BC Estate Lawyer-S. 58 WESA-Is It a Will?

Trevor Todd and Jackson Todd have practiced estate litigation for over sixty combined years , including S. 58 WESA claims as is the documents a valid will?

 

Section 58 WESA-“ Is It a Will”

 

Section 58 of Wills, Estates and Succession Act, SBC 2009, c.13 [“WESA”] has now been in effect in British Columbia for just over ten years. The purpose of this paper is to examine how this provision, perhaps the most “far reaching” of the WESA estate overhaul, has changed the estate litigation landscape. I venture to say that most non-legally trained people will find some of the recent s. 58 case law remarkable.

Section 58 WESA permits the court to allow a document to be fully effective as though it had been made as a will, where the court determines the document represents a deceased’s final testamentary intentions. Before WESA, documents that failed to strictly comply with the formal requirements of the Wills Act, R.S.B.C. 1996, c. 489 regarding the making, signing, and witnessing of a will were invalid.

The clear intent of s. 58 WESA is to allow the court to focus on what was the testator’s testamentary intention, rather than on technical deficiencies in the execution of the will. The court is permitted to give testamentary effect to a document, including one in digital form, that was not properly executed as a will, if the court is satisfied that the document represents the true testamentary intentions of the deceased.

The case law typically breaks down into two different scenarios with many variations:

  • Where will maker simply failed to comply with the formal requirements in completing a form such as proper execution-these are usually home – him made will situations; or
  • Where a third-party document is put forward is sufficient proof of the necessary intention to either make alter, revoke or revive a will-such as the lawyer’s file notes as to the will maker’s intentions.

The courts in several BC cases have stated that the closer the will comes to satisfying the formal requirements for complying with the proper execution of a will, the greater the chance is the court will apply s. 58 to cure it:

THE LAW

Simply put, section 58 of WESA permits the court to give testamentary effect to a document that was not properly executed as a will, if the court is satisfied that the document represents the testamentary intentions of the deceased.

The test to be applied became reasonably quickly settled in the two leading cases of by Estate of Young 2015 BCSC182 and Re Hadley Estate 2017 BCCA 311.

What makes these cases interesting is the myriad of facts that can leave one wondering if it could be a valid will.

 

 

Manitoba

The BC Courts have followed the reasoning of a Manitoba Court of Appeal case George v. Daily (1997) 143 DLR (4th) 273, which discussed at length the limits placed on a courts “curative powers” and held there must be a deliberate or fixed and final expression of intention as to the disposal of his/her property on death.

However, it must be established that the document(s) being propounded as a will was intended by the deceased to have testamentary effect. The court must therefore be satisfied on a balance of probabilities that the writing embodies the testamentary intent of the testator or testatrix.

The term “testamentary intention” means much more than a person’s expression of how he would like his/her property to be disposed of after death. The essential quality of the term is that there must be a deliberate or fixed and final expression of intention as to the disposal of his/her property on death: Bennett; Molinary v. Winfrey (1960), [1961] S.C.R. 91; and Canada Permanent Trust Co. v. Bowman, [1962] S.C.R. 711.

 

BC Law – Cured Wills

One of the leading cases on the curative powers of s.58 in B.C. involved curing pages of a memorandum done to a will and referred to as signed in the will, but the documents presented to the court were not signed.

Re Young Estate 2015 BCSC 182, which largely follows George v. Daily, held the memorandums disposing of personal effects were cured and formed part of the last will of the deceased.

…” 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:

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.

 

Re Hadley Estate 2017 311 confirmed the test set out two years earlier in Re Young. The case establishes:

  • British Columbia does not require a minimum level of execution or other formality to create a will;
  • a fixed and final intention does not mean an irrevocable intention;
  • the material time is usually when the document was created, but depending on the circumstances, a document may acquire a testamentary character by subsequent and sufficient manifestation of the will maker’s intention;
  • wide array of extrinsic evidence is admissible to illuminate the deceased’s state of mind and intentions; and
  • these issues are decided upon the civil standard of the balance of probabilities and are intensely fact specific.

 

IMPROPERLY” WITNESSED WILLS

Re Yaremkewich Estate 2015 BCSC 1124, was an uncontested application to cure the defects of improperly witnessed wills. In this particular case, the court found that the two witnesses to the will testified they signed as witnesses to a blank will template, that had no attached pages setting out bequests as was found  with the will after death. They could not recall if the deceased signed the will, at the same time as them.

For hundreds of years prior to WESA the court would have found the will to be invalid for failure of proper execution. Instead, the court followed section 58(3)(a), which empowers the court to order that a document or other record is fully effective as the will of the deceased person if the court is satisfied that the document represents the testamentary intentions of that deceased person.

The court was further satisfied as to the testamentary intentions by reason of detailed wordings and pages of attachments left by the deceased in an envelope entitled with the name of the deceased and declaring it to be her last will.

Extrinsic evidence is admissible on the question of testamentary intent, and the court is not limited to the evidence that an inspection of the document provides.

 

 

 

Computer Message

In Re Hubschi Estate 2019 BCSC 2040 an electronic document found on the deceased’s computer entitled “Budget for 2017” message was found to be a valid will. The word document stated: “get a will made out at some point. A5-way assets split for remaining brothers and sisters. Greg, Annette or Trevor as an executor.”

The court followed Re Hadley that there is no minimum level of execution or other formality for a testamentary document to be found fully effective.

The key question is whether the document records a deliberate or fixed and final expression of intention as to the disposal of the deceased property on death.


Signed Suicide Note

Gregoire v Cordani, 2020 BCSC 276 held that a signed but unwitnessed suicide note was remedied under section 58 WESA and held to be a valid will.

The note stated:

 

This is my will. Please respect my wishes.

Claude common-law husband gets my apartment and all its contents, and HSBC bank account

Michael brother gets all the rest RRSP account at HSBC

Stephen and Adam get nothing

Nobody, no doctors is to blame. Please be happy for me.

Signed- social insurance number

The court considered the following factors in reaching the conclusion the suicide note was a valid will, namely:

 

  • The document is referred to a will and states her intention that the

notice to be treated as such;

  • the note does not appoint an executor but specifically addresses the referred to parties to please respect my wishes. The court held that this is the direction to those parties to act on her behalf;
  • -the note was in the deceased’s handwriting, and signed by her;
  • the note was not witnessed, but it does refer to her depression and appears to be written in contemplation of taking her own life;
  • the note was found in a locked car by the place near where her body was found, indicating an intention that it be found;
  • the note was dated the same date that she went missing;
  • the deceased made specific bequests of major assets of her estate;
  • the notes stated, or social insurance number, bank account numbers and -the address of her apartment;
  • the language of the note as an air of finality;
  • she left nothing to her two other brothers and mother, which is consistent -with statements made to her common-law spouse husband; and
  • there are no allegations of testamentary incapacity or undue influence .

Lawyers Letters

Re McGavin Estate 2023 BCSC 819, the deceased, while in a rest home, met with her lawyers on two occasions. The lawyers in turn sent the client two letters confirming their instructions and asking for some clarifications or any possible changes that might be desired. The letters largely summarized the deceased’s assets and liabilities and her instructions for dividing her estate specifically amongst identified beneficiaries and specific purpose portions.

Covid struck and the client was not allowed visitors for the purpose of executing the will and while she told her lawyers that she did not wish to die intestate, she in fact appeared to do so.

The court found that the lawyer’s two letters of instructions for dividing up the estate were authentic, and they contained the full, final and fixed intention of the deceased for reasons that were included in the exchange of letters.


