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The Kelowna General Hospital Foundation Advisor's Roundtable will be presenting free financial and estate planning seminar on Thursday, November 5, 2009 from 3:30 pm to 5:00 pm at the Missionwood Retirement Resort, 1075 Barnes Avenue, Kelowna, British Columbia.
I will be speaking on powers of attorney and representation agreements.
Laurie Bartley, financial planner, of Canaccord Financial Services Ltd. will also be giving a talk. Her topic is “Maximizing Your Retirement Income.”
Len Vandenberg, accountant at BDO Dunwoody LLP will be presenting “Top 5 Tax Tips when giving to Charity as part of your Estate Plan.”
Please RSVP to Diane Paterson, KGH Foundation - (250) 862-4300, local 7011, or Email - diane.paterson@interiorhealth.ca by November 04, 2009.
This event is sponsored by the Kelowna General Hospital Foundation.
Thursday, October 29, 2009
Saturday, October 24, 2009
Spouse's Preferential Share Under the New Wills, Estates and Succession Act
When it is brought into force, the new British Columbia Wills, Estates and Succession Act will increase the preferential share that goes to a spouse of a person who dies without a will.
The current law, section 85 of the Estate Administration Act, provides that when someone dies without a will in British Columbia leaving a spouse and descendents, the spouse is entitled to the first $65,000 of the estate (as well as household furnishings and a life estate in the spousal home). The spouse’s portion of the rest of the estate is one-half, if the deceased left only one child or one-third if the deceased left more than one child. For the purpose of determining the spouse's share, a child who has died before his or her deceased parent is counted if that child left descendents who are living at the intestate parent's death.
Under section 21 of the Wills, Estates and Succession Law Act., the spouse’s preferential share will be increased. The amount will depend on whether the deceased’s descendents are all also the surviving spouse’s descendents or some of them are not the surviving spouse’s descendents.
If the deceased's descendents are all common descendents of both the deceased and the surviving spouse, then the spouse’s preferential share is $300,000. If some of the deceased’s descendents are not common descendents than the spouse’s preferential share is $150,000. The theory behind this is no doubt that if all of the descendents are common to both the deceased and the surviving spouse, they will most likely eventually inherit something from the surviving spouse.
The spouse’s portion of the rest of the estate under the new Act will be one-half, with the other half going to the deceased’s descendants in the manner set out in the legislation.
Let’s look at a couple of examples. Paul dies without a will leaving his wife Sarah, and their two children. His net estate (after payment of his debts and funeral expenses) consists of $400,000 of investments.
Under the current laws, Sarah would be entitled to $176,666.67 ($65,000 plus one-third of the remaining $335,000), and each of their children would be entitled to $111,666.66 (one-half of the remaining $223,333.33).
Under the Wills, Estates and Succession Act, Sarah would be entitled to $350,000 ($300,000 plus one-half of the remaining $100,000), and each of their two children will be entitled to $25,000 (one-half of the remaining $50,000).
Now let’s change the facts a little bit. Paul and Sarah have one child together, but Paul also has a child from a previous marriage. Sarah would receive $275,000 ($150,000 plus one-half of the remaining $250,000). Each of Paul’s two children would receive $62,500 (one-half of the remaining $125,000).
Under the new Act, the surviving spouse will still be entitled to the household furnishings, but there are new provisions concerning the spousal home, which I will discuss in another post.
The current law, section 85 of the Estate Administration Act, provides that when someone dies without a will in British Columbia leaving a spouse and descendents, the spouse is entitled to the first $65,000 of the estate (as well as household furnishings and a life estate in the spousal home). The spouse’s portion of the rest of the estate is one-half, if the deceased left only one child or one-third if the deceased left more than one child. For the purpose of determining the spouse's share, a child who has died before his or her deceased parent is counted if that child left descendents who are living at the intestate parent's death.
Under section 21 of the Wills, Estates and Succession Law Act., the spouse’s preferential share will be increased. The amount will depend on whether the deceased’s descendents are all also the surviving spouse’s descendents or some of them are not the surviving spouse’s descendents.
