Trevor Todd has contested wills successfully alleging undue influence for 50 years
Davy v Davy 2019 BCSC 1826 reviewed the law relating to claims of undue influence and the implications of legal advice both given or not provided.
The deceased suffered from dementia and was living with one caretaker son and ultimate joint tenant with his mother of her major asset, her home.
The son sat in on meetings with the lawyer and was treated as a client- the lawyers file was opened in both the son and the mother’s name and the lawyer wrote both of them and rendered her account to both of them for the property transfer and a bill to just the mother for her will.
The court concluded that the legal advice provided to the deceased by the lawyer did not offer an assurance that the transfer of the home into joint tenancy was intended by the deceased as a result of her own full, free and informed thought.
There was no independent legal advice and she likely lacked the mental capacity to enter into the transactions.
The court held that the son held the joint tenancy property in trust for the estate and under her will the estate was divided equally amongst the four children.
There was a potential for domination by the son over the deceased which gave rise to a presumption of undue influence in inter vivos transfers.
The fact that a transfer or received legal advice is always relevant to an assessment of the transfers intentions, but the significance of the advice depends on various considerations.
In Cowper-Smith 2016 BCCA 200 at para 51 , the court approved the following list of considerations for evaluating the significance of legal advice received in assessing the claim of undue influence:
- Whether the party benefiting from the transaction is also present at the time the advice is given and/or at the time the documents are executed;
- Whether, though technically acting for the grantor, the lawyer was engaged by and took instructions from the person alleged to be exercising the influence;
- In a situation where the proposed transaction involves the transfer of all or substantially all of a person’s assets, whether the lawyer was aware of that fact, and discuss the financial implications with the grantor;
- Whether the lawyer enquired as to whether the donor or discuss the proposed transaction with other family members who might otherwise have benefited if the transaction did not take place; and
- Whether the solicitor discussed other options, whereby he or she could achieve his or her objective with less risk to him or her.
The case law establishes that where there is a possibility of undue influence, effective independent legal advice requires that the lawyer must not confine himself or herself to confirming the clients understanding of the legal mechanics and voluntary assent to the transaction,
In Cowper-Smith held that these cases in which an independent legal advisor should be “ satisfied that the gift is one that is right and proper, and all of the circumstances of the case, and if he or she cannot so satisfy himself or herself, then he or she should advise his or her client not to proceed”
Assessing the adequacy of the legal advice given is a fact specific inquiry. It does not reduce to any precise test. In some circumstances, it may require advice on only the nature and consequences of the transaction.
However, where concerns are allegations of undue influence arise, generally, there will be a need to give informed advice and the merits of the transaction.
The jurisprudence emphasizes that the lawyer’s duty to ensure that his or her client understands and freely assents to the transaction at hand, sometimes requires the lawyer to go well beyond an explanation of the narrow legalities to an assessment of the clients understanding of the substance of the transaction and its implications. This broader duty is engaged where it should appear to the lawyer, on the facts presented to him or her, that there is a real possibility of undue influence.