Wills Drafting: The Myth of the “Simple Will”

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

It must be stressed that any document that has consequences as permanent and far-reaching as a Will can never be “simple.”

Even a straightforward Will can be fraught with drafting problems and potential liability.

A Will speaks from death and cannot be altered after death. Thus Wills can be viewed as potential
“time bombs” of liability. Although sections 58 and 59 of the Wills, Estates and Succession Act now allow an opportunity to correct errors, to confirm what the testator really meant, to fill in the gaps, or to modify the ambiguous, a small drafting error can create an ambiguity that may take years to resolve in the Courts.

A Will is a very personal document, quite literally, a testator’s last word about how his or her
estate is to be disposed of. The only constraints on the testator’s wishes are public policy and the law. If neitheris contravened, the testator can make almost any type of Will.

Duties of the Wills-Drafter

The Wills practitioner has several important duties, including the following.

1. Spending sufficient time to properly canvass with the client his or her instructions, and then understanding those instructions precisely after giving appropriate advice with respect to same

2. Translating the instructions into testamentary provisions that are valid and clearly express the testator’s intentions

3. Gathering all the information required to properly prepare the Will and to give effect to the testator’s wishes

4. Taking into account other documents to which the testator is a party, such as those dealing with assets that pass outside of the estate, and applying legal principles that may affect the provisions of the Will

Simply put, it is the Wills practitioner’s duty to ask the right questions and draft the Will properly in accordance with the client’s instructions.

Fees

1. Fees should be based on the practitioner’s actual time and not the supposed “going rate.”

2. The practitioner should explain to the client the amount of time it properly takes to prepare a Will, the amount of expertise required for same, the risk of liability, and the value of the assets that are being dealt. That will help persuade the client that the cost may be higher than he or she wishes to pay, but that it is still good value in the “big picture” of things. It should be stressed that the Will is dealing with the client’s lifetime accumulated assets.

3. If the client is unwilling to pay, then it is open to the practitioner to refuse to do the work.

4. If the practitioner accepts the work, he or she accepts the responsibility of doing it properly and promptly.

Getting the Necessary Information From The Client

Clients frequently attend at the Will- drafter’s office with firm instructions about how they want to dispose of their estates. It is the Will-drafter’s duty to properly examine and scrutinize such instructions because many of them may be neither practical nor advantageous to the interest of the estate or to the beneficiaries. The Will-drafter must educate the client and explain to him or her the nature and consequences of the proposed testamentary provisions.

It is not uncommon for the client’s initial instructions to be flawed. Clients often have firm opinions as to what they want to achieve with their Will that are often simply not practical, or even possible, and would almost certainly end in litigation. It is the job of the drafting practitioner to provide proper objective counsel in this regard.

To get the correct information, the practitioner must ask the right questions. The Will practitioner can simply never have too much information to give proper advice.

The bottom line is there is a duty on the Will-drafter to carry out the client’s instructions as closely as possible, but there is an equally important duty to make sure that clients understand they should not necessarily do what they want to do, and if they insist after proper advice, they must accept and approve the consequences.

Probing the Client’s Mind

I would be remiss in any discussion regarding the taking of Will instructions, especially from the elderly and frail, not to start with a wise quote from Chalmers v. Uzelac 2004 BCCA 533.

1. Every solicitor who, as part of his or her practice draws Wills, should read, mark and inwardly digest at least once each year the judgment of Sir John Alexander Boyd, C. in Murphy v. Lamphier (1914), 31 O.L.R. 287, the Canadian locus classicus on a solicitor’s duty in taking instructions, especially at pages 318-321.

2. That duty is owed not only to those who might, or ought to be, objects of the testator’s bounty but also to the testator, for only the solicitor can be the testator’s voice from the grave; the solicitor discharges that duty by making proper inquiries of the testator at the time of the making of the will and by taking and preserving proper notes of the responses and of any observations relevant both to capacity and to knowledge and approval of the contents of the will. The reason for the latter obligation ought to be obvious but, lest it is not, I state it: How can a judge put confidence in the testimony of a solicitor who says, years (here 9) after taking instructions, but keeping no notes of those instructions, that the testator said this or that as the reason for changing an earlier will?

In Murphy v. Lamphier, as cited in the Chalmers case, the duty of a lawyer taking Will instructions was discussed as follows.

It is an error to suppose that, because a person can understand a question put to him and give a rational answer, he is of sound mind and capable of making a Will: the competency of the mind must be judged by the nature of the act to be done, and from a consideration of all the circumstances of the case.

The grand criterion by which to judge, whether the mind is injured or destroyed, is to ascertain the state of the memory. Memory affords all the materials on which to exercise judgment and to arrive at a conclusion or resolution.

In the case of a person enfeebled by old age or with faculties impaired by disease, and particularly in the case of one labouring under both disabilities, a solicitor called in to prepare a Will does not discharge his duty by simply taking down and giving expression to the words of the client, without being satisfied by all available means that testable capacity exists and is being freely and intelligently exercised in the disposition of the property; and, in dealing with a person needing protection and advice, it is important for the solicitor to find out if there be a former Will, and its nature, with a view of getting at the reasons for any variations or changes therefrom, if such changes be contemplated.

The notes of haste, stealth, and contrivance attached to this transaction, and were not removed by the evidence.

The duty was similarly described by Kroft J. in Friesen v. Friesen Estate (1985) 33 Man.R. (2d) (Q.B.) at para 77, as follows.

6. The duty upon a solicitor taking instructions for a Will is always a heavy one. When the client is weak and ill, and particularly when the solicitor knows that he is revoking an existing Will, the responsibility will be particularly onerous.

7. A solicitor cannot discharge his duty by asking perfunctory questions, getting apparently rational answers, and then simply recording in legal form the words expressed by the client. He must first satisfy himself by a personal inquiry that true testamentary capacity exists, that the instructions are freely given, and that the effect of the Will is understood.

