BC Estate Lawyer – Was There a Settlement?

Trevor Todd and Jackson Todd have over sixty combined years of estate litigation which often includes issues such as was there a settlement?

In Hutton v. Hutton, 2020 BCSC 2046, the Honourable Chief Justice Hinkson reviewed various authorities which dealt with summary applications, brought in an action to enforce agreements to compromise that same action. At para. 30, he concluded that he could properly enforce a settlement agreement and grant a stay of proceeding through such motion if he were to find that there was a binding settlement agreement.

Essential Terms
[20] The question then remains—was there a settlement agreement between these parties?

[21] Again, reference to the Hutton case provides recent and persuasive authority on such assessment. At paras. 31–33, Hinkson C.J.S.C. says:

Is there an Enforceable Agreement between the Parties?

[31] The burden of proving the existence of a settlement agreement is on the party seeking to enforce or rely on it: Salminen v. Garvie, 2011 BCSC 339 [Salminen] at para. 26. The standard of proof required is on the balance of probabilities.

[32] To determine if a settlement agreement is enforceable, the court must consider whether the parties reached agreement on all essential terms. In Fieguth v. Acklands Ltd. (1989), 59 D.L.R. (4th) 114 (B.C.C.A), [Fieguth] Chief Justice McEachern stated at 121:

… The first question is whether the parties have reached an agreement on all essential terms. There is not usually any difficulty in connection with the settlement of a claim or action for cash. That is what happened here and as a settlement implies a promise to furnish a release and, if there is an action, a consent dismissal unless there is a contractual agreement to the contrary, there was agreement on all essential terms.

[33] In Apotex Inc. v. Allergan, Inc., 2016 FCA 155, at paras. 32–33, Mr. Justice Stratas phrased the test to determine if an enforceable settlement had been reached as follows:

[32] The court is to view the specific facts of the case objectively in light of the practical circumstances of the case and ask whether the parties intended to be legally bound by what was already agreed or, in other words, whether an “honest, sensible business [person] when objectively considering the parties’ conduct would reasonably conclude that the parties intended to be bound or not” by the agreed-to terms: G Percy Trentham Ltd v Archital Luxfer Ltd. (1992), [1993] 1 Lloyd’s Rep 25, 63 B.L.R. 44 (C.A.) at paras. 50 and 86; Ward at para. 61; Hughes v. City of Moncton, 2006 NBCA 83, 304 N.B.R. (2d) 92 at para 6. Put another way, looking not through the eyes of lawyers, but through the eyes of reasonable businesspeople stepping into the parties’ shoes, was there something essential left to be worked out? See Investors Compensation v. West Bromwich Building Society, [1998] I All E.R. 98; [1998] 1 W.L.R. 896 (H.L,); Chartbrook v. Persimmon Homes, [2009] UKHL 38, [2009] A.C. 1101; Re Sigma Finance, [2009] UKSC 2, [2010] 1 All E.R. 571. Another way of putting it is to ask how “a reasonable [person], versed in the business, would have understood the exchanges between the parties”: Bear Steams Bank pic v. Forum Global Equity Ltd., [2007] EWHC 1576 (Q.B.D. Comm.) at para 171.

[33] When courts find that there has been an agreement on essential terms, they will often imply non-essential terms into the agreement: McCabe, above at para 20; Fieguth, above; Hughes, above at para. 6. The lack of agreement on non-essential terms will not stand in the way of a finding of an agreement. Put another way, “it is not necessary that the original contract include all the ancillary terms that are already implicit in its content”: Ward, above at para. 54. “Even if certain terms of economic or other significance to the parties have not been finalized, an objective appraisal of their words and conduct may lead to the conclusion that they did not intend agreement of such terms to be a pre-condition to a concluded and legally binding agreement”: RTS Flexible Systems, above at para. 45. For example, assuming an agreement on essential terms is otherwise in place, courts can imply terms concerning the granting of a release, the manner of payment and the timing of payment: Fieguth, above at para 21; Hodaie v. RBC Dominion Securities, 2012 ONCA 796 at para. 3; Imperial Oil Ltd. v. 416169 Alberta Inc., 2002 ABQB 386, 310 A.R. 338. Often these will be “mere formalities or routine language” Bawitko, above at p. 106.

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.

