BC Estate Litigation- S 58 WESA “Cure” Refused

Trevor Todd and Jackson Todd have over 60 years combined experience in handling the estate disputes, including interpreting purported wills and utilizing section 58 WESA.

 

In Reid estate 2024 BCSC 1932 the court refused to cure a hand written note written by the deceased, and held that it did not represent the last testamentary intentions of the deceased.

Section 58 applications are very fact determinative

The deceased was a longtime chronic alcoholic, and the evidence was that she would often call people in the middle of the night and ramble on in slurred speech.

 

The court found that the document was not proven to be on the balance of probabilities to be the fixed and final testamentary of the intentions of the deceased due to the following finding of facts:

 

  1. The document did not refer to itself as a will, but instead started with the words” I smell death”. The evidence was that she would use these types of words in her late night drunken phone calls;

 

  1. The date of the document was unclear as it was undated;

 

  1. The document was found to be incomplete in several aspects;

 

  1. There was a contradictory instruction as to the disposition of her remains. She wrote about internment and then wrote she wanted her ashes scattered, which are inconsistent with each other;

 

  1. The court questioned why she took a wills questionnaire form with her to the hospital, as opposed to simply not writing another handwritten document to support the allegation that she intended this to be a last testamentary document;

 

  1. The document was unwitnessed;

 

  1. She died at age 56, of liver failure due to severe alcoholism;

 

  1. She was asked if she had prepared a will and she replied that she had not done so and that she was thinking about leaving her estate to all her nieces and nephews, rather than the individual niece, the petitioner, with whom she was close, and who owned property as tenants-in-common with the deceased;

 

Section 58 is remedial legislation that confers on the court a broad discretion to order a document purporting to be a will be fully effective, despite non-compliance with formal requirements. For an order to be granted under s. 58, the court must be satisfied the document represents the testamentary intentions of the deceased: Hadley Estate (Re), 2017 BCCA 311 at paras. 34 to 35.

        In deciding whether to exercise this curative power, Justice Dickson in Hadley Estate referenced her earlier decision in Estate of Young, 2015 BCSC 182:

     As discussed in Estate of Young, s. 58 is very similar to Manitoba’s curative provision and thus the leading appellate authority on its meaning is George v. Daily. George and several other Manitoba authorities are reviewed in Estate of Young, which review need not be repeated. Their import is summarized at paras. 34–37:

      As is apparent from the foregoing, a determination of whether to exercise the court’s curative power with respect to a non-compliant document is inevitably and intensely fact-sensitive. Two principal issues for consideration emerge from the post-1995 Manitoba authorities. The first in an obvious threshold issue:  is the document authentic?  The second, and core, issue is whether the non-compliant document represents the deceased’s testamentary intentions, as that concept was explained in George.

      In George the court confirmed that testamentary intention means much more than the expression of how a person would like his or her property to be disposed of after death. The key question is whether the document records a deliberate or fixed and final expression of intention as to the disposal of the deceased’s property on death. A deliberate or fixed and final intention is not the equivalent of an irrevocable intention, given that a will, by its nature, is revocable until the death of its maker. Rather, the intention must be fixed and final at the material time, which will vary depending on the circumstances.

     The burden of proof that a non-compliant document embodies the deceased’s testamentary intentions is a balance of probabilities. A wide range of factors may be relevant to establishing their existence in a particular case. Although context specific, these factors may include the presence of the deceased’s signature, the deceased’s handwriting, witness signatures, revocation of previous wills, funeral arrangements, specific bequests and the title of the document:  Sawatzky at para. 21; Kuszak at para. 7; Martineau at para. 21.

     While imperfect or even non-compliance with formal testamentary requirements may be overcome by application of a sufficiently broad curative provision, the further a document departs from the formal requirements the harder it may be for the court to find it embodies the deceased’s testamentary intention:  George at para. 81.

         The material time for determining testamentary intentions on a s. 58 application is usually the time at which the document in question was created. However, as noted in Estate of Young, depending on the circumstances, the material time may vary on this key issue: Hadley Estate at para. 36. Extrinsic evidence of testamentary intent may be admissible, including evidence of events that occurred before, during, and after the document was created: Hadley Estate at para. 40.

         The onus is on the petitioner seeking to cure a non-compliant document to prove on a balance of probabilities that the document is authentic and that it represents the deceased’s testamentary intentions. Testamentary intention means a deliberate or fixed and final expression of intention of disposal of the deceased’s property on death. The material time for determining testamentary intentions is usually at the time when the document was created.

Vancouver Lawyer Estate Disputes- Executor Reimbursement for Fees and Disbursements

Trevor Todd and Jackson Todd have practiced estate litigation for over 60 combined years, including matters relating to executors.

