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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The Ontario Court of Appeal has upheld a decision of the Superior Court of Justice that doctors must get approval from the Consent and Capacity Board in circumstances where their decision to withdraw life-support treatment is contrary to the wishes of a patient's family.

In her decision as the lower court Judge, Madam Justice Himel concluded as follows:

"Treatment” under the HCCA includes the withdrawal of life support. Therefore, doctors require consent when withdrawing life support in Ontario. End of life cases present very difficult considerations for all parties involved. It is clear from the evidence that the hospital, doctors and substitute decision-maker in this case all have as their priority the best interests of the applicant. We are fortunate in Ontario that our legislature has provided a statutory scheme to assist doctors and substitute decision-makers in determining when an incapable person should be removed from life support, complete with recourse to an independent, expert tribunal in the event that a dispute arises in applying the best interests test. This statutory scheme will allow the applicant’s doctors to challenge the substitute decision-maker’s decision refusing consent to the proposed plan at the CCB. While no end of life decision can be easy, the process established by the HCCA provides consistency and ensures a full consideration of an incapable person’s best interests in cases such as this."

The Ontario Court of Appeal agreed that Mr. Rasouli's physicians required the approval of Ontario's Consent and Capacity Board before they could take the patient off a ventilator.

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

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Spiders freak me out. I mean, they really...freak...me...out. I can handle the little ones; the ones with features so tiny, they are barely discernible. It’s the ones that have substantive girth, the ones with tricked out designs resembling alien heads on their backs  – those are the ones that cause me to fear for my personal safety. The logical part of my brain reminds me that I am 200 times larger than the average spider, and further, there are only 3 species of poisonous spiders in Ontario. In the battle mano a arachnid, I’m pretty sure I’d come out on top. So what’s with my visceral urge to flee? Why does emotion trump logic and hard data?

“What You Don’t Know Can Kill You”, an article in the July/August 2011 issue of Discover Magazine, speaks to the “perplexing tendency of humans to fear rare threats such as shark attacks while blithely ignoring far greater risks like unsafe sex and an unhealthy diet”. The author cites the recent example of Americans spending $200 to hoard $10 bottles of iodine pills after the Fukushima nuclear disaster in Japan. The U.S. EPA estimated the radiation reaching the west coast of the United States to be about 1/100,000th the dose one would receive on a round-trip international flight.  And yet over the course of a few weeks, Americans wiped out pharmacy supplies of the drug.  Why are we so inept at gauging real risk?  According to the article, the core of the issue lies in conflicting inputs: logic vs. instinct. The instinct part of the equation appears to have roots in evolution, which results in a healthy fear of sharks, bobcats and the like. The article states that deep inside the amygdala (the brain's emotional core), "our hardwired gut reactions developed in a world full of hungry beasts and warring clans, where they served important functions".  No matter that each year, falling coconuts kill ten times as many people as sharks do.  Move over logic, emotion is driving this car now.

              * Photo courtesy of Jennifer Hartman and one heckuva digital zoom function

Jennifer Hartman, guest blogger

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Although decided over twenty years ago, Re Nicholls 57 O.R.(2d) 763 remains a leading case and is a fascinating decision of the Ontario Court of Appeal that goes to great lengths to defend testamentary freedom and the fundamental distinction between a trust and a power of appointment.  In that case, the testator gave her estate to her executor in trust and directed the executor "to follow the dictates and directions given to him from time to time by Carson Cowan as to the distribution of the rest and residue of my estate."  Mr. Cowan was a "minister" of a "religious group" that the testator had been a member of for some fifty years.  After the testator's death, Cowan gave the executor written directions to distribute to six member of the religious group.  The executor sought directions.  When the lower Court accepted the validity of Mr. Cowan's authority, the executor appealed.

