Intention to Gift: The Legal Requirements

Intention to Gift: The Legal Requirements

A gift requires three elements  to be legally effected, namely an intention to donate, an acceptance of the gift, and delivery of the gift. All three elements must be present for the gift to be complete, and it is then irrevocable.

The gift is the voluntary transfer of property from one person to another without full consideration.
It is well settled law, as confirmed by the Supreme Court of Canada in the Pecore v Pecore  2007 SCC 17 that the courts look to the intention of the donor at the time of the transfer in order to determine if a gift was actually intended.
Anyone who intends to make a gift of property for little or no consideration must ensure that the intention of the donor is well documented. A Deed of gift given under seal, along with the statutory declaration of the intention to gift is probably the best evidence that the courts will rely upon.
The problem however is that a minority of purported gifts are not substantiated at all as to the intention of the donor, which then forces, the court to assess the reliability of the evidence, if any of intention to gift.
Probably the most common form of contentious gifts are the use of joint tenancy in both real property and investments. By reason of the nature of the joint tenancy, upon the death of a joint tenant, the surviving joint tenant automatically becomes the registered owner of the property by right of survivorship. This happens immediately upon death, and does not form part of the estate of the deceased or attract probate fees.
Common reasons for putting property in joint tenancy is to avoid probate fees or avoid a claim under the wills variation statutes, which are inconsistent with an intention to gift and will typically result in a claim of resulting trust being made against the surviving joint tenant.
Accordingly, a mere transfer of the legal title into joint tenancy is not conclusive as to the transfers intention as the beneficial interest may belong to the estate of the deceased and not the surviving joint tenant unless there was a clear indication of the transfers intention to gift.
While the courts will primarily look at the time of the transfer as to  the intention of the deceased as to whether a gift was intended, the courts may also consider the donors subsequent actions to the extent that those actions are relevant to the donors intention of the time of transfer.

Accordingly, a transfer of title into joint tenancy has three potential legal consequences:

A) an immediate gift of both legal and beneficial title;
B) a transfer of the legal title only, so that the transferee holds the property on a resulting trust for the transferor’s estate;
C) as recognized in the Pecore decision, a transfer of the legal title with a right of survivorship in the asset, but a transfer of beneficial title only upon the death of the transferor.

McKendry v McKendry  2015 BCSC 2433 followed the Pecore case and stated inter alia:

[109]   The legal principles applicable when considering a gratuitous transfer into joint tenancy are not in dispute. The basic question is whether the transferor intended to make a gift, or whether the transferee holds the property transferred on a resulting trust.

[110]   Pecore v. Pecore, 2007 SCC 17, is the leading case.

[111]   It is the actual intention of the transferor at the time of the transfer that is relevant: Pecore, at paras. 5,44 and 59. The presumption of resulting trust is a rebuttable presumption of law and general rule that applies to gratuitous transfers.

When a transfer is challenged, the presumption allocates the legal burden of proof.

Thus, where a transfer is made for no consideration, the onus is placed on the transferee to demonstrate that a gift was intended. See Pecore, at paras. 24 and 43.

Rothstein J. also noted (Pecore, at para.44):

[44]   As in other civil cases, regardless of the legal burden,

both sides to the dispute will normally bring evidence to support their position. The trial judge will commence his or her inquiry with the applicable presumption and will weigh all of the evidence in an attempt to ascertain, on a balance of probabilities, the transferor’s actual intention. Thus, as discussed by Sopinka et al, in The Law of Evidence in Canada, at p. 116, the presumption will only determine the result where there is insufficient evidence to rebut it on a balance of probabilities.

[112]   Accordingly, where a gratuitous transfer is being challenged, the trial judge must begin the inquiry by determining the proper presumption to apply and then weigh all the evidence relating to the actual intention of the transferor to determine whether the presumption has been rebutted: Pecore, at para. 55. In general, evidence of the transferor’s intention at the time of the transfer ought to be contemporaneous, or nearly so to the transaction: Pecore, at para. 56.

Nevertheless, evidence of intention that arises subsequent to a transfer should not automatically be excluded. However, such evidence “must be relevant to the intention of the transferor at the time of the transfer

Notice to Dispute: Understanding the Rules

Notice to Dispute: Understanding the Rules

A party wishing to contest the issuance of a grant of probate or administration may file a Notice to Dispute under Rule 25 (10) of the Supreme Court Rules.

While a notice to dispute is in effect, the registrar must not issue an estate grant. The court may, on application, remove the notice of dispute if the court determines that the filing is not in the best interests of the estate. A notice of dispute is in effect for one year after the date of filing unless renewed or removed by order of the court or the will is proved in solemn form. 

