Category: WESA Procedures

Extrinsic Evidence Admissible To Determine Intention in S. 58 WESA

In Re Hadley Estate 2017 BCCA 311the Court of Appeal underscored the importance of evidence, including extrinsic evidence to determine testamentary intention in S.58 WESA applications to remedy a defective “will”.

40. Sitting as a court of probate, the court’s task on a s. 58 inquiry is to determine, on a balance of probabilities, whether a non-compliant document embodies the deceased’s testamentary intentions at whatever time is material.

The task is inherently challenging because the person best able to speak to these intentions — the deceased — is not available to testify. In addition, by their nature, the sorts of documents being assessed will likely not have been created with legal assistance.

Given this context and subject to the ordinary rules of evidence, the court will benefit from learning as much as possible about all that could illuminate the deceased’s state of mind, understanding and intention regarding the document.

Accordingly, extrinsic evidence of testamentary intent is admissible on the inquiry: Langseth Estate v. Gardiner (1990), 75 D.L.R. (4th) 25 at 33 (Man. C.A.); Yaremkewich Estate (Re) at para. 32; George. As is apparent from the case authorities, this may well include extrinsic evidence of events that occurred before, when and after the document was created: see, for example, Bennett; George; Estate of Young; Re MacLennan Estate (1986), 22 E.T.R. 22 at 33 (Ont. Surr. Ct.); Caule v. Brophy (1993), 50 E.T.R. 122 at paras. 37-44 (Nfld. S.C.).

S.59 WESA Order Made After 180 Days Post Probate

Wills Drafting- The Myth of the “Simple Will” _ Disinherited

Simpson v Zaste 2022 BCCA 208 was an appeal from an order granting leave to rectify a will under S 59 WESA, after the 180 day limitation period of the wills variation provisions under section 60, and to rectify a will pursuant to section 59 of WESA.

The appeal court allowed the appeal in part and granted leave, but the rectification was set aside and substituted.

The deceased had intended to gift certain shares to his children that were subject to a shareholder agreement requiring his personal representative to sell the shares to the other shareholder at fair market value, less the amount of a life insurance policy in favor of the appellant widow.

The deceased fail to recognize that the effect of the shareholders agreement was that the gift would fail and his estate would receive an unintended windfall.

The children out of time for a wills variation claim successfully brought an application for rectification to receive the gross value of the shares, including the value of the life insurance policy.

The appeal court found that the judge erred by failing to recognize the prejudice to the appellant to be out of time to bring her own variation claim upon rectification of the will.

The judge erred further in speculating that the deceased intended his children to receive the gross value of the shares when the evidence indicated that the children were only to receive the shares as encumbered, and the widow was to receive the proceeds of the life insurance policy.

Given the merits of the claim however it was in the interests of justice to grant leave and rectify the will to gift the net value of the shares to the children.

S. 151 WESA- Leave To Bring Action On Behalf of Estate

Mischke v. Mischke Estate 2021 BCSC 1404 dealt with a S. 151 WESA application for leave by a beneficiary of their mother’s estate to commence an action on behalf of the estate against the executor and another sibling for alleged breach of trust for missing funds while the executor and the sibling handled a power of attorney for the deceased.

The Court refused the application on the basis that no arguable case had been presneted and reviewed the criteria for a S. 151 application.

The Law- S. 151 WESA

A beneficiary under a will who is of the view that litigation should be brought on behalf of an estate in a situation where the executor is unwilling to do so may seek leave of the court to commence proceedings under s. 151 of the WESA.

The relevant portions of this provision read as follows:

151 (0.1) In this section, “specified person” means a beneficiary, an intestate successor or a person who may commence a proceeding claiming the benefit of Division 6 [Variation of Wills] of Part 4 [Wills].

151 (1) Despite section 136 [effect of representation grant], a specified person may, with leave of the court, commence proceedings in the name of the specified person and on behalf of the estate of the deceased person

(a) to recover property or to enforce a right, duty, or obligation owed to the deceased person that could be recovered or enforced by the personal representative, or
(b) to obtain damages for breach of a right, duty or obligation owed to the deceased person.

151(3) The court may grant leave under this section if

(a) the court determines the specified person seeking leave
(i) has made reasonable efforts to cause the personal representative to commence or defend the proceeding,
(ii) has given notice of the application for leave to
(A) the personal representative,
(B) any other specified persons, and
(C) any additional person the court directs that notice is to be given, and
(iii) is acting in good faith, and

(b) it appears to the court that it is necessary or expedient for the protection of the estate or the interests of a specified person for the proceeding to be brought or defended.

