Where There Is a Cult, There Is Undue Influence

Undue influence and cults

Undue Influence and Cults

In recent years there have been a rash of news stories about people who have escaped from various cults, sects, communes or other extremely private organizations ,such as Scientology.

Today’s news brings the story of a Marxist commune in South London that is being investigated for slavery and other such related charges. It is the family of Sian Davies who is pursuing the matter since Sian more or less dropped out of society in the mid-1970s when she joined the Marxist commune.

The family understood that she had disappeared, until the police informed them that she had died in 1997 after apparently falling from a window in the groups house in South London.

The family is apparently pursuing the matter on the basis that Ms. Davies was psychologically controlled through political indoctrination.

The Marxist commune is typical of a large number of groups that have sprung up in our society, throughout the world, that are somewhat similar in the way that they originate, their power structure, and their governance.

Some cults exercise extraordinary control over their members lives and use thought reform process, diet and intimidation to influence and control its members..

Another common denominator is that the leader of the cult your commune is often depicted as having supernatural powers that causes members of the group to subject themselves to the leaders everywhere and desire and profit.

Many of us remember the commune in Oregon in the late 1970s, where the “ Bagwan” leader had approximately 66 Rolls Royces that he drove around in, while the members of the cult worked extremely hard for very little, and had sexual relations with their leader when he requested.

The purpose of this article is to state that in legal terms, members of the cult who were under the extreme influence of a leader, to the extent that the leader has mind control over his or her subjects, is classic undue influence.

The Doctrine of Ademption By Conversion

 

Ademption

The doctrine of ademption by conversion — a rule of the law of wills whereby a specific bequest “adeems”, or fails, if at the testator’s death the specified property is not found among his or her assets — either because the testator has parted with it, or because the property has “ceased to conform to the description of it in the will”, or because the property has been wholly or partially destroyed. (J. MacKenzie, ed., Feeney’s Canadian Law of Wills (4th ed., loose-leaf, 2000) at §15.2.)

The doctrine applies as a matter of law, irrespective of the testator’s intentions in the matter, although his or her intentions are clearly relevant to the anterior question of whether the gift in question is a “specific” legacy (and therefore subject to ademption), or a general one (not subject to ademption). The doctrine is also subject to the qualification that even if the gift in question is a specific legacy, it may be saved in some circumstances if the property has changed “in name or form only”, and still forms part of the testator’s property at the date of death.

Being a specific legacy, the gift will be adeemed by conversion if the property has “ceased to exist as part of the testator’s property in his lifetime” (Jarman, at 1065) or has ceased to conform to the description in the will (Feeney, at §15.2).

Whether it was intended for the gift to be adeemed is not relevant: the doctrine applies “irrespective of the testator’s intentions.” (Hurzin v. Neumeyer Estate (1990) 69 D.L.R. (4th) 18 (B.C.C.A.), at 22; Jarman, at 1065

Ademption will not occur where the specific property in question has been changed “in name or form only” so that it “exists as substantially the same thing, although in a different shape.” (Halsbury, supra, vol. 50 at para. 394, citing Oakes v. Oakes (1852) 9 Hare 666 at 672, approved in In re Slater [1907] 1 Ch. 665 at 672 (C.A.).) Whether the change is one in name or form only is a question of fact: In re Jameson [1908] 2 Ch. Ill at 115; Feeney, at §15.27.

Predictably, a body of case-law has developed involving situations in which someone other than the testator has caused the change to occur — e.g., where corporate shares have been forcibly exchanged on an amalgamation or statutory re­organization (see In re Jameson, supra, In re Slater, supra, In re Faris [1911] 1 I.R. 165, In re Leeming [1912] 1 Ch. 828, Re Humphreys (1915) 60 Sol. Jo. 105, In re Kuypers [1925] Ch. 244, and Re Ogilvy (1966) 58 D.L.R. (2d) 385 (Ont. H.C.),

In most of these cases the gift was saved on the basis that the Court found that the change was one in form only.

Legacies – General or Specific

Legacies

Re Wood Estate 2004 BCCA 556, contains a good discussion on the differences between general and specific bequests, aka legacies.

There are generally two classes of legacies — specific and general.

Halsbury’s Laws of England (4th ed. 1998) describes the categories as follows:

A specific legacy must be of some thing or of some interest, legal or equitable, forming part of the testator’s estate; it must be a part as distinguished from the whole of his personal property or from the whole of the general residue of his personal estate; it must be identified by a sufficient description, and separated in favour of the particular legatee from the general mass of the testator’s personal estate. . . .

A general legacy may or may not be part of the testator’s property: it has no reference to the actual state of his property, and is a gift of something which, if the testator leaves sufficient assets, must be raised by his executors out of his general personal estate. Whether or not a particular thing forms part of the testator’s personal estate is a pure question of fact; so long as it is the testator’s at his death it is capable of being specifically bequeathed. Whether or not it has been separated from the general personal estate depends upon the true construction of the will. In the case of real estate a devise, whether of a specific property or by way of residue, is specific. [Vol. 17, paras. 1228-9; emphasis added.]
J.B. Clark and J.G.R. Martyn, the authors of Theobald on Wills (15th ed., 1993), explain the distinction in a similar way:
A general legacy is a legacy, not of any particular thing, but of something which is to be provided out of the testator’s general estate, for instance: “I give £100 to X”; or, “I give £1,000 3 per cent. War Loan to X.” The executors’ obligation is to provide the property given for the legatee and it is irrelevant whether it formed part of the testator’s assets at his death. On the other hand, a specific legacy is a gift of a severed or distinguished part of the testator’s property, thus showing an intention that the property shall pass to the legatee in specie. For instance: “I give my dwellinghouse, Blackacre, to X”; or “I give my silver teaspoons to X.” The severance must be done by the testator, not by some analysis in a court of equity. . . . A specific legacy does not abate until after the general legacies are exhausted, but it is liable to ademption by the testator in his lifetime. The court leans against holding legacies to be specific. [at 243-44; emphasis added.]

Accordingly, a gift of “my grandfather’s gold watch” or of “the shares of XYZ Ltd. now standing in my name” is a specific one, but a gift of “a gold watch” or of “$10,000 worth of shares of XYZ Ltd” is likely to be a general one which must be paid out of the testator’s personal estate if he or she does not own a gold watch or such shares at the date of death. (R. Jennings, ed., Jarman on Wills (8th ed., 1951), at 1037-38.)
[12] Although the third category, demonstrative legacies, was traditionally seen as a sub-category of general legacies (see Jarman, at 1043-44), more modern texts treat these as a kind of hybrid. As Clark and Martyn note, a demonstrative legacy

is by its nature a general legacy, usually pecuniary, directed to be satisfied primarily (but not solely) out of a specified fund or a specified part of the testator’s property. The authors give as an example a gift of “£100 to be raised out of the sale of my Surrey properties.” {Theobald, at 24 4-4 5.) A gift of this kind will not be adeemed even if the proceeds of the Surrey properties cease to exist or to be identifiable prior to the testator’s death. Feeney also notes that such legacies are:

. . . in the nature of a pecuniary and general legacy, except that the will indicates a particular fund out of which it is to be primarily paid. However, if the will shows that the legacy is to be paid out of a particular fund, and that fund only, it is then a specific legacy and is subject to ademption. [§15.8; emphasis added.]
[13] In the case at bar, of course, the gift was of “any cash or any stocks and bonds” held in the RBC account. It is not possible to say that a given amount was to be paid “primarily but not solely” out of the account. Arguably as well, the phrases “any cash” and “any stocks and bonds”, which {counsel agreed) may in this context be equated with “all cash and all stocks and bonds held at the date of my death”, indicate that the gift referred specifically to whatever was being held in the RBC account at the time of the testator’s death — again, not to something to be paid or transferred out of the account. (See Jarman, at 1053.) In my view, then, the gift in clause 3(a) (v) could not be said to be a demonstrative one. Rather, it was a specific legacy — a gift in specie of the actual contents of the account, identifiable not by sum or numbers of shares but only by the broker’s name (RBC) and account number mentioned in the will. Without these “identifiers”, one could not say how much cash or which stocks and bonds Mr. Wood intended to bequeath to his children.
[14] Being a specific legacy, the gift will be adeemed by conversion if the property has “ceased to exist as part of the testator’s property in his lifetime” (Jarman, at 1065) or has ceased to conform to the description in the will (Feeney, at §15.2). Applying this principle to the case at bar, it is clear that in transferring his cash, stocks and bonds from RBC account number 861-16199-1-0 in Vancouver to a different account at Midland in Nanaimo, Mr. Wood caused the subject-matter of the gift to cease to conform to the description of it in the will. Whether he intended for the gift to be adeemed is not relevant: the doctrine applies “irrespective of the testator’s intentions.” (Hurzln v. Neumeyer Estate (1990) 69 D.L.R. (4th) 18 (B.C.C.A.), at 22; Jarman, at 1065.) On this point, I agree with counsel for the appellant that to the extent the Chambers judge below may have considered evidence of the testator’s family situation and other “surrounding circumstances” to decide whether Mr. Wood intended the gift to fail, he was in error.

[15] As noted earlier, however, ademption will not occur where the specific property in question has been changed “in name or form only” so that it “exists as substantially the same thing, although in a different shape.” (Halsbury, supra, vol. 50 at para. 394, citing Oakes v. Oakes (1852) 9 Hare 666 at 672, approved in In re Slater [1907] 1 Ch. 665 at 672 (C.A.).) Whether the change is one in name or form only is a question of fact: In re Jameson [1908] 2 Ch. Ill at 115; Feeney, at §15.27.

BC Court Rules Sperm Freezer at UBC Was Like a “Warehouse Rental”

Sperm donor

 

Lam vs the University of British Columbia 2013BCSC 2094, involved a class-action suit brought by hundreds of sperm donors that had stored their sperm with the defendant University, and their sperm was damaged as a result of the sperm freezer malfunctioning.

At issue was whether the complicated contract signed by each donor prevented that donor from bringing court action against the University due to an exclusion clause of liability.

The court underwent a very detailed analysis and concluded that the sperm was property, and that it was analogous to goods being stored in a warehouse, and the law has been clear for many years that the warehouseman cannot escape liability by inserting such a clause in the contract.

Each sperm donor is seeking damages of between 20 and $100,000 each.

The court examined similar cases from various jurisdictions around the world and stated in part:

35. “The question as to whether sperm is property has been considered by a number of courts. In Yearworth, the Court of Appeal (Civil Division) considered a case with some similarity to the present action. The claimants were cancer patients who, before undergoing chemotherapy, provided sperm samples to the defendant hospital. The sperm were frozen and stored in liquid nitrogen but the samples thawed when the liquid nitrogen levels fell too low. The court rejected the hospital’s argument that the common law does not recognize a substance generated by the body as capable of being owned. It concluded the claimants owned the sperm and stated at para. 45:

In this jurisdiction developments in medical science now require a reanalysis of the common law’s treatment of and approach to the issue of ownership of parts or products of a living human body, whether for present purposes (viz. an action in negligence) or otherwise.

[36] In Yearworth, the court also concluded there was a gratuitous bailment of the sperm by the claimants, and that the hospital was liable to the claimants under the law of bailment.

[37] In Bazley, the Supreme Court of Queensland was asked to determine whether sperm stored by a hospital was property. The sperm was placed in storage when Mr. Bazley was diagnosed with cancer. After his death his wife sought an order preserving the sperm so that she could use it. The hospital took the position under national ethical guidelines that it was required to destroy the sperm as Mr. Bazely had not completed an instruction form transferring the right to use the sperm to his wife. Ms. Bazely argued that the sperm was property which was part of Mr. Bazley’s estate and that it passed to her under his will.

[38] After reviewing the relevant common law authority, including Yearworth and Palmer on Bailment, 3rd ed. (2009), the court concluded at para. 33:

The conclusion, both in law and in common sense, must be that the straws of sperm currently stored with the respondent are property, the ownership of which vested in the deceased while alive and in his personal representatives after his death. The relationship between the respondent and the deceased was one of bailor and bailee for reward because, so long as the fee was paid, and the contact maintained, the respondent agreed to store the straws.

[39] Two Canadian cases have considered whether sperm or frozen embryos are property. In C.C. v. A.W., 2005 ABQB 290, the court considered whether the respondent who had gifted sperm to the claimant for her to use for the conception of children could prevent her use of the embryos. The court found the respondent’s gift was unqualified and concluded at para. 21 that the fertilized embryos were the claimant’s property:

The remaining fertilized embryos remain her property. They are chattels that can be used as she sees fit. Mr. A.W. is not in a position to control or direct their use in any fashion. They shall be returned to Ms. C.C.. Conversely, as they are not Mr. A.W.’s property and he has no legal interest in them, he is not responsible for paying for their storage. That responsibility lies with Ms. C.C. who owns the embryos.

[40] In J.C.M. v. A.N.A., 2012 BCSC 584, Russell J. relied on the decision in C.C. for the proposition that stored sperm is property. She found the reasoning in Yearworthto be persuasive and stated at para. 58:

Further support for this position is found in the Yearworth case. This decision provided a much more detailed basis for a finding of sperm as property. As is acknowledged in that case, typically the common law did not allow for human beings, living or deceased, or their body parts and products to be considered property. This was, no doubt, for good reason. However, I agree with the court of appeal’s finding that medical science has advanced to a point where the common law requires rethinking of this point.

[41] These cases did not consider whether the term “property”, as used in legislation, could include sperm. They were concerned with whether the common law now regards stored sperm or embryos as property. That distinction is of no consequence to the analysis I must make in this case. Courts in a variety of jurisdictions have come to the conclusion that stored sperm is property. I agree with the conclusion arrived at in these cases. The frozen sperm at issue in this case is the property of the class members. The sperm was ejaculated, frozen and stored for the purpose of using it for conception. Applying the current state of the law of property to the definition in the WRAleads to a conclusion that frozen sperm is “goods”.