The Court of Appeal dismissed the appeal. The general power of appointment given to Mr. Carson was deemed to be equivalent to property.  Unlike a trustee, Carson could have appointed himself as donee. The Court of Appeal approved of the lower court's distinction between the case at bar and the prohibition against an estate trustee selecting beneficiaries that would have been void for uncertainty.  The testator in Re Nicholls chose to create a Will where the trustee was subject to the exercise of the power of appointment by Carson. This the testator was free to do. 

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

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In England and Wales, a decision of the Chancery Division, which seemed to suggest the adoption of something akin to the Canadian approach to the remedial constructive trust in joint tenancy disputes, has been reversed by the Court of Appeal (as reported in the STEP Trust Quarterly Review).

In Jones v Kernott [2010] EWCA Civ 578, a man (Kernott) and a woman (Jones) (not married) had purchased a house together in joint tenancy. The relationship ended, and the lower Court awarded Jones a ninety per cent interest in the residence: she made the down payment, and paid the vast majority of the payments due on the mortgage (after the relationship ended and the man left).  Moreover, after separation, Kernott paid nothing towards the support of their children.  Kernott appealed this decision on the grounds that, as a joint owner, and in the absence of any evidence (especially the absence of a cohabitation agreement) to the contrary, he was entitled to an equal fifty per cent share in the house.

The decision of the Court of Appeal (Kernott v. Jones [2009] WTLR 1771) essentially concludes that, in this type of case and in the absence of evidence of actual intention, the Court does not properly have jurisdiction to invoke an equitable remedy. Fairness can not be considered to alter the rights of a joint tenant to a fifty per cent interest in  property unless there is some evidence of intention to the contrary. Put another way, it can not be presumed, in the complete absence of evidence of intention, that joint tenants have a shared intention that each should have a "fair and just share" other than fifty percent.

While the Canadian law has moved since the landmark case of Pettkus v. Becker to fashion equitable remedies for someone in the position of Jones, a cohabitation agreement (regardless of jurisdiction) would still seem the best way to avoid any question as to the intention of the parties. See this link for an interesting discussion by Donovan Waters of the different evolution of Canadian law (and which inspired this blog's title).

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

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Fridays have always held a special place in my heart. This can probably be attributed to the knowledge that Friday meant the start of the weekend and to time all my own. A small part of me also attributes my joy of Fridays to the cartoons that I recall from my childhood, which always seemed to fill a bit more of the newspaper on Friday mornings. As I moved into adulthood and chose my career, the cartoons and jokes that everyone around me seemed to share took on a particularly ‘anti-lawyer’ humour. Despite the deprecation of my profession, I have to say, I continue to love a good joke, whatever the topic.

In a profession as serious as law, we don’t often have an opportunity to show off our funny-side. Cracking jokes, or seeing the humour of a desperate situation, is not often appropriate in a client meeting; it is certainly not appreciated (or is at least difficult to convey) in written correspondence with counsel; and understandably, can fall on deaf ears in a court room. Yet, most of the lawyers I know are quite funny when you sit down and have a chat. 

To celebrate our often hidden senses of humour, I wanted to share a web site I recently came across. LegalHumour gives lawyers a venue in which to be funny. Perhaps the sense of humour exhibited therein isn’t everyone’s cup of tea, but, if you have a few minutes, check it out and kick off your weekend with some Friday Funnies.

Thanks for Reading,

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

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In early February I blogged on a case that was before the British Columbia courts dealing with the rights of children of sperm donors to information from their biological parent. On May 19, the British Columbia Supreme Court released its ruling in the Pratten v. British Columbia (Attorney General), 2011 BCSC 656 CanLii, finding that the British Columbia Adoption Act was unconstitutional. 

The court in Pratten was not asked to deal with any questions of inheritance or rights to an estate, but it seems likely that in its wake estate planners and estate litigators will have to put on their thinking caps and get creative. The impact of this decision could take years to unfold and in the interim, there are likely to be a lot of individuals who may be reconsidering their estate plans.   Some of the changes and concerns that may impact our field, and individuals, are raised in the most recent issue of Lawyers Weekly, in an article by Jeremy Hainsworth. 