Unsigned/ Undated

Skopyk Estate 2017 BCSC 2335 cured an unsigned/undated will that varied an earlier will. The court found that the handwriting on the will was similar to other samples of handwriting produced.

The court was persuaded by the following extrinsic evidence:

  • it was pinned to a bulletin board in the apartment so it would be found;
  • The distribution was rational and the previous beneficiary had died;
  • directing the division of the residue in certain specific shares in mind with language that mirrored the language of the 1995 will;
  • although it was not signed or witness the word witness was written near the bottom;

 

  • -although the document was not dated, there was a reference at the top of the deceased will dated November 16, 1995, and it also corrected a typographical error in the 1995 will;

 

  • the handwriting was reasonably similar to handwriting in a letter entered and evidence; and

 

  • the day for heart surgery the deceased said he had been working on his well, and that his wishes were different from that of the 1995 will

 

Two Letters Changed the Will

In Re Noel Estate, 2023 BCSC 2473, a testator had a change of heart re a joint account held by her and the petitioner. She phoned and then wrote to her lawyer to change her will and the lawyer said it would be easier to prepare a letter to indicate her new intentions rather than doing a whole new will. The testator signed the letter in front of two witnesses.

The court found the letter to be authentic and to reflect the deceased’s intentions which she stated many times verbally and in the letter to more than one person. The court held that the letter altered the terms of the previous will.

 

White-Out Allowed

In Re Levesque Estate 2019 BCSC 927, the court found that the use of “white out” (and presumably a dark pen as well) to delete a gift in an existing will was a deliberate and considered act, which was validated under S.58 WESA.

 

CASES WHERE “THE CURE” REFUSED

Six Notes Refused

Re Lane Estate, 2015 BCSC 2162, set out for and against examination of the factors the court considered, and concluded that the six various documents did not form a valid will.

The factors supporting finding a will were:

  • the deceased used the formal language of “I, Elda Lane leave … to my son” in several of the notes;
  • some of the notes are signed at their end by the deceased;
  • the deceased told the petitioner she wanted him to have her house after she died and that she had left a note to that effect;
  • six of the notes contemplate a distribution of the estate by which the petitioner would receive all of the residue of the estate; and

 

  • the October 21, 2012 note identifies the property to be left to the petitioner as including the deceased’s principal assets, her house and the Scotiabank account.

Factors finding against a will were:

  • each of the notes is written on the back of a receipt, grocery list, calendar, or other scrap paper, suggesting impermanence and informality rather than a fixed and final intention;
  • none of the notes were witnessed.  They all lack one of the fundamental hallmarks of formal validity;

 

  • there is no express revocation of the deceased’s Will.  This case is distinguishable from Estate of Youngwhere the document admitted to probate was generally consistent with the deceased’s will;

 

  • none of the documents bear a title. Here there is no evidence that the deceased either showed or provided copies of her notes to anyone else;

 

  • the deceased appears to have made the December 15, 2014 and  January 9, 2015 notes at times when she thought she might shortly die.  By suggesting that the gift was contingent upon her imminent death these notes may not represent an expression of the deceased’s fixed and final testamentary intention.


No Final Testamentary Expression

Pulk Estate, 2018 BCSC 1321, dealt with a will done following major surgery and before the deceased’s death a few days later. A will was drafted following the surgery that purported to leave the deceased’s estate to his four siblings in equal shares. The will was not drafted by the deceased, and it was not signed by him prior to his death.

Contrary evidence was obtained where the best friend of the deceased told him he was going to leave everything to his daughter. The court found that the will did not represent a deliberate and final expression of the deceased testamentary intentions and refused to invoke the provisions of section 58 WESA to cure any deficiencies.

 

CONCLUSION

The critical issue in every section 58 will case is whether the document represents the deliberate or fixed and final intention of the deceased person as to his or her testamentary wishes.  The case law indicates that finality is the central concern.

It is obvious from the case law approving a curing of a will that the courts have allowed a very liberal interpretation as to what may got a valid last will.

Various factors have been considered section 58 applications, but no single factor is determinative, and could be given lesser more weight depending upon the circumstances in each case. For example, having a witness present to the execution of the will, will be given some weight by the court, and while British Columbia is not a substantial compliance jurisdiction, and has no minimal level of compliance needed, the absence of a signature or witness is not fatal to the will.

*Attention Reader: GET LEGAL ADVICE – It’s more complicated than you think*

The public is reluctant to pay a lawyer’s hourly rate to prepare what they invariably regard is a “simple” will. (Every notary/lawyer should know there is no such thing as a simple will).

Many lawyers have historically been prepared to prepare wills as a loss leader, but with increased overheads and consumer sensitivity to price,  there is friction in the area of preparation of wills, powers of attorney, representation agreements and other estate planning documents that, when combined with the information available on the internet, will cause many in the public to save on costs by preparing their own wills and other estate documents .

As the public becomes more aware of the curative provisions of WESA, they will become increasingly encouraged to prepare their own wills.

Most law firms that are economically viable in wills and estates now charge their hourly rate which is often much higher than the client is prepared to pay.

The curative provisions of WESA such as sections 58 and 59 were well-intentioned and generally are reasonable once the court is satisfied that the documents are authentic and reflect the final intentions of the deceased.

The problem essentially is that the legal test for mental capacity is a legal test, not medical, and the removal of the lawyer from the preparation of the will process is simply an unintended consequence  hat will ultimately lead to more contested “homemade” wills litigation, particularly in issues related to mental capacity, undue influence and wills interpretation.

BC Estate Lawyer- Joint Tenancy Severance

Jackson Todd and Trevor Todd have over sixty years experience in resolving estate disputes, including where a joint tenant’s conduct may sever the joint tenancy.

   JOINT TENANCY v TENANTS IN COMMON

 

Joint tenancy and tenancy in common are the two most common forms of concurrent property ownership in Canada.

In a joint tenancy, the “four unities” of title, interest, time and possession are present and co-owners hold an equal interest in the property as a unified whole. The common law treats joint tenants as a single tenant: each holding the whole for all, with no distinct shares held by anyone.

In contrast, in a tenancy in common one co-owner may hold a greater proportionate interest in the property than the other co-owner(s)

The principal and distinguishing characteristic of joint tenancy is the right of survivorship. When one joint tenant dies, his or her interest in the property is extinguished and passes to the surviving joint tenant(s) automatically by operation of law.

 

The right of survivorship is a revocable “expectancy” that manifests only upon success in the so-called “ultimate gamble” – survival – and then only if the joint estate has not been previously destroyed by an act of severance.

 

Unlike that of a joint tenant, a tenant in common’s interest in property remains intact upon death and passes into his or her estate

 

The Four Unities Required To Create a Joint Tenancy

 

  • Unity of title- means the title of each joint tenant arose from the same act or instrument.
  • Unity of interest -means their holdings are perfectly equal in nature, extent and duration.
  • Unity of time -means all the interests vested simultaneously.
  • Unity of possession -means each joint tenant has a right to present possession and enjoyment of the whole property, but no right to exclusive possession of any individual part of the whole.

Assuming all four unities are present, the question of whether a joint tenancy or a tenancy in common has been created is determined by the intention of the grantor.

 

 

SEVERANCE OF A JOINT TENANCY

 

A joint tenant is free to deal with his or her interest and may sever a joint tenancy, with or without the consent or knowledge of the other joint tenant(s).

After a joint tenant dies however, severance is no longer possible because death extinguishes the joint interest, thus a will cannot sever a joint tenancy: Bergen v. Bergen, 2013 BCCA 492 at para. 40;

 

When a joint tenancy is severed , the joint tenancy is converted into a tenancy in common and the right of survivorship is extinguished.