[42] The next step in the analysis is to ask if the purpose of the provisions in the WRA justifies the application of those provisions to the new definition of property. One of the purposes of the WRA was to codify the common law of bailment. Under the common law, a bailee is required to exercise the same care and diligence with respect to the bailed goods as a careful and vigilant person would exercise over his own similar goods in like circumstances. Sections 2(4) and 13 of the WRA effectively accomplish that. There is no reason why these provisions should not be applied to property that can be stored for reward which was not contemplated at the time the legislation was enacted. The purpose of requiring bailees to exercise adequate care and diligence applies equally to all kinds of property that can be stored for reward.

[43] The other step in the Cote analysis is to ask if the legislative provision in question is sufficiently general to permit its application to things unknown at the time of enactment. As I have already noted, the definition of goods is broad and inclusive. In other words, the provision is sufficiently general to apply to things unknown at the time of passage. There is no reason not to apply the provisions of the WRAto goods which fall within the current understanding of “all property other than things in action, money and land.”

[44] A textual analysis also requires consideration of the enactment as a whole. UBC argues that if “goods” includes sperm, an explicit or implicit conflict is created with other provisions in the WRA and the WLA. As I set out below, I conclude it is not necessary to consider provisions of the WLA when interpreting the provisions in the WRA. Moreover, there is no explicit or implicit conflict with other provisions in the WRAif “goods” includes sperm.

[45] The thrust of UBC’s argument is that the conflict arises because it is an offence to sell sperm. Pursuant to s. 7(1) of the Assisted Human Reproduction Act, it is an offence to “purchase or advertise for the purchase of sperm or ova from a donor or person acting on behalf of a donor.” If a warehouser could issue a negotiable receipt or a transferrable nonnegotiable receipt for frozen sperm, UBC argues this would mean that the sperm could be sold or transferred. This would be contrary to the Assisted Human Reproduction Actand public policy. I reject this submission.

[46] The focus by UBC on the ability of a warehouser of sperm to issue a negotiable receipt is misplaced. It is not an issue in this case because the Agreement does not purport to be negotiable. It is a nonnegotiable receipt. More importantly, the possibility of a warehouser issuing a negotiable receipt for the storage of sperm does not create the kind of conflict that requires “goods” to be interpreted not to include sperm. There is no requirement for a warehouser to issue negotiable receipts – the WRA provides for the issuance of nonnegotiable receipts. It also permits the inclusion of terms in a receipt so long as those terms are not contrary to provisions in the WRA: s. 2(4)(a). Further, if a receipt purports to be negotiable but another statute makes it an offence to sell the property in question, this would not create an irreconcilable conflict. It would only mean that the holder of the receipt would have to comply with other statutory provisions.

[47] The fact that a nonnegotiable receipt can be transferred similarly does not create a conflict or an absurdity. Rather, the holder of such a receipt could be subject to other laws or regulations. A warehouser who issues a receipt for a special class of goods would likely be aware of the existence of other statutory provisions, just as the Andrology Lab would be knowledgeable about laws relating to the transfer and use of sperm. It is for this reason that the Agreement contained specific provisions regarding delivery and use of the sperm.

[48] By analogy, the fact that it is an offence to transfer firearms except in accordance with law would not result in the conclusion that firearms are not “goods” or that the WRA does not apply to the storage of firearms. Rather, any sale or transfer of firearms would have to be made in accordance with other legislative provisions including the Criminal Code and the Firearms Act.

[49] The fact that sperm cannot be purchased does not prevent it from falling within the definition of “goods” in the WRA. It simply reflects the fact that sperm, like other classes of property, is subject to control or regulation by other statutory provisions. If sperm is property that can be stored and for which a receipt can be issued, then it falls within the definition of “goods” in the WRA.

[50] In summary, on a grammatical or textual analysis, the frozen sperm specimens covered by the Agreement fall within the definition of goods in the WRA. The definition is clear and unequivocal; “goods” is meant to include “all property” with three exceptions. Those exceptions do not apply to sperm and the inclusion of sperm in the definition is not inconsistent with other provisions in the WRA.

30 Year Commonlaw Spouse Awarded $150,000 More Than His Half of the Assets

Griese v Syvret 2013 BCSC 1601 is a wills very action trial involving a couple that lived in a commonlaw relationship for 30 years before the death of the commonlaw spouse in 2010 at age 84.

Her major asset was the matrimonial home which they both purchased by contributing an equal amount, that was registered as tenants in common at her death. Her surviving spouse obtained his one half interest in the property worth $727,000, however the wife left her entire estate but for a dining room suite, to a child that she had never adopted, but had raised since the age of six years as her own. The child had been abandoned in an orphanage due to a birth defect. At the time of the trial, the young man was earning $60,000 a year and his wife was earning 30,000.

The issue before the court was what if anything more ought the surviving spouse receive from the deceased in recognition of her legal and moral obligations to him.

The court took some guidance from the statutory scheme of distribution as set out in the estate administration act, had the deceased died intestate.

After careful analysis, the legal discussion of the which follows hereafter, the court awarded the husband a lump sum of $150,000.

In Tataryn (at p. 821) McLachlin J. (as she then was), writing for the Court explained that together these societal norms provide a guide to what is “adequate, just and equitable” in the circumstances of the case.

[61] Also in Tataryn the Supreme Court of Canada recognized the importance of protecting testamentary autonomy, where (at pp. 823-4) McLachlin J. stated:

I add this. In many cases, there will be a number of ways of dividing the assets which are adequate, just and equitable. In other words, there will be a wide range of options, any of which might be considered appropriate in the circumstances. Provided that the testator has chosen an option within this range, the will should not be disturbed. Only where the testator has chosen an option which falls below his or her obligations as defined by reference to legal and moral norms, should the court make an order which achieves the justice the testator failed to achieve. In the absence of other evidence a will should be seen as reflecting the means chosen by the testator to meet his legitimate concerns and provide for an ordered administration and distribution of his estate in the best interests of the persons and institutions closest to him. It is the exercise by the testator of his freedom to dispose of his property and is to be interfered with not lightly but only in so far as the statute requires.

[62] The approach in Tataryn was carefully summarized and grounded in principles of family law by Martinson J. in Steernberg v. Steernberg, 2006 BCSC 1672 as follows (unattributed paragraphs refer to Tataryn):

[59] The language of the WVA confers a broad discretion on the Court, which allows judges to craft results that are just in the specific circumstances of the case and which are adequate, just and equitable in light of contemporary standards, values and expectations (at ¶15). The WVA addresses two main interests – the “adequate, just and equitable provision for the spouses and children of testators” and testamentary autonomy; testamentary autonomy must yield to what is “adequate, just and equitable.” (at ¶16-17).

[60] In looking at current societal norms, two sorts of norms are available and both must be addressed (at ¶28); together they provide a guide as to what is adequate, just and equitable in the circumstances. They are legal obligations and moral obligations.

[61] Legal obligations are “the obligations which the law would impose on a person during his or her life were the question of provision for the claimant to arise” (at ¶28). The legal obligations may be found in the Divorce Act, R.S.C. 1985, c. 3 (2d Supp.), family property legislation, and the law of unjust enrichment (at ¶30). When, as in this case, the parties are not separated or divorced at the time of death the law nonetheless imposes uncrystallized legal obligations that a testator owes to his or her spouse (at ¶28).

[62] Second, the Court should consider the testator’s moral obligations to his or her spouse and children, in light of “society’s reasonable expectations of what a judicious person would do in the circumstances, by reference to contemporary community standards” (at ¶28). With respect to the moral obligation to a spouse, the Court concluded that most people would agree that although the law may not require a supporting spouse to make provision for a dependent spouse after death, a strong moral obligation to do so exists if the size of the estate permits. The moral obligation is broader than the legal obligation and is assessed at the date of death.

[63] The moral duty is customized to each specific claimant. The test in determining whether a testator spouse has breached his or her moral duty is whether, as a just husband or wife he or she properly considered the situation of his or her spouse and an appropriate standard of living for that person: Holland v. Holland (1995), 9 E.T.R. (2nd) 119 (B.C.S.C.).

[64] The moral claim of independent adult children is more tenuous than the moral claim of spouses. But if the size of the estate permits, and in the absence of circumstances negating the existence of such an obligation, some provision for adult independent children should be made (at ¶31).

[65] Circumstances that will negate the moral obligation of the testator are “valid and rational” reasons for disinheritance. To constitute “valid and rational” reasons for disinheritance, the reason must be based on true facts and the reason must be logically connected to the act of disinheritance: Bell v. Roy Estate (1993), 75 B.C.L.R. (2d) 213 (B.C.C.A.); Clucas v. Clucas Estate (1999), 25 E.T.R. (2d) 175 (B.C.S.C.); Comeau v. Mawer Estate (1999), 25 E.T.R. (2d) 276 (B.C.S.C.); and Kelly v. Baker (1996), 15 E.T.R. (2d) 219 (B.C.C.A.).

[66] As between moral claims, some may be stronger than others. The Court must weigh the strength of each claim and assign to each its proper priority. In doing so, the Court should take into account the important changes resulting from the death of the testator. There is no longer any need to provide for the person who died and reasonable expectations following upon death may not be the same as in the event of a separation during lifetime. A will may provide a framework for the protection of the beneficiaries and future generations and the carrying out of legitimate social purposes. Any moral duty should be assessed in light of the person who dies’ legitimate concerns which, where the assets of the estate permit, may go beyond providing for the surviving spouse and children: Tataryn at ¶32.

[67] The test of what is “adequate and proper maintenance and support” as referred to in s. 2 of the WVAis an objective test. The fact that the testator was of the view that he or she adequately and properly provided for the disinherited beneficiary is not relevant if an objective analysis indicates that the testator was not acting in accordance with society’s reasonable expectations of what a judicious parent would do in the circumstances by reference to contemporary community standards: Tataryn; Walker v. McDermott, [1930] S.C.R. 44; Price v. Lypchuk Estate (1987), 11 B.C.L.R. (2d) 371 (C.A.); Clucas, above; and Dalziel v. Bradford et al.(1985), 62 B.C.L.R. 215 (B.C.S.C.).

[68] When possible, all claims should be met. However, if an estate is not large enough to accommodate both the testator’s legal and moral duties, then the legal duties should take priority (at ¶38).

[69] In many cases there will be a number of ways of dividing the assets which are adequate, just and equitable. In other words, there will be a wide range of options, any of which might be considered appropriate in the circumstances. Provided that the testator has chosen an option within this range, the will should not be disturbed. Only where the testator has chosen an option which falls below his or her obligations as defined by reference to legal and moral norms, should the Court make an order which achieves the justice the testator failed to achieve. In the absence of other evidence a will should be seen as reflecting the means chosen by the testator to meet his legitimate concerns and provide for an ordered administration and distribution of his estate in the best interests of the persons and institutions closest to him. It is the exercise by the testator of his freedom to dispose of his property and is to be interfered with not lightly but only in so far as the statute requires (at ¶33).

[63] About fifteen years after Tataryn the British Columbia Court of Appeal decided Picketts v. Hall (Estate), 2009 BCCA 329. In Picketts, Mr. Justice Low, writing for the Court, addressed the issue of the legal and moral duty owed by a testator to a common law spouse, and whether different considerations apply to a common law spouse than to a married spouse in an application to vary a will.

[64] The facts in Pickettswere that Mr. Hall and Ms. Picketts had lived together for 21 years as though they were a married couple. On Mr. Hall’s death, Ms. Picketts was 75 years of age. He left two adult sons, and an estate worth $18,000,000.

[65] Under his will, Mr. Hall left Ms. Picketts the condominium they had been living in, and $2,000 per month for her life. The Court of Appeal awarded Ms. Picketts $5,500,000, an amount close to one-third of the value of the estate, which was the amount she would have received under the provisions of the EAA.

[66] Low J.A. dealt with Mr. Hall’s moral obligation to Ms. Picketts and the application of the EAA, as follows:

[54] Although McLachlin J. in Tataryn did not discuss the Estate Administration Act, R.S.B.C. 1996, c. 122, or its applicable predecessor, under the topic of legal obligations, I think that statute bears mentioning at this point. The provisions in the statute as to intestacy succession create a default succession in law if a person should die without a will. Section 85 states that, on an intestacy in which there is a surviving spouse and a surviving child or surviving children, the spouse is entitled to the first $65,000 of the estate and half of the residue if there is one child surviving, and one-third of the estate if there is more than one child surviving.

[55] In the unlikely event that Mr. Hall had died intestate, Ms. Picketts would have received one-third of the entire estate. This is because the definition of “common law spouse” in the Estate Administration Act was amended by the Definition of Spouse Amendment Act, S.B.C. 1999, c. 29, to mean, inter alia, “a person who has lived and cohabited with another person in a marriage-like relationship, including a marriage-like relationship between two persons of the same gender, for a period of at least 2 years immediately before the other person’s death”. This is essentially the same definition as the definition of “spouse” in the Wills Variation Act. The two definitions became law on the same date.

[56] Although the intestacy provisions of the Estate Administration Act do not directly affect the legal considerations under Tataryn, it is significant that the Legislature chose to amend both statutes at the same time. This can be seen as a dovetailing of the two statutes to reflect the social norms of the day and, to repeat the quote from Tataryn at p. 822, to “reflect a clear and unequivocal social expectation, expressed through society’s elected representatives…”

[67] In Rose v. Bloomfield, 2010 BCSC 315, it was argued unsuccessfully before Mr. Justice Cohen (in light of the above comments of Low J.A. with regard to the distribution scheme of EAA) that the provisions of the EAA with regards to intestacy ought not to be taken into consideration when assessing whether a testator’s provision for a spouse is “adequate, just and equitable”. Cohen J. concluded:

[49] It is not known whether the decision in Hecht v. Hecht Estate was cited to Low J.A. Regardless, I do not agree with the defendants’ interpretation of Low J.A.’s reasons. In my opinion, His Lordship clearly adopted the distribution scheme legislated under the EAA as a means by which to assess whether a testator’s provision for a spouse is “adequate, just and equitable”. Accordingly, I am satisfied that in the case at bar it is open for me to take guidance from the scheme of distribution set out in the EAA when determining whether the Will made adequate provision for the plaintiff, and in my consideration of an appropriate discretionary distribution of the deceased’s estate.

