Thursday, March 07, 2013

Laszlo v. Lawton

Magdolna Czuczor and her husband Eugene Czuczor did not have any children of their own. They were close to Mr. Czuczor’s family, particularly his sister and brother in-law Roslia and John Laszlo and their three children whom they sponsored as immigrants to Canada in the 1970s. The Czuczor’s themselves had emigrated from Hungary in the 1950s, and purchased an orchard where they lived and farmed in the Southern Okanagan Valley of British Columbia.

Over the years, the Laszlo children assisted the Czuczor’s in their orchard, visiting and helping over spring breaks and summer vacations. The Czuczor’s told them that the orchard would one day be theirs.

In 1967, Mr. and Mrs. Czuczor’s had made wills. Mrs. Czuczor’s will left everything to her husband, but if he died first, her estate would be divided among his mother and his three siblings. His will was a mirror of hers.

In 1986, they each made new wills, leaving everything to each other. Each provided that if the other died first, the residue of the estate would be divided equally among Mr. Czuczor’s eight nieces and nephews, including the three Laszlo children.

But in 2000, Mr. and Mrs. Czuczor signed new wills that were significantly different from their previous wills. Again, each left everything to the other. But on the death of the last of them to die, each left five percent to a friend, Mr. Richard Lawton, and the other 95 per cent to be divided equally between two charities, Penticton United Church and The British Columbia Society for Children with Disabilities. They each named the other as executor and trustee and Mr. Lawton as their alternate executor and trustee.

Mr. Czuczor died October 10, 2005. Mrs. Czuczor died five years later, on April 12, 2008 at the age of 84.

Following her death, the beneficiaries of her 1986 will challenged the validity of Mrs. Czuczor’s 2000 will.

There was evidence that Mrs. Czuczor was paranoid and delusional near the time of the will. There were a number of incidents of very strange behaviour. She also had difficulty with in short-term memory.

Madam Justice Ballance, in Laszlo v. Lawton, 2013 BCSC 305, reviewed the law on proving a will when capacity is in issue. There is a presumption when the will is signed in accordance with the formal requirements of the Wills Act, and is read over by or to the maker, that the will is valid. But if there are suspicious circumstances concerning the capacity of the will-maker, the burden is on the parties seeking to uphold the will to dispel the suspicious circumstances and prove that the will is valid.

She quoted Laskin J.A. (dissenting on other grounds) in Re Schwartz (1970), 10 D.L.R. (3d) 15 at 32 (Ont. C.A.) as a modern statement of the tests of capacity:

The testator must be sufficiently clear in his understanding and memory to know, on his own, and in a general way (1) the nature and extent of his property, (2) the persons who are the natural objects of his bounty and (3) the testamentary provisions he is making; and he must, moreover, be capable of (4) appreciating these factors in relation to each other, and (5) forming an orderly desire as to the disposition of his property ...

In her decision, Madam Justice Ballance also considered one of the leading English authorities on the affect of delusions on capacity,  Banks v. Goodfellow (1870), L.R. 5 Q.B. 549 a case frequently cited by Canadian courts on capacity to make a will (I wrote a post on the Banks case here). In Banks, Chief Justice Cockburn held that the fact that the will-maker was suffering from delusions does not preclude the will-maker from having capacity to make a will. The will is invalid if the delusions are directed at those whom the will-maker would be expected to consider and influence the will.

Although Madam Justice Ballance did not find that Mrs. Czuczor’s delusions affected the provisions she made in her will, Madam Justice Ballance reasoned that the delusions were still relevant to assessing Mrs. Czuczor’s mental functioning in the context of medical opinion of dementia. She wrote at paragraphs 227-229:

[227]     I accept the opinions of Drs. Cooper and Sheldon that when the Deceased made her 2000 Will, she was probably in the early stages of Alzheimer’s disease, a type of dementia which is a progressive degenerative disease of the brain.  Based on Dr. Sheldon’s opinion, I consider it likely that some or perhaps many of her symptoms of psychosis at that time, by which I mean her auditory and visual hallucinations and the delusions she experienced to a greater or lesser extent, were part of her overall presentation of that disease.  It follows that the existence of delusions, while not themselves sufficient to defeat testamentary capacity, ought not to be excluded from consideration under the rubric of suspicious circumstances or the ultimate assessment of whether a testator possessed testamentary capacity at the material time.  Non-vitiating delusions may reflect the ravages upon the testator’s mental functioning at large exacted by dementia or other brain disease, which cannot reasonably be ignored in the overall assessment of testamentary capacity.

[228]     The relevance of the presence of delusions in relation to these issues has been alluded to by this Court in past cases.  To illustrate, in Peters Estate v. Ewert, 2002 BCSC 1540, the court considered a delusion that did not affect the terms of the will in conjunction with other evidence of the testatrix’s deteriorating mental health as a suspicious circumstance.  In Brydon v. Malamas, 2008 BCSC 749, the testatrix was found to lack capacity in part due to delusions concerning a particular beneficiary – a result largely in line with the case law.  However, Halfyard J. went on to suggest, in obiter, at para. 222, that had that delusion not existed, various other psychotic delusions coupled with an illness suffered by the testatrix could have been sufficient to vitiate capacity despite being unrelated to the subject matter of the will. 
[229]     In my view, consideration of non-vitiating delusions in this broader sense where the evidence suggests that all or some of the testator’s delusions accompany a progressive degenerative brain disease like Alzheimer’s does not run afoul of the rule in Banks or its lineage. 

Madam Justice Ballance found that there were several suspicious circumstances. First, the 2000 will was a significant departure from Mrs. Czuczor’s earlier wills, which had benefited her husband’s family. Second, the 2000 will was irrational in that she had no connection to the two charitable beneficiaries. She was not Protestant, and had no previous involvement with The British Columbia Society for Children with Disabilities. Third, she had a special relationship with the Laszlo family. Fourth, she had assured them that they would benefit from the orchard as a family legacy. Fifth, there was evidence that when Mrs. Czuzcor made the 2000 will “she was suffering from a constellation of on-going symptoms, including delusions, paranoia, auditory and visual hallucinations, confusion, compromised short-term memory, disorganized thought, zero insight, and impaired judgment.  Her symptoms were suggestive of not insignificant mental compromise many or perhaps the majority of which were attributable to Alzheimer’s disease.”

Although the notary who took instructions, drafted and witnessed the will did not have concerns about Mrs. Czuczor’s capacity to make a will, Madam Justice Ballance found that Mrs. Czuczor had given him incomplete and inaccurate information about the assets she owned and their value, and inferred that she did not have a sufficient understanding of the nature and extent of her assets to have capacity to make a will.

Mr. Lawton and the two chartable beneficiaries were unable to dispel the suspicious circumstances and prove that Mrs. Czuczor had the capacity to make a will.

The result is that the 2000 will may not be probated, and the executor of the 1986 will may apply to probate that will, in which case Mr. Czuczor’s eight nieces and nephews will share the residue of her estate.

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