapacity.
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• escrowing EPOA — donor gives physical possession of POA to a 3rd party e.g. solicitor on instruction to release the doc to the attorney only upon the occurring of some condition. (POA held in abeyance at such time the condition is satisfied).
CAPACITY TO MAKE AN ENDURING POA• POAA 11(1) Until the contrary is demonstrated, an adult is presumed to be capable.. • Only capable adults can make a EPOA — “capable” is the power to understand the nature &
consequences of making an EPOA — POAA 12(1).• “donor must have a general appreciation of the enabling power he or she is bestowing upon the
donee of the power. The donor must be cognizant of the circumstances that the donee is being granted power to deal with the property of the donor.” (Egli v. Egli).
• POAA 12(2) — Adult must be able to understand:(a) the property the adult has and its approximate value;(b) the obligations the adult owes to his or her dependants;(c) that the adult's attorney will be able to do on the adult's behalf anything in respect of the
adult's financial affairs that the adult could do if capable, except make a will, subject to the conditions and restrictions set out in the enduring power of attorney;
(d) that, unless the attorney manages the adult's business and property prudently, their value may decline;
(e) that the attorney might misuse the attorney's authority;(f) that the adult may, if capable, revoke the enduring power of attorney;(g) any other prescribed matter.
• POAA 8 (repealed) — Loss of mental capacity of donor does not automatically void EPOA (Egli v. Egli).
APPOINTING AN ATTORNEY• POAA 18 (1) — Can name the following as attorneys: an adult (except those in next point), PGT and
financial trust institutions. • POAA 18(1)(a) — Cannot appoint individual who: (unless person is spouse, child, or parent)
(i) provides personal care or health care services to the adult for compensation, or(ii) is an employee of a facility in which the adult resides and through which the adult receives
personal care or health care services;• BN:
• Regulations s. 6 (20/2011) to POAA — if appointment of a paid caregiver as attorney was made before September 1, 2011, then named attorney may continue to act.
• Minor can be named (except if acting under Land Title Act), but authority to act will not arise until after he or she becomes an adult.
***PRACTICE POINT:• Advise client that banks may charge high fees to act as a POA. • Remember to appoint an alternate attorney. • Definition of child? Check FLA.
FORMALITIES • POAA 16(1) — EPOAs must be in writing, signed, and *dated by adults + 2 witnesses. All must sign in
each other’s presence.
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• POAA 16(2) — EPOA can be signed on behalf of adult if:(a) the adult is physically incapable of signing the enduring power of attorney,(b) the adult is present and directs that the enduring power of attorney be signed, and(c) the signature of the person signing the enduring power of attorney on behalf of the adult is
witnessed in accordance with this section, as if that signature were the adult's signature.• POAA 16(4) — only one witness required if the witness is a lawyer or notary public. • POAA 16(6) — Attorneys named in POA and their spouses, children, parents, employees or agents
cannot be witnesses, nor can minors.
POA Forms• Banks and other institutions will have internal forms that can be executed and will be referred as POA
forms• For the purpose of the Act, sample forms are provided• Document requirements - POAA s. 16 two witnesses or one lawyer/notary, signing and dated in the
presence of the parties.
THE “ENDURING PART”• General Rule: At CL, individuals can designate an attorney to conduct inter vivos dealing with their
property — but POA becomes invalid if donor becomes incapable. • POAA 14 — mandatory provision — EPOA must say:
(a) whether the attorney may exercise authority (i) while the adult is capable, or (ii) only while the adult is incapable, of making decisions about the adult's financial affairs, and
(b) that the authority of the attorney continues despite the adult's incapability.
POWERS OF THE ATTORNEY• POAA 17(1) Attorney must sign EPOA in presence of 2 witnesses before exercising power. • **CANNOT**:
• POAA 15— cannot direct attorney to act contrary to law or omit something required by law • POAA 21 cannot direct attorney to make or change a will.
• can — request delivery of property, request information or records from 3rd party (disclose only as necessary), retain qualified persons to assist them
• POAA 23 — but attorney can’t delegate decision-making authority except with regard to investments if made in accordance with legislation (e.g Trustee Act).
• POAA 20 attorneys can make make gift, loan, charitable gift• if expressly authorized• or (1) if adult made the type of gift/loan while capable + (2) sufficient property + (3) total amount
less than prescribed amount ($5000 or 10% taxable income, whichever is less). • POA must be exercised according to donor’s instructions, unless the donor is incapable — at which
point the attorney takes on fiduciary role (McMullen). • Should not use POA in a way that changes donor’s testamentary dispositions (Desharnais)
Limitations• Attorney may make gifts/loans/charitable gifts from donor’s accounts if:
• adult will still have sufficient $ to meet his own needs and legal obligations (i.e. child support)• adult would make such gifts/loans when he/she was capable.
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• total in a year less than $5k or 10% of previous year’s income whichever is less. • Cannot change B designation except by court order or replace w/ same previous B or name Estate. • Document must stipulate if attorney may receive gift/loan (amount still subject to regulations). • Document must stipulate compensation if applicable for attorney by amount/rate.
Rule against Delegation of Testamentary Power• Ask:
• (1) Does it depend up death of donor to take effect?• (2) Does it vary the disposition of assets donor intended to make upon death?
• BN: A testamentary disposition is one that is dependent on death for its vigour and effect. Where a document creates a trust that takes immediate effect, even though not performed until the death of a settlor, is not testamentary (Wonnacott v. Lowen).
• Cases where attorney’s action found to be exercise of testamentary power and so invalid:• Lawson — variation of trust was testamentary in nature b/c it altered arrangements made by
donor for disposition of assets upon his death — ON legislation prohibited use of POA to make will . • Desharnais v. TD — Under EPOA attorney transferred RRSP but left space for B blank — effect was
to change B designation so monies paid to estate. Transfer of RRSP invalid.• EPOA can be used to create inter vivos trust that is in line with donor’s intentions for disposition of
assets upon his death and does not conflict with other general principles of law or statutory prohibitions (Easingwood v. Cockroft — using general EPOA children created alter ego trust, which had same distribution of assets upon death as did donor’s will.).