Sample Organizational Chart for a Will

One tried-and-true technique of Will-drafting is to break the Will down into its basic components, to demystify the task at hand. Here is a sample of how most Wills can be broken down.

Part One: Initial Matters

(A) Revocation of prior Wills

(B) Appointment of executor and trustee

(C) Appointment of alternate executor and trustee

(D) Appointment of guardian, if applicable

Part Two: Disposition of Estate

(A) Vest property in trustee

(B) Payment of debts, testamentary expenses

(C) Disposition to beneficiaries

(a) Specific bequests
(b) Legacies
(c) Residue
(d) Alternative gift(s) of residue

Part Three: Administration of Estate

Powers of Executor/Trustee
(1) Power of sale or conversion

(2)  Trust for minors

(3)  Payment for minors

(4)  Investment powers

(5)  Power of distribution in specie

(6)  Power to carry on business and other powers that may be necessary or appropriate

Part Four: Closing Matters

Miscellaneous provisions, for example

(1) Charging clause
(2) Funeral wishes

Remember that the client must “know and approve the contents” of the Will. So that can be achieved, 5. the goal should be to draft a Will the client may read and understand for him or herself. The use of a logical arrangement of paragraphs and clauses such as displayed in the above-noted organizational chart will assist the client in that endeavour. The use of headings and definitions and the numbering of paragraphs and clauses will also assist in that regard. Bearing 6. in mind the aging population, using a reasonably large font is advisable.

It should be noted that words used in a Will are given their ordinary meaning by the Courts. Also, a judge should consider only the Will and the facts and circumstances known to the client at the time the Will was made to determine the client’s testamentary wishes.

Style of Drafting: 20 Dos and Don’ts

1. Strive for simplicity without sacrificing precision.

2. Be brief without sacrificing comprehensiveness.

3. Be consistent in the use of tense and the use of terms. All of the clauses to be used must then be looked at together to ensure a uniform drafting style throughout. The Will created must not look like a patchwork quilt of style and language as this could lead to interpretation problems and possible negligence claims.

4. Use modern plain language rather than verbose and archaic expressions. For many years now, there has been a movement toward the use of plain language to replace legalese and bureaucratic writing. Plain language is straightforward prose, carefully written with the needs of its primary readers in mind. Strive to make your average sentence length shorter and to simplify your sentence structure.

5. Eliminate redundant words and phrases. Will-draftspersons have the tendency to use couplets and triplets when one word carries the intended meaning. For example the words “nominate, constitute, and appoint” could be condensed to simply “appoint.” The words “give, devise, and bequeath” could be shortened to simply “give.”

6. Strive to not use foreign words in Wills unless you are referring to foreign places or persons. For example, do not use Latin phrases such as “bona fide” when the English “good faith” conveys the same meaning. Similarly, do not use expressions such as “cy-pres” or “en ventre sa mere,” when they can be replaced with “as near as possible” and “in its mother’s womb.”

7. Do not use the word “issue” that ordinarily means all of a person’s lineal descendants, but instead use the words “child,” “children,” “grandchild,” and/or “grandchildren,” as appropriate. Similarly, do not use the words “per stirpes” or “per capita” but instead describe the method of distribution.

I once litigated the following clause from a Will that used the word “issue.”

To divide the residue of my estate between my daughters Mary and Joan who survive me in equal shares per capita but if any child of mine predeceases me leaving issue him or her surviving, the issue of that deceased child surviving me shall take (and if more than one in equal shares per stripes as tenants in common) the share which his or her or their parent would have taken if living.

The deceased had a son who had predeceased him by 10 years leaving two children. At the time the deceased executed his Will, he had only the two daughters Mary and Joan. The Will was poorly drafted in that it used both the words “any child of mine” as well as the words “leaving issue him or her surviving.” I argued that the issue of the deceased son, namely the deceased son’s children and grandchildren, should share equally in the estate with Mary and Joan.

Leaving aside the poor draftsmanship that resulted in the litigation, I have never yet met a client who wishes to provide for all of his or her lineal descendants. Clients usually wish to provide only for their children, but if a child has predeceased, leaving children of his or her own, then for those children, that is the grandchildren of the client, in the place of the deceased child.

8. Do not do a codicil to revise an existing Will, as it is too easy to make a mistake. Disregard the client’s concerns about costs in this regard. If the client wants to make a change to a Will, then draw a new Will.

9. When providing for the distribution of the estate residue, try to use percentages or shares rather than specific amounts. Then add the percentages or shares several times to ensure they add up to 100 per cent. In Sarkin v. Sarkin Estate, 36 E.T.R.139, the draftsperson did use shares, but the shares added up to only 55 per cent of the residue. As a result, the remaining 45 per cent went by way of a partial intestacy.

10. Do not use precatory words such as “wish” or “request,” as they are not binding on the executor.

11. Be precise in your description of assets to avoid ambiguities.

12. Check carefully for inconsistent clauses.

13. Check to see that no intestacy or partial intestacy has been created. I once litigated a homemade Will where the testatrix included a specific clause stating she did not wish her brother to ever share in her estate by reason of bad past behaviour. She executed the Will without having included a residual beneficiary clause and thus created a partial intestacy. The effect was that her next-of-kin, namely, her brother, inherited.

14. Sufficiently identify each beneficiary and record his or her contact information. Charities can be a particular problem, as it is necessary to understand the structure of the charity and to ascertain which part of the charity the testator wishes to benefit, as well as to ensure the charity’s name is stated correctly. If possible, the charity should be contacted to ensure accuracy. Leaving a bequest to “charitable and educational institutions” will undoubtedly lead to much litigation among various charities and education institutions.

15. Be consistent in the words you use.

16. Try not to include a gift of a specific parcel of property to a beneficiary as there is a good likelihood the testator will not own the property at the time of his or her death. A better way to accomplish such an intention is to use a clause such as “to transfer to Mary, if she survives me, whatever house and property I own at the time of my death,” or such similar-type wording.

