Admission of Extrinsic Evidence in Wills Interpretation Post WESA

Zalechuk Estate 2023 BCSC 523 discussed the modern approach to wills interpretation post WESA.

The Court’s power to rectify a will is found in s. 59 of the WESA:

59 (1) On application for rectification of a will, the court, sitting as a court of construction or as a court of probate, may order that the will be rectified if the court determines that the will fails to carry out the will-maker’s intentions because of

(a) an error arising from an accidental slip or omission,
(b) a misunderstanding of the will-maker’s instructions, or
(c) a failure to carry out the will-maker’s instructions.
(2) Extrinsic evidence, including evidence of the will-maker’s intent, is admissible to prove the existence of a circumstance described in subsection (1).
(3) An application for rectification of a will must be made no later than 180 days from the date the representation grant is issued unless the court grants leave to make an application after that date.

(4) If the court grants leave to make an application for rectification of a will after 180 days from the date the representation grant is issued, a personal representative who distributes any part of the estate to which entitlement is subsequently affected by rectification is not liable if, in reasonable reliance on the will, the distribution is made
(a) after 180 days from the date the representation grant is issued, and
(b) before the notice of the application for rectification is delivered to the personal representative.
(5) Subsection (4) does not affect the right of any person to recover from a beneficiary any part of the estate distributed in the circumstances described in that subsection.

In Thiemer Estate, 2012 BCSC 629 which also predated the coming into force of the WESA, Justice Dardi summarized some useful principles of construction. She said that the objective of the court is to ascertain the intention of the testator as expressed in his or her will when it is read as a whole in light of any properly admissible extrinsic evidence. The testator’s intention is to be gathered from the will as a whole and not solely from the provisions in dispute (para. 45 citing Perrin v. Morgan, [1943] A.C. 399 at 406 (H.L.) and (H.L.); Re: Burke (1960), 20 D.L.R. (2d) 396 at 398-399 (Ont. C.A.).

The court is to ascertain the express intention of the testator which is the meaning of the written word as opposed to what the testator may have meant to do when he or she made a will (Thiemer at para. 46 citing Perrin at 406).
Earlier lines of authority endorsed an objective approach to will interpretation but modern jurisprudence recognizes a strict literal approach can defeat the intention of the testator (Thiemer at para. 47, citing “The Law Reform Commission of British Columbia”, Report on Interpretations of Wills, LRC 58 at 6).
[68] At para. 48 Justice Dardi said:

[48] In keeping with contemporary judicial thinking, the courts of this province have favoured the subjective approach to interpreting wills, wherein the objective is to ascertain the actual meaning the testator ascribed to the words he or she used in the will. In determining the testator’s intention the courts have endorsed the analytical approach commonly described as the “armchair rule”. The rule requires that the court put itself in the position of the testator at the point in time when he or she made the will, and from that vantage point construe the language in the will in light of the surrounding facts and circumstances known to the testator.
In Jamt Estate, 2021 BCSC 788, ss. 58 and 59 of the WESA is discussed by Justice Coval. He says that s. 58 is remedial in nature covering a broad discretion in prescribed circumstances to order a writing or marking on a will be fully effective. Section 59, like s. 58 is remedial in nature conferring a broad discretion to rectify a will that fails to carry out the makers intentions in prescribed circumstances. Prior to the enactment of the WESA there was no such statutory authority in British Columbia to rectify wills and common law rectification had very narrow boundaries.

Since there were no judicial considerations of s. 59(1)(a) Justice Coval took guidance from the United Kingdom decision in Re Segelman [1996] Ch. 171 at p. 180 which considered similar but not identical sections of the Administration of Justice Act 1982. He raised three questions:

1) what were the testator’s intentions with regard to the issue for which rectification is sought?
2) does the Will as written fail to carry out those intentions?
3) is that failure a consequence of one of the reasons specified in ss. 59(1)(a)-(c).

