Avoidable Legal Expenses in Estate Disputes

 

Its easy for legal expenses in emotional estate disputes to get out of hand. Some are surprised when I tell them that legal expenses can be in the hundreds of thousands of dollars. Although I generally associate expenses in that range with cases that go through a full trial, even without a trial, disputes can result in disproportionate expense. In some cases much of the expense can be avoided by forthright, early communication among the parties.

My point is illustrated by a recent assessment of lawyers’ bills in Mulder Estate, 2022 BCSC 406. This dispute was between the daughter of the deceased will-maker and her two brothers. The daughter, Leondra Ponnusamy, was named as the executor, and all three were beneficiaries of their mother’s estate. Her brothers, Ronald Mulder and Robert Mulder, asked for records of their mother, Alma Mulder’s bank accounts predating her death. Their sister refused, taking the position that as executor she did not have provide records of transactions that occurred before death. They claimed that she failed to repay $20,000 in loans. The also claimed that $35,000 that their mother had given to her was a loan, which she had to repay, rather than a gift, as she claimed. They further alleged that she received another $150,000 from their mom, and that she owed that amount to the estate.

Ultimately the dispute was settled out of court, after she did provide records, including records showing that she did not receive $150,000 and that she repaid the $20,000. But by then, the parties had incurred combined legal bills of about $300,000 in a $1.3 million estate. The sister had two lawyers involved, and the brothers had one lawyer.  

Although the Registrar did reduce the bills to some extent (25% for one lawyer, 20% for another and 5% for the third), the main point is that most of this could have been avoided.

Registrar Nielsen disagreed with the position the executor took initially that she had no obligation to provide disclosure of records prior to her mother’s death. She had a fiduciary duty, or in other words a duty of loyalty, to beneficiaries, and the circumstances called for full disclosure. Had she done so at the outset, the dispute could have been resolved with far less expense.

Registrar Nielsen wrote:

[63]         During the course of her evidence, the executor stated that she did not want her brothers seeing the per-death financial records as Ron and his wife Tammy had meddled in Alma’s finances while she was alive, and Alma had confided in Leondra that she resented this. Disclosure of the records would essentially be an affront to her mother’s memory. It is difficult to equate this stance with the definition and duties of a fiduciary provided by Dr. Waters [from Waters’ Law of Trusts in Canada, 4th ed].

[64]         In my view this was a case that cried out for full financial disclosure at the outset when it was first requested. The executor was both executor and beneficiary, and she had a pre-death history of receiving both gifts and loans from the deceased. Her relationship with her brothers had been fractured before she became executor, and Alma had indicated to Ron that Leondra was having financial difficulties. Mistrust in these circumstances was inevitable. It was not, in the words of Dr. Waters, “in the interests of the estate, or the beneficiaries” to withhold the financial information in these circumstances, from two of the three beneficiaries. 

[65]         When the executor is also a beneficiary, the fiduciary duty is particularly high when there is a pre-death history of loans and gifts to the executor by the deceased. She had a duty to identify and collect any unpaid debts owed to the estate. She alone had exclusive access to the financial records. Ron and Rob had no right to access those records without her consent, or court order. Without disclosure of the pre-death financial records, they were completely in the dark with respect to any debts owed to the estate, real or imagined.

[66]         As the litigation progressed needlessly, select financial records were disclosed, as the executor saw fit, to prove the allegations of the beneficiaries to be incorrect, or “false”, as submitted by counsel for the executor. Once disproved, the allegations were eventually withdrawn, although not as quickly as the executor would have liked.  

The brothers could also have brought an application to court to get the disclosure to get the documents early on.

What I find remarkable is that, although none of the parties were challenging their own lawyer bills, it took 24 days of hearing time for the bills to reviewed. We don’t know how additional expense the parties incurred arguing about each other’s lawyer’s bills.

Registrar Nielsen noted:

[72]         Following 24 days of evidence and argument in the within proceeding on what should have been the relatively narrow topic of legal fees, with the benefit of hindsight, there is no doubt in my mind that early disclosure of the financial records, when first requested, would have nipped the lion’s share of the subsequent litigation in the bud. The savings to the estate in legal fees would have been considerable. It may have also preserved what was left of the sibling’s fractured, but civil personal relationship.

