This video is about delusions and testamentary capacity required to make a will. The leading decision of testamentary capacity is Banks versus Goodfellow from 1857 which held that in order to have valid capacity, a person must 1) know what a will is; 2) know what assets he or she has and their value; 3) know who are not to be considering in leaving a bequest; and 4) be free of delusions that affect their ability to decide all of the above.
A person may be crazy but still have mental capacity. In fact, in the leading case of Banks versus Goodfellow, he thought his niece was the devil. On the other hand, he provided for his niece and she was his only next of kin and caregiver and the courts ultimately held that the will was valid.
I’ve had many cases involving delusions and it is difficult to tell when a person has a delusion when one first meets them. What will be obvious in time is that they hold a fixed and very rigid belief that most people would consider to be not be true. The person may in fact be psychotic.
Some of the different types of delusions are grandiose, a person may think they’re a megalomaniac or erotomania, they may feel that they’re in love with a very special public person and that that public person loves them as well. There can be delusions of persecution and delusions of your body doesn’t function at all. You’ve considered yourself for example paralyzed and any combination of those. But again, it’s difficult for the solicitor taking instructions from a person with aversions to actually realize that they may not have proper capacity to do a will.
What happens when you lose your will? Many people, in fact, do. They might be hoarders or they might be very careful people but they don’t appreciate that that document that they signed many years ago and took home is perhaps the original of a very valid document that only takes effect upon a death. So it’s important to safeguard where the will is kept.
The main reason is that if the will is lost while in your possession and then you die, you are presumed to have revoked that will and that the will no longer exists. This is a rebuttable presumption and the court will be allowed to look at whether you referred to the will, whether you referred to the will to your general nature as to what type of person you were and to any other previous wills that you might have done in an attempt to see if the presumption can be rebutted. The most important thing to remember though is to safeguard your will.
This video is about capacity to marry. That’s mental capacity. We all know the story of Anna Nicole Smith and her love affair and marriage to the 94 year-old billionaire. After his untimely passing, there was years and years of litigation which centered on whether he had mental capacity to marry the late Anna Nicole Smith. It never did get resolved.
At common law, very little intelligence was required to enter into the simple contract of marriage. More recently, the courts have taken a more realistic and modern view that the contract of marriage is not as simple as it once was and that a higher standard of capacity is required.
What disclaimer means is that if you inherit under a will, no one can force you to actually accept the inheritance. Now, why wouldn’t you want and accept an inheritance? But there are situations where it does exist.
For example, in one particular case, a deadbeat father had not paid child maintenance for many, many years. When his own father in fact died, and the deadbeat was about to inherit a substantial sum of money, he learned that his wife and his children were about to attach on to the inheritance. He accordingly disclaimed the interest in the inheritance just to further punish the wife and children and that right to disclaim was upheld by the courts.
Another benefit of disclaimer can be the introduction of the doctrine of acceleration. For example, if one person benefits for their lifetime and it is to be ultimately turned over to their essential beneficiaries upon their death, they can refuse the inheritance which will accelerate the inheritance of the residual beneficiaries. That can sometimes be advantageous to all parties.
What Cy-Pres Doctrine means is that the courts will try and find a general testamentary intentioned to benefit a charity. If that charity has been misdescribed in your will, the courts will try and find another charity of a similar fashion and intention to instead inherit.
For example, in Vancouver, everyone seems to think that there’s an entity known as Children’s Hospital. It is commonly used in verbiage but it does not legally exist. So if a will is written leaving the assets to a charity such as Children’s Hospital, and the charity has been misnamed, the courts will try and put their self in the position of the testator to find out what the true intention was in benefitting a particular charity and find a substitute charity to instead benefit.
DNA in British Columbia estate litigation is widely used and it is readily accepted by the courts as proof of paternity in particular. The first time I used DNA was in approximately 1991 when somebody committed suicide off a ferry. Their body was never found. A child from the Northwest Territories of Canada came forward and said that he was her father. She had no proof whatsoever of this. She had a photograph of him in which he looked somewhat like him but other than that, the marriage certificate and birth registration made no mention of this child.
We obtained DNA from the deceased siblings across the country and it concluded that 99.99 percent that she was his child. He died without a will. She inherited his entire estate. It is common to use DNA in estate litigation as many, many people find out late in life that who they thought was the father was in fact not their father. I recently had this happen of the 55 year-old man who found out that his father was not in fact his father and another man who had lived with the family was. It was quite a shock, needless to say. Court orders can be obtained to force people to grant DNA. It is a discretionary remedy but such an order can be obtained if it is necessary. I’ve done so in several occasions.