[68] In the present case, I take some guidance from the scheme of distribution set out in the EAA. Had Ms. Jacques died intestate, the defendant would not be entitled to a share of her estate under the EAA. He would not qualify as “issue” and by virtue of s. 83 of the EAA, the plaintiff as the deceased’s spouse would receive her entire estate. Pursuant to s. 85 of the EAA, in the event that the defendant had been adopted and the net value of the deceased’s estate exceeded $65,000, the plaintiff as spouse would receive the first $65,000 and the balance would be split in half between the plaintiff and the defendant.

[69] I also note that had the deceased not made the defendant a beneficiary of her estate, he would not be entitled to bring a claim pursuant to the WVA to challenge the Will. This is because the defendant is neither a natural nor an adopted child. An expanded definition of child is not permitted, for example to include foster children:Peri v. McCutcheon,2011 BCCA 401.

[70] Also of note are the comments of Low J.A. in Pickettsregarding competing claims to an estate as between adult independent children and a loyal spouse:

[60] Cases decided by this court since Tataryn are of limited assistance because the present case is unusual on its facts. I will, however, refer to one case.

[61] In Bridger v. Bridger Estate, 2006 BCCA 230, the testator’s estate was valued at about $311,000 and the trial judge varied the will that favoured three daughters from a first marriage over the testator’s second wife of 38 years. In writing for the majority to dismiss the appeal, Mackenzie J. A. said this:

[20] … Tataryn recognizes that there is no clear legal standard to judge moral claims and the test is more nebulous where the surviving spouse is not strictly speaking a dependent spouse and the children are all financially independent adults. While, as McLachlin J. observes in Tataryn, there may be a number of options for dividing assets by a testator which are adequate, just and equitable, I do not think they include a disposition that entirely prefers the moral claims of adult independent children to those of a loyal spouse who provided care for the testator over years of debilitating decline…

[62] It seems to me that it is also not a viable option for the court to approve a disposition that substantially prefers the moral claims of adult independent children to those of a long-term, caring and dedicated spouse.

[Emphasis added in Picketts]

[71] In deciding whether or not the deceased’s Will made adequate provision for the plaintiff, her long-term spouse, I find certain aspects of the evidence to be of particular note, namely:

o Apart from the Aldergrove property and the likelihood that the plaintiff provided some additional financial support to Ms. Jacques after she retired and he continued to work, fundamentally they kept their financial affairs separate;

o In purchasing their only residence together after about seven years of cohabitation, they purchased it as tenants in common as opposed to joint tenants;

o They both contributed approximately equally to the purchase of the Aldergrove property from their separate financial resources;

o Neither Ms. Jacques nor the plaintiff made provision for the other in their wills (with the exception of Ms. Jacques leaving the plaintiff the dining room set and her half interest in the Aldergrove property as an alternate beneficiary, if the bequest to the defendant failed);

o The deceased raised the defendant as her son from within six months of his birth and persevered in doing so after her husband died;

o The deceased had a close relationship with the plaintiff as her common law husband of 30 years as of the time of her death, and he provided considerable care and comfort to her in the last months of her life;

o The deceased also had a very close relationship with the defendant who was essentially her only child in all ways except that he was not adopted by her;

o The plaintiff contributed approximately $80,811 in terms of maintenance and repairs to the Aldergrove property; the deceased contributed an unrecorded amount likely to be less than $10,000;

o As the plaintiff has received payment for his half interest in the Aldergrove property he has already reaped the benefit of half of any such expenditures;

o The plaintiff is not in particular financial need at this time, and given his age is in generally good health and enjoying life; and

o The defendant is not in financial need as he is an adult person of independent means.

[72] In the present case when I analyze the legal and moral obligations of the testatrix to the plaintiff in the context of Tatarynand the jurisprudence that follows, I find that she did not make adequate provision for her common law spouse of 30 years. I assess her “uncrystallized” legal obligation to the plaintiff at the time of her death to have been modest spousal support. I note that his retirement income was approximately twice the amount of hers, so in practical terms, had the parties separated, the plaintiff likely would have been required to pay her a very modest amount of spousal support. Their “family assets” under the Family Relations Act, R.S.B.C. 1996, c. 128 would have been divided much as occurred upon her death.

What Happens to Your Data After You Die?

Reprinted From Forbes Magazine.

When you die, you’ll leave behind a digital presence – dead data, or a graveyard in the cloud.

The only things certain in life are death and data. Data After You Die?

Every year, Facebook cheerfully suggests I reconnect with some friends on their birthdays. I’d certainly like to, but there’s a glaring complication: these particular friends are dead.

The grieving process being one of the most human of them all, it naturally dredges up all kinds of complex, contemplative thoughts. Loss transcends other divisions, real or imagined, because whether we want to think about death or not, it is something that affects us all.

Earlier this year, Cisco published its Visual Networking Index – estimating that by 2015, annual global IP traffic will pass the zettabyte threshold. Much of this represents the activities and movements of real, living people. Short of a global catastrophe, these imprints will remain online long after these people are dead.

Move up http://i.forbesimg.com Move down.

Historically, an executor of a will is entrusted to sort and delegate items of interest. With so many of our possessions and details of our personal lives now finding their home in the digital realm, ownership, moral, and sociological questions are raised: who does your digital life belong to, who should have access to it, and where does society go from here?

No matter how unpalatable, the subject of death is something businesses will have to wake up to and tackle head on, according to William Beresford, co-founder of data specialist Beyond Analysis.

“When you register for Facebook, how inclined are you to fill in a contact email for someone when you die?” he asks.

There are mechanisms in place for removing a dead user’s profile, but in Facebook’s case you will need to provide a birth and death certificate, and prove that you are the lawful representative of the deceased. Hardly a pleasant or high priority task.

“It’s a complex idea, and it’s not the sort of thing you think about when you’re living your digital life,” Beresford says. “There are interesting challenges: how do I filter my personal digital existence? I went online in ’92, hopefully when I die there will be 50 or 60 years worth of digital history. It’s a potential minefield.

“We’re going to have to find a way to consolidate our digital existence, which currently is completely fragmented. There’s going to have to be some way where you can collect that information in one place, or know that’s where you can access it – who does it come down to, and who would you rather have it?”

The dead have historically not had much of a right to privacy. But bridging the gulf between our digital and physical lives could change this, at least according to Gavin Llewellyn, partner at law firm Davenport Lyons.

“Increasingly, we are seeing companies encroaching on people’s rights of privacy,” Llewellyn says. “Google has imposed a contractual term into its Gmail service to enable it to scan emails in order to produce targeted advertising. It is doubtful that many users were aware of this when Google’s T&Cs were altered.

“While the letter of the law may be on Google’s side, privacy rights are a fundamental human right and should not be able to be waived without users being made aware of what is happening to their information,” Llewellyn says. “Greater notice should arguably be given of an intention to invade people’s privacy rights, and it shouldn’t matter whether those people are live or dead.”

Duncan White, co-founder of data exchange platform Handshake, believes the way data is treated in 2013 is illogical and almost criminal.

“Data brokerages take your data, sell it, and make money from it,” White says. “That’s crazy. It’s like saying I’ll take your car, sell it, profit from it – it’s theft, for want of a better word. People are taking assets that are rightfully yours and are making money out of it.”

Data is valuable, but the businesses that control it play a numbers game to retain their own value. For example, companies like Facebook and Twitter count on the sheer scale of the data they generate to appease the markets. “To suddenly take away half of their users would slash market value,” White says. “In essence, if for whatever reason people aren’t active, their data is useless, but they’re aggregating it all and monetizing it apropos.”

White compares the amount of dead data floating around the web to the man-made islands of trash that pollute our oceans.

“There must be vast tracts of unclaimed data just floating around, taking up exabytes and exabytes, that nobody is actually doing anything with,” White says. “Data is very cheap to collect, and the whole move to big data is around volume and collecting data from everywhere… The way big data is going, so much is generated it becomes value-less, and floats off into the sea.”

If data is going to waste now, then what are some possible applications for the future?

Former CTO of British Telecom and independent analyst Peter Cochrane is optimistic about the potential for dead-people’s data to provide us with valuable insights after they have left this world. ”Some are arguing because we don’t write letters anymore, we won’t know as much about people as we did in the past. I think we’ll know even more,” Cochrane says.

“Compare Stephen Hawking and Isaac Newton. Newton wrote lots of interesting letters and people wrote interesting letters to him,” Cochrane says. “Some of those survived and they form the basis of our understanding of him and his life. But if we look at Stephen Hawking, we’re going to have a legacy of all his emails, electronic copies of all the scientific papers he wrote, his Facebook account, and any other social media he had – so in actual fact we’ll have a much wider and deeper understanding of the man and his legacy.”

Cochrane asks me to stop and count how many transmitters I have around me. There are a lot.

“For me it’s over 18,” Cochrane says, going on to list not just his mobile phone, laptop or iPad, but his car, his car keys, Wi-Fi hubs, and the controllers for every electronic device in his home.

“There’s just a huge amount of stuff now that leaves a ‘slime trail’ of digital presence,” Cochrane says. “Wherever we go, we leave a slime trail. We inadvertently log on to Wi-Fi, Bluetooth, 3G, 4G, and this leaves an indelible record of where we’ve gone. What we do is recorded and saved. And so there is a huge amount of data about us.”

All of this data we leave behind – this ‘slime trail’ – brings up many more questions: why are Peter and I talking? Will we ever meet, and if so, where? Why? Who do we both know?

“That’s very interesting commercial information,” he says. And with the emergence of technologies like Google Glass and Microsoft’s Mylifebits, the world is progressing to a point where your entire day can be summed up and searchable in minutes. ”A digital slime trail is being established. We’re all leaving a vast database of who we were, what we did, how we contributed to society, what diseases we suffered – all of those things. And that is going to be mined in the future. No doubt about it.

Cochrane believes sci-fi intrigues such as talking to the dead, using advanced combinations of artificial intelligence and data gathering, could well be possible.

He cites discussions he had a “long time ago”, speaking with leading scientists about capturing their lectures, their work, and how it could be feasible for a virtual presence of the deceased to answer questions, based on what they knew, how they think, and in line with their life experiences. “That seems to me a fairly reasonable and tenable endpoint,” Cochrane says. “All the components for this exist, this is no scientific hypothesis, this is an engineering challenge.”

“I lost both my parents in fairly tragic situations, and my wife in an even worse situation. I often ponder what I’d do if I’d got them actually embedded in a machine – would I choose to talk to them? When you lose somebody, especially a parent or your wife, you tend on occasions to talk to them. They’re still with you. They never get older. Sometimes, you will talk to them. I just wonder where that will go. I can imagine it being incredibly comforting and upsetting at the same time. The technology to do this – the price will tumble, the availability will rocket, and you will be able to do this not just for the ‘special’ people in society, but for everybody, if you so wish. People will have a choice. I’m expecting this in my children’s lifetime.”

Visions of intelligent, post-death communication may be strikingly lofty. But developments in the modern world which we now take for granted would have seemed unimaginable just fifty years ago. In the nearer term, collating data on health could provide benefits to humanity as a whole.

Technologies like IBM Watson can cope with a vastly larger number of variables than people, and potentially make better judgment calls than humans in the case of medical analysis. Companies like 23AndMeare already focusing on genetic analysis, while Google-backed Calico made headlinesby taking on the ageing process itself. Just as organ donation can help further research now, so too will charting your life and, ultimately, your deathA lot of the information about the people who’ve died early will be gathered, and an analysis will be done to figure out if there was a common strand,” Cochrane says. “Why did they die early? What was it?”

“I can just imagine, in my children’s lifetime, there being a huge industry heading in this direction,” Cochrane says.

The unprecedented rise and rise of our digital lives, combined with our increasing reliance on the connected world, pose questions society will have to answer together. As our on- and offline presences converge, it is arguable we’re living in a transitional phase. Finding ourselves at the foot of a steep learning curve, there are debates to be had about just how we want our digital shadows to be used, who they are owned by, and what purposes they can serve, whether we are around to have that input or not.

Taking Instructions and Testamentary Capacity

Testamentary Capacity

Will makers must always conduct an assessment of mental capacity when taking will instructions.

In 1992 I was Plaintiff’s counsel in the decision Mikita v. Lick. The action involved a 10 day trial, in which I succeeded in setting aside a will and transfer, prepared by a notary, whereby an elderly gentleman bequeathed his entire estate to his housekeeper. My client incurred legal fees and/or disbursements approximating $80,000. I then sued the notary for recovery of all of those fees and disbursements. Adrian Chaster, on behalf of your Society did an excellent job in settling the case for $40,000. Were I to bring the action today, I would not have settled for that amount.

The trial Judge made the following comments about the notary in his Reasons for Judgment:

“No notes of this meeting were made by the Notary. He says he advised the deceased of the contents and the meaning of the documents and “he appeared to me” to understand. No background was gone into as to prior wills, size of the estate and those things a lawyer would be bound to look to or which, I would suggest, an ordinary cautious and prudent person would look to when faced with the circumstances here. It is argued that he is not a lawyer and his actions should not be judged by legal standards. That may be so but we are not judging his actions here, we are looking at the deceased’s competence and his evidence, because of the lack of any in-depth enquiry, is not helpful in that area one way or the other. No attempt was made to assess his capacity. We knew the deceased was not well but he did not ‘probe minds’. No wills check list was used. The reasons given was that these things were not done in the case of a “simple will” which he maintains this was. He says that if he has any concerns regarding capacity in such cases he would always turn the person over to a lawyer but the fact remains that he had the documents all drawn up ready for signature before he ever had the deceased into his office. In the witness box he almost apologetically said that he trusted and relied on M. With respect he relied on a weak reed in this instance – she also had done only a most superficial examination. When it was suggested that, in effect, he ‘rubber-stamped’ the provided documents after a most perfunctory inquiry he said little.