17. Only attempt to do the type of Wills with which you are completely experienced and are totally comfortable doing.

18. Review the Will clause by clause very carefully with the client. It should never be a cursory review. It may be helpful to paraphrase each clause to the client in simple terms, as many clients will not really understand what most of the clauses mean. It is suggested that where possible and practical, email, fax, or mail a copy of the Will to the client to review prior to seeing him or her in your office. That will give the client time to consider and reflect on the Will and to make any changes he or she considers appropriate. That is preferable to the client attending at your office and requesting changes to be made on the spot, as such changes are often rushed.

19. Use technology but beware that it sometimes does strange things, like leave out paragraphs and make other such unexplained mistakes.

20. Do not rely solely on a checklist- type Will instruction sheet. Make real notes, including observations confirming you probed the Will- maker’s mind to check for mental capacity and noted his or her statements as to next-of-kin and the value of assets. On completing a Wills file, avoid using a form reporting letter that has clauses that do not relate to the particular instructions.

Conclusion

I again stress there is no such thing as a simple Will. While a Wills practice can be enjoyable and rewarding, the draftsperson can never let his or her guard down for one instant regarding the myriad potential problems that can arise in this type of practice.

The client needs firm advice and guidance throughout the taking of instructions and again during the review of the Will at the time of execution.

 

This article was originally published by The Scrivener Volume 27 Number 4 Winter 2018.

Simultaneous Deaths and Survivorship

Simultaneous Deaths and Survivorship | Disinherited Estate Litigation

The law relating to simultaneous deaths and survivorship is set out in section 5 WESA.

If two or more persons die at the same time or in circumstances that make it uncertain which of them survive the other or others, unless a contrary intention appears in an instrument, rights to property must be determined as if each had survived the other or others.

S 5(1) states that if two or more persons hold property as joint tenants, or hold a joint account, and both of them all die at the same time or in circumstances that make it uncertain which of them survive the other or others, unless a contrary intention appears in an instrument, for the purpose of determining rights to property, each person is deemed to have held the property or account as tenants in common with the other or with each other or others.

Under previous legislation the younger person was to have been presumed to outlive the older, and thus the younger persons estate would inherit everything.

The new provision in WESA is designed to ensure the default joint tenant’s perish in a common disaster, their respective estate should benefit from their shares in the jointly held property rather than the estate of only the youngest of the joint tenants.

This is also what is meant by rights to property will be determined as if each deceased person survive the other or others.

It is also a requirement of section 10 WESA that there is a mandatory five-day survival rule in order to inherit.

S 10 (1) WESA states that a person who does not survive a deceased person by five days, or longer period provided in an instrument, is conclusively deemed to have died before the deceased person for all purposes affecting the estate of the deceased person or property of which the deceased person was competent to give by will to another.

(2) if two or more persons hold property as joint tenants, or hold a joint account,

a) in the case of two persons, it cannot be established that one of them survive the other by five days,

1) one half of the property passes as if the person survive the other person by five days, and

2) one half of the property passes as if the other person referred to in subparagraph one had survived the first person referred to in subparagraph 1 x 5 days,

b) in the case of more than two persons, cannot be established that at least one of them survive the other by five days, the property must be divided into as many equal shares as there are joint tenants or persons holding the joint account, and the shares must be distributed respectively to those persons who would have been entitled to a share in the event that each of the person said survived.

Under the Interpretation act, to calculate five days one excludes the first day and includes the last day.

Wills Variation Explained

Wills Variation Explained | Disinherited

JR v JDM 2016 BCSC 2265 explained the criteria in assessing a wills variation claim.

[81] The key provision of the WVA is s. 2 ( now Section 60 WESA) . That section provides that if, in the Court’s opinion, a will fails to make adequate provision for the proper maintenance and support of the testator’s spouse or children, the Court is empowered, in its discretion, to vary the will to make provision that it considers adequate, just and equitable in the circumstances.

[82] Tataryn v. Tataryn Estate, [1994] 2 S.C.R. 807, is the governing authority in British Columbia on the WVA. McLachlin J., as she then was, writing for the Court, articulated the relevant considerations and principles that animate the application of the WVA. The fundamental approach is anchored in her observation that “[t]he search is for contemporary justice”: Tataryn, at 815. The courts must read the WVA “in light of modem values and expectations” and “are not necessarily bound by the views and awards made in earlier times”: Tataryn, at 814-815.

[83] The Court in Tataryn stated that the determination of whether a will makes adequate provision and, if not, what provision would be adequate, just and equitable, are “two sides of the same coin”: Tataryn, at 814.

[84] The primary statutory objective of the WVA is the adequate, just, and equitable provision for a testator’s spouse and children. As identified in Tataryn, the other protected interest is testamentary autonomy. However, testamentary freedom must yield to the extent required to achieve adequate, just, and equitable provision for the applicant spouse and/or children. In that sense and to that degree only, testamentary autonomy will be curtailed by the application of the WVA: McBride v. Voth, 2010 BCSC 443 at para. 125. The Court of Appeal in Chan v. Lee (Estate), 2004 BCCA 644 at para. 43 affirmed that courts should not approach the WVA as a means “to right all the perceived wrongs of the past” or “to improve upon the degree of fairness of a will” if the testator has met his obligations under the WVA.

[85] In addressing the adequacy of the testamentary provision, Madam Justice McLachlin clarified that the question of whether a testator has acted as a judicious parent or spouse is measured by an objective standard, assessed in light of current societal legal norms and moral norms. As outlined in Tataryn, legal norms are the obligations that the law would impose upon the testator during his or her life if the question of provision for a claimant’s spouse or child were to arise. A testator’s moral duties are grounded in “society’s reasonable expectations of what a judicious person would do in the circumstances, by reference to contemporary community standards”: Tataryn, at 820-821.

