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. 

Enterprising Brits may have been hoping their estates would pay inheritance tax based on the purchase price of their wine cellars while the appreciation in the wine cellar would be passed on tax-free to the beneficiaries.  Alas, this is apparently not the case in England: Her Majesty's Revenue and Customs ("HMRC" as they call it over there) are aware that wine can appreciate, therefore wine is not a wasting asset valued at its purchase price, and the wine cellar must be valued at its open market value for inheritance tax purposes.   

While wine cellars may not have favourable tax treatment, at least in England, it strikes me as the sort of asset that may pass outside of probate more often than not.

Thanks for reading,

Chris M. Graham - Click here for more information on Chris Graham.

Many jurisdictions contain dispensation clauses relaxing the formal compliance requirements, if the court is satisfied that a document or any writing on a document embodies the testamentary intentions of a deceased.  For example, s. 23 of Manitoba's Wills Act  or California's Probate Section 6110-6113.  Not so with Ontario, except for holograph wills and for members of the Canadian Forces on active service.  While there is wiggle room in terms of the interpretation of the execution requirements, for instance what constitutes "in writing" or "signed by the testator", if the formal requirements are not met and no specific exemption applies, there is no saving provision based on testator's intention, and therefore no testamentary instrument.

This can have harsh consequences, by invalidating otherwise perfectly good wills on narrow technical grounds.  On the other hand, the SLRA provides time-tested, black-letter legal clarity.  Time tested, because the formal requirements descend from the Wills Act, 1837.

Have a great weekend,

Chris Graham

Christopher M.B. Graham - Click here for more information on Chris Graham.

The answer is: forget about cars, dvd players and even robots.  Funerals are very, very big business in Japan.  According to this Bloomberg article, the Japanese funeral industry is worth US$18 billion.   Last year, 1.14 million Japanese died, and funeral companies charge about $26,094.62 per funeral.  By 2040, 1.66 million will be dying every year.  Future growth is in death, and as Bloomberg notes, "everyone from railway companies to retailers wants a slice."   Funeral companies are stampeding towards Japan.

Unfortunately, things won't be so rosy in Canada.  This is because Japanese funerals are mostly Bhuddist funerals, which are elaborate multi-day events involving chanting monks, flowers, meals, cremation ceremonies, jade urns and the like.  They are elaborate, exhausting events.  Our funerals are fast-forwarded commercial breaks by comparison.  But it is still a glimpse into the future.

Have a great weekend,

Chris Graham

Christopher M.B. Graham - Click here for more information on Chris Graham.

Revival means reactivating a revoked will.  Note that section 19(1) of Ontario's Succession Law Reform Act requires a revival to be in accordance with the provisions of Part I of the Act.  So an oral declaration that a revoked will is valid does not suffice.  A destroyed will cannot be revived, unless the reviving instrument contains a copy or the terms.  On the other hand, at Common Law, a codicil referencing an existing will "republishes" that will, furnishing evidence of the testator's considering his will as then existing.  And because the Wills Act, 1837 did not abolish the doctrine of republication, the principle still operates.  Both revived and republished wills are deemed executed on the revival or republication date. 

An attempt to revive a will that was never actually revoked may have the result of republishing that will at the time of the attempted revival.  However, attempting to republish a revoked will not revive a revoked will, unless the acts of republication also satisfy the requirements of a revival (which include the form requirements of the Succession Law Reform Act.  Specific uses of the doctrine of republication are discussed in detail in Macdonell, Sheard and Hull on Probate Practice, 4th ed., Rodney Hull, Q.C. and Ian M. Hull (Carswell: Toronto, 1996), pp. 116-119. 

Have a good day,

Chris Graham

Christopher M.B. Graham - Click here for more information on Chris Graham.

A recent example of Rule 48.04(1) barring a motion for interim preservation occured in Trapukowitcz Estate v. Royal Bank of Canada.  In this case, an estate trustee was seeking an order that the proceeds of a GIC and a bank account be paid into court pending determination of ownership.  Justice Harris refused to grant leave to bring the motion because, on the basis of the admissible evidence, the estate trustee had not shown a substantial or unexpected change in circumstances. 

Justice Harris followed Machado v. Pratt & Whitney Canada Inc. (1993), 16 O.R. (3d) 250, which requires strong affidavit evidence to demonstrate a "substantial and unexpected change in circumstances to the extent that to refuse the order would be manifestly unjust".  The grounds in the moving estate trustee's affidavit were unconvincing. 

As importantly, viva voce evidence given in submissions was not considered.  To do so would be unfair to the respondent, particularly since the evidence had been available since June 4, 2009 and the hearing took place in August 6, 2009.  Therefore, Justice Harris cited Rule 37.06(b), which stipulates that every notice of motion must state the grounds to be argued, and refused to consider the viva voce evidence. 

