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Listen to:  Unworthy to Inherit - Hull on Estates #185

This week on Hull on Estates, Bianca La Neve and Natalia Angelini discuss a recent application to declare a Beneficiary unworthy on inheriting an estate.

If you have any comments, send us an email at hull.lawyers@gmail.com or leave a comment on our blog.

Bianca V. La Neve - Click here for more information on Bianca La Neve.

Natalia R. Angelini - Click here for more information on Natalia Angelini.

 Unworthy to inherit - Hull on Estates- Episode #185

Posted on October 27, 2009 by Hull & Hull LLP

Bianca La Neve:  Hello and welcome to Hull on Estates.  You’re listening to episode #185 on Tuesday, October 27, 2009.

Welcome to Hull on Estates, a series of podcasts for the Canadian legal community dealing with issues and insights surrounding estate planning in Canada.   Hosted by the lawyers of Hull & Hull, the podcast will touch on some key considerations when planning estates and wills.  Now, here are today’s hosts.

Bianca La Neve:   Hi and welcome to another episode on Hull on Estates.  I’m Bianca La Neve.

Natalia Angelini:   And I’m Natalia Angelini.

Bianca La Neve:   Natalia, today I thought we’d talk about an interesting decision that came out of the Quebec Superior Court recently.  It’s a situation involving an application to have a family member declared unworthy to inherit under the dad’s estate.

Natalia Angelini:   That sounds interesting.

Bianca La Neve:   The citation for the decision will be on our blog page but the facts are basically that dad was a savvy businessman who, during his lifetime, was quite successful, incorporated various companies and helped his 4 children acquire businesses and homes and advance themselves in their own lives.  In 1995, he asked a notary to prepare a Will which was done.  A draft Will was sent to dad for his review but it appeared he never executed the Will.  In 2000, he was diagnosed with cancer and again his advisors advised him to do up a Will but again no Will was executed. He finally died in 2003.

After dad died, the children looked for their father’s Will in the home and at their dad’s office with no success.  They searched every closet.  They looked under the beds.  They looked in dad’s briefcase.  Nothing.  This is all important for later.  So in the summer, not finding a Will, they decided to proceed on the basis of an intestacy which would mean mom would get 1/3 and 2/3 would be divided equally among the 4 children.  Later in the summer, one of the daughters prepared a proposal where she wanted everyone to acknowledge that dad had promised to transfer certain property to her and this would increase her entitlement in the dad’s estate.  However, some of the children refused.  So in November of the year of death, the notary who had prepared the draft Will recommended that a lawyer be appointed to be liquidator of the estate and everyone except for the disgruntled daughter agreed.  The next day, this disgruntled daughter advised everyone that she had actually located a Will of her father in an old briefcase in a bedroom closet in the home.

Natalia Angelini:   That’s an interesting twist.

Bianca La Neve:   So when previously the children had searched the home and found no Will, all of a sudden there was a Will.  So the disgruntled daughter tried to probate this Will, which contained the same provisions as the draft Will prepared by the notary but with certain additions that increased substantially her benefit under the estate.

Natalia Angelini:   Right and I understand it’s also notable that two of the witnesses were actually from the US and there was no evidence that they had crossed the border to come to Canada and sign that Will and there was no independent evidence that they were actually present in Quebec when the Will was allegedly witnessed.  So there was definitely a big question mark as to whether this was actually witnessed by proper witnesses.

Bianca La Neve:   That’s right.  And given all the sort of question marks around the validity and execution of the Will, at the motion for probate, Justice Gagnon ultimately ruled that the Will could not be probated.

Natalia Angelini:   Right and it’s also noteworthy that another sort of suspicious fact was that these witnesses happened to know the husband of this daughter.

Bianca La Neve:   Yes, very convenient.  So after her motion for probate was refused or failed, the disgruntled daughter then produced a document which was actually a blank cheque signed by dad and which allegedly purported to give the disgruntled daughter her share in a building that she coveted and various other monies for her home.

Natalia Angelini:   It seems she was quite tenacious.

Bianca La Neve:   So obviously the children, I guess based on prior conduct, refused to admit the authenticity of this document.  And finally had decided they had enough and they instituted proceedings to have her declared unworthy to inherit under her dad’s estate.

Natalia Angelini:   And that’s an interesting point since in Ontario, we don’t have any similar case law or legislation that would actually allow someone to commence a proceeding, seeking to have someone else precluded from receiving their entitlement because of their conduct.

