Wills Variation and Discretion

Wills Variation and Discretion

One of the difficulties in advising clients in wills variation cases is that under the WESA provisions relating to the variance of wills, the trial judge has an absolute discretion in his or her award, if any, under the act. The five panel appeal decision of Kish v Doyle and Sobchak 2016 BCCA 65 dealt with the wills variation court  action of two parties who met late in life,  had children from previous marriages and did not wish to be treated as spouses.

In the course of their judgment, they examined  the fine line between the exercise of judicial discretion and the finding of facts , as well as the standard of review to the exercise should judicial discretion  on appeal.

Exercise of Discretion

[33]      The line between the exercise of judicial discretion and the finding of facts is not easy to enunciate. For purposes of this case, I respectfully adopt Lord Bingham’s description of judicial discretion given in The Business of Judging: Selected Essays and Speeches (2000):

According to my definition, an issue falls within a judge’s discretion if, being governed by no rule of law, its resolution depends on the individual judge’s assessment (within such boundaries as have been laid down) of what it is fair and just to do in the particular case. He has no discretion in making his findings of fact. He has no discretion in his rulings on the law. But when, having made any necessary finding of fact and necessary ruling of law, he has to choose between different courses of action, orders, penalties or remedies he then exercises a discretion. It is only when he reaches the stage of asking himself what is the fair and just thing to do or order in the instant case that embarks on the exercise of a discretion.

I believe this definition to be broadly consistent with the usage adopted in statutes. [At 36; emphasis added.]

Lord Bingham also explains that fact-finding is not “discretionary”, although some judges have described it as such. In his words:

… it is one thing to say that the responsibility of finding the facts is entrusted to a particular person or body, be he judge, arbitrator, official or public authority, and that such finding is to be treated as conclusive or virtually so. But it is quite another to describe that function as discretionary. It is, I suggest, nothing of the kind. In finding the facts the judge’s job is to consider all the conflicting evidence this wav and that and decide as best he can where the truth lies. It is very much the task performed, for instance, by the historian or the journalist as part of his stock in trade. The judges of course are constricted by formalities and rules of evidence which do not afflict them.

On the other hand, he has powers of compelling testimony which they would envy. It is none the less essentially the same function. Yet to say of a historian or journalist that he exercised a discretion in reaching conclusions of fact would, I suggest, be regarded as a libellous. The judge must exercise judgment, not discretion, in finding the facts, and it is usually the most difficult and often most exacting task which the civil trial judge has to undertake. [At 37; emphasis added.]

[34]      The standard of review applicable in Canada to the exercise of judicial discretion is found in Friends of the Oldman River Society v. Canada (Minister of Transport) [1992] 1 S.C.R. 3. There La Forest J. wrote for the majority:

Stone J.A. cited Polylok Corp. v. Montreal Fast Print (1975) Ltd., [1984] 1 F.C. 713 (C.A.), which in turn approved of the following statement of Viscount Simon L.C. in Charies Osenton & Co. v. Johnston, [1942] A.C. 130, at p. 138:

The law as to the reversal by a court of appeal of an order made by the judge below in the exercise his discretion is well-established, and difficulty that arises is due only to the application of well-settled principles in an individual case. The appellate tribunal is not at liberty merely to substitute its own exercise of discretion for the discretion already exercised by the judge. In other words, appellate authorities ought not to reverse the order merely because they would themselves have exercised the original discretion, had it attached to them, in a different way. But if the appellate tribunal reaches the clear conclusion that there has been a wrongful exercise of discretion in that no weight, or no sufficient weight, has been given to relevant considerations such as those urged before us bv the appellant, then the reversal of the order on appeal may be justified.