If the deceased's descendents are all common descendents of both the deceased and the surviving spouse, then the spouse’s preferential share is $300,000. If some of the deceased’s descendents are not common descendents than the spouse’s preferential share is $150,000. The theory behind this is no doubt that if all of the descendents are common to both the deceased and the surviving spouse, they will most likely eventually inherit something from the surviving spouse.
The spouse’s portion of the rest of the estate under the new Act will be one-half, with the other half going to the deceased’s descendants in the manner set out in the legislation.
Let’s look at a couple of examples. Paul dies without a will leaving his wife Sarah, and their two children. His net estate (after payment of his debts and funeral expenses) consists of $400,000 of investments.
Under the current laws, Sarah would be entitled to $176,666.67 ($65,000 plus one-third of the remaining $335,000), and each of their children would be entitled to $111,666.66 (one-half of the remaining $223,333.33).
Under the Wills, Estates and Succession Act, Sarah would be entitled to $350,000 ($300,000 plus one-half of the remaining $100,000), and each of their two children will be entitled to $25,000 (one-half of the remaining $50,000).
Now let’s change the facts a little bit. Paul and Sarah have one child together, but Paul also has a child from a previous marriage. Sarah would receive $275,000 ($150,000 plus one-half of the remaining $250,000). Each of Paul’s two children would receive $62,500 (one-half of the remaining $125,000).
Under the new Act, the surviving spouse will still be entitled to the household furnishings, but there are new provisions concerning the spousal home, which I will discuss in another post.
Sunday, October 18, 2009
Vancouver Sun Article on the Wills, Estates and Succession Act
I was pleased to see that the Vancouver Sun had an article on British Columbia’s new Wills, Estates and Succession Act, which has been passed by the Legislative Assembly, but is not yet in effect. The commercial press doesn’t give a lot of coverage to succession law reform.
I was pleased, I should say, until I actually read the article by Vancouver Sun reporter Ian Mulgrew, entitled “Where there’s a will, there will soon be an end to archaic laws.”
In the Sun article Mr. Mulgrew focused on one aspect of new Act: a change in the burden of proof of undue influence in disputes over wills. It is probably not the change I would pick to write about, if I were writing just one article on British Columbia’s succession law reform. Other changes will affect far more people. But Mr. Mulgrew’s choice of topic is not what bothers me about the article.
I will give you a little background on the change. The common law rule in British Columbia is that if you are challenging a will on the basis that someone exercised undue influence on the maker, that is influence of such a nature that the will does not truly reflect the testator’s intentions, you must prove the undue influence. This follows the usual rule that if you accuse someone of doing something wrong, you must prove it. In practice, it is very difficult to prove that someone procured a will by undue influence.
But the common law has a different burden of proof in cases where a vulnerable person makes gifts during his lifetime to a person who is in a position to dominate that vulnerable person. If you attack the transaction and are able to show that the beneficiary of the assets was in a position to dominate, then the burden is on the beneficiary to prove that the gift was made freely. Usually the beneficiary must then show that the vulnerable person had some independent advice before making the gift.
The Wills, Estates and Succession Act will change the burden of proof of undue influence in wills so that if the person challenging the will can show the beneficiary was in a position to dominate the maker, then the beneficiary will have to show that he or she did not exercise undue influence. This is set out in section 52:
The difficulty I have with the Sun article is that Mr. Mulgrew presents the change as one that is needed because lawyers and doctors are going around unduly influencing their clients and patients to put them in their wills. He writes:
What examples of cases close to home does Mr. Mulgrew give of lawyers unduly influencing their clients?
But, contrary to what Mr. Mulgrew implies, lawyers unduly influencing their clients to leave them inheritance does not happen regularly. It would hardly be noteworthy that lawyers in New York (about 4000 km away from Vancouver) were caught in such schemes if it happened regularly. It doesn’t happen regularly, either here or in New York for that matter.
How about examples of doctors taking advantage of their patients to get inheritances? Thankfully, Mr. Mulgrew does not try to give any.
The implications against lawyers and other professionals in the article are unfair, and unsupported.
But what bothers me most about the article is that it may tend to frighten vulnerable people away from the very people who may be able to protect them best against undue influence and other types of abuse.
