Common Law Spouse of 21 Years Awarded %70 Estate

seventy

 

The plaintiff and the deceased lived together in a common-law marriage like relationship for 21 years in a house owned by Rose. At the time of cohabitation, Rose was divorced and the deceased was separated. Rose had one child from a previous relationship.

 

At the time of the deceased death, Rose was retired and owned a house worth $1,240,000.

 

The deceased and his mother jointly owned a condominium and term deposits of some $69,000.

 

The defendants were the deceased sister and brother, nieces and nephews.

 

In generate 2007, one month prior to his death, Rose and the deceased made handwritten changes to the deceased will and had roses some type of the new will. The new will appointed rose as executor, made special bequests to the church and cancer foundation and gave the residue of the estate to Rose.

 

The new will was signed but not witnessed.

 

The new will had markings Rose said were made by him after the deceased died and not by the deceased to indicate she did not agree with parts of the will.

 

Rose asked a Notary Public to transfer the bank accounts into joint names.

 

The Notary Public attended the hospital to speak with the deceased, but did not prepare a new will as she said there was no spontaneous response from the deceased to requests to prepare a new will.

 

Rose brought court action to vary the will as he said the original will did not make adequate provision for his maintenance and support.

 

The action was allowed on the basis of the deceased had neither illegal nor moral obligation to the defendants, where she had both to Rose.

 

Rose’s net worth in relation to the deceased was not a factor. The variation of the will was adequate just and equitable to Rose and entirely appropriate in all the circumstances.

 

The court ordered that Rose receive 70% of the net value of the estate with the residue to be divided between the church and the other defendants.

 

THE LAW

The basis for bringing a claim to vary a will, is found in s. 2 of the Wills Variation Act, R.S.B.C. 1996, c. 490 (the “Act”):

2. Despite any law or statute to the contrary, if a testator dies leaving a will that does not, in the court’s opinion, make adequate provision for the proper maintenance and support of the testator’s spouse or children, the court may, in its discretion, in an action by or on behalf of the spouse or children, order that the provision that it thinks adequate, just and equitable in the circumstances be made out of the testator’s estate for the spouse or children.

[37] The plaintiff comes within the definition of “spouse” found in the Act:

“Spouse” means a person who

(a) is married to another person, or

(b) is living and cohabitating with another person in a marriage-like relationship, including a marriage-like relationship between persons of the same gender, and has lived and cohabitated in that relationship for a period of at least 2 years.

[38] Counsel for the parties are on common ground that the test for whether a testator has made adequate provision for the maintenance and support of a spouse is the decision of the Supreme Court of Canada in Tataryn v. Tataryn Estate, [1994] 2 S.C.R. 807. In Tataryn, the Court found that two sets of societal norms must be addressed:

(1) legal obligations which the law would impose upon the testator during his or her lifetime; and

(2) moral obligations, which are society’s reasonable expectations of what a judicious person would do in the circumstances, by reference to contemporary community standards.

[39] At p. 821 of her reasons, McLachlin J. (as she then was) explained that together these societal norms provide a guide to what is “adequate, just and equitable” in the circumstances of the case.

[40] The Court also recognized the importance of protecting testamentary autonomy. At pp. 823-4 McLachlin J. held, as follows:

I add this. In many cases, there will be a number of ways of dividing the assets which are adequate, just and equitable. In other words, there will be a wide range of options, any of which might be considered appropriate in the circumstances. Provided that the testator has chosen an option within this range, the will should not be disturbed. Only where the testator has chosen an option which falls below his or her obligations as defined by reference to legal and moral norms, should the court make an order which achieves the justice the testator failed to achieve. 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 in so far as the statute requires.

[41] However, counsel are not on common ground about whether the recent decision in Picketts v. Hall (Estate), 2009 BCCA 329, 95 B.C.L.R. (4th) 83, has changed the law, or whether the outcome applies to the facts in the case at bar.

[42] In Picketts,the Court squarely addressed the issue of the legal and moral duty owed by a testator to a common law spouse, and whether different considerations apply to a common law spouse than to a married spouse in an application to vary a will.

[43] In that case, Mr. Hall and Ms. Picketts had lived together for 21 years as though they were a married couple. On Mr. Hall’s death, Ms. Picketts was 75 years of age. He left two adult sons, and an estate worth $18,000,000.

[44] Under his will, Mr. Hall left Ms. Picketts the condominium they had been living in, and $2,000 per month for her life. The Court awarded Ms. Picketts $5,500,000, which was an amount close to one-third of the value of the estate, the amount she would have received under the provisions of the Estate Administration Act, R.S.B.C., 1996, c. 122 (the “EAA”).

[45] Low J.A. dealt with Mr. Hall’s moral obligation to Ms. Picketts and the application of the EAA, as follows:

[54] Although McLachlin J. in Tataryn did not discuss the Estate Administration Act, R.S.B.C. 1996, c. 122, or its applicable predecessor, under the topic of legal obligations, I think that statute bears mentioning at this point. The provisions in the statute as to intestacy succession create a default succession in law if a person should die without a will. Section 85 states that, on an intestacy in which there is a surviving spouse and a surviving child or surviving children, the spouse is entitled to the first $65,000 of the estate and half of the residue if there is one child surviving, and one-third of the estate if there is more than one child surviving.

[55] In the unlikely event that Mr. Hall had died intestate, Ms. Picketts would have received one-third of the entire estate. This is because the definition of “common law spouse” in the Estate Administration Act was amended by the Definition of Spouse Amendment Act, S.B.C. 1999, c. 29, to mean, inter alia, “a person who has lived and cohabited with another person in a marriage-like relationship, including a marriage-like relationship between two persons of the same gender, for a period of at least 2 years immediately before the other person’s death”. This is essentially the same definition as the definition of “spouse” in the Wills Variation Act. The two definitions became law on the same date.

[56] Although the intestacy provisions of the Estate Administration Act do not directly affect the legal considerations under Tataryn, it is significant that the Legislature chose to amend both statutes at the same time. This can be seen as a dovetailing of the two statutes to reflect the social norms of the day and, to repeat the quote from Tataryn at p. 822, to “reflect a clear and unequivocal social expectation, expressed through society’s elected representatives…”

Who Owns Your Digital Data After Death

Reprinted from the Economist July 18,2013

The Economist explains

Who owns your digital data after death ?

AFTER we die, our bodies are reduced to dust or ash, through burial or cremation. The fate of the digital corpuses we leave behind is rather more complicated. Before the advent of internet-hosted storage and services, your digital remains would have been accessible only to those with physical access to your computers, and only then if you had not applied encryption or password protection. But these days many people leave traces of their lives spread across the internet. Facebook knows who we love and hate, Google knows what we are interested in, Amazon knows what we buy, and so on. Specialist services may even store information about your genetic makeup (23andme) or archives of your files (Dropbox, CrashPlan, and many others). Who owns your data when you’re dead?

No one, not even a probate lawyer, will tell you that the process of transferring property by writing a will—or dealing with the absence of one—is a simple matter. But when it comes to financial assets, physical goods or property, thousands of years of tradition and many hundreds of years of legal precedent provide a basis on which to proceed in even the most esoteric cases. Digital assets that are stored on shared servers in the cloud, by contrast, are so new that legal systems have not yet caught up. Five American states have passed legislation to provide executors and other parties with a legal basis on which to assert authority over digital assets, and others are considering similar rules, but these laws vary widely in what they cover (the oldest of them covers only e-mail). There are no federal laws. The same is true in other countries. To complicate matters further, internet firms may be based in different countries from their users and may store data in servers in many countries, making it unclear whose laws would apply.