In Malecek v. Leiren, 2021 BCSC 1052 at para. 40, Mr. Justice Giaschi conveniently set out the five conditions that must be satisfied by an applicant in order to obtain leave to bring a s. 151 WESA beneficiary action:

the applicant must be a “specified person” within the meaning of the section;
reasonable efforts must have been made to have the executor commence the proceedings;
notice must have been given to the required persons;
the applicant must be acting in good faith; and,
the court must be satisfied it is necessary or expedient for the proceedings to be brought.

Efforts to Have the Executor Bring the Proposed Proceeding

In situations where proposed beneficiary proceedings are to be brought against executors, it is not self-evident what would constitute “reasonable efforts” to cause executors to start such actions against themselves. This issue was canvassed at some length in Fry v. Fry, 2018 BCSC 1018 at paras. 49 to 58. The s. 151 WESA applicant in that case had essentially argued that when an executor is intended to be a defendant in the proposed proceeding and is therefore in an inherent conflict of interest, it would be nonsensical to require the applicant to first try to persuade the executor to commence such litigation. However, based on the wording of s. 151 and case law that has interpreted a similar provision in corporate legislation, Mr. Justice Milman concluded that the applicant must still give the executor reasonable notice of the request together with details of the nature of the claim that the applicant wishes the executor to pursue. At para. 57, he wrote:

In summary, I conclude that in a case such as this where the personal representative is an intended defendant, the applicant must, before commencing an action in the name or on behalf of the estate or seeking leave to do so:

(a) inform the personal representative of the specific allegations being made; and
(b) request that the personal representative take, or allow others to take, specific remedial action to address them.

While the precise form that such a notice and request for action requires will vary and is dependent upon the context, failure to make a reasonable effort to meet this requirement will be fatal to the application (Fry v. Fry, 2018 BCSC 1018, at para. 58).

The Applicant’s Good Faith

The s. 151 WESA applicant has the burden to demonstrate that the proposed proceeding is being brought in good faith. Evidence of the applicant’s motivation must be presented, as good faith cannot be presumed. Once again, Fry v. Fry, 2018 BCSC 1018, is instructive:

The requirement in s. 151(3)(a)(ii) that the applicant be acting in good faith was explained by Pearlman J. in the context of an application for leave to commence a derivative action in Luft v. Ball, 2013 BCSC 574, as follows at para. 46:

The applicant bears the onus of establishing that it is acting in good faith in bringing derivative proceedings. Good faith is not presumed; the applicant must adduce evidence to establish good faith: Creative Realty Corp. v. 333 Terminal Holdings Ltd., 2011 BCSC 638 at para. 19. The test of good faith is whether the action is brought primarily for the purpose of pursuing the claim on the company’s behalf. The factors to be considered include the applicant’s belief in the merits of the proposed claim, existing disputes between the parties, and alleged ulterior motives: Bennett v. Rudek, 2008 BCSC 1278 at para. 46. As Adair J. observed in Lost Lake Properties Ltd. [Lost Lake Properties Ltd. v. Sunshine Ridge Properties Ltd., 2009 BCSC 938] at para. 56, ultimately good faith is a question of fact to be determined on all of the evidence and the particular circumstances of the case.

The fact that the applicant may be motivated by self-interest will not disqualify that person from obtaining leave under s. 151 of the WESA. To the contrary, in light of the wording of s. 151(3)(b), good faith can be shown with evidence that the applicant is genuinely pursuing the proposed litigation for the benefit of the estate or out of the person’s own self-interest (Jiang v. Piccolo, 2020 BCSC 1584 at para. 69).

As with the “reasonable efforts to have the executor act” criterion, however, should the applicant fail to establish that the proposed proceeding is bona fide, leave to commence it will not be granted regardless of whether it may otherwise be meritorious.

Necessity or Expediency of the Proposed Proceeding

Section 151(3)(b) of the WESA provides that leave to bring a beneficiary proceeding can only be granted if it appears to the Court that it is “necessary or expedient for the protection of the estate or the interests of a specified person…”. Guidance on how to apply this provision was set out by Madam Justice Gray in Bunn v. Bunn Estate, 2016 BCSC 2146 at paras. 50-51:

A proceeding may be “necessary” under s. 151 of WESA if the personal representative is unwilling or unable to proceed. It may be “expedient” if it is in the best interests of the estate.