POA and Land Titles• Property Law Act RSBC 1996. • No self-dealing: PLA 27 A sale, transfer or charge to or in favour of himself or herself by an attorney
named in a power of attorney, of land owned by the principal and purporting to be made under the power of attorney, is not valid unless the power of attorney expressly authorizes it or the principal ratifies it.
• PLA 27.1 Validity of sale, transfer or charge by attorney to self • (1) In this section: "agreement" means an enduring power of attorney made under Part 2 of the
Power of Attorney Act; "attorney" means a person named in an enduring power of attorney as an attorney.
• (2) A sale, transfer or charge to or in favour of an attorney by the attorney of land owned by the adult who made an agreement, and purporting to be made under the agreement, is not valid unless the sale, transfer or charge is expressly authorized by that agreement.
DUTIES OF AN ATTORNEY• POAA 19(1) — An attorney must
(a) act honestly and in good faith , (b) exercise the care, diligence and skill of a reasonably prudent person ,(c) act within the authority given in the enduring power of attorney and under any enactment, and(d) keep prescribed records and produce the prescribed records for inspection and copying at the
request of the adult.• POAA 33 — duty of non-disclosure of information unless and to extent necessary to:
(a) perform his or her duties,
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(b) make a report to the Public Guardian and Trustee under section 34 (2) or comply with a requirement of the Public Guardian and Trustee, or
(c) make an application to, or comply with an order of, the court.• POAA 19(2) — duty to act in adult’s best interests — bearing in mind the adult’s current wishes,
known values, and beliefs. • POAA 19(3)(a) to extent reasonable, give priority to adult’s personal & health care needs. • POAA 19(3)(c) foster adult independence & involve adult in decision-making.• property:
• POAA 19(3))b) — invest only in accordance with Trustee Act unless otherwise allowed (cannot invest in shares of private companies, private mortgages, ownership in child’s residence, or low interest loans to family or friends unless specifically authorized).
• POAA 19 (3)(e) keep personal effects at the disposal of adult;• POAA 19(3)(d) — don’t dispose property known to be subject of testamentary gift (unless
necessary);• POAA 19(4) — keep adult’s property separate from own property.
***PRACTICE POINT:• Since spouses usually keep their accounts together — advise client that if he or she gives spouse POA,
the spouse needs to keep records and keep accounts separate — in the event PGT asks for records for 5 years.
• ***Application to involuntarily separate — forced by house circumstances to separate. upon receipt of involuntary separation, government will do an adjustment which may result in the spouse (who was receiving less pension) to get more money.
PRIVILEGES AND LIABILITY• Remuneration
• POAA 24 — no remuneration unless expressly stated & amount specified by EPOA — but may be reimbursed for reasonable expenses properly incurred (Test: (1) Was expense a proper expense w/in attorney’s duties & powers? (2) Was amount reasonable?)
• grandfathering rules — pre-existing EPOA prior to September 1, 2011 —compensation allowed even if only general language.
• POAA 25: Resignation — by written notice to adult (or spouse, relative, near friend if incapable) — effective from date given or date specified.
• POAA 22 — Attorney not liable for loss or damage if they complied with s.19 duties or any directions under court order given under 36(1)(a) or any other legal duty.
• Criminal Code — Attorney can be criminally charged under s. 331 for theft by person holding POA and s. 332 misappropriation of money held under discretion.
REVOCATION/SUSPENSION/TERMINATION• Subject to terms, adult can revoke POA — must give written notice to each attorney — revocation not
effective until this is done. • Authority ends: POAA 29 —
(a) EPOA is terminated;(b) revocation of authority;(c) attorney resigns;
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(d) if attorney — is a spouse, at termination of marriage or marriage-like relationship; becomes incapable or dies; is bankrupt; or convicted of prescribed offices, If corporation, where ceases to do business or dissolves.
• Execution of a later POA does not automatically revoke earlier POAs (Houston). • Revocation can be implied, but it must be clear and unambiguous (Houston). • POAA 8 — Lack of mental capacity of donor does not automatically terminate an EPOA (Egli v. Egli). • Effect of committeeship order under Patient’s Property Act:
• PPA 19 — Court order granting committeeship — automatic termination of POA; continuation of RA dependent on court order.
• PPA 19.1 — Other means of committeeship — suspension of POA subject to termination by PGT and if PGT authority terminated then POA reinstated.
TRANSITIONAL - DEEMED EPOAS• Grandfathering rules apply to EPOAs executed before September 1, 2011. • POAA 42(1) An EPOA … validly made under section 8, before the repeal, on September 1, 2011, of that
section by the Adult Guardianship and Planning Statutes Amendment Act, 2007, is deemed to be an enduring power of attorney made under Part 2.
• transitional deeming provisions such as POAA 42 are effective for procedural or formality matters, but the new substantive rules will apply to the deemed instrument.
• Although the POAA 17(1) requirement that all EPOAs must be signed by the attorney prior to exercising the power may not apply to deemed EPOAs under POAA 42, for practical purposes the attorney should have the grandparented EPOA signed and witnessed.
UNDUE INFLUENCE
By Third Party• Attorney may believe adult unduly influenced by 3rd party and need to act in face of adult’s
objections. • POAA 27(1) EPOA does not in any way restrict the client’s ability as an adult to act in the same matters
for which the attorney has been given authority. • POAA 27(2) Attorneys can nonetheless act on their authority despite an adult’s objections if the adult
is “incapable when making those objections.” (In so doing, attorney must still abide by known wishes expressed when adult was capable (POAA 19(2))and, to the extent reasonable, attorney must encourage adult’s involvement in decision-making).