[86] The concept of adequate provision is a flexible notion which turns on the particular circumstances of the case: Dunsdon v. Dunsdon, 2012 BCSC 1274, at para. 131. Tataryn expressly acknowledged that moral duties are more susceptible to being viewed differently by different people because there is no clear legal standard by which to judge such duties: Tataryn, at 822. However, the analysis in Tataryn underscores that the court must apply an approach that accords with a contemporary view of marital and parental obligations.

[87] The Court in Tataryn recognized that the foregoing assessment necessarily involved the balancing of competing claims, and held that where the size of the estate permits, all moral and legal claims should be satisfied. Where prioritization is necessary, generally, claims that would have been recognized as legal obligations during a testator’s lifetime take precedence over moral claims. The court must also weigh the competing moral claims and assign each its priority according to their relative strength: Tataryn, at 823. The Court recognized that such an analysis would produce a range of options for the distribution of assets which might be considered appropriate in the circumstances. The court should only make an order to vary a will where the testator’s chosen distribution falls outside of this range.

[88] The jurisprudence also establishes that in determining whether the will-maker has fulfilled his or her obligations, the court may consider gifts made outside the will. If a will-maker has made inter vivos gifts to individuals other than the claimant or has arranged his affairs to facilitate a passing of assets to such individuals outside the framework of the will, the moral duty to a claimant may be intensified: Wong v. Soo, 2015 BCSC 1741. Conversely and depending on the circumstances, a will-maker’s moral duty may be diminished or negated entirely where he or she has made gifts to a claimant either before death or in consequence of it: Dundson at para. 185; Doucette at para. 84.

[89] The legislated scheme of intestate succession does not serve as a guidepost in determining whether adequate provision has been made under the WVA: Wilson at para. 379; Hall v. Korejwo, 2011 BCCA 355 at para. 46.

[90] In reference to the moral claim of independent adult children, the Court in Tataryn observed that while they “may be more tenuous” than that of a spouse or dependent child, some provision for adult independent children should be made if the size of the estate permits and in the absence of circumstances that would negate the existence of such an obligation: Tataryn,
at 822-823.

[91 ] In Dunsdon Madam Justice Ballance conveniently summarized the considerations that inform the existence and strength of a testator’s moral duty to independent children:

[134] In the posi-Tataryn era, the following considerations have been accepted as informing the existence and strength of a testator’s moral duty to independent children:

  • relationship between the testator and claimant, including abandonment, neglect and estrangement by one or the other;
  • size of the estate;
  • contributions by the claimant;
  • reasonably held expectations of the claimant;
  • standard of living of the testator and claimant;
  • gifts and benefits made by the testator outside the will;
  • testator’s reasons for disinheriting;
  • financial need and other personal circumstances, including disability, of the claimant;
  • misconduct or poor character of the claimant;
  • competing claimants and other beneficiaries:

(See Clucas v. Clucas Estate, [1999] B.C.J. No. 436; McBride v. McBride Estate, 2010 BCSC 443; Yee v. Yu, 2010 BCSC 1464; Wilson v. Lougheed, 2010 BCSC 1868)

[92] In assessing the strength of the legal and moral obligations owed by a testator to a second
spouse, the court will consider factors such as:

(a) The length of the marriage;
(b) When and how the testator’s assets were acquired;
(c) The contribution of the second spouse;
(d) How family assets would be divided under the applicable family legislation upon marriage breakdown;
(e) Competing obligations with the children from the first marriage;
(f) Financial circumstances of the spouse;
(g) The size of the estate; and
(h) The magnitude of assets passing to the spouse outside of the estate in consequence
of other pre-death transactions undertaken by the testator.

[See Wongv. Soo, 2015 BCSC 1741 at paras. 73-82; Saugestad v. Saugestad, 2006 BCSC 1839, varied on different grounds 2008 BCCA 38; Mawdsley v. Meshen, 2010 BCSC 1099, affirmed 2012 BCCA 91; Ciarniello v. James 2016 BCSC 1699]

S.58 WESA Refused to Cure Defective Will

Poulk Estate 2018 BCSC 1321 is a good review of the law relating to section 58 of WESA and after a review of the facts and law, found that the said curative provisions of section 58 could not be applied.

The deceased was admitted to hospital where he underwent surgery for bowel obstruction where it was discovered he had bowel cancer and he died days later.

The deceased had only one child, the applicant daughter and he was not married at the time of his death.

The deceased had distanced himself from his daughter after separating from her mother when she was less than one year old.

The daughter had attempted to re establish contact with the deceased when she was 16 years old but the relationship did not develop, and at the time of his death the deceased and his daughter had little contact with each other.

A will was drafted following the surgery and it purported to leave the deceased’s estate to his four siblings in equal shares. The will was not drafted by the deceased and it was not signed by him prior to his death.

The daughter sought an order under section 58 WESA seeking determination of whether the will represented the intention of the deceased.

The will was a fill in the blanks form that was not completed by the deceased.

It was not disputed that the will did not meet the requirements of validity as set out in section 37 of WESA.

The will was not completed by the deceased and it was inferred that it was completed by his sister, the will was not signed by the deceased, and there was nothing on the face of the will to indicate the deceased knew and approved of the contents of the will.

Absence of any objective evidence that the deceased knew and approved the contents of the will was particularly concerning is the will was drafted by one of the beneficiaries and was not consistent with previously expressed intentions of the deceased.

The deceased long time friend opposed the deceased was told by him that he was going to will everything to his daughter.

Notes of the social worker in the hospital were troubling to the court, as they suggested that it was the family of the deceased who are focused on preparing the will, rather than the deceased himself, and that the deceased wanted some time to think. Even if there was sufficient evidence to establish the deceased knew and approved the contents of the will, it was far from clear that the will was fixed and final as to the expression of the deceased testamentary intention. It was clear that the deceased might not have appreciated the severity of his illness or imminence of his death.

The will departed from the requirements for validity in section 37 of WESA to a significant degree, and the evidence fell far short of establishing that the will was final and authentic.