Unconscionable Procurement: Pinsonneault v. Courtney

 

The doctrine of unconscionable procurement is a helpful tool in challenging gratuitous transfers if the person benefiting has been actively involved in procuring property from the transferor. When it applies, the person who receives the benefit has the burden of demonstrating that the transferor had a sufficient level of understanding of the nature and effect of the transfer for it to be upheld. To succeed in a claim of unconscionable procurement, it is not necessary to show that the transferor did not have the mental capacity to make the transfer, or that she was subject to undue influence. This doctrine is not new, but many of the cases are older, and the concept appears to be enjoying a renaissance in Canada. There is heightened awareness among lawyers, which I suspect is largely due to John Poyser’s insightful discussion of unconscionable procurement in his text, Capacity and Undue Influence (now in its second edition; I reviewed the first edition here). If there were any doubt about whether the doctrine still applies in British Columbia—and there shouldn’t have been—the recent decision in Pinsonneault v.Courtney, 2022 BCSC 120, confirms it is alive and well.

Marie Reine Denise Pinsonneault moved to British Columbia in 2010 following a breakdown of her marriage. She has six children, one of whom she believed would try to take whatever he could from her. She settled in the Kootenays, and had a small business. At the time of trial in 2020 and 2021 she was 87. She had very poor eyesight, no longer had a drivers license and was “not physically robust.” On the other hand, Mr. Justice Williams, who heard the trial, described her as a “feisty, active individual.” It is apparent from the decision that her mental functioning was fine.

She became good friends with a contractor she had hired to do some work, Terry Courtney, and also became friends with his wife, Charlene Courtney, and their daughter. Mr. Courtney was 63 at the time of trial, and he characterized their relationship as like mother and son. She disagreed with his characterization of their relationship.

She purchased a lot (“Lot 3”) with a cabin on Kootenay Lake for $150,000 in 2015.

According to Ms. Pinsonneault, in early 2017, Mr. Courtney told her that he and his wife found a way to protect Lot 3, in reference to her concerns that her family and particularly her youngest son might try to take it from her. This was through a power of attorney. He took her to a notary public, where she signed four documents, including a letter explaining that she wanted to add Mr. and Mrs. Courtney to the title of Lot 3, a “Deed of Gift” of Lot 3 to them, pursuant to which she was gifting the property to them, while she would continue to be responsible for the property expenses, a transfer to title into their names and a power of attorney. In the documents, Mr. Courtney was described as Ms. Pinsonneault’s “step-son,” which was, of course, not accurate.

Ms. Pinsonneault’s evidence of what happened at the Notary’s office is set out in the decision as follows:

[129]     The plaintiff testified that when they arrived, initially Mr. Courtney went and spoke privately with the notary, that is, not in Ms. Pinsonneault’s presence. She said that she then met privately with the notary. There were papers present, evidently already prepared. Her recollection is that the notary asked her if she had read the “paper I sign”; she replied that she “cannot read”. “The notary then asked “do you know what you are signing?” and she answered to the effect yes, that “Terry had explained it to her”. Ms. Pinsonneault said she then signed the papers that were presented to her; she paid the bill and left with Mr. Courtney. When they left the notary’s office, she said she had the papers in her hand. Mr. Courtney told her to give them to him, saying “I will put them in your file at my place”, but she refused to do so. She said she took them home and put them in her desk. She did not examine them at that time or until some considerable time later.

The notary gave evidence, but Mr. Justice Williams found that “her testimony was disappointing and inadequate. Her responses were a litany of claims that she did not remember any details or specifics of the transaction, sometimes falling back on her ‘general practice’.” Her “notes and file are of no value to her in providing clear and reliable answers.”

Ms. Pinsonneault and Mr. Courtney later had a falling out over a dispute about the removal trees from Lot 3. She testified that it was after this disagreement that she read the documents and found out that she had transferred Lot 3 to the Courtneys.