• Triggering statutory schemes:• arranging for adult to be declared incapable by director of psychiatric — triggering PGT’s role as
statutory appointed committee — Patient’s Property Act.• filing report with PGT - triggering PGT’s authority to freeze assets - PGT Act 19. • filing report of abuse/neglect with ‘designated agency’ — triggering investigation and possible
application to court for ‘support and assistance plan’ or in urgent circumstances, exercise of immediate ‘emergency assistance’ — Adult Guardianship Act Part 3.
• filing report with police — triggering criminal investigation of fraud. • filing report with police — triggering involuntary admission into psychiatric unit — Mental Health
Act 22.
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• filing a caveat marriage w/ Dept. of Vital Statistics if adult being coerced to enter into ‘predatory’ marriage w/ undue influence — Marriage Act 23.
By Attorney• POAA 34 — Any person can file report with PGT regarding attorney. • POAA 35 — PGT has right to review even w/o any report. • POAA 36 — on application court can order termination of POA or actions taken under it.
McMullen v. Weber, 2006 BCSC — if capable donor has autonomy to do whatever he wants w/ his property. F: Parents give 3 kids EPOA. Wife dies, husband depressed — strikes up affair w/ younger woman. 2 kids concerned about debts getting racked up, transfer title to dad’s condo. Dad finds out when he tried to borrow money against condo. Goes to court to have transfer set aside. H: Court sets aside transfer. Dad is entitled to his autonomy until he is found incompetent. Easingwood v. Cockroft, 2013 BCCA — EPOA authorizes creation of inter vivos trustF: Using general EPOA children transfer dad’s assets into an alter ego trust — trust had same distribution of assets upon death as did his will. Didn’t inform dad or wife. Dad dies. Widow claims trust invalid & applies for wills variation. H: Attorneys can create inter vivos trusts — when used as a legitimate planning tool + consistent with donor’s wishes + no reduction or adverse effect to donor’s interest + no conflict of interest.
Houston v. Houston 2012 BCCA — revocation depends on intention of donor. F: 1st EPOA allowed wife or son to act. 2nd EPOA appoint wife, son to act only if wife unable or unwilling. Son terminated JT of couples’ home under 1st POA. H: Is the 1st POA revoked by the 2nd POA? Is severance of JT valid or ultra vires? No doctrine of implied revocation. Revocation is a matter of fact — depends on intention of donor. Severance of JT not found to be a testamentary act — valid. Did James breach fiduciary duty? No, father told him to preserve his estate and protect his estate wishes. TJ found that James did not act for his own favour.
Parnell v. BC 2004 BCCA — springing POAF: Parnell granted POA to nephew, stipulated POA could be exercised only during subsequent infirmity. Parnell was incapacitated due to dementia and newphew, as attorney, entered into agreement to sell aunt’s condo. LTO Registrar rejected docs on basis that POA was not an EPOA and had expired. s. 56 states that a POA is only value 3 years from date of execution unless made under POAA s.8. G argues that it is a ‘springing POA’. I & H: Is a “springing” POA which provides that the power “may only be exercised during any subsequent mental infirmity on [the donor’s] part without establishing how that status may be established, an enduring POA under POAA s.8(1) and w/in LTA s. 56(3)? A springing POA is not precluded. The authority was given at time of execution by donor and the reservation in the POA was only a restriction as to its use. A springing POA can be an EPOA.
Egli (PGT) v. Egli 2005 BCCA — F: • Hans granted POA to son, David in 98. In 99, Hans moved into an intermediate care facility b/c of deteriorating mental
condition. David granted committeeship. David & Judy made 2 transactions which had effect of transferring almost entire estate into their names.
• PGT challenged transaction under s. 20 of Patients Property Act on basis that when Hans lost mental capacity the POA was automatically voided, therefore, the transactions are void.
• Witnesses testified as to his deteriorating mental condition in 98 & 99. Dr. Leitner, family doctor, testified that Hans did not have sufficient mental capacity in 98/99 to understand impact of transfer of majority of assets from his own name into joint ownership w/ his son. Solicitor who prepared POA testified Hans had sufficient mental capacity at time of execution.
• Patients Property Act 20 Every gift, grant, alienation, conveyance or transfer of property made by a person who is or becomes a patient is deemed to be fraudulent and void as against the committee if
(a) the gift, grant, alienation, conveyance or transfer is not made for full and valuable consideration actually paid or sufficiently secured to the person, or
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(b) the donee, grantee, transferee or person to whom the property was alienated or conveyed had notice at the time of the gift, grant, alienation, conveyance or transfer of the mental condition of the person.
I & H: EPOA is not void. Section 20 of the PPA does not include POA. Under POAA s. 8, donor’s loss of mental capacity does not automatically terminate an EPOA. Additionally, PGT has not proved lack of mental capacity at time of execution. Therefore, transfer of real estate was validly made by donee pursuant to EPOA.
*** PRACTICE POINT• Red flags as soon as attorney wants to transfer assets into his name.
• LTO will flag a transaction where attorney transfers assets to himself and notifies PGT.
• Alter ego trust — for your benefit.
Desharnais v. Toronto Dominion Bank — F: Desharnais held a POA for her incapacitated spouse, Hawthorne. H named D the beneficiary under RRSP at TD Bank prior to incapacitation. A rep. advised D to switch it to TD Evergreen, a different company. Acting as attorney, D transferred RRSP from TD Bank to Evergreen bank and did not fill in space left for B designated, and so, her designation as B was lost. As a consequence, TD transferred the RRSP funds to the estate upon H’s death. H left a will but D was not named as a B. I & H: Are TD and Evergreen negligent? — TD liable for failing to advise Desharnais of the consequences of the transfer. Can an attorney make a B designation on behalf of an incapable grantor? Is the transfer of the RRSP under the POA valid? — No. Under section 49 of Law and Equity Act, as attorney, D had no power to make a beneficiary designation on behalf of her spouse. Only an annuitant can make a designation.