Justice Coval concluded that the extrinsic evidence strongly supported granting the rectification sought under s. 59(1). He concluded that Mr. Jamt intended to leave his estate to the petitioner. The accidental slip had been the use of the wrong middle name for the petitioner.

Section 59(2) of the WESA admits extrinsic evidence to prove the circumstances described in s. 59(1) if the court is of the view that the will fails to carry out the will-maker’s intentions because of an error arising from an accidental slip or omission or a misunderstanding or failure to carry out the will-maker’s instructions. Since the Will was prepared by the deceased, I will only consider whether there has been an accidental slip or omission.

In Simpson, the Court of Appeal applied s. 59 to rectify a will in a case where they found a denial of rectification in those particular circumstances would deprive the respondents of the gift the deceased intended them to have, and provide the appellant with a windfall the deceased never intended her to have. An accidental omission arose from the deceased’s failure to realize that his intended gift of the shares would never get to the respondents due to the operation of the survivor clause of the shareholders agreement.

The trial judge allowed the extrinsic evidence of the drafting solicitor’s notes to determine what the testator’s intentions were.
The majority of the Court of Appeal allowed the rectification.

Vancouver Estate Lawyer-Rebutting the Presumption of Undue Influence

Trevor Todd and Jackson Todd have over 60 years experience in handling contested estate matters including undue influence.

Undue influence is an equitable doctrine used to protect persons from victimization at the hands of others. Equity will set aside transfers brought about by undue influence: Geffen v. Goodman Estate, [1991] 2 S.C.R. 353 at 368, 1991 CanLII 69.

In Stewart v. McLean, 2010 BCSC 64, Justice Punnett considered undue influence.

At para. 92, he noted that the presumption of undue influence arises for gratuitous transfers when a plaintiff establishes that the potential for influence exists or existed in the relationship. In Geffen at 377, Justice Wilson provided a definition of influence:

It seems to me rather that when one speaks of influence one is really referring to the ability of one person to dominate the will of another, whether through manipulation, coercion, or outright but subtle abuse of power…. To dominate the will of another simply means to exercise a persuasive influence over him or her. The ability to exercise such influence may arise from a relationship of trust or confidence but it may arise from other relationships as well.

Justice Punnett also referred to Longmuir v. Holland, 2000 BCCA 538, at para. 71, where Justice Southin defined undue influence as “influence which overbears the will of the person influenced so that in truth what she does is not his own mind.

To rebut the presumption of undue influence, the defendant must show that the donor gave the gift as a result of her own “full, free and informed thought:” Geffen at 379. A defendant could establish this by showing:

a) No actual influence was used in the particular transaction or the lack of opportunity to influence the donor (Geffen at 379; Longmuir at para. 121);

b) The donor had independent advice or the opportunity to obtain independent advice (Geffen at 379; Longmuir at para. 121);

c) The donor had the ability to resist any such influence (Calbick v. Warne, 2009 BCSC 1222 at para. 64);

d) The donor knew and appreciated what she was doing (Vout v. Hay, [1995] 2 S.C.R. 876 at para. 29); or

e) Undue delay in prosecuting the claim, acquiescence or confirmation by the deceased (Longmuir at para. 76).

Another relevant factor may be the magnitude of the benefit or disadvantage (Geffen at 379; Longmuir at para. 121).

 

Campbell Estate (Re), 2022 BCSC 2184 at paras. 213–217 court stated:

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]

[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.

[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.]

Court Delay & Dismissal Want of Prosecution

Many court actions, including estate litigation  are commenced and then just ” sit there” often for years  such that  inordinate delay can occur.

After certain criteria are met, typically the defendant will apply to the court for dismissal of the plaintiff’s court action for want of prosecution.

In Drennan v. Smith, 2022 BCCA 86  the Court of Appeal summarized principles to be considered on an application for dismissal for want of prosecution at para. 16 as follows:

Relevant factors for consideration are summarized in Wiegert v. Rogers, 2019 BCCA 334:

On an application to dismiss for want of prosecution, it must be shown that

1)there has been inordinate delay,

2)that the inordinate delay is inexcusable,

3) and that the delay has caused, or is likely to cause, serious prejudice to the defendant.