A paper by Maria Perrone in the journal CommLaw Conspectus explains how internet firms and digital service-providers sit in final judgment when it comes to deciding the fate of data belonging to the dead. Some firms cite an American law from 1986, the Stored Communications Act, as clearly prohibiting many forms of data handover to heirs or estates, even with verified written instructions asking for data to be released. The law provides no exemptions and involves hefty prison sentences for violators. But every company seems to have its own set of rules, procedures and terms of service. Some require a legal executor to make a request, while others honour requests from anyone who can prove a family connection or even a link to an online obituary. Facebook limits valid parties to requesting either that an account be removed or be turned into a memorial site. Twitter says bluntly that it can deactivate an account on presentation of several bits of information, but it is “unable to provide account access to anyone regardless of his or her relationship to the deceased.” Some firms delete accounts after inactivity; others refuse to allow renewals to keep the data alive; others won’t allow any changes, and leave a user’s data frozen in time, to the distress of those left behind. Several companies, such as Cirrus Legacy and LegacyLocker, offer digital safes for passwords and documents, releasing them only to authorised parties in the event of the owner’s death. But such firms state clearly that their contract is not legally binding in two regards: a judge or executor might compel them to release information to people other than those specific by the owner, and the passwords may be useless if they relate to an account that has been separately deactivated or shut down.

All this can be maddening for those dealing with grief. But there are signs of progress. In April, Google released the Inactive Account Manager, which in effect allows users of its service to set up a digital will. When enabled, it activates a dead-man’s switch, and if the account is not used for a specified period (between three and 18 months) an e-mail can be sent to a trusted contact, and there is an option to delete the account automatically. The trusted contact can then follow a procedure to gain access to the account. Other internet giants may follow suit and offer similar features. More broadly, America’s Uniform Law Commission, a non-partisan group that creates model legislation that is then adopted unchanged by many American states, has a “Fiduciary Access to Digital Assets” committee working on amendments to existing ULC laws that would give executors many of the same powers over digital assets that they have over financial and physical ones, while absolving service providers of any liability. These adjustments could be incorporated into some states’ laws as soon as 2015, though some federal fiddles may be required as well. In her paper, Ms Perrone notes that such uniformity would mean that “people would no longer have to rely on companies’ varying terms of use to determine how to manage digital assets.” When dealing with death, a little certainty can be a great comfort.

“Marriage Like Relationship” Upheld

The criteria for a marriage like relationship was upheld in the Duga case.marriage like relationship

The courts have been grappling with the often difficult to determine issue of what is a marriage like relationship for several years. Many of the earlier decisions were difficult to reconcile, especially when it became clear that a goodly number of parties have rather untraditional manners of living in a marriage like relationship.

The trial Judge found the following facts:

“The evidence of their continuing emotional commitment to each other [after they began living in separate houses in November 2003], their continuing mutual expectations of fidelity, their continuing presentation to friends and family as a couple, and their joint vacations all militate in favour of finding that the parties intended to continue their marriage-like relationship.

Between the fall of 2003 and September 2006, Mr. Dutra continued to provide economic support to Ms. Roach. He gave her cash from time to time and paid her telephone and hydro bills for the Page Two property. Throughout their relationship, Mr. Dutra permitted Ms. Roach to use his bank card to make purchases for herself, for her own children, and to purchase groceries and household items.

Before and after the plaintiff moved to the Page Two property, Ms. Roach and Mr. Dutra provided care to each other’s children. Mr. Dutra developed a close relationship with the plaintiff’s daughter, and became a father figure to her. Mr. Dutra’s children went camping with the plaintiff and her children.

Until September 2006, when they separated, the plaintiff and the defendant continued their marriage-like relationship. They saw themselves, and were seen by others, to be a couple who were engaged to be married. Mr. Dutra willingly provided financial support for Ms. Roach and she, with his consent, continued to be economically dependent upon him during the time they maintained separate residences. Their mutual expectations of fidelity continued after the acquisition of the Page Two property. They continued to share their lives, and intended to live in a marriage-like relationship. The plaintiff and the defendant were “spouses” within the meaning of subsection (b) of the definition of that term in s. C(1) of the FRA until they separated in mid-September 2006. “

The appeal court upheld the trial judge’s finding that the parties were in fact in a marriage like relationship for three years.

The Law:

Section 1(1) provides, in part:

1.(1) In this Act:

“spouse” means a person who

(a) …

(b) … lived with another person in a marriage-like relationship for a period of at least 2 years if the application under this Act is made within one year after they ceased to live together, and, for the purposes of this Act, the marriage-like relationship may be between persons of the same gender,

[12] In addressing the issue of whether the parties were spouses within the meaning of s. 1(1), the trial judge engaged in a detailed analysis of all aspects of the parties’ relationship. He canvassed numerous authorities, including Gostlin v. Kergin (1986), 1 R.F.L. (3d) 448, 3 B.C.L.R. (2d) 264 (C.A.); Takacs v. Gallo (1998), 157 D.L.R. (4th) 623, 48 B.C.L.R. (3d) 265 (C.A.), leave to appeal dismissed, [1998] S.C.C.A. No. 238; and Molodowich v. Penttinen (1980), 17 R.F.L. (2d) 376 (Ont. Dist. Ct.). He also considered authorities which dealt with situations in which the parties were found to have lived in a marriage-like relationship despite having lived separately for extended periods, including McColl v. Scott, 2001 BCSC 1109, and Roch v. Payne, [1999] B.C.J. No. 2739 (S.C.).

[13] As earlier stated, Mr. Dutra does not now dispute that he and Ms. Roach lived together in a marriage-like relationship for approximately three years from December 2000 to November 2003. The question is whether the nature of their relationship changed in November 2003 when the parties decided to live in separate residences, albeit five minutes apart. Mr. Dutra submits that when this move occurred, the relationship ceased being marriage-like. In the alternative, he submits that, even if the parties’ relationship could in other respects be regarded as marriage-like, Ms. Roach no longer qualified as a spouse within the meaning of s. 1(1) since the parties were no longer living together. In short, Mr. Dutra submits that, in order to qualify as a “spouse” within the meaning of s. 1(1), not only does the parties’ relationship have to be marriage-like, but the parties also have to be living together, or, at the very least, intending to live together.

[14] It is clear from the trial judge’s reasons that he did not accept that the mere fact that the parties began to live in separate residences in these circumstances changed the fundamental nature of their relationship from marriage-like to non-marriage-like. In that regard, he referred to Ms. Roach’s evidence that the intention of the parties in making this change was to strengthen their relationship, not to end it, or transform it into something fundamentally different than it was before.

[15] The trial judge set out many, but not all, of the factors upon which he relied in concluding that the parties were spouses after November 2003 at paras. 91-94 of his decision:

… The evidence of their continuing emotional commitment to each other [after they began living in separate houses in November 2003], their continuing mutual expectations of fidelity, their continuing presentation to friends and family as a couple, and their joint vacations all militate in favour of finding that the parties intended to continue their marriage-like relationship.

Between the fall of 2003 and September 2006, Mr. Dutra continued to provide economic support to Ms. Roach. He gave her cash from time to time and paid her telephone and hydro bills for the Page Two property. Throughout their relationship, Mr. Dutra permitted Ms. Roach to use his bank card to make purchases for herself, for her own children, and to purchase groceries and household items.

Before and after the plaintiff moved to the Page Two property, Ms. Roach and Mr. Dutra provided care to each other’s children. Mr. Dutra developed a close relationship with the plaintiff’s daughter, and became a father figure to her. Mr. Dutra’s children went camping with the plaintiff and her children.

