The words used in many wills are often ambiguous or capable of different interpretations,which often then results in a court application to determine the meaning of the words used in the will.
Such was the case with the use of the words “money and cash” in the case of ThIemer Estate v Clapper 2012 BCSC
The deceased’s estate consisted of a variety of various assets, including shares in three private companies, bank accounts, GIC’s, a mortgage, property, an income tax refund, a death benefit and personal effects.
His will directed that his surviving spouse be paid ” the balance of any money left at the time of my death”.
His will defined ‘money” to specifically include ” shares”
The remaining assets in the residue were to be held in a spousal trust for her lifetime and then after her death were to go to various family members
The executor brought a Petition to court to determine which assets were included in the ‘money’ bequest.
The court held that shares in a private company could not readily be converted into money such as shares in a public company can, so the private shares were not included in ‘money”, and the court held that the testator only interned his shares in private companies to be included in the definition of ‘money”
The fact that the testator did not own any public shares was not determinative, as if the shares in the private company were included then there would be very little residue, and would be inconsistent with the overall intention of the will
The management of the private companies was demanding and complex and it was consistent that the shares would go into the spousal trust and be managed by the lawyer and accountant who were appointed the executors.
The bank accounts and GiC’s were clearly cash and money, but the mortgage was not as it was more akin to an interest in land
Similarly, the death benefit and income tax returns could not be included as they were not payable until after death
Lastly, the shareholders loans were not included as the viability for payment depended on the companies solvency and liquidity
– See more at: http://www.disinherited.com/blog/money-and-cash-interpretted-will#sthash.7LN9yWB3.dpuf
Young v Abercrombie 2008 BCSC 389involved an estate dispute relating to a conflict between the wording of the deceased’s will and the subsequent codicil to the will.
Donald William Abercrombie (“Donald”) died on December 16, 2005, leaving a will executed on November 19, 1981, and a codicil to the will executed on October 28, 2004. He was survived by his two adult children, Kim Amanda Young (“Kim”), the named Executor, and Barry Donald Abercrombie (“Barry”).
[3] Clause 4(d) of Donald’s will directs the Executor to:
… divide the rest and residue of my estate equally between my two children, KIM AMANDA ABERCROMBIE and BARRY DONALD ABERCROMBIE. If either of my said children shall predecease me leaving issue, then such issue shall take in equal shares per stirpes the share such child would have taken if living. If any of my said children shall predecease me leaving no issue, then the share to which such deceased child would have been entitled shall be transferred to my surviving child for his or her own use absolutely.
[4] The codicil sets out the following:
Should either of my children become incapacitated due to illness or accident it is my instruction that my Trustee invest my incapacitated child’s share of my estate into investments or a form of annuity. My Trustee shall have the sole discretion to invest monies and advance monies as she or he she sees fit.
In all other respects I confirm this will.
The court reviewed various rules of construction of wills and turned to the issue of the strong presumption that the probate courts have against finding an intestacy. The courts will where possible, construe a will so as not to lead to an intestacy.
“Further, in the construction of wills, there is a strong presumption against intestacy. This often-cited principle was articulated by Lord Esher, M.R. in Re Harrison Estate (1885), 30 Ch.D. 290 at 393-4, as follows:
There is one rule of construction, which to my mind is 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.
In Baldissera v. Baldassi (1997), 18 E.T.R. (2d) 128 (B.C.S.C.) at para. 10, Edwards J., citing The Canadian Law of Wills, vol. 2, confirmed that:
There is a presumption against intestacy and the court will prefer an interpretation of the will which avoids an intestacy.
And further, at para. 11, Edwards J. held:
The court on reading the will as a whole may conclude that the testator clearly intended to dispose of his entire estate. Once such an intention is clear the court will construe the will so as to give effect to the will in preference to a construction which will result in a partial or total intestacy.
A similar conclusion is found in Jankowski v. Pelek Estate, [1996] 2 W.W.R. 457, 131 D.L.R. (4th) 717 (Man. C.A.), where Helper J.A. at para. 76 stated, “[i]f the will is capable of two constructions, one which disposes of the whole estate and the other which leaves part of the estate undisposed of, the court will prefer the former.”
And finally, if it is reasonable to do so, the will and codicil should be read in harmony so as to avoid an intestacy. Donald clearly intended to dispose of his entire estate, and it is therefore the role of the court to construe his will and codicil in a manner that does so.
[36] Here, if an intestacy is the result, one of Donald’s children, Kim, will receive 75% of his estate, while the heirs of the other, Barry, will receive 25%. That result does not confirm Donald’s will; it re-writes it, both in respect of the bequest to Barry, and also to Kim. The intended equal sharing between Donald’s children would not be the result.
