Will In “Contemplation of Marriage” Not Revoked

Will In "Contemplation of Marriage" Not Revoked

Pace Estate 2016 BCSC 2306 held that a 2001 will left to “my common law spouse  of four years ” was not revoked by their subsequent marriage under what was then S 15 Wills Act that provided that marriage revoked a will. The parties married over a year  after the execution of the will.

The will did not expressly state that the will was being signed in ” contemplation ” of their marriage.

The parties signed mirror wills at the time leaving the residue of each of their estates to the other.

The parties separated a few years later and divorced in 2009. The effect of S. 16 of the Wills act invalidated the appointment of that spouse as executrix and as the recipient of the residue of his estate when he subsequently died in 2015. In fact he had been living with another spouse for about 2 years prior to his death and there was a dispute as to whether she was his spouse.

Since the introduction of WESA on March 31, 2014 marriage no longer does revoke a previous will.

It is not clear why the first spouse sought an order that the 2002 will had not been revoked by their subsequent marriage, but in any event the court held that it had not been revoked.

Extrinsic evidence was allowed and indicated to the court that the deceased clearly intended his will to be made in contemplation of his marriage even though it did not expressly state so.

The court followed the reasoning of the Court of Appeal in MacLean estate v Christianson 2010 BCCA 374 at paras 30-31 where the court held that it had the right to ascertain all the facts that were known to the testator at the time the will was signed so as to determine the intention.

They had arranged their affairs so that they were the named beneficiaries of each others pensions and insurance.

The court further held that the will could not have been rectified under the provisions of  59 WESA  as his death occurred after the coming into force of WESA  and new statutes are presumed to not have retrospective application where such statutes affect the substantive  rights of others R. Dineley ( 2012) SCJ #58.

The court declared to have held other wise would have frustrated the clear intent of the parties and have run afoul of the presumption against an interpretation that resulted in an intestacy.

The court held that under S 18 of the Wills act the will had been “revived” by showing a contrary intention  that the will had not been revoked by the  subsequent marriage.

Statute Barred Debt to Estate Deducted From Beneficiary

Statute Barred Debt to Estate Deducted From Beneficiary

Re Johnston Estate 2017 BCSC 272 upheld the rule in Cherry v. Boultbee  which provides that where a legatee of a share of the residue is a debtor of the estate, he or she is not entitled to receive his or her legacy without bringing his or her debt into account, even though the debt owed by the beneficiary in that case was 43 years old and was statute barred.

The rule derives from the case of Cherry v. Boultbee (1839), 4 My. & Cr. 442. It is an equitable principle designed to ensure fairness.

The purpose of the rule was to prevent a beneficiary who owed money to an estate from receiving more than his or her fair share of the estate.

In the case of Re: Akerman, Akerman v. Akerman, [1891] 3 Ch. 212, Kekewich J. stated:

A person who owes an estate money, that is to say, who is bound to increase the general mass of the estate by contribution of his own, cannot claim an aliquot share given to him out of that mass without first making the contribution which completes it. Nothing is in truth retained by the representative of the estate; nothing is in strict language set off; but the contributor is paid by holding in his own hand a part of the mass, which, if the mass were completed, he would receive back.

29      The rule has been held to apply even where the debt is statute-barred: see Re: Akerman.

30      The applicant submits that the rule continues to apply in Canada and relies on the decision of the Supreme Court of Canada in Canada Trust Company v. Lloyd et al, [1968] S.C.R. 300.

In that case, the Supreme Court applied the rule in Cherry v. Boultbee in finding that the contribution of three directors who had improperly withdrawn funds from the company some 43 years earlier, had to be taken into account in the distribution of the residue by the receiver. The court noted that the situation was analogous to that of a “legatee who must bring into account even a statute barred debt before he can claim a legacy left to him in the testator’s will”.

31      The applicant also relies on a more recent decision of the Ontario Court of Appeal, Olympia & York Developments Ltd. v. Royal Trust Co. (1993), 103 D.L.R. (4th) 129, where the court confirmed that the rule in Cherry v. Boultbee has been accepted in Canadian decisions and, where appropriate, applied.

The rule in Cherry v. Boultbee does not confer on the estate any right to recoup the amount owing but rather operates to ensure fairness in the distribution of an estate, recognizing that the relationship between a testator and his or her beneficiaries is typically not at arm’s length. The fundamental purpose of the rule is to ensure that beneficiaries are treated fairly and it embodies the principal that he who seeks equity must do equity. As the court noted in Re: Akerman, nothing is being retained by the representative and nothing is being set off but rather, the contributor is paid by what he is holding in his own hand.