This decision has the potential to alter a variety of legal fields, and will certainly impact the British Columbia legislature. Whether that impact will be felt across the country is something only time will tell. 

Until Tomorrow,

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

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I wrote yesterday about some of the factors you may want to consider when preparing an estate plan that contemplates a gift to a charity. What I didn’t address was the possibility that despite your best efforts, your beloved and well supported charity may cease to exist at some point between the creation of your estate plan and your death. As estate litigators, we don’t shy away from a cy pres application, and we may even find some enjoyment in the academic aspects of the process, yet, is that really where you want your hard earned funds to go?

Knowing how you want your money spent and who you want it to go to is clearly just part of the battle. There are many ways to ensure that your intentions are given effect; mostly they involve your detailed and thought out instructions and well drafted testamentary instruments. If you have any significant concerns about the viability of your favourite charity or the longevity of its current name, and are considering making a donation in excess of $250,000.00,options exist, including the Aquaduct Foundation which provides a vehicle for charitable donations, allowing you to control the purpose of your charitable giving.  Lauren Storer provides some further insight into the benefits of such planning here. 

At the end of the day, where your money goes is your decision, but don’t you want to know that your wishes will be carried out?

Until Tomorrow,

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

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 Listen to: Canadian Donor Guide - Hull on Estates # 252

This week on Hull on Estates, David Smith and Nadia Harasymowycz discuss the recent Canadian Donor’s Guide. This publication is an annual directory of fundraising organizations in Canada.

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

Click here for more information on David Smith. 

Click here for more information on Nadia Harasymowycz. 

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It isn’t a secret that the current passing down of wealth is the most significant of its kind in our history. With the definition of ‘family’ constantly changing and generations outliving those behind, the passing down of wealth may not be in the form we once anticipated. It seems, that in response to these various fluctuations in cultural expectations, testamentary dispositions to charities are on the rise. The only snag with that plan is that choosing a charity to leave your money to isn’t as easy as simply naming your kids.

I recently received the Canadian Donor’s Guide to fundraising Organizations in Canada (the “Guide”) which contains many interesting articles related to this field, as well as a listing of many charities seeking contributions.  The following are a few of the likely considerations you should make before choosing a charity to donate to, as suggested by Mr. Malcolm Burrows in the Guide;

1. How is the Charity going to use the Bequest?;
2. Accountability of the Charity;
3. Can the gift be designated for a particular purpose?; and
4. Can a donor remain anonymous?

Although there are certainly many factors, both general and those specific to your charity which you may want to consider when making a donation, the above may start the ball rolling. For a more fulsome listing of questions and considerations, as well as a listing of charities, consider the Canadian Door’s Guide website as a resource.

Until Tomorrow,

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

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The summer sun finally seems to have broken through the clouds; with the weather this beautiful everyone seems to be focused on getting outside and taking a break. Yet, we can’t forget that we are nearly at the half year mark, meaning that there are only 6 more months to complete your CLE requirements.   Rest assured, there are still opportunities to satisfy your hours, one of which occurs this week. Hull & Hull LLP is hosting its second Breakfast Series of the year, our own kick off to summer this Thursday, June 23, 2011.

I hope you are able to join us, whether in person, via webcast or through telephone dial-in, to hear Ian M. Hull and Suzana Popovic-Montag speak about the importance of addressing your digital legacy when preparing your Estate Plan. The program is sure to be interesting, and if that alone is not enough, it has been given CPD accreditation, putting you one step closer to meeting your CLE requirements. For more information regarding the Breakfast Series, or to register, please check out our website.  

See you Thursday,

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

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No more lineups at your local ServiceOntario kiosk.  No more downloading forms (only to have them wait patiently by the front door for the mail strike to end, but I digress).  At long last, residents of Ontario can now register online as an organ and tissue donor on a new website: BeADonor.ca.