[37] In all of the circumstances, I have concluded that Donald’s will and codicil, when read together, provide for the vesting of one-half of the residue of Donald’s estate in Barry when Donald died.
Court Rectifies Will ( see Blog Dated March 24,2014 for the WESA update on the courts expanded powers to interpret wills)
Verity Estate v Fedorek 2012 BCSC 650 involves a successful application brought by the executor of the deceased to rectify the last will of the deceased on the basis that it was prepared in error and did not accurately reflect the testatrix’s instructions given to the drafting lawyer with respect to the disposition of the residue of her estate.
The last will dated 2003 directed the estate residue to be divided into halves, with one half divided equally among 10 surviving nieces and nephews and the other equally among the four children of an niece who had died in 1984.
On the application of the executrix, the court ordered rectification of the will, finding that the testatrix had intended the division of her residue into 11 shares, with one share to be divided among the four children of the niece who had died.
The power of the court to rectify will permits the court to delete words that were mistakenly included in the will, but not to add them.
The evidence clearly demonstrated the relationship between the testatrix and nieces and nephews was very close her previous wills had been drafted in the same manner of equal shares among the nieces and nephews. The deceased had no children and they were her next of kin.
The court found that her late solicitor either mistook your instructions, which was unlikely, or more likely, made an error in drafting the 2003 will.
The Court then gave an excellent summary of the alw in this area, starting with Dardi J’s excellent summary in Re Ali Estate 2011 BCSC 537:
“5. The parties agree on the essential principles of law which guide a court in the exercise of its power to rectify will. That power permits a court to delete words that were mistakenly included in a will, but not to add them. There is no suggestion by the petitioner that words ought to be added to the 2003 Will, but some authorities which discuss the question of whether words may be added are nevertheless useful on the application before me.
[6] One of those authorities is Re Ali Estate, 2011 BCSC 537, in which Dardi J. under the heading “Legal Framework”, provided a valuable discussion of the principles of law which are engaged by a wills rectification application. Paragraphs 21 to 27 should be quoted in full:
21. The Supreme Court has jurisdiction to sit both as a court of probate and as a court of construction. Notwithstanding that the single court is empowered with dual jurisdictions, historically the court has exercised its probate function and its interpretation or construction function in separate proceedings. In broad terms, when ruling upon the validity of a will, the court sits as a court of probate, and when interpreting a will, it sits as a court of construction. The divided jurisdiction is significant because the powers available to the court depend on which jurisdiction it assumes: Law Reform Commission of British Columbia, Report on Interpretation of Wills, LRC 58 (Victoria, 1982) at 1.
22. The jurisdiction exercised by a court of probate relates to whether the testamentary instrument submitted for probate represents the true last will and testament of a deceased and whether the named personal representative is entitled to administer the estate. In essence, a court of probate focuses on what constitutes the testamentary instrument of the testator and its validity. The inquiry pertaining to the validity of the testamentary document encompasses the issues of the capacity and the volition of the testator and whether the testator duly executed the testamentary document with knowledge and approval of its contents.
23. On the other hand, in exercising jurisdiction as a court of construction, the court is concerned with ascertaining the meaning of the testamentary documents that have been approved by the court in the exercise of its probate jurisdiction. It is axiomatic that court must interpret or construe a will in the form in which it has been admitted to probate.
24. In probate hearings, the court, in determining whether or not the document before it is truly the testator’s will, is permitted to consider extrinsic evidence, including direct evidence as to the testator’s intentions. That evidence may include copies of earlier wills and codicils, prior drafts of the will, and the notes of the solicitor who prepared the will. In contrast, the scope of admissible evidence is generally more constrained in a construction hearing. In that instance, a court may only consider the words of the will and if, applying the subjective approach, the evidence of the surrounding circumstances known to the testator at the time the will was made. Except in very restricted circumstances (such as equivocation), the court is not permitted to review direct evidence of the testator’s intentions on a construction application: British Columbia Law Institute, “Wills, Estates and Succession: A Modern Legal Framework,” in B.C.L.I. Report No. 45 (B.C., 2006) at 37.
25. It is in the context of these general principles that I next address the petitioner’s application for rectification.
26. At the outset, it is important to observe that the equitable remedy of rectification, as developed to permit a court to correct errors in contracts or other written documents, does not apply to wills: British Columbia Law Institute, “Wills, Estates and Succession: A Modern Legal Framework” at 36. I also note parenthetically that in British Columbia there is currently no legislation in force which confers powers on the court to rectify will.