It is important to know that once the joint tenancy is severed it remains such and like a broken “ humpty dumpty” it can only be put together  by starting over and recreating the four unities.

 

As a consequence of severance each co -owner then becomes entitled to a  distinct share rather than an undivided interest in the whole. Bergen v Bergen 2013 BCCA 492.

 

              Severance Is “Typically” Affected In One of Three Ways:

 

1) By one person acting unilaterally ( and usually deliberately) upon his or her own interest, so as to destroy the four unities ( ie by transferring his or her interest to his or herself as provided for in the Property Act and the Law and Equity Act) ;

2) By mutual agreement, such as a written marital separation contract;

3) By any “ course of dealing” sufficient to intimate that the interests of all were mutually treated as constituting a tenancy in common- for example, conduct which demonstrates both tenants mutually dealt with their interests as several and separate.

The onus of proof rests on the party asserting the severance. McKee v .National Trust Co.(1975) 7 O.R (2d) 614 (CA).

There are several other modes of severance including but not restricted to bankruptcy, partition, and order made under matrimonial legislation.

The BC Court of Appeal in Bergler v Odenthal 2020 BCCA 175 confirmed that both a declaration of trust and a secret trust would have the effect of severing a joint tenancy. ( see also Public Trustee v Mee (1972) 2 WWR 424 where a bare trust declaration was held to sever a joint tenancy)

 

      

                                  SEVERANCE BY CONDUCT

 

The underlying rationale for a course of dealing, severing a joint tenancy is that it ensures that a right of  survivorship does not operate unfairly in favour of one owner, where the co-owners have demonstrated  through their conduct a  common intention to no longer treat their respective shares in the property as an indivisible unified whole.

The following are five courses of conduct between joint tenants that have resulted in a severance of their joint tenancy, sometimes without any knowledge or intention on their  part to have done so.

  1. Acrimonious Conduct between the Joint Tenants

 

In Preskar Estate v Wagner 20023 BCSC 80 a BC court found that a joint tenancy with a right of survivorship had been severed into a tenancy in common by reason of the joint owners acrimonious conduct to each  that was inconsistent with joint tenancy unity.

An unmarried  couple who owned their property in joint tenancy had acrimonious family litigation for many years, starting in 2007 that  never resolved. The joint tenancy was never severed and when Mr. Preskar  died, his interest in the joint tenancy property immediately went to his partner by right of survivorship.

The estate successfully sued arguing that their acrimonious course of conduct over many years of litigation showed that their “notional” unity of ownership under a joint tenancy had been abandoned, and thus the joint tenancy had been severed many years before his death in 2020.

The decision  meant that the half interest of the deceased would go to his estate rather than to the former joint tenant by right of survivorhip.

The BC court adopted the reasoning of the Ontario Court of Appeal as follows:

Hansen Estate v. Hansen, 2012 ONCA 112  dealt with spouses who separated and retained legal counsel, one party prepared  a new will,  and lawyers negotiated dividing  their joint assets, but one spouse died before the negations were completed.

The Appeal court held that even failed or uncompleted negotiations can lead to severance because “the negotiation of shares and separate interests represents an attitude that shows that the notional unity of ownership under a joint tenancy has been abandoned”.

 

 

  1. Agreement to Ultimately Pay the Sale Proceeds Into Two Separate Accounts

The Tessier v Tessier 2001 SKQB 399  cautions  that even the simple fact of retiring  parties signing an agreement to sell their  jointly owned property and pay the proceeds into separate accounts can by their conduct sever the joint tenancy into a tenancy in common.

The couple agreed to sell the property to a family member and prior to her death, the wife and husband had agreed that one-half of purchase price would be paid to each of them and the proceeds were to be maintained  in separate bank accounts .

These facts were sufficient indicia of destruction of unities of interest and possession, both by agreement and course of conduct.

 

  1. Partnership of Jointly Owned Property

 

In Garland v Newhouse 2021 BCSC 1291  ( upheld at 2022 BCCA 276) a partnership between non-spouses of a jointly owned property ran for profit or loss  was held to sever the joint tenancy when one of the partners died.

The parties had no personal relationship and had equally contributed to the purchase of the investment property, equally shared expenses associated with the property, and equally shared in profits derived. Their objective was to earn profit over time. They opened the joint bank account to manage the financial aspects of the business. The accounting records describe the arrangement as a partnership and individuals as partners.

The court found that there was in fact a partnership and that it was inconsistent with a joint tenancy with right of survivorship. Partners share profits and losses and the legal framework of a partnership is not compatible with the legal principles of a joint tenancy.

Where the property in issue is partnership property, there is a presumption that there is no right of survivorship as between partners, at least as concerns their beneficial interest in partnership assets:

Absent compelling evidence of a contrary agreement, a surviving partner holds legal title to property held in joint tenancy on trust for the surviving partner and the estate of the deceased partner: Agro Estate v. CIBC Trust Corp. (1999), 26 E.T.R. (2d) 314 at para. 44.

 

 

 

 

  1. Never Intended A Joint Tenancy

 

Lescano v Unlu 2016 BCSC 1535  – The court found that if the joint tenants ever were a couple their relationship ahd ended long ago, that at least one of the parties, if not both, did not understand the legal effect of a joint tenancy and did not want it from the outset. A hand written will prepared by one of the joint owners indicated that she wished her share of the property to go to her three children equally in the event of her death, and the survivor testifies neither of them ever did want a joint tenancy.

 

 

  1. Misuse of Power of Attorney

 

In  Zeligs v Janes 2016 BCCA 280 the BC Court of Appeal upheld a trial decision finding that a joint bank account was severed when one of the joint tenants withdrew funds from the joint account using a power of attorney that benefitted only herself.

In doing so the joint tenant automatically severed the joint fund and converted it into a tenancy in common thus extinguishing the right of survivorship.

 

            CONCLUSION

 

It is not exactly clear what evidence  and how much of it the courts may require in order to find that a joint tenancy has been severed by conduct, but it is certainly a growing area of law and the courts have shown a willingness to expand the area.

The courts are being presented with more and more fact patterns  of conduct where the co-owners have demonstrated  through their conduct a  common intention to no longer treat their respective shares in the property as an indivisible unified whole.

What is particularly interesting about this growth area of law is how uninformed the public and even the legal profession are about severance by conduct and  the possible significant financial and emotional consequences of their actions.

More importantly the lack of knowledge of a severance by conduct can lay dormant for many years until typically contested after death,  such as in the  Preskar Estate where the acrimonious behavior that severed the joint tenancy many years before was not reflected on the land title deed.

It will increasingly become the norm in matrimonial and estate litigation cases to explore whether in years past there was ever conduct between the joint tenants that might have severed their joint tenancy so that one half of the property is “ up for grabs” by the estate instead of going to the surviving joint tenant.

 

 

 

 

 

 

BC Estate Lawyer – Removing a Notice of Dispute

Trevor Todd and Jackson Todd have practiced estate litigation for over sixty years, including the filing and removal of Notices of Dispute.

Pursuant to Rules 25-10(10) and 25-10(11), the test to remove a Notice of Dispute is whether the filing of the notice is in the best interests of the estate: Richardson Estate (Re), 2014 BCSC 2162 at paras. 54, 58.

Rule 25 – Application to remove notice of dispute

(10)A person who is interested in an estate in relation to which a notice of dispute has been filed, including, without limitation, an applicant for an estate grant or for the resealing of a foreign grant, may apply on notice to the disputant for an order removing the notice of dispute.