I am satisfied that his interview with the deceased was as cursory as was hers and he ignored the obvious and did not question the suspicious. The deceased may have appeared to know what was going on but I am satisfied, and future events proved, that he did not. When the documents were completed the bill was prepared by M and she filled out a cheque for the deceased to sign which he did. That signature alone is enough to give one pause to consider the capacity of the signer.”

Three tings may be obvious to you so far from this introduction, namely:

That legal fees are recoverable by the executor for solicitor negligence in the preparation of a will where it is subsequently found that the testator lacked sufficient capacity ;

That the notary failed to conduct an in-depth enquiry, take notes, follow a will checklist, etc., because this was a case of a “simple will”;

That it was argued that the notary’s action should not be judged on the same basis as that of a lawyer;

I urged each and every one of you to never consider the preparation of any will to be that of a “simple will”. In my view there is no such thing as a “simple will”. Each and every will is potentially fraught with problems and potential liability.

With respect to liability for notaries, I am sure you are all aware of the decisions of Flandro v. Mitha 1993 D.L.R. (4th) 222, and Crowe v. Bollong (unreported) March 19th, 1998 BCSC.

The Flandro case held that a notary owed a Plaintiff a duty of care equal to that owed by a solicitor.

In the Crow v. Bollong case, a notary was successfully sued for professional negligence in drawing up a will which failed to provide for a discretionary trust for a handicapped daughter, that he ought to have known might lose her entitlement to G.A.I.N. by reason of this negligence. The Court specifically found that the notary had no authority to draw a will that included trust provisions.

I draw your attention to Section 18(b) of the Notaries Act which states, inter alia, as follows:

(b) draw and supervise the execution of wills

(i) by which the testator directs the testator’s estate to be distributed immediately on death,

(ii) that provide that if the beneficiaries named in the will predecease the testator, there is a gift over to alternative beneficiaries vesting immediately on the death of the testator, or

(iii) that provide for the assets of the deceased to vest in the beneficiary or beneficiaries as members of a class not later than the date when the beneficiary or beneficiaries or the youngest of the class attains majority;

2. TAKING INSTRUCTIONS

I do not purport to be an expert on the taking of instructions from a testator.

However, I do attach hereto to my paper the Law Society of British Columbia Practice Checklists Manual for Will Procedures and the Testator Interview. You will see that it is substantial in detail and I urge you to follow the gist of the Checklist on each and every meeting with your clients where applicable.

The taking of instructions in order to determine whether a client has sufficient mental capacity to properly give you instructions, is a matter of considerable difficulty and extreme importance. I suspect that the potential liability and the importance of determining mental capacity on the part of many solicitors and notaries, is not clearly appreciated or understood.

In determining mental capacity, what is first and foremost to the lawyer should be the probing of the testator’s mind by asking detailed and insightful questions, such as many of those provided in the aforesaid Checklist.

The following is a review of case law where the Courts have reviewed the conduct of solicitors in preparing wills, as they may relate to the issue of mental capacity, and where the courts have approved or suggested :

(a) It is essential to probe the mind with regard to the testator’s assets, beneficiaries and background. The ability of a testator to recall his assets and his appropriate beneficiaries is a very important test of both capacity and memory;

(b) If you have any doubt at all as to the mental capacity of the testator, then it is important to obtain a medical opinion as to same. I go so far as to say that notaries may not in fact have the statutory authority to prepare a will for a testator where capacity is suspect, by reason of the powers set out in Section 18 of your Act. I submit to you that in all of those circumstances the matter should be referred to a lawyer rather than attempting to handle the matter yourself. When obtaining a medical opinion it is very important to carefully advise the doctor as to what the test for mental capacity in fact is, as many doctors do not properly understand same. If at all possible, the doctor should attend at the execution of the will and be one of the witnesses. Request the doctor to make a detail note to the chart regarding his or her observations of capacity. Try and have the doctor conduct his medical examination as to capacity at or very close to the time that the will instructions are given.

(c) Always take instructions in the absence of potential beneficiaries or executors;

(d) Question the testator as to whether or not he or she has made recent sizeable inter vivos gifts to any person;

(e) Make detailed notes of all of your more important questions and the client’s answers, including a specific comment on the capacity of the client;

(f) Be very aware of potential suspicious circumstances;

(g) Record detailed reasons why any person who would be an appropriate object of the the testator’s bounty is being omitted from the will, and if so, consider the preparation of a detailed memorandum to the will in conjunction with your notes;

(h) If at all possible, previous wills should be reviewed in an attempt to ascertain whether or not there have been substantial changes and why ;

(i) Determine as a whole whether the will is reasonable given the testator’s circumstances? If not, consider why this is so;

(j) Try and keep the wording of the will as simple as possible, particularly when your client is seriously ill, elderly, illiterate or has a language or mental disability; ( ie avoid words such as issue or per stirpes , and instead use words like child)

(k) Keep detailed notes and file contents preserved indefinitely.

In 1996 I had occasion to conduct perhaps the world’s shortest cross-examination of a lawyer who prepared a will. He has 25 years experience, and advertises weekly that he is an experienced estate lawyer. I showed the lawyer the Law Society Checklist which I previously referred to, and asked the lawyer if in fact he did one single item on that entire list. He stated that he did not and I then sat down. The effect was dramatic to the trial judge.

That lawyer failed to even meet the testator, took instructions from the sole beneficiary, and simply gave that beneficiary the will to be signed with a letter (incorrectly) stating how to have the document executed. I am sure that no one here today would ever do such a thing.

3. STANDARD OF CARE FOR SOLICITOR NEGLIGENCE

The Supreme Court of Canada stated in Central and Eastern Trust Company v. Rafuse [1986] 31 D.L.R. (4th) 481 at 523 that :

“A solicitor is required to bring reasonable care, skill and knowledge to his performance of the professional service which he has undertaken”.

The requisite standard of care has been variously referred to as that of the reasonably competent solicitor, the ordinary competent solicitor and the ordinary prudent solicitor.

In Jacobsen Ford-Mercury Sales Ltd. v. Sivertz 1980 W.W.R. 141, it was stated:

” A lawyer is obliged to act as a “prudent solicitor” and must “bring to the exercise of his profession a reasonable amount of knowledge, skill and care in connection with the business of his client”. There is no liability for mere errors in judgment because a solicitor does not undertake not to make mistakes but only not to make any negligent mistakes. The determination is said to be a question of degree, and there is a borderline between negligence and no negligence: see Linden Canadian Tort Law 1977 pp. 108 – 109.”

I again remind you that notaries are under the same standard of care as that of lawyers.

4. WHAT IS TESTAMENTARY CAPACITY ?

Each and every one of has undoubtedly made a somewhat snap decision upon meeting a client for the first time, that we have no reason whatsoever to question that client’s mental capacity. The client appears to be dressed appropriately, and to act appropriately, and to be able to converse extremely well, at least on a superficial level.

In my submission it is a very serious mistake to prepare wills for clients, and make the assumption that your client has sufficient mental capacity to properly instruct you. I in fact urge you to approach the situation from the exact opposite mind set , and almost assume that your clients lack mental capacity until you are satisfied, after probing their minds sufficiently, that they do in fact have sufficient mental capacity.

I strongly recommend to each and every one of you when you are taking will instructions, that you bear in mind that some day you may be asked under oath in open Court just what exactly were your observations about the deceased’s capacity at the time you took your will instructions.

Banks v. Goodfellow 1870 LR 5 QB 549, is the legal chestnut relating to the test for mental capacity. The case finds there must be 4 criteria, namely:

(i) the testator understands that he is making a will and that a will disposes of property upon his death;

(ii) the testator must know the assets he disposes of, that is, he understands the nature and extent of his property;

(iii) the testator understands and appreciates the claims to which he ought to give effect, that is, those who have an appropriate claim upon his bounty;

(iv) the testator must be free of delusions which may affect his decision.

In Leger v. Poirier 1944 3 D.L.R. 1 (SCC) Justice Rand, speaking for the Supreme Court of Canada, said that a “disposing mind and memory” is:

“capable to comprehend, of its own initiative and volition, the essential elements of will making, property, objects, just claims to consideration, revocation of existing disposition, and the like”.

The time honoured phrase is that a person must be of “sound mind, memory and understanding” in order to be able to make a will. When a will is contested on the grounds of mental incapacity, the executors must prove that the testator had a sound disposing mind. This means that they must show that the testator was not only able to understand what he was doing, but that he was able to comprehend and recollect what property he had and remember the persons that he might be expected to benefit. He must understand as well, the extent to what he is giving to each beneficiary and the nature of the claims of others to whom he is excluding.

The relevant time for having capacity to make a will is when instructions are given. If a person has capacity then, he may make a good will later, so long as he knows he is executing a will for which he has previously given instructions and is physically capable of showing his assent thereto. Parker v. Fellgate (1883) 8 P.D. 171

However the Courts will not require such a high degree of proof that it would make it almost impossible to prove testamentary capacity. In Laramee v. Ferron 1909 43 SCR 391, at page 409, it was stated:

“We must be careful not to substitute suspicion for proof. We must not by an extensive doing so render it impossible for old people to make wills of their little worldly goods. The eye may grow dim, the ear may lose its acute sense, and even the tongue may falter at names and objects it attempts to described, yet the testamentary capacity be ample.

To deprive lightly the aged thus afflicted of the right to make a will, would often be to rob them of their last protection against cruelty or wrong on the part of those surrounding them and of their only means of attracting towards them such help, comforts and tenderness as old age needs.”

It should also be stressed that even “somewhat crazy” people may also still have testamentary capacity. The Supreme Court of Canada in O’Neil v. Royal Trust and McClure 1946 SCR 622, stated that the testatrix had sufficient capacity, even though she heard voices from beyond the grave, and smelled gas in her room and thought that her food was being poisoned, on the basis that her hallucinations did not influence her motives in making the will.

5. WHAT IS THE SOLICITOR’S DUTY TO DETERMINE CAPACITY

There is a clear duty imposed on lawyers and notaries when taking instructions, to be satisfied that the testator has testamentary capacity, that the testator has knowledge of and approves the provisions contained in the will, and that there is no apparent coercion or undue influence being exercised on the testator. This duty is enhanced where the testator is frail, elderly or the instructions are taken from someone other than the testator.

There are innumerable decisions where the Courts have been very critical of certain lawyers in the preparation of a will and the taking of instructions.

One of the better known decisions is Re: Worrell 1971 OR 184, where the Judge stated at pages 188 and 189:

“I consider it necessary in this action to comment on the conduct of the solicitor who drew the Will that is at issue. The solicitor impressed me as an honest, conscientious person, and yet on his own evidence he acted as set out hereunder:

(a) he prepared a will for a testator for whom he had never acted and whom he never saw and knew the testator concerned was 82 years of age and confined to a home for the aged,

(b) he drew the will without any knowledge of the size of the testator’s estate or the nature of its assets.

(c) he drew the will leaving a substantial portion of the estate to the person who consulted him,

(d) he drew the will with changes from the original letter of instructions signed by the testator without any consultation with the testator,

(e) he handed the will to the beneficiary who had consulted him, to take out and have executed,

(g) he kept no docket entries or other records dealing with the matters in issue.

It seems incredible that a competent solicitor, the head of a respected law firm, would act in this manner. It seems even more incredible that he gave no indication in the witness-box which would indicate that he realized he had acted improperly.”

I also refer you to the decision of Johnson v. Pelkey 17 E.T.R. (2d) 242, as a case that might be cited as being a decision for ” what a lawyer should not do”. Mr. Johnson was the lawyer who took instructions, and applied to court to prove the will in solemn form. The following quote is one a few paragraphs made by the Judge in criticizing Mr. Johnson’s conduct, namely:

” Mr. Johnson believes Mr. Pelkey was not wearing glasses when he came to execute the will on October 23, 1992. He did not ask Mr. Pelkey about his health or who his doctor was. He did not ask about medications. He asked no questions specifically intended to determine mental capacity, memory or even orientation to time and place. He asked no questions to determine if Mr. Pelkey had testamentary capacity. He testified that he assumed Mr. Pelkey knew what his assets were. He did not ask Mr. Pelkey if any of his children had died, or if any of them were under a disability. He assumed that Mr. Pelkey’s beneficiaries continued to be the children listed in the Affidavit of Administrator sworn by Mr. Pelkey after Nellie Pelkey’s death, although that list did not include Bernard Pelkey’s name. He did not ask about the financial situation of any of the beneficiaries. He asked no questions about Mr. Pelkey’s income. He didn’t ask if Mr. Pelkey wanted any of the gifts in the will to go to the grandchildren if any of Mr. Pelkey’s children predeceased him. He referred to the various parcels of land by their legal descriptions but he didn’t ask Mr. Pelkey if he understood which parcel of land was which. He assumed that Mr. Pelkey knew. He didn’t ask Mr. Pelkey about the value of his assets. He didn’t ask him how much money was in his bank account, he assumed it was around $100,000. He does not recall explaining what an executor was and he did not discuss executor’s fees.

Lastly, in Danchuk v. Calderwood Mr. Justice Harvey criticized the solicitor who took instructions of the will, in many paragraphs, one of which is as follows:

“In this perspective, I understand the law to be that a solicitor does not discharge her duty in the particular circumstances here by simply taking down and giving expression to the words of the client with the inquiry being limited to asking the testator if he understands the words. Further, I understand it to be an error to suppose because a person says he understands a question put to him and gives a rational answer he is of sound mind and capable of making a will. Again, in this perspective, there must be consideration of all the circumstances and, particularly, his state of memory.”