A careful estate planning lawyer will meet alone with a client preparing a will so that the client can speak in confidence. A lawyer will question his or her client about finances and family. If the client says he or she wishes to leave a large gift to someone you would not ordinarily expect the client to benefit, the lawyer can ask why. With appropriate questioning lawyers can often (not always) ferret out undue influence, and find out what the client really wants.
If an estate planning lawyer has concerns about his or her client’s mental capacity to make a will, or to make a large gift, then a careful lawyer will get the client’s permission to speak with his or her doctor to get further insight.
Lawyers can and do refuse to draw wills or handle transactions for people who are not competent, or who do not appear to be acting freely and voluntarily.
Sadly, vulnerable people are much more likely to be victimized by people who are close to them, than by independent professionals. It is far easier for the unscrupulous to benefit by unduly influencing a vulnerable person to make a homemade will, than when a lawyer is involved in the process, and the lawyer insists on meeting alone with the vulnerable person before the will is drawn.
I was pleased, I should say, until I actually read the article by Vancouver Sun reporter Ian Mulgrew, entitled “Where there’s a will, there will soon be an end to archaic laws.”
In the Sun article Mr. Mulgrew focused on one aspect of new Act: a change in the burden of proof of undue influence in disputes over wills. It is probably not the change I would pick to write about, if I were writing just one article on British Columbia’s succession law reform. Other changes will affect far more people. But Mr. Mulgrew’s choice of topic is not what bothers me about the article.
I will give you a little background on the change. The common law rule in British Columbia is that if you are challenging a will on the basis that someone exercised undue influence on the maker, that is influence of such a nature that the will does not truly reflect the testator’s intentions, you must prove the undue influence. This follows the usual rule that if you accuse someone of doing something wrong, you must prove it. In practice, it is very difficult to prove that someone procured a will by undue influence.
But the common law has a different burden of proof in cases where a vulnerable person makes gifts during his lifetime to a person who is in a position to dominate that vulnerable person. If you attack the transaction and are able to show that the beneficiary of the assets was in a position to dominate, then the burden is on the beneficiary to prove that the gift was made freely. Usually the beneficiary must then show that the vulnerable person had some independent advice before making the gift.
The Wills, Estates and Succession Act will change the burden of proof of undue influence in wills so that if the person challenging the will can show the beneficiary was in a position to dominate the maker, then the beneficiary will have to show that he or she did not exercise undue influence. This is set out in section 52:
52 In an action, if a person claims that a will or any provision of it resulted from another personMr. Mulgrew believes that the change is a good one. But that is not the problem I have with the article. I too support the change. When the Ministry of the Attorney General requested comments from the public on the proposed change, I wrote a letter in support (which I have published on my blog here).
(a) being in a position where the potential for dependence or domination of the will-maker was present, and
(b) using that position to unduly influence the will-maker to make the will or the provision of it that is challenged,
and establishes that the other person was in a position where the potential for dependence or domination of the will-maker was present, the party seeking to defend the will or the provision of it that is challenged or to uphold the gift has the onus of establishing that the person in the position where the potential for dependence or domination of the will-maker was present did not exercise undue influence over the will-maker with respect to the will or the provision of it that is challenged.
The difficulty I have with the Sun article is that Mr. Mulgrew presents the change as one that is needed because lawyers and doctors are going around unduly influencing their clients and patients to put them in their wills. He writes:
I think one of the most important anomalies the government is moving to fix is the law governing what is known as "undue influence." That's when your doctor, lawyer, would-be pal or suddenly loving relative has you sign away property or cash while you're on your deathbed, non compos mentis or too weak to resist.How often does this happen? According to Mr. Mulgrew, “Happens regularly.”
What examples of cases close to home does Mr. Mulgrew give of lawyers unduly influencing their clients?
Lawyers in New York last year were caught drawing up wills for wealthy clients and inserting each other’s names for multi-million-dollar bequests of art, apartments and cash.New York is a little ways away. How about some cases in British Columbia?
