Hearsay Evidence Admitted as Necessary and Reliable

hearsay social

The test for hearsay evidence in short is, is  it necessary and reliable

The Ontario Appeal Court recently admitted statements made by a deceased to family members prior to his death as evidence of his insurer’s mistaken cancellation of one of the deceased’s accidental death policies in Brisco Estate v. Canadian Premier Life Insurance Co. (2012), 113 O.R. (3d) 161, 299 0.A.C. 283, 16 C.C.L.I. (5th) 45, 2012 ONCA 854, 2012 CarswellOnt 15259, 82 E.T.R. (3d) 211(Ont. C.A.). In its decision, the Court clarified the scope of the corroboration requirement of section 13 of the Evidence Act as well as the role corroboration can play in admitting hearsay evidence.

Robert Brisco (“Brisco”) died in a plane crash in 2004. Previously, Brisco had purchased two insurance policies through Canadian Premier Life Insurance Company (“Canadian Premier”) in January 1998: an accidental death policy and a hospital benefits policy. Canadian Premier contended that Brisco had cancelled the accidental death policy in August 1998. Brisco’s estate argued that Brisco had meant to cancel the hospital benefits policy, but that Canadian Premier had cancelled the accidental death policy by mistake. If the accidental death policy was in effect, Brisco’s estate would be entitled to $1,000,000. Brisco had also held another $1,000,000 accidental death policy with a different insurer.

As evidence of the mistake, Brisco’s brother (as estate trustee) and Brisco’s three children each gave evidence that Brisco had made statements to them at various times subsequent to 1998 that indicated he believed he held two million-dollar policies. Although these statements were hearsay, the trial judge admitted the evidence under the “state of mind” exception. Canadian Premier appealed, claiming that Brisco’s statements were inadmissible or, in any event, not corroborated pursuant to section 13 of the Evidence Act.

The Court of Appeal dismissed the appeal. Although the trial judge had erred in admitting the statements under the “state of mind” exception, the statements were admissible under the principled approach to hearsay. As well, the statements made by the deceased to his children did not require corroboration (as explained below) but in any event were

.

Section 13 provides as follows:

In an action by or against the heirs, next of kin, executors, administrators or assigns of a deceased person, an opposite or interested party shall not obtain a verdict, judgment or decision on his or her own evidence in respect of any matter occurring before the death of the deceased person, unless such evidence is corroborated by some other material evidence.

After quoting extensively from Wigmore in Evidence and its criticisms of such survivor disqualification statutes, of which few remain, Rosenberg J.A., writing for the Court, wrote:

Given its anomalous place in the modern law of evidence, especially in a case such as this, I see no reason to give s. 13 a broad interpretation when considering its application nor a narrow interpretation when considering the scope of evidence capable of corroborating the evidence of the interested party.

The Court clarified that section 13 only applies to interested parties who make the claim in their capacity as next of kin, executor, administrator or assignee and not simply because, coincidentally, the person happens to fall within one of those categories. Thus, in this case section 13 only applied to Brisco’s brother as estate executor and not to Brisco’s children because, even though they were estate beneficiaries, they were bringing the suit under a contractual right as beneficiaries of an insurance policy.

In any event, the Court found that the evidence of Brisco’s brother and his children corroborated each other. Importantly, the Court confirmed that several pieces of circumstantial evidence, even if not sufficient on their own, when viewed cumulatively, can corroborate the evidence of an interested party. In this case, the Court accepted that evidence such as the fact that no letter was sent by the insurer confirming the cancellation of the accidental death policy, together with the improbability that Brisco would have chosen to cancel the accidental death policy given the other policies he maintained, the recorded discussions about those policies and that he had just purchased the policy months before, as cumulatively corroborating the evidence of Brisco’s brother (and his children, if need be) sufficient to meet the section 13 requirement.

The Court held that Brisco’s statements were inadmissible under the “state of mind” exception because evidence of present intentions or present beliefs are not admissible to establish past acts.

