The Medical Profession Is Woefully Unprepared to Assess Mental Capacity

The test for mental capacity to prepare a will is a legal test and not a medical one, although the court will always be interested in the opinion of the medical practitioners, particularly those who were treating the deceased.

Accordingly, family doctors have been occasionally requested to provide opinions on typically an elderly patient’s ability to handle his or her financial or personal affairs, and to make a will.

I was flabbergasted the first time I cross-examined a family physician as to how much training he had undergone in medical school as to the evaluation of a person’s mental capacity, and he answered none.

Since that was 20 years ago, I have asked many doctors since then, and the answer never appears to be much more than about an hour, maybe.

The fact of there is no standardized tool for medical practitioners to which to refer in the assessment of mental capacity speaks volumes.

Most family doctors are simply too busy to make the proper inquiry and often fall into the trap of asking the caregiver accompanying  the patient as to the problem, treatment etc. rather than taking the time to ask  or explain to the patient him or herself.

Times are changing dramitically, and it is important for the medical profession to literally pull up its socks and learn more about the assessment and proper documentation of the early signs of dementia and to instigate the proper referral and/or treatment at an earlier time.

The population is not only aging, with a greatly increased amount of accumulated wealth, but has also grown multi-fold in its complexities as a result of divorce, remarriage, common-law relationships, same-sex relationships, deliberate single parents, multiracial/religious blending of families, etc., all of which is not only going to lead to an increase in estate litigation, but will also put greatly increased demands on the medical profession to provide opinions on their patients mental capacity.

From a legal perspective, a doctors understanding of mental capacity may very well be different from the legal test, and is important for the lawyer when asking the doctor for an opinion as to a patient’s mental capacity, to properly instruct the doctor as to the legal test.

 

More will be said on this topic in subsequent blogs.

Severance of Joint Tenancy By Power of Attorney Upheld

Severance of Joint Tenancy by aSeverance of Joint Tenancy Power of Attorney Upheld

 

Houston v Houston Estate 2012 BCCA 300 upheld the severance of the joint tenancy through the use of a power of attorney despite the fact that the attorney.

stood to gain financially in a subsequent wills variation action which he only had by reason of the severance of the joint tenancy, thus creating a tenancy in

common of half the house, which formed the only asset in the estate of the deceased.

disinherited.com finds the decision somewhat surprising and opines that this is because of two reasons:

A. The findings of fact by the trial judge which will be set out here after;

B. The fact that the principal of the power of attorney agency agreement was mentally competent and the court found that the attorney was carrying out his estate wishes.

disinherited.com further opines that had the deceased not been competent, that the court would have decided the decision differently and upheld the joint tenancy.

A Central Issue Was the Use of the Power of Attorney a Breach of Fiduciary Duty?

“The trial judge noted the following passage from Egli v. Egli 2004 BCSC 529, in which Madam Justice Garson (then of that court) had stated:

It is the attorney’s duty to use the power only for the benefit of the donor and not for the attorney’s own profit, benefit or advantage {Chapman). The attorney can only use the power for his or her own benefit when it is done with the full knowledge and consent of the donor (Robertson, Mental Disability and the Law in Canada at 183). I am not aware of any authority that detracts from this principle in circumstances where the benefit is conferred on family members.”

 

[54]  ”  There can be no doubt that a fiduciary who engages in ‘self-dealing’ or who receives a secret benefit or profit from a transaction carried out on the donor’s behalf, is accountable to the donor for such profit: see generally Fridman, supra, at 106-110. An obvious exception exists, however, where the donor consents to or authorizes the attorney’s acting as he or she has. This concept is encapsulated in s. 27 of the Property Law Act, which was quoted by the trial judge at para. 70 of her reasons:

Attorney cannot sell to himself or herself

27       A sale, transfer or charge to or in favour of himself or herself by an attorney

named in a power of attorney, of land owned by the principal and purporting to be made under the power of attorney, is not valid unless the power of attorney expressly authorizes it or the principal ratifies it.[Emphasis added.]

