Listen to Knowledge Management
This week on Hull on Estates Paul Trudelle and Sharon Davis discuss Knowledge Management; what it is and how it can assist lawyers and clients.
If you have any comments, send us an email at hull.lawyers@gmail.com or leave a comment on our blog.
Listen to The Estate Trustee During Litigation
This week on Hull on Estates Megan Connolly and Craig Vander Zee discuss the topic of the estate trustee during litigation (ETDL). Their discussion is based off a paper Paul Trudelle prepared and spoke about at the Hull and Hull breakfast series on June 4, 2009. They look at the circumstances when you would need an ETDL, the procedure for appointing the ETDL and the powers and duties of the ETDL.
For more information on this topic, see:
Jordan Atin's article, The Estate Trustee During Litigation, in 'Estate Litigation' by Brian A. Schnurr. volume 2. 2nd ed. (Toronto: Thomson Carswell, 2000)
If you have any comments, send us an email at hull.lawyers@gmail.com or leave a comment on our blog.
Listen to Useful Clauses in a Will
This week on Hull on Estates, Paul Trudelle and Sarah Hyndman Fitzpatrick discuss various clauses in a will that may be useful in certain circumstances, such as carrying on a business, exclusion of illegitimates, or RESP's.
If you have any comments, send us an email at hull.lawyers@gmail.com or leave a comment on our blog.
Paul Trudelle: Hello and welcome to
Welcome to
Sarah Hyndman Fitzpatrick: Hi and welcome to another episode of
Paul Trudelle: And I’m Paul Trudelle. Hi Sarah, how are you today?
Sarah Hyndman Fitzpatrick: I’m great Paul, how are you?
Paul Trudelle: Very good. Enjoyed the long weekend.
Sarah Hyndman Fitzpatrick: Absolutely. It was wonderful. How about you?
Paul Trudelle: I did, yes. Did a lot of…it was very productive.
Sarah Hyndman Fitzpatrick: Excellent.
Paul Trudelle: We were talking about what we were going to podcast on today and we thought we’d talk about Will clauses that you often see but aren’t discussed in much detail or other Will clauses that you don’t always see that you may want to consider when drafting a Will or instructing a lawyer with respect to drafting a Will. So perhaps we could spend some time talking about these clauses or just scratching the surface with respect to some of these clauses, what they may mean, why you may want to use them and what they can do.
Sarah Hyndman Fitzpatrick: Sure, and you know, as you mentioned Paul, these are clauses that they don’t garner much attention but certainly they’re commonly utilized in Wills as well, so they’re important clauses but you don’t often get a lot of commentary on them. So we’re going to discuss some of those today.
Paul Trudelle: Right. One of the clauses that we often see or sometimes see in Wills deals with illegitimate children and that’s sometimes just put in without much discussion. Perhaps we can talk a bit about that.
Sarah Hyndman Fitzpatrick: Sure. The law in
Paul Trudelle: So you can put in a clause in your Will saying that children born outside of wedlock won’t form part of the defined class of children or other beneficiary.
Sarah Hyndman Fitzpatrick: Exactly and normally the clauses will go to elaborate that in the event you treat a child who is an illegitimate child and born outside of marriage, in the event that you actually treat them, a settled intention is often the terminology used as a settled intention to treat them as a child of a union or a marriage, that they actually will take. So that’s, you know, a typical clause that is included.
Paul Trudelle: And that clause, I understand, can go down the line as well. So you may have illegitimate children and child, but that child may have illegitimate children and that clause will apply to those grandchildren and so forth.
Sarah Hyndman Fitzpatrick: Exactly. And the other benefit to having that type of a clause in your Will is that it’s going to, I guess, relieve the onus on your estate trustee of searching down that class of beneficiaries as well, whereas if that clause was not there it would be incumbent upon them to make sure that they had sort of closed off all the classes of their inquiry when they were looking for beneficiaries. But if the testator’s intention is specifically set out that they intend to exclude those then that’s going to make their job easier as well.
Paul Trudelle: Right. So otherwise I understand they have to do those extensive searches or make inquiries with respect to illegitimate children and we’re often surprised…
Sarah Hyndman Fitzpatrick: Exactly.
Paul Trudelle: but there’s a lot of them out there.
Sarah Hyndman Fitzpatrick: That’s right.
Paul Trudelle: Another clause that we mentioned when we were preparing for this that you put into Wills I understand from time to time, is a clause that deals with Air Miles, specifically deals with benefits, bonuses like that.
Sarah Hyndman Fitzpatrick: That’s right. And that’s really a new clause that’s being incorporated in a lot of Wills now just based on all the loyalty programs that are available now. And you can often have a situation where the testator’s amassed a very significant quantum of Air Miles and it’s really worth, you know, considering if you’ve got a few hundred thousand Air Miles who you would want to be the beneficiary of those. And it’s certainly an asset of the estate and it’s not something that you want to go unrecognized so it’s really a simple clause but something that you would want to be mindful of and consider including in your Will.
Paul Trudelle: And again, that would just make it easier for the estate trustee to administer the estate and it deals with what can be a substantial asset.
Sarah Hyndman Fitzpatrick: That’s right, yeah.
Paul Trudelle: Speaking of making it easier for the estate trustee to administer the estate or maybe more difficult, we talked about specific clauses dealing with carrying on business by the estate trustee.
Sarah Hyndman Fitzpatrick: That’s right. Often the testator will want the business carried on, a business or corporation carried on after they pass away. So it’s really an issue, you obviously want to include a clause perhaps giving some discretion as to the estate trustee’s ability to delegate some of that authority perhaps to managers and so forth. It also is somewhat of an issue of who your estate trustee is going to be. It really makes it a little bit more appropriate to obviously consider someone that might have that business acumen as well.