Re: Dow Estate 2015 BCSC 292 stated:

[14]         A person who is interested in an estate including an applicant for the estate grant could apply to set aside the notice of dispute pursuant to Rule 25-10(10). The court may remove the notice of dispute if the court determines that the filing is not in the best interests of the estate (Rule 25-10(11)).

Rule 25-10 — Notices to Dispute

(1)To oppose the issuance of an estate grant, an authorization to obtain estate information or an authorization to obtain resealing information or to oppose the resealing of a foreign grant, a person to whom documents have been or are to be delivered under Rule 25-2 (2) must file a notice of dispute that accords with subrule (3) of this rule before the earlier of:

(a) the issuance of an authorization to obtain estate information or an authorization to obtain resealing information, and

(b) the issuance of an estate grant or the resealing of a foreign grant.

[en. B.C. Reg. 149/2013, s. 8.]

Only one notice of dispute to be filed

(2)A person must not file more than one notice of dispute in relation to any one estate.

[en. B.C. Reg. 149/2013, s. 8.]

Contents of notice to dispute

(3)A notice of dispute referred to in subrule (1) must be in Form P29, must provide an address for service of the disputant, which address for service must be an accessible address that complies with Rule 4-1 (1), and must disclose

(a) that the disputant is a person to whom documents have been or are to be delivered under Rule 25-2 (2), and

(b) the grounds on which the notice of dispute is filed.

[en. B.C. Reg. 149/2013, s. 8.]

Amendment of notice to dispute

(4)A notice of dispute may be amended once without leave of the court, and after that only with leave of the court.

[en. B.C. Reg. 149/2013, s. 8.]

(5)Rule 6-1 (2) and (3) applies to an amendment of a notice of dispute without leave of the court and, for that purpose, a reference in that rule to a pleading is deemed to be a reference to the notice of dispute.

[en. B.C. Reg. 149/2013, s. 8; am. B.C. Reg. 44/2014, Sch. 1, s. 8 (a).]

Renewal of notice of dispute

(6)The court may renew a notice of dispute, for any period the court considers appropriate, as follows:

(a) if the application for renewal is brought before the notice of dispute ceases to be in effect, if the court is satisfied that it is appropriate to make an order for renewal;

(b) if the application for renewal is brought after the notice of dispute ceases to be in effect, if the court is satisfied that

(i) there were good reasons that the application for renewal could not be brought before the notice of dispute ceases to be in effect,

(ii) substantial prejudice would be suffered by the person seeking renewal of the notice of dispute if the order for renewal is not made, and

(iii) no other person interested in the estate would suffer substantial prejudice if the order for renewal is made.

[en. B.C. Reg. 149/2013, s. 8.]

Application for renewal of notice of dispute

(7)Subject to Rule 8-5 (6), an application to renew a notice of dispute filed in relation to an estate must be made on notice to

(a) each person who has submitted for filing a submission for estate grant, or a submission for resealing, in relation to the estate,

(b) each person who has filed a notice of dispute in relation to the estate, and

(c) any other interested person to whom the court directs notice be given.

[en. B.C. Reg. 149/2013, s. 8.]

No grant while notice to dispute in effect

(8)While a notice of dispute is in effect in relation to the estate of a deceased, the registrar must not, with respect to that estate,

(a) issue an estate grant, an authorization to obtain estate information or an authorization to obtain resealing information, or

(b) reseal a foreign grant.

[en. B.C. Reg. 149/2013, s. 8.]

Withdrawal of notice of dispute

(9)A disputant may withdraw a notice of dispute by filing a withdrawal of notice of dispute in Form P30.

[en. B.C. Reg. 149/2013, s. 8.]

Application to remove notice of dispute

(10)A person who is interested in an estate in relation to which a notice of dispute has been filed, including, without limitation, an applicant for an estate grant or for the resealing of a foreign grant, may apply on notice to the disputant for an order removing the notice of dispute.

[en. B.C. Reg. 149/2013, s. 8.]

Grounds on which notice to dispute may be removed

(11)On an application under subrule (10), the court may, by order in Form P31, remove a notice of dispute if the court determines that the filing is not in the best interests of the estate.

[en. B.C. Reg. 149/2013, s. 8.]

When notice of dispute ceases to be in effect

(12)A notice of dispute in relation to an estate ceases to be in effect as follows:

(a) subject to paragraph (b), on the date that is one year after the date on which the notice of dispute was filed;

(b) if the notice of dispute has been renewed under subrule (6), at the end of the renewal period;

(c) if the notice of dispute is withdrawn by the disputant under subrule (9);

(d) if the will in relation to which the notice of dispute relates is proved in solemn form;

(e) if the court orders, under subrule (11) or otherwise, that the notice to dispute is removed.

