When Can a Will Draftman’s Notes Be Admissible to Interpret a Will Meaning?

Re Hoedl Estate 2012 ONSC 6857 involves the issue of whether the drafting solicitors notes are admissible at a hearing to interpret a will meaning.

The executor of the deceased estate was also the solicitor who drafted the will.

The executor initially advised of one proposed distribution of the residue, and then subsequently advised of the second proposal after checking his notes made at the time of drafting the will.

The executor brought a court application for interpretation of the will in order to resolve the confusion created by the two conflicting proposed distributions of the residue.

One of the residual beneficiaries brought a motion for an order that the lawyer’s notes made at the time of the drafting of the will should not be admitted at the hearing.

That motion was dismissed and the notes were admissible at the hearing.

The court found that the wills meaning was clear and that his words were supported by the contemporaneous notes. The notes would not have been admissible to contradict clear words of the will.

However here if the will was ambiguous and could be read in two ways, and the notes would be admissible as extrinsic evidence to clarify the testator’s intention.

12 In Robinson Estate v. Robinson, 2011 ONCA 493(Ont. C.A.) (CanLII), the court reaffirmed the general principal that extrinsic evidence of a testator’s intention is not admissible in the face of an unambiguous will. However, Juriansz, J.A., speaking for the court, said the following, at para. 24:

Of course, it is always possible that the testator’s expression of her testamentary intentions may be imperfect. When a will takes effect and is being interpreted, the testator is no longer available to clarify her intentions. Extrinsic evidence is admissible to aid the construction of the will. The trend in Canadian jurisprudence is that extrinsic evidence of the testator’s circumstances and those surrounding the making of the will may be considered, even if the language of the will appears clear and unambiguous on first reading. Indeed, it may be that the existence of an ambiguity is only apparent in the light of the surrounding circumstances.

Executor Compensation Is Taxable Unless Gifted In the Will

disinherited.com has seen innumerable estate disputes concerning the amount of executor compensation and trustee is entitled.

Under the Trustee Act in British Columbia, the maximum is 5% and it would appear that most executors feel entitled to claim this amount.

Executor compensation can be particularly irksome to the other siblings and is often viewed as one child as executor, lording the authority over the others and then being compensated for it.

Considering that executor compensation is normally taxable, and this is often not known to the executor, it can often be helpful to resolve this disputes by considering the income tax implications for personal income tax to the executor that arises.

The payment of executor compensation can be split over two or more calendar years which can affect the personal taxation rate as of result of perhaps lower marginal rates.

Nevertheless the income is taxable unless proper avoidance techniques are employed.

The use of a specific bequest in the will by the testator to the executor, in lieu of executors fees, can often be successfully utilized in avoiding personal tax for compensation.

No reference can be made in the will that the gift is in lieu of executor compensation, but instead the amount set out in the will could instead perhaps equate to the approximate amount that they might be paid in compensation.

There is always the risk that the executor might seek double dipping, but there is a presumption in law to overcome that the specific bequest was given instead of executor compensation.

Another way of avoiding the tax implications, particularly in negotiations or amongst functional families, is to not claim the compensation but instead have the beneficiaries gift an appropriate amount to the executor in recognition of the labor and time incurred.

Letters of Administration Revoked For Failing To Satisfy Test

Letters of Administration Revoked For Failing To Satisfy Test of Co

Letters of Administration Revoked For Failure to Prove Common Law Spouse Marriage Like Relationship

Souraya v Kinch 2012 BCSC 1252 involves a case where the grant of letters of administration revoked on the basis that the deceased’s alleged common-law spouse,failed to  prove that she met the  definition of common-law spouse as per  section 1 of the Estate Administration Act, which defines a common-law spouse as either:

1) a person who is united to another person by a marriage that, although not a legal marriage, is valid by common-law, or

2) a person who has lived and cohabited with another person in a marriage like relationship, including a marriage like relationship between persons of the same gender, for a period of at least two years immediately before the other person’s death.

The deceased was gunned down in his motor vehicle at the age of 36, apparently  a victim of gang violence.

He died without leaving a will or children.

