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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Today’s blog is the last in my series this week touching upon certain aspects of preparation for trial/hearing in a contested passing of accounts. The items discussed this week were certainly not meant to be, nor were they, exhaustive. Preparation necessary for a hearing/trial with narrow issues, few documents, few evidentiary concerns and an uncomplicated Estate will obviously be different than a case with numerous issues, voluminous documents, evidentiary issues and a complicated administration. The critical aspect of trial preparation is that it begins at the beginning of a case; not literally, but certainly in the sense of being mindful at pre-trial stages of the evidentiary considerations and how the evidence is to be marshalled and presented.

Aside from ensuring that you have appropriate resource materials at the trial (such as texts dealing with the rules of evidence, the Rules of Civil Procedure, Probate Practice etc.), it is important to have prepared your opening and closing statements (to the extent possible), have prepared the necessary law regarding the substantive issues in dispute (casebook, factum), have addressed costs submissions (organizing offers to settle, preparing a Bill of Costs etc.), and have a trial binder with you at trial for your own use. 

A trial binder may contain the pertinent materials that you would like to have at your fingertips during the trial (ie. pleadings, orders, witness lists, witness summaries, answers to undertakings, listing of the types of evidence, objections, offers to settle etc.). The trial binder will allow you to have quick access to information that you might only have a few minutes or less to locate and quickly review. 

While most contested passings settle at a pre-trial stage, if a trial is necessary, success may hinge on the preparedness of the parties.

Thanks for reading.

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

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On Monday, I blogged on proving a lost or destroyed will in court:  If an original will which was last traced into the possession of the testator cannot be located following the death of the testator, a rebuttable presumption arises that the testator destroyed the will with the intention of revoking it.

However, there is an additional or complicating factor worth considering. What happens when the testator regrettably looses his/her mental capacity to make, change, or revoke a will? In these circumstances, where a party alleges that the will was revoked by being destroyed by the testator when of sound mind, the burden of proof rests on the party alleging the revocation. The presumption of revocation does not apply. The party alleging revocation must satisfy the court that it is more probable than not that, while of sound mind, the testator revoked the will by destruction. 

Rebutting the presumption of revocation or proving that the testator revoked his/her will by destruction where testamentary capacity is an issue can be difficult. It is obvious that proof of a lost or destroyed will is fact driven. No matter what position a party may advance in court, they will have to ensure that the proper evidentiary base is established to carry the day.

Thanks for reading.

Justin

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Pursuant to section 79 of the Substitute Decisions Act, the court has discretion to order a capacity assessment of an individual if the person’s capacity is an issue in a proceeding under the SDA. The court must also be satisfied that there are reasonable grounds to believe that the person is incapable. 

Where a capacity assessment has already been obtained, the court will be reluctant to order a further capacity assessment of an individual, unless the court has, for example, concerns about the lack of detail or objectivity within the assessment that has already been obtained. 

In Forgione v. Forgione, the court was concerned about the adequacy of the assessment carried out by a medical doctor. The court did not know what background information the doctor had or what, if any, influence anyone other than one family member may have had on the process. The report was very brief and consisted largely of conclusions without analysis. There were a number of facts and conflicting versions of facts which, in the court’s view, warranted further examination because they raised questions about the capacity and vulnerability of the incapable. A second assessment was ordered.

In Mesesnel (Attorney of) v. Kumer, Greer, J ordered a second assessment. It was the attorney’s position that the doctor had taken a strong personal dislike to him and that such dislike had influenced the doctor and affected the doctor’s objectivity. The doctor had originally been ordered by the court to prepare one comprehensive report; instead he prepared three separate reports which he made available over a three-month period. Moreover, none of the standard tests, except the Folstein test, was employed by the doctor, regarding the capability of the person to manage his affairs. The doctor’s criticisms of the attorney throughout the report were enough, in the court’s view, to raise the suspicion of bias in his reports.

While Greer, J. was aware that an assessment could cause the incapable some anguish, she was of the view that it was essential to have a second assessment in order that there be full and fair medical and neurological data before the court when the issues were determined.