Removal of Executor/Trustee For Conflict of Interest

Removal of Executor/Trustee For Conflict of Interest

As a BC estate lawyer, I am often asked to remove an executor/trustee. Re Ching 2016 BCSC 1111 is one of several cases where the courts have indicated their reluctance to remove an executor for a perceived conflict of interest. The executor/trustee was however removed and replaced as the conflict of interest was “disabling” to her performance as trustee as opposed to the interests of others.

[22]        The authorities indicate that even a “perceived” conflict of interest between an executor’s personal interests and her obligation to administer the trusts in the will in the interests of the beneficiaries may cause this court to intervene to appoint a new executor or an administrator to avoid even the appearance of conflict. In para. 53 of her response to civil claim filed in the asset recovery action Gini alleges that:

[24]        The executor makes several arguments to support her continuation in that role. She submits, firstly, that the estate is complex and that she has “the most knowledge” of its assets among the three sisters. In my view, this consideration cannot outweigh the conflict between her obligation as executor to call in the assets of the estate and her own interest in asserting that significant assets, that are alleged in the asset recovery action to belong to the estate, actually belong to her.

[25]        Secondly, she submits the testator’s choice of executor ought to be respected. I accept that is a compelling factor and this court has often expressed its reluctance to remove an executor when a conflict of interest is alleged.

[26]        In Parker v. Thompson (Trustee), 2014 BCSC 1916, Hinkson C.J.S.C. at para. 37 wrote the following:

[37]         I accept the principles pertaining to the removal of an estate trustee set out by Madam Justice Nolan in Haines v. Haines, 2012 ONSC 1816 at para. 10 as equally applicable to the removal of the trustee:

In Johnson v. Lanka, 2010 ONSC 4124, (2010), 103 O.R. (3d) 258 at para. 15, Pattillo J. summarized the principles that should guide the court’s discretion in deciding whether to remove estate trustees:

(1) the court will not lightly interfere with the testator’s choice of estate trustee;

(2) clear evidence of necessity is required;

(3) the court’s main consideration is the welfare of the beneficiaries; and

(4) the estate trustee’s acts or omissions must be of such a nature as to endanger the administration of the trust.

[27]         The outcome of each application for the removal of an estate trustee will depend on its own facts. The evidence satisfies me that the administration of the estate is endangered if the executor continues to be faced with the conflict of interest inherent in that role.

[28]        Thirdly, the executor submits she has not been guilty of any misconduct in her duties as executor. I make no finding on evidence before me that there has been misconduct but, in my view, even without misconduct the conflict is egregious.

[29]        The executor, lastly, submits that she had little opportunity to administer the trusts before she was prevented from doing so by the notice of dispute. The evidence is that the executor had taken a number of steps to administer the trusts and again those steps illustrate the conflict which has arisen.

[30]        I conclude that Gini, so long as the asset recovery action continues, cannot perform her role as executor without inevitably suffering from a disabling conflict between her own personal interests, as she sees them, and the interests of others.  

[31]        There will be an order that Solus Trust Company Ltd. be appointed administrator of the estate of the testator pending the outcome of the asset recovery action; an order vesting the assets of the testator in Solus Trust for that purpose; an order that Solus Trust is entitled to be paid its fees and disbursements for its administration services in accordance with Schedule A attached to these reasons; and, an order that Pamela and Gini are each entitled to be paid their respective costs of the present application on a full indemnity basis from the estate.

Ensuring Independent Legal Advice

Ensuring Independent Legal Advice

Many transactions are set aside in British Columbia by the courts on the basis that true independent legal advice was not obtained by the person making a radically changed will or transferring an asset for little or no consideration.

A lawyer’s duty in such situations is to be the vanguard of providing true Independent legal advice (ILA) so as to protect  a victim of  undue influence or lack of mental capacity being taken advantage of by an unsavory character.

Thus it is critically important for the lawyer to ensure that he or she is in a position to provide truly independent legal advice to the client.

At any given time I have a case where that has not been the case.

For example a lawyer takes instructions form a daughter of the deceased that her mother wishes to transfer her property into joint tenancy with the daughter.

The lawyer meets with them both at the same time, confirms the instructions with the mother in the presence of the daughter, and transfers the property into joint tenancy for m$1 consideration, and renders the account to the daughter.

The client in that case is the daughter, not the mother. The mother has in effect given away all of her assets to the daughter without the benefit of any legal advice, let alone independent legal advice.

The mother in that scenario might well have balked at doing such had she received true independent legal advice. The lawyer acting for both the daughter and the mother is in a conflict of interest.