Until September 2006, when they separated, the plaintiff and the defendant continued their marriage-like relationship. They saw themselves, and were seen by others, to be a couple who were engaged to be married. Mr. Dutra willingly provided financial support for Ms. Roach and she, with his consent, continued to be economically dependent upon him during the time they maintained separate residences. Their mutual expectations of fidelity continued after the acquisition of the Page Two property. They continued to share their lives, and intended to live in a marriage-like relationship. The plaintiff and the defendant were “spouses” within the meaning of subsection (b) of the definition of that term in s. 1(1) of the FRA until they separated in mid-September 2006.

[16] In my view, there is no basis for interfering with the trial judge’s conclusion that the parties were spouses within the meaning of s. 1(1) of the FRA ( Family Relations act). The question of whether parties are living in a marriage-like relationship is largely fact-driven and depends on the individual circumstances of each case. Here, I am satisfied that the trial judge properly applied the legal test set out in s. 1(1) of the FRAin relation to the unique facts before him. His findings of fact turned, in part, on findings of credibility. In that regard, the trial judge found that Mr. Dutra tended to minimize the extent of his commitment to the relationship. At para. 51 of his decision, the trial judge stated:

The defendant [Mr. Dutra] also asserted that the relationship only lasted for another three or four months after he gave Ms. Roach the two rings in the summer of 2004. I reject Mr. Dutra’s evidence on this point. I accept the testimony of the plaintiff that the parties continued their relationship after they purchased the Page Two property, and remained a couple, despite strains in the relationship from time to time, until September 2006. …

[17] I am not persuaded that the wording of s. 1(1) precludes a finding that these parties, who had been living in a marriage-like relationship for three years, cannot be found to be spouses within the meaning of that section simply because they began living in separate residences with a view to preserving their relationship. In adopting the trial judge’s conclusion in that respect, I agree with the following passage at paras. 18-19 of the reasons for judgment of Master Groves (as he then was) in McColl, where, in dealing with a similar argument, he stated:

… Clearly the words, “live together” must be read in the context of the entire section where it talks earlier about living with another person in a marriage-like relationship for a period of two years. To suggest that if parties are by reasons of, say, health, hospitalization, overseas attendance in the military or for general work purposes, as is the case here, temporarily separate that the “spousal definition clock”, for lack of a better term, then starts running, would result in numerous couples essentially ceasing to be spouses as a result of this temporary separation. The legislature in my view would have to make that intention clear.

If for all purposes mere physical separation ends a “marriage-like” relationship, clear wording to that effect would be required. The general purpose of the Family Relations Act is to recognize spouses who make a commitment to one another and to apportion support consequences of that commitment between them upon relationship breakdown. The legislation requires that they live in a marriage-like relationship of at least two years. To say that all marriage-like relationships involve continuous cohabitation, that a temporary interruption for health or work reasons in that continuous cohabitation ends a spousal relationship, is not in my view what the legislature intended.

[18] In that case, Master Groves found that the parties continued to view themselves as spouses and expected their relationship to continue as such despite their physical separation.

[19] In this case, however, Mr. Dutra says that there is no evidence that the parties separated with the intention of resuming cohabitation and that their choice to live in separate residences was not imposed by external circumstances such as illness or work-related demands.

[20] It is apparent, however, that the trial judge accepted that the parties decided to live in separate residences as a temporary measure to alleviate the tensions between Ms. Roach and Mr. Dutra’s teen-age daughter. It is implicit in his reasons that he accepted Ms. Roach’s evidence that the purpose of the move was to maintain the relationship, not to change its essential nature. In effect, it could be said that the parties continued to live together in a marriage-like relationship, but in two homes, rather than one. The trial judge found that they continued to relate to one another in much the same way as before; that is, as spouses.

[21] In effect, Mr. Dutra is asking this Court to retry the issue of whether the parties were spouses within the meaning of s. 1(1). In the absence of significant and identifiable error on the part of the trial judge, and I find none, there is no basis for doing so. There is no doubt that the facts of this case were unusual given the period that the parties lived under separate roofs before their relationship ended, but there were numerous indicia which supported the trial judge’s conclusion that they were, nonetheless, spouses within the meaning of s. 1(1) and that they regarded themselves as such until their relationship ended in September 2006. As Mr. Justice Frankel stated, in speaking for the Court in Austin v. Goerz, 2007 BCCA 586, at para. 58, “there is no checklist of characteristics that will invariably be found in all marriages.”

[22] Since I have concluded that the trial judge was correct in finding that the parties lived together in a marriage-like relationship within the meaning of s.1(1) of the FRA until September 2006, it follows that Ms. Roach brought her application for spousal support within the one year limitation period set forth in that section.

Charitable Gifts

Canadian tax laws are structured such that in the area of estate planning, donations if made to a registered charity, can give rise to tax credits that can be used to offset the income of the deceased.

Accordingly, if a deceased person leaves a charitable bequest in his or her will, then the tax department deems that the donation is made immediately on the deceased death in the year of the death, and that can be used in the immediately preceding year for taxation purposes.

Cash bequests are undoubtedly the most common form of charitable gift, however charities are more than willing to accept securities, real property, valuable art and other such assets.

 

It is of course extremely important to determine if the gift is in fact charitable or not.

From a tax perspective, only a gift to a registered charity or gift to another qualified donee gives rise to the tax benefits permitted by the income tax act.

 

Where charitable gift would otherwise fail, it possibly may be saved by way of the cy-pres doctrine where the court applies the gift only to charitable gifts of a similar nature. To be a registered charity, it must have as its exclusive purpose the pursuit of charitable ones and there are generally three types:

 

A charitable organization that actually carries out charitable act to the such as the Salvation Army;
2. A public foundation whose primary purpose is raising and dispersing funds to qualified domains, such as the United Way

 

A private foundation that does much the same as a public foundation but does not meet its requirements. Generally speaking charity must be public in nature and generally related to topics such as the relief of poverty, the advancement of education, the advancement of religion, and other purposes beneficial to the community.
Persons wishing to take advantage of estate planning such as charitable gifting should seek the services of a qualified estate solicitor. it is reported that 84% of Canadians aged 15 and older make regular charitable or nonprofit donations , usually to a variety of causes in which they believe personally, and for whom they feel compassion the most. in fact theResearch shows that only 13% of donors do so for income tax credits, whereas up to 94% of donors do it simply because it makes them feel better and they feel compassion for the recipients, and that they’re giving back to society.as was blogged last week, wherein it was reported that 50 Americans had contributed over $7 billion in charity in 2012, it would apit would appear that the bulk of charitable dollars comes from a very small six segment of the population . generally speaking the likelihood of giving tends to increase with age, increases with income, and is also associated with higher levels of education. women are more likely than men to make donations, whereas men are more likely to make larger average gifts . discussions with billionaires and their philanthropy indicates that their major motivation for giving was to give back to the community .

“Tenor of the Will”

Tenor of the willSometimes poorly drafted wills fail to expressly provide for the appointment of an executor.

The will however may direct a person to perform one or more duties that may be described as those of an executor, and accordingly the courts have developed the concept of an “executor according to the tenor of the will”, being a person who is not expressly named in the will as an executor, but who is directed to do those duties.

For example words such as “ to hold and administer all of my estate”, or “to carry out my wishes”, have been interpreted as amounting to the appointment of an executor according to the tenor of the will.

 

An executor can derive his or her office from a testamentary appointment only.