The court in Re: Goy & Co Ltd., [1900] 2 Ch. 149, also noted that the claimant has in his own hands that which is applicable to the payment and should pay himself out of that. The question of whether the testator or the estate can recover the debt or whether the debt is statute barred is therefore largely irrelevant to the application of the rule. In my view, the change in approach to limitation provisions by the Supreme Court of Canada in Tolofson does not affect the application of the rule in Cherry v. Boultbee.

37      The decision of the Yukon Territory Court of Appeal in Leeper Estate makes it clear that the rule in Cherry v. Boultbee continues to apply in Canada.

39      The Estate of William Leonide Johnston is, however, entitled to retain and deduct from the share of the estate otherwise payable to the respondent an amount on account of the debt owed to the Estate of William Johnston by the respondent that was outstanding and owing on his death.

The Duty of Care Owed By a Will Drafter

The Duty of Care Owed By a Will Drafter

In Korpiel v Sanguinetti (1999) B.C.J. 1048 the court concluded that a will drafter, usually a solicitor or notary, owes no duty of care to beneficiaries beyond the competent and timely fulfillment of the testator’s testamentary instructions.

In the Sanguinetti case, the court considered whether a will drafter owed a duty to beneficiaries who had been named in a client’s former will.  The plaintiffs were relatives of an elderly testator who had instructed his lawyer to prepare a will bequeathing his home to the plaintiffs.  Some years later, the testator changed his mind and instructed the lawyer to draft a new will, leaving the plaintiffs only a small bequest.

The plaintiffs challenged the later will and brought a court action against the lawyer who drafted it for a breach of fiduciary duty owed to them.  Their claim was dismissed.

The court held that if a will drafter were to conduct him- or herself as proposed by the plaintiffs—that is, to refuse to follow the client’s instructions in preference to the interests the potential beneficiaries—it would be impossible for the will drafter to avoid a conflict of duty and interest.  If the will drafter were to be held to advocate for inclusion of persons or terms of disposition that were contrary to the specific instructions of the client, it would clearly result in a conflict with the will drafter’s primary duty to his or her client.  The court found such a situation would be untenable.

Thus a will drafter cannot owe an independent fiduciary duty to the beneficiary of a will, for if the testator’s instructions were to conflict with the beneficiaries’ interests, the will drafter would be unable to avoid conflicting duties to both parties.

In Smolinski v. Mitchell [1995] 10 W.W.R. 68 (BCSC), Sigurdson J. considered the question of the duty of a solicitor to his client, in contrast to the duty to others who may be deprived of an inheritance by reason of a solicitor’s failure to properly carry out his client’s instructions.  His Lordship quoted from the English decision of Ross v. Caunters [1979] 3 All E.R. 580, [1980] Ch. D. 297 at 322:

“The argument seems to me to confuse duties which differ in their nature. In broad terms, a solicitor’s duty to his client is to do for him all that he properly can, with, of course, proper care and attention.  Subject to giving due weight to the adverb “properly,” that duty is a paramount duty.  The solicitor owes no such duty to those who are not his clients.  He is no guardian of their interests.  What he does for his client may be hostile and injurious to their interests; and sometimes the greater the injuries the better he will have served his client.  The duty owed by a solicitor to a third party is entirely different.  There is no trace of a wide and general duty to do all that properly can be done for him.  Instead, in a case such as the present, there is merely a duty, owed to him as well as the client, to use proper care in carrying out the client’s instructions for conferring the benefit on the third party.”

The Alberta Court of Appeal in Graham v. Bonnycastle, 2004 ABCA 270 (leave to appeal to the S.C.C. refused, [2004] S.C.C.A. No. 489) came to a similar conclusion after an extensive review of the law.

In the Graham case the children of the testator had been equal beneficiaries under a 1984 will.  In 1994, after having been diagnosed with Alzheimer’s disease, the testator executed a new will, leaving a small bequest to each of his children and grandchildren and the residue to his new wife.  After the testator’s death the children commenced litigation challenging both the validity of the marriage and the 1994 will on the basis of lack of mental capacity, which any beneficiary is entitled to do.

Both of those actions were discontinued and a settlement agreement was entered into by the parties.  The children subsequently commenced an action against the solicitor who prepared the 1994 will claiming damages for the difference between the bequest they would have received under the original will and the benefits they received pursuant to the settlement agreement.

The Court of Appeal upheld the decision of the trial judge and dismissed the children’s claims on the grounds that the solicitor owed no duty of care to the children who claimed as beneficiaries under the original will, and that the original will had been revoked by both the subsequent will and the subsequent marriage of the testator.  (Note:  In British Columbia, prior to the enactment of the Wills, Estates and Succession Act on March 31, 2014, a subsequent marriage revoked an existing will but that is no longer the case.)

