Toronto Estate Law Blog : Toronto Estate Lawyer : Hull & Hull Law Firm : Trust Mediation and Succession Planning : Serving Ontario, Ottawa, Mississauga, Hamilton

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 Listen to: Hull on Estates Episode #249 - Summary Judgment 

This week on Hull on Estates, Natalia Angelini and Rick Bickhram refer to the case Quinlan v. Caron. Specifically, they discuss how this case relates to a summary judgment motion in respect of a will challenge.

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

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

Rick Bickhram - Click here for more information on Rick Bickhram. 

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Yesterday's edition of the National Post highlighted the difficulties small business owners can have with succession planning for the family business.

In one article, Christine Dobby provides statistics for agribusiness owners from a 2010 survey conducted by the Ontario branch of the Canadian Federation of Independent Business. When asked if they had a plan to sell, transfer or wind down their business in the future, an astounding 52% had no plan at all and another 31% said that they had only had informal discussions with family. Only 17% said they had a formal, written plan.

Another article by Denise Deveau illustrates that an assumption that next generation will take over the family business can be a big mistake. According to a recently released Global Family Business Survey report from PricewaterhouseCoopers, 48% of Canadian business owners plan on passing their business to the next generation, which is a significant drop from 90% in 2007. Reasons for this include a change in demographics, where business owners are living longer and having fewer children. Parents who have never taken the time to discuss a succession plan with their children are finding out that the children they assumed would step in and run the family business are not interested in doing so.

These statistics illustrate the need for proper succession planning for the family business and the importance of discussing these plans with one's family. It can avoid a multitude of problems that would inevitably occur for family, employees and customers alike, if the founder of a family business passes away without making proper provision for the business he or she worked so hard to establish.

Sharon Davis - Click here for more information on Sharon Davis. 

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Many of us give to charities by handing out pocket change at the door or by giving monthly gifts by automatic deposit. Some may leave bequests to their favourite charities in their Wills. For those who have a little more to give during their lifetime and beyond, there are additional ways to provide for planned giving to charitable organizations.

For example, the Charitable Remainder Trust (“CRT”) allows the capital of a gift to be given to a charity while the income earned is retained by the donor or some other person for their lifetime. The CRT can be an inter vivos trust given during the donor's lifetime, or testamentary trust that comes into effect upon the donor's death. 

With a CRT, the donor establishes an irrevocable gift to a charity in return for a discounted tax receipt. The cash flow from income generated by the gift is fully taxable. The charity receives an irrevocable gift and upon the termination of the trust, will receive the remainder.

There are many advantages to a inter vivos CRT including:

• Lifetime income to the donor.

• An immediate tax receipt.

• Avoidance of probate, saving probate fees and allowing the existence of the trust to remain private (unlike a Will, which is a public document).

The advantages of a testamentary CRT are:

• Lifetime income to a loved one.

• A tax receipt to the estate.

• The trust is revocable and takes effect on death of the donor/testator.

The most important advantage of a CRT for the charity itself, especially for those created during the lifetime of the donor, is that it allows the charity to project the resources available to it and better plan for achieving its charitable objectives.

Sharon Davis - Click here for more information on Sharon Davis. 

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I recently read an Ontario decision involving a will challenge and the court granted summary judgment to the estate trustee on the issue that the Testator had the requisite testamentary capacity to execute her Last Will and Testament. 

In Quinlan v. Caron, the Deceased executed her Last Will and Testament on May 18, 2007 (the “Will”) and she subsequently died on September 7, 2008. Two days before executing the Will, the Deceased underwent a capacity assessment that was recorded on video. The doctor who conducted the capacity assessment concluded that the Deceased had the requisite capacity to create a new Will.

The daughter of the Deceased commenced a Will Challenge alleging that the Deceased lacked the mental capacity to execute the Will and undue influence. The Estate Trustee is the son of the Deceased and brought a motion for summary judgment against his sister, arguing that there were no genuine issues requiring a trial as his sister’s claim was not supported by any evidence.

The Honourable Justice Tuck put a lot of weight on the capacity assessment and granted summary judgment to the Estate Trustee on the issue of the Deceased’s capacity; however Justice Tuck dismissed the Estate Trustee’s motion for summary judgment on the issue of undue influence. In the decision, Justice Tuck held that “matters of credibility requiring resolution on a case of conflicting evidence ought to go to trial” and he rationalized that there was conflicting evidence in this case, which could suggest that the Deceased was unduly influenced.