Paul Trudelle: Right, I think that’s always a concern when you’re naming an estate trustee, is to their abilities or his or her skill sets and if there is a business to be carried on, then again that may…
Sarah Hyndman Fitzpatrick: Right.
Paul Trudelle: inform who you want it to be…
Sarah Hyndman Fitzpatrick: Right but certainly something to consider with the testator, you know, if it’s something, if they do have business interests, whether or not they want to clearly set out for the estate trustee what their expectations are, if they intend for that to be continued on after their death.
Paul Trudelle: Great. Another clause that deals with the estate trustee and particularly where they live is a clause dealing with the requirement that the estate trustee post a bond if they’re outside of
Sarah Hyndman Fitzpatrick: That’s right and it’s not binding, we’re still going to need to make the Court application asking the Court to dispense with the necessity to post a bond. But it certainly is useful, perhaps in the situation where you think that your estate trustee who may presently be resident in Ontario may move to another province in Canada and you want to make it clear when your estate is administered to the Court that you had contemplated this situation and that you didn’t necessarily expect for them to have to post a bond. So that can be, again it’s not binding but it can be persuasive for the Court to look at and say that this situation was contemplated and you can dispense with that necessity, which can be very useful when you’re administering the estate.
Paul Trudelle: That’s great and it can save the estate significant funds as well.
Sarah Hyndman Fitzpatrick: Absolutely.
Paul Trudelle: And the headache of trying to get the administration bond, which can be difficult.
Sarah Hyndman Fitzpatrick: That’s right.
Paul Trudelle: Another clause we talked about that we wanted to mention was the Family Law Act clause that we see in most Wills now.
Sarah Hyndman Fitzpatrick: That’s right. You would want to make absolutely sure that that clause was included. As most people are aware, the inheritances are exempt from net family property but the income earned on that inheritance is not exempt. So unless you have a specific clause that excludes the income that’s earned on that inheritance, that can actually fall into the hands in terms of calculating the net family property. So it’s very important to have that in there.
Paul Trudelle: So just to explain that. So if I inherit money from a parent or a relative or someone else, that does not, the property that I inherit or the money does not form part of my property that would be subject to equalization if I was to divorce or separate or…
Sarah Hyndman Fitzpatrick: Well the inheritance would. The inheritance itself would fall into the net family property. But the income earned on that inheritance would not. So that would be available for them essentially. So what you’re trying to do by these Family Law Act clauses is exclude not only the inheritance, which is excluded at law, but also include any income generated on that inheritance. So it’s really casting the net wider in terms of the money that you’re able to exclude when you’re adding it or doing your net family property calculations.
Paul Trudelle: So that protects more of those assets in the event of a marriage breakdown.
Sarah Hyndman Fitzpatrick: It protects more of them; it protects the inheritance itself and the income.
Paul Trudelle: Wonderful. So that’s a clause to consider. We see that a lot…
Sarah Hyndman Fitzpatrick: That’s right.
Paul Trudelle: and it’s an important clause to put in.
Sarah Hyndman Fitzpatrick: Absolutely.
Paul Trudelle: RESPs are becoming more and more popular these days and we’re seeing more and more clients with RESPs, Registered Education Savings Plans.
Sarah Hyndman Fitzpatrick: That’s right, yeah.
Paul Trudelle: And what can we do in a Will to protect or deal with that asset?
Sarah Hyndman Fitzpatrick: Well certainly you want to give some guidance to your estate trustee. You’ve really got a couple of options. Do you intend for the payments to continue after your death? Or do you intend for your estate trustee to wind up the plan? Those are really your two options. Typically I find most clients are interested in continuing the plan for the benefit of their children. So you need to specify that in your Will and say that your intention is for the estate trustee to continue making payments. They would actually be…I think it’s called a successive subscriber to the plan. But they would be required to continue making payments to essentially continue the plan for the benefit of your children.
Paul Trudelle: Dealing with personal property. We see Wills that have clauses dealing with the specific bequests that are made. Often we see Wills that deal with personal property by way of attaching a memorandum.
Sarah Hyndman Fitzpatrick: Right.
Paul Trudelle: What other ways can we deal with personal property in the Will?
Sarah Hyndman Fitzpatrick: I find, you know as you mentioned, you’ve got the situation where somebody wants to attach a memorandum. And again, as we were discussing just before this podcast, we had a discussion about the use of whether what’s called a binding memorandum or a precatory memorandum. And if you include it in your Will, it’s actually a binding memorandum. There are other restrictions on what you need as well. The memorandum needs to be in existence before the Will is drafted. You need to specify it specifically in the Will and the date of it. So all those actually need to be in place. It actually needs to be described in enough clarity as well, so that it can be understood. Now if all of those factors are in place, that’s called a binding memorandum. I find that most clients typically are more interested in doing what’s called a precatory memorandum which you essentially just put a clause in your Will stating that any memorandum that I may leave I would like my estate trustee to have regard to. And the advantage of that is that as time goes on, you’ve got your Will drafted, you’ve got it in place but you can actually change your instructions in that memorandum. For example, if you acquire extra jewellery and you have a beneficiary in mind, perhaps you might give something away, it may no longer be in existence. So you can basically just draft a new memorandum and attach it with your Will. And again, that’s not binding on your estate trustee but it would be, you know, very strong evidence of your intention.
Paul Trudelle: So in that case, you would give the discretion to the estate trustee to distribute your personal property.