REPRESENTATION AGREEMENTSGENERAL• Legislation: Representation Agreement (“RA”); Health Care (Consent) and Care Facility (Admission)
Act (“HCC&CFAA). • Representation Agreement — permits health & personal decision-making authority to be appointed
• Standard (RA 7)• Non-standard — additional authority (RA 9)
• RA 7 — covers personal care, health care, and limited financial matters. • RA 9 — personal and health care only. • Scope of each is slightly different and while both RAs require capable adult, test for capacity is slightly
different. • RA 3 — Presumption of capacity — unless otherwise proven. • Current Use
• Consultation with physicians • Care facilities — 3.1 An adult must not be required to have a RA as a condition of receiving any
good or service• End of life decision-making
• Forms• My Voice — Provincial Guide Govt of BC• s. 13 RA must be in writing• Appropriate certificates (for Reps/Monitors) must be attached.
SECTION 7 — Standard provisions in RA
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• Capacity — no easy test but lower standard — RA 8(1) & (2)• Factors:
(a) whether adult communicates a desire to have a representative make, help make, or stop making decisions;
(b) whether adult demonstrates choices and preferences and can express feelings of approval or disapproval of others;
(c) whether adult is aware that making the representation agreement or changing or revoking any of the provisions means that the representative may make, or stop making, decisions or choices that affect the adult;
(d) whether adult has a relationship with the representative that is characterized by trust.• adult need not be capable of — (a) making K, (b) managing health, personal, or legal matters, (c)
routine financial management to make s.7 RA• Scope (RA 7(1) & (2) and RA 11)
1. personal care;2. routine management of the adult's financial affairs [Prof recommends taking this out],
including… (i) payment of bills, (ii) receipt & deposit of pension &other income, (iii) purchases of food, accommodation & other services necessary for personal care, and (iv) the making of investments;
3. major health care & minor health care, as defined in the HCC&CFAA, but not including the kinds of health care prescribed under section 34 (2) (f) of that Act;
4. legal services (except divorce proceedings)5. facility care
SECTION 9 — Enhanced Provisions• Capacity — simpler test — RA 10 — presumption of capacity to authorize representative unless
incapable of understanding the nature & consequences of proposed agreement. • Scope
• CAN: (a) any decisions re: personal care or health care of the adult, or(b) any of the following:
(i) where adult is to live and with whom, (including living in a care facility);(ii) whether adult should work and, if so, type of work, employer, & related matters;(iii) whether adult should participate in any educational, social, vocational or other activity;(iv) whether adult should have contact or associate with another person;(v) whether adult should apply for any licence, permit, approval or other authorization
required by law for performance of an activity;(vi) day-to-day decisions, including re: diet or dress of adult;(vii)give or refuse consent to health care for adult, including circumstances specified in
agreement, to specified kinds of health care, even though adult refuses to give consent at time health care provided;
(viii) despite any objection of adult, physically restrain, move and manage adult and authorize another person to do these things, if necessary to provide personal care or health care to adult.
• CANNOT: make arrangements for temporary care & education of adult’s minor children or dependents, or interfere w/ religious practices unless expressly stated in agreement.
Specific Authorization Required
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1. Health care under 34(2)(f) of HCCCFAA: abortion, tissue transplant, psychosurgery, experimental program, aversive stimuli treatment, electroshock therapy
2. Arrange temporary care/education of adult’s children 3. interfere with religious practises4. Help make a decision to refuse care necessary to preserve life5. Physically restrain, move or manage adult over his/her objections.
Decisions Not Permitted• S. 11(1) - Cannot instruct the representative to refuse consent to admission to a mental health facility
or receive professional services/treatment at mental health facility• S. 11(2) rep cannot consent sterilization for non-therapeutic purposes
EXECUTION• RA 12 — RAs must be in writing, signed by adult + 2 witnesses (or one lawyer/notary). All must sign in
each other’s presence.• Cannot be witnesses: attorneys and their spouses, children, parents, employees or agents nor minors• At least 1 representative must also sign RA — no witnesses required. • Substitute signatory permitted if incapable — under same provision as PA — in presence , at direction,
signatory is not named and not a witness.• RA 36 — Capable adult may continue to do anything RA is authorized to do
REPRESENTATIVES
Qualifications• 19 + adult or PGT• not: one who provides personal health care services for compensation — unless a spouse, parent, or
child. • Credit union or trust company can be RA — but only if RA does not include personal & health care. • Multiple representatives can be assigned different area — but if authorized to act in same area,
decisions must be unanimous.
Duties of Representatives• RA 16 (1) A representative must
(b) act honestly and in good faith,(c) exercise the care, diligence and skill of a reasonably prudent person, and(d) act within the authority given in the representation agreement.
• RA 16 (2) When helping the adult to make decisions or when making decisions on behalf of the adult, a representative must
(a) consult, to the extent reasonable, with the adult to determine his or her current wishes, and(b) comply with those wishes if it is reasonable to do so.
• RA 16 (2.1) Subsection (2) does not apply if(a) a representative is acting within authority given to the representative under section 9, and(b) the representation agreement provides that in exercising that authority the representative need
only comply with any instructions or wishes the adult expressed while capable.
Liability of Representatives
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• RA 23(1) A representative who complies with section 16 is not liable for injury to or death of the adult or for loss or damage arising from routine management of adult's financial affairs.
• RA 24(1) If a representative who acts w/in authority given in RA does not know, and could not reasonably have known, RA, or a provision of it, is not in effect or is invalid, Rep
(a) is deemed to have had authority to act, and(b) is not liable for acting without authority.
• (2) If RA or a provision of it is not in effect or is invalid, any exercise of the authority given to a Rep by RA is valid and binding in favour of a person who did not know and had no reason to believe that the agreement or provision was not in effect or was invalid.
MONITORS• Adult making a RA can appoint monitor to oversee decisions if desired — mandatory for s. 7 RAs that
include financial management, unless representative is spouse, PGT, credit union, or trust company, or if 2 or more reps required to act unanimously.