Thank you for reading and have a great weekend,

Rick Bickhram - Click here for more information on Rick Bickhram. 

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As I was reading the Financial Post, I came across an interesting article entitled, What Will You Do With Your Estate? In this article, Jonathan Chevreau explains that there are two schools of thought when a parent is deciding how to plan their estate.

On the one hand, some parents believe in transferring the wealth that they have accumulated during their lifetime to their children. On the other hand, some parents believe in “dying broke”. Although it sounds harsh, parents from the second school of thought, often follow the belief that their “kids should stand on their own feet.”

Most of us will fall in between the two extremes; however in his article, Mr. Chevreau reviews the strategies associated with both schools of thought. 

Parents who wish to maximize their estate often don’t like to leave their kids with any debts. Parents from this camp are more likely to “Commute the value of their death benefit pensions in order to maximize RRSP assets … wipe out any lien’s on their residence ... give an inter-vivos gift to their children and pre-pay their funeral.”

In the other camp, parents leaning towards the “die broke” philosophy often try to maximize their assets during their lifetime by using three main techniques: pensions, annuities and reverse mortgages. The nature of all three is to maximize income for the parent and their spouse during their lifetime, while leaving little or nothing for their children.

Wherever along the spectrum you fall, it bears discussing your estate plan with your spouse, kids and a good financial planner or estate planning expert.

Rick Bickhram - Click here for more information on Rick Bickhram. 

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In a recent decision out of the Supreme Court of B.C., Re Thomasson Estate, the Honourable Justice Gerow considered the circumstances where the court may pass over an executor, on an application by a co-executor/beneficiary.

The two Deceased (collectively referred to as the “Deceased”) had been married and had four children together, all of whom survived the Deceased. In their Wills, they named two of their children, as their executors, and directed the executors to distribute the estate to three of their four children. 

One son commenced this application to obtain an order that would pass over the other son as his co-executor for the Estates. The Applicant argued that it is necessary for the Estates to make a proper enquiry into the nature of inter-vivos transactions between the co-executor Respondent and the Deceased and such an inquiry must be made independent of the co-executor Respondent as he would be in a conflict of interest.

The co-executor Respondent opposed the Applicant’s application, and argued, amongst other things, that the court should not interfere with the testator’s right to nominate his or her executor and removing him would be prejudging the case.

In her decision Justice Gerow states:

B.C. legislation is unique compared to the legislation that governs estate trustees in Ontario; however, if a similar situation arose, an application seeking similar relief could be brought under Rule 14.05(3) of the Rules of Civil Procedure.

Rick Bickhram - Click here for more information on Rick Bickhram. 

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Listen to: Hull on Estates # 248 - Registered Disability Savings Plan (RDSP)

This week on Hull on Estates, David Smith and Nadia Harasymowycz discuss a fairly new investment vehicle that has been set up by the Canadian Government to allow for Canadians with disabilities and their families to save for the future.  More specifically, this podcast discusses how one can use this investment fund as an estate planning tool. 

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

For more information on David Smith click here.

For more information on Nadia Harasymowycz click here.

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In a recent blog published by Forbes, Mr. Bernard Krooks considers strategies that could be used to prevent a Will challenge.

In his blog, Mr. Krooks states that "Will contests often occur after a heir or family member perceives some inequity or unjustness in the distribution of money or possessions laid out in the will.  This can be the result of a lack of requisite mental capacity to execute the will, another’s undue influence over the testator, fraud, or improper execution of the will."

Mr. Krooks suggests that a Lawyer drafting a Will can send the testator to medical professional to obtain an opinion on the testator's capacity to execute a Will.   This would be strong evidence which could be used to propound the Will, long after the testator has died.

Mr. Krooks also suggests that the drafting Lawyer should consider the use of a videotape at the time the testator is signing the Will.  Mr. Krooks explains that the videotape could be used to show that the testator signed the Will "freely and with the requisite mental capacity to agree." 

The use of a videotape at a will execution,  has significant benefits, but also has numerous problems.  This technique has been the topic of numerous debates between estate and trust professionals.

There are steps that we can take to ensure that the Will is being executed in accordance with the applicable legislation, which could help the estate trustee propound the Will; however there is no legislation in Ontario that would estopp a party who has a financial interest in an estate from challenging the validity of the subject Will.

Thank you for reading,

Rick Bickhram - Click here for more information on Rick Bickhram. 