Justin.

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I recently blogged on the lasting legacy of Cecil Rhodes. Along the same lines, the life of Alfred Nobel is worth considering.

Like most “great men”, Nobel was a bundle of contradictions. He was a successful Swedish business who is best remembered for inventing dynamite. However, he was a committed pacifist who wrote plays and novels - none of which are particularly remarkable. It was the world’s good fortune that a newspaper mistakenly printed Nobel’s obituary calling him the “merchant of death”. Nobel was horrified and turned his mind to creating a lasting legacy of peace. When he died in 1896, 94 percent of his substantial fortune went to fund an award for those whose work “conferred the greatest benefit to mankind” in physics, chemistry, medicine, literature, and peacemaking. In 1969, economics was added as a separate category. 

Not surprisingly, Nobel’s relatives were not happy. The vague wording of his will gave them the opportunity to tie up Nobel’s estate for years in the Swedish courts. However, on the fifth anniversary of his death, the first Nobel Prizes were presented by the King of Sweden. At the time, the monetary award that accompanied the Nobel Prizes was a vast sum ($42,000). The prize is now worth close to a million dollars today. Nobel laureates are highly regarded and many are household names. It is no exaggeration to boast that the Nobel Prize is the most prestigious award in the world and a lasting legacy from the man who invented dynamite.

Justin

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Welcome to my week of blogs.

The Substitute Decisions Act is silent when it comes to the issue of compensation for personal care guardians. Section 40 of the SDA addresses compensation for property guardians, but there is no corresponding provision for personal care guardians (though regard can be had to section 68(4) of the SDA). 

I was recently before Brown, J. in Toronto Estates Court in respect of a request for compensation by a personal care guardian (the decision is not yet reported). The property guardian, who I represented, supported the request for compensation, but the PGT questioned the amount requested and wondered whatever happened to “natural love and affection”.

In coming to his decision, Brown, J. applied the analysis set out in Cheney v. Bryrne, which he found was applicable to claims for compensation by personal care guardians. Brown, J. also applied, by analogy, the approach applied by the court to claims for compensation by property guardians. The test regarding the reasonableness of compensation claims was set out in Re: Brown (1999), 31 E.T.R. (2d) 164 (link not available). 

According to Brown, J., the evidence before him clearly demonstrated that the incapable needed the services provided by the personal care guardian. He was also satisfied that the personal care guardian was providing the services to the incapable with care and devotion and that her services were of a high quality and went well beyond what was ordinarily expected. Moreover, the incapable obviously could afford to pay for the services (not an insignificant factor). In considering the level of compensation, Brown, J. was satisfied that the amount claimed was reasonable and in the best interests of the incapable. He therefore approved the compensation claimed.

Thanks for reading. 

Justin

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"Your worth consists in what you are and not in what you have." --- Thomas Edison

Considered one of the most prolific inventors in history, Thomas Edison held over a thousand U.S. patents in his name (click here for a full list of all 1,093 patents).  Incredibly, when awarded the Congressional Gold Medal in 1928, Edison's work was valued at nearly $16 billion.

So how could the man who invented the phonograph, incandescent light bulb, motion picture camera, the stock ticker and the alkaline battery amongst others, possibly have died a comparatively poor man?  When he died in 1931, his estate was worth about $12 million, but most of this was buildings and equipment in his labs and factories.

In the January 1932 issue of Modern Mechanix, Remsen Crawford, biographer and personal friend, reported that Edison had revealed that his many patents never made a fortune for him, rather his income was primarily derived from his activities as manufacturer.  Edison went on to explain that U.S. government patent protection expires after 17 years, but in the case of such great inventions, someone always steps forward to challenge the real inventor's right to his patent.  Edison spent a lot of money in court trying to establish his claims to his inventions.  In fact, Edison indicated that he spent more defending his patents in court than he had ever derived from them on a royalty basis.

As so eloquently summed up by his good friend Henry Ford:  "He was not a money-maker...his own portion was a mere nothing compared with the wealth he created for the world."