The court made it clear, however, that by extension of the principles set out in Hedley Byrne & Co. Ltd. v. Heller & Partners Ltd. [1963] 2 All E.R. 575, a leading House of Lords decision, a will drafter may be liable to an intended beneficiary who, as a result of the will drafter’s negligence, does not receive a benefit which the testator intended to grant.

Thus the general rule that a will drafter owes a duty of care only to his or her client and not to any third party, has been modified to include a duty to an intended beneficiary under a will who does not, as result of the will drafter’s negligence, receive a benefit which the testator intended to grant.  This has been labelled the “third-party beneficiary rule”.

The leading case is the House of Lords decision in White v. Jones [1995] 1 All E.R. 691 at 698-99 in which the court found a testator’s solicitor liable to an intended beneficiary for negligently failing to have the testator’s new will prepared and executed before the testator died.

Thus the only duty of care owed to an identified third-party beneficiary is where the will drafter owes a duty to the third-party beneficiary as well as the client, to use proper care and diligence in carrying out the client’s instructions for conferring the benefit on the third party.

In the Graham case the Alberta Court of Appeal held that the will drafter’s primary duty was to carry out the intentions of the testator, after being satisfied that the testator had testamentary capacity and recording his or her observations in that regard, so that the testator’s will would subsequently be admitted to probate.

The will drafter’s duty to ensure testamentary capacity coincides with the duty to ensure that the will accurately reflects the testator’s wishes.  A will drafter could never owe an intended beneficiary a duty of care that is inconsistent with his or her duty to the client. (Hall v. Bennett Estate (2003), 227 D.L.R. (4th) 263 (ONCA).

The imposition of a duty to beneficiaries under a previous will would create inevitable conflicts of interest for a will drafter that would be contrary to public policy.  A will-drafting solicitor or notary cannot have a duty to follow the instructions of his or her client to prepare a new will and, at the same time, have a duty to beneficiaries under previous wills whose interests are likely to be affected by the new will.

The BC Court of Appeal decision of Johnston v. Johnston Estate 2017 BCCA 59 followed the reasoning of both the Graham and Sanguinetti decisions in disallowing the claims of children who inherited under their father’s 2007 will that was modified against their interests by a 2012 will and a codicil thereto.

The testator’s children had been heirs under the 2007 will but were disinherited under the subsequent will, in which the testator left his entire estate to his new wife.

At trial the court struck out that portion of the plaintiff’s claim that alleged that the drafting lawyer owed the children a duty of care as beneficiaries under the 2007 will to, in effect, not carry out their father’s instructions to prepare a new will in terms inconsistent with the provisions of the 2007 will, finding that such claim was doomed to fail.  The Court of Appeal upheld that decision.

Therefore, the only duty a will drafter has to beneficiaries is to carry out the instructions of the will maker in a competent and timely manner.

Non Binding (Precatory) Words In Will Not a Trust

Non Binding (Precatory) Words In Will Not a Trust

Non Binding (Precatory)  words in a will were found not to create a trust that was legally binding on the trustee, but instead that the words were non binding ( precatory) and thus only morally binding an thus an outright bequest.

Killam v Killam 2017 BCSC 175  contains an exhaustive review of the rules of construction in deciding whether the following provision of a will creates a trust that is legally binding to use for the bequest for the health, support and maintenance” of the beneficiary, or whether the words “ it is my desire but I do not direct “are merely morally binding ( precatory) and not legally binding:

The provision in dispute is worded differently than those concerning the other relatives. It reads:

Provided HUMPHREY HUBBARD KILLAM should survive me, then in such event I give and bequeath ONE (1) SHARE to EUGENE HUMPHREY KILLAM, provided, should he predecease me, then to LAWRENCE HEBB KILLAM. It is my desire, however, I do not direct, that said share shall be used for the health, support and maintenance of HUMPHREY HUBBARD KILLAM, for as long as he should live or as long as said funds are available for such purpose.

After an exhaustive review of the rules of construction of the court concluded that the words do not form a trust for the beneficiary and instead is an outright bequest.

Precatory Language

63      Professor Waters, in his authoritative work, Waters’ Law of Trusts in Canada, 4th ed. (Toronto, Ont.: Carswell, 2012), provides an interesting historical context to what some have referred to as “precatory trusts”. He notes, first of all, that the prime question of whether a trust has been created is still one of construction (at 145):

The question which gives rise to most litigation is whether a testator intends to create a trust, or merely impose some kind of moral obligation upon the legatee when he bequeaths personalty or devises land in confidence that the legatee will use the property in certain ways. He may speak, for instance, of his “expectation”, “fervent wish”, “desire”, “firm belief” or “purpose” that this will be done. Such words may give rise to what has been called “a precatory trust”, though, as Rigby L.J. pointed out in the English Court of Appeal, and his words have been echoed in Canada, this title is awkward and incorrect; “a misleading nickname”. If language, once construed, is held to intend a trust, then whether the language is precatory or otherwise, the trust which is thereby set up is the same as any other express trust, and no different rules apply.