27. However, the court, in exercising its probate jurisdiction, does have a limited power to rectify a mistake in a will where the language of the will fails to express the testator’s actual intentions. A will is only valid to the extent a testator knew and approved of its contents. As a constituent element of establishing the validity of a will, the court must be satisfied that the testator knew and approved of its contents. It is well established on the authorities that before a will is admitted to probate, the court may, in the exercise of its probate jurisdiction, delete words from a will that have been included without the testator’s requisite knowledge and approval: Alexander Estate v. Adams (1998), 51 B.C.L.R. (3d) 333, 20 E.T.R. (2d) 294 (S.C.) [Alexander Estate]; and Clark v. Nash (1987), 61 D.L.R. (4th) 409, 34 E.T.R. 174 (B.C.C.A.) [Clark].
[7] In Alexander Estate v. Adams (1998), 20 E.T.R. 394, Burnyeat J., of this Court, at paras. 19 and 20 wrote the following, under the heading “Burden of Proof in Mistake”:
A Court of Probate can review evidence which is relevant to the question of whether or not words included in the Will have been included without the knowledge and approval of the Testatrix. That evidence may include copies of earlier Wills and Codicils prior drafts of the particular Will, and as well as the notes and recollections of the solicitor preparing the Will. In this case, I have reviewed the two Wills, the two Codicils, and the affidavit of the solicitor who prepared the two Codicils and the 1996 Will in order to ascertain what instructions were provided by the testatrix.
…
The following passage from Williams, Mortimer and Summcks, supra, sets out the burden of proof:
… if the testator has duly executed his will the presumption is that he knew and approved of all its contents, and that presumption becomes very grave and a strong one and only to be rebutted by the clearest evidence in cases where the will was read over to the to testator. It is however, going too far to say that it must established beyond all doubt that the words which a party seeks to have omitted did not form part of the testator’s will. Furthermore, the reading over must be a proper one. But where the will was not read over to the testator and the mistake is made in circumstances in which the court may omit words or dispositions, the mistake may be established on a balance of probabilities. (at p.167)
[8] In Vout v. Hay, [1995] 2 S.C.R. 876, the court heard an appeal in which it was alleged there were “suspicious circumstances” surrounding the execution of a will. At para. 26, Sopinka J. for the court observed:
…Although the propounder of the will has the legal burden with respect to due execution, knowledge and approval, and testamentary capacity, the propounder, is aided by a rebuttable presumption. Upon proof that the will was duly executed with the requisite formalities, after having been read over to or by a testator who appeared to understand it, it will generally be presumed that the testator knew and approved of the contents and had the necessary testamentary capacity.
[9] The “propounders” of the 2003 Will are the Fedorek respondents.
[10] The jurisdiction of the English probate court to rectify will was modified and enlarged by the Administration of Justice Act, 1982. There is no similar legislation in British Columbia, but English authority on rectification of wills, prior to the coming into force of the English statute on January 1, 1983, continues to be persuasive in British Columbia.
[11] In Re Morris (deceased) [1970] 1 All E.R. 1057 a testatrix executed a will making a pecuniary legacy in sub clause 7[iv]. The testatrix later instructed her solicitor to prepare a codicil altering the provisions of sub clause 7[iv] but instead the solicitor mistakenly prepared a codicil which revoked all of clause 7, thereby depriving the beneficiary of the legacy. The testatrix took the codicil to her bank to execute it, “but there was no discussion about its meaning and effect”. The learned judge nevertheless held “the testatrix read it in the sense of casting her eye over it”.
[12] The learned judge in Re Morris addressed the history of the relevant law of England and referred to Guardhouse v. Blackburn, (1866) L.R. 1 P. & D. 109 [1861-73] All E.R. 680, which articulated a pronounced mid-Victorian reluctance to rectify will, even if it could be demonstrated that it did not actually conform with the testator’s wishes. Lord Penzance laid down what was characterized in Re Morris as “absolute rules” one of which was that “the fact that the Will had been duly read over to a capable testator on the occasion of its execution, or that its contents have been brought to his notice in any other way, should, when coupled with his execution thereof, be held conclusive evidence that he approved as well as knew the contents thereof”.
[13] The learned judge in Re Morris observed there must have been good reason for the court in Guardhouse v. Blackburn “to fetter its own power to get at the true facts. But has not the more modern trend in many fields been to strike such fetters off, so that the court can make the best use of all materials available to ascertain the truth?” and went on to quote with approval from an earlier English case in which it was held that the probate court on a rectification application is:
…to consider all the relevant evidence available and then, drawing such inferences as it can from the totality of that material, it has to come to a conclusion whether or not those propounding the Will have discharged the burden of establishing that the testatrix knew and approved the contents of the document which is put forward as a valid testamentary disposition. The fact that the testatrix read the document, and the fact that she executed it, must be given the full weight apposite in the circumstances, but in law those facts are not conclusive, nor do they raise a presumption of law.