On the balance of probabilities, the court found that the will did not represent a deliberate and final expression of the deceased testamentary intentions, and refused to invoke the provisions of section 58 WESA “to cure“ any deficiency.

The court followed the leading case in British Columbia Re Young 2015 BCSC 182 at paragraph 17:

“S 58 is a curative provision. It confers a discretion on the court to relieve against the consequences of noncompliance with testamentary formalities in the record, document or writing or marking on a will or document”. And prescribed circumstances, section 58 permits the court to address and cure issues of formal invalidity in such documents. It cannot, however, be used to uphold the will that is invalid for substandard reasons such as testamentary incapacity or undue influence.

The court also referred to Re Lane estate 2015 BCSC were the court summarized the principles from the Manitoba decision George v Daily that has largely been followed in British Columbia in decision such as Re Young.

1) The standard of proof on an application under the curative provision is proof on a balance of probabilities
2) the greater the departure from the requirements of formal validity, the harder it may be for the court to be satisfied that the document represents the deceased testamentary intention;
3) the requirements for formal validity of a will serve several purposes or functions, including an evidentiary function by providing the court with reliable and permanent evidence of testamentary intention and the terms of the will; and a cautionary function by impressing upon the testator the solemnity, finality, and importance of his actions in making his last will and testament the evidentiary and cautionary functions are particularly relevant to the determination of whether or not our writing or document embodies the testamentary intentions of the deceased not every expression made by a person, whether orally in writing, concerning the disposition of  his or her property on death embodies his or her testamentary intentions

The court held at paragraph 65:

The term “testamentary intention” means much more than a person’s expression of how he would like his or her property to be disposed of after death. The essential quality of the terms that there must be a deliberate or fixed and final expression of intention as to the disposal of his or her property on death Bennett v Molinary v Winfrey (1961) SCR 91

S.151 WESA: Leave to Commence a Court Action on Behalf of the Executor

S.151 WESA: Leave to Commence a Court Action on Behalf of Executor

Re Gordon Estate 2018 BCSC 487 is a decision that granted leave under section 151 of WESA for the residual beneficiary, the University of British Columbia, to commence an action in the name and on behalf of the executor of the estate of the deceased.

The University of British Columbia was the sole residual beneficiary under the deceased will, however prior to her death, the deceased transferred the majority of her assets to her gardener which totaled almost $2 million.

There was very little in the way of assets left in the estate for the residual beneficiary.

The petition and supporting materials filed by the University of British Columbia showed that the deceased was basically blind due to macular degeneration and was cognitively deficient.

the deceased’s long time lawyer refused to change her will and prepare a transfer of her home on the basis that she was confused, and believed amongst other things that she owned two houses when in fact she only owned one.

The court granted relief pursuant to section 151 of WESA are to allow the University of British Columbia to bring action in the place of the executor, to set aside the transfer of assets done prior to her death so as to bring them into her estate, so that the University could inherit them.

Section 151 of WESA states as follows:

151 (1) despite section 136, a beneficiary or an intestate successor may, with leave of the court, commence proceedings in the name and on behalf of the personal representative of the deceased person

a) to recover property were to enforce a right, duty or obligation owed to the deceased person that could be recovered or enforced by the personal representative, or
b) the court may grant leave under this section if:
a) the court determines the beneficiary or intestate successor seeking leave
1) has made reasonable efforts to cause the personal representative to commence or defend the proceeding,
2) has given notice of the application for leave to
a) the personal representative
b) any other beneficiaries or intestate successors and c) is acting in good faith, and
3) it appears to the court that it is necessary or expedient for the protection of the estate or the interests of the beneficiary or an intestate successor for the proceeding to be broader defended

4) on application by a beneficiary, and intestate successor or personal representative, the court may authorize a person to control the conduct of a proceeding under this section or may give other directions for the conduct of the proceeding.

The court considered the decision Bunn v Bunn 2016 BCSC 2146 were the court refused an application by a beneficiary, the daughter of the deceased, seeking leave to bring an action in the name and on behalf of the executor against the applicant’s brother and one of his companies. The proposed action would’ve challenge certain inter vivos transactions as having been the conduct of undue influence, or alternatively based on the doctrine of non-test factum.

In the Bunn decision, the court held that the terms necessary and expedient or disjunctive, such that the applicant need only establish that the proposed action is either necessary or expedient. A proposed proceeding will be considered necessary if the personal representative is unwilling or unable to proceed. It may be expedient if it’s in the best interest of the estate.

The court gave great weight to the lawyer who declined to act for the deceased because of her ongoing lack of capacity, and that he had a long-standing relationship with her. The lawyer who actually prepared the transfer of assets, did not provide an affidavit himself, and his handwritten notes of his one and only conversation with the deceased sis not elucidate his practice in interviewing persons in the deceased situation. There was no description of the specific questions he asked of the specific answers the deceased gave to support his apparent conclusion that the deceased was able to” tell me about her assets”.

S.46 WESA: Priorities of Distribution When Gifts Fail

S.46 WESA: Priorities of Distribution When Gifts Fail | Disinherited

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

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

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

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

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

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

Section 42 WESA states:

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

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

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

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

S.46 WESA states:

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

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

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

S 46(2) states:

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

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

Admissible Extrinsic Evidence In S. 58 WESA Applications

Admissible Extrinsic Evidence in S. 58 WESA Applications | Disinherited

Admissible extrinsic evidence in S 58 WESA applications to “ cure” defective wills was discussed in Re Mace Estate 2018 BCSC 1284.

In short, the ordinary rules of admissibility apply.

Ordinarily, evidence must be relevant to a live issue and not be subject to exclusion under any other rule of law or policy to be admissible.

Relevance must therefore be assessed on a case-by-case basis , as set out in Regina v White 2011 SCC 13:

“In order for evidence to satisfy the standard of relevance, it must have some tendency is a matter of logic and human experience to make the proposition for which it is advanced, more likely than that proposition would be in the absence of that evidence”.