64      There was a profound shift in the judicial approach to these sorts of cases starting in the nineteenth century, caused by an English statutory change (at 145 – 147):

Prior to the latter half of the nineteenth century the courts bent over backwards to find that testamentary language of a precatory kind revealed the intention to transfer on trust. By imposing a binding obligation upon the recipient of the property, the wishes of the testator were held to be safeguarded, concerning those who were to benefit from his property. Moreover, before 1830, the executor in English law took the residue of the estate beneficially, if it were not otherwise disposed of; and where it was incumbent upon the executor to respect only the wishes, hopes, desires, and belief of the testator that others would be benefited, the temptation of the executor to ignore those moral obligations was considerable. Then, in 1830, that right of the executor was statutorily taken away, and thereafter, the pace picking up after 1870, the courts became gradually less inclined to discover trust intention in mere precatory words. It is generally agreed that the climate of judicial attitude changed noticeably with the case of Lambe v. Eames and Canadian courts have joined in this new attitude. In 1889, in Bank of Montreal v. Bower, Chancellor Boyd of the Ontario High Court Chancery Division stated:

It would be an otiose undertaking to go through all the cases, for they are numerous, and cannot be reconciled. But since Lambe v. Eames . . . . there has been a new departure in favour of confining language supposed to create a trust for the children [of the testator and the widow] within much narrower limits, than in some of the earlier cases. If the entire interest in the subject of the gift is given with superadded words expressing the nature of the gift, or the confident expectation that the subject will be applied for the benefit of particular persons, but without . . . terms cutting down the interest before given, it will not now be held . . . that a trust has been thereby created.

And in Johnson v. Farney, Meredith C.J.O. adopted the view of Cozens-Hardy M.R. in the leading English case of Re Atkinson that every care has to be taken not to make mandatory words from those which are the mere indication of a wish or request, and that to construe the true intention of the testator, the courts must examine the trust instrument as a whole and not be mesmerised by particular words. Earlier, in Renehan v. Malone, this same view had been expressed by Barker J. On many occasions, Trench v. Hamilton has been approved in Canadian courts. In that case, Lindley L.J. pointed out that the meaning which a court derives must prevail even if judges in the past have drawn different conclusions from more or less similar language.

65      Professor Waters concludes as follows (at 147):

Whether a trust has been created is simply a matter of construction; this principle has not changed. What has changed is the tendency found in the earlier cases to discover imperative meaning in various word formulae, like “wish and direction” or “trusting that” and expressions of that nature.

“Adopted Out” Child Cannot Contest Biological Parent’s Estate Under Wills Variation

"Adopted Out" Child Cannot Contest Biological Parent's Estate Under Wills Variation

Boer v Mikaloff Estate 2017 BCSC 21 confirmed that an “adopted out” child cannot contest the will of the biological parent’s estate under S.60 WESA (the wills variation provision) when it answered the following posed question negatively:

Does a child who is adopted by other parents after birth, but who is named as a beneficiary under his birth mother’s will, have standing to seek relief under section 60 of the Wills, Estate and Succession Act, S.B.C. 2009, c. 13?

4      For the reasons that follow, the answer to the question is no. The plaintiff’s claim will be dismissed.

RELEVANT STATUTORY PROVISIONS

6      The relevant statutory provisions are ss. 37(1) and (5) of the Adoption Act, R.S.B.C. 1996, c. 5, the definition of “enactment” in s. 1 of the Interpretation Act, R.S.B.C. 1996, c. 238 and s. 3 and s. 60 of WESA.

7      Subsections 37(1) and (5) of the Adoption Act read:

37 (1) When an adoption order is made,

(a) the child becomes the child of the adoptive parent,

(b) the adoptive parent becomes the parent of the child, and

(c) the parents cease to have any parental rights or obligations with respect to the child, except a parent who remains under subsection (2) a parent jointly with the adoptive parent.

. . .

(5) The family relationships of one person to another are to be determined in accordance with this section, unless this or another enactment specifically otherwise provides or distinguishes between persons related by birth and persons related by adoption.

8      Section 1 of the Interpretation Act defines “enactment”:

In this Act, or in an enactment: . . .