She sued to recover Lot 3.

In finding in favour of Ms. Pinsonneault, and awarding her the property back, Mr. Justice Williams applied the presumption of resulting trust, which is a presumption that applies when one person makes a gratuitous transfer to another, there is a presumption that the transferor did not intend to make a gift. If the presumption is applied, the transferee is said to hold the property transferred on a “resulting trust,” for the transferor.

The presumption of resulting trust is just that: a presumption. It may be rebutted by evidence that the transferor did intend to make a gift. The issue boils down to whether the transferor intended to make a gift when at the time of the transfer. The documents Ms. Pinsonneault signed, particularly the Deed of Gift, would on their face lend support for the view that she intended a gift when she signed the transfer. Mr. and Mrs. Courtney argued that she intended to make a gift at the time she signed the transfer, but she changed her mind later.

Mr. Justice Williams found that the Courtneys had not rebutted the presumption of resulting trust. Ms. Pinsonneault did not intend to make a gift nor did she even know she was transferring her property. He wrote:

[207]     That said, the presumption to which I make reference is rebuttable: it is open to the defendants to adduce evidence to displace the presumption. To do so, they must show on a balance of probabilities that the transferor (the plaintiff) intended to make a gift.

[208]     In the matter at hand, as I have explained in my discussion of the evidence, I find that, at the time of the transfer, there is no viable basis to believe that the plaintiff had the intention to gift title to Lot 3 to the defendants. In fact, the evidence provides a strong reason to conclude that the plaintiff did not know that by signing the documents, she had in fact transferred title.

[209]     This is not a situation where it can be argued that, when the plaintiff executed the documents, she understood the consequences of doing so.

[210]     Furthermore, I am satisfied that the plaintiff was unaware that title had been transferred until many months later and, when she realized, she immediately set up a hue and cry, expressing that. In the time that followed, she steadfastly persisted in that position.

[211]     In short, there is no evidence before this Court that can assist the defendants in rebutting the presumption of resulting trust.

Mr. Justice Williams also considered unconscionable procurement. He provides an excellent summary of the doctrine:

[187]     The doctrine of wrongful (or unconscionable) procurement is derived from the principle that where a donee obtains a benefit from a donor that in turn disadvantages that donor, the donee must prove that the donor had the “necessary level of understanding to make a transaction conscionable”: John E.S. Poyser, Capacity and Undue Influence 2^nd ed (Toronto: Carswell, 2019) at 629 in Gefen v. Gaertner, 2019 ONSC 6015 at para.158. It is an equitable principle: Poyser at 628. A finding of wrongful procurement renders a transfer voidable by the court: Gefen at para. 158.

[188]     The Court in Gefen provided that the onus is on the party attacking the transaction to prove on a balance of probabilities that: (1) a significant benefit was provided; and (2) active involvement by the person obtaining the benefit of the procurement: at para. 159. Once these two elements are established, it is presumed that the donor “did not truly understand what they were doing when they made the transaction.” Gefen at para. 159.

[189]     Once the presumption is established, the transaction is voidable and the Court must determine whether it would be unconscionable to let the transaction stand. As stated in Gefen at para. 161, at this stage,

[161]    …Both parties must adduce evidence about the donor's actual understanding of what she was doing. If the evidence does not come down on either side, the attacker will have failed to meet the onus and the transaction will stand: Poyser, at p. 570.

[162]    The attacker must ensure that there is enough evidence before the court in the final weighing to allow the court to conclude, as a finding of fact, that the donor failed to have a conscionable understanding of what she was doing when completing the transaction. This issue turns on whether the donor appreciated the effect, nature, and consequence of the transaction in a manner sufficient to render it fair, just, and reasonable: Poyser, at p. 574.

[190]     The question the court must ask is whether the donor “fully appreciate[d] [the] effect, nature and, and consequence” of providing gift: Kinsella v. Pask, 28 O.L.R. 393 at 400, 12 D.L.R. 522.

Mr. Justice Williams found (at paragraph 217) that “… the doctrine of wrongful procurement is, to my mind, met by the circumstances at hand.”