The Manitoba Supreme Court in Krawchuk v Krawchuk 2017 MBQB 47 outlined the legal obligations of a power of attorney.
Manitoba’s laws for powers of attorneys are essentially the same as for British Columbia.
The Court stated inter alia as follows:
18 The applicable law with respect to the obligation of an attorney in his or fiduciary relationship with the donor was not at issue. Some of the applicable principles can be summarized as follows:
(a) as a fiduciary, an attorney has an obligation to act in the best interests of the settler or donor and cannot permit his or her personal interests to conflict with that obligation (see Brown v. Lefebvre, 2007 ABQB 195, 419 A.R. 347 (Alta. Q.B.) at para. 20);
(b) the obligations of an attorney include keeping proper accounts of the trust estate, distinct from other accounts and preserving receipts for cancelled cheques (see Re Lefebvre at para. 21);
(c) the obligations of an attorney include producing accounts to the donor, court and any beneficiary and insuring the accounts clearly show all monies and assets received or accounted for;
(e) breach of a fiduciary relationship gives rise to the widest array of equitable remedies (see Todosichuk at para. 21; Wewaykum Indian Band v. R., [2002] 4 S.C.R. 245, 2002 SCC 79 (S.C.C.));
(f) equitable remedies are always in the discretion of the court which is concerned not only in compensating a wronged plaintiff but also in upholding the obligations of good faith and loyalty (see Todosichuk at para. 22; Canson Enterprises Ltd. v. Boughton & Co., [1991] 3 S.C.R. 534 (S.C.C.));
(g) the fiduciary relationship has trust, not self-interest, at its core, and when breach occurs, the balance favours the person wronged (see Todosichuk at para. 22; Canson Enterprises at p. 543 per McLachlin J. (as she then was)); and
(h) in considering whether to grant a remedy, and if so, the nature of the remedy, the question of deterrence is often most relevant (see Todosichuk at para. 25).
Whether property be owned as tenants in common, or as joint tenants, if the parties cannot agree on the sale of the property, the BC Court has the power to do so under the provisions of the Partition of Property Act RSBC. This blog sets out the type of partition and sale court order that should be sought.
The jurisdiction to order the partition or sale of land owned by co-tenants is found in the Partition of Property Act, R.S.B.C. 1996, c. 347
In an Ontario case MammomeEstatevMammome 2017 ONSC 3403 there was initially a court order made for partition and Sale that was subsequently amended by a second court order that provided for greater certainty due to the failure of one party to co operate with the named realtor by such things as refusing to allow a for sale sign and refusing to sign a listing agreement.
First Order
THIS APPLICATION made by the Applicants for an order directing the properties municipally known as 7912 Kipling Avenue and 7918 Kipling Avenue, Vaughan, Ontario (the “Properties”) be sold, for an order directing an accounting of the income and expenses of the Properties, and for an order directing that the Respondent Density Garden Enterprises Inc. be wound up, and this CROSS-APPLICATION made by the Respondents for an order for specific performance directing that the Applicants’ one-half direct and indirect interests in the Properties be sold to the Respondent, Emilio Mammone, . . . .
1. THIS COURT ORDERS THAT the following lands and premises be listed for sale, marketed and sold:
2. THIS COURT ORDERS THAT the sale of the Properties shall be conducted in accordance with the following:
(a) The Parties shall retain a real estate agent selected by the Applicants, to assist with the listing for sale, marketing and sale of the Properties, and who shall act on the instructions of the Applicants;
(b) The Parties shall retain Frank Sgro, real estate solicitor, to assist with the completion of the legal work necessary to facilitate and effect the sale of the Properties; and
(c) The Parties will accept offers to purchase either of the Properties if such offers are recommended for acceptance by the real estate agent identified in subparagraph (a) above, and will otherwise take all reasonable steps to co-operate with the real estate agent to effect the sale of the Properties.
3. THIS COURT ORDERS THAT the net proceeds of the sales of the Properties shall be paid as follows:
(a) in respect of 7912 Kipling,
(i) 50% thereof to the Estate of Frank Mammone, and
(ii) 50% thereof to the Respondent Emilio Mammone,
4. THIS COURT ORDERS that the Cross-Application of the Respondents is dismissed.
5. THIS COURT ORDERS that the Respondents shall provide an accounting to the Applicants with respect to all rental and other revenues generated by the Properties, and all taxes and expenses paid . . . . The accounting agreed to by the Parties shall include an assessment of the services performed by Emilio Mammone for the purpose of calculating its value. . . .