Under section 58 WESA inquiries to determine, on a balance of probabilities, whether a noncompliant document embodies the deceased testamentary intentions at whatever time is material. The task is inherently challenging because the person best able to speak to these intentions, namely the deceased is not available to testify.

In addition, by their nature, the source of documents being assessed will likely not have been created with legal assistance. Given this context, and subject to the ordinary rules of evidence, the court will benefit from learning as much as possible about all that could illuminate the deceased state of mind, understanding and intention regarding the document.

Accordingly, extrinsic evidence of testamentary intent is admissible on the inquiry –Langseth estate v Gardiner (19990) 75 DLR (4th) 25 at 33 ( Man. CA)

The case authorities discuss that the extrinsic evidence may include events that occurred before, when and after the document was created – the key issue in an application under section 58 is whether, on the balance of probabilities, the item placed before the court, the record or document or writing or marking on a will or document, was intended to have testamentary effect: that is, does it represent the deliberate or fixed and final expression of intention of the material time as to the to the disposal of the will maker’s property on death? The role of the court on an application under section 58 is not to determine the validity of the instrument per se, or the validity of the gifts contained within it, but determine whether the instrument represents the deceased testamentary intention- Re Smith Estate 2016 BCSC 350.

The BC Court of Appeal decision in Re Hadley Estate 2017 BCCA 311 confirm that section 58 of WESA does not require a basic level of compliance with the formalities of making a will. The consideration of the court is whether the document represents the testamentary intentions of its maker. The material time for determining these intentions will in many cases be the time at which the will was made. However, a document may acquire a testamentary character by subsequent and sufficient manifestation of the will maker’s intention.

In addition to the language of the document, extrinsic evidence of testamentary intent is admissible on the inquiry, such as the circumstances surrounding its creation and direct statements of the deceased. Such evidence benefits. The court, since the person who made the document will no longer be available to testify, and often the document will not have been made with the assistance of counsel.

The most common situation in which an application fails is where the court is simply not satisfied that the propounded document or record contains the will maker’s final thoughts are intentions with respect to the will or its alteration, revocation or revival, but is just a draft are some preliminary notes that are subject to change. As one court as put it, the curative provisions allow the court to overlook the formal requirements of the act, but not to speculate on the testamentary intentions of the deceased – Re Archer Estate 2005 SKQB 118 at para. 9

25 Will Drafting Tips

25 Tips for Drafting a Will | Disinherited Estate Litigation Vancouver

1. Take your time. Be cautious. Seriously consider charging your actual time on a Wills file. If your client objects, then educate the client about the amount of time needed to prepare a Will so as to ensure that the client’s lifetime accumulated wealth will pass to his or her chosen heirs.

2. When the Will is ready for execution, read it through a number of different times, each time assuming a different scenario involving contingencies relevant to the Will.

3. Do not be a dabbler. If you do not routinely draw Wills, then consider not doing them at all.

4. Use a checklist when taking instructions. The Law Society Practice Checklist Manuals are an excellent start, and can be modified to suit you . I always use it when I cross-examine a lawyer or Notary. It usually makes them look incompetent if they have not followed a checklist.

5. Get all the necessary information about your client’s personal circumstances , including special situations such as a disabled child. It is essential to obtain complete information about the client’s estate, including details about the nature in value of each asset, its location, and how it is registered.

6. Review copies of earlier Wills, insurance policies, separation agreements, marriage contracts, or any other documents that may affect the client’s estate.

7. Take the necessary time to satisfy your responsibility to ensure that the client understands what the Will says, what it means, and that the client approves its contents. It is essential to go through the Will clause by clause with the client. The lawyer should attend upon the client to make sure that the Will is properly executed. If this is not possible, the lawyer has a duty to make sure that when the original of the Will is sent out for signature, it is accompanied with a very clear letter of instructions on how to execute the Will. You have a further obligation to subsequently ensure that the Will is in fact executed and is put in safekeeping.

8. It is essential to keep very careful notes of Will’s instructions and all communications with Will’s clients. If there is a mistake or an ambiguity and the drafting, it may be these notes that will determine the construction that the court will put on the Will. Notes are especially crucial if there are any unusual circumstances surrounding the Will. A few examples of this might include elderly or infirm testators, blindness or deafness, poor language skills, deathbed Wills, or testators whose Wills might be subject to challenge all the basis of undue influence or lack of capacity.

9. Utilize good legal assistants, but do not place too much reliance on them. Ultimately you cannot delegate your own responsibility to ensure that the Will are prepared correctly.

10. Always file a Wills Notice with the Division of Vital Statistics. Although it is not mandatory, you should do so, particularly in light of the development of liability in favour of disappointed beneficiaries.

11. Maintain a Wills index with the name and address of the testator, the filing number of the Will file, the name of the executor, the date of execution of the Will, and the Will’s location.

12. Deliver a final letter to the client confirming the location of the Will, the date that it was signed, and reminding the client to review the Will from time to time. It is also essential to make the client aware that marriage revokes the Will and that divorce may affect the validity of some of the provisions of the Will.

13. Probe the testator’s mind to ensure that there is sufficient mental capacity to prepare a Will. If there is any doubt, a medical opinion should be obtained.

14. Always take instructions in the absence of potential beneficiaries or executors.

15. Record detailed reasons why any person who would be an appropriate object of the testator’s bounty is being omitted from the Will, and then consider the preparation of a detailed memorandum to the Will in conjunction with your notes.

16. Try not do codicils. It is too easy to make a mistake.

17. Do not use the words issue, per stirpes, per capita. instead use common words that everyone understands such as children and grandchildren

18. If a charity is a beneficiary in a Will, then it is imperative to do two things:

(i) understand the structure of the charity, and obtain the testator’s instructions on which part of the charity her or she wishes to benefit; and

(ii) ensure that the name of the charity is correct. The easiest way of understanding the structure of the charity and finding out its proper name is to telephone the charitable organization and explain your inquiry relates to a gift made by Will, and to speak with a person authorized to give you the information. See also each year’s Canadian Donor’s Guide for assistance. Make sure the charity is permitted by Revenue Canada to issue a tax receipt as a recognized charity.