Grounds on which notice of dispute may be removed

(11)On an application under subrule (10), the court may, by order in Form P31, remove a notice of dispute if the court determines that the filing is not in the best interests of the estate.

When notice of dispute ceases to be in effect

 

(12)  A notice of dispute in relation to an estate ceases to be in effect as follows:

(a)subject to paragraph (b), on the date that is one year after the date on which the notice of dispute was filed;

(b)if the notice of dispute has been renewed under subrule (6), at the end of the renewal period;

(c)if the notice of dispute is withdrawn by the disputant under subrule (9);

(d)if the will in relation to which the notice of dispute relates is proved in solemn form;

(e)if the court orders, under subrule (11) or otherwise, that the notice of dispute is removed.

In Stoker v Young 2024 BCSC 637 the objection to the ground raised by the Notice of Dispute pertained directly to the will’s validity and the validity of the estate grant which is sought. In the circumstances, it was necessary for the will to be proven in solemn form.

In  Martyniuk Estate, 2016 BCSC 2024, the court held that it was not appropriate to deal with an application to cancel a notice of dispute where more issues were at play than the administration of the estate, and in that case a summary trial was directed on the issue of spousal status.

Further, in the case of Schell Estate (Re), 2019 BCSC 2168,  the court held that where there are allegations of lack of testamentary capacity or allegations of undue influence, proof in solemn form is required.

BC Estate Lawyer – Court Costs and Full Indemnity

Trevor Todd and Jackson Tod have practiced contested estates for over sixty combined years, including dealing with contentious costs awards.

Re Chou Estate 2024 BCSC 481 dealt with the issue full indemnity for costs.

Full indemnity costs are generally awarded when one party is so successful at trial for what could be a number of reasons , that the court essentially says that the losing party must pay all the legal fees of the winning party, so that there is full indemnity.

Full indemnity costs are still subject to review to ensure their reasonableness, and an award of full indemnity costs is not a “blank cheque” ensuring recovery of all legal fees and disbursements, as Justice Donegan discussed in Hobbs v. Warner, 2020 BCSC 1180, at para. 12.

In Hobbs v. Warner, Donegan J. determined that it was appropriate on an assessment of full indemnity costs under the PPPA to adopt the approach taken on a review of a lawyer’s bill under the LPA, which requires the registrar to consider the factors set out in s. 71(4) of the LPA.

In reaching this determination, Donegan J. referred to two decisions of the Registrar of the B.C. Court of Appeal, although neither of them involve the assessment of full indemnity costs awarded in estate proceedings: Wanson (Bristol) Development Ltd. v. Sahba, 2019 BCCA 459 [Wanson], and Pallot v. Douglas, 2018 BCCA 315. Decisions of the Court of Appeal Registrar are not binding on the Registrar of the Supreme Court, but they provide helpful guidance.

In Wanson, Registrar Outerbridge contrasted full indemnity costs to special costs, determining that when assessing full indemnity costs, “the question is subjective: examining the bills of the solicitor in this matter, are the charges reasonable in the circumstances?” (para. 14). Justice Gibb-Carsley repeated this phrase in Mah Estate v. Lawrence, 2023 BCSC 1256, at para. 17 [Mah Estate] (an estate case, but one involving indemnity costs under an agreement).

In Mah Estate, Gibb-Carsley J. emphasized that s. 71 of the LPA (or an analysis akin to it) “does not require mathematical precision … instead, the assessor is entitled to employ a global approach to reach a ‘fair fee’ in the circumstances” and that “the costs awarded on a full indemnity basis must ultimately be ‘fair, reasonable and proportionate’” (para. 18).

In their written submissions, both parties agreed that it is appropriate to follow the approach Donegan J. adopted in Hobbs v. Warner, that is, that I should apply the s. 71(4) LPA factors when reviewing the bills on which the respondents’ full indemnity costs are based.

Section 71(4) of the LPA provides:

71 (4) At a review of a lawyer’s bill, the registrar must consider all of the circumstances, including
(a) the complexity, difficulty or novelty of the issues involved,
(b) the skill, specialized knowledge and responsibility required of the lawyer,
(c) the lawyer’s character and standing in the profession,
(d) the amount involved,
(e) the time reasonably spent,
(f) if there has been an agreement that sets a fee rate that is based on an amount per unit of time spent by the lawyer, whether the rate was reasonable,
(g) the importance of the matter to the client whose bill is being reviewed, and
(h) the result obtained.

Vancouver Estate Lawyer- Interim Distributions From the Executor

Trevor Todd and Jackson Todd have handled contested estates including obtaining interim distributions of estate for over sixty comb9ined years.

INTERIM DISTRIBUTIONS IN ESTATES

The court retains a general jurisdiction over the actions of executors/trustees and will normally require that a trustee discharge his or her duties with good faith, and with the standard of care of a reasonable and prudent person of business.

However, where a trustee is granted powers which are to be exercised at his or her sole discretion, the court traditionally would not interfere, unless the trustee had not turned his or her mind to the exercise of the discretion, or they had acted unfairly or in bad faith.

The case of Re: Blow Press Ltd. v U.S.W.A. (1977) O.R. (2d) 516 held that the court had jurisdiction to intervene in the exercise of a discretion by trustees in three situations:

1) a mala fide exercise of such a discretion;
2) a failure to exercise such a discretion; or
3) a deadlock between trustees as to the exercise of such a discretion

It is not uncommon for a will or a trust to be drafted with adjectives giving trustees “absolute,” “uncontrolled,” or “full discretion” to trustees, to use their authority. The courts traditionally have not interfered unless they found mala fides with respect to its exercise of such discretion.

In recent years, however, there are now a number of estate decisions in British Columbia that have allowed for interim distributions in certain circumstances, when the trustee is refusing to distribute under their discretion.

WESA
While WESA does not specifically allow for interim distributions of intestate estates, beneficiaries are no longer required to wait one year from the intestate person’s death to distribute the surplus of the personal estate, as was previously required by section 74 of the Estate Administration Act.

The executor can now distribute all forms of assets after 210 days have passed since the issuance of the representation grant, provided that no proceedings have been commenced, which might affect the distribution of the estate.

A new provision, section 155 (2) WESA prohibits a personal representative from distributing the estate after the 210 day waiting period without a court order if:

1) proceedings of been commenced as to whether a person is a beneficiary or intestate heir;
2) a variation claim has been brought; or
3) other proceedings have been brought, which may affect the distribution him.

INTERIM ESTATE DITRIBUTIONS GRANTED

Trustees generally have the right to exercise their discretion to refuse to make any interim distribution to the beneficiaries until their accounts are approved by the court, by way of a passing of accounts.

In Reznik v Matty 2013 BCSC 1346, an application was brought by three of four residual beneficiaries for an order directing distribution of $15,000 to each of them from the $50,000 held back in the estate. The executor of the estate was the fourth beneficiary, and it had been 13 years since the deceased will maker had passed away. The court held that the power given to the executor under the will to retain a portion of the estate did not displace the duty to distribute the assets.