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Venturing out into the great beyond this long Victoria Weekend? Is the Thule packed full of musty sleeping bags and the fixin's for S'mores?  Perhaps instead, the allure of a commercial outfitter was simply too much to resist.  You signed the papers, cut the cheque, and now, the adventure-of-a-lifetime lies in wait.

Wise customers always read the fine print, and as a recent article in Outside magazine demonstrates, that adventure-of-a-lifetime might not be the only thing that lies in wait; some of those liability-release waivers pack quite the punch.  As the articles states, the liability-release waiver is a "binding contract that leaves you powerless".  If you refuse to sign on the dotted line, you'll be roasting those S'mores over a hibachi in your backyard. Sign, incur injury and file suit and the results are about as fruitful. Apparently judges toss out 90% of recreation-based lawsuits.

For example, "damages caused by a wild creature in its natural habitat" are often unrecoverable (think shark bites).  And if you are white water rafting, you'll likely be asked to sign a waiver acknowledging the risk of not only falling into the water but knocking heads with your seatmate. The bottom (dotted) line is that waivers are all about assuming acknowledgment of risk especially where the risk is beyond anyone's control.

Have a happy (and safe) long weekend! 

David M. Smith - Click here for more information on David Smith. 

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The expanded powers given to the Court on a motion for summary judgment challenge the Motions Judge to balance procedural expediency against the right to a trial.  In Cranston v. Cranston, the Ontario Superior Court of Justice (Divisional Court) granted an appeal of summary judgment which found an advance of funds from a mother to her son to have been a gift rather than a loan.

The case highlights the difficulty in avoiding a trial where "the central issue is whether an oral, undocumented transaction constituted a gift or a loan."  Although reported in the Estates and Trusts Reports, both the donor and the recipient of the funds were living and able to give viva voce evidence at trial.  While the Motions Judge exercised her power under the new Rule 20.04(2.1) to weigh evidence and draw inferences, the Divisional Court concluded that the absence of viva voce evidence was fatal:

"In Healey v Lakeridge at paragraphs 28 to 32, Perell J. addressed the importance of considering whether the powers under r. 20.04(2.1) should, in the interests of justice, only be exercised at a trial.  He suggested that this question is important to address directly because some issues “cannot be truthfully, fairly, and justly resolved without the forensic machinery of a trial.” An action that turns on credibility as much as this case does falls, in our view, into that category."  

David Morgan Smith - Click here for more information on David Smith. 

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Estate Trustees have an obligation to distribute the estate to the entitled beneficiaries.  What is the appropriate standard of care required to identify all known beneficiaries?  Is it always met?

Title Research reports that, in one instance, "alarmingly, for 50% of the cases we were asked to check, we found unknown heirs entitled to a share of the estate. Perhaps of greater concern for our client, the firm had been appointed as Personal Representative for these cases and furthermore statutory declarations had been signed by family members confirming the information supplied about their family tree was correct."

Some of the most common misconceptions include: (i) previous marriages being missed out and therefore half blood issue of those marriages being overlooked; (ii) individuals of the same surname incorrectly being identified as relatives; (iii) an incorrect assumption that blood related children adopted out of a family are entitled to a share of the estate; and (iv) siblings believing that their nieces/nephews are not entitled to a share of the estate because the previously entitled parent of the nieces/nephews has died.

One of the roles of the estate solicitor is to provide appropriate advice to the Estate Trustee in ascertaining heirs. Where the heirs cannot be ascertained or where there is a question as to who are entitled an application for advice and direction is the recommended course of action. 

David M. Smith - Click here for more information on David Smith. 

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The Ontario Superior Court of Justice (Divisional Court) recently pronounced on the circumstances in which self-represented litigants are entitled to costs.  In Mustang Investigations v. Ironside, the Court considered an appeal of a costs Order in favour of the self-represented Defendant after the Plaintiff discontinued its claim.   

The starting point for the Court's analysis was Fong v. Chang, a 1999 decision of the Court of Appeal.   In that case, Justice Sharpe noted that "to receive costs the self-represented litigant must show that the work done by him or her resulted in a loss by foregoing remunerative activity." It was not sufficient to simply show that the self-represented litigant did the work ordinarily done by a lawyer in order to justify a costs award. 

Moreover, "if an opportunity cost is proved a self-represented litigant should only receive a moderate or reasonable allowance for the loss of time devoted to preparing and presenting the case."