In this case, the applicant is a beneficiary of the Estate and seeks the order under s. 151 of WESA on the basis that the claim, if successful, will increase the value of the Estate. In such a case, in my view, to satisfy the court that it should exercise its discretion to grant leave to commence litigation on behalf of the estate, the applicant must show not only that there is an arguable case, but also that the potential relief in the action is sufficient to justify the inconvenience to the estate of being involved in the action, and that proceeding is overall in the best interests of the estate. In my view, that must involve a consideration of the costs of proceeding, including the potential of a costs award against the estate if it fails. Further, in my view, in determining whether the proposed lawsuit appears to be in the best interests of the estate, the court can consider the strength of the proposed claim based on a limited weighing of the evidence.

In other words, when considering whether leave should be granted on a s. 151 WESA application, it is permissible and expected for the Court to assess the evidentiary material tendered by the parties by performing a “limited weighing” of this evidence.

However, the Court cannot decide the merits of the case or deal with issues of credibility (Hoggan v. Silvey, 2021 BCSC 971, at para. 24). The assessment relates in particular to three interrelated questions: (1) is there an arguable case; (2) does the potential relief/recovery justify the time and expense of the proposed action; and (3) is the proceeding in the overall best interest of the estate (Malecek v. Leiren, 2021 BCSC 1052 at para. 44).

S 150(2) WESA Allows Family Claim After Death

Weaver Estate v Weaver 2021 BCSC 881 allowed the personal representative of the deceased spouse as provided for by S 150(2) WES to commence the family law action for division of spousal assets.

The Claimant sough an order for equal division of family property and family debt under the Family Law Act, S.B.C. 2011, c. 25 (“FLA”) as well as an interest in three real properties as described in the NOFC, located in Delta, British Columbia, Washington State, USA, and Hawaii, USA.

The Respondent filed a jurisdictional response in the family law case , moved to dismiss it, but the judge allowed such a proceeding.

The relevant portions of s. 198(2) Family Law act are as follows:

Time limits

198 (2) A spouse may start a proceeding for an order under Part 5 [Property Division] to divide property or family debt, Part 6 [Pension Division] to divide a pension, or Part 7 [Child and Spousal Support] for spousal support, no later than 2 years after,

(a) in the case of spouses who were married, the date
(i) a judgment granting a divorce of the spouses is made, or
(ii) an order is made declaring the marriage of the spouses to be a nullity, or
(b) in the case of spouses who were living in a marriage-like relationship, the date the spouses separated.

There is interplay between WESA and the FLA, as reflected in Section 150 of WESA provides:

Proceedings by and against estate WESA

150 (1) Subject to this section, a cause of action or a proceeding is not annulled by reason only of the death of

(a) a person who had the cause of action, or
(b) a person who is or may be named as a party to the proceeding.

(2) Subject to this section, the personal representative of a deceased person may commence or continue a proceeding the deceased person could have commenced or continued, with the same rights and remedies to which the deceased person would have been entitled, if living.

(4) Recovery in a proceeding under subsection (2) does not extend to

(a) damages in respect of non-pecuniary loss, or
(b) damages for loss of future income for a period following death.
(5) A person may commence or continue a proceeding against a deceased person that could have been commenced or continued against the deceased person if living, whether or not a personal representative has been appointed for the deceased person.
(6) A proceeding under subsection (5) may be commenced naming as defendant or respondent
(a) the personal representative, if any, or
(b) the deceased person.

(7) A proceeding under subsection (5) in which the deceased person is named as defendant or respondent is valid despite the fact that the deceased person is not living when the action or proceeding is commenced.

The court agreed with the commentary in the CLEBC Family Law Sourcebook for British Columbia at chapter 13.5 which states:

Through the combined operation of the Family Law Act and the WESA, where a spouse dies after separation, and action can be commenced either by the surviving spouse against the estate of the deceased or by the estate of the deceased against the surviving spouse.

Section 150 of WESA explicitly contemplates exclusions for certain proceedings and claims. Proceedings under the FLA are not excluded from the operation of s.150, either under WESA or the FLA itself.

Family Rule 20-6(1), (2), (3) and (8) specifically state that a family law proceeding may be commenced after the death of the person who had the cause of action by that person’s personal representative, if the cause of action survives.