However, the Court admitted the evidence as necessary and reliable under the principled approach to hearsay. Necessity was established because Brisco was deceased. As sufficient indicia of reliability, the Court pointed to the consistency of the various statements, that there was no obvious motive for Brisco to have lied when he made the statements, at least one statement was made under circumstances of solemnity, and that it was unlikely that Brisco would have forgotten he cancelled a million-dollar policy.

The Court also explained that reliability can be bolstered where there is evidence to confirm or corroborate the accuracy of the statements. As such, the Court looked to the same corroborating evidence discussed in its section 13 analysis in finding the hearsay statements reliable, and therefore admissible under the principled approach.

Courts Summary Dismissal of Capacity/Undue Influence Claim

Courts Summary Dismissal of Capacity/Undue Influence Claim

Summary Dismissal  of Capacity and Undue Influence Claims

Orfus Estate v. Samuel & Bessie Orfus Family Foundation 86 E.T.R. (3d) 6, is an Ontario Court of Appeal case that upheld the summary dismissal of a daughter’s claim of lack of capacity and undue influence re her mother’s $20 million estate.

The law re the Wills Variation act is quite different in Ontario that BC, but disinherited.com believes that the reasoning of this case would be applied in BC Courts.

Court cases that are heard “summarily” are based on affidavits rather than live witnesses, and are generally agreeable to the court provided that issues of who to believe are not in dispute.

S and E were daughters of the testator, and S was estranged from both the testator and her sister E.

The Testator was involved in a successful real estate business, and he made two wills, and S was treated less generously than E.

S began corporate oppression proceedings in respect of the companies, and was to receive $9 million as result of the wind-up of the companies.

The Testator made codicil to wills, in which she cut S out of her estate, save for nominal $1,000 bequest.

The Testator died, leaving an estate of nearly $20 million.

S gave notice of objection to wills and codicil, claiming absence of testamentary capacity or approval of contents of wills and codicil, as well as undue influence on the part of E.

The Trustees brought a successful motion for summary judgment to dismiss S’s objection .

S appealed and the Ontario Court of Appeal dismissed the appeal, finding that the Motion judge did not err in finding that testator knew and approved of contents of her codicil.

The motion judge correctly found that suspicious circumstances existed because E provided all instructions for codicil and benefited from codicil by receiving half of assets that had been designated for S under wills.

Therefore, the presumption of knowledge and approval could not be relied upon , however, the motion judge found, without error, that the trustees met the burden of proving knowledge and approval on balance of probabilities.

There was no evidence that the testator lacked capacity or that her cognitive abilities changed at relevant time — On the contrary, there was also positive evidence, being S’s position in the oppression litigation and the testimony of her family doctor.

The Law

“Admittedly, Bessie Orfus duly signed her codicil. And, ordinarily on proof of due execution, it will be presumed that the testator knew and approved of the contents of the testamentary instrument and had testamentary capacity. But that presumption will not apply where suspicious circumstances are present: see Vout v. Hay, [1995] 2 S.C.R. 876(S.C.C.), at p. 889.

Here, the motion judge correctly found that suspicious circumstances existed. They existed because Elaine provided all the instructions for the codicil to Botnick and because she benefited from the codicil by receiving half the assets that had been designated for Sharon under the 2004 wills.”

84 Thus, the estate trustees could not rely on the presumption. They had to prove on a balance of probabilities that Bessie Orfus knew and approved of the contents of her codicil, indeed that she had testamentary capacity. The motion judge found that they met their burden, and I am not persuaded that he erred in making that finding.

85 As the motion judge noted, no evidence was led that Bessie Orfus lacked testamentary capacity in December 2004 or that her cognitive abilities had changed in any way between May and December 2004. In addition to this “negative” evidence, however, there are two cogent pieces of positive evidence that reasonably support the motion judge’s finding.

Administrator Pendente Lite

Administrator Pendente Lite

It is a frequent occurrence in estate litigation that situations arise where the executor is unable to act, or there is no executor or administrator at all, and the validity of the will or the estate is very much in question.

In such circumstances it is absolutely necessary that it administrator be appointed to essentially preserve the assets of the estate, ”pending the litigation”, or in Latin, pendante lite.