The Court therefore found that "the motions judge in this case erred by ignoring the proviso regarding an opportunity cost and, further, awarding the self-represented litigant the partial indemnity costs that the plaintiff could reasonably be expected to have paid to a lawyer had one been retained by Ironside." 

The Court concluded with this interesting observation: "A question of whether self-represented litigants without legal training should be compensated for performing work normally done by a lawyer at rates for legally trained persons, be they senior lawyers, junior lawyers, or law students, will have serious and far reaching consequences. It is a matter which, in my opinion, is better considered by the Legislature on the advice and with the input of the Rules Committee, than by the courts."

David Morgan Smith - Click here for more information on David Smith. 

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On Thursday February 17, 2011, in the idyllic-sounding community of Sunny Isles Beach, Florida, former Chicago Bears safety Dave Duerson shot himself in the chest. He left behind a suicide note that read: “Please, see that my brain is given to the NFL’s brain bank.”

Duerson was 50 years old at the time of his death.

According to Ann McKee, the co-director of the Boston University School of Medicine Center for the Study of Traumatic Encephalopathy, the results of tests on Duerson’s brain revealed “classic pathology of CTE and no evidence of any other disease. He had severe involvement of areas that control judgment, inhibition, impulse control, mood and memory.” In spite of these cognitive deficiencies, it is not a grand leap to infer that Duerson had a great depth of insight into his condition or the arc his disease would follow in the future.

CTE (chronic traumatic encephalopathy) is a form of progressive, degenerative damage to the brain caused by repetitive closed head injuries (i.e. ‘blows to the head’). It is characterized by the buildup in the brain of an abnormal protein called tau which tends to form in clumps and disrupt brain function. CTE first came to public light after it was identified in the brain tissue of former Philadelphia Eagles player Andre Waters after his suicide in 2006.  The CSTE Brain Bank was established in 2008 for the sole purpose of collecting and studying post-mortem brains, because there is no medical test that can detect CTE in a living person.  The Brain Bank ultimately hopes to answer some of the critical questions about CTE.  How many concussions does it take to cause CTE? Is CTE time-dependent? -  is it the number of years of repeated blows that will determine who gets CTE and who doesn't?  In 2009, McKee published a study indicating that of the 51 confirmed cases of CTE at the time, 90% of the cases occurred in athletes.  If you have 10 minutes to spare today, watch this TIME video called "This is Your Brain on Football" in which McKee is featured.

Last Friday, 28 year old New York Rangers enforcer Derek Boogaard was found dead in his Minneapolis apartment. While details regarding the specific circumstances surrounding his death have been few, it spoke volumes that within 24 hours, Boogaard’s family had stepped forward to donate his brain to the Boston University School of Medicine.  

Jennifer Hartman, guest blogger

* image courtesy of Microsoft

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As I noted earlier this week, I attended the CLE program “Beyond Wills and Estate Planning Essentials”. I’d like to take just a few minutes to share just one of the topics presented which has somewhat surprisingly received a great deal of judicial treatment in the last few years.  The concept of Mutual Wills was presented by Mary-Alice Thomson giving insight into its recent treatment.

The Doctrine of Mutual Wills can trace its principle back to Dufour v. Periera (1769) 21 E.R. 322.  The principle is largely characterized by the involvement of two persons who make an agreement respecting the disposition of their estate, where one person dies having kept the agreement, thereby binding the survivor. Equity will enforce a trust on the estate of the second person to pass away. 

In the last few years, this concept has been raised in many commonwealth countries, and the following are the some of recent cases Ms. Thomson briefly discussed:

• Powell v. Glover, 2008 ABQB 532;
• Atha v. Thompson, 2008 BCSC 1075;
• Brewster v. Lenzi, 2010 BCSC 1488;
• Charles & O’rs v. Fraser [2010] EWHC 2154 (Ch) High Court of Justice (Chancery Division); and
• Bauer v. Hussey & Anor., [2010] QSC 269.

The above list merely skims the surface of recent case law. It should be noted that Charles & Ors v. Fraser, finds mutual wills between two individuals who were not in a spousal relationship; an apparent first in the field.  Given, the rapid nature with which these cases are being heard we may soon see an even greater change in the law. 

Have a great weekend,

Nadia M. Harasymowycz - Click here for more information on Nadia Harasymowycz. 