That was essentially the standard adopted by this Court in Harelkin v. University of Regina, [1979] 2 S.C.R. 561, where Beetz J. said, at p. 588:

Second, in declining to evaluate, difficult as it may have been, whether or not the failure to render natural justice could be cured in the appeal, the learned trial judge refused to take into consideration a major element for the determination of the case, thereby failing to exercise his discretion on relevant grounds and giving no choice to the Court of Appeal but to intervene. [At 76-7; emphasis by underlining added.]

This standard was affirmed and supplemented more recently in Penner v. Niagara (Regional Police Services Board) 2013 SCC 19, where the Court stated:

A discretionary decision of a lower court will be reversible where that court misdirected itself or came to a decision that is so clearly wrong that it amounts to an injustice:

Elsom v. Elsom, [1989] 1 S.C.R. 1367, at p. 1375. Reversing a lower court’s discretionary decision is also appropriate where the lower court gives no or insufficient weight to relevant considerations: Friends of the Oldman River Society v. Canada …

[At para. 27.]

Public Policy Voids Homophobic Will

Public Policy Voids Homophobic Will

An Ontario judge in Royal trust Corp. of Canada v The University of Western Ontario et al 2016 ONSC 1143 has struck down a deceased doctor Priebe’s  attempt to set up university scholarships exclusively for white, single and heterosexual students, ruling the unusual stipulations clash with “public policy.”

Dr. Priebe’s will directed his trustee to set up bursaries for students in science but also directed that one should be to: Caucasian, male, single, heterosexual students”.

Another bursary was to a  ” hard -working, single, Caucasian ( white) girl who is not a feminist or lesbian”

Some male bursaries were peculiar such as the recipient should ideally demonstrate that” that are not afraid of manual work in the selection of their summer employment”.

The court deleted these bursary awards on the basis that they were discriminatory  of marital status, gender, race and sexual orientation , and thus were void on the ground of public policy and were deleted from the will.

The  Law

[9] The leading authority is Canada Trust Co. v. Ontario Human Rights Commission. 1990 CanLn 6849 at 22 (Ont. C.A.)

In that case, the indenture, under which the inter vivos trust was created, contained four recitals relating to race, religion, citizenship, anceshy, ethnic origin and colour with respect to the persons eligible to receive scholarships under the will. One recital stated: “The Settlor believes that the white race is, as a whole, best qualified by nature to be entrusted with the development of civilization and the general progress of the world along the best lines.”

[10] The Ontario Court of Appeal in Canada Trust Co. found the charitable trust to be void on the ground of public policy to the extent that it discriminated on the ground of race (colour, nationality, ethnic origin, religion and sex.

[11] As a guiding principle, the court in Canada Trust Co. stated that each trust must be evaluated on a case-by-case basis should its validity be challenged and cautioned that not all restrictions amount to discrimination and are therefore contrary to public policy. ethnic origin), religion and sex.

Enforcing Foreign Judgements

Enforcing Foreign Judgements

Ace Life Insurance Co. v Li 2015 BCSC 2533 held that a judgement against the defendant for $100,000 in Hong Kong as the personal representative of her late husband’s estate for court costs as the losing party in an action she brought on behalf of the estate, but stood to personally gain if she had won, could be enforced in British Columbia.

This area of law is known as Conflict of Laws and it can be very difficult to navigate- the facts of this case as such are limited to between Hong Kong and British Columbia and not every judgement from around the world will be enforced.

The Court held that the foreign judgments for court costs could be enforced in British Columbia for a few reasons including that to do so would not offend the basic morality of Canadians and the costs had been assessed on a legislated code after a fair trial.

The legal test for enforcing foreign judgements

[10] There was no dispute on the legal test to be applied when an application is made to enforce a foreign judgment. In Morguard Investments Ltd. v. The Savoye, [1990] 3 S.C.R. 1077, the Supreme Court of Canada considered whether an Alberta judgment could be enforced in the B.C. courts. It held that it could, and the Supreme Court of Canada adopted the “real and substantial connection” test. That test asks whether there is a real and substantial connection between the defendant in the domestic action and the subject matter of the litigation in the foreign judgment sought to be enforced. In 2003, the Supreme Court of Canada had occasion to consider whether the test should be applied to international judgments, and it held that it did in Beals v. Saldanha, [2003] 3 S.C.R. 416.