The parties typically agree on a neutral person to be appointed as administrator pendante lite and a court application is made to chambers for such an order.

Such administrator has all the rights and powers of a general administrator, other than the right to distribute the estate assets.

He or she is very much subject to the control of the court, and acts under its direction, and the authority of section 8 of the Estate Administration act.

The purpose of this appointment is to provide interim administration of the estate until the action as being concluded, and basically nothing else.

Once the action has been concluded, this grant will cease, either upon the will been proved and probate granted, or upon the will being set aside and letters of administration granted in its place.

Courts frequently ask that administrators pendante lite be bonded, or that some other restriction be ordered such as real property not be sold or mortgaged without further order of the court.

A creditor or any person beneficially interested in the estate me apply for the appointment of an administrator pendante lite. Generally the court will not appoint a party to the litigation as administrator vessel the creditors and persons would agree to do so, but there is no absolute rule to this effect, it is just generally a conflict.

The court application is brought in these same litigation that is challenging the estate, and usually has an affidavit of the proposed administrator setting out the assets, the litigation, and the proposal.

Equity Depends On the Length of the Lord Chancellor’s Foot?

equity 3

‘Equity is a roguish thing: for law we have a measure, know what to trust to; equity is according to the conscience of him that is Chancellor, and as that is larger or narrower, so is equity. ‘Tis all one as if they should make the standard for the measure we call a foot, a Chancellor’s foot; what an uncertain measure would this be? One Chancellor has a long foot, another a short foot, a third an indifferent foot: ’tis the same thing in a Chancellor’s conscience.’

 

-17th cent. J Selden, Table Talk, quoted in M B Evans and RI Jack (eds), Sources of English Legal and Constitutional History, Butterworths, Sydney, 1984,223-224

Abuse of Process

Kellogg v Kellogg estate 2013 BCSC 946 involves a situation that is very common in estate litigation-a self represented plaintiff alleging serious allegations such as fraud or undue influence, lack of capacity and so forth,when in fact all of the allegations are groundless, and amounts to an abuse of process..

In the Kellogg case one of the testator’s three children applied for probate of the testator’s will, and was opposed by one of the other children, the plaintiff, alleged that the will was procured by fraud and undue influence.

The court pronounced the will in solemn form.

The plaintiff then appealed that order and commenced an action alleging that the defendant was not entitled to act as executor, and that he had obtained the grant of probate an appointment as executor through misrepresentation and fraud on the court.

On the defendant’s application to strike out the claim is disclosing no reasonable cause of action, the court also found that the plaintiffs action was an abuse of process, that included baseless allegations of fraud, and accordingly awarded special costs of $3500 against the plaintiff.

‘abuse of process is a flexible doctrine that allows the Court to prevent a claim from proceeding where it violates such principles as “judicial economy, consistency, finality and the integrity of the administration of justice”.

Toronto (City) v. C.U.P.E., Local 79, 2003 SCC 63 at para. 37.

(g) categories of abuse of process include those that “involve a deception on the court or constitute a mere sham; where the process of the court is not being fairly or honestly used, or is employed for some ulterior or improper purpose; proceedings which are without foundation or serve no useful purpose and multiple or successive pleadings which cause or are likely to cause vexation or oppression.”

Babavic v. Babowech, [1993] B.C.J. No. 1802 at para. 18 (S.C.).”

Court Appoints Majority Vote Trustee and Denies Judicial Trustee

Re Newton estate 2013 BCSC 799, involves a court application between two competing trustees to be appointed the third majority vote trustee of the family trust. When only two remaining trustees were unable to agree on a replacement. One of the trustees applied to appoint a well-qualified person for the trust position that was opposed by the other party on the basis that he was too friendly with the other trustee.

The dissenting trustee instead asks the court to appoint a Judicial Trustee, but the court refused and appointed the friend of the family who was better qualified.

The trust document require that there be three trustees but did not delineate that any one of them should be an independent, institutional or corporate trustee.

The instrument further was broad in its scope and who should be appointed as trustee, and a principle of law was that the wishes of the trust beneficiaries had to be held above other interests. Neither beneficiary objected to the appointment of the applicant, and in fact they promoted. The other concern that the court has in these situations is that the appointment should promote as opposed to impede the execution of the trust.