[14] I should note that while the law of England may not raise a presumption of knowledge and approval if a will is read by a testator, but the law of British Columbia, as articulated in Vout v. Hay supra, appears to have retained a rebuttable presumption that a will reflects the intentions of the testator if it was read to or by the testator at the time of execution.
[15] In Re Morris supra the learned judge concluded:
In my judgment, wherever the line is drawn, this case on its facts falls into the category where the court has power to do what it can by omission. The introduction of the words ‘Clause 7’ instead of ‘Clause 7(iv)’ was per incuriam. The solicitor’s mind was never applied to it, and never adverted to the significance and effect. It was a mere clerical error on his part, a slip. He knew what the testatrix’s instructions and intentions were, and what he did was outside the scope of his authority. And he did it, of course, without knowing and approving what he himself was doing. How can one impute to the principal the agent’s knowledge and approval which the agent himself has not got? Accordingly, I hold that the testatrix was not bound by this mistake of the draftsman which was never brought to her notice. The discrepancy between her instructions and what was in the codicil was to all intents and purposes total and was never within her cognisance.
Forfeiture clauses in wills variation actions are not valid as a defence
Testators sometimes attempt to intimidate beneficiaries from contesting the will, by inserting punitive clauses called forfeiture clauses, purporting to take away a benefit given under the will, if the will is challenged.
These clauses may be enforceable in certain situations ( see article entitled Forfeiture Clauses in Wills on this website under articles), but they are NOT enforceable with respect to Wills variation actions.
Public policy dictates that spouses and children of a deceased should not be prevented from bringing a wills variation action.
This principle was confirmed in Kent v McKay 1982 BCJ 67
The testator provided in paragraph 9 of his will that:
I HEREBY WILL AND DECLARE that if any person who may be entitled to any benefit under this my Will shall institute or cause to be commenced any litigation in connection with any of the provisions of this my Will other than for any necessary judicial interpretation thereof or for the direction of the Court in the course of administration all benefits to which such person would have been entitled shall thereupon cease and I HEREBY REVOKE all said benefits and I DIRECT that said benefits so revoked shall fall into and form part of the residue of my Estate to be distributed as directed in this my Will; PROVIDED that if such person whose benefits are so revoked would otherwise share in the residue of my Estate his or her benefits so revoked shall be divided equally among the remaining shares into which the residue of my Estate may be divided or as if such person had predeceased me and had left no issue surviving me.
The Court followed the Australian decision of In the Will of Gaynor, deceased 1960 VLR 64, where a similar clause in a will was found void on the basis that offended public policy.
“17 It cannot be denied with respect that the intent of the Legislature in creating the Wills Variation Act (supra) is to ensure adequate maintenance and support for specified individuals. It is a matter of public policy that support and maintenance be provided for those defined individuals and it would be contrary to such policy to allow a testator to circumvent the provisions of the Wills Variation Act by the creation of such as paragraph 9. It is important to the public as a whole that widows, widowers and children be at liberty to apply for adequate maintenance and support in the event that sufficient provision for them is not made in the will of their spouse or parent. I have concluded that the intent of clause 9 was to prevent any such application. It is not necessary for the purposes of this decision to conjure up scenarios wherein inequitable and distressing results are created for a widow, or children by being deprived of maintenance and support while an “undeserving” beneficiary takes under a will.
Clause 9 therefore is void as against public policy.
2) if so, what was her wills variation action worth out of a $600,000 estate?
In June 2005, the plaintiff was on vacation in Australia when she met the testator.
She and he agreed that the plaintiff would apply to come to Canada and that the testator would sponsor her as his common-law wife.
In July 2006, the plaintiff moved in with the testator until her visitor’s visa expired .
In July 2007, the plaintiff came back to Canada and returned to live with the testator.
On November 7, 2008, the testator died of a heart attack, leaving a will, but made no provision for the plaintiff.
His estate was $600,000.
The Plaintiff brought an application for a share in the testator’s estate under the Wills Variation act.
Her Application was granted and she was entitled to $100,000 from the testator’s estate on the basis that the Testator owed a legal duty to plaintiff.
The Court found that the Plaintiff and the testator were living as spouses at time testator passed away, follwoing the BCCA case of Gostlin v Kergin (1986) 3 BCLR (2d) 264 that is the leadidng case in BC on the issue of common law marriages.
The Plaintiff would have had right to claim for maintenance and share of property had parties separated.
The matter would have been examined on the basis that there was a valid legal obligation to consider.
