League and Williams Lawyers

Category: Estate Disputes

  • My Parent Gave More of the Estate to My Sibling: Can I Challenge the Will?

    My Parent Gave More of the Estate to My Sibling: Can I Challenge the Will?

    Sometimes, children are surprised when they find out their sibling is inheriting more from their parents, despite their similar relationship. They might it’s unfair and wonder if they can challenge the will and change it, even after their parents’ death. In BC, courts can vary a will that is ruled unfair. To be considered fair, does a will have to give equal provisions to children with the same relationship to the will-writer?

    In short, the answer is no. A fair will by law is one that makes “adequate provision for the proper maintenance and support of the will-maker’s spouse or children”. This means that will-writers still have the testamentary freedom to create their will however they wish. The restriction is that they’re not able to unfairly disinherit a spouse or child. If your sibling is receiving more of the estate, there’s usually not much you can do. To have the will varied, claimants must prove the will didn’t provide adequate provision for their life’s maintenance and support.

    For the sake of this blog post, let’s look consider an example to help understand the principles of unfair wills. Let’s say a parent elects to give $5,000 of their estate to their son, and $150,000 to their daughter.

    When You Can Challenge the Will

    Using the above example, with no details of the circumstances it can be difficult to determine if this provision is unfair. The courts must look at external factors and specifics of the case to fully understand the nature of the provisions. If the son chooses to challenge the will, the courts would look at many different factors in determining whether this $5,000 is an adequate provision or not. Some characteristics and factors the courts will take into account include:

    • The beneficiary’s living situation,
    • The beneficiary’s financial situation and needs,
    • The size of the estate, and
    • The nature of the estate assets.

    Usually, the courts will put a heavy emphasis on the beneficiary’s financial needs. If the son was working a job as a newspaper delivery boy, he could likely prove a financial need in this example and have the will varied. If unfairly disinherited, a child might depend more on government assistance, burdening taxpayers. The child could avoid filing for bankruptcy and social assistance if they inherited a larger estate share. This is the primary function of the disinheritance laws in BC today.

    When a Child is Validly Disinherited

    Even if a parent has a valid reason to disinherit, they’re still able to give the child an inheritance if they choose to do so in their will.

    There are exceptions to this rule. A valid, rational reason consistent with modern Canadian values must justify a disinheritance in a will, according to the Wills, Estates and Succession Act (WESA). Most circumstances allow estrangement as a valid reason for disinheritance. In the same example, if the son ran away at a young age and never returned, he likely wouldn’t inherit, and the parent could validly disinherit him. If a parent can validly disinherit a child, they can give this child as small an inheritance as they want. In most cases, this would mean leaving nothing to the child in the will. For more information, read our blog on valid reasons for disinheriting a child.

    In the end, if one of your siblings received a bit more of an estate than you, there is not a significant chance of successfully challenging the will. You might be able to challenge the will if you believe your inheritance is not adequate or fair due to its extremely different value.

    If you believe you’ve been unfairly disinherited by a parent or spouse, contact an experienced estate lawyer today. We will ensure you receive the inheritance that you’re entitled to – whether that means challenging the will or not.

    Have a question about this topic or a different legal topic? Contact us for a free consultation. Reach us via phone at 250-888-0002, or via email at info@leaguelaw.com.

  • Why Undue Influence During Will Making is Difficult to Prove

    Why Undue Influence During Will Making is Difficult to Prove

    If a claimant can prove that an interested party unduly influenced the testator at the time of writing, courts in BC can rule the will invalid. Undue influence is described in British Columbia as

    “An influence causing the execution of a will which pretends to express the will-maker’s mind, but in reality, does not, and expresses something else which he or she did not really mean.”

    Proving an undue influence claim is difficult because the influence must overpower the testator’s wishes, meaning the will doesn’t reflect their actual wishes. BC allows suggestions and persuasion and does not consider them forms of undue influence. The most common successful undue influence claims involve a will-writer tricked into giving a larger portion of their estate to an undeserving person. Usually, this is someone who recently entered the testator’s life and received a significant portion of the estate.

    An Undue Influence Claim: Who has the Burden of Proof?