In August 2010, I blogged about the tedious and onerous process of organ donor registration in the province that existed at that time.  Adding to the confusion is the widely held belief that carrying a signed organ donor card is tantamount to formal registration.  It isn't, and therein lies the glitch; a signed donor card is not recorded in the Ministry of Health and Long-Term Care's database, is often out of date, and is then subject to conflicting family wishes. 

There is no cost to register.  Online registration is easy, convenient, and secure.  1,500 people in Ontario are waiting for an organ donation right now.  Ontario's Health Minister, the Honourable Deb Matthews, issued a challenge on Tuesday when she expressed her hope that 1,500 new people will register by the end of the week.  If registering to be an organ/tissue donor has been on your 'to do' list for a while, take a few minutes and cross this one off. 

BeADonor.ca.

Jennifer Hartman, guest blogger

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In Prong Estate, Re, the moving parties, being six of the beneficiaries, were unsuccessful in their request for an order directing the return of the Certificate of Appointment of Estate Trustees with a Will and to have the Will proved in solemn form.  In rendering the costs decision, the Court noted, among other things:

·                    the motion was brought more than two years after the Certificate of Appointment was issued, and after the administration of the estate was substantially complete;

·                    the motion was based on a suspicion or belief that was not supported by evidence, with no due diligence inquiry being undertaking by or on behalf of the moving parties;

·                    there is no reason in this case to depart from the general rule that provides the estate trustees with full indemnity, or solicitor-client, costs:  see Goodman Estate v. Geffen;

·                    costs in estate litigation are dealt with in the same manner as other civil litigation as provided in section 131, Courts of Justice Act and Rule 57, Rules of Civil Procedure - the traditional approach of having the estate bear the costs of all parties no longer applies:  see McDougald Estate v. Gooderham;

·                    as was more fully discussed in the prior endorsement on the merits, it is not appropriate to burden the estate with the costs of the motion to any great extent; and

·                    the Court’s role is to determine a cost award that is reasonable having regard to the factors set out in Rule 57.01:  see Boucher v. Public Accountants Council for the Province of Ontario.

The Court did not grant the moving parties any award of costs. While the view of the Court was that the estate trustees were entitled to full indemnity costs payable by the moving parties, it granted the entire cost award apportioned between the moving parties and the estate assets as was requested by the estate trustees.  

Have a nice day,

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

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Listen to: Return of a Certificate of Appointment - Hull on Estates # 251

This week on Hull on Estates, Paul Trudelle and Rick Bickhram discuss obtaining a return of certificate of appointment with reference to the Estate of Donna-Rae Prong, Deceased.  2011 ONSC 632 (CanLII). 

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

Click here for more information on Paul Trudelle.  

Click here for more information on Rick Bickhram. 

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In Thorpe v. Fellowes Solicitors LLP, [2011] EWHC 61 (Q.B.), a firm of solicitors in London, England successfully defended a negligence action alleging that they acted on the sale of a property without proper instructions from their client, Mrs. Hill, an elderly lady, when she was suffering from dementia.  

The Judgment considers the issue of capacity in detail and, among other things, the Court notes the following:

· a solicitor is generally only required to make enquiries as to a person’s capacity to contract if there are circumstances such as to raise doubt as to this in the mind of a reasonably competent practitioner;

· there is a presumption of capacity, and only if this is called into question should a solicitor seek a doctor’s report (with client’s consent); and

· the Court was satisfied that the lawyer acting on the transaction performed her duties responsibly and took careful notes.

In addition, the Court accepted the evidence of one of the experts whose opinion was that Mrs. Hill was capable to participate in the property transfer even though she suffered from progressive dementia.  Some highlights of the expert’s view are as follows:

· cognitive function can be quite impaired and yet a patient can still have free will and sense of what they want and what they do not want; and

· when assessing capacity medically one would question the patient about how she understands the effect of her decision on other people, and if the patient does understand this, even if there is profound cognitive compromise, then capacity is retained; and

· while dementia may impact on the understanding of particular matters, “even patients with quite severe dementia could still have formed and reasonable opinion" (sic).   