Appointment of a Trustee

[49] Pursuant to s. 31 of the Trustee Act, R.S.B.C. 1996, c. 464 (Ac)], the court may appoint a new trustee:

If it is expedient to appoint a new trustee and it is found inexpedient, difficult or impracticable to do so without the assistance of the court, it is lawful for the court to make an order appointing a new trustee or trustees, whether there is an existing trustee or not at the time of making the order, and either in substitution for or in addition to any existing trustees.

[50] The principles that guide the court’s discretion in appointing a new trustee were set out in the English Court of Appeal decision In Re Tempest, (1866) 1 Ch. App. 485 (Tempest) at 487 – 488:

[1.] … the Court will have regard to the wishes of the persons by whom the trust has been created, if expressed in the instrument creating the trust, or clearly to be collected from it. [2.] … the Court will not appoint a person to be trustee with a view to the interest of some of the persons interested under the trust, in opposition either to the wishes of the testator or to the interests of others of the cestuis que trusts. [3.] … the Court in appointing a trustee will have regard to the question, whether his appointment will promote or impede the execution of the trust, for the very purpose of the appointment is that the trust may be better carried into execution.

Appointment of a Judicial Trustee

[51] The Act also provides that the court has a discretionary power to appoint a judicial trustee:

97 (1) If an application is made to the court by or on behalf of the person creating or intending to create a trust, or by or on behalf of a trustee or beneficiary, the court may, in its discretion, appoint a judicial trustee to be a trustee of that trust, either jointly with any other person or as sole trustee, and, if sufficient cause is shown, in place of all existing trustees.

[52] The appointment of a judicial trustee was considered in Wright v. Canada Trust Company (1984), 55 B.C.L.R. 349 (S.C.) at 358 (Wright). The court discussed the function of a judicial trustee and the circumstances where an appointment will be warranted:

Judicial trustees are trustees appointed by the court in those circumstances where the court, on application of the settlor, intending settlor, trustees and beneficiaries, considers that such a person should be appointed. Persons not coming within one of the categories have no status or right to apply under this section. His duties will be determined by the court, and he will either act with the existing trustees or be authorized to act alone, or be required to act in place of the existing trustees. …

In Alexander v. Royal Trust Co., [1949] 1 W.W.R. 867, [1949] 2 D.L.R. 824, the Alberta Supreme Court [Appellate Division] considered s. 58 of the Trustee Act, R.S.A. 1942,c. 215, which is similar to s. [97] of our Trustee Act. The court said a judicial trustee should only be appointed for special reasons and where the circumstances warrant, e.g., where an administration of property by a trustee has broken down, or where the administration is being unduly prolonged and the court does not consider it proper itself to undertake the administration (followed in O’Kelly v. Canada Permanent Trust Co., [1972] 1 W.W.R. 41 (Sask. C.A.), and Re Burr (1968), 1 D.L.R. (3d) 78, (B.C.S.C.)

[53] In view of these reasons, the appointment of a judicial trustee will only be justified on the basis of “special reasons” where the circumstances warrant it.

“Legal Disability” In BC

legal disability

The term “legal disability” is only defined in the BC Rules of Court, and not in any other statute in this province. Rule 20-2(2) of the BC Rules of Court provides that “a proceeding brought by or against a person under legal disability must be started or defended by his or her litigation guardian.”

According to Rule 20-2(8)(a), persons under legal disability are infants or “mentally incompetent” persons.

The phrase “mentally incompetent person” is defined in the Interpretation Act, R.S.B.C. 1996, c. 238, s.29, to mean “a person with a mental disorder as defined by s. 1 in the Mental Health Act”.

The following definition appears in the Mental Health Act:

“person with a mental disorder” means a person who has a disorder of the mind that requires treatment and seriously impairs the person’s ability to react appropriately to the person’s environment, or to associate with others.