His or her appointment however may be either express or constructive. If no executor is expressly appointed in the will, yet the testator has re-recommended are committed the right and duties which pertain to any executor to one or more persons, and amounts to a constructive appointment and the person is referred to as an executor according to the tenor of the will.

 

 

In re McMillan 1925 CarswellSask 126, [1925] 3 W.W.R. 584

A will reading, “I bequeath all my estate to Mrs. Annie Stewart to be divided equally among Mrs. Stewart and Mrs. Stewart’s brothers and sister,” held not to constitute Mrs. Stewart an executrix according to the tenor of the will. Extrinsic evidence of the testatrix’s intention held inadmissible.

n In the Goods of Way [1901] P. 345, it was held that in each case it was “a question of construction of each particular document,” and in that particular case the word, “administer” appeared, and the petitioner was held to be the executor according to the tenor.

4 In In re Pryse, [1904] P. 301, 73 L.J.P. 84, the Court dealt largely with the question as to whether probate should be granted or letters of administration with the will annexed — a matter of practice. But in that case there was a direction to pay a debt, and one of the grounds put forward was that the applicant was the “universal heir,” and letters of administration with the will annexed were ordered to issue.

5 In In the Estate of MacKenzie [1909] P. 305, 26 T.L.R. 39, the headnote is:

In the absence of a direction to pay debts, the trustees were not executors according to the tenor.

6 In In the Goods of Lush (1887) 13 P.D. 20, 57 L.J.P. 23, directions to get in the estate of the testator and to distribute it in a certain manner after the payment of all funeral and other expenses, was held sufficient to constitute a trustee an executor according to the tenor.

7 In In the Goods of Jones, 2 Sw. & Tr. 155 (164 E.R. 952) the deceased left everything to his brothers in trust to be equally divided by him between himself and his surviving brothers. Held, not an executor according to the tenor. This case most resembles the one at bar.

8 In In the Goods of Wilkinson [1892] P. 227, A. and B. were appointed trustees of the will and testament, and the wish expressed that they should pay the funeral and other debts and it was held that they were thereby constituted executors according to the tenor.

9 In In the Goods of Adamson (1875) L.R. 3 P. & D. 253, the headnote reads:

In order to constitute one an executor according to the tenor of a will it must appear, on a reasonable construction thereof, that the testator intended that he should collect his assets, pay his debts and funeral expenses, and discharge the legacies contained in such will.

10 And in Halsbury, vol. 14, sec. 241, appears the following passage:

But where it cannot be gathered from the will that the person named as trustee is required to pay the debts of the testator, and generally to administer his estate, he is not entitled to probate.

In the case of In re Pamela Cook, 1902 P. 114 the plaintiff was appointed executor according to the tenor. In that case a person was designated to pay all the just debts. The judge describing that person as a trustee said:

“But I think that the more reasonable construction is that, inasmuch as under this will the debts which the trustee is directed to pay must of necessity be paid out of the estate, the effect of the will is to appoint the trustee executor according to the tenor. I therefore grant probate to him.”

Collapse of Gift: Saunders v Vautier

Termination of Trusts: Saunders v Vautier

The Rule of Saunders v Vautier

For various reasons parents often wish to delay any bequest to a child for many years, often to the point where the child would be a senior citizen before the child inherited. Very often these types of trusts provide that the child is maintained in a meagre sort of fashion with the income, and discretionary capital as the trustee in his or her absolute discretion considers necessary and advisable. If drafted correctly, these types of trusts can be upheld by the courts. However in a situation that recently came into our office, and is currently before the courts, disinherited.com is optimistic that the trust will be collapsed by reason of its failure to comply with the rule of Saunders v Vautier ( 1841) EWHC Ch J82. In our situation the deceased directed that the son’s share be held in trust until he attained the age of 65 years, and that he be paid the sum of $1000 per month until he attained the age of 65 years.

The trustee also had discretion to pay certain amounts of capital for education and advancement or benefit.. The important legal point was that the trust did not provide for a gift over to another beneficiary in the event that the offer said child failed to live to the age of 65 so that he could inherit out rightly. Furthermore, our client is over the age of majority and is legally mentally competent, and therefore according to the after said rule of law, our client is entitled to have the trust collapsed and be paid the entire inheritance right away.

The rule of Saunders v Vautier was briefly summarized by the Supreme Court of Canada in Buschau v. Rogers Communications Inc., 2006 SCC 28: 21 The common law rule of Saunders v Vautier can be concisely stated as allowing beneficiaries of a trust to depart from the settlor’s original intentions provided that they are of full legal capacity and are together entitled to all the rights of beneficial ownership in the trust property. More formally, the rule is stated as follows in UnderbillandHayton: Law of Trusts and Trustees (14th ed. 1987), at p. 628: If there is only one beneficiary, or if there are several (whether entitled concurrently or successively) and they are all of one mind, and he or they are not under any disability, the specific performance of the trust may be arrested, and the trust modified or extinguished by him or them without reference to the wishes of the settlor or trustees.

According to D.W.M. Waters, M.R. Gillen and L.D. Smith, eds., Waters Law of Trusts in Canada (3rd ed. 2005), at p. 1175, the rule was developed in the 19th century and originated as an implicit understanding of Chancery judges that the significance of property lay in the right of enjoyment. The idea was that, since the beneficiaries of a trust would eventually receive the property, they should decide how they intended to enjoy it. Waters et al., at 1177, set out three situations in which the rule of Saunders v. Vautier operates, the first of which is directly applicable to the Trust in this case: (1) A beneficiary who is adult, of sound mind, and entitled to the whole beneficial interest may require the trustees to transfer the trust property to him. For instance, to A $50,000 payable on his twenty-fifth birthday, the income to be payable to him annually until he attains that age.

In the first situation and the example given, A can call for the capital and any income withheld during minority on his coming of age, provided he is then of sound mind. As stated in Waters et al., at 117   There are two keys to a Saunders v. Vautier termination of the trust: first, that the beneficiary, or all the beneficiaries, when there is more than one, are fully capacitated, in the sense of being adult and of sound mind; second, that the person or persons seeking to terminate do indeed represent the full beneficial interests, actual and possible, in the trust property. Saunders v. Vautier has been applied in British Columbia to a trust set up by court order despite the Public Trustee’s argument that the objective of the structured settlement would be defeated if the beneficiary could determine the trust immediately on attaining the age of 19 years. As set out in Grieg v. National Trust Co. (1998), 20 E.T.R. (2d) 309 (B.C.S.C.):

The rule in Saunders v Vautier is founded on two principles,

The beneficiary is of full capacity.

The beneficiary has the full beneficial interest, both as to payments during the beneficiary’s lifetime and through the control of the reversionary interest. 8 Given both of these, there is no conflicting interest nor lack of capacity to a determination of the trust. In my view, the fact the trust was set up by court order gives it no special quality which would restrict the right to determine the trust in accordance with these principles. With the petitioner having attained majority, and having settled the reversionary interest in favour of her estate, she now has a right to determine the trust and receive the sum held on her behalf. Saunders v. Vautier was also applied in Frolek v. Frolek, [1986] B.C.J. No. 1869 (S.C.), at p. 7 (Q.L.), in a more difScult situation where the trust provided that the capital remaining in the trust fund on the death of the sole beneficiary of the trust would form part of the residue of her estate: I conclude on the authority of Re Johnston (supra), and Re Dawson (supra), and with the benefit of Professor Waters’ helpful discussion of the problem, that Winnifred is entitled to terminate the trust provision in her favour, and to call now for payment to her of the capital sum of $500,000.1 reach that conclusion because: no other person has any interest in the subject of the trust; the provision in Charlie’s will which makes any residue of the trust’s capital, part of the residue of Winnifred’s estate, gives her effective power to dispose of the remainder upon her death; and the trustee’s power to encroach on the capital for Winnifred’s benefit, and to treat her generously, makes it clear that the capital was to be used for her benefit during her life.