[55]    The trial judge found, correctly, that James Houston did not carry out a transfer “to or in favour of himself within the meaning of these provisions. The plaintiff argues, however, that by severing the tenancy, he “created an estate” for his father, since by the time he died, Dr. Houston Sr.’s only asset was the interest in the condominium. Title having been severed, that interest passed to his estate when he died. As the trial judge noted at para. 71 of her reasons, James Houston and his siblings have commenced an action under the Wills Variation Act- which they could not have done except for the severance. Obviously, they might benefit from James’ exercise of the authority granted to him.

[56]    The question of whether James Houston had his father’s authorization or consent to “create an estate” for him was again one of fact. In this case, the question was a delicate one that depended greatly on the credibility of James Houston and his sister, who also participated in the critical conversation with their father. The brother and sister were extensively examined and cross-examined about that conversation, and the trial judge realized its importance in the context of the law applicable to fiduciaries. She found that although the father had not specifically directed his son to use the power of attorney to sever the joint tenancy, he had “clearly instructed Dr. James Houston to use the power of attorney so that his estate would be preserved and his ultimate wishes fulfilled.” (Para. 89.) The trial judge has not been shown to have been wrong in reaching this conclusion or in finding that James acted so that his father’s wishes would be respected. The trial judge also accepted that before he made the appointment for his father to see Mr. Humphries in the fall of 2008, James had told Dr. Houston Sr. that if he, the father, was happy to “let things go the way they [were] going”, the Houston children were “happy with that. We were all well enough off.” But, he said, “Dad wasn’t. He said he [had] always been a man of fairness. He wanted things to go six ways to the family.” To be blunt, the fear of what Ms. Fowler and Mrs. Houston would do after Dr. Houston Sr.’s death put this plan into serious jeopardy.”

Second Medical Examination of Elderly Man Refused

Second Medical Examination of Ederly Man Refused

The BC Court of Appeal dismissed an application that an elderly man undergo a second mental assessment examination

On February 12, 2012 I blogged the Supreme Court  decision in Temoin v Martin 2011 BCSC 1727

The Court of Appeal in reasons for judgment cited at  2012 BCCA 250, dismissed the appeal.

The application concerned the mental incompetency of an 87-year-old wealthy businessman.

The businessman’s daughter commenced an incompetence proceeding stemming from her discontent with changes made by her father to his will and estate plan.

She obtained the medical opinion of one geriatric psychiatrist who diagnosed her father with a mild uncomplicated dementia..

He considered the businessman to be incompetent.

It is a requirement for an application of comitteeship under the Patient’s Property Act that there be two medical examinations and medical opinions before the court

The petitioner brought an application that her father be ordered to attend two medical examinations on certain terms and conditions.

As such, she had not filed the requisite two medical affidavits attesting to her father’s incapacity to manage himself or his affairs.

The Supreme  court dismissed the application but held that it did have the inherent  jurisdiction to make the order sought, but this was not a case where that jurisdiction should be exercised.

The Supreme court noted that it had been well settled law for many years that the court cannot order a medical examination under the Patient’s Property act unless two

medical affidavits, stating that the proposed patient is incapable of managing himself for his affairs, because of mental infirmity, have been produced.

The court does have inherent jurisdiction, however but it can only be exercised where legislation has not “occupied the field”, and where the exercise would not conflict with the governing statute.

The court noted that there had been a legislative gap in that one medical affidavit had been produced, but there was also in addition lay evidence attesting to the proposed patient’s memory and cognitive problems.

The court was of the opinion however that the evidence was lacking and in particular, there  was little evidence that he was incapable of managing his affairs, or that anyone was taking financial advantage of him.

The Court of Appeal commented and agreed, that with regard to the particular case, the judge found an order compelling medical examinations of the elderly man for the purpose of section 3 of the Patient’s Property act, could only be made if there is a prima facie  proof of incompetence, and a compelling need for protection.

The Appeal Court held that the Supreme Court judge did not err in requiring prima face the evidence of incompetence and the compelling need for protection before she would exercise her parens patriae jurisdiction to make the order sought.