Jana Keeley Joins Sabey Rule

 

I am pleased to welcome Jana Keeley to our firm. Before joining Sabey Rule, she practiced estate and commercial litigation at a leading civil and commercial boutique firm in Kelowna. She will continue to handle estate-litigation matters, and will also be assisting clients with estate planning, estate administration and elder law.

While she has a stellar legal background, personally I am even more impressed by her previous occupation as a songwriter and musician. 

Land Owner Transparency Reports Must Be Filed By November 30, 2021

 

Registered owners of land held in trust and corporations and partnerships that own land in British Columbia have until November 30, 2021 to file a report with the Land Owner Transparency Registry. This is a requirement under the Land Owner Transparency Act. There are draconian penalties for failing to comply. Unfortunately, I am finding that most people are unaware of the requirement, and the British Columbia Government has done a poor job explaining the legislation. But there is some information available online here.

If you are holding land in trust, you may have to file a report, but there are some exemptions, such as land held in a trust that qualifies under the Income Tax Act as an alter ego or joint spousal trust. There is also an exemption for testamentary trusts (trusts created in a will). 

If you are a trustee holding land, or if you have company or are in a partnership that owns land, please consult with your lawyer.

Chichak v. Chichak

 

In Chichak v. Chichak, 2021 BCCA 286, the British Columbia Court of Appeal confirmed that a creditor who has registered a judgment against real property held in the name of a debtor cannot enforce the judgement in respect of an interest of another person who has an equitable interest in the property. This is so even when the equable interest is not registered on the title to the land. The creditor may only enforce the judgement to the extent of the debtor’s interest in the land.

Derek Chichak and his wife Jennifer Chichak bought real property together. The title was transferred to Ms. Chichak’s name and then later she transferred the title into Mr. Chichak’s name. Mr. Chichak was sued by two creditors, who registered their judgment against the property. Another creditor had a mortgage against the property and when mortgage went into default, the property was sold in a foreclosure proceeding brought by another creditor. After the amount of the mortgage was paid, there remained surplus funds from the sale of the property, and the two creditors with registered judgements sought to have the funds paid out to them. Ms. Chichak, however, claimed that she had a 50% interest in the equity in the property because of her contribution to the purchase price. When one person pays for or transfers property to another, there is a presumption that the recipient of the property holds the property, or in this case half of it, on a resulting trust for the person who paid the purchase price or transferred the property. Ms. Chichak claimed that because her husband held a half interest in the property in trust for her, his judgment creditors were only entitled to recover one-half of the surplus funds, with Ms. Chichak entitled to the other half.

The Supreme Court of British Columbia did not make any finding as to whether Mr. Chichak held an interest in the property on a resulting trust for Ms. Chichak, but held that even if he did, the judgment creditors were entitled to be paid first. Their judgment on the title took priority to Ms. Chichak’s claim. Ms. Chichak appeal.

Madam Justice Saunders in allowing the appeal held that a judgment creditor who registered the judgment against the title to real property could not enforce the receive a greater interest in the property than that held by the judgment debtor. This principle is referred to in Latin as “nemo dat quod non habet” which loosely translated means “you can’t give what you ain’t got.” If Mr. Chichak was only entitled to a one-half interest in the property, then his creditors can only take his half interest; they are not entitled to the other half interest if he holds it in trust for Ms. Chichak.

This common-law principle that a judgment creditor may only enforce a judgment to the extent of the debtor’s interest in property is supported by the wording of the Court Order Enforcement Act. Section 83 (3) (a) and (7) provides:

(3)   From the time of its registration the judgment forms a lien and charge on the land of the judgment debtor specified in the application referred to in section 88 in the same manner as if charged in writing by the judgment debtor under his or her signature and seal,

(a)     to the extent of his or her beneficial interest in the land,

….

(7)   A judgment creditor is not a bona fide purchaser for value.