7 Reasons a Lawyer Cannot Provide Independent Legal Advice

Accordingly, a lawyer is not in a apposition to provide true independent legal advice if any one of the following is present (not an exhaustive list):

  1. The legal fees are being paid by the person taking advantage under the relationship rather than the person causing the transfer or changing will to be made;
  2. The lawyer does not have a full understanding of the clients total assets, income and expenses and is unable to assess a discuss with the client the extent to which it may leave them vulnerable or impoverished.Detailed notes of the financial situation of the possible victim should be entered contemporaneously.;
  3. The lawyer has a prior professional relationship with the person taking advantage;
  4. Some or all of the instructions have come from the party taking advantage;
  5. The lawyer has a past relationship such as personal, friendship, or the like with the party taking advantage;
  6. The lawyer is acting in a purported joint retainer with the person taking advantage;
  7. The party taking advantage is present at the time the advice or instructions are given or when the documents are signed

If any of the after said situations are present, then it is incumbent on the lawyer to refer the client out to another lawyer for true independent legal advice without any involvement of the party taking advantage.

There is a failure on the part of the lawyer to ask probing questions as to the reason for the will change or transfer of property for no consideration and to ensure that the client attains a true and complete understanding of all its implications.

In my experience as a BC Lawyer,  after a full and complete understanding is brought to bear, clients will often balk at entering into the change of will or property transaction. It is common that elderly persons are often pushed into a transaction based on poor explanation or untruths about other interested parties.

Lower Courts Bound By Higher Courts (Stare Decisis)

Lower Courts Bound By Higher Courts (Stare Decisis)

Most people likely know that higher courts such as appeal courts bind the decisions of lower courts through precedents. The legal term is stare decisis (to adhere to precedents), and the legal rationale is that like decisions should be decided alike so as to give more certainty to the outcome of the case, based on established legal principles.

The decision of Black v Owen 2017 ONCA 397 of the Ontario Court of Appeal discusses this hallmark of our common law legal system:

42      As the Supreme Court emphasized in Canada (Attorney General) v. Bedford, 2013 SCC 72, [2013] 3 S.C.R. 1101, at para. 38: “Certainty in the law requires that courts follow and apply authoritative precedents. Indeed, this is the foundational principle upon which the common law relies.” Failure to adhere to this core principle is inconsistent with the principle of stare decisis, the need for certainty and stability in the administration of justice, and the orderly development of the law.

43      Consistent with this principle, the Supreme Court has held that a trial judge’s authority to depart from binding precedent is limited. Bedford instructs, at para. 42:

[A] trial judge can consider and decide arguments based on Charter provisions that were not raised in the earlier case; this constitutes a new legal issue. Similarly, the matter may be revisited if new legal issues are raised as a consequence of significant developments in the law, or if there is a change in the circumstances or evidence that fundamentally shifts the parameters of the debate.

See also Carter v. Canada (Attorney General), 2015 SCC 5, [2015] 1 S.C.R. 331, at para. 44. Further, the Supreme Court has rejected the notion of the anticipatory overruling by a lower court of a binding authority by a higher court: Canada v. Craig, 2012 SCC 43, [2012] S.C.R. 489.

44      In this case, the respondents do not contend that either of the Bedford conditions, set out above, were satisfied so as to justify departure from the majority opinion in Amberwood.

45      The Bedford conditions are not met here. First, unlike Bedford and Carter, this is not a case involving s. 7 of the Charter of Rights and Freedoms. Second, no new legal issue concerning the positive covenants rule or the possible exceptions to that rule, that were not addressed in Amberwood, was raised in this case. Third, no significant post-Amberwood developments in the law of Ontario had occurred. I note, in particular, that the extent to which the decision of the English Court of Appeal in Wilkinson warrants importation of the benefit and burden exception into Ontario law, if at all, was a matter for determination by this court. Neither Wilkinson in England nor Wentworth Condominium Corporation in Ontario permits a lower court judge to prefer the minority, over the majority, opinion of this court in Amberwood.

46      To summarize, in a case like this one, a judge of a lower court may not decline to follow a binding precedent of a higher court on the ground that he or she disagrees with it or because, in his or her view, it appears to have been overtaken by subsequent decisions of a lower court in the same jurisdiction, or by jurisprudential developments in another jurisdiction. In this case, what the Appeal Judge should have done was follow and apply the majority decision in Amberwood and provide reasons why she viewed it as problematic, rather than decline to follow it: see, for example, in the constitutional context, Craig, at para. 21.

Dysfunctional Families: The Predator Spouse

Dysfunctional Families - Disinherited

A disturbing and increasing trend in dysfunctional families is the advent of the predator spouse who takes advantage of elderly victims and assumes control of usually financial affairs and marries the victim in short order.