Bianca La Neve:   So in Quebec, as many of you will know, a lot of their law is codified in their Civil Code and so there are actually two articles in the Quebec Civil Code that deal with someone being unworthy to inherit under the law.  The first provision deals with persons that are unworthy, and that would be someone who was convicted of a crime against the deceased, for example.  And there’s also a provision allowing for certain persons to be declared unworthy and that’s in situations where a person is guilty of cruelty towards the deceased, where the person has concealed, altered or destroyed in bad faith the Will of the deceased, which was our situation here, or a person who has hindered the testator in the writing, amending or revoking of their Will.  And so by relying on this provision, this is the provision the children relied on to try to get their sibling disinherited from her dad’s estate.

So the Court reviewed the facts of the case and the history and ultimately concluded that the disgruntled daughter had likely altered her dad’s Will, had taken the draft prepared by the notary and made some typewritten additions that benefited her to the detriment of her siblings and mother. And the Court actually found that the additions were made by a different typewriter and that lo and behold, dad didn’t know how to use a typewriter and didn’t have access to one in his home.  And then they also concluded that she had likely taken the blank cheque from dad’s house and also forged that after his death.

Natalia Angelini:   Right, that’s quite an exciting result, I have to say.  So that all said the Court found that this daughter was unworthy to inherit and her claims against the estate were dismissed.  That said, even though her right to inherit was nulled, it didn’t prevent her own children from inheriting.  So what happened was they received her share of the estate and so it seems that they were not, I guess, penalized or they didn’t have to suffer any harm from the result of her conduct.

Bianca La Neve:   So I guess that’s also sort of something interesting in the Quebec Civil Code where even though a parent is declared unworthy, at least it doesn’t…the shame doesn’t continue to the next generation.

Natalia Angelini:   Yeah, and so as I said earlier, we have not seen a case like this in Ontario.  However we do see cases where a wrongdoer is precluded from receiving their entitlement under a Will or on an intestacy and that is in the case of murder.  And there’s a case that’s on our blog page, it’s a BC case.  It’s called Re Homes Estate and it was decided in ’07.  And in this case, a testator had left his estate or part of his estate to all of his nieces and nephews.  And one of these nieces was married and her husband was claiming her share.   Conveniently he had killed her and was now trying to profit from it.  The Court quite justly denied his entitlement to her share by applying the general rule of public policy that a person cannot benefit from a crime.  And also I think that is a rule that I think is really upheld as much as possible in Ontario, although it hasn’t been expanded yet to include the type of conduct we saw in this Quebec case.

Bianca La Neve:   So it was interesting that in Quebec you actually have a provision where you can have someone declared unworthy and then I guess it turns on the facts and fact specific; whereas in Ontario, it’s more this public policy idea that someone can’t benefit from their crime.  And in our estate litigation practice, where we see that played out is in the context of people murdering the deceased or testator and then trying to obtain a benefit from the estate.

Natalia Angelini:   So it’s noteworthy that this public policy rule does not just apply to estate cases involving Wills but also involving insurance matters.  And so in one case, Ferry Estate and Non-Marine Underwriters of Lloyd’s of London, the Ontario Supreme Court looked at a situation where the murderer of an insured was also the sole beneficiary of the policy.  And the Court, you know, reiterated the public policy that a wrongdoer can’t recover the insurance proceeds.  However it also noted that Courts can’t step in and substitute some other beneficiary for the murderer.  That’s just a simple matter of contract law.  So while public policy prevents the criminal from profiting from the crime, the Court can’t, in essence, re-write the policy to have someone else receive the proceeds.  So in that type of situation, the insurer is under no obligation to pay the proceeds out at all.  Now in the facts of this case, I believe that the wording of the policy actually was in such a way that the estate was able to receive the funds, so that was a good result.

Bianca La Neve:   So that’s interesting whereas in Quebec you already have that built in, that uncertainty is cleared up where you declare one person unworthy, they allow for the children of that person to inherit under the estate if appropriate.  So that’s an example of the loop being closed in Quebec but perhaps the loop is still open in Ontario.  It remains to be seen what subsequent case law will do.  And on that note, I do note that the Quebec decision is currently under appeal and so if the appeal is successful, we will certainly let our listeners know.

Natalia Angelini:   So thanks, Bianca, for podcasting.  And we look forward to hearing from our listeners.  You can send us an e-mail at hull.lawyers@gmail.com.  You can visit our blog page at estatelaw.hullandhull.com where you’ll find even more information on today’s practise of estate law.  We hope that you enjoyed the show.  I’m Natalia Angelini.

Bianca La Neve:   I’m Bianca La Neve.  Until next week.

This has been Hull on Estates with the lawyers of Hull & Hull.  The podcast you have been listening to has been provided as an information service.  It is a summary of current legal issues in estates and estate planning.  It is not legal advice and you are reminded to always talk with a legal professional regarding your specific circumstances.

To listen to other podcasts, or to leave a question or comment, please visit our website at www.hullandhull.com.

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