Sarah Hyndman Fitzpatrick: Exactly.
Paul Trudelle: Along with the non-binding or the precatory memorandum.
Sarah Hyndman Fitzpatrick: Right. Because people don’t always want to spell out everything in terms of personal property. It can get complicated and again we’ve got issues of ademption and issues where something may no longer be in existence. And it can lead to a lot of interpretation problems. So it’s fairly common to do, you know, some kind of a memorandum, be it a binding memorandum or a precatory memorandum.
Paul Trudelle: Okay. Well those are all useful clauses to consider. Even if you don’t use them, you should keep them in mind or think about putting them in, turning your mind to those points, I would think, when preparing a Will…
Sarah Hyndman Fitzpatrick: For sure.
Paul Trudelle: or instructing someone with respect to a Will.
Sarah Hyndman Fitzpatrick: That’s right.
Paul Trudelle: Well I hope that was helpful. It was a pleasure podcasting with you today.
Sarah Hyndman Fitzpatrick: You as well Paul.
Paul Trudelle: And if you want to contact us, please send us an e-mail at hull.lawyers@gmail.com. Be sure to visit our blog at estatelaw.hullandhull.com where you’ll find more information. And until next week, or the next blog, thank you for listening.
Sarah Hyndman Fitzpatrick: Thank you for listening. It was a pleasure podcasting with you Paul.
This has been
To listen to other podcasts, or to leave a question or comment, please visit our website at www.hullandhull.com.
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Listen to Administration Bonds
This week on Hull on Estates, Megan Connolly and Paul Trudelle discuss administration bonds; what they are, when they are required, why they are required and dispensing with the administration bond in certain cases. In Particular they refer to the Henderson decision, a recent decision out of the Ontario Superior Court of Justice that deals with the issue of dispensing with an administration bond and what is required.
Feel free to send us an email at hull.lawyers@gmail.com or leave us a comment on the Hull on Estates blog.
Administration Bonds - Episode #157
Posted on April 7, 2009 by Hull & Hull LLP
Megan Connolly: Hello and welcome to Hull on Estates. You’re listening to episode 157 on Tuesday, April 7, 2009.
Welcome to Hull on Estates, a series of podcasts for the Canadian legal community dealing with issues and insights surrounding estate planning in Canada. Hosted by the lawyers of Hull & Hull, the podcast will touch on some key considerations when planning estates and wills. Now, here are today’s hosts.
Megan Connolly: Hi and welcome to another episode of Hull on Estates. I’m Megan Connolly.
Paul Trudelle: And I’m Paul Trudelle.
Megan Connolly: If you want to be heard on Hull on Estates, you can participate by leaving us a comment. E-mail us at hull.lawyers@gmail.com or you can visit our blog at estate law.hullandhull.com.
Paul Trudelle: Hi Megan, how are you today?
Megan Connolly: I’m fine Paul. How are you?
Paul Trudelle: I’m good, thanks. And today we thought we’d spend a little time talking about administration bonds.
Megan Connolly: And exciting topic, I know.
Paul Trudelle: Yes, yes I’m excited. And we’re going to talk a bit about what they are, when they’re required, why they’re required and dispensing with the administration bond in certain cases. And in particular, there’s a recent decision that we’re going to refer to out of the Ontario Superior Court of Justice. It’s the case of Re Henderson that deals with the issue of dispensing with an administration bond and what’s required.
Megan Connolly: And that involved an application to dispense with the bond by an estate trustee who’d been appointed to an intestate estate, meaning there was no Will.
Paul Trudelle: Right. So normally an administration bond is required in all estates where there is a Certificate of Appointment being sought without a Will. If there’s no Will then the statute requires that you obtain an administration bond. That statute is the Estates Act and its section 35. An administration bond as noted Mr. Justice Brown in the decision that we’re referring to, which is Re Henderson, 2008 CanLII 69136, is the CanLII cite for it. He notes that administration bonds are required wherever a person died intestate. They are also required in other cases as well, such as a case where a Will exists but doesn’t name an executor; where there are foreign executors; or where there is a succeeding estate trustee with a Will not named in the Will.
Megan Connolly: Now there are a couple of cases where you don’t need an administrative bond, but that’s usually when the government is being appointed as the executor.
Paul Trudelle: That’s right. So if the Public Guardian and Trustee as we sometimes see is applying to be appointed as the estate trustee, then no bond is required. I guess its felt that they’re good for it.
Megan Connolly: I think trust companies don’t have to post either.
Paul Trudelle: Right and that’s a specific provision of the Loans and Trust Corporations Act. Trust companies don’t need to post a bond.
Megan Connolly: I think really they’re just trying to make sure the executor doesn’t run off with the estate.
Paul Trudelle: That’s right. And I think that’s the key here is that the purpose of the bond is to ensure that the work is done by the estate trustee properly and that all the debts of the estate are paid and that there’s proper distribution of the estate.
Megan Connolly: Now just because, I mean, a bond is usually required doesn’t mean it’s always required. And sometimes the executor or the Court will grant an Order dispensing with a bond. This may be the case where the beneficiary and the executor are one and the same. So if the sole beneficiary is applying, the Court is not going to ask for security before making the appointment.
Paul Trudelle: Right. And the Court has the discretion under the relevant legislation to dispense with the need for a bond or reduce the amount of the bond and they’ll do that in certain circumstances that you’ve mentioned. However the Henderson decision talks about what evidence is required by the Court before they’ll dispense with the bond. Just before we leave that point, though, I think there is specific provision that the Court will dispense with a bond where there is an intestacy and the certificate is being sought by the surviving spouse and the value of the estate does not exceed preferential share. That also requires that an Affidavit be filed setting out the debts of the estate.