There are ugly rumours in the legal community that a couple of B.C. lawyers have engaged in the same legerdemain.I have never heard these rumours, but I have no reason to disbelieve Mr. Mulgrew that there are rumours. I don’t put a lot of stock in rumours, but they could be true. There are thousands of lawyers in British Columbia, and every year the Law Society of British Columbia has to suspend or disbar a handful of them.
But, contrary to what Mr. Mulgrew implies, lawyers unduly influencing their clients to leave them inheritance does not happen regularly. It would hardly be noteworthy that lawyers in New York (about 4000 km away from Vancouver) were caught in such schemes if it happened regularly. It doesn’t happen regularly, either here or in New York for that matter.
How about examples of doctors taking advantage of their patients to get inheritances? Thankfully, Mr. Mulgrew does not try to give any.
The implications against lawyers and other professionals in the article are unfair, and unsupported.
But what bothers me most about the article is that it may tend to frighten vulnerable people away from the very people who may be able to protect them best against undue influence and other types of abuse.
A careful estate planning lawyer will meet alone with a client preparing a will so that the client can speak in confidence. A lawyer will question his or her client about finances and family. If the client says he or she wishes to leave a large gift to someone you would not ordinarily expect the client to benefit, the lawyer can ask why. With appropriate questioning lawyers can often (not always) ferret out undue influence, and find out what the client really wants.
If an estate planning lawyer has concerns about his or her client’s mental capacity to make a will, or to make a large gift, then a careful lawyer will get the client’s permission to speak with his or her doctor to get further insight.
Lawyers can and do refuse to draw wills or handle transactions for people who are not competent, or who do not appear to be acting freely and voluntarily.
Sadly, vulnerable people are much more likely to be victimized by people who are close to them, than by independent professionals. It is far easier for the unscrupulous to benefit by unduly influencing a vulnerable person to make a homemade will, than when a lawyer is involved in the process, and the lawyer insists on meeting alone with the vulnerable person before the will is drawn.
Saturday, October 10, 2009
Wills, Estates and Succession Law Act: Variation of Wills
How will British Columbia’s new Wills, Estates and Succession Law Act affect the Wills Variation Act?
The British Columbia Law Institute had recommended some radical changes to British Columbia’s Wills Variation Act as part of its recommendations on reforming succession law, including limiting the rights of adult children to apply to vary their parents’ wills.
But the Wills, Estates and Succession Law Act, as passed by the British Columbia Legislative Assembly, kept most of the current law intact. Adult children will still be able to apply.
When the Wills, Estates and Succession Law Act is brought into force, the Wills Variation Act will be repealed. But most of the provisions of the Wills Variation Act can be found in Part 4, Division 6 of the Wills, Estates and Succession Law Act.
There will be some changes to the law. Currently a separated spouse may apply to vary his or her deceased spouse’s will, provided that the spouses have not divorced. The definition of spouse under the new legislation will exclude married spouses in some circumstances, including spouses who have been separated for at least two years, if one or both of them had an intention to live separate and apart permanently. Specifically, section 2(2) of the Wills, Estates and Succession Law Act provides:
There is also a new time limit in the new Act. Currently, the Wills Variation Act provides that a lawsuit must be filed within six months of the date of probate or resealing of the will in British Columbia. The new Act will change the limitation to 180 days (I have no idea why).
There is also a new provision (section 61(1)(b)) that the writ of summons starting the lawsuit must be served on the executor “no later than 30 days after the expiry of the 180 day” limitation period. The court may extend the period for serving the writ. Under the Wills Variation Act, the plaintiff has a year from the date the writ of summons is filed to serve it on the executor and the other defendants before the writ expired. An executor might distribute the estate without realizing that someone had sued under the Wills Variation Act. (A prudent executor will check the Court Services Online to make sure no suits have been filed before distributing an estate in British Columbia.)
Until the Wills, Estates and Succession Law Act is brought into effect, the Wills Variation Act will continue to govern wills variation claims in British Columbia.
The British Columbia Law Institute had recommended some radical changes to British Columbia’s Wills Variation Act as part of its recommendations on reforming succession law, including limiting the rights of adult children to apply to vary their parents’ wills.