“enactment” means an Act or a regulation or a portion of an Act or regulation;

9      Sections 3 and 60 of WESA read:

3 (0.1) In this section, “pre-adoption parent” means a person who, before the adoption of a child, was the child’s parent.

(1) Subject to this section, if the relationship of parent and child arising from the adoption of a child must be established at any generation in order to determine succession under this Act, the relationship is to be determined in accordance with the Adoption Act respecting the effect of adoption.

(2) Subject to subsection (3), if a child is adopted,

(a) the child is not entitled to the estate of his or her pre-adoption parent except through the will of the pre-adoption parent, and

(b) a pre-adoption parent of the child is not entitled to the estate of the child except through the will of the child.

(3) Adoption of a child by the spouse of a pre-adoption parent does not terminate the relationship of parent and child between the child and the pre-adoption parent for purposes of succession under this Act.

ANALYSIS

17      Section 60 of WESA requires a will-maker to make adequate provision for the proper maintenance and support for the will-maker’s spouse and children that is adequate, just and equitable in the circumstances.

18      A “will-maker” is defined as “a person who makes a will”: s.1 of WESA.

19      A “spouse” is specifically defined for the purposes of WESA: ss. 1 and 2.

20      WESA does not define “child” or “children”.

21      Subsection 37(1) of the Adoption Act provides that when an adoption order is made, “the child becomes the child of the adoptive parent” and “the adoptive parent becomes the parent of the child”. Section 1 of the Adoption Act defines a “child” as “an unmarried person under 19 years of age”.

22      Our Court of Appeal in Clayton v. Markolefas, 2002 BCCA 435, addressed whether an adopted child was “issue” of her birth father enabling her to be entitled to a portion of her birth father’s intestate estate. The Court considered in detail, s. 37 of the Adoption Act as it then read. For the purpose of the case at bar, the changes to s. 37 of the Adoption Act at the time of Clayton and now are not significant.

23      Justice Esson (as he then was), stated:

[6] . . . — It will be seen that s. 37(1) [Adoption Act] retains the concept that upon the making of the adoption order the child becomes the child of the adoptive parent and the adoptive parent becomes the parent of that child. It goes on to provide, subject to an exception which has no application here, that the birth parents cease to have any parental rights or obligations with respect to the child.

[7] Section 37(1)(c) is, in my view, all-important in relation to the present issue. Because the birth parents cease to have any parental rights or obligations, it must follow that the child ceases to have any rights against the birth parents other than those defined in s. 37(6), i.e., rights which vested in the child before the date of the adoption order. The existence of s. 37(6) is inconsistent with a legislative intention to allow other rights of the child against the birth parent to survive the adoption order.

[8] Section 37(6) [should read 37(5)] of the new Act, which provides that the family relationships of one person to another are to be determined in accordance with s.37, also has a clear bearing on the present issue. The question whether a person is “issue” of another person is a matter of family relationships. The clear effect of s.37(1) is that the adoptive child becomes the child of the adoptive parent. From that it follows that all parental obligations fall upon the adoptive parents. It can therefore be said of the present provisions, as Seaton J.A. said of s. 11 of the former Act:

The thrust of these provisions is to move the child from one family to another family and make it a child of the new family and no longer a child of the old family.

Executor Can Waive Solicitor Client Privilege

Executor Can Waive Solicitor Client Privilege

Haas Estate v Jane Doe 2017 BCSC 12 confirmed that an executor( personal representative ) of an estate can waive any solicitor client privilege that existed prior to the deceased’s passing.

Mr. Haas died on February 15, 2016, leaving a will naming his only child, the plaintiff, Brigitte Marga Anne Stapleton, as his executor and sole beneficiary of his estate. 

2      Approximately four months before he died, Mr. Haas purchased an insurance contract for a premium of $100,000 and named the plaintiff as the beneficiary. However, approximately two months before his death, Mr. Haas changed the beneficiary designation on the insurance policy to a party or parties unknown  ( thus Jane Doe as a defendant). Around the same time, he consulted with a solicitor, Ms. Kirsten Okimaw, with regard to estate planning matters. No new will was prepared.

The application was whether the plaintiff was entitled to a copy of the solicitor’s file. The solicitor has thus far refused to turn over the file based upon advice she has received from a practise advisor with the Law Society of British Columbia that the file is or may be protected by solicitor-client privilege 

s. 142(1) of the Wills, Estates and Succession Act, which states :

142(1) A personal representative has the same authority over the estate in respect of which the personal representative is appointed as the deceased person would have if living, subject to

(a) a contrary intention appearing in the will of the deceased person, and

(b) this or any other enactment. 