The defendant Kinch contended at the time of his death that she was his common-law spouse and on that basis, she claims sole entitlement to his estate and the right to administer the estate.

Kinch had earlier applied for and was granted letters of administration, but the sister of the deceased brings this action to set aside the order granting letters of administration to Kinch.

The court held that the grant should be set aside on the basis that Kinch was not, and had failed to prove that she was a common-law spouse of the deceased as per the after said definition.

The court found that there were many factors which pointed to a lack of permanent reason long-term marriage like commitment to each other.

Some of the criteria which the court relied upon were:

  • that the deceased maintained a separate residence from Kinch and intended to do so indefinitely,
  • there was a lack of significant financial interrelationships,
  • and there was a relationship characterized by conflict and breakups.

THE  LAW

The decision gives a very good review of recent law relating to common-law relationships.

The following extract is important:

[11]    In Austin v. Goerz, 2007 BCCA 586, the Court of Appeal held that neither capacity to legally marry nor financial dependence upon the deceased are required in order to come within the definition. The Court applied the decision of the Supreme Court of Canada in M. v. H. [1999] 2 S.C.R. 3, in which the Court considered the requirements of a “conjugal” relationship, for purposes of the statute under consideration in that case. In Austin, at para. 57, the Court quoted from M. v. H. as follows:

[57] Apposite is the more recent decision of the Supreme Court of Canada in M. v. H., [1999] 2 S.C.R. 3, which concerned that portion of the definition of “spouse” in the Family Law Act, R.S.0.1990, c. F.3, conferring certain rights on either a man or woman who are not married to each other but who live together in a “conjugal relationship.” In discussing the requirements of conjugal (i.e., marriage-like) relationships, Cory J. indicated that while financial dependence is a factor it is but one of many to be considered:

59 Molodowich v. Penttinen (1980), 17 R.F.L (2d) 376 (Ont. Dist. Ct.), sets out the generally accepted characteristics of a conjugal relationship. They include shared shelter, sexual and personal behaviour, services, social activities,

economic supportand children, as well as the societal perception of the couple. However, it was recognized that these elements may be present in varying degrees and not all are necessary for the relationship to be found to be coniuoal. While it is true that there may not be any consensus as to the societal perception of same-sex couples, there is agreement that same-sex couples share many other “conjugal” characteristics. In order to come within the definition, neither opposite-sex couples nor same-sex couples are required to fit precisely the traditional marital model to demonstrate that the relationship is “conjugal”.

[Emphasis in original]

[12]    In Austin the Court of Appeal again held (as in Takacs) that how the parties arranged their financial affairs is but one factor to be considered. The Court stated that the presence or absence of any particular factor is not determinative of whether a relationship is marriage-like, observing that, equally, there is no checklist of characteristics that will invariably be found in all marriages. The Court concluded that the chambers judge (at para. 62):

[62] …properly took a holistic approach in finding that Ms. Goerz and Mr. Austin “were in a committed, marriage-like relationship for all purposes.”

[13]    The correct approach, therefore, is “holistic”, meaning that all appropriate factors should be considered, without any particular factor being considered determinative.

[14]    As the authorities set out, many objective indicators and factors may be considered. Several such factors are referred to in Gostlin v. Kergin (1986), 3 B.C.L.R. (2d) 264, (CA), where Justice Lambert stated (at 268):

Did the couple refer to themselves, when talking to their friends, as husband and wife, or as spouses, or in some equivalent way that recognized a long-term commitment? Did they share the legal rights to their living accommodation? Did they share their property? Did they share their finances and their bank accounts? Did they share their vacations? In short, did they share their lives? And, perhaps most important of all, did one of them surrender financial independence and become economically dependent on the other, in accordance with a mutual arrangement?

All those questions, and no doubt others, may properly be considered as tending to show whether a couple who have lived together for more than two years have done so with the permanent mutual support commitment that, in the relevant sense of the Family Relations legislation, constitutes living together as husband and wife.