In assuming general jurisdiction, Reznik was followed in 80 Wellesley St. East Ltd. v. Fundy Bay Builders Ltd., [1972] 2 O.R. 280 (C.A.), which stated at paragraph 282:
“As a superior Court of general jurisdiction, the Supreme Court of Ontario has all of the powers that are necessary to do justice between the parties. Except where provided specifically to the contrary, the Court’s jurisdiction is unlimited and unrestricted in substantive law in civil matters.”
The court reasoned that there was significant delay, and that the estate was of significant value and liquidity that the executors assent to the distribution was compelled, and thus the executor was ordered to pay $10,000 to each of the residual beneficiaries.
In Davis v Burns Estate 2016 BCSC 1982, the court held at paragraph 31 that the following criteria govern whether an interim distribution should be made:
a) the amount of the benefits sought to be distributed as compared to the value of the estate;
b) the claim of the beneficiaries on the testator;
c) the need of the beneficiaries for money; and
d) the consent of the residuary beneficiaries to the proposed distribution

In Davis v Burns, the applicant was 76 years of age and had been the deceased will maker’s common-law spouse for five years and had been friends with he and his wife for many years prior. The former spouse was bequeathed 20% of the assets of the estate (approximately $500,000).
The applicant had no funds and a negative monthly cash inflow. The court found that the other parties to the court action would not be prejudiced by an interim distribution to him, and so the court ordered an advance of $250,000, given his advanced age, and the will’s specific direction that he should “have fun” with the monies after her death.
Nykoryak v Anderson 2017 BCSC 1800 was a wills variation action that followed the criteria set out in Davis v Burns and ordered an interim distribution to each of the personal defendants from the estate funds in the amount of $50,000 each.
Each of the applications provided evidence of their financial need and hardship and the court found that the plaintiff’s security was still more than adequately protected from any award at trial.

In Re Zanrosso Estate 2021 BCSC 2928, the court commented that the new provisions of WESA did not directly address the possibility of court intervention, should an executor/trustee refuse or neglect to distribute the estate.

Counsel in this decision agreed that the court had general jurisdiction to order an interim distribution of estate assets and relied on Reznik v Natty as the authority.
The court found that it had authority to order a personal representative to make an interim distribution of an estate, further to its general jurisdiction and stating that such authority is discretionary and must be exercised in order to do justice between the parties.

The court referred to the criteria set out by the Court of Appeal in Hecht v Hecht 1991 BJ 3475, but stated that it was not an exhaustive list of potential considerations:
The court found that the factors to be considered by the court when deciding whether to exercise its discretion to grant leave to the executors include:

(a) the amount of the benefits sought to be distributed as compared to the value of the estate;
(b) the claim of the beneficiaries on the testator;
(c) the need of beneficiaries for money; and
(d) the consent of the residuary beneficiary to the proposes distribution.”

The court stated that since the legislator had not seen fit to expressly provide for interim distributions from an estate over the objection of the personal representative, that an order should only be made in exceptional circumstances, and with the burden on the applicant to justify the issuance of such an order.

In the case of Re Antonias Estate 2021 BCSC 2388, the court ordered an interim distribution where the applicants were the sole beneficiaries of the residue of the estate, sharing equally and were siblings ranging in age from 76 to 89 years of age, some of them with health issues, and some with concerns that they would pass away before the estate was distributed.
The executor did provide an offer to make an interim distribution, the same that was sought in the court order, but did so on the basis that a release would be signed and returned. The beneficiaries did not comply with the request to sign the release.

The applicants relied on the decision of Reznik v Matty and the quote of Austin v Beddoe (1893) that if an executor has assented to an interim distribution and the assets available to the estate after an interim distribution are sufficient to cover all outstanding liabilities, and had basically made that acknowledgement, it is appropriate to have assets released.
The court ordered the beneficiaries to indemnify the executor from any loss arising from the interim distribution in the event that there was an estate shortfall in assets verus liabilities.

The court ordered an interim distribution of $528,000 and noted that the estate holdback would be approximately $447,000 over and above executor’s fees of % 3.5.

CONCLUSION
Since approximately 2015, the British Columbia courts have been more willing to override the typical absolute discretion of a trustee as to whether or not to make an interim distribution. Historically, the courts would only interfere where there was mala fides on the part of the trustee before they would order a distribution of estate assets.
As the recent cases indicate, if there is evidence of an appropriate set of facts that “justice is done” by ordering an interim distribution, then the courts will seriously consider doing so.

Such evidence should consist of matters such as: inordinate delay, financial need, the advanced age of beneficiaries, holdback protection for the remaining beneficiaries’ interests, sufficient funds to pay future debts, with an indemnity from the beneficiaries in the event of a shortfall.
If such evidence is accepted by the court, then recent cases in British Columbia indicate that the court will give serious consideration to ordering an interim distribution of estate assets, if necessary over the objection of the executor/trustee.

As the court in the Zanrosso decision stated regarding the criteria set out by the Court of appeal in the 1991 Hecht decision – “this is not an exhaustive list.” This statement appears to indicate a greater willingness of the BC courts to order interim distributions of estate assets in appropriate circumstances.

BC Estate Lawyer- Gratuitous Transfers- Gift, Loan or Trust

Trevor Todd and Jackson Todd have practiced law re contested estates for over sixty combined years, including the thorny question of contested gratuitous transfers being either a gift, a loan or a trust.

GRATUITOUS TRANSFERS- LOAN, GIFT OR RESULTING TRUST?

The Gratuitous transfer of assets is a commonplace fact pattern in estate litigation. A small minority of purported gifts are substantiated as to the intention of the donor, which then forces the courts to assess the reliability of the evidence if any as to the intention of the donor why were the transfers made.

The issue of the intentions not being documented is probably most common in family transactions such as the proverbial “Bank of Mom and Dad”.

The most common forms of contentious transfers are made gratuitously through the use of joint tenancy, in both real property and investments such as bank accounts. By reason of the nature of the joint tenancy, upon the death of a joint tenant, the surviving joint tenant automatically becomes the registered owner of the property through the right of survivorship. This happens immediately upon death, and the asset does not form part of the estate of the deceased nor attract probate fees.

Such gratuitous transfers do however attract estate litigation, and the question for the courts to determine is whether the gratuitous transfer was a loan, a gift, or is subject to a resulting trust.

Determinations of whether a gratuitous transfer (usually real property) was a gift or resulting trust are more common in the courts than whether the advancement of funds was a loan or not.

Such cases are all fact determinative; the purpose here is to give an overview of the law relating to each of the three possible outcomes of inter-vivos gratuitous transfers.

WHAT IS A LOAN?

A loan is a specific form of contract. As such, it requires mutual concordance between the parties as to the existence, nature and scope of their respective rights and duties. Like other contracts, it may be evidenced orally, in writing, by conduct or by a combination thereof: Biehl v. Strang, 2011 BCSC 1373, paras. 326-330.

The essential elements of a loan were discussed. in Lee v. 1137434 Alberta Ltd., 2009 BCSC 284:

a principal sum;

i) ii) placed with a borrower;
ii) iii) on agreed terms for the payment of interest; and
iii) iv) liability on the borrower’s part for return of the principal with accrued interest. A loan has also been defined as delivery by one party and receipt by another of money on agreement, express or implied, to repay the money with or without interest:

WHAT IS A GIFT?

Generally speaking, a gift is a voluntary transfer of property to another without consideration. A true and proper gift is always accompanied with delivery of possession, and takes effect immediately.

This is opposed to a loan, which is a form of contract that involves mutual exchanges of obligations, the transfer by way of a gift involves a gratuitous unilateral transaction.
The central element of the gift is the intention of giving to another without any expectation of renumeration. The gift cannot be revoked by the donor or made void by another once the lawful property is vested.
For a gift there must be:
a) an intention to make a gift on the part of the donor, without consideration, or expectation of renumeration;
b) an acceptance of the gift by the donee; and
c) a sufficient act of delivery or transfer of the property to complete the transaction.