6. SUSPICIOUS CIRCUMSTANCES

In addition to testamentary capacity, the propounder of a will must establish “that the testator knew and approved of the contents thereof.” With regard to this requirement, the Supreme Court of Canada in Lidstone, supra, noted at p. 456-7:

When it has been established that a will has been duly executed by a testator having testamentary capacity, and also established that it was read by, or read over to, the testator before execution, there arises ordinarily, in the absence of suspicious circumstances, a strong presumption that he knew and approved of its contents, but there is no inflexible rule on the subject. If, however, there are circumstances which arouse the suspicions of the Court — as, for example, if the will was prepared by a person who takes a benefit under it – the party propounding the will must remove the suspicion by proving that the testator knew and approved of the contents of the document, and it is only when this has been done that the onus of proving fraud or undue influence is thrown on the opponents of the will.

(my emphasis)

Mr. Justice Lambert referred to that passage and explained the meaning of the term “suspicious circumstances” in Clark v. Nash (1989), 61 D.L.R. (4th) 409 at 425 (B.C.C.A.):

It is important to recognize that the “suspicious circumstances” referred to in that passage, and in other authorities, are not circumstances that create a general miasma of suspicion that something unsavory may have occurred, but rather circumstances which create a specific and focused suspicion that the testator may not have known and approved of the contents of the will.

The doctrine of suspicious circumstances may arise in circumstances in which the background concerning the making of the will gives rise or should give rise to some suspicion. The doctrine is intended to ensure that there is no doubt that the making of the will was the free and voluntary act of the testator. In dealing with the will, the Supreme Court of Canada in Vout v. Hay 1995 125 D.L.R. (4th) stated that when dealing with the doctrine of suspicious circumstances and the onus of proof, the party alleging undue influence must prove it, and the question becomes which is more persuasive: the evidence calling into question the validity of the will (the suspicious circumstances) or the evidence supporting it.

It is crucial that a will practitioner look for and identify factors which might appear to be suspicious and to ensure that there is ample evidence to override those circumstances as having had an effect on the testator, prior to the execution of the will. Again there should be a detailed record made of the practitioner’s observations, and the notes preserved.

A short list of the innumerable circumstances in which might be suspicious is as follows:

  • where a gift is made to a person with whom the testator had a close relationship but which was not known or recognized by the testator’s family;
  • where a gift is made to a person who is in a position to influence the testator, such as a care-giver, or the worst example, the party preparing the will;
  • where an apparently unwarranted, undeserving, or unpopular gift is made to a beneficiary who, in the minds of the those left behind, should not receive the gift;
  • where a gift is made to a beneficiary to whom the testator has had no close relationship, such as a charity;
  • where the division of assets among the children of the testator is substantially unequal, or a certain child or children are harshly treated;
  • where the will substantially deviates from previous wills;
  • where a gift is made to a person standing in a fiduciary relationship;
  • where the beneficiary accompanies the testator on each trip to your office during the process to complete the will;
  • where you receive the testator’s instructions from someone other than the testator;
  • Where there has been a recent serious illness or hospitalization;
  • where there is any question at all about testamentary capacity;
  • where there are indications of substantial medications that are potentially mind altering, being used;
  • where there is a hasty or unwise marriage or common-law relationship;
  • where there is evidence of depression;
  • where there is a language/cultural disability or illiteracy;

if you have been asked to prepare a will for someone by which you are to inherit, then you should ensure that the testator receives independent legal advice, and preferably take no part whatsoever in the preparation of the will.

In circumstances where the testator has a will and substantial changes are being made, it would be prudent to enquire of the testator as to the provisions of the previous will and the reasons for the changes.

Similarly if a child or children are being disinherited, you should consider preparing a detailed memorandum pursuant to the provisions of the Wills Variation Act, and enclosing a copy of that signed memorandum with the original will. You should try and insure the accuracy of the information, so that the testator is not subsequently viewed by the court as being vindictive, as opposed to objective.

INDEPENDENT MEDICAL ADVICE

As I previously stated, I am of the view that notaries should not attempt to undertake the preparation of wills where they have any concerns whatsoever about the testator’s capacity, and instead should refer the matter to a lawyer. Having said that, if you wish to proceed, and you have any concerns about the testator’s capacity or the circumstances are such that you believe that others may challenge capacity at the time the will is attempted to be probated, then you should refer the matter to a qualified doctor for the purposes of obtaining a medical certificate as to whether or not the client has sufficient mental capacity to prepare a will. That medical advice should be as current as possible to the actual time that the will instructions are given.

It should also be pointed out that many doctors do not actually understand what the true legal test for mental capacity is, and thus you should in your request of the doctor, set forth the 4 criteria as previously stated in Banks v. Goodfellow.

Medical evidence is not required to prove capacity, nor is it necessarily conclusive when it is given. Generally speaking, a testator is presumed to have sufficient mental capacity to execute a will, unless there are suspicious circumstances present, which then reverses the onus of proof on those who propound the will.

There have been a number of Court cases where the evidence given by eye witnesses who had an opportunity to observe the client and who knew the client, have been accepted over the expert medical testimony to the contrary.

In the recent decision of Rossander v. Rossander, Mr. Rossander attempted to argue that Mrs. Rossander lacked sufficient mental capacity to execute a will and divorce settlement agreement made between themselves. The medical evidence of Dr. Sloan, was that she was absolutely unable independently to manage her finances at the crucial time, and was absolutely unable to understand in any detail the significance of the legal document or power of attorney or any matter to do with transfer of property, and was further probably unable to form the consistent intention required for testamentary capacity, etc.

Nevertheless, the Court accepted the evidence of the handling lawyer, together with other lay witnesses, over the expert medical testimony.

I personally find the decision troubling, but it is not the only decision where lay evidence has taken precedence over expert medical testimony.

LIABILITY OF A SOLICITOR

There are essentially 2 areas of liability which I wish to focus on in this part of my paper, namely:

the liability for legal fees and other consequential damages arising out of the negligence:

In the Supreme Court of Canada Goodman Estate v. Geffen 42 E.T.R. 97, the Court awarded the appellant its full reimbursement for their actual and reasonable costs, including legal fees incurred in defending the respondent’s law suit. The Court stated that it has long been held that trustees are entitled to be indemnified for all costs, including legal costs, which they have reasonably incurred. Reasonable expenses include the cost of an action, reasonably defended.

It is the writer’s experience that the cost of an estate litigation trial can be very expensive, frequently taking 2 weeks or more, and often involving many experts such as doctors. The cost for legal fees alone can be a substantial claim for damages, if there has been solicitor’s negligence in causal link to the damages. Pursuant to the aforesaid decision of Geffen, and other decisions, the executor would be able to sue the negligent lawyer or notary, for full reimbursement of actual and reasonable costs including legal fees.

the liability owed to “disappointed beneficiaries”.

In 1978, Justice Atkins, in Wittingham v. Crease and Company 3 E.T.R. 97, found the lawyer negligent in having a spouse of a beneficiary witness the will. This in turn caused that bequest to fail, and the solicitor was liable in damages for negligence to the “disappointed beneficiary”, in an amount being the difference between what the beneficiary received on an intestacy and what the beneficiary would have received after a successful application under the Wills Variation Act.

The following year, our Court of Appeal followed Wittingham (supra), and in Tracy v. Atkins 16 B.C.L.R. 223, found that despite the fact that the Defendant’s solicitors did not represent the Plaintiff, a lawyer could be liable to an opposing party if he or she placed themselves in a “sufficient relationship of proximity”, that he or she incurred a duty of care towards the Plaintiffs.

Thus, the B.C. Courts in the late 70’s began to allow recovery on the basis of the principle. The principle of that case is that if a person seeks information from a person possessing a special skill and trust, that person to exercise due care and if that person knew or ought to have known that reliance was being placed on his or her skill and judgment, he or she owes a duty of care to the first person. Further, absent express disclaimer of responsibility, the first person can recover damages for financial loss caused by the negligent misrepresentation, where spoken or written, of the second person.

Again in 1979, the British Court of Appeal in Ross v. Caunters, followed Wittingham and found liability against a lawyer to disappointed beneficiaries, where the lawyers had drafted a will, forwarded the will to the testator for execution, but failed to properly ensure that a beneficiary did not witness the will. A beneficiary in fact did witness the will and was successful in a claim against the lawyer for damages for the loss of the benefits under the will.

Probably the current high watermark of solicitor’s liability to disappointed beneficiaries is the House of Lords decision of White v. Jones (1995) 1 All E.R. 691.

In that case a testator had a law firm prepare a will where he disinherited 2 daughters. He subsequently reconciled with his daughters and wrote a letter on July 17th to his lawyers requesting that they prepare a new will with a specific gift to each of the 2 daughters. The law firm never did prepare the will prior to the testator’s death on September 14th. The 2 daughters brought an action for negligence and recovered their loss from the lawyers.

The majority of the House of Lords held that Hedley Byrne cannot properly give rise to a tortious liability. There is no duty of care other than to the client, and Hedley Byrne ought not to apply in cases of pure economic loss, and there is no “loss in not receiving a gift”. In the result, the House of Lords fashioned a new basis for a remedy based on a concept of “transferred loss”, that is since the deceased cannot take action against the solicitor for breach of the retainer, the right to do so was treated as transferred to the beneficiary.

It would appear that this White v. Jones approach gives rise to the argument that liability to the beneficiary is necessarily limited by the terms of the contract of retainer of the solicitor.

The following excerpt from the decision pretty well sums up this area of law, namely:

“The very purpose of the employment of the solicitor is to carry out the client’s wish to confer a particular testamentary benefit on the intended beneficiary. There is no other purpose. If the solicitor negligently fails to achieve that purpose, justice requires that there should be some remedy available”.

The recent British Columbia decision of Smolinski v. Mitchell, 10 B.C.L.R. (3rd) 366, also involved an action against a lawyer where there was delay in carrying out the client’s instructions to prepare a will.

The testator in fact intended to leave a bequest to the solicitor, and the solicitor therefore advised the testator he would have to get independent legal advice and complete the execution of the will elsewhere. The lawyer drafted the will, delivered it to the testator, and left it to the testator to arrange to get independent legal advice. The testator however died before the will was ever executed, and the residue was distributed on an intestacy.

The Court absolved the lawyer from any liability on the basis that the lawyer here had a duty to ensure that the testator obtained independent legal advice. The delay, and possibly the non-execution of the will occurred because of the Defendant’s advice that the testator obtain independent advice and execute the will before an independent lawyer. In the unusual circumstances, there was no duty of care owed by the Defendant to the Plaintiff to see to the expeditious execution of the will. It could not be said that the Defendant failed to take reasonable care to ensure that the testator met with and received advice from an independent lawyer.

I have heard of a California decision where liability was found against a solicitor who took four days to draft a will for a patient who was very ill and in the hospital. The patient died before the will was executed and the disappointed beneficiaries succeeded against the lawyer. I have no reason to believe that this case would also succeed in British Columbia, although it would depend on the degree of illness of the patient, as to whether four days was a reasonable period of time.

In Hickson v. Wilhelm (September 26, 1997)(Sask. Reg. No. 554), the Plaintiff was an employee of the testator, and the Defendant were lawyers retained by the testator. The testator retained the lawyers to incorporate a farming operation and some of the testator’s assets included farm land were transferred to the corporation, although the testator retained bare legal title to the land. He later drafted a will by a lawyer who was a member of the law firm that incorporated the farm. The testator left the land to the Plaintiff and after his death, the land bequest failed because the corporation owned the land despite the fact that it remained registered in the testator’s name. The land was sold and the proceeds were distributed to the residual beneficiaries of the will.

The Court found that the Defendant solicitor who had prepared the will was negligent in that he did not meet “the requirement for due diligence in this case with the result that the role and involvement of the corporation and the ownership of the farm assets was not identified in the bequest of land to the Plaintiff as expressed in the will were ineffectual and failed”.

The Court found that the facts warranted a conclusion that the testator bore a degree of responsibility for the instructions which he gave the lawyer, and attributed a 25% liability to the testator, and 75% to the lawyers. The liability aspect is under appeal.

I think it is somewhat unlikely that disappointed beneficiaries would bring a claim against a solicitor or a notary with respect to the issue of mental capacity, but it is certainly possible, and I wish you to be aware of the existence of these types of claims. I can foresee circumstances where the wills practitioner may be instructed to prepare a will, then take an inordinate period of time to have same executed, during which time the testator suffers a stroke, head injury, mental illness, etc., which renders the testator mentally incapable of executing the will. However, since the relevant time for mental capacity is the time that instructions are taken, it is probably less likely to occur than in situations where the testator dies in the interim.

7. CONCLUSION

I am mindful of the advice given by Stuart Cameron of P.L.I. Claims, the insurers for lawyers in the Province of British Columbia, to follow the 3 a’s, that is:

  • ask;
  • advise;
  • act.

I am sure that many of the cases and practice notes that I have set out in this paper will be somewhat alarming and even disturbing to many of you with respect to your potential for liability.

However, I stress that if you use a checklist when interviewing your client, both to limit the possibility of missing an important question and to record not only your client’s instructions, but your observations concerning important issues such as capacity and others, then you will go a long ways to limiting any potential liability against yourself. Always be aware that you need to probe your client’s mind in order to really try and get at whether or not your client has sufficient mental capacity to properly give you will instructions. For difficult will instructions situations, consider taking another colleague or even your legal assistant with you at the time you take your instructions. This is particularly important where you are taking instructions at the testator’s home or at a hospital, or nursing home.

Lastly, always confirm and record your instructions and advice.

What Is a Testamentary Document?

Testamentary documentIt is often difficult to determine if a document is testamentary or not when it purportedly takes effect upon death.

Shortly before writing this article, I settled a Wills Variation action on the eve of trial where the deceased had deliberately used an estate planning procedure so as to deliberately disinherit four of her five children from the biggest asset, namely the shares in a company that owned a commercial building. The child that was left the significant share of the deceased estate was realistically unemployable and not very capable. The deceased therefore had wanted to retain as much control as possible of her estate until her demise. Accordingly, the handling solicitor prepared a will, and a year later, just prior to her death, prepared an option to purchase the shares of the company in favor of the incapable son, that became exercisable upon her death and for up to two years thereafter. The assets that remained in her estate were also substantially depleted by the payment of the capital gains taxes due and owing on the deemed disposition of her shares. The four disinherited children argued that the option, because it could only be exercised upon her death, was therefore a testamentary document, and because it had not been duly executed in accordance with the provisions of the Wills Act, was therefore void. Essentially the entire Wills Variation action came down to whether or not the option to purchase was or was not a testamentary document. If it was not testamentary, then the shares passed outside of the estate, and could not be attacked by the claimants.