[11] Ms. Li does not deny that Ace Life Insurance has established the real and substantial connection test in this case. She says an exception applies and the judgment should not be enforced on that basis.

[12] In Beals, the court discusses the defences available to a domestic defendant at paras. 39 to 77, which include fraud, public policy and lack of natural justice. Ms. Li relies on public policy defence in this case.

[13] At paras. 71 to 77, Justice Major, on behalf of the majority of the court, sets out the scope of this defence. To be successful, the domestic defendant must establish that the foreign law is contrary to Canadians’ view of basic morality or where the outcome is so egregious it would shock the conscience or be unacceptable to reasonable Canadians. One example suggested would be enforcement of a judgment rendered by a court proven to be corrupt or biased.

[14] As noted by Justice Major, the public policy defence amounts to the impeachment of a foreign judgment by condemning the foreign law on which the judgment is based. He stressed it is not a defence to be granted lightly and ought to have narrow application.

[15] In that case, the plaintiff in the Canadian litigation was attempting to enforce an award it received from a jury in Florida. The Florida litigation involved a dispute about the sale of vacant land owned by residents in Ontario. The Ontario defendant chose not to actively defend the action and default judgment was entered. A jury awarded $210,000 in damages and $50,000 in punitive damages. The award was not appealed.

[16] The successful party in the Florida action then sought to enforce its award in Ontario. In the meantime, interest accrued such that by the time the case was heard in the Supreme Court of Canada, the award had grown to over $800,000. The majority of the Supreme Court of Canada concluded that although the amount involved was large, that did not on its own create a basis to refuse to enforce the judgment, and at para. 76 Justice Major stated:

Even if it could be argued in another case that the arbitrariness of the award can properly fit into a public policy argument, the record here does not provide any basis allowing the Canadian court to re-evaluate the amount of the award. The public policy defence is not meant to bar enforcement of a judgment rendered by a foreign court with a real and substantial connection to the cause of action for the sole reason that the claim in that foreign jurisdiction would not yield comparable damages in Canada.

[17] Ace Life Insurance submits it has easily met the test to enforce the Hong Kong judgment. It then asks this court to order the costs to be paid by Ms. Li in her personal capacity as opposed to as a representative of her husband’s estate.

Should the Hong Kong judgment be enforced?

[18] In relation to the first issue, Ms. Li argues that the award offends against the principles of proportionality and therefore would offend Canadians’ sense of basic morality. In my view this argument cannot succeed. It is akin to the argument that was raised and rejected in Beals that it was the amount of the award that would offend Canadians.

Spousal Separation Needs Intention

Spousal Separation Needs Intention

It is often difficult for third parties to know if a spousal couple has “legally” separated or not and a sudden death will invariably lead to litigation over the issue.