To make a valid gift the donor must have done everything that according to the nature of the property, was necessary to be done to transfer the property and make the transfer binding on the donor. McKendry v McKendry 2017 BCCA 48 at para. 31

The court will not perfect an incomplete gift. As a result, where there is a mere promise or unfulfilled intention, the court will not force the intended donor to complete the gift.
The standard for proving a gift is on the balance of probabilities.

WHAT IS A RESULTING TRUST?
A presumption of resulting trust arises where a person makes a voluntary transfer into the name of another person. This is because equity presumes bargains and not gifts.
The intention of the donor at the time of the transfer is key to determining whether the transaction gives rise to a resulting trust.

Generally this can be addressed by answering the following question: did the donor intend to make an immediate absolute gift or did the donor intend the transaction to be merely one of convenience. If it is the latter than the transferor is said to be holding beneficial title of the assets in a resulting trust for the donor

Where there is no consideration for a transfer the law presumes that the transferor intended to create a trust, rather than make a gift.

The legal presumption of resulting trust applies to most gratuitous transfers, but it is a rebuttable presumption of law. The party who obtains the benefit of the transfer must on the balance of probabilities rebut this presumption that the transferor intended to gift at the time of the transfer, or that there was evidence of the transferor’s contrary intention.

The leading case is Pecore v Pecore SCC 17.

The courts are primarily attempting to determine whether the intention of the donor at the time of the gratuitous transfer was to make a gift or has a resulting trust been created.
The court should only rely on the presumption of resulting trust where there is insufficient evidence to establish the transferor’s actual intent at the time of the transfer: Fuller v Fuller 2010 BCCA 421.

In Franco v. Franco Estate 2023 BCSC 1015, the court confirmed that if the transferee leads evidence showing that it is more likely than not that the transferor intended the transfer to be a gift, the presumption of resulting trust does not apply.

The presumption of advancement rebuts the presumption of resulting trust. Where a person makes a voluntary transfer to their spouse or minor child, it is presumed that the transfer was made with the intent of advancing the property to them, i.e., a gift. The presumption of advancement does not apply when a parent transfers property to an adult independent child. Recent case law indicates that it is increasingly questionable whether the presumption of advancement any longer applies to spouses.

CASES WHERE THE COURT FOUND A LOAN

Grenier v Williams 2020 BCSC 462 is a case where a daughter advanced $23,000 to her father to assist him in purchasing a property. Years later acrimony developed and there was litigation wherein the daughter alleged a loan and the father said it was a gift.
There was no documentation of the financial advancement. The court decided primarily on credibility that there was a loan and not a gift.

Weinhaupt v Paracy 2017 BCSC 1662 is a classic Bank of Mom and Dad situation except for that it was well documented. The apretyns advanced significant funds to a child and spouse in order to assist in the financing of the purchase of a home. The case law can be divided in terms of finding either a loan or a gift depending on the specific findings of fact that are largely based on evidence of the intention of the donors.

The more the transaction is documented the more likely the intention of the parties can be determined.
After reviewing the evidence, the court concluded that the funds were a loan and not a gift. There was contemporaneous documentary evidence of a loan, such as a promissory note, and security for the loan in the form of a mortgage. There was a reasonable expectation or likelihood of repayment once the property was sold.

The court cited Locke v Locke 2000 BCSC 1300 in determining whether it was a loan or a gift. (This passage from Locke was adopted by the Court of Appeal in Kuo v. Chu 2009 BCCA 405):

1. the presumption of advancement no longer applies between adult independent children and their parents;
2. between adult children and their parents, the presumption is a resulting trust when the parents make gratuitous transfers to children;
3. the court must consider all of the evidence in determining whether the parent intended the transfer as a gift or loan;
4. the factors to be considered are:
a) whether there were any contemporaneous documents evidencing a loan;
b) whether the manner for repayment is specified;
c) whether there is security held for the loan;
d) whether there are advances to one child and not to others, or advances of unequal amounts to various children;
e) whether there has been any demand for repayment before the separation of the parties;
f) whether there has been any partial repayment and whether there was any expectation or likelihood of repayment.

GIFT OR RESULTING TRUST?
Anyone who intends to make a gift of real or personal property for little or no consideration must ensure that the intention of the donor is well documented. A deed of gift given under seal, along with the statutory declaration of the intention to gift is probably the best evidence that the courts will rely upon.

If available, the most compelling evidence is direct evidence of the transferor’s intention at the time of transfer, but circumstantial evidence from that time is also important.
Post-transfer conduct is also relevant, but is typically treated in a cautionary manner by the courts as it may be self- serving in the reason for the change in intention.
The courts attempt to determine what the true intention of the transferor was when the gratuitous advancement was made. Only if it is not clear as to the intention do the presumption of advancement or presumption of resulting trust arise.
Where a parent makes a gratuitous transfer to an independent adult child, the presumption of resulting trust arises and the transferee must prove on the balance of probabilities that the transferor intended the transfer as a gift: Pecore v Pecore 2007 SCC 17 at paras 24-26.

CASES WHERE A GIFT WAS FOUND

Franco v Franco 2023 BCSC 1015

In March 2014, the deceased transferred monies into a joint account and real property to his third child. The court found that he did so with the intention of gifting the monies to the third child in order to defeat the claims of the first two children with whom he had an acrimonious relationship. Approximately 8 months later, the deceased executed a deed of gift confirming he had gifted one half of the property as a joint tenant to the third child. Affidavit evidence of independent parties confirmed that it was the intention to gift rights of survivorship in real property and bank accounts owned by him at the time he made the transfers. The court followed the reasoning of McKendry v McKendry 2017 BCCA 48 related to the requirements for a legally binding gift.
Wong v Huang 2012 BCSC 975

The plaintiff was an 86-year-old man who is suing his 12-year-old great nephew for the return of property that the plaintiff transferred to the defendant when he was six years old. The plaintiff was estranged from his children and changed his will in 2000 to provide for the defendant who had recently been born. In 2006 the plaintiff transferred his property into joint tenancy with the infant and wrote several letters to his family, explaining that he had gifted the property to the said child, and that he had changed his will to leave everything to him.
The plaintiff presumably had a change of heart and sued to have the property returned, but the court held that the plaintiff had intended to gift the property to the defendant, and thus the gift was not revocable.

CASES WHERE RESULTING TRUST FOUND
The case law seems to indicate that where there are undocumented gratuitous transfers of assets, it is more likely than not that the court will find a resulting trust unless there is clear evidence of intention to gift.

The presumption of resulting trust provides a guide for the courts in resolving disputes over transfers were evidence as to the transferor’s intent in making the transfer is unavailable or unpersuasive.

Flesjer v Butterfield 2019 BCSC 2332

A frail elderly and terminally ill mother of four children transferred all of her financial investments and real property to one of four children who was the most financially successful.
The court found that the mother did not intend to gift the property to that child. The transfer was done for two reasons – to avoid probate fees and because she trusted him as the most financially adept child to share the assets with his siblings. The court rejected the defendant’s defence that the monies were gratuitously transferred to him for payment of all of the services that he had provided to his mother over the years.

TLG v KMG 2019 BCSC 1236
This case involved a dispute between parents and their daughter with respect to the parents advancing $110,000 to assist the daughter in purchasing a home for her use. The parents won the case due to the law of resulting trusts.

The parents advanced $110,000 to their daughter in 2011 to buy a home. The parents stated that it was an investment for their retirement while their daughter said it was a gift. Neither of the parties sought legal advice or documented the arrangement.