Finally the court held, the trial judge did not err in her assessment of the evidence, in particular in finding it was insufficient to establish prima facie  incompetence or that the elderly man was in need of protection.

Joint Tenancy In Matrimonial Home Severed By Owners “Course of Dealing”

Joint Tenancy In Matrimonial Home

The Ontario Court of Appeal decision Hansen v Hansen Estate 2012 CarswellOnt 2051 is an excellent example to illustrate how co-owners of a property, held as joint tenants with a right of survivorship, can through a course of dealing, legally convert the joint tenancy ownership into one of tenancy in common, that has no right of survivorship.

disinherited.com has blogged about this topic previously and this case is  a Court of Appeal decision in Ontario that is pursuing a line of court decisions that disinherited.com previously opined would expand.

The facts in this case are reasonably simple:

A husband and wife after 17 years of marriage separated with the wife moving out of the joint tenancy home.

The wife advised her husband that she wished to negotiate a separation agreement to divide the property quickly and that he could remain in the home while it was being appraised, if he’d bought her out.

The husband made a new will giving the estate to his daughters from a prior marriage and appointing them executors, and change the utilities to his own name.

The parties executed financial statements.

The husband died unexpectedly.

The wife claimed ownership of the home by way of joint tenancy.

The daughters brought an unsuccessful application at the trial level for a declaration that the father’s estate was entitled to an undivided one half interest in the home.

The trial judge reviewed the various methods of severing a joint tenancy, including a course of dealing, and referred to the definition of “course of dealing” in a law dictionary as “clearly recognizable pattern of conduct established or series of transactions or implementation of decisions”

The trial judge noted that there was no exchange of offers, discussion of division of proceeds of divorce, actions against each other, or exchange of correspondence regarding interests or otherwise formal severance of the joint tenancy such as in other cases, and accordingly the judge determined that a severance had not occurred in law.

The daughters appealed and the appeal was allowed by the Ontario Court of Appeal

The Appeal court held that the trial judge correctly enunciated the appropriate principles and correct legal test for severing a joint tenancy, but erred in restricting the application of severance by “course of dealing” to cases which followed patterns of conduct established in prior cases.

The test for severance by course of conduct required determination of whether the parties intended to mutually treat the interests in the property as constituting a tenancy in common, and the party asserting that joint tenancy was severed did not have to establish that co-owners conduct fell into the formulation found to have had effect of severing joint tendencies in other cases.

The court had to look at to the totality of the evidence to determine if the parties intended that the interest be treated mutually as constituting a tenancy in common.

The wife’s assertion of a right of survivorship was entirely inconsistent with the couples mutual intention to divide the property interests and hold interests in common rather than jointly.

disinherited.com is of the view that this is a very significant case in the expanding case law of severance of joint tenancy by a “course of dealing”.

Delusions Towards Next of Kin

Re Fawson Estate 74 ETR (3d) 86 is an interesting Nova Scotia case to do with mental delusions that voided the deceased’s last will on the basis that she lacked testamentary capacity as her delusions towards her siblings , her next of kin, affected her reasoning.

The deceased had no children or spouse and executed her will disinheriting two of her brothers, being her next of kin.

One of the brother sought to have her will proved in solemn form and declared invalid on the basis that the testatrix lacked testamentary capacity when she executed her will.

The evidence was that the testatrix was generally speaking not obviously on or bizarre and in fact functioned in most respects with little impairment and continued to carry out the responsibilities of her job.

However when it came to her mother and her brothers, the testatrix had irrational beliefs which affected her interaction with her brothers which ultimately affected the dispositions in her will.

 

Basically the deceased refused to accept that their mother had dementia despite  the of overwhelming evidence that she did, which resulted  in very disruptive behavior  on the part of the deceased daughter and an intense hatred of her brothers  for opposing her,

 

These irrational beliefs resulted in the testatrix leaving nothing to her brothers in the will.