Thanks for reading,

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

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Ian Hull writes about what could be a valuable new product for the non-professional executor in the June 10, 2011 issue of The Lawyers Weekly - the new errors and omissions insurance.  
 
Mr. Hull notes the following areas of conflict that generally occur in the administration of an estate:

·                    preferential treatment of certain beneficiaries over others;

·                    timing issues relating to the sale of real property or various types of financial instruments;

·                    allegations of conflict of interest on the part of the estate trustee; and

·                    failure to value the estate assets properly, or at all.

In addition, Mr. Hull addresses factors leading to increased risk for executors, including:

·                    more complex relationships between beneficiaries given the rise of second marriages and blended families;

·                    real estate and financial instruments are more volatile in nature and thus more sensitive to timing than previously;

·                    society is more litigious than in the past; and

·                    people have more information at their fingertips, and therefore may have greater expectations for the estate trustee to manage.

This new insurance product, ERAssure (exclusively available with the counsel of a lawyer) insures executor clients for the costs of defense and indeminty for damages awarded against them that arise out of errors and ommissions made during the estate administration.  It is available for estates with $500,000 to $5,000,000 in assets.  I think this is an important product for estate trustees to consider obtaining if they want to maximize their risk protection. 
 
Thanks for reading,
 
Natalia R. Angelini - Click here for more information on Natalia Angelini. 

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M. Jasmine Sweatman and Bethany J. Anderson wrote an interesting paper focusing on capacity assessments, presented at Beyond Will and Estate Planning Essentials held on May 10, 2011 by the Ontario Bar Association.

They addressed the two broad categories of capacity assessment: those undertaken pursuant to statutory authority, and those commissioned privately.  The Substitute Decisions Act (“SDA”), the Mental Health Act (“MHA”) and the Health Care Consent Act (“HCCA”) provide for statutory capacity assessments.  As the authors note, very significant consequences can arise under these kinds of assessments.  For example, if found incapable to manage property by an assessor under the SDA or if a certificate is issued by a physician under the MHA with respect to an in-patient of a psychiatric facility, the result is the nearly automatic appointment of the Public Guardian and Trustee (“PGT”) as the person’s statutory guardian of property.  

That said, the PGT can be replaced as the statutory guardian of property upon a successful application by: (a) the incapable person’s spouse or partner; (b) a relative of the incapable person; (c) the incapable person’s attorney under a continuing power of attorney, with certain restrictions; or (d) a trust company.

In contrast, privately commissioned assessments that conclude the person is incapable of managing their property may not automatically deprive the person of decision making ability.  The assessor retained is chosen, and the lawyer and client have the discretion to determine who performs the assessment as well as the scope of the assessment.  The authors point out that the assessment in these cases can serve to protect both the client and the lawyer, and can establish the client’s capacity at a particular point in time.

In our practice we see on occasion that testators are assessed just prior to making a new Will, which can be a particularly good idea if a challenge to the validity of the Will is anticipated after death.

Have a good day,

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

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Last week, Globe and Mail columnist Tim Cestnick wrote on cottage ownership through a trust. 

This week, Tim follows up his article with “Seven hints for holding a cottage in trust”.

The hints relate to:

1. Dealing with the tax hit upon the transfer to the trust.

2. The taxation of the taxable benefit of using the cottage.

3. The effect of the 21 year deemed distribution rule.

4. U.S. estate taxes.

5. The payment or avoidance of Land Transfer Taxes.

6. The payment or avoidance of HST.

7. Extra requirements in the event that the cottage needs to be mortgaged.

Both articles are worth a read by anyone considering ownership of a cottage through a trust. They highlight the benefits of such ownership, while also raising the myriad of issues and complications that can arise with such a vehicle. Clearly, good advice is needed by anyone considering the use of a trust for cottage ownership

Also, see our blogs and podcasts for more information relating to cottage ownership and succession. Also, just last week, our Ian Hull spoke on BNN about strategies to keep a cottage property in the family.