4) In addition, the final and decisive question, which encompasses the other three, is whether, on balance, justice requires a dismissal of the action: Azeri v. Esmati-Seifabad, 2009 BCCA 133 at para. 9; 0690860 Manitoba Ltd. v. Country West Construction Ltd., 2009 BCCA 535 at paras. 27-28.

Inordinate delay is defined in Drennan at para. 16 (citing para. 32 of Wiegert v. Rogers, 2019 BCCA 334 [Wiegert]) as follows:

…Inordinate delay is delay that is immoderate, uncontrolled, excessive and out of proportion to the matters in question: Azeri at para. 8; Sahyoun v. Ho, 2015 BCSC 392 at para. 17. As Justice Saunders explained in Sun Wave Forest Products Ltd. v. Xu, 2018 BCCA 63 at para. 25, the concept is relative: some cases are naturally susceptible of fast carriage or call for more expeditious prosecution than others. Although there is no universal rule as to when time starts to run, the date of commencement of the action is typically identified as the point from which delay is measured. The delay should be analysed holistically, not in a piece-meal fashion, and the extent to which it may be excusable is highly fact-dependent: Ed Bulley Ventures Ltd. v. The Pantry Hospitality Corporation, 2014 BCCA 52 at para. 38; 0690860 at para. 29.

The plaintiff’s diligence and dispatch in advancing the action is relevant to whether a delay is inordinate. Plaintiffs have a particular onus to move expeditiously when a case involves serious allegations that go to a defendant’s character and credit, see Extra Gift Exchange Inc. v. Accurate Effective Bailiffs Ltd., 2015 BCSC 915 [Extra Gift Exchange Inc.].
In considering the issue of whether there has been inordinate and inexcusable delay, the court is entitled to consider the conduct of the defence contributing to that delay, see Tundra Helicopters Ltd. v. Allison Gas Turbine, 2002 BCCA 145 at para. 21 [Tundra].

The burden is on the applicant to establish that there has been inordinate and inexcusable delay. Once the applicant has established inordinate and inexcusable delay, a rebuttable presumption of prejudice arises:

Once a defendant establishes that delay is inordinate and inexcusable, a rebuttable presumption of prejudice arises: Busse v. Chertkow, 1999 BCCA 313 at para. 18. The concern is with the prejudice that a defendant will suffer in mounting and presenting a defence if the matter goes to trial: 0690860 at para. 27. Relevant matters could include failing memories, unavailable witnesses and the loss or destruction of physical evidence.

Drennan at para. 16 (citing para. 33 of Wiegert).

The final and overriding question is whether the interests of justice require dismissal of the action, see Drennan para. 16 (citing para. 33 of Wiegert):

…As to the final consideration — whether, on balance, justice requires dismissal of the action — again, the determination is highly fact-dependent. Relevant matters could include the length of and reasons for the delay, the stage of the litigation, the context in which the delay occurred and the role of counsel in causing the delay (although negligence on the part of a plaintiff’s lawyer may not always amount to an excuse): International Capital Corporation v. Robinson Twigg & Ketilson, 2010 SKCA 48 at para. 45; 0690860 at para. 29.

Four questions are to be addressed in an application to dismiss for want of prosecution:

1. Has there been inordinate delay on the part of the plaintiff in pursuing its claim?
2. Has the delay been inexcusable?
3. Has the delay caused serious prejudice, or is it likely to cause serious prejudice to the defendants?
4. Does the balance of justice require an order dismissing the plaintiff’s claim?
Extra Gift Exchange Inc., at para. 41.

Removal of Lawyer Refused

Jiwani v Jiwani @022 BCCA 451 refused to remove a lawyer for a potential conflict of interest stating that the role of the lawyer was not the basis of the court action, it was instead the enforceability of the marriage agreement turned on whether the appellant husband Mr. Jiwani truthfully disclosed his financial affairs to his wife.