 [emphasis in decision]

The creditors pointed to section 23 (2) of the Land Title Act, which provides that subject to certain specific exceptions the title “is conclusive evidence at law and in equity, as against the Crown and all other persons, that the person named in the title as registered owner is indefeasibly entitled to an estate in fee simple to the land described in the indefeasible title….” In other words, people dealing with the registered owner of real property are entitled to rely on the owner’s title. This protects, for example, buyers of property from the owner on title form others later claiming that the seller did not in fact own the property.

However, Madam Justice Saunders, noting the distinction between a judgment creditor and a purchaser, held that section 23 (2) of the Land Title Act does not apply:

[14]         By the registration system, all interests in the property that will affect a prospective purchaser for value are recorded in the register, with the intention that the true state of the title – of all the interests pertaining to the property – will be evident, subject to these few statutory exceptions, and a bona fide purchaser for value will take priority over the holder of an unregistered interest. Section 86(7) of the Court Order Enforcement Act, of course, explicitly provides that a judgment creditor is not a bona fide purchaser for value.

[15]         In my respectful view, the judge misapplied the Land Title Act by effectively equating a judgment creditor, a person who seeks to collect on a judgment in likely unrelated litigation, to the position of a person who has relied on the register in acquiring their indefeasible interest in the land. This would allow a judgment creditor to obtain greater recovery from the land than even the judgment debtor could derive. This result could be legislated, no doubt. However, in my view, it has not; the current legislation does not reach this far. The result, in my view, is contrary to decided authority presented to us but, it appears, not to the judge of first instance.

The Court Appeal ordered that the case be remitted to the Supreme Court of British Columbia to determine whether Ms. Chichak in fact had a beneficial interest in the property.  If she can establish her resulting trust claim, the judgment creditors will not be entitled to the funds representing Ms. Chichak’s share of the surplus proceeds from the sale.

Supreme Court of British Columbia Gives Effect to an Unsigned Draft Will During Covid-19

Getting wills signed during Covid-19 has been a challenge, especially for persons in retirement communities and care homes when visitors are restrictions. The process those of us who are estate-planning lawyers like to follow of meeting our clients in person to review the final drafts of their wills and act as one of the two witnesses has often been thwarted. No doubt many wills have gone unsigned for months, with the increased risk of death before the wills are completed.

In a recent decision, Bishop Estate v. Sheardown, 2021 BCSC 1571, the Supreme Court of British Columbia gave effect to a draft will that was left unsigned because of Covid-19 restrictions. Section 58 of the Wills, Estates and Succession Act allows the court to give effect to a document or other record in British Columbia even though the document has not been signed and witnessed in accordance with the formal requirements for making a valid will. This provision has been used in a wide variety of contexts to give effect to a document if the court is satisfied that the document is authentic and reflects the deliberate or fixed and final intentions of the now deceased person. As I have written before, it may be difficult to satisfy a court to give effect to a draft will prepared by a lawyer months before the person died, without a good explanation of why the lawyer’s client didn’t make an appointment with her lawyer to sign the will. In Bishop Estate, there was a good explanation: Covid-19.

On June 27, 2014 Marilyn Carole Bishop and her husband made wills in which each left everything to the other, and if the other had died, to the Kelowna General Hospital Foundation. The Bishops did not have any children. Mr. Bishop had been treated at the Kelowna General Hospital, and their gifts to the Foundation reflected their gratitude for his treatment. 

After Mr. Bishop’s death, Ms. Bishop’s nephew Robert Sheardown and his wife, Deborah Sheardown, moved to Kamloops, nears where Ms. Bishop resided. They became very close and they assisted her.

In February 2020, Ms. Bishop met with her lawyer to revise her will. She told her lawyer, Matthew Livingston, that she wanted to give most of here estate to the Sheardowns. She wanted to give a gift to their daughter and was considering modest gifts to some o charities. She said the gift to the Kelowna General Hospital Foundation was her husband’s idea and she had no connection to Kelowna, which she considered two far away.

Mr. Livingston drafted a will for her, with some questions. She delivered a note to him setting out Ms. Sheardown’s full name, that she wanted to give a brooch to her great-niece and “No charities at this time.”