    The burden of proof is typically on the claimant to prove that the will-maker was under undue influence at the time of writing. Although, the burden of proof can shift to the defendant if the claimant shows a special relationship between the will-maker and the other person substantially benefiting from the will – known as the presumption of undue influence. The classic example of this is when the will-maker is a parent who is dependent on one of their children for their day-to-day care. Once this special relationship is established, the person who benefited from the gift must prove that it was not made because of undue influence. If he or she cannot do this, the court can cancel or reduce the gift, or even set the entire will aside.

    Will Writing While Terminally Ill

    In BC, someone’s persuasion during the will writing process doesn’t qualify as undue influence.

    While unsuccessful, there was a recent case in the BC Supreme Court where a woman’s godchildren were claiming her will was invalid on the grounds of undue influence. The woman was in the hospital with an inoperable brain tumour in 2016. During her time in the hospital, she rewrote her will from 2009 – writing two new wills within five days. The woman had no children; however, her godchildren argued before the courts that she was under undue influence when writing these final two wills.

    They believed that the will from 2009, not the other two, represented her final intentions and should be valid. The defendants, the woman’s common-law spouse and his grandchildren, argued that the new wills expressed her mind and it represented her wishes. The new wills were similar in most aspects to the 2009 will; however, the new wills gave more to the common-law spouse and his grandchildren, at the expense of the godchildren’s shares of the estate.

    The Role of Legal and Medical Professionals

    On the day she wrote the first new will, she met with a doctor who confirmed her awareness of her terminal illness and her limited time left. The lawyer who helped prepare the will that day described her as very confused about why the lawyer was visiting and what he was doing with her affairs. The lawyer further explained that the woman could engage in conversation, had a clear memory of some things, but had troubles remembering things like the date and where she was. The woman also could not give the exact names of her grandchildren. Further, she was unable to answer the lawyer’s open-ended questions and needed prompts to give answers. The woman was clearly not in a sound mental state when she prepared the will.

    The lawyer and her two legal assistants confirmed no signs of confusion or misunderstanding from her on the day they signed the wills. The lawyer explained clearly that the will did not have to be changed unless she wanted to make specific adjustments. The judge needed to determine if her mental state resulted from her brain tumour, the stress of her terminal illness, or if her common-law spouse had unduly influenced her.

    Was This Proof of Undue Influence?

    The case facts suggest that her common-law spouse likely persuaded the woman to some extent to make these changes. While there may have been significant influence, the godchildren could not prove that there was undue influence – that she was expressing something that she did not really mean in her will. She had spent nearly 30 years with her spouse, and it made sense that she would want to include his grandchildren in her will.

    The judge explained that it’s not uncommon for people to rewrite their will after learning they’re terminally ill. People who are in this position tend to think about their estate and what will happen upon their passing. In the end, the burden of proof was on the godchildren to prove that the woman was under undue influence and they could not do this to the satisfaction of the courts. Even though the woman might not have been in the clearest mental state, there was no proof beyond a reasonable doubt that she didn’t intend to make these changes to her will. The court dismissed the undue influence claim, ruling that the woman had the necessary testamentary capacity to execute the wills and found no evidence of undue influence.

    What This Means for Future Cases

    This case helps to clarify how a claim for undue influence can be successful. Will-writing is stressful for most people, and it is assuring to know that final wishes will be honoured. In only the most extreme and conclusive cases will a court revise a person’s will. The doctrine of undue influence is meant to further ensure that will-maker’s true intentions are respected. If you think that someone you loved was under undue influence during their will making, contact an experienced estate lawyer today.

    For more information, read our page on proving an undue influence claim in BC.

    Have a question about this topic or a different legal topic? Contact us for a free consultation. Reach us via phone at 250-888-0002, or via email at info@leaguelaw.com.

  • The Will Isn’t Changed After a Divorce: is the Ex-Spouse Still Entitled to the Estate?

    The Will Isn’t Changed After a Divorce: is the Ex-Spouse Still Entitled to the Estate?

    When a married couple gets a divorce, the spouses sometimes forget to change their will to reflect this major life change – to remove the ex-spouse from their will. If a person divorces and doesn’t update their will, their ex-spouse might still receive the gifts mentioned in the old will. The rightful inheritors of this estate must seek legal remedy to correct the outdated will after the testator’s death.