The Court followed the two chestnuts of Tataryn and Clucas, as follows:
The governing authority with respect to such applications is found in the decision of the Supreme Court of Canada in Tataryn v. Tataryn Estate, [1994] 2 S.C.R. 807. There the Court provided comprehensive direction with respect to the approach to be taken to the application of the Act. A succinct statement of the general principles that will ground the application is set out in the final submissions of the defendants:
a. The Wills Variation Act is an attempt to balance the protection of the interests of
children and spouses of the testator on the one hand with testamentary autonomy on the
other, (pages 11-12)
b. Need, although a factor in this balance, is not a requirement for Wills Variation
relief, (page 16, 2nd para)
c. A Wills Variation analysis requires a determination, firstly of whether there is a
“legal duty” which the testator has towards his wife or children. After assessment of the
legal duties, the court will review the “moral duties” of the testator towards his wife or
children, (pages 18-21)
d. If the testator chose an option within the range of what is “adequate, just and
equitable”, the Will will not be disturbed. It will be interfered with only in so far as the
statute requires, (page 21)
[80] A further very helpful discussion of the issue, including recognition of other relevant
authorities, is found in the decision of Satanove J. in Clucas v. Clucas Estate (1999), 25 E.T.R.
(2d)175(B.C.S.C):
[12] Many cases have been decided under the Wills Variation Act. The considerations governing the court’s decisions have evolved over time and there is a fairly comprehensive set of competing principles to which effect must be given. I have endeavoured to summarize these as follows:
The main aim of the Act is the adequate, just and equitable provision for the spouses and children of testators. (Tataryn v. Tataryn Estate, [1994] 2 S.C.R. 807)
The other interest protected by the Act is testamentary autonomy. In the absence of other evidence a Will should be seen as reflecting the means chosen by the testator to meet his legitimate concerns and provide for an ordered administration and distribution of his estate in the best interests of the persons and institutions closest to him. It is the exercise by the testator of his freedom to dispose of his property and is to be interfered with not lightly but only insofar as the statute requires. {Tataryn, supra)
The test of what is “adequate and proper maintenance and support” as referred to in s. 2 of the Act is an objective test. The fact that the testator was of the view that he or she adequately and properly provided for the disinherited beneficiary is not relevant if an objective analysis indicates that the testator was not acting in accordance with society’s reasonable expectations of what a judicious parent would do in the circumstance by reference to contemporary community standards Walker v. McDermott, [1931] S.C.R. 94; Price v. Lypchuk Estate (1987), 11 B.C.LR. (2d) 371 (C.A.); Dalzielv. Bradford etal. (1985), 62 B.C.LR. 215 (B.C.S.C.))
The words “adequate” and “proper” as used in s. 2 can mean two different things depending on the size of the estate. A small gift may be adequate, but not proper if the estate is large. {Price v. Lypchuk Estate, supra)
Firstly, the court must consider any legal obligations of the testatrix to her spouse or children and secondly, the moral obligation to her spouse or children. (Tataryn, supta)
The moral claim of independent adult children is more tenuous than the moral claim of spouses or dependent adult children. But if the size of the estate permits, and in the absence of circumstances negating the existence of such an obligation, some provision for adult independent children should be made. (Tataryn, supra)
Examples of circumstances which bring forth a moral duty on the part of a testator to recognize in his Will the claims of adult children are: a disability on the part of an adult child; an assured expectation on the part of an adult child, or an implied expectation on the part of an adult child, arising from the abundance of the estate or from the adult child’s treatment during the testator’s life time; the present financial circumstances of the child; the probable future difficulties of the child; the size of the estate and other legitimate claims. (Dalziel v. Bradford, supra and Price v. Lypchuk, supra)
Circumstances that will negate the moral obligation of a testatrix are “valid and rational” reasons for disinheritance. To constitute “valid and rational” reasons justifying disinheritance, the reason must be based on true facts and the reason must be logically connected to the act of disinheritance. (Bell v. Roy Estate (1993), 75 B.C.L.R. (2d) 213 (B.C.C.A.); Comeau v. Mawer Estate, [1999] B.CJ. 26 (B.C.S.C); and Kelly v. Ba/cer(1996), 15 E.T.R. (2d) 219 (B.C.C.A.))
Although a needs/maintenance test is no longer the sole factor governing such claims, a consideration of needs is still relevant. (Newstead v. Newstead ^996), 11 E.T.R. (2d) 236 (B.C.S.C.))
[81] The proper approach to the determination of the adequacy of the provisions made by the Testator was explained in Tataryn, at 820-821:
If the phrase “adequate, just and equitable” is viewed in light of current societal norms, much of the uncertainty disappears. Furthermore, two sorts of norms are available and both must be addressed. The first are the obligations which the law would impose on a person during his or her life were the question of provision for the claimant to arise. These might be described as legal obligations. The second type of norms are found in society’s reasonable expectations of what a judicious person would do in the circumstances, by reference to contemporary community standards. These might be called moral obligations, following the language traditionally used by the courts. Together, these two norms provide a guide to what is “adequate, just and equitable” in the circumstances of the case.