The Courts have established in Manitoba, and I believe it would be followed in BC, that in order for separation to be established “theevidence of separation must be “clear and convincing”, and the intention to separate must be “communicated to the other party and acted upon”.
Venditti v. Slobodiianik 2013 MBQB 202 has the following quote of law:
23 The cases of separate and apart under the same roof generally focus on the physical living arrangements of the parties but there is another important consideration as well, namely, whether one or both had formed the intention to live separate and apart thereby destroying the consortium of the married relationship: see apart thereby destroying the consortium of the married relationship: see Eamer v. Eamer (1971), 21 D.L.R. (3d) 18 (Man. Q.B.); Herman v. Herman (1969), 3 D.L.R. (3d) 551 (N.S.S.C.); Coates v. Coates, [2000] M.J. No. 272, 146 Man.R. (2d) 249 (Master Harrison – Man. Q.B.) – upheld on appeal 2000 MBQB 197.
24 As well, Molodowich v. Penttinen (1980), 17 R.F.L. (2d) 376 (Ont. Dist. Ct.), a unmarried cohabitation case developed a useful list of factors and components deserving of consideration when courts are called upon to consider when “unmarried cohabitation” begins and ends. In doing so, Kurisko D.C.J. reviewed many of the historical decisions on marriage, consortium, conjugal relations and cohabitation. The Molodowich list of factors has been commented on favourably by the Supreme Court of Canada in M. v. H., [1999] 2 S.C.R. 3, and has been used and applied in a number of cases in Manitoba and elsewhere. In Manitoba see Huberdeau v. Reid, 2007 MBQB 69; McGee v. Ranson, 2003 MBQB 182; Maresich v. Penner, 2007 MBQB 85; Bullied v. Kallen, 2008 MBQB 268.
25 Two further cases provide helpful reference points and hearken back to the injunction in Galbraith, supra, that the evidence in support of a claim of separation or cessation of cohabitation must be “clear and convincing”. In Gibbons v. Kowal, 2006 MBQB 11, Hanssen J. held that:
A conjugal relationship ends “… when either party regards it as being at an end and, by his or her conduct, [demonstrates] in a convincing manner that this particular state of mind is a settled one.” [para. 9]
26 Finally, in Field v. McLaren, 2009 MBQB 118, Douglas J. (as she then was) in the context of a common-law partner Family Property Act claim held at para. 10 that:
Certainly I accept it is settled law that the intention of one party to separate may be sufficient to sever the relationship. Judged objectively though there must be evidence that an intention to separate was not only held, but was communicated to the other party and acted upon. The person desiring to separate must act in a way consistent with an intention to separate.
. . .
48 A discordant and disrupted marriage over many years is not the equivalent of a separation or cessation of cohabitation.
37      In summary: cohabitation may be considered to continue notwithstanding a “discordant relationship”, the evidence of separation must be “clear and convincing”, and the intention to separate must be “communicated to the other party and acted upon”.

Will Witnesses No Longer Required

Will Witness No Longer Required

For my first 40 years of practice, and for time immemorial before , there were strict requirements for the execution of a will – a failure thereof could result in an invalid or partially invalid will.

That all changed under sections 58 and 59 of WESA, known as the “curative provisions” or the “ dispensation powers”.

Many recent decisions have allowed what would have been previously invalid wills to be admitted into probate as valid , despite the lack of any witnesses to the will, provided the court is satisfied it is the will makers signature and firm intention as to the disposal of his/her property after death. ( This is to be distinguished from other Province’s holographic wills which must be “ wholly written and signed by the will maker so typed and drug stores do not apply there but do in BC under WESA).

One of the interesting by products of the liberalization of the requirements for will execution is that many more people will do their own wills to save money and this will result in more estate litigation for various later discussed reasons.

The Law

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.

The chambers judge who had held that a letter written by the deceased’s accountant to the deceased’s solicitor containing proposed revisions to the deceased’s will should be admitted to probate was reversed. The accountant had prepared the letter after receiving instructions from the deceased to change his will to leave most of his estate to various charities rather than to his children. When the deceased later met with his solicitor and confirmed the alterations to the will contained in his accountant’s letter, the solicitor requested the deceased obtain a certificate from his doctor confirming that he had the capacity to execute the will. The deceased died two months later without having obtained the medical certificate. The solicitor had not spoken with the deceased in the interim, nor had he prepared a new will.

In George, the Court stated the following principles:

It is well established that imperfect compliance, even non-compliance, with the formal requirements of The Wills Act may be excused. However, it must be established that the document being propounded 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

(a) The standard of proof on an application under the curative provision is proof on a balance of probabilities (para. 20).

(b) The greater the departure from the requirements of formal validity, the harder it may be for the court to be satisfied that the document represents the deceased’s testamentary intention (para. 19).