    Revocation of an Ex-Spouses Entitlement in the Will

    According to BC’s Wills, Estates and Succession Act (WESA), a will is only revoked under specific circumstances. The testator revokes a will with the specific intention to do so. Neither marriage nor divorce can revoke a will, but this doesn’t guarantee the divorced spouse will receive the gifts from the outdated will. Further, the WESA states that: if a will-maker,

    1. Makes a gift to a person who was their spouse,
    2. Appoints as executor or trustee a person who was their spouse, or
    3. Confers a general or special power of appointment on a person who was their spouse, then

    the will-writer most likely intended to revoke the gift, appointment, or power of appointment. The estate must distribute the gift as if the spouse predeceased the will-writer.

    This means that ex-spouses will lose their right to anything under their ex-spouse’s will if they have separated. The courts will modify the will to distribute the estate assets as the will-writer intended, even if the will wasn’t updated. The WESA provision describes this as treating the ex-spouse as if they predeceased the will-writer.

    A spouse is presumed to have intended to disinherit their ex-spouse if there is no evidence indicating otherwise.

    If the will revokes a spouse’s gifts, those gifts go to the people already named in the will. The courts will try to adjust the distribution to reflect what the will-writer had intended, minus the entitlement to the ex-spouse. The courts appoint a new executor if the will named the ex-spouse as the executor.

    What Counts as an Ex-Spouse?

    In BC, there are two ways that people can be ruled spouses, when two people are legally married and when two people “[live] with each other in a marriage-like relationship for at least 2 years.” As outlined in the WESA, two people are no longer considered spouses if:

    1. In the case of a marriage, an event occurs that causes an interest in family property to arise, or
    2. In the case of a marriage-like relationship, one or both persons terminate the relationship.

    For the purposes of WESA, a married couple are no longer considered spouses when they have begun the divorce process. In the case of a common-law marriage, when one person terminates the relationship, they are no longer considered spouses. In either of these scenarios, the above procedures will be followed if the will-writer does not update their will to reflect the separation with their spouse.

    Sometimes, people separate from their spouses, but still want to give the ex-spouse part of their estate. In this case, the testator needs to be careful to specifically state in his/her will that he/she would still like their ex-spouse to be included in the will and to receive gifts. Without this provision, the spouse will not receive any gifts even if it’s in the will.

    While this WESA provision exists, it’s always best to avoid this by updating your will in the first place. If you’ve recently gone through a divorce, contact an experienced estate lawyer today to begin fixing your will to accurately reflect what you want done with your estate when you pass away.

    Have a question about this topic or a different legal topic? Contact us for a free consultation. Reach us via phone at 250-888-0002, or via email at info@leaguelaw.com.

  • Executors Quitting: Can an Executor Quit the Job of Administering the Estate?

    Executors Quitting: Can an Executor Quit the Job of Administering the Estate?

    The job of an executor is not easy; there’s a number of different responsibilities to prepare the estate for distribution. Many executors agree to take on the role without fully understanding the responsibilities and duties that it entails. Many executors feel overwhelmed and like they’ve taken on a second job once they start administering the estate. They sometimes wonder if they can quit and appoint someone else as the executor. If an executor has already started administration and wants to quit, they have limited options.

    Quitting After Administration has Already Begun

    Executors can receive executor’s fees to compensate for their work, even if the will doesn’t specify it.

    In short, no – executors can’t usually quit before they finish the job once the administration process has begun. Before an executor can leave their position, the courts must approve a petition for removal. This is only necessary if the executor has already started the estate administration process. If the executor has a valid reason for requesting removal, courts can grant it.

    An example of a valid reason could be an extreme personal health emergency. If you change your mind halfway through the administration process because it’s too difficult or you lack time, it’s not a valid reason to get removal as executor. To get a petition for removal approved by the courts, the executor must provide detailed accounts of all estate transactions. Essentially, they must leave the estate in a state where another person could easily take over.