Re Reagh Estate 2021 BCSC 1807 dealt with the issue of reimbursement to an executor for out of pocket expenses and legal fees.

Out of Pocket Expenses

An executor is entitled to be reimbursed out of the estate for all out-of-pocket expenses properly and reasonably incurred in the administration of the estate: Jackson v. King, 2003 BCSC 328 at para. 12. The threshold is low, so long as they were properly incurred and not improperly incurred, they are to be reimbursed: Royal Trust Corporation of Canada v. Clarke (1989), 1989 CanLII 2692 (BC CA), 35 BCLR (2d) 82 at pp. 86-87. The general principle of indemnification is also encapsulated in section 95 of the Trustee Act, R.S.B.C. 1996, c. 464, which provides that a trustee may reimburse themselves, or pay, or discharge out of the trust, all expenses incurred in the execution of the trust or trust powers.

Legal Fees

In Braich Estate (Re), 2017 BCSC 1140, the Court held that where there is a shortfall between a lawyer’s account and what the court considers proper indemnification, the executor will be personally responsible for the shortfall. At para. 51 the Court states:
The trustee or personal representative of an estate is personally liable for the legal costs incurred based upon the terms of the retainer. If the legal costs incurred are necessary and are proper charges against the estate, the trustee or personal representative of an estate may be reimbursed from the estate. Whether the costs incurred are necessary and are proper charges may be determined on a passing of the accounts. Further, the precise amount owing in legal bills could be determined at a review pursuant to the Legal Profession Act. If there is a difference or shortfall between the lawyer’s account and what the court considers proper indemnification for legal costs payable by the estate, the personal representative will be personally liable for the difference: Feth (Estate of), 2014 BCSC 970 at paras. 65 and 68.

A similar approach was taken in Collette Estate (Re), 2017 BCSC 473, where the Court states:

[5] Recently however, in this estate, assets are being sold, or have been sold, and whatever final distributions are to be made will likely take place about a year from now. The evidence does not show that assets of the estate have diminished in value from Mr. Baird’s delays, but I am satisfied that the substantial legal expenses he has incurred in his executorship would have been smaller had he moved more promptly in getting the assets liquidated.

Generally speaking, an executor is entitled to be indemnified for reasonable legal costs incurred for carrying out the business of the estate. The review of the legal costs will canvass the issues of whether the fees charged are excessive, whether they relate to the administration of the estate, or work done for the executor as beneficiary, and therefore in his personal capacity.
In any of these circumstances, the executor may be held personally responsible for the fees, rather than the estate: Feth (Estate of), 2014 BCSC 970 at para 65.

Vancouver Estate Litigation- Elder Financial Abuse

Trevor Todd and Jackson Todd have over 60 years combined experience in estate litigation including claims of elder financial abuse.

In King v Vimhel 2024 BCSC 1745 a predator who had gone into hiding was found in absentia to have committed elder abuse and ordered to pay punitive damages of $50,000 and return a $1.2 million house to an 88 year old victim with advanced dementia.

The victim was living alone when she met the defendant in 2013. In 2020 she made him a joint tenant on the home she had owned since 1991. He had little or no income  or assets when they met and he was living in his car. the court found that he immediately began to exert undue influence and control over the victim and within a year was in a romantic relationship with the victim and began to physically , verbally and mentally abuse her to the extent that she feared him as he told her he would kill her if she didn’t comply with his demands. He installed security cameras and double -sided locks so he could lock her in and she stopped seeing her family with whom she was close. He took over her finances and forged documents using her name and emptied  a bank account of hers of $515,000 .

He then hid her in a motel which had no cooking facilities and cost $3000 per month. Her daughter hired a private detective who found her in the motel where she was completely isolated and she was ” rescued” by the RCMP.

 

The court set aside the transfer of the joint tenancy home on the basis of both resulting trust and undue influence.

 

               Resulting Trust

 

In Pecore v. Pecore, 2007 SCC 17, the Supreme Court of Canada held:

[20]      A resulting trust arises when title to property is in one party’s name, but that party, because he or she is a fiduciary or gave no value for the property, is under an obligation to return it to the original title owner: see D. W. M. Waters, M. R. Gillen and L. D. Smith, eds., Waters’ Law of Trusts in Canada (3rd ed. 2005), at p. 362.

Where a transferee has received property for no consideration, the law presumes that they hold that property in a resulting trust in favour of the transferor. This is because “equity presumes bargains, not gifts”: Pecore at para. 24.