Even if the family had been reasonably functional prior to this event, the interference of the predator spouse upon an elderly loved one can wreak severe consequences for both the victim and his or her family.

Every estate litigator has likely had experience with the predator spouse.

Typically they are much younger women, often a caregiver, who single out an elderly and vulnerable man who is typically recently widowed , and does so for the purpose of personal profit and exploitation.

Family members are usually cut off, excluded from the life of their loved one and not informed of the marriage ceremony.

The goal of the predator spouse is to enter into a legal form of marriage, while making the victim increasingly excluded from family members and totally dependent upon the predator. The overwhelming control exerted by the predator spouse is often backed up with the terrifying threat of putting the elderly spouse in a care facility .

In my experience the elderly widower is often cognitively impaired, significantly depressed and unable to care for himself. The predator spouse is often skilled at befriending such victims and often has a history of prior marriages for the same exploitive purpose.

The children are often beside themselves as they see both their family connection totally disrupted, as well as their possible inheritance going to an intervening stranger.

The relationship usually begins as either a hired caregiver or as someone who quickly befriends the elderly person and gains his trust through companionship and assistance. Many such men find the younger female predator to be sexually irresistible and cannot avoid the “temptation”.

The marriage ceremony often occurs in secret within several weeks of the start of the insidious relationship.

One of the major difficulties with such marriage ceremonies is that they are often very difficult in law to set aside, primarily on the basis of lack of mental capacity.

The courts generally speaking have had difficulty in defining exactly the test for capacity to marry, but seem to have adopted a standard that it is to be treated as quite low on the basis that marriage is a “simple contract.“ The judicial reasoning in my opinion could not be more incorrect given the complexity of current matrimonial laws, particularly as they relate to the division of property and assets, and the consequent  difficulty of divorce in present day.

Such judicial reasoning continues however that marriage is a “simple contract” requiring very little cognitive reasoning to understand the consequences of same.

Cases of the Predator Spouse

There has been at least one judicial decision where the court recognized the effect that a marriage has on one’s property and children and a higher standard of capacity to marry was applied.

That decision was in Alberta case of Barrett Estate v. Dexter 2000 ABQB 530. In that decision, the deceased had been tested for mental capacity prior to his death, and was found to have significantly impaired cognitive function and judgment. A geriatric physician opined that a person must understand the nature of the marriage contract, the state of previous marriages, one’s children and how they might be affected.

Probably my most egregious case was a widower who began to frequent the services of a prostitute who “specialized in seniors”. Within a short while the prostitute moved in with the elderly man, changed the locks and telephone number and cut him off from his three children. They married shortly thereafter, she arranged for him to change his will to provide for her exclusively, and  within three months of their marriage, she physically beat him to death, and was convicted of his murder.

Another successful challenge to a predator marriage was in Juzumas v Baron 2012 ONSC 7220 where the marriage was set aside on the basis that the contract of marriage was unconscionable due to the inequality of bargaining power, and undue influence.

The court stated as follows:

8     In his text, The Law of Contracts, John McCamus addresses the “cluster of doctrines” that apply “where a stronger party takes advantage of a weaker party in the course of inducing the weaker party’s consent to an agreement.” John D. McCamus, The Law of Contracts, 2nd ed. (Toronto: Irwin Law, 2012), at p. 378. The cluster of doctrines includes undue influence and unconscionability. If any one of these doctrines applies, the weaker party has the option of rescinding the agreement.

9      McCamus describes the equitable doctrine of undue influence as providing a “basis for setting aside a gift or a transaction where the transfer of value has been induced by an ‘unconscientious use by one person of power possessed by him [or her] over another.'” McCamus, at p. 402; see also Morrison v. Coast Finance Ltd. (1965), 55 D.L.R. (2d) 710 (B.C. C.A.), at p. 713; and Knupp v. Bell (1968), 67 D.L.R. (2d) 256 (Sask. C.A.), at p. 259. He addresses the distinction between the two categories of undue influence: actual and presumptive undue influence. As an example of actual undue influence, McCamus refers to Craig v. Middleton, [1970] 2 All E.R. 390 (Eng. Ch. Div.), in which a caregiver threatened an elderly dependent with abandonment: McCamus, at p. 403-404. The onus is on a plaintiff to establish actual undue influence.

10      A presumption of undue influence arises from the nature of a recognized relationship (e.g., solicitor and client, doctor and patient etc.). The presumption can also arise from the particular circumstances of the case, where one party has the ability or potential to “dominate the will of another, whether through manipulation, coercion, or outright but subtle abuse of power.” Goodman Estate v. Geffen, [1991] 2 S.C.R. 353 (S.C.C.), at p. 377.