• Monitor must be at least 19 & willing and able to carry out duties and exercise power. • Powers — visit adult, access must not be blocked, required rep to produce accounts or report to
monitor. • Liability — RA 25 — monitor not liable for Rep’s default if monitor acted in good faith and with care,
diligence, and skill of a reasonably prudent person. • If monitor resigns, power of representatives is suspended until new monitor is appointed or court
determines monitor not requires. • Monitor Removal
• By adult if capable under standard of act. • PGT can appoint replacement monitor if requested by representatives or other interested party if
monitor is unsuitable or no longer able to act.• Court order on application by Rep or “other interested person” if they are dissatisfied with PGT
actions.• Monitor appointed by Court or PGT may be remunerated out of adult’s assets/rate set• RA 30 — Any person can make an objection regarding a rep which PGT must review
• Liability • RA 25 A monitor is not liable for any act or failure to act of a representative if the monitor
(a) acts honestly and in good faith, and(b) exercises the care, diligence and skill of a reasonably prudent person.
TERMINATION OF AGREEMENT• Financial provision terminates automatically on:
• Bankruptcy of adult (donor) or Rep or appointment of Receiver for adult• Conviction of Rep for offence involving dishonesty• If a CU or Trust Company, on dissolution, winding up or ceasing to carry on business• Committeeship order under Patients Property Act.
• Whole Agreement ends:• death of adult (donor)• court cancels it • rep is spouse and marriage/MLR ends
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• Rep incapable• resignation/death of all Reps• Revocation by Adult• Patients Property Act order.
*** PRACTICE POINTInvoluntary Separation Agreement – if we were ever to be involuntarily separated due to health issues. HVR under FLA there has to be an intention to separate.
Report to PGTIf a person believes that 1. RA was made, changed or revoked if donor believed incapable. 2. Fraud, undue pressure, abuse or neglect used so donor made, changed or revoked RA3. Making, use or revocation clearly inconsistent with current wishes, values, … of adult4. Rep is abusing/neglecting donor, incapable of acting, failing to comply, failing to follow instructions. No repercussions on person unless false or malicious accusation.
Solutions• Court may order change, revocation or cancellation taking into consideration the wishes, instructions,
values and beliefs of the adult who made Agreement and only override those wishes if adult is incapable and order is in best interests
• Costs at discretion of Court but may be paid from adult’s assets
Help?s. 34 - A Rep who is uncertain can ask PGT
ExtrajurisdictionalA document made outside of BC that meets that jurisdiction’s requirements can be certified by local practitioner (foreign jurisdiction) as valid and used in B.C. to perform the function of a representation agreement
CONFLICTS• Attorney v. Representative — Attorney wins.
• POAA 40 If any provision, respecting an adult's financial affairs, of a representation agreement made by an adult under the Representation Agreement Act is inconsistent with, or in conflict with, a provision of an enduring power of attorney made by the adult, the inconsistency or conflict is to be resolved in favour of the provision in the enduring power of attorney.
• Representation Agreement v. Advanced Directive — Unless RA states otherwise, RA wins
******RA 15 — ‘springing’ authority
ADVANCE DIRECTIVE FOR HEALTHCARE• Health Care (Consent) and Care Facility (Admission) Act (“HCC&CFA Act”)
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• Representatives can provide for consent/refusal of health care — doesn’t apply to certain sections of Mental Health Act or sterilization (non-therapeutic)
• Capacity — adult must understand nature & consequences of proposed advance directive AND scope & effect of health care instructions and the ADH will not apply under certain circumstances — HCC&CFA 19.1.
• Advance Directive does not apply:• where instructions don’t address health issue at hand;• directions so unclear as to make it uncertain if consent has been given or refused;• adult’s wishes have changed significantly since ADH made (but while adult was still capable)• significant changes in medical knowledge since ADH made.
PUBLIC GUARDIAN & TRUSTEELEGISLATION• Public Guardian and Trustee Act• WESA 153 — minor entitled to share of estate & no appointed trustee — share to be transferred to
PGT. • Insurance Act 88 — minor as designated B & no trustee — payment directed to PGT. • Community Care and Assisted Living Act 18 — PGT has to give consent before a testamentary gift to
an employee of the care facility in which the adult was resident is allowed.• HCC & CFA 16 — PGT as substitute decision-maker for incapable adult. • Patients Property Act — guardian for patients w/o mental capacity/ intestate estate.
GENERAL STATUTORY POWERS • PGTA 6 PGT may
(a) act as an executor under a will or as an administrator of an estate,(b) act, either alone or jointly with another person, as a trustee if the Public Guardian and Trustee
is appointed a trustee (i) in a will, settlement or other instrument creating the trust,(ii) by a majority of a trust's beneficiaries who have reached 19 years of age and are
otherwise capable of making the appointment,(iii) by a court,(iv) by a statute, or (v) by agreement of the Public Guardian and Trustee, and
(c) act as attorney of a person in accordance with the terms of a power of attorney or an enduring power of attorney.
• PGTA 6.1 (1) — Court can appoint PGT as litigation representative for estate of deceased party for whom no other legal personal representative exists. BN: PGTA 6.1 (2) — Court must not appoint PGT as LP of deceased's estate unless
(a) deceased left no executor, beneficiary, heir or other appropriate person who is willing and competent to act, and
(b) PGT provides prior written consent to act as LP.• PGTA 7 — PGT can act as property guardian and litigation guardian for a minor. • PGTA 18 — PGT can require guardians and institutions to produce records.
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ROLE OF PGT• acts for minors/adults w/o capacity/ estates of adults who don’t otherwise have a representative. • PGT can act in fiduciary role (direct representation) or in a protective/oversight role — both roes in
estate matters. • wills variation claims: PGT reviews adequacy of provision made for minors. • will not usually step in where no provision is made for a minor child, if the estate passes to the child’s
surviving parent (Cameron).• can act as the Litigation Guardian, or can seek a private LG to act for minor child — costs from estate. • If share of estate is gifted to a minor/ incapable adult, PGT will confirm there’s someone w/ legal
authority to manage. • Committeeship:
• PGT reviews committee applications under Patients Property Act.• PGT acts in role of committee for an adult.