The courts in British Columbia have confirmed that where spouses have separated, a spouse’s claim to family property survives the death of the spouse: Gibbons v. Livingston, 2018 BCCA 443 at para. 17; Howland Estate v. Sikora, 2015 BCSC 2248 at para. 27; Dowell Estate v. Dowell, 2009 BCCA 175 at para. 31; and Surrett v. Butkiewicz, 2018 BCSC 2194 at para 1. None of those cases, however, involved a claim commenced by a personal representative after the death of the claimant.
Both WESA and the Family Rule clearly state that it is not necessary that the claim be commenced in order to survive death. It is only that the deceased have a cause of action for the claim to survive.

Electronic Wills

Amendments to WESA due to the corona virus now enables the use of electronic wills and electronic witnessing of wills.

The amendments to WESA are basically those of sections 35 and 55 of the act relating to the witnessing and revocation of electronic wills.

One of the most significant aspects of the amendment is to make permanent the changes on remote witnessing of wills, so that, for example, if a person is under a disability, quarantine, lives in rural or remote communities, or would have difficulty attending a lawyers are notary’s office due to child care or other responsibility, will allow the use of technology for the witnessing a will by people who are in different locations.

The amendments will be deemed to have taken effect on March 18, 2020, the date in which the provincial state of emergency in relation to covid -19, was declared.

The second amendment will enable the courts to accept wills that are created on a computer and signed electronically and for which there is no printed copy.

Under the amendments and electronic will is defined as a will that is in electronic form. A will is an electronic form if it:

is recorded or stored electronically;
can be read by a person; and
is capable of being reproduced in a visible form.

An electronic will is signed by an electronic signature, which means information in electronic form that a person has created or adopted in order to sign a record. And that is in, attached to or associated with the record.

Under the amendments and electronic will is conclusively deemed to be signed if the electronic signatures in, attached to or associated with the will, so that is apparent the will maker intended to give effect to the entire will.

The amendments also give directions on how to alter or revoke an electronic will.

An electronic will is revoked only in one or more of the following circumstances:

by the will maker, or a person in the presence of the will maker and by the will maker’s direction, the leading one or more electronic versions of the will or of part of the will with the intention of revoking it;
by the will maker, or a person in the presence of the will maker and by the will maker’s direction, burning, tearing or destroying all or part of a paper copy of the will in some manner, in the presence of a witness, with the intention of revoking all or part of the will;
by any other act of the will maker, or another person in the presence of the will maker and by the will maker’s direction, if the court determines under section 58 ( relating to curing deficiencies that
the consequences of the act of the will maker or the other person is apparent;
the act was done with the intent of the will maker to revoke the will, in whole or in part.

A written declaration made in accordance with section 55 may be in electronic form and signed with an electronic signature.

For certainty, and in and for it in deletion of one or more electronic versions of a will or part of a will is not evidence of an intention to revoke the will.

Converting a Petition to an Action and Trial

Re Cameron 2020 BCSC 157 discusses the test to convert a petition to an action and to refer the matter to the trial list.

Under the Supreme Court rules many actions such as proof in solemn form actions must be commenced by petition, as opposed to notice of civil claim. ( See rules 1-2 (4) and 2-1(2)(b).)

When the petition is opposed it is necessary to apply to court to convert the petition to an action on the basis that there is a triable issue.

One of the leading case in British Columbia Milk Marketing Board v Saputo Products 2017 BCCA 247.

The Supreme Court chambers judge dismissed the application to convert the petition to an action and refer the matter to the trial list, and the Court of Appeal reversed that decision.

The appeal court stated that on the hearing of a petition, judge must be satisfied that there is no dispute as to the facts are law, which raises a reasonable doubt, or which suggests that there is a defense that deserves to be tried. If such a dispute exists, the judge may refer the matter to the trial is pursuant to rule 22 –1 (7) .

The test is not that used to determine a summary trial, but rather it is akin to that on an application for summary judgment under rule 9-6.

The cases do not establish an invariable rule as to what steps must be taken to resist a summary trial application.

On all such applications the issue is whether on the relevant facts and applicable law, there is a bona fide triable issue. The onus of establishing that there is not such an issue rests upon the applicant, and must be carried to the point of making it manifestly clear, which the court interpreted as much the same as beyond a reasonable doubt. If the judge hearing the application is left in doubt as to whether there is a triable issue, the application should be dismissed.