The lawyer’s advice to the respondent in respect of the marriage agreement had not been put in issue.

The Law

In summary, the court has an inherent jurisdiction to remove a lawyer from the record who has a conflict of interest, including a lawyer who may be a witness in a case where they act as counsel (see Ontario Realty Corp. v. Gabriele & Sons Limited, [2006] O.J. No. 4497 (Ont. S.C.J.) at para. 16 and MacDonald Estate v. Martin, [1990] 3 S.C.R. 1235 at para. 18).
The concern that arises when a lawyer testifies is there may be a conflict of interest between the client and the lawyer, and the administration of justice can be impaired by a conflict in the lawyer’s obligation of objectivity to the court, and their obligation as an advocate to the client.

The factors the court considers include:

(a) maintaining the high standard of the legal profession and the integrity of the justice system; and
(b) the right of a litigant to counsel of choice, which they should not be deprived of without good cause (Ontario Realty at para. 17, citing MacDonald Estate at para. 12)

The test to be applied is whether a fair minded reasonably informed member of the public would conclude that a proper administration of justice requires the removal of the lawyer (Ontario Realty at para. 20; Karas et al. v. Her Majesty the Queen et al., 2011 ONSC 5181 at para. 26).

The cases have recognized that when a litigant is deprived of a lawyer of their choice, a hardship may arise, which can only be justified to prevent a more serious injustice (see for example Urquhart v. Allen Estate, [1999] O.J. No. 4816 (Ont. S.C.J.).

While certainty that a lawyer will be called as a witness is not required, the applicant must establish it is likely that counsel can provide material evidence: Ontario Realty at paras. 34-35. In Gichuru v. Purewal, 2017 BCCA 281 at para. 17, the Court of Appeal characterized a removal order as an extraordinary remedy, to be approached with great caution and rarely invoked.

BC Estate Lawyer-Removal of an Executor/Trustee 2023

Trevor Todd and Jackson Todd have over 60 years experience in handling contested estate matters including  dealing with difficult executors and having them removed when appropriate..

 

It is difficult to remove and substitute an alternate executor/trustee as a will-maker has the right to choose their executor and trustee.

That choice is entitled to deference and will only be interfered with if there is clear and cogent evidence to do so. In Parker v. Thompson (Trustee), 2014 BCSC 1916, Hinkson, C.J.S.C. stated:

In Haines v. Haines, 2012 ONSC 1816 at para. 10 as equally applicable to the removal of the trustee:

In Johnson v. Lanka, 2010 ONSC 4124, (2010), 103 O.R. (3d) 258 at para. 15, Pattillo J. summarized the principles that should guide the court’s discretion in deciding whether to remove estate trustees:

(a) the court will not lightly interfere with the testator’s choice of estate trustee;
(b) clear evidence of necessity is required;
(c) the court’s main consideration is the welfare of the beneficiaries; and
(d) the estate trustee’s acts or omissions must be of such a nature as to endanger the administration of the trust.

See also Burke v. Burke, 2019 BCSC 383 at para. 29.

In addition, “not every actual or perceived conflict should lead to disqualification of an executor”. Each case turns on its own facts: Burke at para. 43.
s. 30 of the Trustee Act, R.S.B.C. 1996, c. 464 [Trustee Act] . Section 30 states:

Removal of trustees on application

S.30 Trustee Act provides:

A trustee or receiver appointed by any court may be removed and a trustee, trustees or receiver substituted in place of him or her, at any time on application to the court by any trust who is not under legal disability, with the consent and approval or a majority in interest and number of the trust beneficiaries who are also not under legal disability.

s. 31 of the Trustee Act provides the authority needed to replace the executor. Section 31 provides:

Power of court to appoint new trustees

31 If it is expedient to appoint a new trustee and it is found inexpedient, difficult or impracticable to do so without the assistance of the court, it is lawful for the court to make an order appointing a new trustee or trustees, whether there is an existing trustee or not at the time of making the order, and either in substitution for or in addition to any existing trustees.

s. 158 and 159 of WESA also provides for the removal or passing over of a personal representative.