[15]    Takacs, and M. v. H., cited in Austin, supra, refers to the list of generally accepted characteristics of a conjugal relationship as set out in Molodowich v. Penttinen, (1980) 17 R.F.L. (2d) 376 (Ont. Dist. Ct.). The list of factors referred to in Molodowich is as follows (at para. 16):

(1)       Shelter:

  1. Did the parties live under the same roof?
  2. What were the sleeping arrangements?

(c)        Did anyone else occupy or share the available accommodation?

(2)         Sexual and personal behaviour:

  1. Did the parties have sexual relations? If not, why not?
  2. Did they maintain an attitude of fidelity to each other?
  3. What were their feelings toward each other?
  4. Did they communicate on a personal level?
  5. Did they eat their meals together?
    1. What, if anything, did they do to assist each other with problems or during illness?
  6. Did they buy gifts for each other on special occasions?

(3)         Services:

What was the conduct and habit of the parties in relation to:

  1. Preparation of meals,
  2. Washing and mending clothes,
  3. Shopping,
  4. Household maintenance,
  5. Any other domestic services?

(4)        Social:

  1. Did they participate together or separately in neighbourhood and community activities?
  2. What was the relationship and conduct of each of them towards members of their respective families and how did such families behave towards the parties?

(5)        Societal:

What was the attitude and conduct of the community towards each of them and as a couple?

(6)        Support (Economic):

  1. What were the financial arrangements between the  parties regarding the provision of or contribution towards the necessaries of life (food, clothing, shelter, recreation, etc.)?
  2. What were the arrangements concerning the acquisition and ownership of property?
  3. Was there any special financial arrangement between them which both agreed would be determinant of their overall relationship?

(7)        Children:

What was the attitude and conduct of the parties concerning children?

– See more at: http://www.disinherited.com/blog/letters-administration-revoked-failing-satisfy-test-common-law-spouse-deceased#sthash.gfzr1Lj6.dpuf

Beneficiary Who Prepared Will Has Heavy Burden

Beneficiary Who Prepared Will Has Heavy Burden

Beneficiary Who Prepared Will and Substantially Benefits has a very heavy burden of proof

Cooke v Walsh 1965 (52) WWR 449 is a chestnut of a decision by former Chief Justice Wilson that deserves comment  even 37 years later.

The deceased made a will shortly before she died when she was very ill.

The defendant Walsh prepared the will on as he put it the instructions of the deceased. No lawyer or independent advisor was involved..

The judge found that at the time Walsh was not merely an agent of the deceased but instead was a fiduciary in that he managed her apartment, collected or rents, and got her to sign necessary checks, as well as looking after her personal affairs.

After reading extensively reviewing the law the court found that the burden of proof imposed on the defendants to prove that the testatrix knew and approved of the contents of the will of the time of execution, was so grave that it might hardly be removed.

The court cited the following authorities of law relating to its decision:

  • Kerr on Fraud, 7th ed., p. 429, says this:

If a person benefited by a will has himself prepared it, or procured it to be prepared, the law looks on the case with suspicion, and the Court requires clear and satisfactory proof that the testator knew and approved the contents of the instrument, and that it expressed his real intentions. {Baker v. Batt, [1838] 2 Moo PCC 317, at 320,12 ER 1026; Greville v. Tylee, [1851] 7 Moo PCC 320,13 E.R. 904; Re Harmes Estate; Harmes and Custodian of Enemy Property v. Hinkson, [1946] 2 W.W.R. 433,62 T.L.R. 445, affirming [1943] S.C.R. 61). If there be no evidence of instructions previously given, or knowledge of its contents, the party propounding it must prove by evidence of some description or other that the testator knew and approved of the instrument. (Barry v. Butlin, [1838] 2 Moo PCC 480, at 491, 12 ER 1089; Mitchell v. Thomas, [1847] 6 Moo PCC 137,13 E.R. 636; Vellasawmey Servai v. Sivaraman Servai (1929) 57 LR Ind App 96). The onus of proof may be increased by circumstances, such as unbounded confidence in the drawer of the will, extreme debility in the testator, clandestine and other circumstances, which may increase the presumption even so much as to be conclusive against the instrument. (Paske v. Ollat, [1815] 2 Phillim 323, at 324,161 ER 1158; Jones v. Godrich, [1845] 5 Moo PCC 16,13 E.R. 394; Greville v. Tylee; Ashwell v. Lomi, [1850] 2 LR P & D 477; Harmes v. Hinkson.)