The Law of Equitable Set Off and Restitution

Restitution

The Law of Equitable Set Off and Restitution

Kessel Estate v Rikxoort 2012 BCSC 1270 involves a dispute arising from a complex financial transaction between the deceased and the defendants.

The parties had entered into a buy sell agreement which provided that the survivor of the parties would by the other shares in a relevant company. After the deceased sudden death, the deceased personal representatives brought action for damages arising from the buy sell agreement, alleging conversion of assets of a company, and sought a windup of the partnership.

The court allowed the remedy in part and reviewed various aspects of the law, including mistake of fact and set-off.

 

The following excerpt from the decision relates to the law of Equitable set off:

260 The Court of Appeal reviewed the law of set-off in Wilson v. Fotsch, 2010 BCCA 226(B.C. C.A.). It described law of equitable set off as being available provided that there is a relationship between the cross-obligations such that it would be unfair or inequitable to permit one to proceed without taking the opposing claim into account. The requirements for a claim of equitable set-off are as follows:

 

1. The party relying on a set-off must show some equitable ground for being protected against his adversary’s demands;

 

2. The equitable ground must go to the very root of the plaintiff’s claim before a set-off will be allowed;

 

3. A cross-claim must be so clearly connected with the demand of the plaintiff that it would be manifestly unjust to allow the plaintiff to enforce payment without taking into consideration the cross-claim;

 

4. The plaintiff’s claim and the cross-claim need not arise out of the same contract; and

 

5. Unliquidated claims are on the same footing as liquidated claims.

 

261 The textbook by S.M. Waddams, The Law of Damages, looseleaf (Toronto: Canada Law Book, 1991 at para 1.1770, says the following with respect to tortfeasors who use the proceeds of a conversion to pay down the plaintiff’s debts:

 

The preferable view, therefore, seems to be not to reduce recovery, on account of repayment of the debt, in any case in which the defendant could not, in an independent action, obtain restitution for the benefit conferred upon the plaintiff by repayment of the debt.

 

262 Mr. Justice Stinson of the Ontario Superior Court of Justice commented on the court’s unwillingness to allow recovery of benefits conferred by “officiousness” in J.B.C. Consulting Inc. v. Gray(2000), 47 O.R. (3d) 212(Ont. S.C.J.) at para. 19, as follows:

 

[19] Historically, juridical justification for retention of the benefit has been described as existing where a plaintiff acted officiously, or where the defendant has been the unwilling or unwitting recipient of benefits conferred by the plaintiff, that is, where the defendant’s affairs have been interfered with via the plaintiff’s payment without the defendant’s awareness or despite the defendant’s objections. The courts have allowed recovery where the plaintiff has conferred the benefit on the defendant as the result of a legal or practical compulsion, in the absence of officiousness.

 

263 Stinson J. allowed the set-off in J.B.C. Consulting Inc.. Although there was no compulsion on the plaintiff to confer the benefit, the defendant knew of the benefit he would receive before it was given. Although the defendant did not acquiesce, neither did he object.

 

264 Stinson J. also adopted the following passage from J.D. McCamus and P.D. Maddaugh, The Law of Restitution in Canada (Aurora: Canada Law Book, 1990) at 739-740, as an accurate statement of the modern approach to restitution:

 

In sum, the few unfortunate constraints that have developed in connection with the principle enunciated by Cockburn C.J. in Moule v. Garrett must perforce lose much of their relevance in light of the modern theory of the law of restitution based upon the doctrine of preventing an unjust enrichment. Thus, it should not matter that one party has discharged another’s liability in circumstances of practical, as opposed to strictly legal, compulsion. Nor should it be of concern if the liability of each of the parties should arise from different sources. Indeed, in cases of practical compulsion or economic duress, it is meaningless to speak of any liability whatsoever on the part of the plaintiff to have satisfied the obligation owed by the defendant. Discharge of another’s liability — although conferred in an indirect fashion — is, after all, simply one form of enrichment. So long as that benefit is bestowed by a plaintiff in circumstances such that the defendant cannot, in all good conscience, retain it, restitutionary relief ought to be awarded…

 

[underlining added; italics added by Stinson J.]

 

265 The word “officious” is defined in the Concise Oxford English Dictionary, 11th ed. (Oxford University Press, 2004), as “asserting authority or interfering in a domineering way”.

 

266 The Supreme Court of Canada discussed the concept of “incontrovertible benefit” as providing a basis for restitution of unsought benefits in Peel (Regional Municipality) v. Canada, [1992] 3 S.C.R. 762(S.C.C.), at 795-796:

 

An “incontrovertible benefit” is an unquestionable benefit, a benefit which is demonstrably apparent and not subject to debate and conjecture. Where the benefit is not clear and manifest, it would be wrong to make the defendant pay, since he or she might well have preferred to decline the benefit if given the choice.

 

It is thus apparent that any relaxation on the traditional requirement of discharge of legal obligation which may be effected through the concept of “incontrovertible benefit” is limited to situations where it is clear on the facts (on a balance of probabilities) that had the plaintiff not paid, the defendant would have done so. Otherwise, the benefit is not incontrovertible.

Court Adds Bequest to Will Omitted By Drafting Solicitor

Drafting Solicitor

Daradick v McKeand Estate 82 ETR (3d) 324, the Ontario Supreme Court made a very practical decision to allow the rectification of the will where there had been obvious drafting solicitor negligence in omitting a specific and substantial bequest.

The case reviews both the law of British Columbia and Ontario, and perhaps leads to the conclusion that the Ontario law is more flexible than that of British Columbia in allowing rectification of wills.

 

The testator made wills in 1992 and 2005, and left the matrimonial home in both wills to her daughter, provided that the testator’s husband was not alive at the time of her death.

The testator’s husband died in 2005.

In 2010 the testator’s solicitor took instructions from her regarding a new will, and according to the drafting solicitor, the testator instructed him that the matrimonial home was to be gifted to the daughter, and he made note of this on the reverse side of his sheet of notes.

According to the drafting solicitor, his secretary did not see the notes regarding the bequest of the matrimonial home to the daughter on the other side of the will, and she prepared the 2010 will without reference to that bequest.

 

After the testator’s death, the daughter brought a court application to rectify the 2010 will.

 

The court allowed the will to be rectified by adding that the matrimonial home would be bequeathed to the daughter.

 

Because the respondents led no rebuttal evidence, it was surmised that the facts as stated in the affidavits of the daughter and the solicitor were not challenged.

 

In the solicitors affidavit, he acknowledged that he made an error and that he did not include the matrimonial home in the 2010 will, as he had been instructed to do.

 

The court determined that the solicitors error could and should be corrected. If the 2010 will were not rectified, then the only other recourse of action would be a lawsuit against the solicitor or the estate, or both, which would be very costly.

33 The respondents cited a number of court cases from the Provinces of Alberta and British Columbia, which state that the courts have very limited powers in rectifying wills. They also cited Feeney’s Canadian Law of Wills, 4th edition.

 

34 At 3.26 Feeney wrote the following:

 

The approach in Re Rapp was rejected by McFayden J. of the Alberta Court of Queen’s Bench, and more recently by Melvin J. and Burnyeat J. of the Supreme Court of British Columbia. Justice Burnyeat suggested that the Rapp decision overlooked the contrary decision of the Court of Appeal in Clark v. Nash, which should be followed. It seems that the traditional restrictive view is still law.