In Dahle Estate (Re), 2021 BCSC 718 at para. 20 there are four categories of conduct by an executor that will warrant their removal:

(1) endangerment of trust property;
(2) want of honesty;
(3) want of proper capacity to execute the duties; and
(4) want of reasonable fidelity.

The Admissibility of Hearsay Statements of a Deceased

It is a fact that estate litigation is rife with hearsay evidence, often “from” the deceased  and if certain criteria are met, such evidence is admissible.

In Peterson v. Welwood, 2018 BCSC 1379 at paras. 69-8o the court considered the admissibility of statements of the deceased:

In Gutierrez v. Gutierrez, 2015 BCSC 185 at para. 34 the court summarized the factors that can be considered when assessing the threshold reliability of a hearsay statement:

1) the presence or absence of a motive to lie

2) independent corroborative evidence that “goes to the trustworthiness of the statement” (Blackman at para. 55; Khelawon at para. 67; R. v. Couture, 2007 SCC 28 (S.C.C.) at para. 83);

3) timing of the statement relevant to the event, contemporaneity (Khelawon at para. 67);

4) the declarant’s mental capacity at the time of making the statement (Khelawon at para. 107);

5) solemnity of the occasion and whether the declarant’s statement was made “in circumstances that could arguably be akin to the taking of an oath where the importance of telling the truth and the consequences of making a false statement were properly emphasized” (Couture at para. 89; Khelawon at para. 86).

It is important to recognize that, as a preliminary threshold issue, the court must first find on a balance of probabilities that the statement was in fact made by a deceased declarant before it goes on to determine the treatment and weight of such evidence: Creutz v. Estate of Kristian Winther, 2007 BCSC 1463 at para. 99.

This assessment turns on the credibility of the witnesses who relate to the court the hearsay statements attributed to the deceased declarant: Halfpenny v. Holien (1997), 37 B.C.L.R. (3d) 186 (S.C.).

Binding Oral Contracts

While it is obviously more advantageous for the enforceability of a contract to be in writing, an oral contract can be just as valid as written contract if the necessary criteria are met.

In Oswald v. Start Up SRL, 2021 BCCA 352 at para. 34 , the court set out the legal test for the formation of a binding and enforceable contract:

(a) there must be an intention to contract;

(b) the essential terms must be agreed to [by] the parties;

(c) the essential terms must be sufficiently certain;

(d) whether the requirements of a binding contract are met must be determined from the perspective of an objective reasonable bystander, not the subjective intentions of the parties; and

(e) the determination is contextual and must take into account all material facts, including the communications between the parties and the conduct of the parties both before and after the agreement is made.

Part (d) of the Oswald test summarizes “what has been called the objective principle of contract formation”: Summers v. Sawyer, 2005 CanLII 30880, 2005 CarswellOnt 4001 (S.C.) at para. 15 [Summers]. In Summers, the court adopted the following passage from S. M. Waddams, The Law of Contracts, 5th ed. (Toronto: Canada Law Book, 2005) at 103, which elaborates on this principle:

The principle function of the law of contracts is to protect reasonable expectations engendered by promises.

Every definition of contract, whether based on agreement or on promise, includes a consensual element. But the test of whether a promise is made, or of whether assent is manifested to a bargain, does not and should not depend on an inquiry into the actual state of mind of the promisor, but on how the promisor’s conduct would strike a reasonable person in the position of the promisee.

The Summers court also cited the following passage from Smith v. Hughes (1871), L.R. 6 Q.B. 597 at 607, which states the objective principle of contract formation another way:

If, whatever a man’s real intention may be, he so conducts himself that a reasonable man would believe that he was assenting to the terms proposed by the other party, and that other party upon that belief enters into a contract with him, the man thus conducting himself would be equally bound as if he had intended to agree to the other party’s terms.
See also Hucul v. GN Ventures Ltd., 2022 BCSC 144 at para. 136.