But the Wills, Estates and Succession Law Act, as passed by the British Columbia Legislative Assembly, kept most of the current law intact. Adult children will still be able to apply.
When the Wills, Estates and Succession Law Act is brought into force, the Wills Variation Act will be repealed. But most of the provisions of the Wills Variation Act can be found in Part 4, Division 6 of the Wills, Estates and Succession Law Act.
There will be some changes to the law. Currently a separated spouse may apply to vary his or her deceased spouse’s will, provided that the spouses have not divorced. The definition of spouse under the new legislation will exclude married spouses in some circumstances, including spouses who have been separated for at least two years, if one or both of them had an intention to live separate and apart permanently. Specifically, section 2(2) of the Wills, Estates and Succession Law Act provides:
(2) Two persons cease being spouses of each other for the purposes of this Act
if,
(a) in the case of a marriage,
(i) they live separate and apart for at least 2 years with one or both of them having the intention, formed before or during that time, to live separate and apart permanently, or
(ii) an event occurs that causes an interest in family assets, as defined in Part 5
of the Family Relations Act, to arise, or
(b) in the case of a marriage-like relationship, one or both persons terminate the
relationship.
There is also a new time limit in the new Act. Currently, the Wills Variation Act provides that a lawsuit must be filed within six months of the date of probate or resealing of the will in British Columbia. The new Act will change the limitation to 180 days (I have no idea why).
There is also a new provision (section 61(1)(b)) that the writ of summons starting the lawsuit must be served on the executor “no later than 30 days after the expiry of the 180 day” limitation period. The court may extend the period for serving the writ. Under the Wills Variation Act, the plaintiff has a year from the date the writ of summons is filed to serve it on the executor and the other defendants before the writ expired. An executor might distribute the estate without realizing that someone had sued under the Wills Variation Act. (A prudent executor will check the Court Services Online to make sure no suits have been filed before distributing an estate in British Columbia.)
Until the Wills, Estates and Succession Law Act is brought into effect, the Wills Variation Act will continue to govern wills variation claims in British Columbia.
Wednesday, October 07, 2009
Is the British Columbia Government Ever Going to Reform Adult Guardianship Laws?
It's been almost two years since the British Columbia Legislative Assembly passed Bill 29, the Adult Guardianship and Planning Statutes Amendment Act, 2007 .
One of the purposes of the legislation was to modernize British Columbia's adult guardianship legislation. The need for reform is well set out in this backgrounder published by the Ministry of the Attorney General on April 27, 2006:
Although this legislation was passed, it has not been brought into force.
Today the Government of British Columbia introduced Bill 13, Miscellaneous Statutes Amendment Act, 2009. Bill 13, changes the wording is several parts of the Adult Guardianship and Planning Statutes Amendment Act, 2009, by replacing references to a "guardian" under the new legislation, with references to a "committee" under the "Patients Property Act."
According to this Government of British Columbia information bulletin published today:
This implies to me that the adult guardianship provisions will be brought into force with "unnecessary delay." It looks like I will have to explain that "committee" means "adult guardian" for a long time to come.
One of the purposes of the legislation was to modernize British Columbia's adult guardianship legislation. The need for reform is well set out in this backgrounder published by the Ministry of the Attorney General on April 27, 2006:
Adult Guardianship:
Adult guardianship in British Columbia is currently governed by the Patients Property Act, which is over 40 years old and based on nineteenth century English law.
Highlights of Amendments to Adult Guardianship:
Changes to the Adult Guardianship Act will update the legal framework for adult guardianship and ensure that modern principles of guardianship – autonomy, dignity, and the use of the least intrusive and restrictive approach – apply to court-ordered and statutory guardianship by:
Enhancing procedural fairness in the statutory guardianship framework, for example, by providing a right of review, increasing the right of participation by the adult and providing clear options for terminating guardianship when it is no longer needed.Providing more options to allow guardianship to be tailored to fit an incapable adult’s circumstances, such as allowing for temporary guardianship or guardianship that has limited powers or duration, and allowing the public guardian and trustee (PGT)* to
transfer statutory guardianship to an adult family member or friend.Clarifying the powers and obligations of guardians, including the duty to encourage the adult’s involvement in decision making and providing for a new code of practice that will be developed over time to set out best practice guidelines for guardians.