Health Authorities are the first line of assistance:1. Informal solutions — restrictions on accounts, assisting w/ direct bill payments, etc. 2. If individual has sufficient capacity recommending they put in place POA/RA3. Referral to PGT if there are significant issues regarding assets/liabilities of individual.
INVESTIGATIVE POWERS UNDER PGT ss. 17-1917 (1) The Public Guardian and Trustee may investigate and audit the affairs, dealings and accounts of
(a) a trust, a beneficiary of which is or may be (i) a young person, (ii) an adult who has a guardian, or (iii) an adult who does not have a guardian but who is apparently abused or neglected, as defined in the Adult Guardianship Act,
(b) an adult who does not have a guardian, a representative or an attorney under an enduring power of attorney but who is apparently abused or neglected, as defined in the Adult Guardianship Act,
(c) an attorney under a power of attorney or an enduring power of attorney , if the Public Guardian and Trustee has reason to believe that the person who granted the power of attorney or enduring power of attorney is incapable of managing his or her financial affairs, business or assets,
(d) a representative , or(e) a guardian,
if the Public Guardian and Trustee has reason to believe that the interest in the trust, or the assets of the young person or adult, may be at risk, or that the representative, guardian or attorney has failed to comply with his or her duties.(2) In addition, the Public Guardian and Trustee may investigate the personal care and health care decisions made by a representative or guardian, if the Public Guardian and Trustee has reason to believe the representative or guardian has failed to comply with his or her duties.(3) Despite the Freedom of Information and Protection of Privacy Act, the Public Guardian and Trustee must not disclose or be compelled to disclose the identity of a person who makes a report resulting in an investigation or audit under this section.(4) Nothing in subsection (1) of this section requires the Public Guardian and Trustee to investigate and audit the affairs, dealings and accounts of a guardian who receives property on behalf of a young person under section 178 (2) (a) (ii) of the Family Law Act.
ESTATE ADMINISTRATION• deceased is: intestate, no relatives in BC willing to act, named executor unable or unwilling. other
qualified individuals refused. • will NOT act where: estate less than $5,000, insolvent estates, 3rd party intermeddler & assets can’t
be ascertained or recovered.
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COMMITTEES• Patients Property Act
GENERAL• PPA — “patient" means
(a) [certificate of incapability] a person who is described as one who is, because of mental infirmity arising from disease, age or otherwise, incapable of managing his or her affairs, in a certificate signed by the director of a Provincial mental health facility or psychiatric unit as defined in the Mental Health Act, or
(b) [court order] a person who is declared under this Act by a judge to be1. incapable of managing his or her affairs,2. incapable of managing himself or herself, or3. incapable of managing himself or herself or his or her affairs;
• PPA 3 —requirements for court order for committeeship — need supporting affidavits of 2 medical practitioners.
• PPA 12 — Application for discharge of committee — If a person ceases to be a patient, the person or the committee of the person's estate other than the PGT may apply, on 10 days' notice in writing to the PGT, to the court for the discharge of the committee.
• PPA 13 — Passing of accounts after application for discharge or rescission of committee. • PPA 14 (1) A person may be allowed reasonable compensation from the estate of a patient or from
the estate of a person who has ceased to be a patient for services rendered as committee of the patient or of the person who has ceased to be a patient.
• Community Care and Assisted Living Act 18 — PGT has to give consent before a testamentary gift to an employee of the care facility in which the adult was resident is allowed.
APPOINTMENT OF COMMITTEEGeneral• PPA 2 (1) — AG/relative/other person can apply for court order for declaration of incapacity,
declaring that a person is, because of (a) mental infirmity arising from disease, age or otherwise, or(b) disorder or disability of mind arising from the use of drugs.
incapable of managing his or her affairs or incapable of managing himself or herself, or incapable of managing himself or herself and his or her affairs. • PPA 9 A person can nominate his own committee if:
1. written application to court;2. testamentary capacity;3. adherence to formalities required for execution of wills; 4. no “good and sufficient reason” for court to refuse the nomination.
• Factors considered by court: • what is in the best interests of the patient — BC Public Trustee v. Pollen [1996] BCSC. • “protective approach … adult's autonomy, his personal dignity, his idiosyncrasies and the way he
has chosen to live his life while capacitated. It also takes into account most assuredly any wishes he has validly expressed while mentally competent or lucid about who he would like to act as his committee or otherwise make decisions on his behalf”: Re Vranic, 2007 BCSC
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• candidate’s previous involvement w/ patient and his family, his knowledge and understanding of patient’s situation and needs, his level of experience or capability in performing duties of committee, his plan for management of patient and any potential conflict of interest between patient and candidate: Re Bowman 2009 BCSC.
• a family member as committee is preferable to PGT: Kong v. Kong, 2010 BCCA.
Committeeship Application1. 2 medical opinions ($345. each)
• Typically only 1 doctor is usual physician but can arrange for 2nd opinion w/in clinic. • Opinions converted into Affidavits that stipulate:
• diagnosis of condition• comment on personal care• opinion that patient is by reason of mental infirmity incapable of manning both self and
affairs. • Normally applicant seeks both Committee of the Estate (financial) and Committee of the Person
(personal care decisions). 2. Affidavit of Kindred and Fortune (PPA Rules: Rule 2(3))
• describe personal information : age, marital status, address, and next of kin. • Consent required from nearest relatives if applicant not the nearest. • Statement of assets - valuation of real estate at fair market value, income from pensions, all other
sources, capital (bank accounts, savings, GICs, RIFs).• Information comes from banks — may or may not be willing to provide• Statement as to cost of expert care (normally facility based)
3. Service of Application on “Patient” • unless it would cause harm.• doctors will give opinion on it in their respective affidavits.
4. Service on person w/ existing POA/other interested • even if not sure if there is a valid POA• relatives where consent refused.
5. Review of application by PGT ($530.)• Documents sent to PGT office include a draft Order. • Expect PGT to give attorney no control over capital — only income. • Expect to have controls placed regarding land (PGT reviews any conveyance). • PGT often suggests a Bond be placed on Committee. • (PGT might contest application — trial — most costs).