 

 

 

 

 

 

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;

 

 

Vancouver Estate Lawyer-Presumption of Undue Influence Applied

Trevor Todd and Jackson Todd have over 60 years combined legal experience in handling estate disputes, including undee influence.

Re Campbell estate 2022 BCSC 2184 set aside a transfer in favour of one child over others on the basis of both undue influence and resulting trust.

The defendants knew that the deceased was frail and vulnerable and were clearly in a position of dominance over her.

UNDUE INFLUENCE

The law relating to the presumption of undue influence was described by Madam Justice Wilson in Geffen v. Goodman Estate, [1991] 2 S.C.R. 353 [Geffen]. At para. 23 she wrote that:

The equitable doctrine of undue influence was developed, as was pointed out by Lindley L.J. in Allcard v. Skinner (1887), 36 Ch. D. 145, not to save people from the consequences of their own folly but to save them from being victimized by other people (at pp. 182-83). In the context of gifts and other transactions, equity will intervene and set aside such arrangements if procured by undue influence.

[215] Undue influence will be presumed in certain relationships, such as doctor and patient, solicitor and client, and parent and child: Geffen at para. 28. The categories of relationships in which undue influence will be presumed are not fixed. Each case must be considered on its own facts to determine if a “special” relationship exists to support the presumption.

[216] At paras. 42–45, Wilson J. set out what must be established to trigger the presumption of undue influence in these terms:

[42] What then must a plaintiff establish in order to trigger a presumption of undue influence? In my view, the inquiry should begin with an examination of the relationship between the parties. The first question to be addressed in all cases is whether the potential for domination inheres in the nature of the relationship itself. This test embraces those relationships which equity has already recognized as giving rise to the presumption, such as solicitor and client, parent and child, and guardian and ward, as well as other relationships of dependency which defy easy categorization.

[43] Having established the requisite type of relationship to support the presumption, the next phase of the inquiry involves an examination of the nature of the transaction. When dealing with commercial transactions, I believe that the plaintiff should be obliged to show, in addition to the required relationship between the parties, that the contract worked unfairness either in the sense that he or she was unduly disadvantaged by it or that the defendant was unduly benefited by it. From the court’s point of view this added requirement is justified when dealing with commercial transactions because, as already mentioned, a court of equity, even while tempering the harshness of the common law, must accord some degree of deference to the principle of freedom of contract and the inviolability of bargains. Moreover, it can be assumed in the vast majority of commercial transactions that parties act in pursuance of their own self-interest. The mere fact, therefore, that the plaintiff seems to be giving more than he is getting is insufficient to trigger the presumption.

[44] By way of contrast, in situations where consideration is not an issue, e.g., gifts and bequests, it seems to me quite inappropriate to put a plaintiff to the proof of undue disadvantage or benefit in the result. In these situations the concern of the court is that such acts of beneficence not be tainted. It is enough, therefore, to establish the presence of a dominant relationship.

[45] Once the plaintiff has established that the circumstances are such as to trigger the application of the presumption, i.e., that apart from the details of the particular impugned transaction the nature of the relationship between the plaintiff and defendant was such that the potential for influence existed, the onus moves to the defendant to rebut it. As Lord Evershed M.R. stated in Zamet v. Hyman, supra, at p. 938, the plaintiff must be shown to have entered into the transaction as a result of his own “full, free and informed thought”. Substantively, this may entail a showing that no actual influence was deployed in the particular transaction, that the plaintiff had independent advice, and so on. Additionally, I agree with those authors who suggest that the magnitude of the disadvantage or benefit is cogent evidence going to the issue of whether influence was exercised.

[Emphasis added.]

[217] McMaster Estate v. McMaster, 2021 BCSC 1100 provides a recent illustration of the application of these principles in this court. In that case, a mother had purchased a home and registered it in joint title with one of her sons. While the deceased’s will provided for her estate to be split evenly between her children, the transfer had already taken nearly all of the deceased’s assets out of her estate. The estate alleged that the son who owned the house with the mother held it pursuant to a resulting trust or as a result of undue influence. In this context, Justice MacDonald summarized the applicable legal principles as follows:

[47] Undue influence is an equitable doctrine to prevent individuals from being taken advantage of by others. It addresses abuses of trust, confidence, and power spanning a range of transactions, including gifts, bequests, and commercial dealings. Transactions induced by undue influence may be set aside.