15      The “wills exception” cases are those where the solicitor who took instructions and drafted the will was required to give evidence regarding communications and instructions between solicitor and client where the execution, contents or validity of the will were in issue, despite there being no waiver of privilege. The plaintiff refers to authorities where the wills exception has been expanded to include analogous transactions such as the creation of a trust (Geffen v. Goodman Estate, [1991] 2 S.C.R. 353), and production of an estate planning file where the deceased had transferred two pieces of property prior to his death (Kreeft v. Kreeft Estate, September 18, 2006, Kelowna Registry No. S64537). Courts have drawn a distinction between those cases where production of a solicitor’s file is sought to aid in the determination of the validity or interpretation of the will on one hand and an attempt to attack or vary the will where the intentions are clear and manifest on the face of the will on the other. 

24      One case which addressed the question directly was Hicks Estate v. Hicks, [1987] O.J. No. 1426. The parties to the action were relatives of the deceased, and at issue in the claim was whether certain transfers of property were valid. The plaintiff was the personal representative of the deceased who brought an application for production of the files of the deceased’s former solicitors. Stortini D.C.J. stated the issue succinctly at para. 12:

The privilege can be waived or lost by the client. In our case the client is dead. Who, therefore, is the repository of the privilege?

25      He then went on to answer his own question as follows at para. 15:

15. It is clear, therefore, that the privilege reposes in the personal representative of the deceased client who in this case is the plaintiff, the administrator of the estate of Mildred Hicks. The plaintiff can waive the privilege and call for disclosure of any material that the client, if living, would have been entitled to from the two solicitors.

26      A British Columbia case that addressed the rights of a personal representative to waive privilege is Romans Estate v. Tassone, 2009 BCSC 194, which involved the estate of an elderly man who shortly before his death transferred two assets to a friend and named his much younger caregiver as the executor and sole beneficiary in his will. The executor commenced an action against the deceased’s friend to set aside the conveyances and an applied for production of the conveyancing solicitor’s files. The named executor had not been granted probate as at the date of the application and her entitlement to probate was in dispute. The deceased’s former solicitor asserted privilege over the conveyance files. Savage J. held that the solicitor had properly refused to disclose the files and that it was appropriate that the executor prove her authority by producing letters of probate first. At para. 40, Savage J. held the following:

40. The authorities in my view make several matters clear: (1) an action can be commenced without obtaining probate, as an executor’s authority is based on the will, (2) before proceeding with an action already commenced, the parties to an action may require that the Plaintiff prove their authority by producing letters probate, (3) the court may require that a Plaintiff prove their authority, by producing letters probate, of its own motion, when appropriate and (4) the court may order a stay of proceedings any time after the commencement of an action where it is in the interests of justice to do so, pending the issuance of letters probate.

27      While the question does not appear to have been a matter of dispute, Savage J. at para. 41, confirmed that the solicitor-client privilege vests in the personal representative

Gifts to Witnesses: S. 43 WESA

Gifts to Witnesses: S. 43 WESA

Witnesses of a will and declares that such gifts are void, unless the court is satisfied that the will maker intended to make the gift to the person even S. 43 of  WESA governs the issue of gifts to though the beneficiary or his or her spouse was a witness to the will.

43 (1) Unless a court otherwise declares under subsection (4), a gift in a will is void if it is to

(a) a witness to the will-maker’s signature or to the spouse of that witness,
(b) a person signing the will by the will-maker’s direction, or the spouse of the person signing, or
(c) a person claiming under a person, other than the will-maker, referred to in paragraph (a) or (b).
(2) For the purposes of subsection (1), the relevant time for determining whether one person is the spouse of another is the time when the will was made.
(3) If a gift is void under subsection (1), the remainder of the will is not affected.
(4) On application, the court may declare that a gift to a person referred to in subsection (1) is not void and is to take effect, if the court is satisfied that the will-maker intended to make the gift to the person even though the person or his or her spouse was a witness to the will.
(5) Extrinsic evidence is admissible for the purposes of establishing the will-maker’s intention under subsection (4).

An express gift to an adult child would not be invalidated if their parent is a witness. It is only a witness or spouse of a witness whose gift gets invalidated.

It is likely that a statement of such intention in the will itself would provide adequate evidence of that intention to satisfy a court to declare the gift valid.

Wills Variation and Court Costs

Wills Variation and Court Costs

Two recent wills variation cases awarded the usual order of court costs to a winning party, namely Scale B.

In Dakin v Patry 2016 BCSC 1006 a plaintiff won a summary  trial and was awarded scale B .

In Ciarniello v James 2016 BCSC 1805 the plaintiff again won the trial and was awarded Scale B court costs.