Now in cases where that’s not the case and it’s still a small estate however, the Court can dispense with the bond. In the Henderson decision that we should turn to, deals with what the Court will need before they dispense with the bond. And in the decision, Mr. Justice Brown talked about the Affidavit that’s required.
Maybe just to back up a little bit. He also says that the purpose of this decision is to codify to a certain extent what’s required in order to dispense with the bond. He notes that in Toronto, the Estates Court and judges see up to two dozen requests for Orders dispensing with a bond, a week. And they feel that there’s no…
Megan Connolly: Wow.
Paul Trudelle: yeah, that’s a lot. That’s a lot. And those aren’t two dozen estates. Its two dozen estates where the bond is being dispensed with or sought to be dispensed with. And they get a lot of, I guess they had a varying degree of disclosure with respect to that. And a lot of these requests were being rejected. In order to reduce the rejection rate and ensure that all of the evidence is put before the judge in order to make the decision as to whether to dispense or not, Mr. Justice Brown sets out what’s specifically required in the Affidavit. And the Affidavit, if you follow the decision, should put all of the required information before the Court. The decision creates almost a checklist that all counsel should be referring to when preparing Affidavits to dispense with the bond.
And let me go through some of those points now.
Megan Connolly: Well they want to know the identity of all the beneficiaries of the estate. They also want to know if any of those beneficiaries are either minors or they’re incapable. If someone is a minor or is under incapacity, they want to know what the value of the interest is.
Paul Trudelle: Right. He goes on to say that you should file executed consents from all of the beneficiaries who are not under a disability and their consent to the appointment of the estate trustee and also to dispensing with the administration bond. If you can’t obtain a consent from all of the beneficiaries, then you must explain how you are going to protect the interests of those beneficiaries by way of posting security or otherwise.
Megan Connolly: And the Court is also interested in ensuring that all creditors have been satisfied. That all the deceased’s debts have been paid. And if there is anything outstanding still.
Paul Trudelle: That’s right. And that’s sometimes hard for an estate trustee to come up with when they first make the application. But I think it goes to show that the estate trustee must make inquiries in order to find out what the debts of the deceased are and whether they’ve been paid or not. If they haven’t been paid, then the estate trustee should make some proposal as to how they’re going to be paid, noting that the bond, if it was in place, would be to protect both the beneficiaries and the creditors of the estate. I think we missed one point. The last occupation of the deceased, you’ve got to put that in.
Megan Connolly: Okay.
Paul Trudelle: You have to go on and say whether the deceased operated a business at the time of his death, and if he did, whether there were debts of that business. So if there was a business that the deceased operated, you have to dig a little bit deeper and look at the debts of that business and what amounts may be claimed as against the estate.
Megan Connolly: I guess it’s also interesting to note ending off the reason that this was required was because there is actually nothing in the Rules of Civil Procedure which really speaks to how to dispense with the bond, once you’re through administering the estate.
Paul Trudelle: That’s right. And Mr. Justice Brown says that it may be an aware where the Rules Committee or the government may want to step in, in order to codify what’s required. But short of that, then his decision provides an excellent outline or guideline as to what’s required in order to dispense with the bond.
I think it’s important to note and we have a little bit of time left, that if you do have to post a bond, the normal requirement is that it’s twice the value of the assets under administration. So that can be a significant amount. I also know that its difficult to get a bond and you pretty much need to show the bonding company that you have assets as the estate trustee, that are sufficient or equal to the value of the bond that you’re getting, so that the bonding company has some protection knowing that if they have to pay out money to creditors or beneficiaries or to the Court under the bond, they’re going to have some recourse and be able to get it back from you as the estate trustee.
Megan Connolly: And the fact is, and I’ve seen this multiple times, that someone who otherwise would step forward to act as an executor, either can’t or sometimes just is unwilling to do it if it means having to post a bond.
Paul Trudelle: Right. And its, in addition to being hard to get, also a significant expense that needs to be incurred. I guess one of the recourses then, if you can’t get the bond or if its considered to be too expensive, is to turn over the administration to a trust company.
Megan Connolly: Yeah. Well I think that brings us to the end of this week’s discussion. Thanks for listening and thanks for joining me today, Paul.
Paul Trudelle: Well thank you Megan. That was very informative, I thought. Thank you.
Megan Connolly: And we look forward to hearing from our listeners. You can send us an e-mail at hull.lawyers@gmail.com. Be sure to visit our blog at estatelaw.hullandhull.com where you’ll find even more information and discussion on today’s practice of estate law.
We hope that you enjoyed the show. I’m Megan Connolly.
Paul Trudelle: And I’m Paul Trudelle. Thank you.
This has been Hull on Estates with the lawyers of Hull & Hull. The podcast you have been listening to has been provided as an information service. It is a summary of current legal issues in estates and estate planning. It is not legal advice and you are reminded to always talk with a legal professional regarding your specific circumstances.
To listen to other podcasts, or to leave a question or comment, please visit our website at www.hullandhull.com.
Our theme music is Upper Structure by DJ AKid and is courtesy of the Podsafe Music Network.
Listen to Amendments to the Rules of Civil Procedure.
This week on Hull on Estates Rick Bickhram and Paul Trudelle discuss the amendments to the rules of civil procedure that have be set out by the government and come into effect on January 1, 2010.
The purpose of these amendments is to provide the civil justice system with a means of being more affordable and accessible.
Feel free to send us an email at hull.laywers@gmail.com or leave us a comment on the Hull on Estates blog.