At date of death, a number of monies were in joint accounts bearing names of deceased,daughter L and granddaughter R
L took more interest in deceased than did daughter M and cared for her during last years of her life
The deceased and M were not estranged , while the relationship between L and M ( the sisters) was distant.
M was happily married and financially secure, while L was not
M as administratrix of estate brought action for monies in joint accounts to accrue to deceased’s estate.
The Court allowed the action as monies held in joint accounts were held on resulting trust for deceased’s estate, and there was a presumption of undue influence that was not rebutted.
L was unable to establish that the joint accounts were gift from deceased.
A Presumption of undue influence arose because L had opportunity to influence deceased .
The deceased was elderly with physical disabilities and depression, and lived in L’s home .
The presumption of undue influence was not rebutted .
Historically, there was equality of treatment by deceased and her husband towards daughters .
L’s ill will toward M may have influenced deceased’s feelings toward M.
L was involved with all of deceased’s investment transactions.the deceased did not sign many documents relating to joint accounts.
Without evidence that deceased was independently advised of these transactions, it was not assumed that deceased intended that one daughter was to be disinherited by them .
The Courts’ analysis is as follows. Besides the two Supreme Court of Canada cases, they also cited an American decision, which is quite rare in Canadian law.
The law regarding the use of a joint account as a method of devising property upon a donor’s death has recently received the attention of the Supreme Court of Canada in the case of Pecore v. Pecore, 2007 SCC 17 (S.C.C.), and Saylor v. Madsen Estate, 2007 SCC 18 (S.C.C.). Essentially, the basic principles are that where the other joint holder is an adult child of the person who is providing the monies, the opening of the account is to be characterized as a gift made at the time that the monies are placed into the account. Since they are a gift, prima facie, the monies are deemed to be the subject of a resulting trust back to the donor unless the donee can demonstrate on a balance of probabilities that the donor intended the monies to be a gift. It essentially boils down to a question of the donor’s intent and whether the donee has overcome the onus of proof. The proof of intent would need to include the existence of a desire on the part of the donor that the monies are to accrue to the donee upon the donor’s death, rather than simply a desire that the donee only administer the funds during the donor’s life.
” 29 There is another presumption that may enter into the mix in this case. That is the presumption which is applicable to gifts made in circumstances where the donee has the opportunity to unduly influence the mind of the donor. This presumption was set out in the judgment of Wilson J. in the case of Goodman Estate v. Geffen, [1991] 2 S.C.R. 353, [1991] S.C.J. No. 53 (S.C.C.). In that case, Wilson J. outlined the need to examine first the relationship that existed between the donor and the donee. If that relationship allowed for an opportunity on the part of the donee to influence the donor, then a presumption of undue influence arises. As to the degree of influence, Wilson J. said, at para. 40:
It seems to me rather that when one speaks of “influence” one is really referring to the ability of one person to dominate the will of another, whether through manipulation, coercion, or outright but subtle abuse of power.
30 Wilson J., further went on to say:
45 Once the plaintiff has established that the circumstances are such as to trigger the application of the presumption, i.e., that apart from the details of the particular impugned transaction the nature of the relationship between the plaintiff and defendant was such that the potential for influence existed, the onus moves to the defendant to rebut it. As Lord Evershed M.R. stated in Zamet v. Hyman, supra, at p. 938, the plaintiff must be shown to have entered into the transaction as a result of his own “full, free and informed thought”. Substantively, this may entail a showing that no actual influence was deployed in the particular transaction, that the plaintiff had independent advice, and so on. Additionally, I agree with those authors who suggest that the magnitude of the disadvantage or benefit is cogent evidence going to the issue of whether influence was exercised.
31 The reasoning for such a presumption is to ensure that people in dependent circumstances are not taken advantage of by those upon whom they are dependent. Not every case of an elderly person making a gift to an adult child will occur in circumstances of dependency. However, where such circumstances of dependency do occur, placing the onus upon a donee is the law’s way of protecting against unfair transactions.”
In the law of wills and trusts, precatory words have been defined as words of wish, hope, desire or entreaty accompanying a gift, that the done will dispose of property in some particular way, which may show that a trust was intended.” [At para. 25.] Ladd v. Ladd (2002), 47 E.T.R. (2d) 251, 2002 CarswellOnt 3608 (Ont. S.C.J.).
There are many case examples where such words as “wish, desire, hope, ” are found to be precatory and thus legally non binding.