The court in Ciarniello restated some case law re the usual orders in estate litigation depending on who was responsible for the court claim in the fist place.

4) Clearly the plaintiff was the successful party. However, in some circumstances costs in estate litigation are handled differently and this was generally described by Dardi J. in Massam Estate (Re), [2015] B.C.J. No. 1607, 2015 BCSC 1306, where she said at para. 49:

The costs analysis in certain types of estate litigation is informed by specific principles unique to estate litigation: Mawdsley v. Meshen, 2011 BCSC 923. For example, if the litigation was brought about or sprung from the will-maker’s own conduct — such as ambiguous wording in the will requiring an application to construe the will — the general judicial approach has been that all parties should be awarded their costs out of the estate: Lee v. Lee Estate (1993), 84 B.C.L.R. (2d) 341 (S.C.); Vielbig v. Waterland Estate (1995), 1 B.C.L.R. (3d) 76 (C.A.). Otherwise, the usual rule is that costs follow the event, so that the successful litigant is entitled to recover costs from the unsuccessful opposing party. The court, however, retains the discretion to order otherwise if the circumstances warrant it. Any discretionary exceptions to the usual costs rules must be made judicially: Bailey v. Victory (1995), 4 B.C.L.R. (3d) 389 (C.A.) at 393.

[5]             The leading case on the usual approach to costs in estate litigation is the Court of Appeal’s decision in Vielbig v. Waterland Estate (1995), 1 B.C.L.R. (3d) 76. Hinds J.A. referred to the decision of Master Horn in Lee v. Lee Estate (1993), 50 E.T.R. 297 at pp. 301-302 for the proposition that “where the validity of a will or the capacity of the testator to make a will or the meaning of a will is in issue, it is sometimes the case that the costs of all parties are ordered to be paid out of the estate”. However, quoting further from Master Horn he referred to litigation such as the case at bar where the issue was not the validity of the will or the testator’s capacity but the provisions directed to the support and maintenance of dependants and said in part:

But the case is different where the litigation does not relate to the validity of the will or the capacity of the testator or the construction of the will. Actions brought under dependants’ relief legislation presume the validity of the will and the capacity of the testator and that his intentions are clear. There are not doubts to be settled. The remedies provided by such legislation are directed to the maintenance and support of the dependants of the testator and are based on public policy. The legislation does not invalidate the will, it merely permits the court to vary the provisions made by the testator. So an unsuccessful action under such legislation cannot be said to have been caused by a testator, or to have been necessary to enable the estate to be distributed. The action does not benefit the estate.

[6]             Hinds J.A. continued at para. 45:

Here there was no question of the validity of the will, the testamentary capacity of the Testator, or of the meaning of the will. The Testator was not at fault in some way, thereby contributing to the appellant making an unsuccessful claim against his estate. In my view the general rule must prevail; costs should follow the event. …

[7]             There is no reason, exercising my discretion judicially, to make an order different from that sought by the plaintiff’s counsel. The plaintiff was successful. I was not shown any offers to settle by either party that showed the result was better than a result they were prepared to settle

BC Estate Litigator: Wills Variation and Long Marriages

Wills Variation and Long Marriages

Trevor Todd and Jackson Todd have over 60 years experience in litigating wills variation claims.

 

Ciarniello v James 2016 BCSC 1699 is a good example on how the court treats the division of estate assets  at the end of  long marriages when the survivor brings a wills variation action on the basis that she was not adequately provided for in her late husband’s estate.

The parties were together 39 years and had two children of their 28 year old marriage. It was a second marriage for both.

The deceased husband also had three children from a previous marriage.

The testator died at age 80 years and held assets in his name of about $11.3 million dollars.

His surviving spouse was aged 62 and owned about $7.2 million of her own assets but was essentially “land rich and cash poor” and was draining her saving each month to get by.

There was  evidence as to the valuations of each parties assets.

His will left his estate equally to his five children, other than his half in the family home which he left to the plaintiff.

There was evidence that the deceased sought and relied upon an estate plan but the court found that the plan was outside what was reasonable for the  long time spouse.

The court varied the will by % 25 of the residue to the surviving spouse plus the deceased’s  %10 interest in a privately  owned company and the remaining %75 to  be divided equally amongst the five children.

The court reasoned that the plaintiff was entitled in a notional separation had it occurred immediately prior to the testator’s death, and concluded that the deceased did not make adequate provision for his surviving spouse, and thus the variance. The notional separation defines the minimum acceptable level of what is adequate, just and equitable.

Under the will, the plaintiff did not receive one half of the family property and the testator clearly did not discharge his legal duty to her.