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The recent election again shone the spotlight on the lifestyle the baby boomers are going to be experiencing in the near future, if they haven't already.  If its not already obvious to you, I'm writing about retirement and whether you will be able to 'live the dream'.

In an article I read, it was noted that to live the 'freedom 55' lifestyle of commercials past, with the golf games and constant travel, we need to start saving more than ever.  The new, or not so new, focus is the result of expectations you may not be able to satisfy with your pension or savings.
If you are starting to plan, and its never too early to do so, consider how long you intend to be retired,  whether your pension is going to be available and whether there will there be enough people paying into it to sustain your expectations.   As life expectancies are also lengthening, whether you can anticipate and health concerns which may be above and beyond your current health care should also be a consideration.

We all work towards the days when we can live out our dreams, but shouldn't we make sure we plan well and for the specific life we want.  While doing so, it can't hurt to consider how all those plans are going to pass on your death. Something to think about.

Until tomorrow,

Nadia M. Harasymowycz - Click here for more information on Nadia Harasymowycz. 

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With the modern definition of ‘family’ being dynamic, it is no wonder that questions regarding when a class closes on ‘children’ has become a concern for many of those who practice in the field of Estate Planning and Estate Litigation. This is to say nothing of the related concerns for those  personally dealing with issues related to assisted reproduction. This concept was addressed in the December Issue of the National. The article noted that perhaps the legislation, both Federal and Provincial, addressing the many and varied issues that have risen in this field, lags well behind the relatively recent catapult in medical technology.

In a response to this article, legal counsel to the Manitoba Law Reform Commission advised of their Report on Posthumously Conceived Children: Intestate Succession and Dependant Relief (Report #118, 2008). The commission recommended legislative amendments to address the eligibility of posthumously conceived children to a share of the Estate on an intestacy. 

Although it is likely that any changes resulting from this Reform Commission would be implemented Provincially first, it is conceivable that this the suggestions will be considered by other legislatures in the country spurring on change. Perhaps this field of law is about to experience an overhaul. Certainly, a topic of interest to keep our eyes on.

Until Tomorrow,

Nadia M. Harasymowycz - Click here for more information on Nadia Harasymowycz. 

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As I’m sure everyone is well aware, the new CPD requirements as regulated by the Law Society of Upper Canada have us all tuned in to the programs being offered and the hours accredited to each. While I blogged yesterday on a past CLE opportunity, I am happy to say that the future opportunities are equally as varied and interesting. 

Among the CLE available in the Estate field which will certainly prove worthwhile, ‘Beyond Will and Estate Planning Essentials’, presented by the Ontario Bar Association, is taking place this afternoon. The program is accredited by the Law Society for 2.5 substantive hours and 1.5 professionalism hours of the required CPD for 2011.  Presentations will be made on the following topics;

• Assessing Capacity and Vulnerability;
• Mutual Wills and More;
• Designation and Declarations – Landmarks and Landmines;
• Registered Disability Savings Plans and Related Planning;
• Business Succession Planning;
• A Review of Ethics and Defensive Practice Tools In an Estate Planning Context;
• 5 Success Strategies for your Estate Planning Practice; and
• Landmines for Lawyers: Exercising judgment in the fact of bad information or a lack of time.

The presentations will undoubtedly be insightful and provide guidance for all Estate practitioners. I’m certain that attendance will be worthwhile and although all CPD programs are in high demand, there may still be some space available. I hope to see you there.

Until Tomorrow,

Nadia M. Harasymowycz - Click here for more information on Nadia Harasymowycz. 

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As Ms. Angelini noted last week, the Six-Minute Estates Lawyer 2011 presented by the Law Society of Upper Canada took place recently. As always, there were many interesting speakers and the topics covered address some of the most relevant issues in estate matters.   On this point, I’m not speaking facetiously when I say that my ears perked up when the issue of U.S. Estate Taxes for Canadians with US Real Property was announced.

On many occasions we have noted that in the near future we are bound to see the greatest passing down of wealth in history.  There has also been a great deal of discussion on this and other forums regarding the new estate and gift tax laws in the U.S.   Mr. Kevin Gluc of Hodgson Russ LLP in Buffalo, N.Y., gave a brief but informative presentation at the Six-Minute Estates Lawyer this year, providing specific information to Canadians interested in holding U.S. property, and further, how such property is likely to pass on death and the taxes likely to be levied on such a transfer.