There is no requirement under Rule 45 to prove the assets are actually at risk, so a R. 45 freezing order is easier to get before the close of pleadings.

Enjoy your day,

Chris Graham

Christopher M.B. Graham - Click here for more information on Chris Graham.

One criterion I use to rate general texts is how helpful or interesting they are to me in areas outside my field.  This book scores well on that basis.   See, for instance, the section on deductibility of legal fees or health club memberships. 

This text is highly recommended.

And my Friday blogs are always short for you.

Enjoy the weekend,

Chris Graham

Chris M.B. Graham - Click here for more information on Chris Graham.

Mr. Wang's eldest son, Winston Wong (same surname, just different spelling), has applied to be appointed as the estate administrator in New Jersey.  According to an Associated Press report, last week a judge adjourned a motion made by one of Mr. Wang's daughters to dismiss Winston Wong's application on the grounds New Jersey was not the proper jurisdiction. 

Winston Wong also has been granted powers of attorney by Mr. Wang's wife, and he is applying or petitioning to be appointed her guardian (the reports go no further on this issue).  This is being contested by some other siblings.  The guardianship issue is less hashed out in the reports but with Mr. Wang's wife entitled to around 50% of her deceased's husband's estate if New Jersey's intestacy laws apply, what are the odds of that changing?   

There's enough money at stake to ensure every possible issue (or non-issue) gets litigated, across the globe. 

Have a great day.

Chris Graham

Chris M. B. Graham - Click here for more information on Chris Graham.

"The finding that purpose in life is related to longevity in older persons suggests that aspects of human flourishing—particularly the tendency to derive meaning from life's experiences and possess a sense of intentionality and goal-directedness—contribute to successful aging,".    

The study found a correlation between longevity and participant's level of agreement with 3 particular statements in a "Purpose of Life" questionnaire:

1. “I sometimes feel as if I’ve done all there is to do in life;”
2. “I used to set goals for myself, but that now seems like a waste of time;” and
3. “My daily activities often seem trivial and unimportant to me.”

Guess whether the correlation was positive or negative?  Or read the study here, when it becomes published (it's not posted yet, but this at least rates a reminder in Outlook) .  

TGIF and find purpose in your weekend.  You'll live longer.

Chris Graham

One particularly poignant story was reported in a Toronto Star article where a husband and wife, having lost their baby son shortly after his birth, contacted DNA2Diamonds to create an eternal memento to their son's too-short life. 

This being an estates law blog, I must spoil the tranquility by pointing out that for estates planners, there's potential for a new set of issues to grapple with.  Executors have general authority and discretion to deal with the deceased's body, subject to the usual bevy of qualifications and exceptions the Common Law generates.  How would this principle be applied in the case of a Will directing the creation of a precious gem from the testator's remains?     

Enjoy your week,

Chris Graham

To refresh: the classic estate freeze is a transaction involving a business-owning parent and his or her child.  The parent transfers the equity shares in the business to the child but retains control of the company through preferential shares ("prefs").  The prefs have a fixed redemption and liquidation value, so all capital growth is with the equity shares transferred to the child.  The parent "freezes" his own level of equity in the business, leaving future capital growth to the child.  The goal is to avoid the child receiving the equity in the company on the parent's death, because the capital gains tax liability would presumably have grown significantly.  Capital gains tax is payable when the parent transfers the shares under the estate freeze transaction, but presumably smaller than it would be on the parent's death.  

The problem is that an estate freeze during the transferor parent's marriage potentially removes assets from that parent's property for the purposes of the NFP equalization.  This can conflict with the philosophy of the NFP equalization payment, which is that marriage is a partnership and spouses' collective increase in net worth during the marriage should therefore be evenly divided between the spouses at the end of the marriage.  The parent's subsequent death or divorce can trigger a challenge by the spouse of the estate freeze. 

Among Mr. Feldman's points and recommendations:

• the form of the transaction and relevant documents is critical (see the paper for reasons)
• the solicitor must have a well-documented file and written instructions from the client, due to the risk of the transaction being challenged
• Declarations to Revenue Canada and financial institutions are not considered binding in family law
• a gift of shares under a corporate reorganization may not excluded where there is not family trust, but beware that sooner or later the leading cases may be overturned (with a plethora of qualifications and circumstances detailed in the paper)
• gifting shares or the cash to buy the shares are subject to numerous, complex considerations (no pun intended)

This barely scratches the surface of the summary and recommendations.  It is well-worth the read.  The entire Six-Minute Estates Lawyer 2009 program can be purchased here.