 

After a lengthy discussion about the burden of proof for testamentary capacity, suspicious circumstances, and delusions themselves, the court came to the conclusion that the deceased did in fact lacked testamentary capacity when it came to her brothers, being her next of kin, and thus the will was declared invalid.

Delusion

 

207        In Theobald on Wills (16th ed., London, Sweet & Maxwell, 2001), the authors set out the test for testamentary capacity in para. 3-02:

 

3-In order to have testamentary capacity a testator must understand:

 

(i) the effect of his wishes being carried out at his death, though it is not necessary that he should view his will with the eye of a lawyer and comprehend its provisions in their legal form;

 

(ii) the extent of the property of which he is disposing; and

 

(iii) the nature of the claims on him. The testator must have “a memory to recall the several persons who may be fitting objects of the testator’s bounty, and an understanding to comprehend their relationship to himself and their claims upon him” so that he can decide whether or not to give each of them any part of his property by his will.

 

208        The authors then consider the effect of delusions on testamentary capacity saying in the following paragraph:

 

3-03A delusion in the mind of a testator deprives him of testamentary capacity if the delusion influences, or is capable of influencing, the provisions of his will. But a delusion does not have this effect if it cannot have had any influence upon him in making his will.

 

A testator suffers from a delusion if he holds a belief on any subject which no rational person could hold, and which cannot be permanently eradicated from his mind by reasoning with him.

 

. . .

 

In practice it may be difficult to distinguish between grave misjudgment and delusion, particularly in relation to a testator’s assessment of the character of a possible beneficiary under his will….

 

A will is not invalid merely because in making it the testator is moved by capricious, frivolous, mean or even bad motives. If he has testamentary capacity he ‘may disinherit …his children, and leave his property to strangers to gratify his spite, or to charities to gratify his pride.

 

209        In Royal Trust Corp. of Canada v. Saunders[2006 CarswellOnt 3478(Ont. S.C.J.)], 2006 CanLII 19424, Blishen, J. said at para. 62:

 

[62] In order to affect testamentary capacity, a delusion must:

 

1. be one of ‘insanity’; and

 

2. be in relation to the testator’s property or expected beneficiaries.

 

and

 

199        In Keddy Estate, Re, 2002 CarswellNS 451(N.S. Prob. Ct.), Hall, J. referred to the burden of proof and suspicious circumstances at para. 25 as follows:

 

25 The profounder of a will has the burden of proving on a balance of probabilities, among other things, that the testator had the mental competence or capacity to make a will. Once due execution of the will is established, the profounder has the benefit of a rebuttal presumption that the testator had the capacity to make a will. Where ‘suspicious circumstances’ are present, however, the presumption may not be relied upon. The question then becomes, what constitutes suspicious circumstances and how do they affect proof of the mental capacity of the testator.

 

200        He then quoted the above passages from Vout v. Hay. That passage was also quoted by Murphy, J. in Willis Estate, Re, 2009 NSSC 231(N.S. S.C.). He said in para. 10:

 

[10]The Supreme Court noted, at para. 25 in Vout, that the suspicious circumstances which will rebut the presumption in favour of a will’s validity may relate to various issues. The Court identified (1) circumstances surrounding the preparation of the will, (2) circumstances tending to call into question the capacity of the testator, or (3) circumstances tending to show that the free will of the testator was overborne by acts of coercion or fraud.

 

It is the second category which is in issue here.

 

201        Murphy, J. continued in para. 16:

 

[16]To resolve the issues raised in this case, the Court must therefore determine:

 

(a) whether suspicious circumstances are present so that the initial presumption of the Second Will’s validity ceases to operate;

 

(b) if suspicious circumstances surrounding the preparation of that will are established, whether the Respondents as proponents of the Second Will have met their civil burden to establish execution;

 

(c) if the Respondents establish that Jams Willis executed the Second Will but circumstances raise a suspicion that the testator’s free will was overborne by coercion, whether the Applicant who attacks the Second Will satisfies the burden to establish undue influence.

Court Ordered Property Sold Due to Unreasonable Sibling

Court Ordered Property Sold Due to Unreasonable Sibling

A court may order co owned property sold and stipulate the terms of the sale, especially when one owner is unreasonable.