In Holland v. Marshall, 2009 BCCA 311 at paras. 29 and 37, Neilson J. A. held that the “environment” referred to in the definition of mental disorder contemplates the larger community of which the person was a part, and not just the environment of the court system and process. It was not enough that the plaintiff in that case had ADHD and memory problems because his mental disorder did not impair his ability to react appropriately to his environment or to associate with others. As such, he was not found to be legally disabled.

While the definition of “mentally incompetent” seems clear, the term “legal disability” has also been determined by the courts to mean something less stringent. In Pavlick v. Hunt, 2005 BCSC 285 at para. 20, for example, the court applied the definition of “a person under disability” found in Kirby v. Leather, [1965] 2 All E.R. 441 (Eng. C.A.), in which it was held by Lord Denning that the issue of whether or not a person was under a legal disability required a determination of: “whether or not the person had the capacity to exercise judgment in relation to the claims in issue in this lawsuit and possible settlement, as a reasonable person would be expected to do.”

– See more at: http://www.disinherited.com/blog/being-under-legal-disability-bc#sthash.Mq8vIT2D.dpuf

Promissory Estoppel

In Anderson v Anderson 2010 BCSC 911, the deceased prior to his death transferred his interest in a cottage to his second wife for one dollar and other good and valuable consideration.

 

The plaintiffs were the deceased’s children from his first marriage. For several years following the deceased’s death, the plaintiffs and their families continue to enjoy access to the recreational property.

 

The defendants second wife however plan to sell the cottage, and the plaintiffs commenced court action for a declaration that the defendant held the property in trust for the plaintiffs, or for relief based on the equitable doctrines of promissory estoppel or proprietary estoppel.

 

The action was dismissed as the court found that the deceased intended to make a gift of the cottage to his spouse, and that she did not hold the property on any conditions of trust.

 

disinherited.com has previously blogged on the issue of proprietary estoppel, but not promissory estoppel.

 

The following is a good excerpt of the law on promissory estoppel:

 

Promissory Estoppel

 

198 As a final point, I address the plaintiff’s claim based on promissory estoppel. Although some other jurisdictions have relaxed the restriction, the law in Canada is that promissory estoppel can operate only as a shield and not as a sword. In other words, promissory estoppel cannot create a new cause of action where none existed before: Romfo v. 1216393 Ontario Inc., 2007 BCSC 1375(B.C. S.C.); and Halsbury’s Laws of Canada, 1st ed., vol. Contracts (Markham, Ont.: LexisNexis, 2008) at 233.

 

199 In view of my findings that the plaintiffs have not established any actionable claim against the defendant, the plaintiffs’ claim must fail.

 

200 Moreover the Supreme Court of Canada in Maracle v. Travellers Indemnity Co. of Canada, [1991] 2 S.C.R. 50(S.C.C.) at 57 stated that a party who wishes to invoke the doctrine of promissory estoppel must establish:

 

1) That the other party by words or conduct made a promise that was intended to affect the parties’ legal relationship; and

 

2) That, in reliance on the promise, the party has acted or in some way changed his or her position.

 

201 The promise must have been unambiguous and precise; it must have been intended to have a “binding effect”: M. (N.) v. A. (A.T.), 2003 BCCA 297(B.C. C.A.) at para. 19.

Missing Persons and Presumption of Death Order

Missing persons

disinherited.com  obtained a presumption of death order for a missing person, after a police investigation concluded it was clearly a suicide by jumping from a bridge. Her body had not been found for several months and without giving away the details of her circumstances, there was no other conclusion to reach but that she jumped from a bridge and has never been found.

The problem in these types of cases is that at common law, a person had to wait 7 years to obtain such an order unless there was clear evidence for a court to decide to shorten that period of time and make a presumption of death order. In recent years it has become known that several people have faked their own deaths for a myriad of reasons and then surfaced many years later still alive.

The decision of is such – did the missing person disappear because he was a gangster and learned he had a hit on his life, or was he hit and now sleeping with the fish. In Cyr the Judge could not decide which it was and stated that the onus of proof on the balance of probabilities to prove the person is likely dead. Cyr’s application was opposed by an insurance company that refused to pay out on a life insurance policy. My application will not be opposed.