Have a good day,

Chris Graham

In Eblie v. Yankowski, [2007] M.J. No. 145, the court awarded costs against the solicitor personally where an affidavit contained irrelevant, scandalous, vexatious and frivolous.  It was not enough to simply type what the client wanted to say.  The solicitor was responsible for drafting and presenting the affidavit material, and had caused costs to be incurred without reasonable cause.  In this case, the costs incurred included a motion to expunge the impugned material. 

Further, the court made the interesting comment: "It is difficult to accept that these materials were not prepared and filed for an improper purpose, namely to prejudice the mind of the court against the opposite party. If their inclusion in the affidavit filed by the Petitioner was intended to gain undue advantage and to defeat the course of justice costs against counsel personally are clearly warranted."  

For those interested, section 96 of Manitoba's Court of Queen's Bench Act is nearly identical to section 131 of Ontario's Courts of Justice Act in creating jurisdiction to make discretionary cost awards.   Manitoba's Rule 57.01(1) is similar in all relevant ways to Ontario's Rule 57.01(1), and Manitoba's Rule 57.07 similarly imposes potential personal liabilty on solicitors.

Enjoy your weekend,

Chris Graham

Probate applications are refused where the application material raises legal issues.  Normally, the next step is to bring a motion for directions to have a judge rule on the legal issues raised by the application.  There is arguably no such thing as a "simple will"; even a modest estate can give rise to issues of the highest level of complexity.  Preparing motion materials for interpretation of a "simple will" can therefore be disproportionately expensive.

Can Rule 74.14(2) can apply to avoid the need for drafting motion materials?  Rule 74.14(2) states:

"Where, in the opinion of the registrar, the application and accompanying material are not complete or contain information on which the registrar has a doubt, the application shall be referred to a judge for determination."

The qualifying conditions for referral to a judge can be interpreted quite broadly.  The key to this provision is the absence of any requirement to bring a motion.  It would seem that a letter to the registrar is sufficient, citing this rule and requesting the matter be referred to a judge.  Of course, unanimity among the parties to the probate application is probably required, though not explicitly stated in the rule.  It probably also helps to be polite, since the language of Rule 74.14(2) is discretionary.

This useful rule is unlikely to be the subject of substantial litigation, since where an estate can bear litigation expenses, the usual course of a Rule 74.15 motion for an Order for assistance, or a motion or application for directions under Rule 75.06 will be preferred.   

Have a great day,

Chris Graham

According to virtually every news source in the British Isles, that's exactly what Sir Sean Connery is being accused of doing to his only son, Jason.  This shocking revelation appears to have been exposed by a former wife of the former 007 star, Diane Cilento.  The root cause may be Sean Connery's experience with really, really hard work reportedly as a barrow-pusher in Edinburgh's industrial sector (back when Edinburgh had an industrial sector), as a milkman, and other tough jobs prior to superstardom.  Sean Connery reportedly wanted Jason to develop a work ethic. 

Sean Connery's fortune is estimated at 85,000,000 pounds - about USD$170,000,000 - and his son Jason allegedly won't see any of it, according to Cilento, because Sean Connery has left him out of his Will.  Apparently, after a tough go of it in the 1980's, Jason works and even earns a successful living as an actor and film director in his own right. 

Perhaps the most interesting thing about this story is that a hugely wealthy and successful father forcing his son to get a job is a newsworthy story.         

Have a great day at work,

Chris Graham

In Canada (Privacy Commissioner) v. Blood Tribe Department of Health, 2008 SCC 44, the force is the Personal Information Protection of Electronic Documents Act ("PIPEDA") and the object is solicitor-client privilege.  Section 12 of PIPEDA grants the Privacy Commissioner express statutory power to compel a person to produce any records that the Privacy Commissioner considers necessary to investigate a complaint “in the same manner and to the same extent as a superior court of record”.  The issue in Blood Tribe was whether this conferred a right of access to documents protected by solicitor-client privilege.  The Court held unanimously that the broad grant did not contain the requisite specific express authority to override privilege.

The Court stated the rule that "general words of a statutory grant of authority to an office holder such as an ombudsperson or a regulator do not confer a right to access solicitor-client documents, even for the limited purpose of determining whether the privilege is properly claimed.  That role is reserved to the courts.  Express words are necessary to permit a regulator or other statutory official to “pierce” the privilege." 

The Court also noted that "while the solicitor-client privilege may have started life as a rule of evidence, it is now unquestionably a rule of substance applicable to all interactions between a client and his or her lawyer when the lawyer is engaged in providing legal advice or otherwise acting as a lawyer rather than as a business counsellor or in some other non-legal capacity."

Speaking of the Supreme Court of Canada, the law you're looking for just might be in the "unreported judgments" section of the Supreme Court's user-friendly website.  How does a Supreme Court decision go unreported?