In Pavlovich v. Danilovic, 2019 BCSC 153 (aff’d 2020 BCCA 36), Justice Iyer, as she then was, recently discussed the law concerning resulting trust claims. She held:

… A resulting trust is presumed to arise in circumstances where a person gratuitously transfers property to another: McKendry v. McKendry, 2017 BCCA 48 at para. 35; Pecore v. Pecore, 2007 SCC 17 at para. 24. Unless the transfer takes place in certain family relationships (see Pecore at paras. 28, 30–33, 36), the law presumes that the transferor intended to convey legal title to the property but retain the beneficial interest. If the presumption of resulting trust applies, it is the transferee who bears the onus of establishing that a gift was intended: Modonese at para. 136; Pecore at para. 24.

When a property is purchased by one party but held in joint tenancy, there is a presumption that the transferor intended to retain the entire beneficial interest, including the right of survivorship, unless there is evidence to the contrary: see McKendry at para. 36; Bergen v. Bergen, 2013 BCCA 492 at para. 42; Baryla v. Baryla, 2019 BCCA 22 at para. 26–29.

The presumption of resulting trust also applies to gratuitous transfers of real property. This is so despite the statutory presumption of indefeasible title in the Land Title Act, R.S.B.C. 1996, c. 250: Fuller v. Harper, 2010 BCCA 421 at para. 43 (sub nom Fuller v. Fuller Estate). In Aujla v. Kaila, 2010 BCSC 1739 at paras. 32–37, Justice Harris concluded that if a transfer is gratuitous, the statutory presumption in s. 23(2) of the Land Title Act, that the party challenging the state of title has the burden of proof, can be discharged by the operation of the presumption of resulting trust: see also Modonese at para. 138–141; Zeligs Estate v. Janes, 2015 BCSC 7 at paras. 39–40; McKendry at para. 37.

In Pecore, the Court highlighted the importance of the resulting trust in situations, like here, where evidence regarding the transferor’s intentions is unavailable or unpersuasive. At para. 23, the Court held, in part:

For the reasons discussed below, I think the long-standing common law presumptions continue to have a role to play in disputes over gratuitous transfers. The presumptions provide a guide for courts in resolving disputes over transfers where evidence as to the transferor’s intent in making the transfer is unavailable or unpersuasive. This may be especially true when the transferor is deceased and thus is unable to tell the court his or her intention in effecting the transfer.

The transfer document signed by the victim provides that the consideration given by the defendant for his one-half interest in the Property was “$1.00 and natural love and affection”. “Natural love and affection” has been termed a formulaic phrase, one not determinative of whether value for a transfer was actually provided: Fleming v. Kwakseestahla, 2010 BCSC 1006 at para. 19; Pinsonneault v. Courtney, 2022 BCSC 120 at para. 168.

 

 

Undue Influence

 

In Davy v. Davy, 2019 BCSC 1826, Justice Gomery summarized the legal framework for the assessment of claims of undue influence:

The essential legal framework for the assessment of claims of undue influence was established in Allcard v. Skinner (1887), 36 Ch. D. 145 (C.A.) and confirmed in Geffen v. Goodman Estate, [1991] 2 S.C.R. 353 [Goodman Estate]. This framework is regularly applied in British Columbia; Turner v. Turner, 2010 BCSC 49 [Turner] at paras. 48-61 and 145-157; Modonese v. Delac Estate, 2011 BCSC 82 [Modonese] at paras. 96-129; Porter Estate v. Porter, 2015 BCSC 2354 [Porter Estate] at paras. 36-133; Cowper-Smith v. Morgan, 2016 BCCA 200 [Cowper-Smith] at paras. 39-40 and 48-53; Burkett v. Burkett Estate, 2018 BCSC 320 [Burkett] at paras. 187-217. It was not disputed in argument.

Undue influence is an equitable doctrine to save people from being victimized by other people. A transaction induced by undue influence may be set aside. There are two classes of case. The first class arises where the party seeking to set aside the transaction proves that the defendant engaged in improper conduct that dominated the will of the victim. That is not the plaintiff’s claim in this case.

The second class of case arises where the defendant and the supposed victim were in a relationship of dependency involving a potential for domination of the victim by the defendant. In these cases, if the transaction involved a gift or bequest, as opposed to a commercial transaction, undue influence is presumed and the burden lies on the defendant to show that the victim entered into the transaction as a result of his or her own full, free and informed thought. In the case of a commercial transaction, there is a further requirement: the plaintiff must also show that the contract in question worked unfairness by conferring undue disadvantage on the victim or undue advantage on the defendant.

Vulnerability and dependency are the hallmarks of undue influence: McMaster Estate v. McMaster, 2021 BCSC 1100 at para. 48.