The issue is whether there is sufficient admissible evidence to make the declaration sought by Ms. Byrne. Her alternative, if Cyr is, in fact, dead, is to wait seven years from late October 2003, the date at which Cyr is last known to have been alive. This is because the common law presumes death if a person is not heard of or from for seven years.

[3] Section 3(1) of the Act provides:

3 (1) If, on the application of an interested person under the Rules of Court, the court is satisfied that

(a) a person has been absent and not heard of or from by the applicant, or to the knowledge of the applicant by any other person, since a day named,

(b) the applicant has no reason to believe that the person is living, and

(c) reasonable grounds exist for supposing that the person is dead,

the court may make an order declaring that the person is presumed to be dead for all purposes, or for those purposes only as are specified in the order.

The wording of subsection (c) suggests that the evidence need not establish death on a balance of probabilities but the case law to date in this province seems to import such a requirement. If there were not earlier decisions on the point, including the one discussed immediately below, I would not apply what I perceive to be a higher test than the Legislature intended.

[4] In Re Burgess, 2004 BCSC 62, the missing person had not been seen in the 22 months preceding the hearing. He was a family man who was greatly missed by his two children. The missing person had a historical association with the Hells Angels Motorcycle Club. Based on confidential information received, the police informed the wife of the missing person that the Hells Angels had killed her husband. The court accepted that evidence under the principled exception to the hearsay rule and concluded that the “dark side” of the missing person’s life had “caught up with him and the only reasonable inference is that his life has been ended by ‘person unknown'”. The court concluded on a balance of probabilities that the missing person died by misadventure.

[5] It appears that counsel invited the court to apply the test for proof of death law set out in the Saskatchewan Court of Appeal decision in Re Noga and Prudential Insurance Co. of America (1971), 20 D.L.R. (3d) 331, and the British Columbia Court of Appeal decision inMartin v. Prudential Insurance Company of America, [1954] 1 D.L.R. 762. Both those decisions were concerned with the proof of death required under the applicable provincial insurance legislation and not with survivorship and presumption of death legislation.

[6] In Noga, ss. 170 and 171 ofthe Saskatchewan Insurance Act, R.S.S. 1965, c. 143, permitted the court to make an order declaring that the evidence of death furnished to the insurance company was sufficient to establish the death of the insured. In Martin, the court addressed s. 128 of the Insurance Act, R.S.B.C. 1948, c. 164, which is described in the judgment as raising the sole question of “whether or not the husband of the respondent was dead”. Both cases address the effect of evidence of conflicting probabilities such that “the scales are left in equilibrium” (Noga at 334; Martin at 763) as between the presumption of continuing life and the presumption of death. In Noga, the court concluded that any choice between conflicting inferences of equal degrees of probability is conjecture and inadequate. Instead, there must be evidence to render one probability more reasonable than the other. The court applied that aspect of the test in Martin. If the authorities went no further, it might still have been open to me to apply a lesser test, more consonant in my view, with the wording of the Act in issue here.

[7] It is not open to me to do so. In Re Schmit, 12 B.C.L.R. (2d) 186 (C.A.), the Court of Appeal considered s. 3 of the Act and held, albeit without any discussion, that the applicant was required “to show on the balance of probabilities that the death took place as she alleges” (at 189). I am bound by Re Schmit. I conclude that I must proceed on the basis that Ms. Byrne is required to prove, on a balance of probabilities, the death of Cyr as she alleges.

[8] While there is a reasonable basis for believing that Cyr is dead, there is also some basis for concluding that he has chosen to disappear. I am unable to find on a balance of probabilities that he is dead.

[9] Cyr and Ms. Byrne have a young son. There is strong evidence that Cyr had a very close relationship with his son. It is clear that Cyr moved to Victoria to be near his son and that he took full advantage of his access to the child. I am satisfied that the relationship was a close and loving one. Ms. Byrne invites me to infer from that evidence that Cyr would have been in contact with his son if he were still alive but I do not agree that is the only available inference. If Cyr decided to disappear for the possible reasons set out later, he would be very careful not to contact Ms. Byrne or his son.