(c) The requirements for formal validity of a will serve several purposes or functions, including:

  1. an evidentiary function by providing the court with reliable and permanent evidence of testamentary intention and the terms of the will; and
  2. a cautionary function by impressing upon the testator the solemnity, finality, and importance of his actions in making his “last will and testament” (at paras. 21-26).

(d) The evidentiary and cautionary functions are particularly relevant to the determination of whether or not a writing or document embodies the testamentary intentions of a deceased (para. 22).

(e) Not every expression made by a person, whether orally in writing, concerning the disposition of his or her property on death embodies his or her testamentary intentions (para. 62).

(f) The court held at para. 65:

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.

The leading case on the curative powers of section 58 and 59 WESA in B.C. are those of Madam Justice Dickson ( since elevated to the Appeal Court) in Re Young Estate 2015 BCSC 182 which largely follows George v. Daily:

… 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.

Other Cases

In Beck Estate (Re), 2015 BCSC 676, Master Young (as she then was) considered a handwritten document in letter form, which the deceased dated and signed. The court found that the words “Codicil to my Last Will” and instructions that the document was to be read out by her lawyer suggested a deliberate or fixed and final expression of intention regarding the disposal of the deceased’s property upon her death. The deceased had also given the document to her executor for safekeeping one week before her death, and had told him that she thought the unwitnessed Codicil was valid.

Re Lane 2015 BCSC 2162 held that none of  seven handwritten notes made between April 14, 2012 and January 9, 2015 represented the intention of the deceased to alter her Last Will and Testament dated July 12, 1994 and could not be cured under s 58 of WESA, the “curative provisions”.

The case is helpful in determining the boundaries of the curative provision of s 568 in that the judge sets out the various reasons why the scrap notes could e testamentary and then the reason why they may not be testamentary, and concludes the latter.

In an uncontested application Re the Estate of David Woolrich, deceased Vancouver Registry V140043 ( unreported dated January 21,2015, ), a short 4 page hand printed suicide note of the deceased was approved as his last will and testament under the curative powers of S 58 WESA and George v. Daily was followed.

Affidavit materials filed made it clear that it was the deceased who wrote the note and that it was his final testamentary intention.

Homemade wills lead to litigation

The public is reluctant to pay a lawyer’s hourly rate to prepare what they invariably regard is a “simple” will. (Every 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 cost  save 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 were well-intentioned and generally are reasonable once the court is satisfied that the documents reflect the 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  that will ultimately lead to more contested “homemade” wills  litigation, particularly in issues related to mental capacity, undue influence and wills interpretation .

Wills Interpretation Guidelines

Wills Interpretation GuidelinesEberwein Estate v. Saleem, 2012 BCSC 250 (B.C. S.C.), the executor sought advice and direction from the court regarding bequests in a Will which were unclear, and the court set out the general guidelines for wills interpretation.

 

[30] Courts are greatly suspicious of attempts by testators to give with one hand and retain with the other. If an absolute gift is made, accompanied by uncertain language expressing a wish or request, the courts are reluctant to imply a trust: McIver Estate v. McIver, [1981] B.C.J. No. 68 (S.C.) at para 4; Sutherland Estate v. Nicoll Estate, [1944] S.C.R. 253 at 262, [1944] 3 D.L.R. 551 [sub. nom. Hayman v. Nicoll]. In the McIver case, the word “trust” was used and so the court did not consider the words to be “merely precatory or recommendatory”. However, in the present case, the word “trust” was not used in the clause at issue. Rather, I find that the words used here imposed no defined restrictions on the beneficiaries and are so loose that a trust could not have been intended by Ms. Eberwein, who was sufficiently sophisticated to have spelled out a trust clearly if that is what she intended.

 

16      The goal in interpreting a will is to give effect to the testamentary intentions of the testatrix for the distribution of her estate: Robinson Estate v. Robinson, 2011 ONCA 493, 337 D.L.R. (4th) 193 (Ont. C.A.), at para. 23.