The Court:

[73]         The legal entitlement of the spouse immediately before the death of the testator is the relevant time, that is, the time of the notional separation, to determine the extent of the testator’s legal duty.

[74]         As Dr. Ciarniello died on April 28, 2013, the Family Law Act, S.B.C. 2011, c. 25, should govern the analysis. Given the provision of the Divorce Act and the Family Law Act, I think that the plaintiff at a time just prior to the death of the testator would likely be entitled to an equal division of family property. While I doubt that a family law analysis would have resulted in an order for spousal support, given the condition of the testator at that time, the deceased’s legal obligation would be to provide 50% of the family property.

[75]         Assuming a notional separation of the parties immediately before death, I find the relevant values at that time for the net assets of the plaintiff were $7,194,980 and for Dr. Ciarniello’s holdings $11,342,597. I have accepted the valuations in the plaintiff’s chart I set out above. I have considered the minority interest in Nicoson at the mid-point between the two valuations.

Copy of Will Probated

Copy of Will Probated

Under certain circumstances a copy of a will rather than the original, may be admitted to probate as the last valid will of the deceased.

The competing claimants will typically  argue that there is a presumption of revocation when the original will cannot be produced.

There is more information on this topic under my  blog heading of lost wills.

In short reasons for judgement, Canada Trust v MacMillan 2016 BCSC 1909 sets out a situation where the court was satisfied by evidence that the will maker executed a last will that had become lost due to changes in the law firms that held the will. Evidence was also led that she was mentally capable  at the time the will was signed, as it was argues she had suffered from mental illness for much of her life.

Canada Trust v MacMillan 2016 BCSC 1909

APPLICATION by bank for pronouncement of force and validity of last will of deceased in solemn form.

Gray J., In Chambers:

1      I am prepared to make the order requested. I will just give some very brief reasons for judgment.
2      Canada Trust is seeking a series of orders. The most important is a pronouncement for the force and validity of the last will of Joan Margaret MacMillan (“Ms. MacMillan”) dated November 5, 2002, in solemn form.
3      Ms. MacMillan passed away in March 2014 at the age of about 81 years. She had an estate which is presently worth a little bit more than two million dollars.
4      There were really three areas of concern that were addressed. The first is that the original signed will is not available. However, there is evidence that Mr. Argue was the lawyer who prepared the will. He was a lawyer with the law firm Owen Bird at the time he did the initial work on the will, and a few days later he started working at the law firm Campney & Murphy, and he was a lawyer with that firm when the will was executed.
5      A wills notice was filed saying that the will was kept at the law firm Campney & Murphy, but that law firm ceased operations, and the will was not found in the vault.
6      Two copies of the will were found, one in the deceased’s personal documents, and the other with Canada Trust, which was involved in referring Ms. MacMillan to Mr. Argue for preparation of the will. There was also an email from Mr. Argue to the Canada Trust officer who had been involved, saying that the will had been executed.
7      On the basis of all this, I am satisfied that the will was executed in compliance with the Wills Act formalities, even though we do not have the original will itself. We have the copy. It is appropriate with the correction in the name of the cousin, to Dorothy C. Anderson (“Ms. Anderson”). The name originally provided was Dorothy T. Anderson, but that name was incorrect.
8      The will itself provided that the residue would be distributed equally between Ms. Anderson and James V. Bennett, or to the survivor. In fact, Ms. Anderson predeceased the will maker. So pursuant to the will, it would be Mr. Bennett who would receive the entire residue of the estate.
9      Mr. Bennett was not a relative of the will maker. He met her in connection with doing some private investigation work for her. After that, he spent some time assisting her with chores, assisting her around the home, and having some social interaction with her such as lunches and teas and so on.
10      There was a concern about the will maker’s capacity to make the will. Ms. MacMillan had a history of mental illness. She suffered bipolar disorder, with episodes of depression and episodes of manic behaviour. She had some hospitalizations over the course of her lifetime. However, at the time of giving instructions and the execution of the will, she satisfied Ms. Taylor of Canada Trust and the lawyer, Mr. Argue, that she had testamentary capacity. She knew the extent of her estate. She knew that she had no living parents or siblings or children.
11      There is also the evidence of Dr. Sloan, a geriatric physician, and Dr. Hurwitz, a neurologist and psychiatrist, based on their review of medical records, all suggesting that the will maker had testamentary capacity. I am satisfied that Ms. MacMillan had the necessary capacity to execute the will at the time she did so.
12      A concern was also raised about undue influence. I have read Mr. Bennett’s affidavit, and I have not seen any evidence that suggests that there was undue influence.
13      Having considered all these things, I will make the orders sought and I am happy to initial the approved form of order.