[10] At the time of his disappearance, Cyr owned a house in Victoria worth about $1.5 million. Since his disappearance, Cyr has not attempted to sell this property or use it to generate revenue or borrowings. It seems unreasonable that someone who is alive would disappear and leave such a valuable commodity behind. On the other hand, Cyr was a sophisticated businessman who was familiar with off shore corporations. It is likely that he earned money through the illegal drug trade and had sizable hidden assets. He may have had the financial ability to disappear independently of the property in Victoria.

[11] There is evidence that Cyr, as a youth, sold drugs and associated with the Hells Angels. In October 2003, he told his ex-wife that he had to go to Vancouver. The Vancouver police have since informed Ms. Byrne that Cyr was “taken out” by underworld connections and “suffered at hands of associates”.

Proprietary Estoppel- Farm Promised Over Years Awarded

farm promised Proprietary Estoppel:

Sabey v von Hopffgarten Estate 2013 BCSC 64  NB- OVERTURNED ON APPEAL)  is an excellent example of a plaintiff receiving his just claim through the equitable principles of proprietary estoppel.

The plaintiff worked on the deceased’s horse farm for many years, being assured that the farm would be his one day when the couple died. Their wills in fact did leave the farm to the defendant, although the testators had executed subsequent odicils leaving the farm to the plaintiff, the codicils were invalid for lack of proper witnesses. The court held for the plaintiff and applied the broad approach endorsed by the court of appeal. The plaintiff also succeeded on proprietary estoppel as he developed a gradual understanding that he was to be given the farm after their deaths, largely based on his credible evidence that they said this to him any times over the years.The plaintiff relied upon those assurances , and organized his time and work on the assumption that it was to be his. It was not incumbent on the plaintiff to show an economic loss, as his reliance and detriment are often one and the same. Equity demanded that the plaintiff be granted the farm.

PROPRIETARY ESTOPPEL

[41] The plaintiffs primary claim is based on proprietary estoppel.

A. Principles of proprietary estoppel

[42] The Court of Appeal has endorsed the broad approach to proprietary estoppel that had been previously adopted by the courts in England. (This is opposed to the older English approach of looking at a five-part test set out by Fry J. in Willmott v. Barber (1880), 15 Ch. D. 96.) In Sykes v. Rosebery Parklands Development Society, 2011 BCCA 15 at paras. 44-46, the Court of Appeal cited with approval the following statement from Halsbury’s Laws of England, 4th ed. vol. 16 (London: Butterworths, 1992) at para. 1072:

The real test is said to be whether upon the facts of the particular case the situation has become such that it would be dishonest or unconscionable for the plaintiff, or the person having the right sought to be enforced, to continue to seek to enforce it.

[43] The broad approach is not without some rigour. As noted by Mummery LJ, in Scottish & Newcastle Pic. v. Lancashire Mortgage Corporation Ltd., [2007] EWCA Civ 684 at para. 23:

… It is not enough for [the plaintiff] simply to assert to the court, as if it were sitting under a palm tree on a legal and evidential desert island, that it would be unfair for [the defendant] to rely on their statutory right to priority.

Therefore the courts have normally looked to three main elements as a foundation for a proprietary estoppel claim: a representation made to the claimant; reasonable reliance on the representation; and a detriment to the claimant flowing from the reliance.

Thorner v. Major, [2009] UKHL 18 per Lord Walker at para. 29 Suggitt v. Suggitt, [2012] EWCA Civ 1140 at para. 19

 

[44] At para. 47 of Sykes, Finch C.J. said this of detrimental reliance:

While detrimental reliance is sometimes identified as a necessary element, it is perhaps better to consider it as part of the question of unconscionability. In the absence of detrimental reliance it would rarely, if ever, be unconscionable to insist on strict legal rights: see Harpum, Bridge and Dixon, Megarry & Wade: The Law of Real Property, 7th ed. (London: Sweet & Maxwell, 2008) at 711.