Amendments to the Rules of Civil Procedure - Episode #152
Posted on March 4th, 2009 by Hull & Hull LLP
Rick Bickhram: Hello, and welcome to Hull on Estates. You are listening to episode 152 on Wednesday, March 4th, 2009.
Welcome to Hull on Estates, a series of podcasts for the Canadian legal community dealing with issues and insights surrounding estate planning in Canada. Hosted by the lawyers of Hull & Hull, the podcast will touch on some key considerations when planning estates and wills. Now, here are today’s hosts.
Rick Bickhram: Hi and welcome to another episode of Hull on Estates. I’m Rick Bickhram.
Paul Trudelle: And I’m Paul Trudelle.
Rick Bickhram: If you want to be heard on Hull on Estates, you can participate by leaving us a comment. Please e-mail us at: hull.lawyers@gmail.com, or you can visit us at our blog at estatelaw.hullandhull.com.
Paul Trudelle: Yes, and thanks Rick, I thought we’d get right into our topic today and I thought we’d either talk about the Bank of Canada drop of interest rates from 1% to ½ % and the effect that that’s going to have on my mortgage negotiations. Or we could talk about the new Rules of Civil Procedure. What do you think?
Rick Bickhram: I think probably the Rules or the amendments to the Rules of Civil Procedure.
Paul Trudelle: Okay, that’s a great idea. Let’s get right into that then. There are new Rules of Civil Procedure that have been proposed, or set out by the government. They come into effect on January 1, 2010.
Rick Bickhram: I think its important to note that the purpose of these amendments were to provide our civil justice system with the means of being more affordable and accessible for all who, I don’t want to use the word participate, but who are into the system.
Paul Trudelle: Yes and I think that the rule changes tweak a number of existing rules in some important ways, all of which is designed to improve access to justice, keep the costs of civil litigation which can be quite high, to keep those costs down, if possible.
Rick Bickhram: When do these amendments come into place?
Paul Trudelle: They come into place on January 1, 2010. They’ll affect all proceedings, whether commenced on or before or after that date. So it’s important for everyone to know what those changes are and how they’re going to affect their proceeding, whether the proceeding is now in the works or whether it’s going to be commenced after January 1, 2010. They have quite a broad ranging affect and therefore it’s important to be aware of what those changes are.
Rick Bickhram: So I guess the first step is to talk about one of, I guess, the broader principles of the rules and the first one is going to be Rule 1.04(1.1) and the overarching principle of interpretation on this rule is that the Court shall make Orders and give directions that are proportionate to the importance and complexity of issues and the amount involved in the proceeding. I think the key here is to understand that proportionality is expressly required to be considered on all motions relating to discovery.
Paul Trudelle: Yes and this is the Rule 1.04, is the general interpretation of the rules and in that section there’s the requirement of proportionality in making any Orders. And it’s felt that this particularly affects the issue of discovery because that’s a very expensive part of the litigation process, so it’s important to know that there is that overarching principle of interpretation that the Courts will apply in making any decision substantive or procedural.
In addition, the Rule 1.08 also allows the Court to hear matters by way of telephone or video conference. Again, designed to keep costs down, the cost of attending at a Court hearing.
Rick Bickhram: And I think this rule kind of exemplifies the purpose of making it more affordable and accessible for all who are in the civil justice system because (a) it will loosen up some judicial resources; and (b) it should make it more affordable by reducing lawyer’s fees. We don’t have to necessarily attend every single motion now.
Paul Trudelle: That’s right. And it also reaches out to embrace the technology that we do have now with respect to telephone conferencing and video conferencing. And makes the Court more accessible by using that technology. We’ll see when we talk about the rules of electronic discovery that again there is reference to or an appreciation of modern technology and how it affects civil litigation.
So also I was saying the rules address to some extent the issue of discovery and a lot of the amendments tweak the discovery requirements and the obligations of the parties to make full and fair disclosure. And it also streamlines the discovery process with a view to avoiding what can sometimes be very costly disclosure requirements. One of the important rules there is that the Courts have changed what is needed to be disclosed. They’ve taken out the requirement that you disclose any document that has a semblance of relevance which is a very broad requirement and has replaced that with a requirement that you produce any documents not relating to a matter in issue but relevant to any matter in issue. So it fine-tunes that. It goes beyond requiring that the document relate to a matter in issue, but it has to be relevant to a matter in issue. We often see in estate litigation, for example, a number of documents that relate to a matter in issue but may not necessarily be relevant should the matter proceed to trial.
Rick Bickhram: And I think that’s again another important distinguishment and it goes back to the purpose of the rule which hopefully will reduce costs. We don’t necessarily have to comb through every single document now. We only look at the relevant documents. And it will thus make it more affordable for individuals to access our civil justice system.
Paul Trudelle: Yes.
Rick Bickhram: One of the interesting tweaks I’ve noticed about the discovery rules is the parties, I guess, pursuant to Rule 29.1, are required to file a discovery plan. And the plan (a) must be in writing; and (b) it must include the intended scope of any documentary discovery that’s to occur. What’s your view on that?
Paul Trudelle: Well I think that is going to get parties thinking at an early stage about the discovery process, what is going to be discovered, what is relevant to the matters in issue. Rather than just leave it open to discovery and have those issues come up at discovery, the parties must turn their minds to the discovery plan at an early date. It’s either 60 days after the close of pleadings or at the time they wish to obtain the evidence. So when you request the Affidavit of Documents, for example, before you do that, you must have this discovery plan. And you said that the plan has to be in writing, it needs to set out what the intended scope of discovery is so the parties need to look at what the issues are and what’s going to be relevant to that. The parties must go on to set out a timetable for the discovery process, dates for service of Affidavits of Documents, information on timing, the costs and the manner of production, address who is going to be examined for discovery, the place of discovery, the timing of the discovery, when they’re going to take place obviously, and also the length of the examinations.