In Summers, the court concluded there was an oral agreement between the three shareholders of a trucking company that was unable to start a business due to a lack of financing. As a result, the shareholders were each responsible for one-third of the company’s start-up expenses.
Reeves v. Russell, 82 R.P.R. (4th) 137, 2009 CanLII 11437 (Ont. S.C.) Is a good example of a case where a court found an enforceable oral agreement had been formed in the context of the formation of a business.

Committeeship Criteria ( Patients Property Act)

Mok v Wom 2022 BCCA 418 confirmed the criteria for appointing a committee of a mentally  infirmed patient’s estate and/or person.

 

An application for appointment of committee of the person invokes the parens patriae jurisdiction of the court. It is an inherently discretionary and fact specific assessment, governed by the overriding concern of who will serve the patient’s best interests.

Section 18(1) of the Patients Property Act ( PPA) states:

A committee must exercise the committee’s powers for the benefit of the patient and the patient’s family, having regard to the nature and value of the property of the patient and the circumstances and needs of the patient and the patient’s family.

Though the PPA does not provide a specific test to be used in determining who should be a committee, the courts have developed criteria to guide the exercise of discretion in making such an appointment. The court in Stewart (Re) summarized some of these considerations as follows at para. 29:

[29]      … However, cases have identified various considerations; see for example: Vranic (Re), 2007 BCSC 1949; Bowman (Re), 2009 BCSC 523; Palamarek (Re), 2011 BCSC 563; Re Matthews, 2013 BCSC 1045; and Sangha (Re), 2013 BCSC 1965. They include:

(a)  whether the appointment reflects the patient’s wishes, obviously when he or she was capable of forming such a wish;

(b)  whether immediate family members are in agreement with the appointment;

(c)  whether there is any conflict between family members or between the family and the patient, and whether the proposed committee would be likely to consult with immediate family members about the appropriate care of the patient;

(d)  the level of previous involvement of the proposed committee with the patient, usually family members are preferred;

(e)  the level of understanding of the proposed committee with the patient’s current situation, and will that person be able to cope with future changes of the patient;

(f)   whether the proposed committee will provide love and support to the patient;

(g)  whether the proposed committee is the best person to deal with the financial affairs and ensure the income and estate are used for the patient’s benefit;

(h)  whether a proposed committee has breached a fiduciary duty owed to the patient, or engaged in activity which diminishes confidence in that person’s abilities to properly handle the patient’s affairs;

(i)    who is best to advocate for the patient’s medical needs;

(j)    whether the proposed committee has an appropriate plan of care and management for the patient and his or her affairs and is best able to carry it out; and

(k)  whether a division of responsibilities such as between the patient’s estate and the patient’s person to different persons would serve the best interests of the patient, or would such a division be less than optimal for the patient.

A judge’s discretion in this assessment is broad; there is no formula that must be rigidly applied. A judge’s decision will often be exercised against a complex set of facts, and will typically have to weigh and balance multiple considerations, some of which may be in tension, and may support, standing alone, different outcomes. Moreover, these kinds of decisions often have to respond to exigent circumstances. Courts need to be able to act decisively to protect the interests of patients. There is a powerful imperative to achieve certainty and finality.

 

 

BC Lawyer- Loan or Gift From Mom/ Dad To Newly Weds

Trevor Todd and Jackson Todd have over sixty years combined experience in handling contested estates including whether monies advanced from parents to a child and his/her spouse  is a gift or a loan

 

I previously wrote on the “bank of mom and dad” and how they had an almost %100 failed collection rate when the wedding “gift” suddenly turns into a loan after the  marriage fails.

 

Whether the advancement of funds from one party to another is a loan or a gift is a common theme in estate litigation and more so when it involves families and money.

 

The courts have more frequently than not found that the out of luck parents intended a gift when the monies were advanced and not a loan.