David M. Smith

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Listen to Tracking Down Heirs

This week on Hull on Estates, Diane Vieira and Rick Bickhram discuss the issue of when an estate trustee is responsible to search for potential heirs to an estate.

Comments? Send us an email at hull.lawyers@gmail.com, call us on the comment line at 206-350-6636, or leave us a comment on the Hull on Estates blog.

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The superrich likely have the market cornered when it comes to epic estate battles - Howard Hughes, J. Howard Marshall (i.e. Anna Nicole Smith), and E. Howard Hunt (of silver fame) - quickly come to mind.

However, even the mildly famous or sainted can have their moment in the estate spotlight.  Recently, Luciano Pavarotti's family was in the news when a dispute arose among his offspring in respect of his considerable fortune.  They have apparently reached a settlement.

I also read with interest a recent US newspaper article indicating that two of Martin Luther King's children had filed a lawsuit against a third regarding a dispute over the civil rights leader's estate (J. Edger Hoover would have loved it).  Bernice King and Martin Luther King III filed a lawsuit in Atlanta in order to force their brother, Dexter King, to open the books of their famous father's estate.

From what I understand, the lawsuit claims that Dexter King, who is the executor of his father's estate, has refused to provide his brother and sister with documents concerning the estate's administration.  The lawsuit claims that Dexter King and the estate "converted substantial funds from the estate's financial accounts…for their own use".  The siblings were never told beforehand and are now seeking financial records and other documents in order to investigate the administration of the estate. 

Martin Luther King's "dream" seems to have stalled when it comes to sibling rivalry and the fortunes of his estate.  However, on a more serious note, the dispute once again reminds us of the importance of transparency in the administration of an estate and open communication between executor and beneficiary.

Thanks for reading.  Auf Wiedersehen

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Last night, I overheard a distressed woman confiding to a friend about a relative who was declared incapable of managing her property. The Public Guardian and Trustee (“PGT”) had stepped into her shoes to take control and to care for her property. This case peaked my curiosity, so I went home and did some research on this topic. 

Pursuant to Section 15 of the Substitute Decision Act (“SDA”), the PGT can be declared a person’s statutory guardian of property where a certificate is issued under the Mental Health Act (“MHA”) certifying that a person who is a patient of a psychiatric facility is incapable of managing property. Whenever a patient is admitted to a “psychiatric facility”, as defined by the MHA, a physician examines the patient to determine if he or she is capable of managing property. If the physician determines that the patient is not capable of managing property, then he or she must issue a certificate of incapacity. The certificate is subsequently sent to the PGT. As a result, Section 15 is triggered and the PGT steps in as the statutory guardian without any procedural requirement.

Pursuant to Section 16 of the SDA, the PGT can be declared a persons statutory guardian of property where a person requests an assessor to perform an assessment of either their capacity or another person’s capacity. This assessment is done with the view of determining whether the PGT should become the statutory guardian’s of the property. If a person wishes to request that an assessor perform an assessment of another person’s capacity, the person requesting the assessment must: (i) have reason to believe that the other person may be incapable of managing property, (ii) have made reasonable enquiries and have no knowledge of the existence of any attorney under a continuing power of attorney, and (iii) have made reasonable enquiries and have no knowledge of any spouse, partner or relative of the other person who intends to make an application for the appointment of a guardianship of property.

Thank you for reading and I hope my blogs added extra flavour to your favourite morning beverage. 

Rick Bickhram

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A widow in the United Kingdom is suing her two children, her one-year-old son and three-year old-daughter, over her late husband’s estate.  Taryn Dielle launched an action in London’s High Court claiming that the country’s intestacy laws do not provide her with enough money to care for her children.

Her husband, a London millionaire, died in 2007 without leaving a Will.  As he died intestate, his estate, worth about £2,231,201 (approximately 4.5 million dollars), was distributed in accordance with the United Kingdom’s intestacy rules. According to those rules, Ms. Dielle is to receive the statutory legacy and £50,000.00 ($100,000) per year in interest from her late husband’s estate, while her two children inherit the rest of the estate.