11      Such a presumption is rebuttable by evidence that the transaction was an exercise of independent free will: Geffen, at p. 379; and Bank of Montreal v. Duguid (2000), 47 O.R. (3d) 737 (Ont. C.A.), at para. 24-25. Evidence of free will may be demonstrated by evidence of independent legal advice, or at least an opportunity for the individual

The Principles of Moot Court Cases

The Principles of Moot Court Cases

Moot court cases occur when a determination is sought on a matter which when decided by the court will not have any practical effect on the existing dispute such as the legal issue no longer exists.

The courts do however have discretion when the moot case is important enough to hear the case such as occurred in DaGG V Cameron Estate 2017 ONCA 366  where there was a strong public issue that required determination.

The General Principles of Moot Court Cases

31      Where, as here, the dispute between the parties has disappeared, the court still retains the discretion to proceed to hear the merits of the appeal: Borowski v. Canada (Attorney General), [1989] 1 S.C.R. 342 (S.C.C.), at p. 353.

32      The exercise of that discretion is guided by a consideration of the presence or absence of the three rationales underpinning the mootness doctrine:

(i) whether the issues can be well and fully argued by parties who have a stake in the outcome;

(ii) the concern for judicial economy; and

(iii) the need for the court to remain alive to the proper limits of its law-making function in order to avoid intrusions into the role of the legislative branch: Borowski, at pp. 358-63; Ontario Provincial Police Commisioner v. Mosher, 2015 ONCA 722, 330 C.C.C. (3d) 149 (Ont. C.A.), at paras. 31-32. The interplay amongst the three rationales was described in Borowski at p. 363:

In exercising its discretion in an appeal which is moot, the Court should consider the extent to which each of the three basic rational for enforcement of the mootness doctrine is present. This is not to suggest that it is a mechanical process. The principles identified above may not all support the same conclusion. The presence of one or two of the factors may be overborne by the absence of the third, and vice versa.

Application of the principles in Moot Court Cases

33      Applying these criteria to this appeal, I have no concern about the absence of an adversarial relationship. Counsel for both parties argued the appeal with the same vigour as if the matter were not moot.

34      Regarding the factor of judicial economy, I am persuaded that although this is a case capable of repetition, it is one that could be evasive of review by this court given the costly three-stage appeal process involved: Borowski, at pp. 360, 364; Mosher, at para. 34

35      As well, there exists a strong public interest in the resolution of the legal issues raised by this appeal: Tamil Co-operative Homes Inc. v. Arulappah (2000), 49 O.R. (3d) 566 (Ont. C.A.), at paras. 25 and 26. The parties point to the long-standing practice in this province of including in separation agreements and court spousal and child support orders provisions requiring a payor spouse to maintain life insurance coverage and name the recipient spouse and children as beneficiaries under the policy. The effect of the Divisional Court’s decision is to expose such life insurance proceeds to competing claims under the SLRA from other children and former or subsequent spouses of the deceased payor. The implications of the Divisional Court decision will be felt well beyond the boundaries of this case.

36      Finally, the parties are not asking the court to decide an abstract question and thereby intrude improperly into the legislative sphere: Borowski, at p. 365. The issues raised by the parties are grounded in the specific facts in the record. The appeal was fully argued by interested parties based on a complete record, which puts the court in a position to make a fully informed decision on the issues of public importance raised by the appeals.

37      For these reasons, I would exercise our discretion to determine the issues raised in the appeal despite its mootness.

Release of Claims and Different Claim

Release of Claims and Different Claim

Bykerk v Kappalka Estate 2017 BCSC 655 discussed a previous Release of Claims signed by the parties to a second court action under the Wills Variation act (Section 60 WESA) and found that the Release was not binding to prevent the latter claim. The court found that there was no res judicata or issue estoppel  present.

A father had sued a daughter and her spouse for the alleged removal of chattels from his farm. The daughter and her spouse counter claimed for unpaid wages.

After the  father died, the daughter brought an action against  her father’s estate and its sole beneficiary for relief for father’s failure to made adequate provision for daughter in will. The estate and beneficiary brought an application for  an order dismissing action based on the signed release of  the prior action, but the application for dismissal was dismissed and the Wills Variation claim was allowed to proceed.

The Court reason that the potential claim under the wills variation claim could not have arisen against estate until father died leaving a will, so release was not bar to a claim under section 60 of WESA.

For the same reason, the doctrines of issue estoppel and cause of action estoppel did not bar claim under S. 60 WESA, nor could the  consent dismissal order for the prior action  bar the subsequent  action.