[48] Vulnerability and dependency are the hallmarks of undue influence.

[49] In order to trigger a presumption of undue influence, the first question to address is whether the potential for domination inheres in the nature of the relationship. The second phase of the inquiry involves an examination of the nature of the transaction: Geffen v. Goodman Estate, [1991] 2 S.C.R. 353 at paras. 40-44.

[50] A relationship of dependency involving a potential for domination may arise among family members: Geffen. A gratuitous transfer from a parent to an adult child does not automatically create a presumption of undue influence. In Wood v. Porter, 2015 BCSC 2354, this Court found a relationship of dependency and domination did not exist between an independent, active, and competent mother and her son. To establish the presumption of undue influence, the plaintiff must establish the existence of a relationship of potential dominance between the parent and the adult child: Modonese at para. 111.

[51] The second phase of the inquiry involves an examination of the nature of the transaction.

[52] To rebut the presumption of undue influence, the defendant must establish that the transferor entered into the transaction of her own “full, free and informed thought”: Geffen at para. 45.

[53] The following factors may be considered when scrutinizing the transaction to determine if Doreen entered into the transaction of her own “full, free and informed thought”: (i) the lack of actual influence or opportunity to influence her; (ii) whether she received or had opportunity to obtain independent legal advice; (iii) her ability to resist any such influence; (iv) whether she knew and appreciated what she was doing; (v) whether there was undue delay in confirmation by Doreen; and (vi) the magnitude of the benefit or disadvantage: Cowper-Smith v. Morgan, 2016 BCCA 200 at para. 50, rev’d on other grounds, 2017 SCC 61; Stewart v. McLean, 2010 BCSC 64 at para. 97.

[Emphasis added.]

[218] Applying those principles to the present case, I find that the potential for dominance clearly existed in Ivan’s relationship with Mrs. Campbell. Mrs. Campbell was experiencing cognitive decline, she was vulnerable, and she was increasingly dependent on others for activities of daily living, including Ivan. She was engaging in uncharacteristically risky financial behaviour. Ivan had informed himself of the details of Mrs. Campbell’s finances, and attended the meetings with her at the CIBC and RBC. Ivan was in a dominant position in his relationship with Mrs. Campbell.

Vancouver Wills Variation Lawyer- The Leading Case- Tataryn

Trevor Todd of disinherited.com has 50 years experience in the Vancouver general area handling wills variation cases to obtain  just results for a disinherited child or spouse.

 

The law of wills variation currently flows from section 60 of the Wills, Estates and Succession Act (“WESA”)
 which empowers the court, in its discretion, to vary a will if, in the court’s
opinion, the will does not make adequate provision for the proper maintenance and support of
the will-maker’s spouse or children:

Despite any law or enactment to the contrary, if a will-maker dies leaving a will that
does not, in the court’s opinion, make adequate provision for the proper maintenance
and support of the will-maker’s spouse or children, the court may, in a proceeding by or
on behalf of the spouse or children, order that the provision that it thinks adequate, just

and equitable in the circumstances be made out of the will-maker’s estate for the
spouse or children.

The governing authority in British Columbia on the application of section 60 of the Act is the
Supreme Court of Canada decision in Tataryn v. Tataryn Estate, [1994] 2 SCR 807.

 

In that case, Justice McLachlin ) set out the key principles that must guide the court in the
exercise of its discretion, including the following:

  1. The test for determining what is “adequate, just and equitable” is that of the “judicious
    father of a family seeking to discharge both his marital and his parental duty”.
  2. The determination of what is “adequate, just and equitable” should be made according
    to contemporary standards. Those standards will change from time to time and the
    courts are not bound by the views and awards made in earlier times when standards
    were different.
  3. While the WESA protects both the interests of “adequate, just and equitable” provision
    for claimants and testamentary autonomy, the former interest is paramount.
    Testamentary freedom must yield to the extent required to achieve adequate, just, and
    equitable provision for the applicant spouse and/or children and only to that extent.
  4. A proper determination of what is “adequate, just and equitable” has two distinct
    components: assessment of the will-maker’s “legal obligations” and “moral obligations”
    to the claimant.
  5. All claims against the estate should be met if the size of the estate so permits. If all
    claims cannot be met, legal obligations should take precedence over moral obligations.
  6. The moral claim of independent adult children is more tenuous than the moral claim of
    spouses or dependent adult children. But if the size of the estate permits, and in the
    absence of circumstances negating the existence of such an obligation, some provision
    for adult independent children should be made.
  7. In any given case, there will be a wide range of options, any of which might be
    considered appropriate in the circumstances. Provided that the testator has chosen an
    option within this range, the will should not be disturbed.