Clearly, this topic is as hot as our recent taste of summer weather.

Have a great weekend.

Paul E. Trudelle - Click here for more information on Paul Trudelle. 

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The Supreme Court of British Columbia recently dismissed a claim made by an erstwhile beneficiary against a person alleged to have unduly influenced a testator to remove the beneficiary from the testator’s will.

In Moore v. Piccioni, 2011 BCSC 664 (CanLII), a son alleged that his mother made defamatory statements about him to his grandmother which resulted in the loss of the grandmother’s love and support, and his removal as a beneficiary of her will. The son also alleged that the mother unduly influenced the grandmother, causing her to remove him from her will.

The son brought a claim against his mother for the slander, and for damages as a result of the undue influence. The mother moved to dismiss the claims.

On the issue of slander, the court held that the claim was statute-barred.

On the issue of the claim for damages arising from the alleged undue influence, the court held that there was no cause of action for undue influence.

In so doing, the court did not cite any case law. However, the court noted that the son had also filed a caveat (akin to a Notice of Objection in Ontario), and that a probate action was commenced by the mother to have the will pronounced in solemn form, and the caveat dismissed.

The court held that the probate action was the appropriate action in which to try the issue of undue influence.

Presumably, if the son was successful in the probate action, then the will would be set aside and he would not suffer any damages. If undue influence was not proved, and the will was not set aside, then the son would not be entitled to any damages in any event.

Thank you for reading.

Paul E. Trudelle - Click here for more information on Paul Trudelle. 

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Yesterday I introduced the issue of substantial compliance with the formal requirements of making a valid will, and the case of Robitaille v. Robitaille Estate, 2011 NSSC 203 (CanLII).

After considering other cases where substantial compliance was an issue, the court went on to accept the validity of the will, even though it was not properly witnessed.

The court initially raised the question of whether the testator had testamentary capacity. The court observed that where a will complies with the formalities of execution, there is a rebuttable presumption of capacity. The court went on to hold that this same rebuttable presumption should apply to a writing that a party seeks to enforce as valid under the relevant “substantial compliance” legislation.

Moving on to the main issue, the court succinctly stated the test to be met: “I must be satisfied that the testator’s revised will represents a deliberate or fixed and final expression of her intention to dispose of her property on death.”

The court held that the writing met this test. The writing was deemed to be valid and fully effective as a will.

The court stated that the addition of the “protective trust” with respect to the bequest to one of the beneficiaries may have raised a red flag. However, the provision was similar to one that applied to another beneficiary, and furthermore, the beneficiary against which the provision applied did not contest the validity.

The case contains very little discussion as to the exact nature of the non-compliance. In the recitation of the facts, the court notes that the revised will was not witnessed at the time of the testator’s signature. Instead, the witnesses added their signatures after the fact. It may be that the fact that there were in fact witnesses to the signing of the will, and a certain level of formality, added to the comfort level of the court in making the determination.

Thank you for reading,

Paul E. Trudelle - Click here for more information on Paul Trudelle. 

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Listen to: Hull on Estates # 250 - OBA Trusts & Estates Section Year End Dinner

This week on Hull on Estates, Craig Vander Zee and Natalia Angelini reflect upon the recent Ontario Bar Association Trusts & Estates Year End Dinner, which was held May 31, 2011 in the Distillery District here in Toronto.

If you have any questions or comments, send us an email 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.

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

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We have blogged and podcasted in the past on the formal requirements of Ontario’s Succession Law Reform Act, and the effect of non-compliance. In Ontario, there is no provision for “substantial compliance”, and a Will not executed in accordance with the strict requirements will not be accepted: see Sills v. Daley, [2002] O.J. No. 5318 (however, see also, Sisson v. Park Street Baptist Church, [1998] O.J. No. 2885).

Other provinces, such as Manitoba, New Brunswick and Nova Scotia, have provisions that give the court discretion to order that a writing is valid and fully effective as a will even though it was not executed in compliance with the relevant legislative requirements.