Rick Bickhram: Another interesting tweak about the discovery rules is the Examination for Discovery. Under the new rules, no party is allowed to discover for more than 7 hours without the consent of the parties or a Court Order. And my understanding of this rule is that I call it the 7 hour rule, is in place regardless of the amount of witnesses that a party may have to examine. Is that correct, Paul?
Paul Trudelle: I understand the rules to limit discovery to 7 hours for each party. So each party would have 7 hours to examine the other parties. The rule specifically provides that no party may examine for discovery more than 7 hours, except with the consent of the parties or with a Court Order. And whether the Court will grant that Order will depend on the amount in issue, the complexity of the facts in law and the time that the Court expects would be reasonably required. The Court also looks at the financial position of each party, what financial resources they bring to the table and whether they are able to bear a longer discovery. Finally, the Courts will look at the conduct of any party. If there is conduct of one party that serves to delay the examination process or to drag out the examination process, then the Court may relieve against any injustice that may result from that. And the Court goes back to the overriding principle that we talked about earlier with respect to proportionality and I think that’s going to be particularly important or germane to the issue of discovery and the length of discovery.
Another important point on the principles of discovery is that the parties must consult and have regard to what has been referred to as the Sedona Canada principles of addressing electronic discovery. I did a little research into that. There is a document on the web and I’ll put the link on our website. The document entitled the Sedona Canada principles, which is a conference or a project that dealt with the issue of addressing electronic discovery. It’s quite lengthy and detailed however there is an executive summary which is quite helpful. It provides, just to summarize, that electronically stored information is discoverable. Steps to produce that information must be proportionate, again proportionate to the nature of the litigation and the dollar value. As soon as litigation is anticipated, a party must preserve potential electronic information. Counsel and parties are to meet and confer as soon as practical in order to identify, preserve, collect, review and produce electronically stored information. That information must be produced. A party shouldn’t be required, without agreement or a Court Order, to search for or collect deleted or residual electronically stored information. There are procedures set out for searching for information that may be relevant. And there is reference to reliance on electronic tools for searching. And the rule also addresses the costs of producing that electronic information and at first blush, the reasonable costs of preserving and collecting the information is to be borne by the party producing it. So if there is a case that deals with electronic information, just to wrap up this point, a party should address at an early stage and identify how that electronic information is going to be preserved and produced and used in the litigation.
So we won’t get into any more detail because our time is running short. The new rules alter the existing rules with respect to the…
Rick Bickhram: The following categories…
Paul Trudelle: Thank you. Summary judgment, mandatory mediation, listing matters for trials, extends the time with respect to service for motions and applications, deals with issues at pre-trial and how expert reports are to be produced prior to pre-trial, deals with new requirements for expert reports and what needs to be set out in the expert reports, specific proviso that expert reports must be non-partisan and must certify that they are aware of their duty to be fair, objective and non-partisan. There is an amendment to the Simplified Procedure, an increase in jurisdiction to $100,000. There’s also an increase in the jurisdiction of the Small Claims Court which is going to be increased to $25,000. We’ll put a link to the rules commentary and the new rules on our website so I think that it’s required reading for any litigator and should be important reading for anyone who may be involved in litigation in the coming months and years.
Rick Bickhram: Well I think that brings us to the end of this week’s discussion. Thanks for listening and thanks for joining me today, Paul.
Paul Trudelle: Thank you, Rick. I look forward to podcasting again.
Rick Bickhram: And we look forward to hearing from our listeners. You can send us an e-mail at hull.lawyers@gmail.com. Be sure to visit our blog at estatelaw.hullandhull.com where you’ll find even more information and discussion on today’s practice of estate law. We hope that you enjoyed the show. I’m Rick.
Paul Trudelle: And I’m Paul Trudelle. Till next week, so long.
This has been Hull on Estates with the lawyers of Hull & Hull. The podcast you have been listening to has been provided as an information service. It is a summary of current legal issues in estates and estate planning. It is not legal advice and you are reminded to always talk with a legal professional regarding your specific circumstances.
To listen to other podcasts, or to leave a question or comment, please visit our website at www.hullandhull.com.
Our theme music is Upper Structure by DJ AKid and is courtesy of the Podsafe Music Network.
Listen to Tucker and Tucker Estate Will Challenge
This week on Hull on Estates Megan Connolly and Paul Trudelle discuss a decision that was released on January 21, 2009 on the Tucker and Tucker estate, involving a will challenge.
The sole issue was whether or not this particular will was valid.
Feel free to send us an email at hull.lawyers@gmail.com or leave us a comment on the Hull on Estates blog.
Tucker and Tucker Estate Will Challenge - Episode #149
Posted on February 10th, 2009 by Hull & Hull LLP
Paul Trudelle: Hi and welcome to Hull on Estates. You’re listening to episode 149 on Tuesday, February 10, 2009.
Welcome to Hull on Estates, a series of podcasts for the Canadian legal community dealing with issues and insights surrounding estate planning in Canada. Hosted by the lawyers of Hull & Hull, the podcast will touch on some key considerations when planning estates and wills. Now, here are today’s hosts.
Megan Connolly: Hi, I’m Megan Connolly.
Paul Trudelle: And I’m Paul Trudelle.
Megan Connolly: And if you want to be heard on Hull on Estates, you can participate by leaving us a comment. E-mail us at hull.lawyers@gmail.com or you can visit our blog at estatelaw.hullandhull.com.