The United Kingdom’s intestacy rules provide that when someone dies intestate, leaving a spouse and issue, the surviving spouse receives all personal chattels, a lump sum of £125,000 (just over $250,000 dollars) referred to as the statutory legacy, and a life interest in one half of the residue. The surviving spouse can only receive the interest from the residue and cannot encroach upon the capital. The issue of the Deceased receive one half of any excess over the statutory legacy and ultimately they receive the other half of the residue when the surviving spouse dies. To contrast the UK law with Canada’s intestacy succession law, please read David Smith’s blog on intestacy distribution.

This will be an interesting case to follow and is already being referred to as an example that highlights the importance of estate planning.

Thanks for reading,

Diane Vieira 

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Once in a blue moon I find myself considering and marveling at the genius and breadth of the Common Law.  I am amazed by the Common Law’s ability to function effectively in what otherwise appear to be remarkably different parts of the world, particularly in the area of Estates and Trusts.

Of course, this phenomenon is a historical after-effect of the size and reach, particularly in the 17th to and 19th Centuries, of the British Empire.  Military history buffs will know this was largely attributable to the Royal Navy’s increasing dominance over the oceans of the world.  During that time (and before), the Common Law spread from the relatively tiny islands of the UK to vast and diverse areas: from India, Hong Kong, parts of Africa and Singapore to tiny island states in the Caribbean such as Barbados, the list goes on and on.

No doubt Estate Law has its local variants in each location, but I am more often than not struck by the similarities.  The attached article about Wills and Probate in Hong Kong would not be much different in Ontario, and I expect most non-lawyers would be hard-pressed to spot the differences.  Here’s a website encouraging people to outsource legal services to India, including trust deeds, although to my mind that may exaggerate the cross-jurisdictional similarities of Estates law. It seems to me it would still be best to retain a local lawyer in whatever jurisdiction you’re dealing. For the truly exotic, review this website talking about how the governing Estate law in Singapore shifted from the Common Law to Islamic law.

With Canada’s direct reliance on British jurisprudence lasting until 1949 when final appeals to the Judicial Committee of the Privy Council were ended, we certainly have played our role in this pattern and continue to do so.

Thanks for reading.

Sean Graham

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Whether voluntary or mandatory, mediation is now a common occurrence in estate and trust litigation. Much has been written and blogged on the subject. I therefore thought it worthwhile to comment on the changing nature of the plenary session from a practioner’s point of view. 

Traditionally, the plenary session brought the parties and their counsel together at the outset of the mediation so that the mediator could review the ground rules or “rules of engagement”, discuss the benefits of reaching a mediated settlement, and touch upon role of the mediator during the process. Counsel were then invited to present their client’s case usually adopting an adversarial stance and focusing on a “rights-based” approach to the mediation.  Next up were clients who, understandably, often became angry or confrontational.  

However, plenary sessions have largely changed. It is now widely recognized that allowing counsel and parties to make opening statements only inflames the situation and places the focus on what divides the parties rather than what unites them. Consequently, the mediation is off to a poor start and the mediator spends considerable energy unwinding the newly minted ill-will. 

Given the above, a plenary session should, in my view, consist of the following:

·          A brief discussion by the mediator of his/her role as well as the ground rules for the day;

·          An emphasis on why it is in the parties' interest to resolve the dispute at the mediation rather than later on within the court process;

·          An overview presented by the mediator of the outstanding issues and disputed facts; and

·          Constrained input from the parties.

In my experience, when a mediator takes the lead during the plenary session and canvases the legal and factual issues that divide the parties, while being sensitive to the emotional context in which the dispute is being waged, the parties are more likely to focus their energy on reaching a settlement. In the end, raw emotion does not simply trump common-sense.

Finally, it is worth noting that the vast majority of legal disputes settle before trial. Furthermore, statistics indicate that a settlement, or partial settlement, occurs more often than not at mediation. Viva la mediation.

Until tomorrow!

Justin