An inter vivos gift occurs when the donor intends the transfer of the interest to be immediate and irrevocable. The gift is perfected during the lifetime of the donor, and there is said to be a “present passing interest”, even when the donee’s right to actual enjoyment is postponed.

A will is the most common form of a testamentary document. The essential elements of a valid will are:

1)It is intended to have a disposing effect;

2)It is intended not to take effect until after death and to be entirely dependent on death for its operation;

3)It is intended to be revocable;

4) It is executed in accordance with the wills legislation of the relevant jurisdiction.

Many documents in fact have a” testamentary look” because the intended gift may be revocable by the donor and enjoyment of the gift has been postponed until the death of the donor. The fact that a document looks testamentary does not necessary make it so. In many situations the donor is able to enjoy the benefits of the subject matter during his or her life and is still able to avoid the formal requirements of the Wills Act. If the transaction is not testamentary, then the property will not be included as part of the estate, and will not be subject to attack by creditors and Wills Variation claimants.

For example, in Re Walmsley Estate, 2001 SKQB 105, a purported last will was found to not be a testamentary document because the testator’s “will” stated that the executor could divide up the estate as he saw fit. The Court held that the document did not manifest a true testamentary intention , and the Court did not have the power to render a document testamentary in nature when it is otherwise not so.

It is therefore of the utmost importance to the drafting solicitor, when preparing documents that are to carry out a transaction outside of the estate, to ensure that the document is not testamentary, as there is always the likelihood that some potential creditor or claimant will question the validity of the instrument by attempting to show that it is in fact a testamentary document.

Again, the fact that a document describes itself as testamentary and is executed in accordance with the Wills Act, does not necessary make it testamentary. As a general rule, the entire document will be rejected from probate if all of its dispositions are operative before death. There have been situations on the other hand, where a part of a document is found to be testamentary because it has no operation at all until death, and it may be severed and admitted to probate.

Problems typically arise where deeds and similar transfers are prepared, and the grantor retains control over the deed and does not intend that it shall have effect until his or her death. If that is the situation, then the deed is really a will, because it is dependent upon his or her death for its “vigor and effect”, and unless it is executed with the appropriate formalities, it cannot take effect as one.

The problem is illustrated by the case of Carson v. Wilson (1961) O.R. 113, (C.A.).

The deceased Wilson owned certain parcels of land and executed deeds and lodged them with his solicitor with instructions to hold them and not deliver them until after his death. It was always understood that Wilson could demand to documents back at anytime. Wilson managed the properties until his death. The court held that the transactions were ineffective to transfer title as there was no delivery of the documents, and in any event, they were not intended to take effect until his death. The court found that the transfers were testamentary in nature, and since they did not comply with the formalities of the wills act, they failed. It was also found by the court that they could not take effect as inter vivos trusts, because Wilson retained complete control over the properties while he lived, and he did not intend to create an inter vivos trust.

Generally speaking, the law appears to be reasonably well settled that if that the time of its execution, the document is legally effective to pass some immediate interest in the property, no matter how slight, the transaction will not be classified as testamentary. Stated another way, if the document is intended to have, and does have the effect of transferring the property, or of setting up the trust”in praesenti” ( the present), though to be performed after the settlor’s death, it is not testamentary.

Accordingly, in the case that I referred to in the first paragraph of this article, I found a Supreme Court of Canada case to the effect that an option to purchase created an interest as soon as it was executed that could be enforced by the courts. I therefore argued that even though the option could not be exercised until the death of the testator, it’s still created an immediate interest in the property, in favor of the donee, that was not dependent upon the death of the testator for its “vigor and effect”.

2. CASE LAW WHERE THE TRANSACTION IS NOT TESTAMENTARY

A) Wonnacott v Loewen (1990) 37 E. T.R. 244, B.C.C.A.

This is the leading decision in British Columbia on what constitutes a testamentary document.

In Wonnacott, the defendant moved in with the deceased in March 1988 and the two planned to marry when the defendant’s divorce was granted. The deceased wished to give the defendant some financial security, regardless of the outcome of the litigation with her husband, so they consulted a solicitor. Certain documents were prepared and executed, including a transfer of estate in fee simple of the deceased’s residence to the defendant, to be used in the event of the deceased’s death. The terms governing the use of those documents were contained in an “escrow agreement” which gave the defendant an immediate right to live in the residence. It also provided that the deceased could take the transfer back in specified circumstances, in which case he was required to pay the defendant $60,000. The defendant’s divorce was delayed and she was not free to marry before the deceased died in August 1988. She obtained the transfer and had it registered, thereby obtaining title to the residence. The deceased’s executor brought an action to set aside the conveyance on the ground that the agreements were testamentary and invalid because of failure to comply with the Wills Act. The action was dismissed and the executor appealed.

The Court dismissed the appeal and held that whatever the form of a duly executed instrument, if the person making it intends that it not take effect until after his death, and it is dependent on his death for its “vigour and effect”, it is testamentary. However, if the document creates a gift in praesenti, albeit to be performed after the donor’s death, it is not dependent on his death for its “vigour and effect”. The documents here, examined in isolation, appeared to be testamentary, but it was clear that they had life and vigour from the beginning. The documents conferred an interest on the defendant that had real value no matter what happened. They gave her an immediate interest in the property and they were not testamentary.

The court examined the decision of Cock v. Cooke (1866), L.R. 1 P.p. & D. 241 at 243, that held that:

“It is undoubted law that whatever may be the form of a duly executed instrument, if the person executing it intends that it shall not take effect until after his death, and it is dependent upon his death for its vigour and effect, it is testamentary.”

The court then adopted the reasoning of an Alberta Court of Appeal case, Corlet v. Isle of Man Bank Ltd., [1937] 2 W.W.R. 209, 4 I.L.R. 246, [1937] 3 D.L.R. 163 (Alta. C.A.), which states at p.p. 211:

“The fallacy in the argument based upon the “oft quoted words” of Sir J.P.p. Wilde in Cock v. Cooke (1866) L.R. 1 P.p. 241, 36 L.J.P.p. 5, lies in a misunderstanding of what the words “vigour and effect” are applicable to. They are clearly applicable not to the result to be obtained by, or to the performance of, the terms of the instrument, but to the instrument itself. The question is whether the instrument has “vigour and effect”, and does effect, or is “consummate on execution” to effect, a gift or to create a trust. If the document is “consummate” to create a trust in praesenti, though to be performed after the death of donor, it is not dependent upon his death for its vigour and effect.”

The court went on to also adopt another Alberta Court of Appeal case, Anderson (Costello) v. Patton, [1948] 1 W.W.R. 461, [1948] 2 D.L.R. 202 (Alta. C.A.), which stated at p.p. 463:

“The question of whether a document evidencing a voluntary settlement, either by way of gift, in the sense of transferring the property in question, or by way of the creation of a trust, is or is not testamentary, depends upon the intention of the settlor.

If the document is not intended to have any operation until the settlor’s death it is testamentary.

If the document is intended to have and does have the effect of transferring the property or of setting up a trust thereof in praesenti, though to be performed after the settlor’s death, it is not testamentary.

The reservation of a power of revocation is not inconsistent with the creation of a valid trust and does not have the effect of making the document creating it testamentary.”

An important aspect of the Wonnacott decision is that the court did not examine the subject document in isolation, but instead looked at the larger picture as to what was intended by the donor . The court accepted that in determining whether a transaction amounts to a testamentary disposition, the court is not limited to an examination of the document of transfer itself, and may look at extrinsic evidence relating to the creation of the document. The Court of Appeal adopted the rule set out in Riddell v. Johnston, 66 O.L.R. 554, [1931] 2 D.L.R. 479 (H.C.) that [at p. 482, D.L.R.]:

“In determining what was the real transaction and its nature and effect, the other documents which were made concurrently with the conveyance and which set forth important parts of the bargain which were not embodied in the conveyance itself, and which expressed the intention of the parties should not and cannot be disregarded. ”

B) National Trust Co. v Robertshaw (1986) 5 W.W.R. 695

This case involved the issue as to whether or not a previous designation of a beneficiary in an R.R.S.P. was a testamentary disposition which had been revoked by a subsequent will.

In 1967 the deceased, Robertshaw., designated his wife the beneficiary of a R.R.S.P. (R.R.S.P. No. 1). In 1972 Robertshaw and his wife were divorced. In July 1985 Robertshaw transferred funds from three other R.R.S.P.s into R.R.S.P. No. 1. In August 1985 Robertshaw with her executed a will revoking all former testamentary dispositions and leaving his estate to his three children. The will made no mention of any R.R.S.P. The executors of the will took the position that the 1967 designation of a beneficiary in R.R.S.P. No. 1 was a testamentary disposition which had been revoked by the will. They applied pursuant to R. 18A for a declaration that they were beneficially entitled to receive the proceeds of the R.R.S.P.

Judge Boyd held that while any instrument which is entirely dependent for its vigor and effect upon death must be held to be testamentary,the full “vigor and effect” of the designation of the beneficiary contained in the R.R.S.P. was not entirely dependent on the death of the annuitant as the annuitant may well have affected an inter vires transfer of a contingent interest.

Justice Boyd quoted the following passage from Professor Feeney in Canadian Law of Wills:

“As Professor T. G. Feeney has pointed out in the Canadian Law of Wills, 2nd ed. (1982), vol. 1 (Probate), there is no clear dividing line between a revocable trust inter vivos and a testamentary disposition. Rather, a Canadian court will likely base its decision on the degree of control retained by the settlor. As the learned author states at pp. 11-12:

A court will scrutinize each transaction very carefully, asking itself such questions as the following: Does the settlor retain a life interest or the right to the income from the property until his death? Does he have the right to revoke the trust or withdraw from the scheme? (And what is the effect of revocation? Does he get the property back for himself?) Does he have the right to change the beneficiaries? Does he control the investments that are to be made? Does he have the right to encroach on the capital of the fund?

Clearly the retention of a life interest means nothing by itself, but taken together with such indicia of control over the corpus or capital as the right to revoke, particularly if revocation means getting back complete control of the property, the right to change the beneficiaries, the right to control the investments, or some combination of these and especially the right to encroach on the corpus or capital, is very apt to result in a court declaring the transaction testamentary and void for want of due execution. Control is a question of degree, and exactly when a Canadian court will consider that the settlor retains too much control is difficult to say.”

C) Albert v Albert (1982) 13 E.T.R. 149

In this case the court examined an estate that consisted of two term deposits that were held jointly between the deceased and his two daughters which he alone managed and he alone received the interest. An application was brought regarding entitlement two term deposits after his death.

The Court held that although the deceased had exercised sole management of the term deposits before his death, in the absence of evidence to the contrary they constituted a present gift of a joint interest, not a testamentary gift or a donatio mortis causa. The fact that one of the deposits did not contain the words “or survivor” had no effect upon this daughter’s survivorship rights.

The Court went on to state the law re joint interests as follows:

” In my opinion, a correct statement of the law is as follows: Unless the evidence supports a contrary conclusion, in the typical case of a joint account being established by one of the parties, or of money being deposited by one party as an investment with a financial institution in the names of that party and another party jointly with a right of survivorship, there is a present gift of a joint interest, not a testamentary gift or a donatio mortis causa.

As Ferguson J.A. said in Re Reid (1921), 59 O.L.R. 595, 64 D.L.R. 598 at 608 (C.A.):

If there was a present gift of a joint interest, it seems clear that it was neither a testamentary gift nor a donatio mortis causa, because it is an essential of both that no title vests until the death of the donor: White & Tudor’s L.C. 8th ed., p. 425. The title in right of survivorship was an incident of the joint ownership, an accretion to a title already vested — the donee’s absolute title to the fund arose by operation of law, and not, I think, by reason of two separate gifts, i.e., first, a gift of the joint interest, and, second, a gift of a complete and absolute ownership effective only and on and after the death of the donor.”

D) Hutton v Lapka Estate (1991) 44 E.T.R. 231

The decision of our Court of Appeal in Hutton v Lapka illustrates just how far our courts will go to seemingly try and find that a document is not testamentary in nature if it has even a small immediate effect, and is thus not totally dependant on death for its “vigour and effect”.

The case dealt in part with an action brought by the administrator of the deceased estate on a $295,000 interest-free promissory note signed by a third party in favor of the testator before his death. The note was given as security for a loan for a land purchase and was to be forgiven in the event that the testator died. The trial Judge held that the forgiveness provision of the promissory note was ineffective because it was a testamentary disposition which failed because it was not properly executed pursuant to the Wills Act.

The Court of Appeal allowed the appeal on the basis that the promissory note was not a testamentary disposition, but instead was a contract which had immediate effect . The trial judge was found to have erred in considering the forgiveness clause in isolation from the provisions of the note as a whole, and in holding that separate consideration was needed for the forgiveness clause. The Court followed its previous decision of Wonnacott.

E) Hecht v Hecht ( 1993) 7 W.W.R. 295

Here our Court of Appeal dealt with a Wills Variation action that dealt with inter alia an estate planning scheme devised by Mr. Hecht immediately prior to his death whereby he gifted $9 million through the use of promissory notes. No demand could be made on the promissory notes until 60 days after the testator’s death.

The trial judge found that the promissory notes were inter vivos gifts, and the Court of Appeal did not disturb that finding . The trusts were properly constituted and had “vigor and effect” from the time they were settled and funded, which was before the testator’s death. The fact that they were funded by promissory notes that were not payable until 60 days after the death of the deceased did not alter this.