    Other Options for Executors

    If the executor is in the middle of administering an estate and wants to quit, there are options available. Many executors choose to hire professionals to assist them. Depending on the specific issues the executor is having with the administration, accountants or lawyers can be very helpful. While the executor has the authority to handle the estate’s assets, others can assist them with their duties.

    If you’re an executor wanting to quit, simply stopping estate administration is not a good option. It could result in you being held liable for resulting losses. Beneficiaries of the will can take action to force the executor to speed up the process. If the executor continues to unduly delay the administration of the estate, they can be removed and held personally liable for any losses suffered by the beneficiaries as a result of the mishandling of the estate. Leaving the executor’s duties untouched is never a good option for an executor, and an executor who finds themselves at their wits end should seek professional assistance with their duties.

    Resigning Before Administration has Begun

    Before being legally appointed executor of the will, the named executor can resign from their role. As described in section 104 of the Wills, Estates and Succession Act, this is called renunciation of executorship. The executor does not need to provide any reason for resigning; they simply must file an official document with the courts. After renunciation of executorship, the executor can’t “go back” and try to gain executor status at a later time. If there is an alternate executor named in the will, they will be appointed the duties of executor. If there is not, an interested party can apply to be the administrator, similar to the process of an executor being chosen in an intestate estate.

    When the will-writer is still alive, it’s easiest to simply notify them that you do not want to be their executor after they pass away. This way, the will-writer has the option to name someone else who they want to be their estate’s executor, avoiding a lengthy renunciation of executorship and reappointment process after their death. You will not have to file any official documents with the court if the will is changed to name someone else as the executor.

    If you’ve been named as an executor of an estate and you do not want to take on this role, contact an experienced lawyer today. We can work to ensure that you are lawfully removed as executor when it’s an option, or help to make the administration process as easy as possible.

    Have a question about this topic or a different legal topic? Contact us for a free consultation. Reach us via phone at 250-888-0002, or via email at info@leaguelaw.com.

  • Will Challenges Affect All Children, Even Those Not Challenging

    Will Challenges Affect All Children, Even Those Not Challenging

    BC has some of the most favourable estate laws for children who have been unfairly disinherited by their parents. The courts insist that parents provide ‘adequate provisions for the proper maintenance and support’ of their children unless they have legally valid reasons to not do so. When children believe they’ve been unfairly disinherited, they can challenge the will. Some might be surprised to know that under s.61(4) of the Wills, Estates and Succession Act, the courts will treat any will variation challenge as a proceeding on behalf of all the children, even those not directly involved in the challenge.

    Will Challenges on Behalf of All the Children

    When one child begins a will challenge, it is likely that all of the children will be impacted. Some children could be left with less inheritance than expected, while others are given more of the estate.

    In order to disinherit someone, the will-writer must have a reason that is valid, rational, and consistent with modern Canadian values.

    The most common type of will challenge arises when a parent completely disinherits one child, but splits the estate equally amongst their other siblings. The child challenges the will before the courts, who may modify the will to make provision for the disinherited child. The other children are usually opposing the challenge, defending their case. In these instances, the children are usually arguing on their own behalf trying to maximize their inheritance.

    In some cases, a child who defends against a will challenge might even benefit from the variation of the will. The case of Graham v. Chalmers (2010) shows how this might happen in BC.

    Defending Against Yourself?

    In the case of Graham v. Chalmers, the will-writer, Delores, had named her two children, Janet and Sandi, and her two grandchildren as beneficiaries of her will. Delores had a legal obligation to provide an adequate, just and equitable provision to Janet and Sandi, though there was no legal obligation to give an inheritance to her grandchildren. Delores elected to equally distribute the estate amongst the two children and two grandchildren, 25% each. However, Janet found this distribution problematic because both of the grandchildren were Sandi’s children. In essence, 75% of the estate was being given to Sandi’s “side of the family” and 25% to Janet’s.

    Janet challenged the will, claiming that she was not given enough of the estate. The courts considered what ‘adequate provision’ means in this scenario, and concluded that the will did not provide adequately for Janet. The will was varied to give Janet and Sandi each 40% of the estate, and the grandchildren 10% each. In this case, Sandi was defending the claim as the executor, however, she ended up benefitting from the successful challenge. Instead of receiving 25% of the estate, she ended up with 40%.