 

35 However the author does state at 3.28 the following:

 

…Yet, when the mistake is that of a draftsperson who inserts words that do not conform with the instructions he or she received, then, provided it can be demonstrated that the testator did n and him and him ot approve of those words, the court will receive evidence of the instructions (and the mistake) and the offending words may be struck out.

 

36 The Court of Appeal in British Columbia stated in Clark v. Nash, [1987] B.C.J. No. 304(B.C. C.A.) the following:

 

… [N]o case supports the proposition that a Will that is a complete Will so far as form and content are concerned can be rectified by substituting as residuary beneficiaries the names of ten persons who are legatees named in that Will for two other persons.

 

37 As I stated earlier, the respondents did not cite any cases from the Province of Ontario.

 

38 In the Robinson Estate v. Robinson, [2010] O.J. No. 2771(Ont. S.C.J.), Mr Justice Belobaba wrote the following at paragraphs 24, 25, 26 and 27:

 

24. Where there is no ambiguity on the face of the will and the testator has reviewed and approved the wording, Anglo-Canadian courts will rectify the will and correct unintended errors in three situations:

 

(1) where there is an accidental slip or omission because of a typographical or clerical error;

 

(2) where the testator’s instructions have been misunderstood; or

 

(3) where the testator’s instructions have not been carried out.

 

25. The equitable power of rectification, in the estates context, is aimed mainly at preventing the defeat of the testamentary intentions due to errors or omissions by the drafter of the will. This is a key point. Most will-rectification cases are prompted by one of the above scenarios and are typically supported with an affidavit from the solicitor documenting the testator’s instructions and explaining how the solicitor or his staff misunderstood or failed to implement these instructions or made a typographical error.

 

26. Courts are more comfortable admitting and considering extrinsic evidence of testator intention when it comes from the solicitor who drafted the will, made the error and can swear directly about the testator’s instructions. They are much less comfortable relying on affidavits (often self-serving) from putative beneficiaries who purport to know what the testator truly intended.

 

27. Here is how Feeney’s puts it:

 

[T]he application for rectification is usually based on the ground that, by some slip of the draftsman’s pen or by clerical error, the wrong words were inserted in the will; the mistake may be latent in the letters of instruction or other documents. Yet, when the mistake is that of the draftsperson who inserts words that do not conform with the instructions he or she received, then, provided it can be demonstrated that the testator did not approve those words, the court will receive evidence of the instructions (and the mistake) and the offending words may be struck out.

 

39 The Ontario Court of Appeal upheld the decision of Justice Belobaba. See Robinson Estate v. Robinson, [2011] O.J. No. 3084(Ont. C.A.).

 

40 Mr. Justice Pattillo, in Lipson v. Lipson, [2009] O.J. No. 5124(Ont. S.C.J.), stated the following at paragraphs 32 and 39-42:

 

32It has been long established in Ontario that the court has the power to delete or add words to a will by necessary implication.

 

. . .

 

39In Mistakes In Wills In Canada, by Stan Sokol (Carswell, 1995), at p. 95, the learned author, referring to the above noted cases, summarizes the criteria which must be established before a court can add words to a will as follows:

 

1. upon reading of the will, it must be apparent on the face of the instrument that a word or words have been omitted from the will,

 

2. from a reading of the will as a whole, the intention of the testator must be so strongly expressed that the language of the will could not support a reasonably contrary intention or interpretation, and

 

3. from a reading of the whole will and in light of surrounding circumstances, the court must be able to determine, with sufficient precision, what the omitted words were which are required to give effect to the testator’s intention.

 

40In Myhill Estate v. Office of the Children’s Lawyer(2001), 39 E.T.R. (2d) 90 (Ont. S.C.J.), Haley J., in considering whether certain words should be added to a will, referred to and applied the three criteria set forth in Mistakes in Wills in Canada, supra.

 

41Surrounding circumstances include circumstances surrounding the making of the will; the testator’s property at the time of the will; the testator’s use of property; the testator’s relationship to named and potential beneficiaries; and prior wills. See: Harmer Estate, supra, at para. 30 and 31; Mistakes in Wills in Canada, supra, pp. 211-214.

 

42In my view the above principles concerning when a court can delete or add words to a will apply not only in circumstances where a word or words are omitted but also where an incorrect word or words are contained therein. In either case, before a court can delete or insert words to correct an error in a will, the Court must be satisfied that:

 

(i) Upon a reading of the will as a whole, it is clear on its face that a mistake has occurred in the drafting of the will;

 

(ii) The mistake does not accurately or completely express the testator’s intentions as determined from the will as a whole;

 

(iii) The testator’s intention must be revealed so strongly from the words of the will that no other contrary intention can be supposed; and

 

(iv) The proposed correction of the mistake, by the deletion of words, the addition of words or both must give effect to the testator’s intention, as determined from a reading of the will as a whole and in light of the surrounding circumstances.

Disclaimer of Life Interest Accelerates Children’s Subsequent Interests

 

 

AccelerationDisclaimer and Acceleration in estate disputes

 

Re Brannan Estate v Public Trustee (1991) 41 ETR 210 BCCA.

The deceased testatrix who died in 1987, directed her trustees to pay $400 per month to her husband until his death or remarriage, whichever occurs first.

She then directed the trustees upon the death of her husband, to divide the residue of her estate into as many equal shares as there were children of her alive at the time of her death. The will also provided that should he remarried, the residue was to be dealt with in the same manner as if he had died

The husband subsequently disclaimed any right title or interest in the testatrix’s estate, with the intent that the gift of the residue to the three children would accelerate. He had not remarried.

 

An application was made to the Supreme Court for determination of the question whether the husband’s disclaimer had in fact accelerated the gift of the children. The Supreme Court agreed that the gift had been accelerated, and the Public Trustee, acting on behalf of infant grandchildren of the testatrix appealed.

 

The Court of Appeal dismissed the appeal and accelerated the gift in favor of the children of the deceased

 

The BC Court of Appeal canvassed much of the law relating to acceleration, and in fact relied upon and Australian decision Re Syme (1980) VR 109.

Many cases dealing with acceleration were cited by counsel.

The decisions show some conflict in their results and are not easy to reconcile. However, I think it unnecessary to embark upon a detailed examination of them, for in the Australian case of Re Syme, [1980] V.R. 109 (Aust., Vic. Sup. Ct.), Lush J. reviewed most of the leading cases and analyzed them in a manner upon which I cannot improve. He said, at pp. 114-115:

“The general principles governing acceleration are stated in Lainson v. Lainson (1854), 5 De G.M. & G. 754; 43 E.R. 1063. In that case the testator gave a life interest to his son, and after his decease he have successive entailed interests to the first and other sons of that son. By a codicil the testator mistakenly revoked the life interest given to the son. It was held that the effect of the revocation was to accelerate the interest of the first son of the son.

Turner, J.J., speaking of the expression ‘from and immediately after his decease’, said at (De G.M. & G.) pp. 756-7, (E.R.) p. 1064: ‘These words may have one of two imports, either that the grandson was to take nothing till after the death of his father, or else merely to shew the order of the limitations, through which the estate was to pass. I take the cases cited to establish the proposition, that, prima facie, these words are to understood [sic] as denoting the order of succession of the limitations. Is there anything in the will to lead to a different conclusion? I can see nothing. If John Lainson had died, there can be no doubt that the grandson would have come into posses­sion immediately; and what difference does it make, whether the previous estate is removed by death or by revocation? The words of the codicil seem to me to confirm this view. It is the clear intention of the will to dispose of all the estate for the benefit of the testator’s son, and his issue. The codicil does not at all alter this intention, but only changes the order of succes­sion in which the devisees are to take. No doubt, a will might be drawn in such a way as to shew an intention that the remainder-man should not take till after the death of the first devisee; but there is nothing in this codicil to shew such an in­tention.’