Paul Trudelle: And we always welcome your comments and questions or suggestions and we will respond to you as soon as we hear from you at either of those addresses.
Megan Connolly: So today we’re talking about a decision that was released, when was it, January 21, 2009 on Tucker and Tucker Estate and this involved a Will challenge.
Paul Trudelle: It was a Will challenge and it was interesting here because the Will was a formal Will executed by the deceased in front of witnesses, however the twist is that it was a Will that was prepared by a son of the deceased in his handwriting. Because it was duly executed before witnesses, it wasn’t considered a handwritten Will of the deceased. And the Court got into that as to whether it was to be accepted as a valid Will. That was the sole issue was whether the Will was valid.
Megan Connolly: So I guess by way of background, Mrs. Tucker, who was the deceased, was predeceased by her husband and survived by three sons. Now when her husband was still alive, she had made a Will leaving everything to him and saying if he predeceased her, then it would go to her three sons in equal shares.
Paul Trudelle: Right and that was in 1986. And then after her husband died, she re-did her Will with a lawyer. At that time, she appointed her one son, Richard, as her executor. And then she divided her residue amongst Richard as to 40%, William as to 40% and Donald as to 20%.
Megan Connolly: And the explanation at the time for this division, and this was in 1994 she did that Will, was that Richard and William were around more and took care of her and as a result, I guess, she just wanted to leave them a greater share of her estate.
Paul Trudelle: Right and that Will, the 1994 Will, went on to provide that Richard, the one son, was to be allowed to stay in the house for one year after death, assuming he paid all expenses. He was given a right of first refusal to purchase the property, at which time he would pay 60% of the appraised value, or he could rent out the house at a reduced rate with the proceeds being divided amongst the children upon sale as set out in the Will.
Megan Connolly: And at the time the 1994 Will was made, it’s worth mentioning that Richard, I guess, had other roles with respect to her property. She opened a joint account with him, so he could help her pay the bills. She named him as her attorney for property and she also designated him as the beneficiary on a life insurance policy.
Paul Trudelle: Right. Now time passed and we come up to 2004 and at that time, the testator made a new Will in which she changes the division of her estate. At that point she changes it so that rather than monies going to her son William, they’re going to go to William’s daughter as to the same percentages. And the reason for this was because William was on Social Assistance at the time and his entitlement would be affected if he was a beneficiary under the Will.
Megan Connolly: Okay, its worth mentioning at this time, she seems to be on good terms with all of her children. Richard and William were living with her and there’s nothing in the case to suggest that William was at all upset that Christine, his daughter, would be getting his share.
Paul Trudelle: That’s right, yes. More importantly here, or most importantly perhaps, that Will, the 2004 Will, the first 2004 Will, deleted the rights with respect to the property that were granted in the 1996 Will.
Megan Connolly: Yeah, and I guess the other notable thing, well I’ll tell you why in a minute, is this Will was done by a lawyer, who I guess presumably met with and taken instructions from her and then completed the Will.
Paul Trudelle: Yes. And shortly after that Will was made, the testator expressed some…it said that she expressed some issue with respect to the Will and another lawyer was called in to take instructions for preparing a new Will. And this other lawyer took instructions, however no formal instructions were received to complete a Will and he never opened the file and no formal Will was prepared by this other lawyer.
Megan Connolly: And it may be just worthwhile quickly mentioning what the issue was, although it’s not completely clear what the rationale was in the decision. Apparently Mrs. Tucker learned and was surprised by the fact that Richard had right to the house under the 1994 Will and this was very, very distressing to her.
Paul Trudelle: Yes, it said that learning that her son, Richard, had rights under the 1994 Will caused her great anxiety, stress and a violent angina attack. She was upset to learn about that and that led to her, it’s suggested, wanting to make changes with respect to her Will as it stood in 2004.
Megan Connolly: So around this time, things were stressful and of course, they were all living together and there’s some discussion in the case how the relationship started to break down. Of course, William was very, very suspicious of Richard and I think there were arguments and finally Richard, I think, moved out.
Paul Trudelle: That’s right. I think he moved out in May of ’04 according to the reported decision. Following him moving out of the house, William testified that he opened a new joint account with his mother and so he was made survivor of that bank account. He also says, William says, that he was unable to contact the lawyer who was contacted to prepare the Will. As a result of this, and in order to relieve his mother of stress, he took instructions from her and wrote a new Will for her and this led to the issue, the validity of that Will that was prepared by William, in William’s handwriting, and signed by the mother.
Megan Connolly: And in this Will, Richard was removed as a beneficiary and the estate was divided equally amongst Donald, the son and Christine, William’s daughter. And I guess the circumstances are interesting. As Paul said, William literally wrote the Will for his mother. He then, I guess, gathered witnesses, two close family friends to come to the mother’s house so she could sign the Will. And he video-taped the execution of the Will.
Paul Trudelle: And the video-tape here, I think, it’s important to note, was used by the Court and relied upon by the Court to find that the Will was duly executed. However the Court went on to make comments about the video-taping of the Will when it discussed the suspicious circumstances surrounding the Will and in fact the Court went as far as to say that the fact that the Will signing exercise was video-taped was in and of itself a suspicious circumstance. The Court states that if there were no concerns about health, capacity or influence, then there would be no video-tape. And the Court went on to state “to watch the video-tape is almost to watch a play”.
Megan Connolly: Right.