    An Example From Case Law

    In Bowling Estate (Re) (2022), the BC Supreme Court considered an application from a beneficiary who had sought legal advice when the executor ignored their questions about the estate administration. The deceased had appointed one of her four children as executor, and divided the estate equally among the children. Administration was somewhat delayed, as it took over one year to receive a grant of probate. However, the estate wasn’t complicated as there wasn’t conflict between children regarding their shares, and the estate was mostly liquid.

    One year after probate was granted, one of the siblings asked the executor questions about the administration, and was ignored. The executor never answered these questions, or explained why she was ignoring them. The executor began distributing assets from the estate, and her sibling continued to ask questions about the administration. Eventually, the sibling retained a lawyer, hoping to force the executor to answer her questions transparently and provide estate accounts. Both the executor and the sibling claimed costs ranging from $10,000 to $11,500 for their expenses relating to the application and the formal passing of accounts.

    The Opinion of the Court

    In general, reasonable legal fees related to estate administration are covered by the estate. The judge had to consider if the executor’s conduct was so improper that she should not be able to recover her legal expenses from the estate, and if it was reasonable for the sibling to recover her $11,500 in legal fees for bringing the application. The judge pointed out that there were two other siblings who had chosen not to participate in the application, who had no objections to the administration or the formal accounts. They would be adversely impacted by an order to assign costs to the estate, as it could lower the total value of their respective shares by up to $5000. 

    The significant impact of an order for costs upon the other beneficiaries was a key reason for the court’s decision. The judge ordered that the executor could only recover $6000 from the estate, and was liable for the remaining $4000. Finally, the court acknowledged that the sibling had acted reasonably in her concern for the executor’s lack of communication, but pointed out that the conflict could have been resolved outside of court. Because the sibling consented to the formal accounts, the litigation only took place because the sisters couldn’t agree on costs. The court ordered the executor to personally pay $6000 to her sibling in costs.

    Ultimately, the executor was personally liable for her unreasonable delay and lack of communication to some degree. However, the court was clear that conflicts of this nature, particularly where are beneficiaries will suffer as a result of the conflict, should be resolved outside of court where possible.

    Reminders for Beneficiaries

    As a beneficiary, you can still be impacted by a will variation challenge that you are not directly involved in. If other beneficiaries claim they’ve been unfairly disinherited, you should be prepared to lose parts of your inheritance. Any will challenge in BC will proceed on behalf of everyone who may have been unfairly disinherited or unjustly compensated. If you’re unsure how you might be affected by a family member’s will challenge, contact an experienced estate lawyer today.

    Have a question about this topic or a different legal topic? Contact us for a free consultation. Reach us via phone at 250-888-0002, or via email at info@leaguelaw.com.

  • Unconscionable Procurement: Setting Inter-Vivos Gifts Aside

    Unconscionable Procurement: Setting Inter-Vivos Gifts Aside

    Unfortunately, when a person nears the end of their life, it’s not uncommon for family members or close friends to exploit the situation for financial gain. This can involve exercising undue influence on the will-writer to leave large gifts in their will, or misleading them into changing their will to reduce or exclude someone else’s inheritance. Affected beneficiaries may be able to challenge a will if interference caused it to misrepresent the writer’s true wishes. But, what about gifts given under similar circumstances before the will-writer passes?

    Unconscionable Procurement

    The doctrine of unconscionable procurement protects the intentions of the gift giver in significant wealth transfers. The courts can void transfers if the gift giver didn’t fully understand the decision or if the recipient misled them. For the courts to void a wealth transfer due to unconscionable procurement, it must be shown that:

    • The person receiving the gift obtained a significant benefit 

    And

    • The person receiving the gift played an active role in arranging the transfer of the gift

    The courts will consider the value of the gift, and the level of involvement the receiver had in arranging the transfer. Examples of over-involvement in the arrangement of the transfer include:

    • If the gift receiver prepared documents for the gift giver to sign;
    • The gift receiver arranging for the gift giver to meet with a lawyer who has already received instructions; 
    • Driving the gift giver to meet with a lawyer regarding the transfer, or to a bank to make a withdrawal

    Recent Case Argues Unconscionable Procurement

    Courts can declare that agreements signed under undue influence or unconscionable procurement are void.