6. Court Application• Commenced by petition ($200 filing fee) Notice of Hearing setting the date. • Requires Application Record (Binder of all documents including draft order and Response from
PGT filed)• normally scheduled for less than 30 minutes. • Note: Several of the forms are in the PPA Rules.
Hearing• Make submissions to
(ii) describe the Patient and
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(iii) confirm you have met the requirement to have the Order issued (i.e. 2 medical opinions)• Cost of Application: S.A. fee — about $5k all in ($1600 in out of pocket costs) — paid out of accounts
of Patient.
*** PRACTICE POINTRetainer letter — that the applicant is responsible for costs. Your firm is not going to be impressed if you fail to collect your fees from the attorney/donor.
Post Order• Important to advise client (Committee) if requirements to keep careful records of (1) decisions and (2)
financials. • PGT will assign a case worker who will require financial records submitted initially annually and
depending on the records bi-annually after that, PGT again charges a fee to review the accounts ($125+).
POWERS OF COMMITTEE• (Note: Powers of a committee are dependent on type of declaration of incapacity.) • PPA 15 (1) Subject to section 16,
(a) the committee … has all the rights, privileges and powers with regard to the estate of the patient as the patient would have if of full age and of sound and disposing mind, and
(b) the committee of a patient2. declared to be incapable of managing his or her affairs has all the rights, privileges and
powers with regard to the estate of the patient as the patient would have if of full age and of sound and disposing mind,
3. declared to be incapable of managing himself or herself has the custody of the person of the patient, and
4. declared to be incapable of managing himself or herself or his or her affairs has all the rights, privileges and powers with regard to the estate of the patient as the patient would have if of full age and of sound and disposing mind, and as well the custody of the person of the patient.
• PPA 15(2) For investing money, a committee is a trustee w/in the meaning of the Trustee Act.• Limitations/Conditions:
• PPA 16 — Court can attach restrictions/conditions in court order granting committeeship. • PPA 18 A committee must exercise the committee's powers for the benefit of the patient and the
patient's family, having regard to the nature and value of the property of the patient and the circumstances and needs of the patient and the patient's family.
COMPENSATION & FEES OF COMMITTEE
PPA 14 (1) A person may be allowed reasonable compensation from the estate of a patient or from the estate of a person who has ceased to be a patient for services rendered as committee of the patient or of the person who has ceased to be a patient.(2) The compensation, if any, to be paid to a person other than the Public Guardian and Trustee must be fixed on the passing of accounts.(3) If, in the opinion of a person who is entitled to compensation under this section, the estate of a patient or the estate of a person who has ceased to be a patient is so limited in value that the payment out of it of compensation would create poverty or hardship for the patient or person who has ceased to be a patient or the patient's dependants, no compensation need be claimed or paid or no amount need be retained out of the estate.
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(4) A committee of a patient or a person who has been the committee of a person who has ceased to be a patient has a first lien or charge on the estate of the patient or person who has ceased to be a patient for all costs, expenses and advances made by him or her for or incidental to the administration of the estate of the patient or the person who has ceased to be a patient or for the benefit of the patient or person who has ceased to be a patient, the patient's family or other dependants.
• Compensation for acting as committee — PPA 14. • Fees to act as committee
• Committee is entitled to annual remuneration (taxable) from funds of patient:• 5% of income (Pensions) plus 0.4 of 1% of gross value of assets for asset management upon review
by PGT and only paid upon approval of accounts by PGT. • E.g. Math
• Pensions $33,600 per annum• RIF $150,000• Home proceeds held in GIC $250,000• 1% (33,600) = 336.00• .4x1% x 400,000 = 1600• Annual therefore 1936.00 (taxable)
• PGT Fees2. 1% of value of case received as capital, plus (— on receipt by PGT)3. 5% of cash received as income, plus (— on receipts by PGT)4. 0.4 of 1% per annum, computed monthly, on gross value of all assets, plus (— monthly) 5. 1% of gross value of all assets (— on termination of support & assistance order.)
*** PRACTICE POINT• Retainers/Letters of Retainer: At the least you need to have a signed letter of retainer from the person
moving the application forward — costs recovered regardless of success of application
EFFECT OF COMMITTEE ON POA AND REPRESENTATION AGREEMENTSCourt Ordered Committee• PPA 19 On a person becoming a patient as defined in paragraph (b) of the definition of "patient" in
section 1,(a) every power of attorney given by the person is terminated, and(b) unless the court orders otherwise , every representation agreement made by the person is
terminated.• Criteria considered by court under PPA 19 (Lindberg v. Lindberg, 2011 BCCA):
(a) the circumstances in which the representation agreement was executed;(b) the scope of the representation agreement; and(c) the basis for the application to set it aside.
• If effective representation agreement, application for appointment of a committee is unnecessary upon court order (Lindberg v. Lindberg; Allan v. Patterson)
Certificate of Incapability • PPA 19.1 (1) On a person becoming a patient as defined in paragraph (a) of the definition of "patient"
in section 1 [means other than court order], the following are suspended:(a) every power of attorney that was given by the person;
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(b) every provision of a representation agreement made by the person in respect of his or her property.
• PPA 19.1 (2) After receiving a copy of the suspended POA or of a RA any provision of which has been suspended under subsection (1) and any information that the PGT may require, the PGT must determine whether it is necessary or desirable for the PGT to manage the patient's property under this Act.
• PPA 19.1 (3) If the PGT determines that it is necessary or desirable for the PGT to manage the patient's property, then on the making of the determination
(a) the power of attorney that was suspended under subsection (1) is terminated, or(b) the provisions of the representation agreement that were suspended under subsection (1) are
cancelled,as the case may be.• PPA 19.1 (4) If the PGT determines that it is not necessary or desirable for the PGT to manage the
patient's property,(a) the PGT's authority as committee under the certificate referred to in paragraph (a) of the
definition of "patient" in section 1 is terminated on the making of that determination, and(b) the suspension of the power of attorney or of the provisions of the representation agreement
ends on the termination of the PGT's authority as committee.