F) Corlet v Isle of Man Bank Ltd. (1937) 3 D.L.R. 163 ( Alberta Court of Appeal)

The Alberta Court of Appeal upheld a lawyer’s scheme to avoid succession duties as a valid injury vivos transfer, even though the trust was totally revocable by the settlor. The scheme involved the transfer of three life insurance policies are on the life of the settlor to a bank as trustee for the named beneficiaries. In lieu of a will, a the trust document provided the disposition of the proceeds of the policies among those named beneficiaries on the settlor’ s death.

The Court held that the beneficiaries obtained in immediate interest, namely the future interest or right to obtain the proceeds of the policies on the settlor’s death, was vested in immediately on the execution of the trust. Because the settlor had a right to revoke the trust during his or her lifetime, the Court held that the gift had vested. Death was not the event that gave rise to the beneficiaries’ interest in or right to the property, it was the execution of the trust. For a transaction to be testamentary, the death must be more than incidental to the enjoyment of the property : it must be the event that gives rise to the right to so that it can be said that there was no right of any extent vested in the beneficiaries before death.

Professor. Feeney in his book Canadian Law of Wills states

“It should be observed that in the Corlet case, the property involved life insurance policies, rather than an existing fund of money, and that my revocation, the settlor could not get the return of the property for himself, which would have been the case of the property were an existing fund . This is an important distinction and, among other matters, casts some doubt on the non testamentary validity of a revocable trust of an existing fund payable only on the settlor’s death and entirely under his or her control during his or her lifetime.

By analogy, and in the absence of applicable legislation, non testamentary designations of beneficiaries under various insurance and retirement benefits scheme may depend, in part, on whether the person making the designation is entitled to receive or to recover any personal benefit if he or she revokes the designation during his or her lifetime.”

3. CASE LAW WHERE THE DOCUMENT IS TESTAMENTARY

A) Carson v Wilson (1961) O.R. 113 (C.A.)

The deceased Wilson owned certain parcels of land and executed deeds and lodged them with his solicitor with instructions to hold them and not deliver them until after his death. It was always understood that Wilson could demand to documents back at anytime. Wilson managed the properties until his death. The court held that the transactions were ineffective to transfer title as there was no delivery of the documents, and in any event, they were not intended to take effect until his death. The court found that the transfers were testamentary in nature, and since they did not comply with the formalities of the wills act, they failed. It was also found by the court that the could not take effect as inter vivos trusts, because Wilson retained complete control over the properties while he lived, and he did not intend to create an inter vivos trust.

B) Re Bottcher Estate ( 1990) 45 E.T.R. 19

In 1980 the testatrix purchased an R.R.S.P. from a trust company, designating her son as beneficiary. The application form was accepted by the trust company over the signature of its agent, although the testatrix’s signature did not appear. The R.R.S.P. was transferred to another trust company in 1984 and the transfer documents recorded that the son had contributed to it. In 1987 the testatrix made her will, which contained a general revocation clause, revoking all former wills and testamentary dispositions.

The administrator applied to the court under s. 88 of the Trustee Act for inter alia directions with respect to the entitlement to the R.R.S.P.,

The court held that the designation was testamentary in nature, but was not affected by the general revocation clause in the will. While s. 46(3) of the Law and Equity Act provides that a designation of a beneficiary may be revoked, it does not indicate a manner of revocation. The legislature has specifically permitted beneficiaries to be designated without complying with the formalities of the Wills Act, not only as regards R.R.S.P.s, but also insurance policies and employee benefit plans. Specific provisions are made for revocation in the case of insurance policies and employee benefit plans. To conclude that only designations under an R.R.S.P. would be caught up by a general revocation clause in a will would be incongruous and defeat the apparent legislative intent. Accordingly, something more than a general revocation clause in a will is required to revoke a designation validly made other than by will. Moreover, it has been held that a general revocation clause in a will does not in every instance revoke previous dispositions made by will or outside a will, at least if the court is satisfied that there was no intention to revoke a particular gift or legacy.

C) Reference Re Pfrimmer estate (1936) 44 Man.R. 96

Pursuant to a plan to avoid probate costs and succession duties with respect to his estate, the deceased executed transfers, duly registered, of his properties to himself, his wife, his son, and his son-in-law, as joint tenants. At the same time an agreement, entitled “Declaration of Trust” , was executed by all four.

The Court held that the conveyances and the writings were intended by the deceased to take the place of a testamentary disposition under The Manitoba Wills Act, in order to avoid probate expense and succession duties, and not to create an irrevocable trust by a binding transfer of the properties. The court cited to following passage:

” The law is clear that, to give validity to a declaration of trust of property, it is necessary that the donor or grantor should have absolutely parted with his interest in the property, and have effectually put such interest beyond his own reach. See Warriner v. Rogers (1873) L.R. 16 Eq. 340, 42 L.J. Ch. 581; Richards v. Delbridge (1874) L.R. 18 Eq. 11, 43 L.J. Ch. 459; In re Shield; Pethybridge v. Burrow (1885) 53 L.T. 5. Whatever may be the form of an instrument, if the person executing it intends that it shall not take effect until after his death, and it is dependent upon his death for its vigour and effect, it is not a trust: In re Cassidy (1832) 4 Hagg. Ecc. 360, 162 E.R. 1477; Cock v. Cooke (1866) L.R. 1 P. 241, 36 L.J.P. 5; Sproule v. Murray (1919) 45 O.L.R. 326. Thus, in Malin v. Keighley (1794) 2 Ves. Jun. 333, 30 E.R. 659, the Master of the Rolls said:

I will lay down the rule as broad as this; whenever any person gives property, and points out the object, the property, and the way it shall go, that does create a trust, unless he shows clearly, that his desire expressed is to be controlled by the party; and that he shall have an option to defeat it.

Hence it is the rule that an instrument even though in the form of a deed which is not to become operative until the maker’s death is testamentary in its character, and its operation depends upon its execution complying with The Manitoba Wills Act: Habergham v. Vincent (1793) 2 Ves Jr. 204, 30 E.R. 595; Shinbane v. Minuk, 36 Man. R. 530, [1927] 2 W.W.R. 121; Hill v. Hill (1905) 8 O.L.R. 710; Towers v. Hogan (1889) 23 L.R. Ir. 53.”

D) MacInnes v MacInnes (1935) S.C.R. 200

This Supreme Court of Canada case involved an insured who was a member of a fund established by his employers in the nature of insurance or provision for the future of such employees who joined. If a participating employee died, an amount was payable to his beneficiary as designated by him, and he might change the beneficiary or revoke the designation. In an instrument called the “Employee’s Acceptance”, the insured directed the trustees of the fund upon his withdrawal therefrom to pay to him the amount to which he was entitled, upon his death to pay such amount to his wife, or otherwise as he might have last designated by writing lodged with the trustees, or by will. The document was witnessed by one witness only, and the Court held that the document was testamentary in nature and was thus ineffective to allow the named beneficiary to take. The insured’s share in the fund became part of his estate as the right of the beneficiary was dependant upon the death of the participating employee for its “vigour and effect”.

4. CONCLUSION

The issue as to whether or not a document is testamentary in nature is an interesting yet somewhat confusing area of the law. The general principle of law is that if at the time of its execution, the document is legally effective to pass some immediate interest in the property, no matter how slight, then the transaction will not be classified as testamentary. In many of the cases the courts have taken a very liberal approach to find that an immediate interest in the property has been created that is not dependent on death for its “vigor and effect”. Nevertheless, estate solicitors should be well aware of the possible pitfalls in the drafting of documents that are not intended to be testamentary in nature, but by reason of estate planning procedures, could very well be deemed to be such by a subsequent Court, if proper care is not applied.

Dealing with Lost Wills

Dealing with Lost Wills - Disinherited

An update to this article is that since the introduction of WESA on April 1, 2014, I anticipate that the courts will be more willing to allow copies of wills as proof of the testator’s intention to more easily admissible into probate.

Many estate practitioners will face the situation where the original will cannot be located following the death of the testator.  There are many variations on the fact patterns surrounding such lost wills and any number of reasons the original will cannot be located.

At common law, where a validly executed will is shown to have last been in the custody of the testator, and that will has not been located despite every effort, then, in the absence of evidence to the contrary, a presumption of revocation by the testator arises.  In other words, the law presumes the testator has destroyed the will with the intention of revoking it. This presumption also applies to the copies i.e. any executed copies are deemed to have been revoked as well.

In this paper we will examine this presumption of law and review some of the cases where evidence to the contrary has been offered to rebut the presumption. Most of the cases focus on whether or not the presumption has been rebutted on the facts of the particular case.

The Presumption of Revocation – Leading Cases

1. Sugden V. Lord St. Leonards (1876) 1 P.D. 154 (C.A.).

In this leading case, Lord St. Leonard’s will could not be found following his death.  His daughter, however, had read the will so many times that she was able to reproduce almost all of its provisions verbatim.  In this case, the court was satisfied with the honesty of the witness and her ability to recall.   Further, they were convinced the daughter had accurately related the testator’s intentions.  The court thus admitted into probate the daughter’s memorandum of the contents of her father’s will.

In terms of the legal presumption the court further held it would consider if there other explanations for inability to locate the will, that is explanations other than the intentional destruction by the testator.

The court further held that a testator’s declarations as to the contents of the will were admissible to prove those contents.  The court held the declarations were admissible whether they be made before or after the will was signed and whether the declarations be oral or written.

As to the strength of the presumption of revocation, the court said this would depend on the character of the custody the testator had over his will.

In this case, the court found Lord St. Leonard was a person who regarded his will as of the utmost importance.  They found that since there was no evidence that he deposited the will with others for safekeeping, he likely would have kept it in his possession. The court concluded that it was “obvious that the will may have been inadvertently burned when the testator’s personal effects were destroyed after his death”.

The court opined “it seems utterly impossible that, under the circumstances, such a man as Lord St. Leonard’s would voluntarily destroyed his will, whether for the purpose of revoking it or making another, or for any other purpose  that could be considered”.

  1. Lefebvre v. Major(1930) S.C.R. 253

The Supreme Court of Canada followed Sugden v. St. Leonard sin admitting into probate a copy of a will.  In this case, the deceased’s banker had sent him his will, however, upon his death, it could not be located. A few weeks before his death, the deceased had told a close friend “his papers were fixed up so that everything went to his sister after his death.”

As in the Sugden case, the court found that the deceased regarded his will of the utmost importance.  The court held that the testator was simple man who was affectionate to his sister and that he would not have intentionally destroyed his will.  Again, as in Sugden, the court speculated the will had been “inadvertently burned” with the rest of his personal effects.

3. A different approach was taken in another leading Canadian case Sigurdson v. Sigurdson (1935) 4 D.L.R. 529.

Sigurdson had taken his original will home from his lawyer’s office. All of his family read the will and it was put in a small locked metal box which Sigurdson kept.   He also kept an unlocked wooden box in which he had other personal papers.  From time to time, Sigurdson would move papers from one box to the other. Just prior to his death he told a son by his first marriage that he did not have a will because everything would divided up “according to law”.

In the subsequent litigation, the court found Sigurdson to be a person who knew exactly what papers he had in his metal box.  The trial judge concluded that he revoked his will so as to allow his wife and his children from both marriages to share by operation of law.  The Supreme Court of Canada upheld the trial decision which applied the presumption of revocation and refused to admit into probate a copy of the will.

In the Supreme Court decision, Davis J. stated that “it needs to be clear and convincing evidence to establish what is alleged to be a lost will. The person propounding such a will has a burden of proof that persists throughout the whole trial to satisfy the court at the conclusion that he will is in fact lost and that it was not destroyed by the testator with the intention of putting it to an end.”

For other decisions where the court has found the presumption was not rebutted see:  Re Wagenhoffer 22 E.T.R. 60 ( Sask. C.A.), Re Wellwood (1982) 19 Alta.L.R. (2d) 268,Kennedy v. Peikoff (1966) 56 W.W.R. 381 ,Re Singh (1912) 1 W.W.R. 472, and Re Perry (1925),56 O.L.R.278)

Review of Cases where the Courts find the Presumption to be Rebutted

A review of the “lost will” cases could lead one to conclude that the courts are very open to finding the presumption has been rebutted.  In spite of the legal presumption, the courts seem to be very reluctant to find that a testator has deliberately revoked a will by destroying it.

There are many cases where, based on evidence which is relatively weak, the courts permit a copy of a will or other sufficient evidence of the will to be admitted into probate.

1.  A leading British Columbia case is Unwin v. Unwin (1914) 6 W.W.R. 1186.

Mr. Unwin had prepared a will leaving everything to his wife.  He placed the will in an envelope and gave it to his wife to put in a drawer with his other papers.  After his death the will could not be located.

Mrs. Unwin testified that she and the deceased had a harmonious marriage and that the deceased never expressed any intention to revoke the will. The court found that Mr. Unwin had no motive to make another will. The Court believed the testimony of the wife and admitted a copy of the will into probate.

The court held that it was entitled to consider the relationship between the deceased and his wife, also his words and actions subsequent to the execution of the will, and any circumstances which may tend to support or rebut the presumption of revocation.

In rebutting the presumption the court relied on Sugden v. St. Leonard’s where Chief Justice Cockburn stated “The presumption will be more or less strong according to the character of the custody which the testator kept over the will”.

2.Both Unwin and Unwin  and Sugden v. St. Leonard’s were followed in Brown v. Woolley  (1959) 29 W.W.R. 425.  In this case a B.C court admitted into probate a carbon copy of the executed after the original was lost. The court based its finding on the uncorroborated evidence of an interested party who the court, nevertheless, found to be a reliable witness.

In all three cases the court found the presumption of revocation to be rebutted based on evidence by “by trustworthy witnesses” as to the deceased’s declarations made shortly before death as to the dispositions made in his will.

3.  Holst Estate v. Holst39 E.T.R. (2d) 218.  This is a recent B.C. case that typifies the kind evidence required to rebut the presumption of revocation.

In 1988 the deceased and his son were the owners, as tenants in common, of a parcel of land. The father had given the son’s share to him as a gift.  Six years later the father wrote a will dividing his estate equally amongst his children. He later realized that, in effect, he had already given this one son an inheritance equal to the shares of the estate left to his other children.  The father thus executed a codicil to revoke this one son as a beneficiary under his will. After his death this codicil could not be found.