{00966402.2}

Fixing a Will in BC-Digital Will Cured Under S. 58 WESA

Trevor Todd and Jackson Todd have over sixty years combined experience in estate litigation including ” fixing or curing” wills that fall short of proper execution procedures in icluding the advent of digital wills..

 

Rempel Estate v Dudley 2020 BCSC 2207 found that certain documents in digital form represented the true testamentary intentions of the deceased and cured the execution deficiencies under S. 58 WESA.

Canada Trust as administrator of the estate of the deceased petitioned the Court for an order under s. 58 of the Wills, Estate and Succession Act, S.B.C. 2009, c. 13 [WESA] that certain documents in digital form represent the testamentary intentions of the deceased, Mr. Rempel. As well, the petitioner sought an order that “deficiencies in any of the said documents which are found to be testamentary be cured”.
The documents in issue are contained on two memory sticks, the first of which contains recordings, including a voice memorandum created by Mr. Rempel and recordings of several telephone conversations between Mr. Rempel and a notary public.
The second memory stick contains file folders and sub-folders created by Mr. Rempel that hold electronic drafts of documents which potentially express Mr. Rempel’s testamentary intentions in the event he died without a will. More specifically, the latter documents include will instruction client questionnaire forms, i.e., drafts of information then sought by a notary public, presumably with the eventual intent to prepare a will, but the search of his premises did locate several paper and electronic documents which indicated Mr. Rempel had been actively working towards completion of a formal will.

The Law

Evidence of statements made by the deceased are admissible. I quote from Pasko v. Pasko, 2002 BCSC 435 at para. 10:

10 There is another exception to the hearsay rule which permits evidence to be given of statements made by deceased persons as to their present state of mind (including intention), which statements need not be against interest, provided that the deceased person’s state of mind is relevant to an issue in the case. See R. v. Smith (1992) 75 C.C.C. 3d 257.

In Modonese v. Delac Estate, 2011 BCSC 82 at para. 84 following reference to Pasko, the Court stated:

84 Following Pasko, if I am wrong in concluding that the statements concerning Regina’s intention to divide her assets equally are not admissible pursuant to s. 5 of the WVA, they ought to be admitted pursuant to this exception to the hearsay rule.

[The WVA was a reference to the Wills Variation Act, RSBC 1996, c.490, as repealed by WESA]

The hearsay statements attributed to the deceased are reliable in that they are repeated in many of the documents prepared by Mr. Rempel over a considerable period of time and, as such, are reliable as to his intentions regarding the disposition of his estate.

The introduction of s. 58 represented a departure from the formalities for execution which had been required under the Wills Variation Act, RSBC 1996, c.490, as repealed by WESA, which was discussed by Dardi J. in British Columbia (Public Guardian and Trustee) v. Shaeffer, 2015 BCSC 1306 at para. 26:

26 The formalities for execution have been incorporated into s. 37 of the WESA. However, the WESA has introduced a remedial provision in s. 58 that gives the court a broad authority to “cure” a purported will, an alteration to a will, or the revocation of a will that does not satisfy the signing and witnessing requirements prescribed by s. 37. S. 58 constitutes a key component of the modernization of the law of wills and succession in British Columbia because it empowers the court to uphold the will-maker’s true intentions even where the will, a gift under the will or a purported alteration or revocation of the will is invalid pursuant to other provisions of the WESA.

In order to be a testamentary document capable of being “cured” under s. 58, the document “must record a deliberate or fixed and final expression of the deceased’s intention regarding disposal of his property on death”: Re Smith Estate 2016 BCSC 350 at para. 23.

Fraudulent Conveyances/Transfers

The issue of whether a transfer of assets gratuitously made is a Fraudulent Conveyance or not vis a vis creditors is found in the caselaw arising from the Fraudulent Conveyance Act (FCA).