Mr. Gluc highlighted some of the tax exemptions available to Canadians who hold U.S. assets, as well as the benefits and drawbacks of various manners of holding title jointly, with particular attention paid to the Estate tax implications on the death of one of the owners.   Of surprise to some may be that holding property as ‘joint-tenants with right of survivorship’ may not be the most tax effective strategy for spouses intending to purchase property in the U.S. 

If you intend to purchase property in the U.S., or currently hold property and are considering how to address it in your estate plan, it may be worthwhile to speak to someone who is able to discuss the nuances of each particular type of ownership, in relation to its American tax implications before making any final decisions. 

Until Tomorrow,

Nadia M. Harasymowycz - Click here for more information on Nadia Harasymowycz. 

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Some interesting points Clare A. Sullivan of Aird Berlis made on this topic at the 2011 Six-Minute Estates Lawyer are:

·                    Conflicts - Consider whether the Trustee appointed in the Primary Will is the same as the Trustee appointed in the Secondary Will; if not, it may be that the solicitor can not act for both; it may also support the contention that the testator intended the assets under one Will to be dealt with separately from those governed by the other Will;

·                    Assets - Trustees should list the assets of each estate separately and confirm none of the assets of the secondary estate require probate; if such an asset requires probate, probate taxes will be payable on the total value of the secondary estate;

·                    Notification - The beneficiaries under each Will should be provided with formal notification of their interest in the estate and the probate application, and be given a copy of both Wills;

·                    Creditors – it the Trustees of each Will are the same one advertisement should suffice; separate ads or a joint ad should be considered if the Trustees are not the same; and

·                    Debts and Taxes –

·                    When there are different residuary beneficiaries under each Will, it is important for Trustees to ensure their actions cannot be construed as favouring one or over any other;

·                    If the Trustees and residuary beneficiaries are the same in each Will, and there is no doubt that there will be sufficient assets of both estates to pay all debts and taxes, there will be no issues regarding abatement; and

·                    If the residuary beneficiaries are different or there is not certainty that the residue of the two estates are sufficient to cover all debts and taxes, the Trustees will have to consider from which estate debts and taxes will be paid and which gifts will abate in which order. This may involve an interpretation of the Wills based on the testator’s intentions. If unsure or the beneficiaries disagree with the Trustees’ interpretation, it is advisable to seek the direction from the court.

Thanks for reading and have a great weekend!

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

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Sheila Crummey of McMillan LLP spoke on this topic at the 2011 Six-Minute Estates Lawyer. She noted that until the Garron decision, practitioners relied upon the Thibodeau decision for the proposition that the residence of a trust was determined by the residence of its trustees.

The Garron case has established that the "central management and control test" that applies to a corporation is the appropriate test for the residence of a trust “with such modifications as are appropriate”. 

As for the meaning of “central management and control”, I highlight the following from Ms. Crummey’s paper (although I recommend you read it for a more thorough review):

·                    There are not many decided cases on the issue; it is difficult to make a definitive statement of principle based on judicial decisions, which are fact dependent;

·                    If the appointed trustee fulfills its fiduciary obligations and exercises all of the powers and discretions given under the trust document, the place where the trustee resides will determine the residence of the trust;

·                    The onus is on the trustee to demonstrate it exercised control and management of trust property where residence is at issue; and

·                    If the residence of a trust is critical to the tax plan, the trustee must be prepared to prove that the key trust decisions were made by the trustee (including investment of property, weighing sale options, and decisions with respect to distributions).

While the Garron decision has clarified the test, it is a fact-driven test that will likely need time before the courts so that greater clarity can develop on how it applies in the trust context. 

Ms. Crummey also provides a very helpful list of “best practices” for trust practitioners.

Thanks for reading,

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

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The much discussed case of Reviczky v. Meleknia; Caplan (Intervenor) shone a light on questions about a solicitor’s duty to look beyond a power of attorney.   The facts are summarized in my earlier blog.

This ruling and other case law was cogently reviewed by Deborah Petch in the LawPRO Practice Pro Magazine (Summer 2008). She comments on how the Reviczky ruling has generated discussion among lawyers, with two divergent lines of thinking coming through: some argue that a new standard of care has been imposed, which requires lawyers to “go behind” a power of attorney and not accept it at its face value; while others assert that the usual practice is sufficient and further inquiries do not need to be made.   