In Nova Scotia, the legislation provides:

“Where a court of competent jurisdiction is satisfied that a writing embodies

(a) the testamentary intentions of the deceased; or

(b) the intention of the deceased to revoke, alter or revive a will of the deceased or the testamentary intentions of the deceased embodied in a document other than a will,

the court may, notwithstanding that the writing was not executed in compliance with the formal requirements imposed by this Act, order that the writing is valid and fully effective as if it had been executed in compliance with the formal requirements imposed by this Act.”

The application of this provision was discussed in the recent Nova Scotia decision of Robitaille v. Robitaille Estate, 2011 NSSC 203 (CanLII).

There, the testator met with her lawyer to discuss a change to the appointed executor under her will. The next day, the lawyer spoke to the testator by phone (recognizing her voice) to discuss making a change so as to add a clause imposing a protective trust for the bequest to her daughter similar to the clause that was in place for her son. Before the revised will could be discussed and executed, the testator fell ill and was hospitalized. Another daughter phoned and asked the lawyer to email the will to her so that it could be executed by the testator. 

The testator then signed the will, and died a few days later.

Unfortunately, the will was not signed by the witnesses in the presence of the testator, as required by Nova Scotia’s Wills Act.

What did the court do? Tune in tomorrow.

Paul E. Trudelle - Click here for more information on Paul Trudelle. 

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Hot on the heels of the BC Court of Appeal decision that Sharon Davis blogged on last Friday is the BC Supreme Court decision of Graham v. Ellard, 2011 BCSC 672 (CanLII).

There, a surviving spouse brought a claim against her late husband’s estate for a declaration that she is entitled to a beneficial interest in the estate’s half interest in the home on the basis of unjust enrichment.

The wife and the deceased were divorced in 1998. The divorce order required that their home be sold, and the proceeds divided equally. However, the order further provided that the home was not to be sold until the youngest child was no longer a child of the marriage. However, the home was never sold, even after the youngest child ceased to be a child of the marriage, or following the death of the husband.

The deceased died in 2001. After his death, his estate brought an application to sell the home, but the application was, for reasons that are not clear, dismissed. 

From the date of the divorce until the trial, the wife paid all of the upkeep expenses associated with the home.

In response to the wife’s claim to the estate’s interest in the home, the estate raised a number of defences. The first was that the claim was barred by reason of cause of action estoppel. The estate argued that the sale of the home was ordered at the divorce trial, and thus it was not open to the wife to now raise the issue.

The court held that the wife could have raised the issue of the husband’s contribution to the carrying costs of the home, but didn’t. Her claim on the basis that she was entitled to contribution for carrying costs was therefore dismissed.

However, the court held that the wife’s claim for unjust enrichment was allowed to stand. The evidence was that the value of the home increased substantially: from $195,000 to $395,000. The wife’s claim for unjust enrichment was found to not be res judicata, as it did not exist at the time of the divorce trial. The court held that it was unforeseeable at the time.

The court went on to hold that the estate was unjustly enriched by the increase in the value of the home as a result of the wife paying the carrying costs over the years.

As to a remedy, the court ordered that the home was to be sold and the proceeds divided between the wife and the estate, subject to the estate being liable to the wife for half of the carrying costs paid by her, other than utilities.   No set off for occupational rent was allowed. (The decision contains a good, concise summary of the equitable principles to be considered when considering a claim for occupational rent.) 

Thank you for reading,

Paul E. Trudelle - Click here for more information on Paul Trudelle. 

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The recent B.C. Court of Appeal decision of McMillan v. Johnson (Estate) 2011 BCCA 48, deals with the valuation of an unjust enrichment claim of a long-time common law wife against the estate of her deceased common law husband. 

The couple lived together for almost 40 years and both contributed to a family fishing business, of which the deceased was the sole shareholder.  The deceased did not properly provide for his wife and although she would have had a claim under the Wills Variation Act, she was out of time and so claimed a constructive trust against the only valuable asset in the estate, a $2.4 Million shareholder’s loan owed to the deceased by the fishing business. 