Proof of knowledge of the contents of a will may be given in any form. The degree of proof depends on the circumstances of each case. Although in perfect capacity, knowledge of the contents will be inferred; yet where capacity is impaired, and the benefit of the drawer of the will large, the suspicion is strong, and the proof must be most stringent. Where the drawer of an instrument gives himself a benefit under the instrument, it is a case for suspicion, depending more or less upon the circumstances of each individual case, and the proof must be in proportion to the degree of suspicion, which of course will vary. {Paske v. Ollat; Harmes v. Hinkson.) The greater the benefit and the less the capacity the more stringent is the requirement of proof of knowledge of the contents. {Durnell v. Corfield, [1844] 1 Rob Eccl51,at63,163ER961.)

If a testator being of sound mind and capacity has read the will, there is, as a general rule, sufficient evidence to show that he knew and approved of its contents. {Atter v. Atkinson [1869] LR 1 P & D 665, 20 LT 404, 33 JP 440.) So, also, if a will has been read over to a capable testator on the occasion of its execution, or there is evidence to show that its contents have been brought to his notice in any other way, this fact when coupled with his execution thereof will, as a general rule, be sufficient to show that he approved as well as knew the contents thereof. {Guardhouse v. Blackburn, [1866] LR 1 P & D 109, at 116, 35 LJ P & M 116.) But circumstances may exist which may require that something further shall be done in the matter than the mere establishment of the fact of the testator having been a person of sound mind and capacity, and of his having had read over to him that which had been prepared for him, and which he executed as his will. There is no unyielding rule of law (especially when the ingredient of fraud enters into the case) that when it has been proved that a testator, competent in mind, has had a will read over to him, and has thereupon executed it, all further inquiry is shut out {Fulton v. Andrew [1875] LR 7 HL 448, at 469,44 UP 17).

The exercise of undue influence may be a ground for the interposition of the Court to set aside a will. Though a man may have a mind of sufficient soundness and discretion to manage his own affairs in general, still, if such a dominion or influence be obtained over him as to prevent his exercising that discretion in the making of a will, he cannot be considered as having such a disposing mind as will give it effect {Mountain v. Bennett, [1787] 1 Cox Eq Cas 353, at 355, 29 ER 1200).

In cases of weakness of mind, arising from the near approach of death or otherwise, strong evidence may be required that the contents of the will were known to and approved by the testator executing the will at such a time {Mitchell v. Thomas [supra]; Durnell v. Corfield [supra;), and that the execution was his spontaneous act {Tribe v. Tribe ([1849] 1 Rob Eccl 775,163 ER 1210,13 Jur 793).

When it has been proved that a will has been executed with due solemnities by a person of
competent understanding, and apparently a free agent, the burden of proving that it was
executed under undue influence rests on the party who alleges it {Boyse v. Rossborough;
Boyse v. Colclough, [1857] 6 HLC 2, at 49,10 ER 1192), or at least he must show facts
from which the Court would be justified in treating the circumstances attending the bounty
as suspicious.

Further, in order to set aside the will of a person of sound mind, it is not sufficient to show that the circumstances attending its execution are consistent with the hypothesis that it was obtained by undue influence; it must be shown that they are inconsistent with a contrary hypothesis {Boyse v. Rossborough; Boyse v. Colclough [supra], at p. 51).

The burden of proving that it was executed under undue influence is not discharged by showing merely that the beneficiary had the power unduly to overbear the will of the testator; it must be shown that in the particular case the power was exercised and that execution of the will was thereby obtained {Craig v. Lamoureux, [1919] 3 W.W.R. 1101, [1920] AC 349, 89 UPC 22, reversing 49 S.C.R. 305. As to the particulars that may be ordered see Re Shrewsbury [Earl] Estate; McLeod v. Shrewsbury [Earl] [1922] P 112, 91 UP 46).