In essence, if the defendant is bound to lose, the application should be granted, but if he is not bound to lose then the application should be dismissed.

Thus the test for determining whether matter should be converted into an action is not that used for determining suitability for summary trial, but rather is akin to that applied on application for summary judgment. Accordingly, unless the judge is satisfied that there is no dispute as to the facts are law that raises a reasonable doubt, or which suggests that there is a defense that deserves to be tried, an application brought by convert petition should be converted into an action.

This approach was confirmed by the Court of Appeal in Kerfoot v Richter 2018 BCCA 238, which involved the petition to prove a will in solemn form. One of the deceased children oppose the application on the ground that the deceased lacked testamentary capacity and applied to have the petition converted into an action. The chambers judge dismissed the application, but the Court of Appeal reversed it, emphasizing that the test in Saputo required proceedings brought by petition to be referred to the trial list where there are disputes of fact or law, unless the party requesting the trial is bound to lose.

On the other hand, the party seeking to establish a triable issue cannot rely on “mere allegations”, and the court is entitled to draw inferences that are strongly supported by undisputed facts.

S. 58 WESA: 2 of 3 Notes Admitted as Will

In Bizicki Estate 2019 BCSC 2142 the court pursuant to section 58 WESA, the court admitted two of three notes into probate as the last will of the deceased.

The documents stated the deceased’s wish that his girlfriend receive the money in his bank accounts and other personal property, so as to constitute his deliberate or fixed and final intention as to the disposition of the remaining money in his bank accounts, following payment of funeral expenses and debts.

The application by his long time girlfriend was opposed by the deceased’s next of kin.

The deceased was a long time tenant of a room at a Seymour St. hotel in Vancouver, a bachelor and had no children.

He was unsophisticated and his long time girlfriend, the applicant could not read or write English.

She found three original notes on separate pieces of paper, with only one of them being dated, November 23, 2009.

One of the notes in particular, which the judge called the “money note”, directed that his monies be applied to pay off debts, and that monies left over are to be awarded to his girlfriend. He stated where his bank account was.

In that account he had approximately $272,000.

The court found that each of the notes was written in contemplation of death and addressed what will be done with his property when he is dead.

The court put importance on the fact that the deceased never previously made a will executed with the proper requirements of S 37 WESA.

There was no dispute that the handwriting on the three documents was that of the deceased, and this was also established their expert evidence.

The court followed the application of section 58, as set out in two decisions, namely Estate of Young 2015 BCSC 182 and Hadley Estate 2017 BC CA 311.

In Young estate the court stated:

“The burden of proof that a noncompliant document embodies the deceased testamentary intentions is a balance of probabilities. A wide range of factors may be relevant to establishing their existence in the particular case. Although context specific, these factors may include the presence of the deceased signature, the deceased’s handwriting, witness signatures, revocation of previous wills, funeral arrangements, specific bequests, and the title of the document.

While imperfect, or even noncompliance with formal testamentary requirements may be overcome by application of a sufficiently broad curative provision, the further a document departs from the formal requirements, the harder it may be for the court to find it embodies the deceased testamentary intention.”

valid will

Posthumous Births: Conception After Death

Section 8.1 of WESA provides as follows:

8.1 (1) A descendant of a deceased person, conceived and born after the person’s death, inherits as if the descendant had been born in the lifetime of the deceased person and had survived the deceased person if all of the following conditions apply:

(a) a person who was married to or in a marriage-like relationship with, the deceased person when that person died gives written notice, within 180 days from the issue of a representation grant, to the deceased person’s personal representative, beneficiaries and intestate successors that the person may use the human reproductive material of the deceased person to conceive a child through assisted reproduction;

(b) the descendant is born within 2 years after the deceased person’s death and lives for at least 5 days;

(2) The right of a descendant described in subsection (1) to inherit from the relatives of a deceased person begins on the date the descendant is born.

(3) Despite subsection(1)(b), a court may extend the time set out in that subsection if the court is satisfied that the order would be appropriate on consideration of all relevant circumstances.

Unlike section 8, which applies specifically to intestacy, section 8.1 applies to both testate and intestate estates.

Reproductive Genetic Material is Property

Lam v. University of British Columbia, 2015 BCCA 2, held that human sperm or ova stored for reproductive purposes are property.