Requiring applicants for guardianship to provide forward looking guardianship plans in place of the more limited information currently required.
Facilitating mobility by easing recognition of guardianship orders made elsewhere in Canada.
Although this legislation was passed, it has not been brought into force.
Today the Government of British Columbia introduced Bill 13, Miscellaneous Statutes Amendment Act, 2009. Bill 13, changes the wording is several parts of the Adult Guardianship and Planning Statutes Amendment Act, 2009, by replacing references to a "guardian" under the new legislation, with references to a "committee" under the "Patients Property Act."
According to this Government of British Columbia information bulletin published today:
[The] [a]mendments will enable the incapacity planning provisions of the act, relating to advance directives, enduring powers of attorney and representation agreements, to be brought into force independently of the adult guardianship provisions. This will ensure important changes that strengthen incapacity planning instruments can be brought into force without unnecessary delay.
This implies to me that the adult guardianship provisions will be brought into force with "unnecessary delay." It looks like I will have to explain that "committee" means "adult guardian" for a long time to come.
Monday, October 05, 2009
Superior Court of California, County of Sonoma
I took these photographs in Santa Rosa, California, in August. I had some difficulty figuring out if this building is a courthouse or a law school. It is both. It is the home of Empire College School of Law, and has two Somona County Superior Court courtrooms.Saturday, October 03, 2009
Re: Elsie Jones
When you talk to your lawyer, you may want to keep the conversation private. If the lawyer divulges what you say, it could hurt your interests in a law suit. Or you might find it embarrassing.
Privacy is protected in a couple of ways. First, a lawyer has an ethical duty to keep client conversations and other communications with the lawyer confidential unless the client authorizes the lawyer to disclose information.
Secondly, under Canadian law, there is a legal rule called solicitor-client privilege. This rule provides that a lawyer must not, and cannot be compelled, to divulge information from a client in a court proceeding unless the client has waived the privilege. There are some exceptions to solicitor-privilege but not very many. The principle that a client may speak freely to a lawyer to obtain advice without having to worry that what the client says may somehow be used to harm his interest is fundamental in Canadian law.
Although the lawyer’s obligation to kept client communications confidential and solicitor-client privilege are similar, they are not identical.
This is illustrated by the recent British Columbia Supreme Court decision in Re: Elsie Jones, 2009 BCSC 1306. The case is a dispute about whether Elsie Jones was mentally competent to transfer her condominium to her daughter, Maureen Ringrose. Elsie Jones has been declared incompetent and the Canada Trust Company has been appointed as her committee (in other words her adult guardian.) Elsie Jones two sons say that she was incompetent when she transferred the condominium. The Canada Trust Company asked the court to determine if Maureen Ringrose is entitled to keep the condominium, or if it must be returned to Elsie Jones.
When Elsie Jones transferred the condominium, she had a lawyer. When the lawyer was being cross-examined he said that he had also done some estate planning or Elsie Jones at about the same time as the transfer. The lawyer refused to produce his file to the parties to the lawsuit. His position was that it was both confidential and privileged. He would only produce the file if the court ordered him to do so.
Mr. Justice Savage was asked to rule on whether the file should be produced, and, if so, to whom. He agreed with Elsie Jones’ lawyer that it was confidential, and he was right to insist on a court order.
Although the file was confidential, it was relevant to the question of whether the transfer of the condominium was valid. Mr. Justice Savage did not elaborate on how it was relevant, but it does seem that the file would show how the transfer fit into Elsie Jones' overall estate plan, and would likely be helpful in showing her thinking and capacity.
Relevance to the proceeding trumps confidentiality.
Mr. Justice Savage then considered solicitor-client privilege. He found that this was the type of communication protected by the rule. Although not absolute, the rule had very few exceptions. He held that the estate planning file was subject to solicitor-client privilege, and could not be disclosed unless the privilege is waived by the client.