7. . . . . subject to the accounting hereafter referred to;
(b) in respect of 7918 Kipling,
(i) 50% thereof to the Estate of Frank Mammone, as a shareholder of 50% of the shares of the Respondent, Density Garden Enterprises Inc. and,
(ii) 50% thereof to the Respondent Emilio Mammone, as a shareholder of 50% of the shares of the Respondent, Density Garden Enterprises Inc.
subject to the accounting hereafter referred to.
The Applicants brought their application to sell the properties and to remove Emilio as a participant in the sale process.
C. Discussion and Analysis
22 It undoubtedly saves considerable legal expense if the parties to a Partition Act proceeding will co-operate to sell the property, but in the immediate case, the parties will not co-operate and more expensive direct court intervention is required. There is little doubt that Justice Dow’s Order is not working and that the Order needs to be revised to bring closure to this family dispute in a way that is fair to both sides.
23 There is no dispute that the court has the jurisdiction to vary Justice Dow’s Order and both parties sought the court to exercise the jurisdiction in their favour and in a way that would disfavour the other.
24 Court supervision in a Partition Act application is typically done by referring the sale to a Master, but, in my opinion, that is not necessary in the immediate case and all that is required is to delete paragraph 2 from Justice Dow’s Order and to substitute the following:
Amended Order
2. THIS COURT ORDERS THAT the sale of the Properties shall be conducted in accordance with the following:
(a) The Applicants shall retain and sign a standard listing agreement with a term of 45 days with Alfredo DiGenova, to assist with the listing for sale, marketing and sale of the Properties, and who shall act on the instructions of the Applicants;
(b) The Parties shall retain Frank Sgro, real estate solicitor, to assist with the completion of the legal work necessary to facilitate and effect the sale of the Properties;
(c) The acceptance of any offer is subject to court approval and if the Applicants receive an offer within the listing period, they may bring a motion for court approval of the sale;
(d) The Respondent Emilio Mammone may submit offers but shall not have a right of first refusal;
(e) If no offer is received within the period of the listing, the Applicants may apply for an order extending the time for the listing of the properties or for any other order that is just;
(f) If the court approves the acceptance of the offer, and the Respondents refuse to sign the transfer to the purchaser, the court shall make a Vesting Order pursuant to s. 100 of the Courts of Justice Act;
(g) The real estate commission, conveyancing lawyer’s fees shall be paid out of the proceeds of sale; and
(h) If Emilio has not paid the costs awards of the Partition Act proceedings made against him, those costs shall be deducted from his share of the proceeds of sale.
If a lawyer does not have a contingency fee agreement or retainer agreement then the courts will use various criteria to determine the appropriateness of the legal fees based on quantum meruit (a reasonable fee for services rendered).
One of the chestnuts in this area of law is the Court of Appeal decision from Saskatchewan – Yule v City of Saskatoon 1955 , 17 WWR 296 which adopted the criteria set out in Re Solicitor:
Under Supreme Court Rule 20 – 2 (2) a proceeding brought by or against a person under a legal disability must be started or defended by his or her litigation Guardian.
A person is typically under a legal disability when under the age of 19 years, or has a disorder of the mind that seriously impairs the person’s ability to react appropriately to the court and its processes.
Rule 20 – 2 (8) (b) states that the proposed litigation guardian of the person under the legal disability must have no interest in the proceeding adverse to that person.
Rule 20-2 ( 1(11) states that if it is in the interest of a party who is under disability, the court may remove a point or substitute a litigation Guardian.