I have previously blogged about the case of Mondonese v Delac Estates at both the trial and appeal levels.

The Court had found that the gratuitous transfer by the parties’ deceased mother had resulted from the defendant’s exercise of undue influence upon her.

The Court ordered that the house formed part of the mother’s estate.

The defendant appealed and the appeal was dismissed.

The Court found that the defendant was un- cooperative with the sale of the property and granted the plaintiff the conduct of the sale upon  the following detailed terms,  and reasoning applied by the court in response to each of the parties arguments:

” The plaintiff submits that the property should be listed for sale with a realtor selected by the plaintiff at a price recommended by the realtor and that any sale be subject to court approval unless the parties agree. The plaintiff submits that the net proceeds of sale should be divided into two shares, one share for each party. The plaintiff further submits that from the respondents share she should be paid one-half of the value of the deposits that formed part of the estate, which the respondent has failed to pay over to her. She also asks that she receive her costs of the application and costs in connection with the sale process.

[10]        The defendant submits that the application ought to be determined in accordance with the provisions of the Partition of Property Act, R.S.B.C. 1996, c. 347 [PPA] and refers to s. 6 of that Act, which reads:

6          In a proceeding for partition where, if this Act had not been passed, an order for partition might have been made, and if the party or parties interested, individually or collectively, to the extent of 1/2 or upwards in the property involved request the court to direct a sale of the property and a distribution of the proceeds instead of a division of the property, the court must, unless it sees good reason to the contrary, order a sale of the property and may give directions.

[11]        The defendant submits that there are good reasons why the property should not be sold, namely:

(a)       The history of ownership of the property militates against sale; and

(b)       An order for sale would cause serious hardship to the respondent.

[12]        The defendant’s position, essentially, is that the parties should be declared to be tenants in common, each as to an undivided one-half interest, and that the defendant should continue to be able to occupy the house, I gather without paying any rent, until he dies or chooses to vacate the property.

[13]        The plaintiff submits that this application does not fall under the PPA and, even if it did, there are not good reasons not to sell the property.

[14]        I agree entirely with the plaintiff’s submissions. “””””’

Court Ordered Medical Examinations

Jurisdiction of Court to Order Proposed Patient to Be Medically Examined

Temoin v Temoin 2011 BCSC 1727 concerned the mental incompetency of an 87-year-old wealthy businessman and a court order sought to have him medically examined.

The businessman’s daughter commenced and incompetence proceeding stemming from her discontent with changes made by her father to his will and estate plan.

She obtained the medical opinion of a geriatric psychiatrist who diagnosed her father with a mild uncomplicated dementia.

He considered the businessman to be incompetent.

It is a requirement for an application of committee-ship under the Patient’s Property Act that there be two medical examinations and medical opinions before the court

The petitioner brought an application that her father attended two medical examinations on certain terms and conditions.

As such, she had not filed the requisite two medical affidavits attesting to her father’s incapacity to manage himself or his affairs.

The court dismissed the application but held that it did have the inherent  jurisdiction to make the order sought, but this was not a case where that jurisdiction should be exercised.

The court noted that it had been well settled law for many years that the court cannot order a medical examination under the Patient’s Property act unless two medical affidavits, stating that the proposed patient is incapable of managing himself for his affairs, because of mental infirmity, have been produced.

The court does have inherent jurisdiction, however but it can only be exercised where legislation has not “occupied the field”, and where the exercise would not conflict with the governing statute.

The court noted that there had been a legislative gap in that one medical affidavit had been produced, but there was also in addition lay evidence attesting to the proposed patient’s memory and cognitive problems.

The court was of the opinion however that the evidence was lacking and in particular, there was little evidence that he was incapable of managing his affairs, or that anyone was taking financial advantage of him.

BC Estate Lawyer- Mutual Wills Create Constructive Trust That Severed a Joint Tenancy

Mutual Wills Create Constructive Trust That Severed a Joint Tenancy

Trevor Todd and Jackson Todd have practiced estate litigation for over sixty combined years and have experience in mutual wills.