The property was registered as to an undivided 99/100 interest in the name of the daughter and an undivided 1/100 interest in the names of the parents.
The parents stated that they trusted their daughter, but in hindsight their evidence at trial was that it was a mistake.
The parents paid a contractor to renovate the basement suite and paid for the appliances. They used funds from their RRSPs to do so, and thus incurred tax consequences for withdrawing the funds.
The matter came to a head after five years when the parents informed the daughter that they wished to sell the property as they had a large tax bill to pay because of the RRSP withdrawals.

In response, the daughter told her parents “No,” and that “it was her house”.
The court found that the parents had been financially supportive of the daughter for many years and had given her a lengthy education. That history of support and its nature, weighed against the daughter’s assumption that the funds the plaintiffs advanced for the purchase of the property was a gift.
The court found that the daughter had failed to rebut the presumption of resulting trust, so the court ordered the property sold and that the defendant held her interest in the property as trustee for the plaintiffs.

CONCLUSION

Disputes frequently arise in estate litigation as to whether gratuitous transfers were a loan, a gift or a resulting trust. This is often the case in family situations which invariably are not documented nor is independent legal advice obtained.

The law is reasonably well settled as to what is a gift, a loan and a resulting trust and the courts have certain presumptions that they will rely upon when it is not clear as to what the intention of the donor was when the gratuitous transfers were made. The overall conclusion is that donors should obtain legal advice and properly document gratuitous transfers as to their intention.

Contested Estates In BC- Removing an Executor

Trevor Todd and Jackson Todd have over sixty years experience in handling contested estate disputes including  removing an executor or trustee

An executor may be removed and replaced under ss. 158–159 of the WESA, and a trustee may be removed and replaced under ss. 30–31 of the Trustee Act. The tests for removal of an executor and of a trustee are substantially the same. The WESA and the Trustee Act do not vary the bases on which the Court has inherent jurisdiction to remove or replace an executor or trustee.

The basis on which the judicial discretion to remove is to be exercised is well-established and has been cited in many cases.

The leading authority continues to be Conroy v. Stokes, 4 D.L.R. 124, 1952 CanLII 227 (B.C.C.A.). In Conroy, the Court considered removal and replacement of a trustee because some of the beneficiaries were dissatisfied with the trustee’s handling of the estate. Citing Letterstedt v. Broers, 9 App. Cas. 371, [1884] UKPC 1, the Court confirmed that the main consideration is the collective welfare of the beneficiaries: Conroy at 126.

A court will not lightly interfere with a testator’s choice of trustee: Nieweler Estate (Re), 2019 BCSC 401 at para. 27 [Nieweler Estate], and not every actual or perceived conflict should lead to disqualification of a trustee or an executor: Conroy at 126–127; Burke v. Burke, 2019 BCSC 383 at para. 43. Mere friction between the trustee and one or more of the beneficiaries is usually insufficient to justify removal of the trustee: Miles v. Vince, 2014 BCCA 289 at para. 84.

Perfection is not expected of an executor or trustee: Dahle Estate (Re), 2021 BCSC 719 at para. 22. The question is whether the trustee’s acts or omissions endangered the administration of the trust: Carpino v. Carpino, 2022 BCSC 2237 at para. 51, citing Parker v. Thompson (Trustee), 2014 BCSC 1916 at para. 37; see also Burke at para. 29.
To remove an executor or trustee for misconduct, the evidence must show they endangered estate property, acted dishonestly and without proper care, lacked capacity to execute their duties, or acted without reasonable fidelity: Conroy at 127; see also Nieweler Estate at para. 33.

Deciding whether to remove an executor or trustee involves considering all the facts, and the context, out of respect for a will-maker’s choice of executor, the court should not interfere except for good reason or, as some cases have said, where doing so is “clearly necessary”: Mardesic v. Vukovich Estate, 30 B.C.L.R. (2d) 170, 1988 CanLII 3125 (S.C.) at paras. 18–19; Burke at paras. 29, 31.
The development of the principles for removal was summarized by the Court of Appeal in Miles at paras. 84–86:

[84] What circumstances justify the removal of a trustee? In Letterstedt …, the court established guidelines justifying the removal of a trustee (at 385-389):

1. If the Court is satisfied that the continuance of the trustee would prevent the trusts being properly executed, the trustee might be removed. It must always be borne in mind that trustees exist for the benefit of those to whom the creator of the trust has given the trust estate.
2. The acts or omissions must be such as to endanger the trust property or to show a want of honesty, or a want of proper capacity to execute the duties, or a want of reasonable fidelity.
3. In exercising the delicate jurisdiction of removing trustees, the Court’s main guide must be the welfare of the beneficiaries. It is not possible to lay down any more definite rule in a matter that is so “essentially dependent on details often of great nicety.” The Court must proceed to look carefully into the circumstances of the case.
4. Where a trustee is asked to resign, and if it appears clear that the continuance of the trustee would be detrimental to the execution of the trusts, even if for no other reason than that human infirmity would prevent those beneficially interested, or those who act for them, from working in harmony with the trustee, and if there is no reason to the contrary from the intentions of the framer of the trust to give this trustee a benefit or otherwise, the trustee is always advised by his own counsel to resign.
5. The lack of jurisprudence in respect of the removal of a trustee reflects that a trustee when asked to do so, will resign.
6. If, without any reasonable ground, the trustee refuses to do so the court might think it proper to remove him.
7. Friction or hostility between trustees and the beneficiary is not of itself a reason for the removal of the trustees. But where the hostility is grounded on the mode in which the trust has been administered, where it has been caused wholly or partially by substantial overcharges against the trust estate, it is not to be disregarded

In Fitzgerald v. Hill, 2022 BCSC 968, despite almost all the beneficiaries seeking to have the executor and trustee removed and a finding that the executor and trustee should have performed his duties in a more cooperative and open manner, Justice Coval did not order removal. He found no endangerment to the estate assets and that no preferential treatment or hostility interfered with the proper administration of the estate.

There is a  high threshold that must be met for a removal order and  each case turns on its own particular facts and the context of the estate in issue.

Vancouver Estate Lawyer- Lost Wills and The Presumption of Destruction

Trevor Todd and Jackson Todd have over sixty years combined experience in handling estate disputes, including lost wills and the presumption of destruction.

 

Facts of Re Finsant estate 2024 BCSC 217

The deceased died at the age of 81 years in her home. Searches of the home and her personal effects did not find a will. It was known that she had executed a will, almost 20 years earlier, and that the deceased had possession of it. She lived alone, and had no children or surviving siblings and her home was reasonably orderly.

The court found that she appeared to be mentally competent.

The estate dispute was between the named beneficiaries in the will and her next of kin on an intestacy.

 

Under these circumstances, the court found that she had either intentionally destroyed the will or was lost, stolen or accidentally destroyed.

There is a presumption of destruction of the will that the court found had not been rebutted, and that she must be presumed to have died intestate.

 THE LAW

The presumption of destruction was set out in Welch v. Phillips (1836), 1 Moo PC 299 at p. 302, and remains the law in British Columbia: Haider v. Kalugin, 2008 BCSC 930, at para. 11. If, as here, a will is traced to the possession of the deceased and last seen there and is not forthcoming on death, it is presumed to have been destroyed by the deceased, a presumption that holds unless there is “good and sufficient reason to repel it.”

In modern Canadian civil law, there is only one standard of proof in civil cases regardless of the nature of the allegation, namely, proof on a balance of probabilities: F.H. v. McDougall, 2008 SCC 53, at para. 40. But the quality of the evidence necessary to make a finding on that standard will depend on the inherit probabilities or improbabilities: McDougall; Canada v. Fairmont Hotels Inc., 2016 SCC 56, at para. 36.