19. Only sign one original, and make it clear that a copy is, in fact, a copy.

20. Use memorandums to explain why certain beneficiaries are not being provided for, such as in a Wills Variation situation. Set out the reasons in detail, and try to ensure that the reasons set out are factually accurate, and not merely vindictive and mean spirited.

21. Do not under any circumstances attempt to prepare a Will that is “over your head” or that you should not be preparing due to restrictions on your practice, i.e., Notaries doing Wills with discretionary trust provisions. “If in doubt, refer it out” should be your motto.

22. Try to use percentages, rather than specific amounts when drafting bequests to various beneficiaries and ensure that the percentages add up to 100.

23. Ensure that the executors have sufficient powers to carry out their job. For example, if the testator has a business, then include powers to operate the business, such as the power to order inventory. Otherwise the trustee may only be able to operate the business much like a receiver, unless appointed special powers by the court, on application.

24. Do not include an RRSP designation clause, or revocation of an RRSP clause in a Will.

25. Stress to clients that wills are the corner stone of basic estate planning, should be taken seriously, reviewed from time to time and kept in a safe place such a safety deposit box and registered with a filed wills notice

Executor/Trustee Removal: The Law Summarized

Executor/Trustee Removal: The Law Summarized

1. Feeney’s The Canadian Law of Wills, 4th ed. (Markham: LexisNexis, 2000) at 8.17 states:

An executor has a duty to settle the affairs of the estate and to distribute in accordance with the terms of the Will. A power granted to an executor exists within the context of the executor’s duty to settle the affairs of the estate and to distribute.

2. A power to retain an asset does not override the executor’s duty to settle the affairs of the estate and to distribute, per Justice Middleton in Sievert, Re (1921), 67 D.L.R. 199 (Ont. C.A.) at p. 200.

3. In Ketcham v. Walton 2012 BCSC 175 at para. 10, Mr. Justice Wong stated: “The basic principle of an executor’s duty to specified potential beneficiaries of the will is neutrality.” He quoted Mr. Justice Bouck in Quirico v. Pepper Estate (1999) 22 BCTC 82 (BCSC) at para. 15, as follows:

The primary duty of an executor is to preserve the assets of the estate, pay the debts and distribute the balance to the beneficiaries entitled under the will, or in accordance with any other order made under the Wills Variation Act. An executor should not pick sides between the beneficiaries and use estate funds to finance litigation on their behalf under the Wills Variation Act. It is a matter of indifference to the executor as to how the estate should be divided. He or she need only comply with the terms of the will or any variation of it made by a court.

4. The statutory authority to remove a trustee and appoint a replacement for that trustee is set out in ss. 30 and 31 of the Trustee Act, R.S.B.C. 1996, c. 464:

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

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

5. In Miles v. Vince, 2014 BCCA 289 at paras. 84-85, Madam Justice Levine, for the Court, considered the bases upon which a court might remove a trustee, as follows:

[84] What circumstances justify the removal of a trustee? In Letterstedt v. Broers (1884), L.R. App. Cas. 371 (J.C.P.C.), the court established guidelines justifying the removal of a trustee (at 385-389):

“1. If the Court is satisfied that the continuance of the trustee would prevent the trusts being properly executed, the trustee might be removed. It must always be borne in mind that trustees exist for the benefit of those to whom the creator of the trust has given the trust estate.

2. The acts or omissions must be such as to endanger the trust property or to show a want of honesty, or a want of proper capacity to execute the duties, or a want of reasonable fidelity.

3. In exercising the delicate jurisdiction of removing trustees, the Court’s main guide must be the welfare of the beneficiaries. It is not possible to lay down any more definite rule in a matter that is so “essentially dependent on details often of great nicety.” The Court must proceed to look carefully into the circumstances of the case.

4. Where a trustee is asked to resign, and if it appears clear that the continuance of the trustee would be detrimental to the execution of the trusts, even if for no other reason than that human infirmity would prevent those beneficially interested, or those who act for them, from working in harmony with the trustee, and if there is no reason to the contrary from the intentions of the framer of the trust to give this trustee a benefit or otherwise, the trustee is always advised by his own counsel to resign.”

6. In deciding whether to remove an estate trustee, “the court’s main guide should be the welfare of the beneficiaries”: see Crawford v. Jardine, [1997] O.J. No. 5041 (Ont. Ct. (Gen. Div.)), citing Letterstedt v. Broers, ibid, at 385-387, and Anderson, Re, (1928), 35 O.W.N. 7 at 8 (Ont. H.C.).

7. A court may intervene by removing a trustee where it finds that the conduct of the named trustees has endangered the trust property, or has shown a want of honesty, or of proper capacity to execute the duties of the office, or of reasonable fidelity (Conroy v. Stokes, [1952] 4 D.L.R. 124).

8. An executor may be removed where the executor’s actions are not in the best interests of the beneficiaries (McKay v. Howlett et at, 2003 BCCA 555).

9. An executor may be removed where the executor’s duties are found to be in conflict with his or her personal interests or estate assets had been endangered by the executor’s conduct and the executor had benefitted at the expense of the estate (Hall v. Hall, (1983) 45 B.C.L.R. 154 (S.C.); Veitch Estate, 2007 BCSC 952).

10. Even in the absence of misconduct, a trustee may be removed by the Court where the proper administration of a trust is threatened, and where the trustee in question has shown a want of proper capacity to execute the duties. (Re: Consiglio Trusts (No. 1) [1973] 3 O.R. 326; Letterstedt v. Broers, ibid; Conroy v. Stokes, ibid).

11. The principles to be applied in applications for the removal of executors are the same as for those for removal of trustees. (Powers v. Powers Estate, [1988] N.J. No. 19 (S.C.N.T.D.)).