Paul Trudelle: So with respect to that execution of that handwritten Will that was signed by the testator, that becomes the issue in this lawsuit. It was challenged by Richard. Just as an aside, though, it’s interesting to note that it wasn’t Richard himself who was challenging the Will. Richard had made an assignment in bankruptcy and it was his trustee who was challenging the Will. The trustee in bankruptcy would receive the assets that Richard would be entitled to under the prior Will.
Megan Connolly: What I thought was interesting, though, is and it’s mentioned in the decision, the estate itself really wasn’t big at all. It said that it consisted only of the deceased’s principal residence and that had been sold for something less than $100,000. So given it appears that in the previous Will, Richard would have received what…about 40%. And when you look at the legal fees, he is looking at I guess a trustee in bankruptcy chasing after $40,000.
Paul Trudelle: Right but still we have this trial and I’m just trying to see how long the trial went. It was heard over 5 days in 2008. It was a 5 day trial that would come into significant cost. You would think that the costs would outweigh the benefits however I presume this is something that the trustee in bankruptcy had to pursue on behalf of the creditors of Richard’s estate.
So the Court looked at the evidence that we’ve discussed and went on to consider whether the Will was validly executed or not. It relied on the landmark decision of Scott and Cousins that sets out the principles that are relevant and they are ably summarized in that decision. The Court also turned to Section 13 of the Evidence Act which requires that evidence be corroborated and considered whether there was any corroborating evidence.
Megan Connolly: And that was a bit of a problem here because the only uninterested party who didn’t really have an interest in the outcome was one of the witnesses to the Will. And the Court said well sure, he came and witnessed the signing of the Will but he wasn’t privy to the preparation of the Will, he had no insights into the instructions she had given, the changes she wanted to make or why she would have done any of this. So the Court didn’t really find that his evidence had much in the way of probative value.
Paul Trudelle: That’s correct. The Court felt that the key time that they had to consider was when the Will was drafted rather than when it was executed. And it went on to consider suspicious circumstances that existed at the time the Will was made and the Court itemized a number of suspicious circumstances that would lead one to question whether this was in fact a valid Will.
Megan Connolly: So one of them had been that she suddenly made this Will excluding the child completely when in three previous Wills, she hadn’t done so.
Paul Trudelle: Right. And in point of that fact, one of the Wills was made just before she made this handwritten Will so the sudden change in circumstances raised an eyebrow.
Megan Connolly: Another issue was, of course, that she had that January 2004 Will where she had received legal advice. All of a sudden this new one Will comes in the absence of advice, when it was written by one of the sons and when it’s completely inconsistent with previous Wills.
Paul Trudelle: That’s right. And that son, William, was found to reside full-time with his mother and in his testimony, he was, it appears to have an interest contrary and was adverse to his brother, who was left out of the Will. The Court found that that must have created a negative household atmosphere that would have been apparent to the testator.
Megan Connolly: As far as the deceased’s physical health was, as mentioned before, she was in declining health. The Court also mentioned that she was on numerous types of drugs and other medication at the time the Will was drafted.
Paul Trudelle: Right and as a result of that, her son William, was around 24-7 according to the report and that would give rise to a possibility of undue influence.
Megan Connolly: And just going back to the issue of collaborative evidence, its worthwhile noting that Christine, William’s daughter, who was present when the Will was signed, and who was to receive 50% under the new Will, wasn’t called as a witness and that the Court mentioned without explanation really, that she was now estranged from her father as a result of these proceedings.
Paul Trudelle: Right and I think it’s important to note that it’s not always the evidence that you are able to call; it’s also the evidence that you don’t call and adverse inferences can be made. We mentioned the suspicious circumstance regarding the video-tape itself. The Court goes on to state that the Will was in the son’s handwriting and they found that that was suspicious. The son had explained that the mother wasn’t able to, wouldn’t be able to write out the Will herself, although it went on to find that her signature, according to the video-tape, was done quickly and easily and therefore she probably could have drafted the Will herself if that’s what she wanted to do.
Megan Connolly: Okay, so in case you haven’t figured it out by now, the Court found that this Will was not valid and that the earlier January 2004 Will was the valid Will.
Paul Trudelle: Yes.
Megan Connolly: So I guess that’s that.
Paul Trudelle: So it’s an interesting case to read as far as, you know, each of these cases always turn on their own facts. But this is a very unique fact situation, however it’s quite instructive with respect to the issues surrounding the validity of a Will, the test that the Court will apply and how the Court will analyze facts that give rise to suspicious circumstances.
Megan Connolly: Okay, well I think that brings us to the end of this week’s discussion. Thank you for listening and thanks for joining me today, Paul.
Paul Trudelle: Thank you Megan.
Megan Connolly: And we look forward to hearing from our listeners. You can send us an e-mail at hull.lawyers@gmail.com. Be sure to visit our blog at estatelaw.hullandhull.com where you’ll find even more information and discussion on today’s practice of estates law.
We hope that you enjoyed the show. I’m Megan Connolly.
Paul Trudelle: And I’m Paul Trudelle.
This has been Hull on Estates with the lawyers of Hull & Hull. The podcast you have been listening to has been provided as an information service. It is a summary of current legal issues in estates and estate planning. It is not legal advice and you are reminded to always talk with a legal professional regarding your specific circumstances.
To listen to other podcasts, or to leave a question or comment, please visit our website at www.hullandhull.com.
Our theme music is Upper Structure by DJ AKid and is courtesy of the Podsafe Music Network.
Listen to Testamentary Capacity Issues
This week on Hull on Estates, Paul Trudelle and Natalia Angelini discuss testamentary capacity issues as they arise in estate matters. Wills require the highest level of capacity and testators need to demonstrate that they are of a sound and disposing mind.
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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