 

17      The Ontario Superior Court of Justice in Kaptyn Estate, Re, 2010 ONSC 4293, 102 O.R. (3d) 1 (Ont. S.C.J.), (“Kaptyn Estate”) helpfully summarized many of the principles relating to the interpretation and construction of wills:

 

  1. The court will seek to determine the actual intention of the testator, as opposed to an objective intent presumed by law (para. 31).
  2. Other cases interpreting words in other wills are of little assistance since the task is to interpret this testator’s subjective intentions (para. 32).
  1. c) There is a distinction between interpretation and construction of a will. Interpretation seeks to determine the testator’s subjective intentions from the words used in light of the surrounding circumstances. Rules of construction are a default process turned to by the courts when the testator’s actual intentions cannot be ascertained (para 34).

 

  1. The starting position of the court is the “armchair rule”, where the court puts itself in the place of the testator at the time when he made his will. This allows consideration of some extrinsic evidence of the surrounding circumstances known to the testator as might bear on his intentions (para. 35).
  1. e) The authorities distinguish between admissible and inadmissible extrinsic evidence in interpreting a will (paras. 35-38):

 

  1. “indirect extrinsic evidence” of the surrounding circumstances known to the testator at the time he made the will is generally admissible. This includes evidence of such things such as the testator’s occupation and property and financial situation; his relationships with family and friends; and natural objects of his grant;
  3. “direct extrinsic evidence” of the testator’s intentions is generally inadmissible. This is so as to preserve the will itself as the primary evidence, and to avoid the situation of an “oral will” displacing the written form. However, there is an exception where there is an “equivocation”, namely, where the will describes two or more persons or things equally well. In that situation, the law will allow evidence of the testator’s intention. Examples of inadmissible direct evidence are such things as notes or statements of the testator as to his intention, or instructions he gave his lawyer in preparing the will;

 

  1. f) the court will interpret the will viewed as a whole (para. 138);
  2. g) the court will prefer an interpretation that leads to a testacy, not an intestacy (para. 139); and,
  3. h) the court will not hesitate to correct obvious mistakes, including deleting or inserting words, where to do so accords with the testator’s intentions, or where not to do so would lead to an absurd result (para 140).

 

18      The proper approach of the court is to consider the language of the will in light of the surrounding circumstances together, rather than one first and then the other: Abram Estate v. Shankoff, 2007 BCSC 1368 (B.C. S.C.) at para. 77.

 

Incorporation By Reference

Incorporation By ReferenceIncorporation by reference typically occurs when a trust company is appointed executor and the deceased’s will makes reference to a certain fee agreement entered into between the then client and the trust company to retain their services as executor/trustee and to pay a  fee schedule.

 

Another common example is the  reference to a memorandum of items to be distributed as part of the will, without actually being contained within the will itself.

Re Marshall Estate 39 ETR ( 2d) 87 is such a case re  an undated memorandum of personal items found in the deceased’s personal effects several weeks after death.

The court found that the memorandum had obviously been prepared shortly before the will and was instructions for the will and not meant to be testamentary in character.

No inconsistency existed between the memorandum and the will and the memorandum was simply the memorandum referred to in the will, and those portions of it pertaining personalty were admitted into probate by incorporation of reference .

Theobald On Wills 13th ed.para 275 : “Even though the documents may be invalid as an independent instrument, it will take effect if incorporated by reference in the will, as part of the testamentary disposition”

Re Jackson (1985 ) 2 WWR 91 allowed parol evidence to be admitted for the purpose of determining whether the memorandum was the one referred to in the will.