Section 2 of the FCA provides:

This Act does not apply to a disposition of property for good consideration and in good faith lawfully transferred to a person who, at the time of the transfer, has no notice or knowledge of collusion or fraud.

Two key questions arise when determining the validity of the Transfer: (1) whether there was good consideration for the Transfer, and (2) whether the defendants had the requisite intent.

A conveyance of property by a debtor to a creditor to satisfy an antecedent debt is made for good consideration and not void for fraud. As explained long ago by the Supreme Court of Canada in Mulcahy v. Archibold (1898), 28 S.C.R. 523, at 529(para.3):

… So long as there is an existing debt and the transfer to him is made for the purpose of securing that debt and he does not either directly or indirectly make himself an instrument for the purpose of subsequently benefitting the transferor, he is protected and the transaction cannot be held void.

[ The Court of Appeal relied on this proposition more recently in First Royal Enterprises Ltd. v. Armadillo’s Restaurant Ltd. (1995), 15 B.C.L.R. (3d) 254, 1995 CanLII 605 (C.A.) at para. 31, confirming that a pre¬existing debt can furnish good consideration within the meaning of the FCA, and so long as the debt is honestly due and owing, there is good consideration.

Where valuable consideration has passed, the party seeking to impeach the Transfer must show that the transferee actively participated in the fraud: Meeker Cedar Products Ltd. v. Edge (1968), 68 D.L.R. (2d) 294, 1968 CanLll 666 (B.C.C.A.) at 299, aff’d (1968), 1 D.L.R. (3d) 240, 1968 CanLII 776 (S.C.C.); First Royal Enterprises at para. 24; and Chan v. Stanwood, 2002 BCCA 474 at para. 20.

A bare assertion of a defence is insufficient to meet the applicant’s burden of establishing a “meritorious defence”. The applicant’s affidavit material should contain sufficient detail and supporting documents to buttress the asserted defence: Leibenzeder Estate v. MacIntyre, 2023 BCSC 1422 at para. 183.

The applicant must provide, by admissible evidence, sufficient detail to allow the chambers judge to determine whether a meritorious defence exists: Forgotten Treasures International Inc. v. Lloyd’s Underwiters, 2020 BCCA 341 at paras. 26–30.

The only intent necessary to meet the requirements of section 1 of the FCA is to “put one’s assets out of reach of one’s creditors”: Royal Bank of Canada v. Clarke, 2009 BCSC 481 at para. 20. No further dishonest or morally blameworthy intent is required: Abakhan & Associates Inc. v. Braydon Investments Ltd., 2009 BCCA 521 at para. 73.

Previous Wills Ordered Produced

In DeContiis v DeContiis Estate 2023 BCSC 2163 , a wealthy father of seven boys did six wills between 1997 and 2009 which the plaintiff sought to be produced in order to determine the deceased true intentions re his estate planning.

The deceased left a last will, January 2016, which disinherited one son entirely.

In 2019. The deceased established an alter ego trust in which he put substantial assets.

The plaintiff sought and was granted production of the previous six wills of the deceased in order to determine the deceased true intentions re his estate planning

The plaintiff argues that s. 62 of Wills and Estate Succession Act, S.B.C. 2009, c. 13 supports production of the prior wills. Section 62 states:
Evidence

62 (1) In a proceeding under section 60, the court may accept the evidence it considers proper respecting the will-maker’s reasons, so far as may be determined,
(a)for making the gifts made in the will, or

(b)for not making adequate provision for the will-maker’s spouse or children,

including any written statement signed by the will-maker.

(2) In estimating the weight to be given to a statement referred to in subsection (1), the court must have regard to all the circumstances from which an inference may reasonably be drawn about the accuracy or otherwise of the statement.

[The amended notice of civil claim at para. 53 of Part 3, Legal Basis, asserts that “prior wills, executed before 2016 and without the undue influence of the Younger Brothers, included the Plaintiff as a beneficiary”.

Based on these paragraphs of the amended notice of civil claim alone, the defendants ought to have listed the prior wills in their initial list of documents because they are material.

The prior wills are squarely at issue because the court considers prior wills where a will or other estate planning documents are challenged.

The prior wills are relevant to the claim of undue influence because they will disclose how the deceased treated the plaintiff in the prior wills which would be an indication of Innocenzo’s attitudes toward Ivano over time.