As Justice Ehrcke explained in Thierman Estate v. Thurman, 2013 BCSC 503 at para. 43:

The presumption [of destruction] recognizes that the burden of proof is on the party attempting to rely on a non‑original copy of a will. Thus, the presumption of destruction of a will that had been in the testator’s possession but cannot be found on his death may be rebutted by evidence establishing on a balance of probabilities that the will was inadvertently lost or misplaced.

 

The ultimate issue is whether, on a balance of probabilities, the will was more likely to have been deliberately destroyed because the testator had a change of heart or was more likely lost, stolen or accidentally destroyed. The legal onus is on the applicant – in this case Ms. Beggs – as the person trying to rely on a non‑original copy. What the presumption adds is the common‑sense point that we would expect a person who wants a will to be executed to keep it where it can be found when they die. In the absence of a contrary reason, this is the more inherent probability. The application of the legal standard and burden of proof will take this into account.

In other words, if a will in the deceased’s possession cannot be found after a reasonable search, the quality of evidence necessary to support the inference that it was destroyed intentionally is less than that required to support the inference that it was lost or inadvertently destroyed.

At para. 13 of Haider,  the court set out the factors typically looked at in deciding whether the presumption of destruction has been rebutted as follows:

 

  • whether the terms of the will itself were reasonable;
  • whether the testator continued to have good relationships with the beneficiaries in the copy of the will up to the date of death;
  • where personal effects of the deceased were destroyed prior to the search for the will being carried out;
  • the nature and character of the deceased in taking care of personal effects;
  • whether there were any dispositions of property that support or contradict the terms of the copy sought to be probated;
  • statements made by the testator which confirm or contradict the terms of distribution set out in the will;
  • whether the testator was of the character to store valuable papers, and whether the testator had a safe place to store the papers;
  • whether there is evidence that the testator understood the consequences of not having a will, and the effects of intestacy;
  • whether the testator made statements to the effect that he had a will;

 

 

BC Contested Estates- The Criteria For Removing an Executor

Trevor Todd and Jackson Todd have over sixty years combined experience in handling contested estates, including the removal of executors.

The law relating to the removal of an executor was summarized in Nand Estate (Re), 2022 BCSC 1718 and followed in Re Walker Estate 2024 BCSC 250.

The Court has power, under both s. 30 of the Trustee Act, R.S.B.C. 1996, c. 464 as well as its own inherent jurisdiction, to make an order removing a trustee: Dirnberger Estate, 2016 BCSC 439 [Dirnberger Estate] at para. 9, citing Morelli v. Morelli, 2014 BCSC 106 at para. 29.

Section 158(3) of the WESA allows the Court to remove a person entitled under a will from being a personal representative in the circumstances enumerated in that section. Subsection 158(3)(f)(iii) allows for removal where the personal representative is:

(iii) otherwise… unable to or unreasonably refuses to carry out the duties of a personal representative,
to an extent that the conduct of the personal representative hampers the efficient administration of the estate

Notwithstanding that jurisdiction, courts are very hesitant to interfere with the discretion of the will-maker to remove an Executor. To do so, good reason must be shown for believing that the interests of a person entitled under the will are in danger: Re: Estate of Andre Jacques Blitz, Deceased, 2000 BCSC 1596 at para. 20.

Indeed, in deciding whether to remove an estate’s trustee, the Court’s main guide should be “the welfare of the beneficiaries”: Crawford v. Jardine, 1997 O.J. No. 5041 (Ont. Ct. (Gen. Div.)) at para. 18.

In Dirnberger Estate, at para. 11, the Court set out the four categories of conduct on an Executor’s part that will warrant removal as follows:
a) endangerment of the trust property;
b) want of honesty;
c) want of proper capacity to execute the duties; and
d) want of feasible fidelity.

In Parker v. Thompson (Trustee) 2014 BCSC 1916, at paras. 35 to 43, the Court added “actual dishonesty” and “lesser basis of a trustee’s ability to act impartially” as bases for removing a trustee.

It also reiterated the removal of a trustee “should not be lightly entertained”, and citing Radford v. Radford Estate, 2008 CarswellOnt 5297, 43 E.T.R. (3d) 74, set out a number of other considerations to apply when considering an application for the removal of a trustee. They are:

• removal must be the only course to follow;
• non-removal must likely prevent the proper execution of the trust; and
• removal is not intended to punish for past conduct.

The existence of friction between a trustee and one or more of the beneficiaries is usually not sufficient, of itself, to justify the removal of the trustee: Dirnberger Estate at para. 10, citing Erlichman v. Erlichman, 2000 BCSC 173 at para. 8.

Vancouver Estate Lawyer – Gratuitous Transfer Is Gift

vancouver estate lawyer

Trevor Todd and Jackson Todd have over sixty years combined experience in handling contested estates , including gifts versus resulting trust claims.

Franco v Franco Estate 2023 BCSC 1015 held that the gratuitous transfer from a father to one of three children was a valid gift having found that the deceased clearly intended the transfer of properties and a joint bank account to be a gift.

The presumption of resulting trust was rebutted.

Documentary and affidavit evidence established that the deceased intended to gift to his daughter rights of survivorship in real property and bank accounts owned by him at the time he made those transfers. That evidence includes the transfer documents, the Deed of Gift and bank account documents, as well as the affidavits of independent witnesses.

The Law

In McKendry v. McKendry, 2017 BCCA 48, the Court of Appeal stated the requirements for a legally binding gift:

A gift is a gratuitous transfer made without consideration. Two requirements must be met for an inter vivos gift to be legally binding: the donor must have intended to make a gift and must have delivered the subject matter to the donee. The intention of the donor at the time of the transfer is the governing consideration. In addition, the donor must have done everything necessary, according to the nature of the property, to transfer it to the donee and render the settlement legally binding on him or her: Kooner at 79-80; Pecore at para. 5.

A gift may be delivered in various manners. For example, a donor may choose to transfer property directly to a donee or a trustee, or may retain possession and make a declaration of trust. Once a gift is given, the donor cannot retract it. If it is incomplete, however, the court will not perfect a gift. Accordingly, where the gift rests merely in a promise or unfulfilled intention, the court will not compel an intending donor to follow through with making the gift: Kooner at 79-80; Pecore at para. 56.

The standard for proving a gift is the usual civil standard of a balance of probabilities: Singh Estate v. Shandil, 2007 BCCA 303 at paras. 24-27.

Where, as in this case, a parent makes a gratuitous transfer to an independent adult child, the presumption of resulting trust arises and the transferee must prove on a balance of probabilities that the transferor intended the transfer as a gift: Sandwell v. Sayers, 2023 BCCA 147 at paras. 39-41, citing Pecore v. Pecore, 2007 SCC 17 at paras. 24-26, 44.

In Newhouse v. Garland, 2022 BCCA 276 at paras. 54-56, the Court of Appeal clarified that the presumption is engaged only where there is insufficient evidence to displace it.
That is, if the transferee leads evidence showing that it is more likely than not that the transferor intended the transfer to be a gift, the presumption does not apply: Pecore at para. 59.

If available, the most compelling evidence is direct evidence of the transferor’s intention at the time of transfer. Circumstantial evidence from that time is also important. While post-transfer conduct is also relevant, it should be treated with caution because of the danger that after-the-fact evidence may be self-serving or may reflect a change in intention: Pecore at para. 59.