Lam was a representative plaintiff of a class of cancer patients who, before taking radiation treatments, had stored their frozen sperm at the defendant’s laboratory.

All of the stored sperm was destroyed by reason of a power interruption. One of the issues at trial was whether the plaintiff had ownership of his sperm such that he could contract for its storage to enable his personal use of the sperm at a later date.

The court found that the sperm was included in the definition of “goods” under the Warehouse Receipt Act, that the storage facility was bound by the terms of that Act, and that its exclusion clause was unenforceable.

Consent After Death

In K.L.W. v. Genesis Fertility Centre, 2016 BCSC 1621, the court granted an application brought by a widow that her late husband’s human reproductive material was her sole legal property and that it should be released for her use absolutely to create embryos.

The deceased had not given his written consent but had stored sperm during his lifetime.

The deceased had suffered with severe medical conditions throughout his life, but he and his wife strongly wanted to have a family. They agreed that the wife would use his reproductive material to conceive a child, regardless of whether or not he died.

The deceased was unaware and had not been told that he had to provide written consent to his wife’s use of his reproductive material for the purpose of creating an embryo, as required by the AHRA and its regulations. He died without having given such consent.

The deceased died intestate. The court found that he had rights of use and ownership in his reproductive material sufficient to make it property, and that on his death that property and reproductive material vested in his wife as his spouse and the sole beneficiary of his intestate estate.

The deceased had freely and repeatedly expressed his consent to his wife’s use of his reproductive material following his death, and he expressed his consent after he had the benefit of professional consultations

The court held that to deny the wife the use of his reproductive material intended by the deceased would be unfair and an affront to her dignity.

Accordingly, the court ordered that her late husband’s reproductive material be released to the wife for her use to create embryos.

The Genesis case was distinguished and not followed in L.T. v. D.T. Estate (Re), 2019 BCSC 2130. In that case the court, after hearing lengthy argument, dismissed an application by a widow that human reproductive material from her deceased husband be removed from his body, stored, and used to create embryos for the reproductive use by the widow and for no other or improper purpose.

The matter was initially urgently heard within hours after the deceased’s death in October 2018. The court allowed reproductive material to be taken from the deceased’s body and stored, pending final legal argument.

The court reluctantly came to the conclusion that the AHRA requires an individual to formalize his or her informed consent in writing if he or she wishes to permit the posthumous removal of his or her reproductive material.

The Genesis case was not followed on the basis that the deceased in that case had provided reproductive material during his lifetime to be used after his death, for the creation of an embryo. By contrast, in the L.T. case, the deceased was a young married man with one child who unexpectedly died intestate without providing his written consent or leaving any reproductive material during his lifetime.

Conclusion

“En ventre sa mère” case law has been well settled and the new frontier of litigation concerning children born after death involves the access to and use of reproductive material of both sexes. As reproductive technology becomes more advanced and available, I would expect that access to the use of stored sperm and ova will increasingly be the subject of both family law and estate litigation, as well as estate planning.

Posthumous Births

Overcoming the Presumption of Indefeasible Title

Estate disputes frequently involve issues relating to who is the true beneficial owner of a property due to a myriad of fact patterns, and the legal arguments invariably refer to the presumption of legal and beneficial ownership of indefeasible title.

The first thing any lawyer will do in any dispute as to the legal vs beneficial ownership of a parcel of property is to conduct a land title search.

British Columbia uses the Torrens property regime, and section 23(2) Land title Act creates a statutory presumption that the registered owner on title is presumed to be the legal and beneficial owner of the property.

Fellowship Deaconry Association of BC v Fellowship Deaconry Inc. 2019 BCSC 1476 dealt with a dispute of “ownership” – the plaintiff Church asserting that the defendant held the property in trust for the Church . The defendant relied inter alia on the presumption of S. 23(2) Land Title Act, that the defendant as registered owner was the presumed legal and beneficial owner of the property.

Like any presumption in law, contrary evidence will often overcome the presumption, and the same section 23(2) of the Land Title act provides three options in which the presumption may be rebutted:

1) The operation of a resulting trust, which may be inferred where no value is given for a legal interest;
2) the operation of an agreement between the parties that is contrary to the registered legal title;
3) taking into account the underlying equitable interests between the parties ( for example, a claim such as unjust enrichment)

Most estate disputes involve the law of resulting trust, and while the Deaconry case did review the law of resulting trusts, it ultimately decided the case on the basis of the parties intention based on a review of correspondence and conduct prior to and at the time of the purchase of the property.