The trial below proceeded summarily and rather than declaring a constructive trust, the trial judge awarded the wife a monetary remedy of 50% of the value of the loan ($1.2 Million). 

On appeal the estate argued that the value should have been assessed at 50% of the market value of the company at the time of trial, which would reflect the decline in the fishery since death, and that the judge erred in awarding the book value of the loan valued as at the date of death. The estate led no evidence of the actual value of the company at trial and sought to introduce this as fresh evidence on appeal.

The appeal was allowed and a new trial ordered on the question of the value of the loan and the company as at the date of the new trial.  Fresh evidence as to the value of the company was not allowed. The judge intended to award a monetary remedy in lieu of a proprietary remedy, and therefore the valuation date should have been the date of trial.   

If you are interested in a more in depth consideration of the case law on constructive trusts, unjust enrichment and quantum meruit, and whether/when an in personam monetary remedy or proprietary remedy is appropriate, you should refer to the decision for some helpful comment on these issues.  

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

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As most litigators know, one of the more significant changes to the Ontario Rules of Civil Procedure was with respect to summary judgment motions under Rule 20. Under the new Rule, the test changed from “no genuine issue for trial” to “no genuine issue requiring a trial”. The motions judge was also given enhanced powers, including the ability to weigh credibility, draw inferences and hear limited oral evidence in the “mini-trial”. 

In the 18 months since the changes, the courts have had a chance to interpret the Rule and two approaches have emerged. The restrictive approach in Cuthbert v. TD Bank and New Solutions Extrusion Corporation v. Gauthier holds that the amendments have not fundamentally changed the nature of summary judgment, which is not a summary trial. 

The second, more expansive, approach in Healey v. Lakeridge Health Corporation and Canadian Premier Life Insurance Company v. Sears Canada Inc. holds that the motion judge may exercise the powers of the trial judge, including finding facts, unless there is a good reason not to do so. 

There will be a group of 5 appeals heard together by the Ontario Court of Appeal this summer in which the new Rule 20 will be interpreted to provide some guidance regarding the scope of the new powers and the implications for the rest of the trial. Other issues will also be addressed including the duty to give reasons on a summary judgment motion, the rights of cross examination in mini-trials, and costs.

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

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When can someone who is not a party to the litigation be examined? The Court may grant leave to examine for discovery any person who there is reason to believe has information relevant to a material issue in the action, other than an expert engaged by or on behalf of a party in preparation for contemplated or pending litigation.

Pursuant to Rule 31.10 of the Rules of Civil Procedure, such an order can be made if the Court is satisfied that:

a)      the moving party has been unable to obtain the information from other persons whom the moving party is entitled to examine for discovery, or from the person the party seeks to examine;

b)      it would be unfair to require the moving party to proceed to trial without having the opportunity of examining the person; and

c)      the examination will not,

           i.   unduly delay the commencement of the trial of the action,

           ii.  entail unreasonable expense for other parties, or

           iii. result in unfairness to the person the moving party seeks to examine.

In Ryndych v. Hamurak, 1999 Carswellont 4061, [1999] O.J. No. 4718, Molloy J. allowed the examination of the minister who performed a marriage ceremony between the defendant and the deceased, who died intestate. The plaintiffs had attempted to interview the minister but she refused to answer questions. The validity of the marriage was central to the case and it was very likely that the minister had information relevant to the issues in this action that was not available from any party. The Court commented that it would be unfair to require the plaintiffs to go to trial without having the opportunity to examine the minister who officiated at the wedding.

Further, the Court found that it was not necessary for the plaintiffs to serve their notice of motion on the non-party they sought to examine. The intention of the Rules was not to require service of the notice of motion on the non-party. The position of the non-party was protected under the Rules because a person affected by an order obtained without notice was entitled to bring a motion to have the order set aside. There was also no requirement that plaintiffs examine the defendant prior to examining the non-party.

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