The Supreme Court of Canada, reviewed the criteria for appointing and removing a litigation Guardian in Gronnerud (LitigationGuardian of) v. Gronnerud Estate, 2002 SCC 38 (S.C.C.),
17 The Supreme Court of Canada, in its reasons at para. 3 and following, reviewed the history of the litigation and then reviewed the criteria for removing the litigationguardian. In so doing, the Court concluded that under the Saskatchewan Rule the test to remove a litigationguardian turned on the “best interests of the dependent adult”. The Court set out criteria that it found from leading Saskatchewan authorities, which criteria I find would also be required on the appointment under our Rules of Court. These criteria set out in para. 19 by the Supreme Court of Canada are as follows:
1. the evidence must establish that the incompetent is unable to act for himself or herself;
2. evidence should be verified under oath as to the incompetent’s mental condition and his or her inability to act as plaintiff;
3. evidence must demonstrate that the litigationguardian is both qualified and prepared to act, and in addition is indifferent as to the outcome of the proceedings;
4. the applicant should provide some evidence to support the claim being made;
5. the applicant should obtain the consents of the next-of-kin or explain their absence;
6. if the applicant has a personal representative or power of attorney whose status is not being challenged in the proceedings, some explanation should be offered as to why the attorney or representative has not been invited to bring the claim. (my emphasis added)
18 Major, J. speaking for the majority said this at para. 20:
The third criterion, that of “indifference” to the result of the legal proceedings, essentially means that the litigationguardian cannot possess a conflict of interest, vis-a-vis the interests of the disabled person. Indifference by a litigationguardian requires that the guardian be capable of providing a neutral, unbiased assessment of the legal situation of the dependent adult and offering an unclouded opinion as to the appropriate course of action. In essence the requirement of indifference on the part of a litigationguardian is a prerequisite for ensuring the protection of the best interests of the dependent adult. A litigationguardian who does not have a personal interest in the outcome of the litigation will be able to keep the best interests of the dependent adult front and centre, while making decisions on his or her behalf. Given the primacy of protecting the best interests of disabled persons, it is appropriate to require such disinterest on the part of a litigationguardian. (my emphasis added).
19 In upholding the removal of the adult children as their mother’s litigationguardian, the Court noted that they could not act in their mother’s best interest because they failed to meet this particular criterion of “indifference”. At para. 22, relative to “indifference”, the Court said this:
In my opinion, The Court of Appeal was correct in removing Judy and Glenn as Cherie Gronnerud’s litigationguardians and replacing them with the Public Trustee. Judy and Glenn could not act in their mother’s best interests because they fail to meet the third Szwydky criterion. Namely, they were not indifferent as to the outcome of the proceedings surrounding the estate of Harold Gronnerud, such as the claim under The Matrimonial Property Act and the claim for dependent’s relief. As residuary beneficiaries under Harold’s will, Judy and Glenn have an interest in proceedings that could result in the movement of assets from Harold’s estate to Cherie’s estate. As Cherie’s 1967 holograph will is not broad enough to cover all potential assets passing from Harold’s estate, those new assets would be distributed to all four of Cherie’s children equally in accordance with the laws of intestacy. If proceedings brought by Cherie’s litigationguardian against Harold’s estate are successful, Judy and Glenn could stand to gain more as beneficiaries with one-quarter interest each in Cherie’s newly increased estate, as opposed to residuary beneficiaries under Harold’s will. It is obvious that Judy and Glenn cannot be said to be disinterested in the results of the legal proceedings. The Court of Appeal was correct to remove them as litigationguardians.
20 Applying that rationale to the circumstances at bar, I am of the view that, like the adult children in Gronnerud, Alan in this case is not “indifferent” to the outcome of the proceedings. These are matrimonial proceedings in which assets may move from the defendant, Winston Lodge, to the Estate of Mary Lodge. That is what family litigation is about. There is a claim for reapportionment advanced in the pleadings. As such, Alan would benefit from having as much as possible of his father’s holdings being reapportioned to his mother. His potential inheritance would be enhanced in value as the result of him being a beneficiary under his mother’s will. Given her incompetency due to Alzheimer’s disease, it is unlikely that she will ever make another will, or be in a legal position to change her designation of Alan as a beneficiary. He therefore could never be said to be indifferent as to the outcome of this family litigation. The same rationale would apply to Dean Lodge.
21 Applying these decisions from Ontario and Saskatchewan to Rule 6(8) and 6(10) of the Rules of Court establishes in my mind the following principles with respect to a litigationguardian in British Columbia, namely:
(a) a litigationguardian will be found to have an “interest in the proceedings” adverse to the person under disability where there is a “high level of conflict”, between the proposed litigationguardian and a party in the proceeding;
(b) a litigationguardian will also have an “interest adverse to the person under disability” in those cases where the litigationguardian stands to benefit, either directly or indirectly by the litigation, even if that benefit has not vested at the time of the appointment. It is sufficient that the potential benefit, realistically assessed, is present.