The signed Release of Claims  was a contract that was  not ambiguous.

That first action was resolved by a Release of Claims that stated in part:

KNOW ALL MEN BY THESE PRESENTS that in consideration of the total payment by or on behalf of BERNARD KAPALKA and BERNIES LTD. (collectively the “Releasees”), of the sum of $125,344.89 plus 50% of accrued interest plus the sum of $25,000.00 as a contribution to costs and disbursements and the interest of Bernard Kapalka in 2950 Sallenback Road and other good and valuable consideration, the receipt of which is hereby acknowledged, BERNADINE BYKERK and WILLIAM BYKERK (the “Releasors”), DOE_ [sic] HEREBY REMISE, RELEASE AND FOREVER DISCHARGE the Releasees, their heirs, executors, administrators, successors and assigns of and from any and all manner of actions, causes of action, suits, debts, contracts, claims, demands and damages of any nature or kind whatsoever, which as against the Releasees, their heirs, executors, administrators, successors and assigns the Releasors and their heirs, executors, administrators and assigns now have or at any time hereafter can, shall or may have for or by reason of or arising out of or relating to the issues which are the subject of an action brought by the Releasees in the Supreme Court, Vernon Registry, Action No. 43038 (the “Action”) and a Counterclaim by the Releasors in the same action.

 

 

 

Hearsay Evidence In Vancouver Estate Disputes

Hearsay Evidence In Vancouver Estate Disputes

Hearsay evidence is very common in Vancouver estate disputes and generally speaking is allowed by the courts subject to a few principled rules so long as it is not relied upon for “the truth of its contents”.

Hearsay evidence was discussed in Horton v Bruce 2017 BCSC 712 which adopted the principled approach set out at para. 30 in Harshenin v. Khadikin, 2015 BCSC 1213 (B.C. S.C.), citing R. v. P. (R.) (1990), 58 C.C.C. (3d) 334 (Ont. H.C.).

Justice Dardi stated that, on the “principled approach” to hearsay exception, hearsay evidence is presumably inadmissible when relied upon for the truth of its contents, however, if the statement is not proffered for its truth but rather offered pursuant to a well-established exception such as the deceased person’s state of mind, the hearsay evidence is then admissible.

4 rules of hearsay evidence in Vancouver estate disputes:

[33] The onus is on the party tendering the hearsay evidence to establish the necessity and reliability on a balance of probabilities. The court in this case must assess both the threshold reliability of the statement at issue and the statement’s ultimate reliability having regard to the entirety of the evidence…

[34] In this case, because the declarant is deceased, necessity is clearly established. That leaves for determination the issue of the reliability of the various statements attributed to the Deceased.

[35] A court is required to assess the reliability of a statement sought to be adduced by way of hearsay evidence by examining the circumstances under which that statement was made. A circumstantial guarantee of trustworthiness is established if the statement was made in circumstances which “substantially negate” the possibility that the declarant was untruthful or mistaken…

[36] As a preliminary threshold issue, the court must first find on a balance of probabilities that the statement was made by the Deceased before it goes on to determine the treatment and weight of such evidence: Creutz v. Estate of Kristian Winther, 2007 BCSC 1463 at para. 99. In essence, this assessment turns on the credibility of the various witnesses…

 

Dismissal For Delay (Want of Prosecution)

Dismissal For Delay (Want of Prosecution)

PMC Builders & Developers Ltd v Country West Construction Ltd 2009 BCCA 535 is one of the leading cases in BC for dismissal of a court action for delay, also known as want of prosecution.

It was recently followed in an estate case Re Strom estate 2017 BCSC 824 where the court declined to dismiss the case for delay in proceeding with the case to resolution.

It is a fact that a certain number of court cases are commenced and then never set for trial and sit for literally years without being resolved. It is open to the opposing party to apply to dismiss such an  action for delay. The courts will not dismiss an action for delay lightly and will review a number of criteria, especially any prejudice caused to the opposing party by the delay.

The test essentially is on balance is it in the interest of justice to dismiss the case for delay.

Dismissal For Delay: The Law

Lengthy delay by a plaintiff in bringing a claim to trial must be carefully considered in the context of evidence presented by both sides as to actual prejudice to the defendant in presenting its case at trial. Any prejudice will only be material to the extent that it was caused by the plaintiff’s inordinate delay, not by other events.