1

                         Tristram aind Cootes, Probate Practice, 23rd ed. (1970), at pp. 699-700, summarizes the reported cases in respect to the requirements to permit the incorporation by reference into a will of a testamentary paper. The requirements are these. The document to be incorporated:

2        (A)    must be in existence at time of execution;

3        (B)    and must be described as then existing;

4        (C)    and in such terms that it is capable of being ascertained; and

(D)  the will must not state that the document is not to     form part of it

Missing Heirs

missing heirs 2People, including heirs, go missing for all sorts of reasons all the time. This of course presents a problem to an executor who must serve all heirs under the will, and anyone who would inherit on an intestacy, along with a copy of any application for probate with a copy of the will attached.

I am frequently contacted by enquiries on my website asking if there is any way in which one can in effect , be notified or a website that can be visited  as to  search someone’s death .

Regrettably, there is not. The problem is compounded by spouses taking another  spouses surname .

One advantage with inheritances is that people often will eventually hear word of the passing of a loved one and may seek out a possible inheritance .

The executor must use all reasonable means possible to try and determine the location and serve the perspective heir with notice of the probate application .

This will typically involve professional search locators who can essentially find anyone  as long as they “participate in society “by doing such things as filing tax returns, etc.

Many people do not.

The problem  out of the missing heir for the executor then becomes how does he or she finalize the estate so as to be discharged of his or her duties?

 

The answer lies in sections 39 and 40 of the Trustee act or the personal representative can obtain a discharge for the missing beneficiary  by obtaining an order that, the personal representative be at liberty to distribute the estate, including of the payment of the missing person share, but into court.

If the evidence of the missing their approaches something similar to a presumption of death order , in other words, very strong inference can be drawn  that the heir is “not about “so to speak get  a “Benjamin order”. If such order is granted, the trustee may then be discharged by distributing the estate, including the missing heirs portion, to the remaining beneficiaries.

Solicitor Client Privilege and the Will File

Solicitor Client Privilege Upheld By Highest Court

Solicitor client privilege and the will file can often end up in a tug of war between the executor upholding a claim of privilege after the death of the estate deceased, and beneficiaries who want to see the lawyers notes and other file contents of the same deceased.

The decision of Chang v. Lai Estate 2014 BCSC 128 discusses these competing principles in the context of the advice re a   wills variation action was also in the same file as advice and documentation relating to the administration of the estate.

The court held that solicitor client privilege should apply where the beneficiaries are in an adversarial relationship with the executor. Solicitor client privilege will remain in place to preserve the confidentiality of those communications. There must be a joint for common interest before the court will entertain disclosing such communications, as otherwise they will remain privileged.

[16] It is well established that a beneficiary has a proprietary interest in and a right to production of any document relating to advice sought and obtained by an executrix or trustee in connection with the administration of an estate. The executrix cannot claim solicitor-client privilege over such documents because they have a commonality of interest with the beneficiaries in the administration of the estate. The advice taken by the executrix is for the benefit of all beneficiaries under the will. There is no need to protect solicitor-client communications from disclosure because the beneficiaries and the executrix have a joint interest in the advice: Re Ballard Estate at p. 354. The same principle applies to legal opinions the executrix obtains regarding the proper administration of the estate. No solicitor-client privilege applies because the legal opinion sought by the executrix was to further the interests of the beneficiaries under the will: Re Ballard Estate at p. 354.

[17]         The beneficiary is not, however, entitled to production of all communications between legal counsel and the executrix. Where there is an adversarial relationship between a trustee and a beneficiary, there is no “joint interest” that compels disclosure of communications that would normally be protected by solicitor-client privilege. As Lederman J. says in Re Ballard Estate at p. 354:

… there is no need to protect the solicitor-client communication from disclosure to those very persons who are claiming under the estate. The communications remain privileged as against third parties who are strangers or are in conflict with the estate, but as was stated in Stewart v. Walker, supra, not those who are claiming under the estate. And that is because the trustee and beneficiary have a joint interest…

[18]         The requirement for a joint or commonality of interest was recognized in MacPherson, where Humphries J. says at para. 18:

Both sides cited cases which stand for the same basic proposition:  A beneficiary has a proprietary interest in and is entitled to production of documents relating to advice sought and obtained by a trustee in connection with the administration or management of, for instance, a pension plan, or an estate (see Froese v. Montreal Trust Co. of Canada [1993] B.C.J. No. 1529 (S.C.), aff’d [1993] B.C.J. No. 1847 (C.A.); Re Ballard Estate [1994] O.J. No. 2281 (Gen. Div.); Cooke et al v. Canada Trust  (Van. Reg. No. S011763, October 22, 2004; leave to appeal granted); Merritt v. Imasco Enterprise Inc. [1992] B.C.J. No. 2011; Thomas v. Secretary of State for India in Council (1870) 18 W.R. 312 (Ch.)), but not to documents that arise in the course of an adversarial relationship between the trustee and beneficiary.

[19]         There are clearly conflicting principles in this case. On the one hand, it is of the utmost importance to protect solicitor-client communications from disclosure. The law has consistently upheld the confidential nature of such communications and strictly construed the circumstances that may be regarded as an implicit waiver of the privilege. On the other hand, the beneficiaries of a trust are entitled to production of documents that fall broadly within the category of administration of the estate.

[20]         Balancing these conflicting principles, I find that the issue in this case must be resolved in favour of the plaintiffs. The underlying basis for exempting from solicitor-client privilege those documents that relate to advice sought in connection with the administration of the estate is the joint or common interest of the trustee and the beneficiary. It follows that where the beneficiary is in an adversarial relationship with the executrix, solicitor-client privilege remains in place to preserve the confidentiality of those communications. In this case the defendants do not have a common or joint interest with the plaintiffs regarding the wills variation action. Their interests are clearly in conflict due to the variation of the will sought by the plaintiffs. Thus legal advice sought and received for that purpose remains privileged.

[21]         Furthermore, the fact that the plaintiffs retained the same legal counsel to act for them in regard to the wills variation action and the administration of the estate does not amount to a waiver of solicitor-client privilege. Regardless of whether Mr. Takahashi was in a conflict of interest position (and in light of the practice in estate law this is questionable), the plaintiffs cannot be taken to have waived solicitor-client privilege because he acted in both capacities. The fact that Mr. Takahashi kept the same file for both the wills variation litigation and the administration of the estate is unfortunate; however, it does not evidence a waiver of solicitor-client privilege by his clients qua plaintiffs in the wills variation action.

[22]         For these reasons, I dismiss the defendants’ application for production of the remaining documents from Mr. Takahashi’s file”

 

Pet Trusts

Pet TrustsPet Trusts

Today’s news mentioned that a deceased left $100,000 to care for her 12 parrots.

At first blush this may seem unreasonable, but given that her wealth was in excess of 5 1/2 million dollars, and the long life expectancy of parrots, this may not have been an unreasonable amount to leave in  trust for one’s  surviving pets.

In fact it is advisable that if one intends to care for a surviving pet, that an appropriate sum of funds be  set aside in one’s will to provide for this occurrence. Such trust fund amount could be reasonably calculated given the life expectancy of the animal, the cost of food care and veterinary services.

On the other hand, approximately 20 years ago, I was consulted with respect to a deceased single physician with no children who suddenly died young, and left her 1 million Dollar estate to her two cats and four dogs for their lifetime care.

In legal terminology, this is called an “imperfect trust”.

The million dollars was obviously an inordinate and inappropriate sum of money to provide for the animals, and the residual beneficiaries of the million dollar estate sought my advice.

The long and short of it, was that the dogs life expectancy being Great Danes was only seven years, but the cats life expectancy was in the range of 20 years.

We resolved the matter by providing for an appropriate amount of funds for care for the animals, and distributed the residue of the estate to the residual beneficiaries. The pets were in no legal position to object or consent.