  • I have taken the unusual step of citing this long passage from a text book because, having looked at the authorities cited, I cannot better epitomize them.
  • I suppose I should, since both were Privy Council decisions on Canadian appeals, pay particular regard to Re Harmes Estate; Harmes and Custodian of Enemy Property v. Hinkson, supra, and Craig v. Lamoureux, supra.
  • Wintle v. Nye, [1959] 1 W.L.R. 284,103 Sol J 220, a decision of the House of Lords, is cited in Hanbury’s Modern Equity, 8th ed., p. 655 and, at p. 656, the learned author says that, as a result of that judgment “no sensible distinction between wills and transactions inter vivos can now be drawn.”
  • I cite this passage from the opinion of the Lord Chancellor, Viscount Simonds, at p. 291:

My Lords, the relevant law is not, I think in doubt. It was, as the Court of Appeal were unanimously of opinion, correctly stated by the learned judge by reference in particular to the judgment of Parke, B. in Barry v. Butlin [supra], at 482. It is not the law that in no circumstances can a solicitor or other person who has prepared a will for a testator take a benefit under it. But that fact creates a suspicion that must be removed by the person propounding the will. In all cases the court must be vigilant and jealous. The degree of suspicion will vary with the circumstances of the case. It may be slight and easily dispelled. It may, on the other hand, be so grave that it can hardly be removed.

  • I do not think this passage quarrels with the previous authorities I have mentioned. But a thing to be kept in mind in regard to Wintle v. Nye is that the House of Lords did not find undue influence, they found that the issue was this (Lord Simonds at p. 292): “What was in issue was whether she [the testatrix] understood and approved the contents of the will she executed.” On the facts they decided the case against the solicitor who had drawn and propounded the will and who was the chief beneficiary.
  • The decision of the Supreme Court of Canada in Adams v. McBeath (1897) 27 S.C.R. 13, affirming 3 B.C.R. 513, citing Boyse v. Rossborough; Boyse v. Colclough, supra, at p. 49,

The Court held that the English rule of Wintle v Nye aforesaid had not been complied with and the very grave onus of proof the defendant  faced, not met.

– See more at: http://www.disinherited.com/blog/beneficiary-who-prepared-will-and-substantially-benefits-has-very-heavy-burden-prove-will-valid#sthash.bQ72ZSSd.dpuf

Unsigned Draft Will Refused Probate

The only thing surprising about this decision from a British Columbia perspective is that it actually proceeded to court.

The solicitor prepared the draft will and advised the deceased in writing that she was to make an appointment to come in and sign it.

The deceased never did execute the draft will, and despite this, her relatives brought application for admission into probate of the unsigned document, purporting it to be her last will and testament.

The application for probate was dismissed.

The court ruled that a draft will could not be admitted to probate as it would fail the proper requirements of execution.

In Saskatchewan there needs to be at least some attempt at execution of a formal will.

It was not clear to the court that the document express the final wishes of the deceased, as the document was specifically noted as being draft subject to revisions.

There was no evidence that the deceased was confused as to the need to sign the will, as the solicitor’s letter was clear and unequivocal as to the requirement for further action on the part of the deceased.

Who Gets What When There is No Will (Intestate)

What happens when there is no will?

My late mother used to tell me even when I was an established estate lawyer that when someone dies without a will, his or her assets go to the government.

No matter how hard I tried, I could never persuade her of the provisions of the Estate Administration Act RSBC that exists to prevent that very occurrence ,unless there is absolutely no next of kin anywhere in the world.

The provisions that are set out in this blog will be dramatically changing as of likely 2013 when revamped legislation is brought into effect.

In the interim, sections 83-91 inclusive of the Estate Administration Act set out a statutory formula as to who gets what when a person dies without a will(intestate):

 

Intestate leaving spouse but no issue ( issue are lineal descendants- children, grandchildren etc.)

83  If an intestate dies leaving a spouse but no issue, the person’s estate goes to the spouse.
Intestate leaving issue

84   If an intestate dies leaving issue, subject to the rights of the spouse, if any, the person’s estate
must be distributed per stirpes among the issue.