20      As Esson J.A. said in Tundra Helicopters Ltd. v. Allison Gas Turbine, 2002 BCCA 145, 98 B.C.L.R. (3d) 238 (B.C. C.A.), at para. 37: “It is no light matter to dismiss an action for want of prosecution.” He continued:
As Diplock L.J. said in Allen v. Sir Alfred McAlpine & Sons Ltd., [[1968] 2 Q.B. 229 (C.A.)] at p. 259:
The application is not usually made until the period of limitation for the plaintiff’s cause of action has expired. It is then a Draconian order and will not be lightly made. It should not in any event be exercised without giving the plaintiff an opportunity to remedy his default, unless the court is satisfied either that the default has been intentional and contumelious, or that the inexcusable delay for which the plaintiff or his lawyers have been responsible has been such as to give rise to a substantial risk that a fair trial of the issues in the litigation will not be possible at the earliest date at which, as a result of the delay, the action would come to trial if it were allowed to continue.
21      Country West brought its motion in the present case well before expiration of the applicable limitation period in contract. I will return later to this aspect of the matter.
22      The appellant offered no explanation for the delay in prosecuting its claims and, as I have said, conceded before the chambers judge that the delay was inordinate and not excusable. I would not say, however, that the appellant’s conduct was contumelious. The appellant was merely
23      In addition to Tundra Helicopters , the leading cases in this court on R. 2(7) are Irving v. Irving (1982), 38 B.C.L.R. 318 (B.C. C.A.) and Busse v. Robinson Morelli Chertkow (1999), 63 B.C.L.R. (3d) 174 (B.C. C.A.).
24      In Irving, the action was brought by a wife against her husband for an interest in her husband’s business. The action was founded in partnership and quantum meruit. It remained dormant for ten years until the husband sought dismissal for want of prosecution. This was denied by a chambers judge but granted on appeal. The evidence was that the delay was a deliberate tactic in the hope that the law would change. Eventually the law did change in the case of Becker v. Pettkus, [1980] 2 S.C.R. 834 (S.C.C.), and the wife sought an amendment in her action to plead a constructive trust remedy. This court emphasized that the delay was deliberate and tactical as opposed to being negligent or caused by illness or impecuniosity. In addition, the court found that there was a direct conflict in the evidence of the husband and the wife as to the involvement of the latter in the business and that the husband was denied the testimony of several independent witnesses who had died and who would likely have been able to give material evidence in the area of conflict. There was a finding of specific prejudice.
25      In Irving, the court adopted the principles governing an application for dismissal for want of prosecution – delay and prejudice – as discussed in the Allen v. Sir Alfred McAlpine & Sons Ltd. [[1968] 2 Q.B. 229 (Eng. C.A.)] case in the passage I have already set out. At p. 328, Seaton J.A. said this:
The demonstration of inordinate delay, inexcusable delay and serious prejudice does not lead necessarily to dismissal. Those three factors are only the primary considerations; all of the circumstances must be considered. It is still for the courts to decide “whether or not on balance justice demands that the action should be dismissed”. Salmon L.J. in Allen v. Sir Alfred McAlpine & Sons Ltd. All of the statements of law are subject to the overriding principle that essential justice must be done. (See Freeman J.A., as he then was, in Ross and Ross v. Crown Fuel Co. Ltd. et al (1962), 41 W.W.R. 65 at 88, 37 D.L.R. (2d) 30 (Man.C.A.).)
26      In Busse, the action was framed in misrepresentation, breach of trust and breach of fiduciary duty against several defendants. The events giving rise to the litigation occurred in the early- to mid-1980s. The action was commenced in 1991 and more than six years later the defendants brought motions to dismiss for want of prosecution. The chambers judge adjourned the applications for consideration by the trial judge. In so doing, he applied obiter dictum given by Lambert J. A. in concurring reasons in Irving. On appeal, this court applied the statement of the law given by Seaton J. A. in Irving with reference to what was said in Allen. The delay was inordinate and inexcusable. It was intentional and for tactical purposes. There was “a strong likelihood of actual prejudice” to the defendants in presenting their cases at trial. The action was dismissed.
27      These cases suggest to me that a chambers judge charged with the hearing of an application for dismissal of an action for want of prosecution is bound to consider the following:
(1) the length of the delay and whether it was inordinate;
(2) any reasons for the delay either offered in evidence or inferred from the evidence, including whether the delay was intentional and tactical or whether it was the product of dilatoriness, negligence, impecuniosity, illness or some other relevant cause, the ultimate consideration being whether the delay is excusable in the circumstances;
(3) whether the delay has caused serious prejudice to the defendant in presenting a defence and, if there is such prejudice, whether it creates a substantial risk that a fair trial is not possible at the earliest date by which the action could be readied for trial after its reactivation by the plaintiff; and
(4) whether, on balance, justice requires dismissal of the action.
28      I consider the fourth question to encompass the other three and to be the most important and decisive question.