In the Deaconry decision , the court ultimately decided it did not have to result to the presumption of resulting trust, as the court found after a review of the evidence and correspondence, that the defendant did not intend to retain a beneficial interest in the church, and that legal title was transferred to the defendant until some agreement about repayment had been reached or fulfilled. The court found that this was the mutual intention of both parties that both the time of the purchase and when title was transferred in 1971.

The court specifically found that the evidence was sufficient to establish the three certainties necessary to create a trust, namely :

1) certainty of intention,
2) certainty of the object of the trust,
3) certainty of subject matter of the trust.

With respect to the law relating to the three certainties necessary to create a trust, the court referred to Norman Estate v . Watchtower Bible and Tract Society of Canada, 2014 BCCA 277 at paragraph 35.

Presumption

S.46 WESA: When Gifts Cannot Take Effect

S.46 WESA applied to the following simple fact pattern that I recently met:

A will left everything to my children in equal shares, share and share alike. One child had predeceased the will-maker, leaving two children.

Applying the provisions of S46 WESA effected that the predeceased child’s share went to his two children, ie the grandchildren of the deceased.

S.46 WESA states:

46.(1) if a gift in a will cannot take effect for any reason, including because a beneficiary dies before the will-maker, the property that is the subject of the gift must, subject to a contrary intention appearing in the will be distributed according to the following priorities:

A) to the alternative beneficiary of the gift, if any, named or described by the will-maker, whether the gift fails for a reason specifically contemplated by the will-maker or for any other reason;

B) if the beneficiary was the brother, sister or a descendant of the will-maker, to their descendants, determined at the date of the will-maker’s death, in accordance with section 42(4) ( meaning of particular words in a will)

C) to the surviving residuary beneficiaries, if any, named in the will, in proportion to their interests.

(2) If a gift cannot take effect because a beneficiary dies before the will-maker, subsection 1 applies whether the beneficiary’s death occurs before or after the will is made.

Terezakis Estate 2018 BCSC 805 discusses section 46 of WESA relating to an interpretation of the residue of a will that dealt with its interpretation with respect to two of five children who had predeceased the will maker.

The two children who had predeceased the will maker also left children.

The residue clause of the will was confusing as to whether it was the intention of the will maker to leave the share of any child who might have predeceased the testator to the children of the predeceased children ie to the grandchildren of the deceased.

The court applied the armchair rule of construction that requires the court to put itself in the position of the testator at the time when the will was made and to construe the language from the vantage point in order to determine the actual or subjective intent of the testator –Re Burke (1960) O.R. 26 (C.A.).

The court noted that the will information sheet reflected that the testator presumed wishes to ensure that her grandchildren receive a share of the residue of her estate in the event that any of her children predeceased her. This was the expressed intention of the testator at the time the will was drafted, and the court applying the rule armchair rule, stated that it was the best evidence upon which the will should be interpreted by the court.

The court referred to both sections 42 and 46 of WESA.

Section 42 WESA states:

42. This section is subject to a contrary intention appearing in a will.

42(4) gifts of property to a class of persons that:

a) is described as a will makers issue or descendants, or by a similar word and
b) b) encompasses more than one generation of beneficiaries, must be distributed as if it were part of an intestate estate to be distributed to descendants.

The court was also mindful of the presumption that a testator does not intend to create an intestacy- Milwarde-Yates v Sipila 2009 BCSC 277 at para. 49.

S.46 WESA states:

1) if gifts in a will cannot take effect for any reason, including, because of beneficiary dies before the will maker, the property that is subject of the gifts must, subject to a contrary intention appearing in the will, be distributed to the following priorities:

a) to the alternative beneficiary of the gifts, if any, named are described by the will maker, whether the gifts fail for a reason specifically contemplated by the will maker, or for any other reason;

b) if the beneficiary was the brother, sister, or a descendent of the will maker, to their descendants, determined that the date of the will maker’s death, in accordance with section 42(4) WESA (that refers to the particular words in a will);

S 46(2) states:

2) if gifts cannot take effect because of beneficiary dies before the will maker, subsection(1) applies whether the beneficiary’s death occurs before or after the will is made.

The court accordingly ordered that the distribution of the estate be made equally among her children and grandchildren, being the grandchildren of the predeceased children.

gifts WESA