Intestate leaving spouse and issue

85(1) In this section, “net value” means the value of an estate wherever located, both in and out of
British Columbia, after payment of the charges on it and the debts, funeral expenses, expenses of
administration and probate fees.

  1. This section applies if an intestate dies leaving a spouse and issue.
  2. If the net value of the person’s estate is not greater than $65 000, the estate goes to the spouse.
  3. If the net value of the person’s estate is greater than $65 000, the spouse is entitled to $65 000, and has a charge on the estate for that sum.
  4. After payment of the sum of $65 000, the residue of the estate goes as follows:

 

  1. if the intestate dies leaving a spouse and one child, 1/2 goes to the spouse;
  2. if the intestate dies leaving a spouse and children, 1/3 goes to the spouse.

(6)If a child has died leaving issue and the issue is alive at the date of the intestate’s death, the
spouse takes the same share of the estate as if the child had been living at the date.

Spousal share if 2 or more persons are entitled as spouse

85.1 For the purposes of section 85, if 2 or more persons are entitled as a spouse they share the spousal share in the estate in the portions determined by the court as the court considers just.

Estate going to parents

86(1) If an intestate dies leaving no spouse or issue, the person’s estate goes to the person’s father
and mother in equal shares if both are living.
(2) If either of the person’s mother or father is dead, the estate goes to the survivor. Estate going to brothers and sisters

87(1) If an intestate dies leaving no spouse, issue, father or mother, the person’s estate goes to the
person’s brothers and sisters in equal shares.

(2) If a brother or sister is dead, the children of the deceased brother or sister take the share their parent would have taken if living, but further representation must not be admitted.

Estate going to nieces and nephews

88If an intestate dies leaving no spouse, issue, father, mother, brother or sister, the person’s estate
goes to the person’s nephews and nieces in equal shares, and representation must not be admitted in
any case.

Estate going to next of kin

89If an intestate dies leaving no spouse, issue, father, mother, brother, sister, nephew or niece, the
person’s estate must be distributed equally among the next of kin of equal degree of consanguinity
to the intestate, and representation must not be admitted in any case.

Kindred and half blood

90(1) For the purpose of this Part, degrees of kindred are to be computed by counting upward from
the intestate to the nearest common ancestor and then downward to the relative.

(2) The kindred of the half blood inherit equally with those of the whole blood in the same degree. Posthumous births

91         Descendants and relatives of the intestate, conceived before the person’s death but born
afterwards, inherit as if they had been born in the lifetime of the intestate and had survived the
intestate.

The Presumption Against Intestacy

presumption against intestacyPresumption Against Intestacy In Wills Interpretation

Re Murray Estate 2007 BCSC 1035 has been previously blogged by disinherited.com and is a good case relating to the rules of construction in interpreting a will.

One of the golden rules of wills interpretation is that the court will not alter or add to the words of the will unless it is perfectly clear that the will does not express the intention of the testator.

That is particular so was drafted by the solicitor.

Another golden rule is the presumption against an intestacy– if the will is capable of two interpretations, the court will prefer the interpretation which disposes of the whole state in preference to that which results in an intestacy.

 

in Prouse v Scheuerman 2001 BCCA 100, restated a famous quote from Re Harrison (1885) 30 Ch.D. 390, :

” There is one rule of construction, which to my mind is a golden rule, that when a testator has executed a will in solemn form you must assume that he did not intend to make it solemn farce – that he did not intend to die intestate when he is gone through the form of making a will. You look, if possible, to read the wills was to lead to a testacy, not an intestacy. This is a golden rule.”

 

Similarly in re Craig (1976) 14 O.R.(2d) 589, affirmed on appeal stated the rule specifically at page 261:

” A court should only tamper with and add to the words of the will, particularly when drafted by a solicitor, where it is perfectly clear that the testator has not accurately, or completely expressed his intention. In other words, a case which is almost beyond argument.

In order to supply words not present in the will, a court must be certain:

a) that there has been an unintentional omission, and

b) as to the testator’s precise intention, but the testator meant to do.