Have a great day,

Chris Graham

Public administrators of estate monies appear to have lost around $20,000,000.  The place?  The Bronx, NY.  When a New York resident dies intestate (without a will), his or her assets are managed by these public administrators until there is a court-approved settlement.  This is roughly the equivalent of monies paid into Court in Ontario.  The investments are even overseen by a judge.  

Similar to Ontario, the monies ought to be invested in low-risk investments like Treasury bills.  But apparently that principle was ignored by the public administrators, who instead bought auction-rate securities, the market for which collapsed in February.   

The lesson?  First, nothing happens on a small scale in New York, not even in the Bronx.  Second, a "risky" investment means that one might lose money.  A tough concept to grasp?  Third, someone else always gets paid: see page 2 of the article.  Where there are investments to be made, there are fees to be paid. 

Luckily for the beneficiaries, it appears that ultimately the city (ie, the taxpayers) will pay, not the various estates' beneficiaries. 

Thanks for reading,

Chris Graham

Until that day, the fighting parents who appeared before Mr. Justice Quinn have been barred from court unless they obtain special leave.  Looking at the context, it's hard to argue they did not earn it: 25 court orders from 12 different judges over 7 years, three contempt motions, one suspended sentence, 12 different lawyers, 2000 pages of court filings. 

An apparent lack of respect for the rulings of the Court by both litigants was a factor in this extraordinary Order.   As Mr. Justice Quinn is quoted, "[b]oth sides have shown an inability to abide by court orders such that their access to this court should be restricted by the requirement to obtain leave." 

Mr. Justice Quinn is further quoted as saying "[t]he parties have gorged on court resources as if the legal system were their private banquet table. It must not happen again,".  It is easy to forget that courts are very expensive operations: rent, upkeep and salaries.  An hour before a judge in court is not cheap for society, whether or not the litigants are represented by lawyers.  As a purely editorial comment, it is heartening to see principled recognition of this fact.

The father, perhaps unsurprisingly given the reported facts, is apparently considering an appeal.

Enjoy the weekend,

Chris Graham

It all started when a few knights returned from their crusades to find that the "friends" to whom they had entrusted management of their feudal lands refused to return said lands.  There was no mechanism at law to force the new untrustworthy owners to return the land so the law courts could do nothing. 

Naturally, the irate knights went to the Lord Chancellor and "asked" for justice.  One can imagine the scene: the silk-gowned Lord Chancellor looking down at the length of his shoe, then up at a selection of battle-worn armored thugs with gauntlets tapping hilts on chipped swords, over at the foppish, yawning new land-holder, then down again at the length of his shoe.  Unsurprisingly, the knights who had nothing else to live for continually won in the Courts of the Chancellory and the concept of trustees and beneficiaries was born.  I wager that trial by ordeal would have reached similar results so this must have been fate at work.

Tomorrow some interesting case law, I promise. 

Chris Graham

Too bad the research shows that Living Wills may not live up to the hype.  According to a recent study by two University of California Irvine researchers, Professors Peter Ditto and Elizabeth Loftus, Living Wills appear to have serious defects.  One problem is that patient preferences change over time.  For instance, one tends to be more inclined against end-of-life treatments immediately after a hospital stay, but this changes with time.  Also, positive treatment results of family members make a patient more inclined to end-of-life treatment.  Many people who make Living Wills change their preferences but forget about their Living Will, or misidentify those preferences in the Living Will. 

Perhaps the most glaring weakness is that Living Wills do not appear to provide guidance  to surrogates who have read them.  According to the study, the accuracy of a surrogate who has read a Living Will in prediciting a loved one's treatment preferences is no higher than that of a surrogate who has not read the Living Will.  So a Living Will can be totally inconsistent with the patient's most recent intentions.   

Having a Living Will apparently makes both the patients and the surrogates feel better, so it's not all bad news. 

Have a safe day,

Chris Graham

The riddle of proving a negative is quite relevant to estates litigation because the star witness for the estate is usually, by definition, dead.  Fortunately, since estate trustees can't prove negatives, they don't have to.  Section 13 of the Evidence Act specifically addresses this scenario, requiring independent corroboration of evidence in claims against estates.   The provision is designed to prevent claims that consist of mere allegations, which are easy to make, difficult to refute and expensive to litigate.  There is a great deal of case law on what constitutes corroboration, the standard of proof and so forth but the provision is a great deterrent to frivolous claims.

It seems trite to say but the Act is worth a review, even for non-litigators.  It's full of counter-intuitive gems that are easily forgotten: for instance, section 9 the Evidence Act states that witnesses are not excused from answering questions tending to criminate them under any Act of the Legislature.   

Have a great day,

Chris Graham