The subject matter of this decision was taken up in Jull v. Jacobs (1876), 3 Ch. D. 703. In that case there was a gift to a daughter, ‘and after her decease the property to be equally divided between her children on their becoming of age’. The life interest given to the daughter failed because she had wit­nessed the will. Malins, V.C. at p. 709 said: ‘Whenever the life estate expires those in remainder take. Therefore, under the old law, when life estates were forfeitable by any of those acts which formerly would have caused a forfeiture; where property was limited to A. for life, and after the decease of A. to A.’s children, if A. had forfeited the life estate his children would have immediately a right, because “from and after the decease” means from and after the determination of the life estate, and however it is terminated, whether by the death of the tenant for life or by forfeiture, it is equally gone.’

His Lordship went on to say that on the terms of the will the children had been postponed simply to allow the mother to have the property for life, and the testator’s intention would have been, that if the mother was not have it [sic], the children should have it immediately.

Since Jull v. Jacobs, the question of acceleration of subsequent interests on the determination of a prior interest by invalidity, forfeiture or disclaimer has been dealt with in many cases. In some of these the question of the closing of a class at the ac­celerated date of distribution has been dealt with as a subject of separate consideration. Cases which I have considered may be grouped as follows. First there are cases in which it was held that an acceleration of the subsequent interests was excluded by a contrary intention. Cases within this group are: Re Townsend (1886), 34 Ch. D. 357; Re Flower’s Settlement Trusts, [1957] 1 W.L.R. 401; [1957] 1 All E.R. 462; Re Young’s Settlement Trust, [1959] 1 W.L.R. 457; [1959] 2 All E.R. 74, and/te Scott, [1975] 1 W.L.R. 1260; [1975] 2 All E.R. 1033. Re Townsend was a case in which it was held that there was no acceleration, because there was no beneficiary qualified at what would have been the accelerated date to take the gift. Chitty, J. in his judg­ment suggests that if there had been such a beneficiary he might have held that acceleration had occurred; though, for myself I do not think that his view on this point clearly emerges from his words. In the other cases the matter was determined on the words of the instrument alone, although there were identified and existing takers for the subsequent gifts.

In the next group of cases the decision was that acceleration oc­curred, and this was notwithstanding the fact that acceleration affected the constitution of the class to take the subsequent gift. Such cases are: Re Johnson (1893), 68 L.T. (N.S.) 20; Wyndham v. Darby (1896), 17 N.S.W.R. 272 (E.); Re Crothers’ Trusts, [1915] 1 I.R. 53; Re Chartres, [1927] 1 Ch. 466; Re Davies, [1957] 1 W.L.R. 922; [1957] 3 All E.R. 52; Re Dawson’s Settlement, [1966] 1 W.L.R. 1456; [1966] 3 All E.R. 68.

It is to be noted in both Re Johnson and Re Chartres that there are to be found expressions of doubt or hesitation by the Judges who decided them, and Re Chartres and Re Davies have at­tracted subsequent criticism.

It may also be observed that in Re Johnson Stirling, J. approached the matter on the basis that there were two separate problems, whether the gift was accelerated, and whether the constitution of the class was affected by accelera­tion. The same approach appears in some of the other cases, but most markedly in two cases which constitute a third group in which it was held that the gift was accelerated, but that this was not be allowed to affect the constitution of the class. These are:

Re Kebty-Fletcher’s Will Trusts, [1969] 1 Ch. 339; [1968] 2 W.L.R. 34; [1967] 3 All E.R. 1076 and tfe Harker’s Will Trusts, [1969] 1 W.L.R. 1124; [1968] 3 All E.R. 1. I so classify the first of these cases because the main discussion in it is con­cerned with the date of closing of the relevant class, an ap­proach which was perhaps dictated by the form of the summons (see 1 Ch. p. 344 et. sequ.). However, in the penultimate paragraph of the judgment Stamp, J. said that the instruments executed by the life tenants did not either bring about an ac­celeration or alter the composition of the class.

With these two cases, there may perhaps be joined in Re Taylor, [1957] 1 W.L.R. 1043; [1957] 3 All E.R. 56 in which an ac­celerated gift was held to operate subject to subsequent defeasance.

In Wyndham v. Darby, Manning, J. at p. 279 (E.) referred with approval to Re Johnson and quoted the passage which indicated the consideration of two questions. However, in my opinion a reading of the two judgments delivered in the case, those of the Chief Justice and Manning, J., leads to the conclusion that each Judge was really dealing with the case as raising a single ques­tion only.”

Lush J. found a common thread of principle to be derived from the decided cases which he expressed, at p. 116:

“Both the results and the reasoning of these authorities present difficulties, but the theme which runs through them is that whether or not a gift is accelerated is a matter of intention; a theme particularly illustrated in the only recent decision by an appellate court. Re Flower’s Settlement Trusts. For myself I would accept the argument that the position now is that on the premature determination of the particular interest the sub­sequent interests are accelerated unless there is an intention to the contrary.

The cases show that acceleration is not excluded by words defining the time of distribution by reference to the natural en­ding of the particular state, for instance, a direction for distribu­tion upon the death of the life tenant (see Lainson v. Lainson and Jull v. Jacobs) or by a direction that distribution is to be made among persons then living (see Re Johnson and Re Crothers’ Trust). As to the latter point, I have not overlooked Re Townsend or Re Taylor, nor the indications in them that a contingent gift cannot be accelerated. To extend that proposi­tion so as to make acceleration impossible if there is contin­gency or survivorship would, I think, be contrary to the weight of authority and to the very concept of acceleration (see Re Harker at (W.L.R.) p. 1127). However, in Wyndham v. Darby at pp. 277-8 and in Re Harker at (W.L.R.) p. 1128, (All E.R.) p. 5 a distinction is drawn between gifts on the death of a life tenant to the children of the life tenant and gifts in similar cir­cumstances to the children of another. The quotation above from Jull v. Jacobs suggests that Malins, V.C. may not have regarded the distinction as significant. It is said that in the former case the testator must have intended all possible mem­bers of the class to take. In the example given, this may be so, but as soon as a contingency of survivorship is introduced the testator can have intended no more than that every member should have a chance to take; some may be omitted if they die too soon, and it is not a far cry from this to omitting some be­cause they are born too late. It is probably safest to ask whether the individual will or other instrument discloses that it was an essential part of the testator’s intention that all possible mem­bers of the class should have this chance.

Court Considers the Equities of Assets that Passed Outside of the Estate

assets passing outside estate 2

In Nightingale v Hepting 2010 BCSC 1214, the evidence was that the testator wanted to marry H, whom he met in 1976, but that they instead remained friends and vacationed together, and that H drove the testator around . H had a net worth of $850,000 and annual income of $28,500. The Testator’s only child, K, had an annual household income of $118,000 and net worth of about $420,000.

 

The Testator had a cordial relationship with K and K’s sons, S and A. S was 21, had a learning disability and would likely remain dependent on K, but had earned income in past and had $531 monthly disability pension. Testator’s 2006 will, left 55 per cent of estate to son K, 5 per cent to grandchildren S and A, and the remainder to H.