[45] In Suggitt, the English Court of Appeal recognised that reliance and detriment often overlap:

He [the trial judge] was satisfied that there was both reliance and detriment and he dealt with both of those matters separately. They are clearly connected matters; reliance is what a person does on the faith of some matter and detriment is usually the result: they are very closely connected. Clearly, the same factual matters may show both reliance and detriment. That is why Walker LJ held in Gillett v Holt at 225 that the concepts were “often intertwined”, (at para. 35)

[46] A central issue in this case is the nature or quality of the assurances. This was also a major issue in Thornerv. Major, which dealt, in part, with the issue of whether the assurances have to be unequivocal and certain. In that case, the trial court found that over the course of 30 years, the plaintiff did substantial work on a relative’s farm without pay because the relative encouraged the plaintiff to believe that he would inherit the farm. There was no express promise, but the Law Lords found that was not necessary in order for the plaintiff to succeed. As stated by Lord Rodger at paras. 24 to 26:

Given the actual situation, there was never going to be what Mr Simmonds described as a “signature event”, such as a family wedding or christening, at which Peter would make a dramatic announcement, in front of the assembled family, about the destination of his estate. Indeed, since Peter was in the habit of saying so little, it was scarcely to be expected that he would ever address the matter directly. But the judge found – and the Court of Appeal accepted – that, by his oblique remarks on a number of occasions, Peter had intended to indicate to David that he was to inherit Steart Farm. David interpreted Peter’s remarks in the way that he intended.

The contention for the respondents was that, even though David had correctly interpreted Peter’s remarks as assurances about inheriting the farm, his remarks were not “clear and unequivocal”. There was therefore no way of saying that they were intended to be relied on and they could accordingly not give rise to an estoppel. I would reject that contention.

Even though clear and unequivocal statements played little or no part in communications between the two men, they were well able to understand one another. So, however clear and unequivocal his intention to assure David that he was to have the farm after his death, Peter was always likely to have expressed it in oblique language. Against that background, respectfully adopting Lord Walker’s formulation, I would hold that it is sufficient if what Peter said was “clear enough”. To whom? Perhaps not to an outsider. What matters, however, is that what Peter said should have been clear enough for David, whom he was addressing and who had years of experience in interpreting what he said and did,

[Emphasis added]

[47] Lord Hoffman said, at para. 8, that it would be unrealistic to try to pinpoint an exact date at which an assurance became unequivocal. Lord Walker, with whom all the other Law Lords concurred, said at para. 56:

/ would prefer to say (while conscious that it is a thoroughly question-begging formulation) that to establish a proprietary estoppel the relevant assurance must be clear enough. What amounts to sufficient clarity, in a case of this sort, is hugely dependent on context. I respectfully concur in the way Hoffmann LJ put it in Walton v Walton (in which the mother’s “stock phrase” to her son, who had worked for low wages on her farm since he left school at fifteen, was “You can’t have more money and a farm one day”). Hoffmann LJ stated at para 16:

‘The promise must be unambiguous and must appear to have been intended to be taken seriously. Taken in its context, it must have been a promise which one might reasonably expect to be relied upon by the person to whom it was made.”

[48] On a somewhat related note, proprietary estoppel is retrospective in two senses. First, past events can inform subsequent events, and vice versa. Lord Hoffman said, at para. 8:

Past events provide context and background for the interpretation of subsequent events and subsequent events throw retrospective light upon the meaning of past events. The owl of Minerva spreads its wings only with the falling of the dusk. The finding was that David reasonably relied upon the assurance from 1990, even if it required later events to confirm that it was reasonable for him to have done so.

[49] Second, it looks back in time to assess the equities of the situation. As stated by Lord Neuberger at para. 101:

As Hoffmann LJ memorably said in Walton v Walton (unreported, 14 April 1994), para 21, “equitable estoppel [by contrast with contract]… does not look forward into the future [; it] looks backwards from the moment when the promise falls due to be performed and asks whether, in the circumstances which have actually happened, it would be unconscionable for the promise not to be kept”.

[50] The House of Lords in Thomer v. Major noted that what the representor actually intended was irrelevant. The issue is what the representations would reasonably convey to the plaintiff. Further, it is unnecessary for the representor to know that the plaintiff was thinking about alternate courses of action when the assurances were given.

PROPRIETARY ESTOPPEL