***PRACTICE POINT• If committeeship is granted, POA is terminated right away, and the Representation Agreement is
based on what court decides. • POA is terminated b/c you cannot have two people deciding. • Even Advanced Directive can be trumped by court order. • Court order trumps all — if court says committee stands — committee has say over everything.
EFFECT OF DEATH OF PATIENT• PPA 24 (1) Subject to subsection (2), on the death of a patient and until letters probate of the will or
letters of administration of the estate of the patient are granted and notice in writing of the grant is served on the committee, the committee of the patient
(a) continues to have the rights, powers, duties and privileges that the committee would have had if the patient had not died, and
(b) has the powers of an executor of the last will and testament of or the administrator of the estate of the patient.
** Committee’s authority does not automatically end upon the death of the patient.
SOLICITOR’S RESPONSIBILITIES
BC Code of Professional Conduct• Clients with diminished capacity — 3.2-9: When a client’s ability to make decisions is impaired b/c of
minority or mental disability, or for some other reason, the lawyer must, as far as reasonably possible, maintain a normal lawyer-client relationship.
• Confidential Information — 3.3-1: A lawyer at all times must hold in strict confidence all information concerning the business and affairs of a client acquired in the course of the professional relationship and must not divulge any such information unless:
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(a) expressly or impliedly authorized by the client;(b) required by law or a court to do so;(c) required to deliver the information to the Law Society, or(d) otherwise permitted by this rule.
• Lawyer’s obligation to claim Privilege: 3.3-2.1 A lawyer who is required, under federal or provincial legislation, to produce a document or provide information that is or may be privileged must, unless the client waives the privilege, claim solicitor-client privilege in respect of the document.
• Future harm/public-safety exception — 3.3-3 A lawyer may disclose confidential information, but must not disclose more information than is required, when the lawyer believes on reasonable grounds that there is an imminent risk of death or serious bodily harm, and disclosure is necessary to prevent the death or harm.
• Commentary:• [1] Confidentiality and loyalty are fundamental to the relationship between a lawyer and a client
because legal advice cannot be given and justice cannot be done unless clients have a large measure of freedom to discuss their affairs with their lawyers. However, in some very exceptional situations identified in this rule, disclosure without the client’s permission might be warranted because the lawyer is satisfied that truly serious harm of the types identified is imminent and cannot otherwise be prevented. These situations will be extremely rare.
• [2]The Supreme Court of Canada has considered the meaning of the words “serious bodily harm” in certain contexts, which may inform a lawyer in assessing whether disclosure of confidential information is warranted. In Smith v. Jones, [1999] 1 SCR 455 at paragraph 83, the Court also observed that serious psychological harm may constitute serious bodily harm if it substantially interferes with the health or well-being of the individual.
• Conclusion: The obligation not to disclose to family members, PGT office, or other persons in the event of suspected abuse is required. The only “assistance” can be refusal to participate.
***PRACTICE NOTE• Advice will vary as to the party making inquiries: family members; friends; person w/ authority
(existing POA)• Advice will vary depending on how advanced or incapable the individual is.
What the POA doesn't provide• You cannot take away the individual’s right to still make his/own financial and legal decisions• Capacity issues where there is self-harm?
• Donor sending money into the mail• Donor who is being preyed upon.
• For the client1. Presumption of Capacity2. Examination by you of his/her capacity — remember the provisions o pOAA3. Can he/she reasonably demonstrate capacity to sign POA and/or Representation Agreement?
Estate planning: understand the potential role the office may play or become involved w/ your client’s plan.
Simons v. Simons 2013 BCSC –
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F: Jeffrey Simons applied for committeeship for his father, Montague’s estate and person. Montague’s long-term girlfriend and new wife, Linda Di Clemente opposed the application. Jeffrey holds a POA for his father and is a joint trustee for his father’s alter ego trust. These powers were given before his hip replacement surgery in 2010 after which his mental state started to deteriorate. Linda is a rep. under Montague’s Representation Agreement granted in November, 2012 after the decline in his mental capacity. There were at least two medical practitioners who affirmed that Montague was no longer capable. Linda wants a court order that states the Representation Agreement should survive any appointment of committee. There have been various allegations of physical abuse of Montague by his wife Linda. Linda and Weinstein accused Jeffrey of misuse of Montague’s finances. The PGT supports Jeffrey’s application. I & H: 1) Who are the appropriate parties to the petition proceedings and what is the appropriate mode of hearing? 2) Does the Patient require a committee? 3) If so, who is the best qualified candidate? and 4) Should the Representation Agreement survive any appointment of committee? — Court held that Montague was incapable of managing his person or his affairs and appointed Jeffrey as committee over his person and estate. Ms. Di Clemente’s application to continue as Rep under the RA was terminated because of mental capacity concerns. **RA if you get a full enhanced, may in some ways come into conflict with POA.
Lindberg v. Lindberg 2010 BCSC - establishes criteria considered under PPA s. 19. F: Dorothy Lindberg appointed Ms. Shoemaker as her PR under her POA and Representation Agreement — both executed when she was mentally capable. After receiving a call from the police and talking with health care professionals, Ms. Shoemaker moved Dorothy to a care facility. She moved to sell her house to pay for Dorothy’s living expenses. Upon learning of the proposed sale of house, Dorothy’s son, Edward Lindberg applied for court order for committee over his mother, Dorothy’s person and estate and instated an injunction on the sale of the house. Ms. Shoemaker opposed this application and asserts that her appointment as representative makes it unnecessary for the appointment of committee. I & H: Edward’s petition dismissed and interim injunction set aside. Court held that Dorothy’s appointment of Ms. Shoemaker continues despite her later onset of dementia. Therefore, appointment of committee is unnecessary.
**If committeeship is granted, POA is terminated right away, and the Representation Agreement is based on what court decides. POA is terminated b/c you cannot have two people deciding.
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