 

Shortly before the testator’s death, K saw to the preparation of a transfer of his condo in joint tenancy to himself and K, but the testator did not sign and indicated he wanted any legacy to H to pass outside of his will.

 

The Testator died in 2007 and over $200,000 passed to K by way of survivor benefits, CSBs, and contents of a joint bank account. The estate’s assets, including the condo, were valued at $556,243.97.

 

K brought an application to vary under s. 2 of Wills Variation Act and the application was dismissed.

 

The Testator was aware of moral obligation to K which was heightened by obligation to support S who was disabled. The bequest to K was adequate to make proper provision and was within range of dispositions deemed adequate when compared with other cases. Although the testator recognized his moral obligation to K, the evidence indicated the testator was conflicted and had a strong desire to leave a legacy to H.

 

The Testator’s mind was not settled on provisions other than those in will — Any change the testator might have made was not issue. The relevant process under s. 2 was objective analysis of whether provisions fell within range of adequate dispositions.

 

When survivor benefits, CSBs, and contents of joint bank account were considered as forming part of estate’s value, value was about $760,000, so K’s share was $510,000, or approximately 67 per cent.

 

K was not rich but had comfortable income, equity in home, and had set aside modest assets for future. The Testator was favourably disposed to S and open to contributing to S’s future, but objective was likely seen by testator as feature of a moral commitment to K . His significant bequest to K was substantial recognition of K’s status as testator’s only child and an amount capable of helping to support K in providing for children, including S’s special needs.

 

The competing bequest recognized H’s assistance and companionship in their long, supportive relationship which testator clearly valued highly .It was significant that the testator had expressed intention to have bequest to H take form which would pass outside of estate and purview of statute. In other cases reviewed, the highest percentage of an estate a child or claimant in comparable position received was only 50 per cent.

 

Tataryn v. Tataryn Estate, [1994] 2 S.C.R. 807, 116 D.L.R. (4th) 193(S.C.C.) (“Tataryn”), is the leading decision on the application of s. 2. McLachlin J., writing for the Court in Tataryncommented on s. 2 at 814:

 

The language of the Wills Variation Act is very broad. The court must determine whether the testator has made “adequate provision” for his spouse and children. If it concludes he or she has not, the court “may, in its discretion, … order … the provision that it thinks adequate, just and equitable in the circumstances”.

 

25 The obligation to make “adequate provision” was analysed in two contexts:

 

(1) in recognition of the testator’s legal obligations as existed before his or her death to provide maintenance for a spouse or dependent child, or to recognize an enrichment to the testator’s estate through the contributions of a spouse or child;

 

(2) in recognition of the testator’s moral obligation to a claimant, an obligation that would generally be recognized as existing notwithstanding the absence of any legal obligation. Such a moral obligation is the operative consideration where the bequest is to an independent adult child.

 

26 The testator’s ability to make further provision for beneficiaries beyond the claimant categories recognized in the statute is discussed in Tatarynat 823:

 

… A will may provide a framework for the protection of the beneficiaries and future generations and the carrying out of legitimate social purposes. Any moral duty should be assessed in the light of the deceased’s legitimate concerns which, where the assets of the estate permit, may go beyond providing for the surviving spouse and children.

 

27 The authorities display a variety of circumstances impacting on the acceptability of the particular bequests in question and no two cases appear to be very much alike. Four that have some value here are:

 

1. Clucas v. Clucas Estate, 25 E.T.R. (2d) 175, [1999] B.C.J. No. 436(B.C. S.C.);

 

2. Smith v. Smith Estate, 2009 BCSC 1737(B.C. S.C.);

 

3. Sawchuk v. MacKenzie Estate, 2000 BCCA 10, 184 D.L.R. (4th) 156(B.C. C.A.); and

 

4. Wilson v. Watson, 2006 BCSC 53(B.C. S.C.).

 

28 In Clucas, the claimant was a disabled son given a life interest in one-third of the testator’s $440,000.00 estate. Two-thirds of the estate was to be divided between his sister’s four children. The claimant’s sister did not participate herself and was significantly better off than her brother.

 

29 The life estate the claimant was to participate in was eventually to pass to the same four grandchildren and a fifth grandchild, the claimant’s daughter, equally. Satanove J. found the bequest inadequate and settled on a $200,000.00 bequest to the son, representing approximately 45% of the estate.

 

30 The son’s claim in Clucascan be seen as tempered in comparison to the case at bar in that, in Clucas, the claimaint’s sister (or her children) can be seen as presenting a competing interest; however, his degree of need was markedly increased by his disability.

 

31 In Smith, the claimant was an only son. His mother’s will did not include him and directed that her $230,000.00 estate be held in a trust in favour of her two grandchildren, the claimant’s children, for educational purposes with the residue going to them at age 30. The testator had a surviving husband. He was not included in the estate, but took the testator’s interest in the family home by way of survivorship. The son’s circumstances were modest.

 

32 Williams J. held that the will failed to make adequate provision for the son and varied the will to give him one-half of the estate.

 

33 Sawchuk, was a case involving an only daughter’s claim to her mother’s estate. The daughter was left $10,000.00 out of the $4 million estate, with 80% of the residue, after some minor legacies, going to the testator’s step grandchildren and the claimant’s children. At trial, the claimant’s interest was increased to $500,000.00, a disposition varied by the Court of Appeal, to $1 million. This represents approximately 25% of the estate, albeit the estate was significantly larger than is the case here. This increase in the daughter’s favour was justified in the following terms. Mackenzie J.A., speaking for the Court of Appeal, said this at para. 17:

 

17 … I think that a judicious parent would make a provision sufficient to allow the appellant to live in her own residence in an area of greater Vancouver generally similar to the that [sic] of the testatrix.

 

34 In Wilson, the claimant was again the sole surviving child of the testatrix. The estate amounted to $186,000.00. The will limited the claimant’s interest to 1% of the estate with the testatrix stating that the claimant had treated her disrespectfully. The balance passed to friends and a niece. The claimant was a person of modest circumstances. The court found there was no evidence to support the disinheritance and increased the claimant’s share to 50% of the estate.

 

Discussion

 

35 Firstly, I’ll deal with the evidence relating to the series of events that occurred shortly before the testator’s death, which may ultimately have culminated in the testator making a separate provision in his will in respect of the condominium. These steps were precipitated by the plaintiff’s strong objection to this major asset passing under the terms of the existing will. I find that although it’s clear that the testator recognized he had a moral obligation to his son, the evidence also indicates that the testator remained conflicted in respect of his strong desire to leave a significant legacy to Ms. Hepting. I take from the fact that he declined to execute the subsequent documents presented by Ms. Samji and his words to her when she presented them, as indicating that notwithstanding his son’s argument, the testator was not settled in his mind on a different set of provisions. It is conjecture whether the plaintiff’s arguments to his father would ultimately have resulted in a significant change. Further, what might have happened is not the issue. As stated in Tataryn, the relevant process is an objective analysis of whether the provisions of the will in question meet the obligations imposed by s. 2, of falling within the range of adequate dispositions.

 

36 Secondly, I take into account the full disposition of assets on death in determining the adequacy of the provisions of the will. The testator’s interest in the RIF, the Canada Savings Bonds and the joint bank account, passed to the plaintiff by way of survivorship, but this simply amounted to another way of managing the transfer of the testator’s net worth. To my mind, the equities of assets to be determined in assessing the adequacy of the provisions in the will include consideration of the transfer of these assets. Including these sums in the accounting, the gross value of the estate is approximately $760,000.00, and the plaintiff’s share amounts to $510,000.00, or approximately 67% of the assets passing on the testator’s death.