These words of expression only can be juxtaposed against legally enforceable words such as “shall or must” and other mandatory words.
Rudaczyk Estate v. Ukrainian Evangelical Baptist Assn. of Eastern Canada (1989), 1989 CarswellOnt 534, 69 O.R. (2d) 613, 34 E.T.R. 231, Watt J. (Ont. H.C.) is a good example of this principle.
By her will dated September 28, 1981, the testatrix gave the residue of her estate to her trustees on trust to “pay or transfer” it to the Ukrainian Evangelical Baptist Association of Eastern Canada “for its own use absolutely”.
The will also gave to the trustees the various powers set out in a “Schedule Of Trustee’s Powers” which was initialed, attached to and expressly made part of the will.
By a “Memorandum To Trustee” which was signed by the testatrix in the presence of the same two witnesses as the witnesses to the will and which was dated September 28, 1981 the testatrix stated the following:
IT IS MY WISH that you set aside one-quarter of the residue of my estate for the benefit of my niece, [M.K. in the Ukraine] … and use this sum for the purchase and mailing of food, clothing, and other articles as my said niece, may request and you in your absolute discretion shall think fit.
The “Memorandum” was not referred to in the will. ( underlining added for emphasis)
The testatrix died in 1987 and letters probate were issued to the executors of her estate including both the will and the “Memorandum”.
The executors sought the opinion, advice or direction of the Court as to whether the memorandum was legally binding on the trustees or was merely precatory.
The preliminary issue arose as to the admissibility of the affidavit evidence of two persons which evidence related to the making of the will and the “Memorandum”.
Held:
(1) The affidavit evidence relating to the making of the will and memorandum was not admissible since it fell within the general exclusionary rule forbidding the introduction of direct extrinsic evidence of a testator’s actual intention and there was nothing which took the affidavit evidence out of the general rule.
(2) Although the “Memorandum” was executed in accordance with the requirements for making a will, it was to take effect after the testatrix’s death, and contained provisions relating to the disposition of the deceased’s property, its permissive language (particularly when contrasted with the imperative terms used in the will) and its existence as a separate document from the will indicated that it was merely precatory and not legally binding on the trustees
Todays case discussion is Hossay v Newman 1998 BCJ 3289
The plaintiff was adult son of the testator.
The Testator placed his major assets in joint tenancy with one of defendants shortly before his death with result that assets passed to that defendant by operation of law and did not form part of testator’s estate .
The son sued to set aside the Joint tenancies on the basis they were Fraudulent conveyances meant to defeat his claim as a creditor under the Wills Variation act.
The court dismissed the claim.
Section 1 of Fraudulent Conveyance Act does not apply to claims that arise solely on death of debtor/testator but rather contemplates situation where the claimant had some legal or equitable claim against debtor during debtor’s life.
Where claim arises solely on death under Wills Variation Act, claimant does not come within “creditors or others” within meaning of s. 1 of Fraudulent Conveyance Act.
As the plaintiff’s claim under Wills Variation Act arose solely on testator’s death, s. 1 of Fraudulent Conveyance Act did not apply to the inter vivos transfer by testator to the defendants.
If there is no legal or equitable claim which pre-exists the death of the testator, then the claim is solely one arising on death under the Wills Variation Act. Without any prior foundation, the claimant does not have the status of creditor or others within the meaning of s. 1 of the Fraudulent Conveyance Act.
The law relating to ademption applies when a particular item in a will is described with such specificity that it is clearly distinguished from other property owned by the deceased. If that specific property is not found among the testator’s assets after death, the gift is said to have adeemed-the gift fails and the technical term for the failure of the gift in such circumstances is ademption. The gift is said to have adeemed.
The rule applies whether the testator ever really did own the property or not .
For example testators often believe that they are the owners of property and after death, it is learned that the property was actually in another name such as a corporate entity or in joint tenancy.
The other common example that disinherited.com has witnessed is simply caused by poor draftsmanship in a will.
The will often specifies a specific civic address to be left to a beneficiary, when upon death it is learned that the property had been sold during the lifetime of the testator, who instead died owning another parcel of property with a different civic address.
(The proper wills drafting should have been instead something like “any residence that I own at the time of my death I hereby bequeath to ?”
In both situations the gift of the property will have adeemed.
Whether or not a gift has actually adeemed can in certain circumstances, be very difficult to determine.
Here are two examples of such litigation-there are many:
RE DEARDEN ESTATE; SHOEMAKER et al. v. PITTMAN et al.
By his will, made in 1970, the testator gave his dry-cleaning and laundromat business and the land where it was carried on to his nephew, MSM, and he gave the residue of his estate to his sisters and brother.