The court found that the presumption had been rebutted because:

a)     eight months before his death the deceased had told his lawyer that he had executed such a codicil;

b)     evidence showed that the codicil could have been lost;

c)      it was not the deceased’s character to have intentionally destroyed his codicil;

d)     evidence did not support the contention that the codicil was intentionally destroyed by the deceased;

e)     the deceased had numerous documents throughout the house that were not organized;

 

1. Dementia

A testator must have sufficient mental capacity to be able to revoke a will. Doubtless many seniors “squirrel away” their wills, and then forget where they have put them.  Thus a will lost by a testator who ultimately becomes incapable, creates a legal dilemma.  Often it  is not clear when the will was lost in relation to the deceased’s loss of legal capacity.  Did the person intend to revoke the will?  Did that person have legal capacity at that time?

In re Broome (1961) 35 W.W.R. 590, the Manitoba Court of Appeal held that the burden of showing that the will was destroyed before the onset of insanity lies on the party asserting revocation.

This case was followed in the British Columbia of Eaton v. Heyman (1946) 63 B.C. R. 62

2. Suspicious Circumstances

The presumption of revocation may be rebutted if it can be shown that a person who stands to benefit from the loss of the will has fraudulently destroyed it.

In Re Weeks,(1972) 3 O.R. 422, the court refused to make an inference of fraudulent destruction in spite of what the judge characterized as “very suspicious circumstances”. Instead the judge applied the presumption of revocation and declared an intestacy.

In this case, the evidence showed that the deceased’s wife had been badgering him to amend his will and leave a larger share to her. She alone had access to the locked drawer where the will was kept.  She stood to inherit much more if the will were not found and he died intestate.  Nevertheless the court applied the presumption of revocation and found the will was presumed to have been destroyed by the deceased and thus revoked.

In Re Perry [1925] 1 D.L.R. 930 (C.A.), the court refused to allow a copy of a lost will into probate and declared an intestacy.

Justice Middleton  stated  “… when a testator has possession of his testamentary instrument, and it is not forthcoming at the time of his death, the presumption is that he destroyed it. The presumption is against fraudulent abstraction either before or after death, but circumstances which render the abstraction possible must be taken into account in weighing the evidence.”.

3. Accidental Loss or Destruction

In Allan v. Morrison, [1900] A.C. 604 the Privy Council upheld the decision of the New Zealand Court of Appeal who, in rendering their appeal judgment, had said as follows:

“The hypothesis of accidental loss or destruction is unreasonable. There is a presumption against the hypothesis of fraudulent abstraction. There is a reasonable possibility that the deceased destroyed the will himself. In order to find for the will we must be morally satisfied that it was not destroyed by the testator animo revocandi.”(with an intention to revoke)

Requirement for Proof of the Contents and the Will’s Execution

Even once the presumption of revocation is rebutted, probate will still only be granted if there is sufficient proof of both the contents of the lost will and its due execution.

The contents of the will may be established on secondary evidence such as the solicitor’s notes, or a copy, or any other such written evidence.   For example, in re Dreger 13 E.T.R. 212 a carbon copy of the will was admitted into probate.

Secondary evidence of the contents of a will may include:

1)     the solicitor’s notes, or a typed copy or carbon copy;

2)     oral testimony of someone having direct knowledge of the contents, such as the solicitor who prepared the will;

3)     pre-testamentary or post-testamentary statements of the testator, whether written or oral;

In weighing such evidence, the court will carefully scrutinize the evidence of anyone who stands to benefit from the contents proposed.

The Presumption applies only if the will was in the Possession of the Testator.

In Re Flaman Estate (1997) 18 E.T.R. 305, the court confirmed that the presumption to intentionally revoke a will is only established when the will is last traced to the possession of the testator. In this case the deceased was in a nursing home and thus  the will’s possession could not be last traced to him.

Conclusion

In summary, the caselaw currently provides that where a missing will was last known to be in the possession of the testator before his death, the presumption is that the testator destroyed the will with the intention of revoking it.

This presumption may be rebutted by the following evidence:

1)     words or actions of the testator either before or after the execution of the will; or

2)     a codicil that refers to the will; or

3)     evidence of the character of the testator and his treatment towards the beneficiaries during his life; or

4)     statements made by the testator about the provisions made to beneficiaries.

Even if the existence of will is proven and the presumption rebutted, two further matters must still be established–the contents of the will and its proper execution.  Only once these elements are proven will the court admit a copy of the will, or other sufficient evidence, in place of the original will.

Like many other areas of estate law, the law purports to be clear, however its application is at times apparently inconsistent. It seems the courts are reluctant to declare an intestacy, and will often go to some lengths to find sufficient evidence to rebut the presumption of revocation.

Forfeiture Clauses in Wills

Forfeiture Clauses

Bellinger v. Fayers, Nuytten  2003  BCSC  563 discussed inter alia forfeiture clauses in wills

On June 11, 2002, Justice Hood handed down Reasons for Judgment, subsequent to the trial reasons,  in the case of Bellinger v. Fayers, Nuytten.

In this case I represented the plaintiff, Roy Bellinger who together with his cousin, Phil Nuyten contested Roy’s mother’s will.  In particular, the cousins contested the distribution under the will which left Roy a $40,000.00 gift and Phil a gift of an agreement for sale valued at $15,580.00.  The residue (there was little of that) was to be shared equally by Roy, Phil and Roy’s sister, Beverly, the daughter of the deceased.

Phil and Roy’s complaint was with a purported inter vivos transfer of the deceased’s home to Roy’s  sister Beverly.  The plaintiffs alleged that the home should form part of the estate assets. In particular they made a number of claims arising from common law.  Briefly these claims were the following:

  • The will violated a previous oral agreement that the estate be split equally among the three of them
  • The will was the result of undue influence exercised by Beverly over her mother.
  • Beverly wrongfully directed her mother’s assets to herself before her mother’s death.
  • The deceased’s house had been transferred to Beverly prior to death, under a sham agreement of sale, possibly forged by Beverly

In addition, Roy brought a statutory claim.  He contested the will on the ground that it did not adequately provide for him as required by the Wills Variation Act, R.S.B.C. 1996, c. 490.

After nine days of trial, Justice Hood dismissed both the common law and statutory claims brought by the plaintiffs.

With regard to Roy’s claim under the Wills Variation Act, Justice Hood found that $40,000 was more than adequate, just and equitable in the circumstances.  As a result he did not increase that provision under the will.

Surprise

Following the reasons for judgment at trial, Beverly’s counsel raised the forfeiture clause contained in the will.  He claimed that both plaintiffs had forfeited their inheritances under the will by reason of that provision!  Counsel maintained the forfeited gifts should fall into the residue of the estate to be distributed exclusively to Beverly!

The Forfeiture Clause

The deceased’s will contained the following forfeiture provision:

7.        IT IS MY FURTHER DESIRE, because of an expressed intention of one of the legatees to contest the terms of this my Will, that should any person do so then he or she shall forfeit any legacy he or she may be otherwise entitled to.

At trial, only fleeting reference had been made to this provision when I asked   Roy during his direct examination if he thought he was the person referred to in that clause.

Given that the clause was not pleaded in the action, nor had there been any submissions as to its effect at trial, I had the opportunity to fully consider this clause for the first time after the initial judgment.

Perhaps, like many of you, I had assumed that such a clause was archaic and would no longer be upheld by our courts.  Like many estate practitioners I expected that the courts would find such a clause to be void as against public policy. This is not entirely correct.  I was surprised to learn that these clauses, when properly drafted, remain a possible option in estate planning.

There is very little case law dealing with this area of estate law.  The few reported cases are old and perhaps do not reflect modern public policy concerns.

In terrorem clauses

Forfeiture clauses were permitted at common law, however their scope was limited by the ecclesiastical courts who developed the in terrorem rule.  Initially, this in terrorem rule applied only to gifts of personal property.  The courts of equity later expanded it to include both real property and chattels.

In general terms, the in terrorem rule provided that the courts could find a forfeiture clause void

  • if a gift was conditional, and
  • if those conditions were in the nature of a threat and
  • if there was no gift over to an alternate beneficiary in the event the condition was not met.

According to Feeney’s Canadian Law of Wills, Fourth edition, if, and only if, there is the required gift over, a conditional gift may be valid.  With a gift over, such a clause will be valid unless the forfeiture condition:

  • is in total restraint of marriage; or
  • prevents a beneficiary from instituting any litigation, whatever concerning the testator’s estate is void

According to Feeney, even if otherwise valid, the conditions must contain the qualifications mentioned (ie. permit some marriages, or permit some litigation).  Otherwise they are prohibited as contrary to public policy.  Feeney explains at

16.61:

“But a condition in partial restraint of marriage is good, as is a condition against disputing a will that does not preclude all litigation.  These qualified conditions are not contrary to public policy.

In these two cases, however, if the gift is one of personalty, or a mixed fund representing both realty and personalty, (but not, it seems, in the case of the devise of land), unless there is a gift over, the court will consider the condition as being in terrorem and void, although normally the condition will not be void if there is a gift over.  The reason for the rule is that the court considers an expressed gift over to someone else sufficient prime facie evidence that they gift was not in terrorem; the presence of the gift over tending to show that the condition was inserted not simply to coerce the original donee but also to fix a possible benefit to another.”

Modern Law

There is little modern Canadian case law considering forfeiture clauses.  This is perhaps because such clauses are relatively rare.  In any event, I could find only one previous BC decision to assist me.

Justice Hood’s ruling on the forfeiture clause

In response, to Beverly’s claim that the forfeiture should occur, we brought on a motion seeking a declaration that clause 7 was void.  We maintained it should thus have no effect on the gifts to the two male beneficiaries.  Our application was granted in reasons delivered April 14, 2003.

In this second set of reasons, Justice Hood found Clause 7 had very likely been included because Roy had told his mother he intended to contest the terms of her will.  Specifically Roy had told her he would contest her transfer of the house to his sister Beverly.

Justice Hood reviewed the excerpt from Feeney quoted above.  He then discussed the gift over required to validate a forfeiture condition.  He stated as follows:

“The gift must be accompanied by an effective gift over which vests in the recipient on the condition being breached.  If there is no gift over, then the condition will be treated as merely in terrorem, that is a mere threat, and will be found to be void.  And nothing short of a positive direction of a gift over, of vesting in another, even in the case where the forfeited legacy falls in the Residue, will suffice.  There must be an express disposition made of what is to be forfeited.  See for example Theobald on Wills, 15th ed. (London:  Sweet and Maxwell, 1993) at p. 656, Wheeler v. Bingham, [1746] 26 E.R. 1010 at p. 1012 and Lloyd v. Branton (1817), 36 E.R. 42 particularly at p. 46.  Thus the application of the general rule that a failed gift falls into Residue is insufficient for the purpose of the rule.”

Justice Hood also quoted extensively from the decision of  Kent v. McKay (1982), 139 D.L.R. (3d) 318 (B.C.S.C.), where  Lander J.  considered the following condition:

“if any person who may be entitled to any benefit under this my Will shall institute or cause to be commenced any litigation in connection to any of the provisions of this my Will other than for any necessary judicial interpretation thereof or for the direction of the Court in the course of administration all benefits to which such person would have been entitled shall thereupon cease  [the] said benefits so revoked shall fall into and form part of the Residue of my estate to be distributed as directed in this my Will”

In that case, Justice Lander had found that the clause was valid because of the gift over that was made to the residue of the estate.   He however went on to find that such a clause could not effectively apply to a statutory claim made under the Wills Variation Act.

In the Bellinger case, Justice Hood distinguished the clause in Kent v. McKay because it had provided specifically for a gift over to the residue of the estate.  In Bellinger, there was no specific gift over.  Instead the failed gift would fall into the residue by operation of law.  In the view of Justice Hood this was insufficient to remove the clause from the application of the in terrorem rule.

Public Policy and Statutory Claims under the Wills Variation Act.

In his reasons Justice Hood also addressed the application of the in terrorem rule to statutory claims.  In this portion of his analysis he was able rely specifically on the reasoning of Justice Lander in  Kent v. McKay (supra).

In Kent v. McKay Justice Lander had found the forfeiture clause void in so far as it purported to limit claims the Wills Variation Act.  He found the condition contrary to public policy because it attempted to penalize the legatee for bringing a successful action provided by statute

In reaching this decison Justice Lander relied on the Australian case Re Gaynor,(1960) V.R. 640 (S.C.), He then found as follows:

“It cannot be denied with respect that the intent of the Legislature in creating the Wills Variation Act, is to ensure adequate maintenance and support for specified individuals.  It is a matter of public policy that support and maintenance be provided for those defined individuals and it would be contrary to such policy to allow a Testator to circumvent the provisions of the Wills Variation Act by the creation of such as para. 9.”

Thus, following this rationale, Justice Hood concluded that clause 7 was invalid for two reasons, namely:

1) Clause 7 is invalid at Common Law, and cannot be enforced by the Court, because of the lack of a provision for a gift over of the benefits in the event of their being forfeited as a result of a breach of the Clause;

2) that the Clause is void as well with regards to Roy’s Wills Variation Act claim in that it is against public policy.

Conclusion

The Bellinger decision thus stands for the following propositions :

1)         A will provision providing for forfeiture if the will is contested, is ineffective in so far as it relates to a claim under the Wills Variation Act.   It is void as contrary to public policy as it attempts to prohibit valid statutory claims.

2)         A properly drafted forfeiture clause, may be effective in so far as it relates to a beneficiary’s claim brought at common law, provided there is a gift over.

3)          A properly drafted forfeiture clause, is legal and enforceable in so far as it relates to common law claims, but not the Wills Variation Act.

Thus, if a legatee makes a successful statutory claim under the Wills Variation Act, he or she should not lose the gift.  It would be contrary to public policy to penalize the legatee for bringing a successful action provided by statute.

See Harrison v. Harrison (1904) 7 O.L.R. 297.