 

Typically since it is family, the details are not documented and signed . The parents attitude is often that it is a gift so long s the marriage holds and if not, we want our money back.

 

In Zucker v Zucker 2022 BCSC 2025 the parents did the usual thing of advancing monies to a child and his spouse for them to buy a home. There was a mortgage and a signed promissory note.

The child of the parents agreed with them at trial that the monies were advanced as a loan but the spouse argued that it was a gift.

Based on some unique evidence the court held that the parents intended a loan.

 

At para. 43, the court noted that in Kuo v. Chu, 2009 BCCA 405 (B.C. C.A.) at para. 9, the Court of Appeal adopted the following factors from Locke v. Locke, 2000 BCSC 1300 (B.C. S.C.), as applicable to the question of whether a loan or a gift was intended:

(a) Whether there were any contemporaneous documents evidencing a loan;

(b) Whether the manner for repayment is specified;

(c) Whether there is security held for the loan;

(d) Whether there are advances to one child and not others, or advances of unequal amounts to various children;

(e) Whether there has been any demand for payment before the separation of the parties;

(f) Whether there has been any partial repayment; and,

(g) Whether there was any expectation, or likelihood, of repayment.
The court firstly attempted to determine the actual intention of the transferors on the balance of probabilities.
The court starts with the presumption of a resulting trust, and weighs the evidence in an attempt to ascertain the transferors actual intention .
The presumption of resulting trust only applies where there is insufficient evidence to rebut it on a balance of probabilities ( Pecore v Pecore 2007 SCC 44.
Since the inquiry focuses on the intention of the transferors the state of knowledge of the opposing spouse about the transaction is not determinative ( Tobias v Tobias 2016 BCSC 125 at 42)
The court seized on the unusual fact that the defendants at one point transferred the title to one of the parents finding that such an act was persuasive reliable circumstantial evidence that the plaintiffs did not intend the monies to be a gift.
The defendants also partially repaid the monies and a partial repayment can be evidence that a loan was intended.  Kuo v Cho 2009 BCCA 405 at para.9
The court found that the defendants were liable to the plaintiffs on the basis of a resulting trust.

The Law of Set -Off

Blacks Law dictionary defines set-off as a counterclaim demand which a defendant holds against the plaintiff, arising out of the transaction extrinsic of the plaintiff’s cause of action. The defendant seeks to cancel the amount due from him or to recover a mountain in excess of the plaintiff’s claim against him.

Coba Industries Ltd. v. Millie’s Holdings (Canada) Ltd., 1985 CanLII 144 correctly summarizes the applicable principles for a valid claim of set-off:

1. The party relying on a set-off must show some equitable ground for being protected against his adversary’s demands.
2. The equitable ground must go to the very root of the plaintiff’s claim before a set-off will be allowed.
3. A cross-claim must be so clearly connected with the demand of the plaintiff that it would be manifestly unjust to allow the plaintiff to enforce payment without taking into consideration the cross-claim.
4. The plaintiff’s claim and the cross-claim need not arise out of the same contract.
5. Unliquidated claims are on the same footing as liquidated claims.
[citations omitted]

Similarly the Court of appeal in Wilson v. Fotsch, 2010 BCCA 22 described law of equitable set

off as being available provided that there is a relationship between the cross-obligations such that

it would be unfair or inequitable to permit one to proceed without taking the opposing claim into account.

The requirements for a claim of equitable set-off are as follows:

1. The party relying on a set-off must show some equitable ground for being protected against his adversary’s demands;

2. The equitable ground must go to the very root of the plaintiff’s claim before a set-off will be allowed;

3. A cross-claim must be so clearly connected with the demand of the plaintiff that it would be manifestly unjust to allow the plaintiff to enforce payment without taking into consideration the cross-claim;

4. The plaintiff’s claim and the cross-claim need not arise out of the same contract; and

5. Unliquidated claims are on the same footing as liquidated claims.