On March 17, 2020, she booked an appointment for March 20, to sign the final draft will, which reflected the changes as set out in her note. On March 19, she cancelled her appointment. By that time, the care home in which she lived had prohibited residents from leaving other than for medical appointments, and did not permit visitors, in order to protect residents from Covid-19. Ms. Bishop died on July 20, 2020, without signing her will.

The Kelowna General Hospital Foundation argued that the 2020 draft will should not be given effect. They argued that the words “No charities at this time,” implied that Ms. Bishop had not demonstrate a fixed and final intention. However, Madam Justice Matthews that wills are by their nature revocable, and the issue is whether the intentions are fixed and final at the relevant time. It is not necessary for someone to decide that they would not change the will in the future.

In finding that the document did reflect Ms. Bishop’s fixed and final intentions, Madam Justice Matthews carefully reviewed the facts:

[38]         It is evident that Ms. Bishop reviewed the draft that Mr. Livingston sent to her on February 12, 2020. Her handwritten note that she delivered on March 3, 2020, directly responded to each of Mr. Livingston’s questions in the comment boxes in the first draft.

[39]         In her note, Ms. Bishop did not suggest any new changes to the will; she simply filled in the blanks that Mr. Livingston had left for her. The first was to fill in Ms. Sheardown’s middle name. The second was to specify a gift for the Sheardowns’ daughter, whom Ms. Bishop had already mentioned that she would like to give a gift to. Although Mr. Livingston had discussed the possibility of a registered education savings plan for her, Ms. Bishop ultimately decided to give her a gold brooch.

[40]         The same can be said of Ms. Bishop’s third instruction, “no charities at this time”. When she met with Mr. Livingston, Ms. Bishop indicated that while she did not want to give a gift to Kelowna General Hospital Foundation, she might want to make a couple of modest gifts to specific charities. In the month that followed, Ms. Bishop decided she did not want to make charitable gifts.  This is not problematic. The gifts initially proposed were relatively minor: $10,000–$20,000 for each of Thomson Rivers University and the Firefighters’ Burn Fund. At most, this represented approximately 7% of her total estate.

[41]         Kelowna General Hospital Foundation submits that the language of “at this time” indicates that Ms. Bishop’s intentions lacked finality. I am not satisfied that it demonstrates that her intentions were not final. As Dickson J. notes in Young Estate at para. 35, a fixed and final intention cannot mean that the intention is irrevocable, since wills are, by their nature, revocable until the testator’s death. Rather, the intention need only “be fixed and final at the material time”.

[42]         Accordingly, the mere mention of “at this time” is not enough to overcome the considerable evidence that suggests that her intentions were fixed and final. Her instruction was not an equivocation; it was a clear expression of her fixed and final intention at the time she delivered the note on March 3, 2020. Of course, in this case, the material time stretches beyond March 3 to the date of Ms. Bishop’s death; nevertheless, as I will discuss, nothing suggests that Ms. Bishop’s intention to not give to any charities changed in that time.

[43]         Ms. Bishop did not request any substantive changes to the draft. The manner in which she responded to Mr. Livingston’s questions suggests that she was satisfied with the unexecuted 2020 will and was prepared to execute it. When she was asked if she wanted to review it again in advance of an appointment to sign it, she made an appointment to sign it. In the circumstances, it cannot be said that the unexecuted 2020 will “was not seen, or read, or written, or in some way authenticated, or adopted”: George v. Daily (1997), 143 D.L.R. (4^th) 273 (Man. C.A.) at para. 56.

[44]         It is relevant that the unexecuted 2020 will makes considerable sense in the circumstances: Hubschi Estate (Re), 2019 BCSC 2040 at para. 40. Based on the evidence, it is unsurprising that Ms. Bishop would wish to name the Sheardowns as the executors and primary beneficiaries of her estate and to remove Kelowna General Hospital Foundation as a beneficiary.