12. A trustee may be removed if he or she fails to communicate promptly with trust beneficiaries or fails to file trust tax returns (Loftus v. Clarke Estate, 2001 BCSC 1136); or if there is a concern that the trustee has not made a proper accounting of business that he or she had conducted on behalf of the trust or evidence that he or she was treating the assets of the trust as his or her own personal assets (Hayne v. Moncrieff, 2012 ABCA 264).

13. In matters involving an executor’s misconduct the beneficiary may obtain an award of special costs against him or her (Loftus v, Clarke Estate, ibid).

14. “Even a ‘perceived’ conflict of interest between an executor’s personal interests and her duty to act in the interests of the beneficiaries of the will can be sufficient to warrant her removal.” Yeh Estate (Re), 2016 BCSC 1550 at para. 17, quoting Ching Estate (Re), 2016 BCSC 1111, at para. 22.

15. In Re Becker (1986), 1986 CanLII 2596 (ON SC), 57 O.R. (2d) 495 (Ont. S.C.), (sub nom. Stadelmier v. Hoffman), the Court found the executor should be passed over because there was a conflict as a result of the fact the executor could not attack the gift and transfer of properties to him while at the same time maintaining in his personal capacity that the transfers were proper. The court summarized the findings at 500:

In considering the fitness of the respondent to act as an executor I have considered also the duties of an executor in a general way. One duty of an executor is to bring in the estate for distribution among the beneficiaries. If it is perceived, on good grounds, that that important duty is compromised by a personal conflict of interest because the executor will be asked to sue himself to recover what may be a large part of the estate property, he must be passed over. That consideration is particularly important when the action against the executor is for a very significant amount in respect to the size of the estate.

BC Lawyer- Varying a Will- Will Variation and Second Marriages

Wills Variation (S 60 WESA) and the Second Spouse

Trevor todd and Jackson Todd have practiced in contested estates for over sixty combined years, including varying wills relating to second marriages.

 

In Unger v Unger Estate 2017 BCSC 1946 the court considered the legal and moral claims of a long time second spouse against the estate of her late husband who did not provide for her in his will.

The plaintiff Mr. Unger aged 80 was married to the deceased for 32 years. It was a second marriage for both.

The surviving spouse moved into the home of the deceased after the death of her first husband. At the request of the plaintiff the deceased made no claim against her first husband’s estate. She entered the second marriage with Mr. Unger was no assets and did not work outside of the home.

The deceased purchased the matrimonial home in 1981. It was originally held in joint tenancy, but was severed in 1993 after the plaintiff and the deceased briefly separated for a few months. It remained in tenancy in common until his death.

The plaintiff suffered physical and emotional abuse at the hands of the deceased, and at one point the deceased was convicted of assault and placed on probation. During their retirement years the couple lived in the matrimonial home and both of them provided services to maintain and enhance the property

After 2010 the plaintiff suffered a series of health issues including mini strokes.

In 2013 the deceased due to his suffering from dementia was placed in an assisted care facility, and the plaintiff visited him daily and was present when he passed away that same year.

The defendants were the deceased four adult children from his first marriage.

His will left $20,000 each to his two daughters and the residue to be divided amongst all four children.

No provision was made for the plaintiff and the reasons stated in the will was that the deceased had transferred title to her of 50% of the matrimonial home during his lifetime.

The defendants had been financially independent of their father for many years, although one of the daughters was very ill, and lived on minimal government assistance. Another daughter earned a low hourly rate and lived with her husband in a trailer.

The value of the estate, including the matrimonial home was $609,000, not including a $100,000 account of the deceased held jointly with his second daughter.

The court varied the will in favor of the surviving widow, holding that the deceased purported rationale for excluding the plaintiff from the will was not valid.

The court found that the legal and moral obligations owed to the plaintiff or high was from a legal obligation and she was his partner for 34 years, and remained with him despite his abusive conduct towards her. She looked after him to the best of her abilities and remained by his side until his death. As such, she was also owed a moral obligation as well as a legal obligation by the deceased to be provided for.

The court awarded her 30% of the residue of the estate, with the remaining 70% to be equally distributed amongst his four children. She also kept her one half of the house that her late husband transferred to her.

The Law

Legal obligation

The court relied heavily on the applicable family law legislation, the Family Law act that came into force in March 18, 2013.

Under section 81(b) of that act, each spouse is entitled to an undivided half interest in all family property, which includes all property owned by at least one spouse as well as beneficial interests of at least one spouse.

However, excluded from the family properties amongst other things, any property acquired by a spouse before the relationship began, and any property derived from such property or disposition of such property S 85 (1)

The evidence was that the plaintiff did not provide any initial consideration in exchange for being put on title to the matrimonial home previously owned solely by the husband. The evidence supported that Mr. Unger intended to transfer the property to the plaintiff as a gift.

The court held that the transfer of the one half interest in the matrimonial home to the plaintiff was a gift, and satisfied the deceased’s legal obligations to her.

Moral obligation

The court referred to the decision JR v. JDM 2016 BCSC 2265 in setting out the factors to consider in assessing the moral claim in a second marriage

1) the length of the marriage;

2) when and how the testator’s assets were acquired;

3) the contribution of the second spouse;

4) how family assets would be divided under the applicable family legislation upon marriage breakdown;

5) competing obligations with the children from the first marriage;

6) financial circumstances of the spouse;

7) the size of the estate; and

8) the magnitude of assets passing to the spouse outside of the estate, in consequence of other pre death transactions undertaken by the testator

The moral obligation of a testator in the second marriage was considered in the decision Suagestad v Saugestad 2006 BCSC 1839, where the court gave a more limited moral claim of a second wife for the bulk of the testator’s estate was acquired during a first marriage

The decision

The court found that the deceased fail to discharge his legal and moral obligation owed to his wife when he provided with nothing under his will.

The plaintiff was allowed to keep her own one half of the matrimonial home, and was awarded 30% of the residue the estate, with the remaining 70% to be equally divided between the four children.