The respondents were success at trial and sought their costs. The applicant, the Ukrainian Catholic Episcopal Corp. of Easter Canada (the “Church”), argued that no costs should be awarded and that the costs requested were, in any event, excessive.

The court recognized that in estate matters, issues frequently arose upon which “reasonable persons” could “reasonably disagree”. Ambiguity in a testamentary document was cited as one such example. The court held that where there were reasonable grounds for an application, costs should generally be paid by the estate.

However, in the case at hand, there was no dispute arising out of any mistake or lack of clarity or default of the testator. According to the court, the lack of evidence supporting the Church’s position ought to have been apparent from the beginning and certainly at the end of discoveries (a good reminder to counsel to write to clients at the end of discoveries to address the merits of the case). Given the allegations of misconduct, coupled with the lack of evidence, the court held that costs, on a partial indemnity scale, should follow the cause (loser pays the winner).

The fact that the Church was a not-for-profit organization carried no weight with the court. Moreover, even though there was no adversity of interest between the respondents, the court was satisfied, despite the arguments of the Church, that it was reasonable for the parties to be separately represented. The respondents were awarded their separate costs.

Thanks for reading and have a good weekend.

Justin

The plaintiffs in this case were three of the four children of the deceased. The defendants were the youngest child, and the child’s wife.

The evidence as considered by the court seriously called into question the capacity of the deceased. By 1996, the deceased was showing early signs of dementia. In 1998, he was found in his car, parked on a railway track. He was disoriented, and was taken to hospital. He was diagnosed as suffering from dementia. While in the hospital, he wandered away, and had to be returned by the police.

Following his diagnosis, he was released from the hospital and lived with the defendants at his home until his death in February, 2002 at the age of 86.

Shortly after his assessment in 1998, the deceased transferred his home to his youngest son. He also transferred his investment account. He then made a new Will wherein he bequeathed the whole of his estate to his youngest son. (In a prior Will, executed in 1992, he divided his estate equally amongst his four children.)

With respect to the transfer of the assets, the court did not rely on any consideration of the issue of incapacity, but rather, set aside a transaction on the basis of undue influence. The court found that the deceased was, as of 1998, in failing health and dependent on the defendants for his care and comfort. The court stated that against this background, the defendant must show that the deceased entered into a transaction as a result of his own free will and informed thought. The court found that there was a presumption of undue influence based on the deceased’s failing health, and also based on the fact that the defendants took steps to convince the deceased that his other children were attempting to take his money.

With respect to the validity of the will, the court found that the deceased was confused and disoriented, and was suffering from dementia when he executed the new Will in 1998. The Court found that there was reason to doubt the deceased’s capacity to make a new Will and, consequently, the onus shifted to the defendants to prove the deceased’s testamentary capacity on a balance of probabilities. The court found that the defendants had failed to prove that the deceased had testamentary capacity when he gave instructions with respect to his new Will, and when he actually executed his new Will.

(Actually, the onus of proving testamentary capacity is always on the propounder. More accurately, and as the court indicated in the decision, the existence of suspicious circumstances may rebut the presumption of capacity, thus requiring the propounder to prove knowledge and approval and testamentary capacity.)

As a result, the transfer of the property and the investment accounts was set aside, as was the 1998 Will.

Have a great day.

Paul Trudelle

Family Law Act Claims

Subject to a contract to the contrary, section 6(1) of the Family Law Act provides for the right of the surviving spouse to make an equalization claim against the assets of the estate.

Since the 1970s, a general statutory proposition prevails that the value of "family property" should be split up equally when the marriage ends, regardless of which spouse holds to the property.

With the coming into force of the Family Law Reform Act, 1986 (R.S.O. 1980, c.152 (repealed and replaced by the Family Law Act 1986, S.O. 1986, c.4)), Ontario established a deferred community of property regime, which added a new dimension in relation to its impact upon surviving spouses and estates of deceased spouses and other persons who have an interest in their estates.

The impact affected the rights of the estate of a deceased spouse and a surviving spouse, and had a serious impact upon the entitlement of other persons interested under estates of a deceased spouse.

Support of Dependants under Part V of the Ontario Succession Law Reform Act - Restriction on Testamentary Power

Since the early 1900s, legislators in the common law jurisdictions began to give to the court a discretionary power to order proper maintenance and support out of the assets of an estate in circumstances where the testatrix had failed to make adequate provision for the support of dependants. In Ontario, the Dependants' Relief Act, R.S.O. 1970, c.126 and the successor provisions of the Succession Law Reform Act, R.S.O. 1990, c.S.26, set out the statutory provisions whereby a testator's power to do what he or she wishes with his or her assets is restricted.

 In a future blog, we will continue to explore these important claims against an estate.

All the best, Suzana and Ian. --------