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Will Drafters File Privileged In Wills Variation Cases

privileged in wvaPlaintiff’s counsel invariably want to obtain and review the will drafters file in wills variation, but in wills variation cases the lawyer’s file is usually privileged,  confidential and not compellable , ( but not so when the validity of the will itself is in question.

Chang v Lai Estate 2014 BCSC 128 involved 3 daughters of the deceased and residuary beneficiaries of their mother`s estate, consulted with lawyer T re probating the will.

Unhappy with the will`s provisions however, the same 3 sisters also obtained advice from the same lawyer T re a wills variation action.

Some time later, the plaintiffs renounced their positions as executors and commenced a wills variation action.

The defendants  claimed a right to review the lawyer T`s entire  file .

Justice Bruce held that the defendants were only entitled to that portion of the file concerning the administration of the estate ( ie the assets, debts and proposed distribution ) and not any portion of the file relating to the advice given on the  variation of the will, it being privileged.

 

DECISION

[16]         It is well established that a beneficiary has a proprietary interest in and a right to production of any document relating to advice sought and obtained by an executrix or trustee in connection with the administration of an estate. The executrix cannot claim solicitor-client privilege over such documents because they have a commonality of interest with the beneficiaries in the administration of the estate. The advice taken by the executrix is for the benefit of all beneficiaries under the will. There is no need to protect solicitor-client communications from disclosure because the beneficiaries and the executrix have a joint interest in the advice: Re Ballard Estate at p. 354. The same principle applies to legal opinions the executrix obtains regarding the proper administration of the estate. No solicitor-client privilege applies because the legal opinion sought by the executrix was to further the interests of the beneficiaries under the will: Re Ballard Estate  1994 20 O.R.(3d) 350at p. 354.

[17]         The beneficiary is not, however, entitled to production of all communications between legal counsel and the executrix. Where there is an adversarial relationship between a trustee and a beneficiary, there is no “joint interest” that compels disclosure of communications that would normally be protected by solicitor-client privilege. As Lederman J. says in Re Ballard Estate at p. 354:

… there is no need to protect the solicitor-client communication from disclosure to those very persons who are claiming under the estate. The communications remain privileged as against third parties who are strangers or are in conflict with the estate, but as was stated in Stewart v. Walker, supra, not those who are claiming under the estate. And that is because the trustee and beneficiary have a joint interest…

[18]         The requirement for a joint or commonality of interest was recognized in MacPherson 2005 BCSC 207, where Humphries J. says at para. 18:

Both sides cited cases which stand for the same basic proposition:  A beneficiary has a proprietary interest in and is entitled to production of documents relating to advice sought and obtained by a trustee in connection with the administration or management of, for instance, a pension plan, or an estate (see Froese v. Montreal Trust Co. of Canada [1993] B.C.J. No. 1529 (S.C.), aff’d [1993] B.C.J. No. 1847 (C.A.); Re Ballard Estate [1994] O.J. No. 2281 (Gen. Div.); Cooke et al v. Canada Trust  (Van. Reg. No. S011763, October 22, 2004; leave to appeal granted); Merritt v. Imasco Enterprise Inc. [1992] B.C.J. No. 2011; Thomas v. Secretary of State for India in Council (1870) 18 W.R. 312 (Ch.)), but not to documents that arise in the course of an adversarial relationship between the trustee and beneficiary.

[19]         There are clearly conflicting principles in this case. On the one hand, it is of the utmost importance to protect solicitor-client communications from disclosure. The law has consistently upheld the confidential nature of such communications and strictly construed the circumstances that may be regarded as an implicit waiver of the privilege. On the other hand, the beneficiaries of a trust are entitled to production of documents that fall broadly within the category of administration of the estate.

[20]         Balancing these conflicting principles, I find that the issue in this case must be resolved in favour of the plaintiffs. The underlying basis for exempting from solicitor-client privilege those documents that relate to advice sought in connection with the administration of the estate is the joint or common interest of the trustee and the beneficiary. It follows that where the beneficiary is in an adversarial relationship with the executrix, solicitor-client privilege remains in place to preserve the confidentiality of those communications. In this case the defendants do not have a common or joint interest with the plaintiffs regarding the wills variation action. Their interests are clearly in conflict due to the variation of the will sought by the plaintiffs. Thus legal advice sought and received for that purpose remains privileged.

[21]         Furthermore, the fact that the plaintiffs retained the same legal counsel to act for them in regard to the wills variation action and the administration of the estate does not amount to a waiver of solicitor-client privilege. Regardless of whether Mr. Takahashi was in a conflict of interest position (and in light of the practice in estate law this is questionable), the plaintiffs cannot be taken to have waived solicitor-client privilege because he acted in both capacities. The fact that Mr. Takahashi kept the same file for both the wills variation litigation and the administration of the estate is unfortunate; however, it does not evidence a waiver of solicitor-client privilege by his clients qua plaintiffs in the wills variation action.

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