In Jung v. Poole Estate, 2021 BCSC 623, the trial judge analyzed the deceased’s attitudes towards his disinherited children by, in part, examining the terms of the prior wills (paras.

51 to 52) and Geluch v. Geluch Estate, 2019 BCSC 2203, in which the trial judge considered prior wills as evidence of the deceased’s prior wishes that were inconsistent with the impugned final will (para. 117).

Rule 7-1(11) requires listing and production of documents that “relate to any or all matters in question in the action”. The test for such disclosure is whether the documents “may enable a party, directly or indirectly, to advance their own case or damage that of their adversary, including documents that may fairly lead to a train of inquiry having either consequence”: Richter v. Richter Estate, 2023 BCSC 105 at paras. 57 and 58.

In Westman v. Westman, 2000 BCSC 236, the trial judge referred to the history of the deceased’s prior wills as indicative of an “inter-family phenomenon” (at para. 34) that was relevant to an assessment of whether the will made adequate provision for the deceased’s spouse. In the present case, the analogy to “inter-family phenomenon” is the changing attitudes Innocenzo had to each of his sons. The prior wills are relevant to this issue.

in Kobzos v. Kobsoz Estate, 2019 BCSC 2254, the documents relating to the deceased’s estate planning were relevant for production.

Enforcing Oral Contracts

Stojka v Stojka 2023 BCCA 446 held that a binding  oral contract existed between two brothers with respect to a beneficial interest in a property.

The court reviewed the law re oral contracts and in particular amongst family members where the communications in the family context are often no more than statements of intent or wishes.

The question of whether a given requirement for the formation of a contract has been met “involves applying a legal standard to a set of facts and is therefore a question of mixed fact and law”: Housen v. Nikolaisen, 2002 SCC 33 at para. 26.

If a party to an oral agreement acts as though there were a binding contract or the other party relies on the agreement to their detriment the party is unable to rely of the lack of a written agreement as a defence: Le Soleil Hotel & Suites Ltd. v. Le Soleil Management Inc., 2009 BCSC 1303 at paras. 342–345 [Le Soleil];

• An enforceable agreement is reached where parties have reached a meeting of the minds and the parties express themselves outwardly in a manner that indicates an intention to be bound: Le Soleil at paras. 322–323;

• Reasonable certainty of the terms of the agreement are required: Le Soleil at paras. 339–340;

• The existence of an oral agreement is determined by applying the objective reasonable bystander test to consider how the promisor’s conduct would appear to a reasonable person in the position of the promise: Le Soleil at paras. 324–325;

• The party alleging the oral agreement must be able to prove its existence on the balance of probabilities: Bell v. Bell, 1998 CanLII 3194 at para. 14, [1998] B.C.J. No. 1457 (S.C.).

Vancouver Lawyer – Wills Variance and Assets Outside of the Estate

Trevor Todd and Jackson Todd have over sixty years combined experience in handling contested estates including wills variation claims.

Only assets passing pursuant to a will and requiring probate can be attacked under the wills variance laws.

Other assets passing outside of the estate such as joint tenancies cannot be attacked under wills variation claims, but the court can take those assets into account.

Assets passing outside of the estate such as inter vivos dispositions and assets passing by right of survivorship are relevant to determining whether a will should be varied under wills variation provisions and the issue of adequate provision for an adult child.

In Inch v. Battie, 2007 BCSC 1249 it was stated:

It thus appears that, although transfers passing outside of the Will are not part of the estate, the effect of such gifts can be considered in determining to what extent, if any, the court should vary the distribution under the Will.

In DeLeeuw v. DeLeeuw, 2003 BCSC 1472, Masuhara J. did consider the assets transferred to the claimant, the surviving spouse, before the testator’s death, in determining whether he made adequate provision for her proper maintenance and support (at paragraphs 98 – 100).

In Ryan v. Delahaye Estate, 2003 BCSC 1081, D. M. Smith J. considered compensation provided to the testator’s son for his devotion during the parents’ lifetime, and an interest-free loan made to him, in determining if there was proper maintenance and support for the other child. I thus conclude that, although inter vivos dispositions, and assets passing as a result of a right of survivorship pass outside the estate, and are thus not subject to a claim under the Wills Variation Act, the court can consider them when assessing, from the perspective of a judicious person, in the circumstances, whether a parent has met her moral obligations to an adult child.