[45]         The document and the context in which it is made has the hallmarks of fixed and final testamentary intention in that bears the title of a will, it was made by a lawyer retained by Ms. Bishop for that purpose, it revokes her prior wills, it directs how her remains are to be dealt with, it names executors and beneficiaries including an alternate beneficiary. The beneficiaries make sense in the context of Ms. Bishop’s relationships. Ms. Bishop’s response to Mr. Livingston’s questions provided him with the information necessary to complete the draft.

Accordingly, the Sheardowns will receive Ms. Bishop’s estate.

Nova Scotia Court of Appeal Allows Appeal in Lawen Estate

Both Nova Scotia and British Columbia allow independent adult children to apply to court to vary their parents’ wills. Although other provinces in Canada have legislation allowing spouses, minor and dependent children to apply for dependant’s relief on the death of a spouse or parent who has provided little or no inheritance, the provisions allowing independent adult children to apply are not common.

British Columbia has had this legislation under various titles for over 100 years now. The Supreme Court of Canada has decided cases and outlined principles that are to applied to claims made under British Columbia’s legislation, including claims by independent adult children. The most recent Supreme Court of Canada decision is Tataryn v. Tataryn Estate, [1994] 2 SCR 807. I was a bit surprised when Justice Bodurtha of the Supreme Court of Nova Scotia held in Lawen Estate v. Nova Scotia (Attorney General), 2019 NSSC 162 (CanLii) that Nova Scotia’s Testator Family Maintenance Act offends section 7 of the Charter of Rights and Freedoms insofar as it permits non-dependant adult children to apply of vary their parents’ wills. Section 7 of the Charter says:

Everyone has the right to life, liberty and security of the person and the right not to be deprived thereof except in accordance with the principles of fundamental justice.

The court found that to the extent that the legislation interfered with the testamentary autonomy of the will-maker in respect of independent adult children, it violates the constitutional right to liberty. The Court read down the legislation so that it would not apply to non-dependant adult children.

The Nova Scotia Court of Appeal in Nova Scotia (Attorney General) v. Lawen Estate, 2021 NSCA 39 (CanLii) disagreed. On appeal by the Attorney General of Nova Scotia, the Court allowed the appeal. Justice Farrar, writing for the Court, held that there was an insufficient evidentiary basis to find that the legislation violated section 7 of the Charter:

[52]         In this case, there was no evidence put before the application judge to establish an engagement with matters critical to a testator’s dignity and autonomy.  Nor was there any evidence indicating why – from a public interest perspective – testamentary capacity was a pressing issue, that testators’ wishes were being arbitrarily ignored, or that testamentary autonomy to preclude a non-dependent adult child engaged the liberty interests of an individual.  There was no consideration of whether s. 5 of the Act, which outlines the factors to be taken into account when considering a claim of a dependent, safeguarded a testator’s autonomy.

[53]         The application judge did not consider, even if a breach of s. 7 was made out, whether it was in accordance with principles of fundamental justice.  He inferred that the AGNS accepted if a violation of the liberty interest was found it would not be in accordance with principles of fundamental justice (¶62).  The AGNS did not make any such concession.  It was incumbent upon the application judge to undertake this crucial aspect of the constitutional analysis.

[54]         The application judge did refer to Tataryn Estate, supra, where McLachlin, J., explained that the purpose of the Act was to ameliorate circumstances of women and children at the time when men held most of the property, to ensure that women and children would receive an adequate, just and equitable share of the family wealth on the death of the person who held it, even in circumstances where they were not able to demonstrate need (Tataryn Estate, ¶ 16, cited at ¶ 19 herein).  However, he did no analysis nor did he make any finding as to whether the objects of the Act were in compliance with the principles of fundamental justice.

[55]         There was no finding that the impugned provisions caused harm, that they were arbitrary, overbroad or grossly disproportionate to the objectives of the legislation.  All of which would have been necessary to anchor a breach of s. 7.

There are no reported decisions in British Columbia at the time of writing this post that have ruled on the question of whether our legislation is constitutional. Nor has the Supreme Court of Canada considered this issue. Neither the Supreme Court of Nova Scotia decision or the Nova Scotia Court of Appeal decision is technically binding on a British Columbia court, but a judge in B.C. could find the reasoning persuasive and apply it here.