 

Brewster v Lenzi 2010 BCSC 1488 is an interesting decision involving mutual wills between a husband and wife, that ended with their joint tenancy ownership being severed.

Mutual wills cases are somewhat unusual in that the overwhelming number of the wills made between spouses are commonly referred to as ” mirror wills”.

Mutual wills on the other hand, typically involve a written contract between the parties, separate from their will, that is mutually agreed to govern the ultimate disposition of certain property.

This case is a dispute between a widow and her stepdaughter regarding the daughter’s constructive trust claim against the one half interest in the matrimonial home of the widow and her deceased husband.

The husband and wife were married for the 2nd time each in 1988.

In 1992 will they each contributed an equal sum of money to purchase a condominium, which they registered as joint tenants.

Each partie’s will stated that should the other die 1st, then the survivor would transfer one half of the contents of the house effects, and the deceased’s one half interest in the matrimonial home to their respective beneficiaries, but not the other , for their own use absolutely.

After her father died, the wife refused to transfer his one half interest in the matrimonial home to the daughter of the deceased.

The daughter sought a declaration that the wife owned 1/2 of the condominium property in trust for her, and the court agreed.

The court held that the evidence clearly established a common intention between the parties, and their mutual agreement as to the ultimate disposition of the property, that was meant to be irrevocable and binding upon each of them.

The court concluded that the property was intended to be held in trust by the surviving joint tenant, and to be dealt with only in accordance with the terms of the agreement.

Mutual clauses in their wills governed the disposition of the condominium property.

The intended disposition was clear and established that when they executed their wills in 1992, the husband and wife had the common intention that the one half interest in the condominium owned by the husband, was to be transferred to his daughter upon his death.

The husband imposed a certain an obligation upon the wife to so transfer his interest and she agreed to accept and carry out that obligation.

That agreement was irrevocable and binding.

The case is particularly interesting to disinherited.com in that the condominium was held in joint tenancy between the husband and wife.

If the joint tenancy had not been severed during the husband’s lifetime, then the wife would have received the condominium absolutely upon her husband’s death.

The court reasoned that such the scheme agreed to between the husband and wife denies the right of survivorship, which is an essential ingredient of the joint tenancy.

The joint tenancy was thus severed and the interests of the party converted to a tenancy in common.

The severance occurred in equity, and the court made a declaration of trust in favor of the intended beneficiary.

Demented Senior’s Will Set Aside For Lack of Capacity

Demented Senior's Will Set Aside For Lack of Capacity

Maliwat v. Gagne 2009 BCSC 1447 is perhaps a typical, if there is such thing in estate litigation, case of an advanced demented senior signing a will late in life, that is subsequently overturned for lack of mental capacity.

The testator made one will in 1992 and another in 2006. He named different beneficiaries in each.

Medical, as well as laypersons evidence, showed that the testator had been suffering advanced dementia at the time 2nd will was made.

The Court found the 2nd will was void for lack of testamentary capacity.

The 1992 will was found to be the last valid testamentary document of the deceased.

It is interesting that type of medical evidence that the court requires in order to find that the deceased lacked testamentary capacity.

The testator was assessed by a geriatric psychiatrist 7 weeks after he signed the the the the the 2nd will, and reported.

  • At that time he was unable to state what year it was, when he was born, or when he was married.
  • He did not know his address.
  • He could not remember any of three objects minutes later.
  • He knew nothing of his income, his expenses, bills, his medication, or his illnesses.

The assessment was that he had severe dementia, of the type that progressed slowly and steadily.

Accordingly the court stated that because of his dementia, the testator would not have been able, at the time he signed the 2nd will, to understand the nature and extent of his property, or the effect of the testamentary provisions he was making, nor could he have been capable of forming “an orderly desire as to the disposition of his property.

As an aside, it is also interesting to note that the evidence did not disclose who prepared the 2nd will, or in what circumstances.

This in itself is very suspicious and would rebut the presumption of capacity that each testator has.