Because Elsie Jones is incompetent, and the Canada Trust Company is her committee, Canada Trust Company has her rights to the file, and can decide whether or not to waive the solicitor-client privilege. Unless they waive it, the file may not be produced in the proceeding.
While relevance trumps confidentiality, solicitor-client privilege trumps relevance.
This decision leaves Canada Trust Company in the difficult position of deciding whether it is appropriate to waive the solicitor-client privilege.
Privacy is protected in a couple of ways. First, a lawyer has an ethical duty to keep client conversations and other communications with the lawyer confidential unless the client authorizes the lawyer to disclose information.
Secondly, under Canadian law, there is a legal rule called solicitor-client privilege. This rule provides that a lawyer must not, and cannot be compelled, to divulge information from a client in a court proceeding unless the client has waived the privilege. There are some exceptions to solicitor-privilege but not very many. The principle that a client may speak freely to a lawyer to obtain advice without having to worry that what the client says may somehow be used to harm his interest is fundamental in Canadian law.
Although the lawyer’s obligation to kept client communications confidential and solicitor-client privilege are similar, they are not identical.
This is illustrated by the recent British Columbia Supreme Court decision in Re: Elsie Jones, 2009 BCSC 1306. The case is a dispute about whether Elsie Jones was mentally competent to transfer her condominium to her daughter, Maureen Ringrose. Elsie Jones has been declared incompetent and the Canada Trust Company has been appointed as her committee (in other words her adult guardian.) Elsie Jones two sons say that she was incompetent when she transferred the condominium. The Canada Trust Company asked the court to determine if Maureen Ringrose is entitled to keep the condominium, or if it must be returned to Elsie Jones.
When Elsie Jones transferred the condominium, she had a lawyer. When the lawyer was being cross-examined he said that he had also done some estate planning or Elsie Jones at about the same time as the transfer. The lawyer refused to produce his file to the parties to the lawsuit. His position was that it was both confidential and privileged. He would only produce the file if the court ordered him to do so.
Mr. Justice Savage was asked to rule on whether the file should be produced, and, if so, to whom. He agreed with Elsie Jones’ lawyer that it was confidential, and he was right to insist on a court order.
Although the file was confidential, it was relevant to the question of whether the transfer of the condominium was valid. Mr. Justice Savage did not elaborate on how it was relevant, but it does seem that the file would show how the transfer fit into Elsie Jones' overall estate plan, and would likely be helpful in showing her thinking and capacity.
Relevance to the proceeding trumps confidentiality.
Mr. Justice Savage then considered solicitor-client privilege. He found that this was the type of communication protected by the rule. Although not absolute, the rule had very few exceptions. He held that the estate planning file was subject to solicitor-client privilege, and could not be disclosed unless the privilege is waived by the client.
Because Elsie Jones is incompetent, and the Canada Trust Company is her committee, Canada Trust Company has her rights to the file, and can decide whether or not to waive the solicitor-client privilege. Unless they waive it, the file may not be produced in the proceeding.
While relevance trumps confidentiality, solicitor-client privilege trumps relevance.
This decision leaves Canada Trust Company in the difficult position of deciding whether it is appropriate to waive the solicitor-client privilege.
Wills, Estates and Succession Act Passes Third Reading
Bill 4, the Wills, Estates and Succession Act, has received Third Reading in the British Columbia Legislative Assembly, on September 24, 2009.
This new Act overhauls British Columbia's succession laws. The changes are significant, and those of us who practice in this area will have to spend a great deal of time getting familiar with them. I do think that the changes are for the most part beneficial.
Although the Wills, Estates and Succession Act has been passed, it is not yet in effect. It will be brought into force by regulation. I don't know when, but I expect it will be at least a year, in order to give us all time to learn it.
I will be blogging about some of the specific changes.
This new Act overhauls British Columbia's succession laws. The changes are significant, and those of us who practice in this area will have to spend a great deal of time getting familiar with them. I do think that the changes are for the most part beneficial.
Although the Wills, Estates and Succession Act has been passed, it is not yet in effect. It will be brought into force by regulation. I don't know when, but I expect it will be at least a year, in order to give us all time to learn it.
I will be blogging about some of the specific changes.
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