From a review of these and other materials, I gather that we may wish to ensure the following when preparing a power of attorney for property and/or when dealing with a transaction involving a power of attorney:

·                    fully explain the nature of the power of attorney;

·                    make sure the donor is fully aware of the consequences (this is especially important when you have had no prior contact with the person, and are acting on behalf of another client);

·                    when you are acting for another client who will benefit from the power of attorney, insist that the donor obtain independent legal advice;

·                    make the power of attorney time-limited when appropriate;

·                    make the terms of the power of attorney no broader than absolutely necessary;

·                    scrutinize the document for irregularities on its face e.g. How many witnesses have signed? Where was it signed?;

·                    consider other questions in order to be alert to suspicious circumstances, such as: When was it signed? How old is the donor? What kind of transaction is being contemplated?;

·                    confirm the transfer with the donor directly (if possible) if these inquiries do not satisfy; and

·                    confirm the transfer with the donor directly (if possible) when the attorney wants to take the property for him/herself, unless the document expressly allows this.

Thanks for reading,

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

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Listen to: The Six-Minute Estates Lawyer 2011 - Hull on Estates # 247

This week on Hull on Estates, Craig Vander Zee and Sharon Davis discuss the Law Society of Upper Canada's recent program The Six-Minute Estates Lawyer 2011, which was held on April 27, 2011.  This annual program featured a series of speakers including Hull & Hull LLP own Suzana Popovic-Montag, Craig Vander Zee and Jordan Atin.

If you have any questions or comments send us an e-mail at hull.lawyers@gmail.com or leave a comment on our blog. 

Craig R. Vander Zee - Click here for more information on Craig Vander Zee. 

Sharon Davis - Click here for more information on Sharon Davis.

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Powers of attorney for property are generally accepted in most Common Law jurisdictions and many Civil Law jurisdictions, which is important given that many have family members and assets in various parts of the world. Subsection 85(1) of the Substitute Decisions Act provides that the foreign grant is valid if at the time of execution it complied with the internal law of the place where it was executed, where the donor was domiciled or where the grantor had his or her habitual residence. 

When multiple jurisdictions are involved, it may be helpful to have a power of attorney prepared in accordance with the rules of the jurisdiction where land is located, so that the forms the regulatory and registration bodies are familiar with are in use. However, take care to ensure that the document contains language specifically preventing revocation. Otherwise a new power of attorney, albeit in a foreign jurisdiction, will effectively revoke any earlier power of attorney granted in Ontario (subsection 12(1)(d) of the SDA). Conversely, a later grant under the SDA will serve to revoke all foreign grants (although section 12 of the SDA would be of no effect when presented in a jurisdiction that does not recognize such powers). 

Here is some noteworthy information regarding the recognition of an Ontario power of attorney for property in other provinces:

·                    it will be valid in Saskatchewan and Manitoba as long as it is valid according to the laws of Ontario, and continues despite the mental incompetence of the donor;

·                    it will be valid as a springing or enduring power of attorney in Nunavut if it is valid according to the laws of Ontario, and it provides the appropriate statement as to its commencement or continuation;

·                    it will be recognized in Quebec, but will be subject to approval and will receive the scrutiny of the courts; and

·                    the legislation in all other provinces currently seem to be silent regarding the application of foreign powers, such that if a grantor has property in any of these provinces one should confer and/or retain local counsel to assist.

Have a good day,

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

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In Estate administration there are occasions when it is necessary to sell, lease or mortgage property in which a minor has an interest. The Estates Administration Act grants The Children’s Lawyer the authority to assist Estate Trustees who do not have sufficient power to convey or lease and mortgage real property on behalf of minors. 

The parameters of The Children’s Lawyer’s and the Court’s involvement is dealt with in detail in The Office of the Children’s Lawyer’s Guide to Practice and Procedure With Respect to Sales of Land. One will need approval of such transactions by The Children’s Lawyer and/or the Court in respect of all but the following occasions:

·                    when it is necessary to sell or mortgage the property to pay the legitimate debts of the deceased;

·                    when there is a mortgage on non-vested real property for which the deceased was liable to pay the mortgage debt and it is necessary to sell to discharge this debt;

·                    when the personal representative is exercising a power given under the will to sell, mortgage, lease, or otherwise deal with real property; and

·                    when a Judge has dispensed with the concurrence of a beneficiary, has made an Order, or has directed a distribution within three years of the deceased’s death.

Executors or Attorneys for Property dealing with real property where there are minor beneficiaries should make themselves aware of the legal requirements with respect to the Office of the Children’s Lawyer.

Thanks for reading,

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