In February 1986, the testator entered into a contract to sell the business along with the land. The completion date for the contract was August 30, 1986. The testator died in June 1986. The contract, which was never in fact completed, was subject to certain conditions. In particular, the vendor was to subdivide the property by August 1, 1986; all structures on the land were not to encroach on any adjoining property; and the purchaser had a right to rescind if the financial position of the business was worse than that disclosed in financial statements provided by the testator. These conditions were never satisfied since subdivision had not occurred as of the date of the deceased’s death or as of the completion date; the building in question did encroach on land owned by the municipality and an agreement to resolve this encroachment was never made with that municipality; and the financial statements provided by the testator were in fact inaccurate, showing grossly inflated amounts for income.
The executors of the testator’s estate applied for the directions of the Court.
The Court held that there was no ademption-the he specific gift of the dry-cleaning and laundromat business, and the land on which it was carried on, was not adeemed by the contract of sale made by the deceased.
The doctrine of conversion applies only to a contract that is enforceable by and against the testator.
The contract made by the testator was not in fact enforceable by or against him since it was subject to two true conditions precedent (the conditions relating to zoning and encroachment) that were never satisfied. In addition, the contract was subject to the condition relating to financial statements which was not satisfied and which, not having been waived by the purchaser, rendered the contract unenforceable against the purchaser.
The testator’s will directed his trustee to pay M “the proceeds of a Term Deposit of $28,000.00 principal plus interest, … said Term Deposit having been made on or about November 10th, 1973.” At the time he executed his will, the testator had a term deposit of $28,000 at his bank. The testator subsequently cashed his term deposit and deposited the proceeds in his bank account. Thereafter the testator periodically purchased new term deposits, including a term deposit of $40,000, with the proceeds of the original and subsequent term deposits. During the currency of the $40,000 term deposit, the testator executed a codicil which in effect altered the terms of the original legacy so as to read:
To deliver and pay my friend, [M], … the proceeds of a Term Deposit of $40,000, … said Term Deposit having been made on or about November 10th, 1973, or at any time thereafter. …
The following year, the term deposit for $40,000 matured and its proceeds were deposited in the testator’s account. Subsequently, using the term deposit proceeds, the testator purchased a further term deposit for $36,000 and cashed it for $36,258.90. The testator supplemented the $36,258.90 with personal funds and purchased 37 one-thousand-dollar bills, which he deposited in his safety deposit box. At the testator’s death these bills were found in his safety deposit box along with a handwritten note which indicated that in the event of the testator’s death M was to get the contents of the box as a bequest.
At trial, the trial Judge found that M was entitled as a legatee, under the testator’s will, to $36,000.
On appeal, held, the trial Judge’s order was varied to include the interest received from the last term deposit, with the result that M was entitled to be paid $36,258.90 out of the $37,000 found in the safety deposit box.
No ademption.
The legacy to M would have been lost if:
(i) the proceeds of the term deposit could not have been traced, or
(ii) the testator in cashing the deposits had clearly appropriated the proceeds to himself, in which case they would have been adeemed.
Though the note found in the testator’s safety deposit box was not itself given testamentary effect, it was used to trace and identify the proceeds given by the will and codicil.
Please note that since the date of this original blog, the curative provisions of s 58 of WESA may have altered the law relating to the topic of holograph wills.
Holograph wills are ones that is entirely written and signed by the testator, but does not have the witness attestation that is required in British Columbia in order to make a will valid. ( Two witnesses and the testator sign the will, all in the presence of each other, is required in British Columbia)
Many non lawyers have heard the story of the Alberta farmer pinned under his tractor and dying, who wrote on the dust of the tractor’s fender “everything to mom”.
The holograph will/fender was not dated, but the fender was admitted into court as the last valid holograph will of the deceased, and everything went to mom..
That would not be a valid will in British Columbia for a few reasons, but most primarily, the absence of the two witnesses.
The holograph will must still have the necessary animus testandi, meaning the deliberate intention to dispose of property after death.
There cannot be any question of this testamentary intention as there is no requirement that the holograph will identify itself as a will.
There are examples where letters have been held sufficient to be admitted to probate as holograph wills.
The decision Re Neilson Estate (1989) 96 NBR (2d) 2 involved a deceased who had delivered three pages of handwritten instructions to her lawyer, and then signed the last page with her first name, and put the pages in an envelope with her full name on the outside.
The court admitted these instructions as a valid holograph will .
disinherited.com is strongly supportive of the existing law in British Columbia requiring two witnesses to all be present, and both watch the testator sign his or her name, and then the testator watching the witnesses attest their names, all at the same time.
There is already far too much abuse in the wills and estates arena, and the absence of two witnesses can only lead to further wills and financial abuse, particularly of the elderly.