    While the doctrine of unconscionable procurement had fallen out of use, it was recently argued successfully in the 2019 case, Gefen v. Gaertner, (2019). In the case, two brothers sought to void several wealth transfers between their mother and another brother. Their father had already passed away, and the estate assets were left entirely to their mother. The three sons were meant to inherit equal ⅓ shares of their parent’s assets upon their mother’s death. However, through numerous inter-vivos gifts, their mother had gifted a significant portion of the remaining estate assets to one son. These gifts significantly decreased the value of the remaining ⅓ shares for the other two.

    The two brothers used the unconscionable procurement claim to undo the wealth transfers and place the assets in trust. Placing the assets in trust would ensure that the issue couldn’t happen again. The court sided with the two brothers, ruling that the third brother had unconscionably procured the gifts. Evidence showed that he actively arranged the transfers, prepared documents for his mother to sign, and gained significant financial benefits.

    Key Takeaways From the Case

    The successful argument of unconscionable procurement in this case is important, as it opens a new avenue for voiding inter-vivos gifts in estate claims, where the more common approaches of claiming undue influence or lack of capacity might fail. In Gefen v. Gaertner, the Court noted that a doctor had assessed the mother, and she had legal capacity to make the transfers. The court also did not find the transfers were voidable as a result of undue influence, however they were voidable due to the unconscionable procurement of the gifts.

    3 Approaches to Voiding Inter-Vivos Gifts

    Courts can make inter-vivos gifts voidable under certain circumstances, like in the case of Gefen v. Gaertner. People usually challenge these gifts with claims of undue influence or lack of capacity. How do these types of claims differ?

    1: Undue Influence

    These claims can render gifts voidable in situations where “A person is pressured to perform a legal act, and where that person does not truly wish or intend to perform that act.”

    •  For example, if the receiver of the gift threatens the gift giver to pressure them into making a wealth transfer, the wealth transfer may be ruled voidable.

    2: Lack of Testamentary Capacity

    This renders gifts voidable if the gift giver did not have legal capacity at the time of the transfer. 

    • A common example of gifts being voidable due to lack of capacity are gifts given by a parent or grandparent who suffers from severe memory loss. 

    3: Unconscionable Procurement

    This principle makes transfers voidable if the gift giver was mislead into making the transfer, or otherwise did not understand the effects of their actions. The gift receiver must have been directly involved with arranging the transfer.

    • For example, in Gefen v. Gaertner, the court ruled that the brother unconscionably procured the assets because the gift giver didn’t fully understand her actions, and the brother went to great lengths to arrange the transfers.

    If you suspect that a loved one has been mislead or unduly influenced to give a large gift that they may have not intended or wished to, contact an experienced estate lawyer today.

    Have a question about this topic or a different legal topic? Contact us for a free consultation. Reach us via phone at 250-888-0002, or via email at info@leaguelaw.com.

  • Unconscionable Procurement: Voiding a Gift

    Unconscionable Procurement: Voiding a Gift

    As part of their estate plan, people often elect to give inter-vivos gifts to their loved ones. This can help to minimize probate fees, and to allow loved ones to enjoy their inheritance earlier. Many testators may not realize that there are several reasons the courts may deem an inter-vivos gift invalid. For example, a gift of real estate may be considered imperfect if it was not officially registered with the Land Title and Survey Authority of BC, making the gift void.

    A less common reason for voiding an inter-vivos gift is the doctrine of unconscionable procurement. If someone doesn’t fully understand their actions when making an inter-vivos gift, the doctrine of unconscionable procurement can make the gift voidable. This equitable doctrine protects vulnerable gift-givers from being exploited.

    When the Doctrine of Unconscionable Procurement can be Enacted

    A gift-giver must have an intention to make a gift in order for the gift to be valid.

    The doctrine of unconscionable procurement is intended to protect against undue influence. It applies when a gift transfer is arranged by the recipient and doesn’t reflect the giver’s true intentions. In these cases, the gift giver may not fully understand what’s happening or the nature of the transaction. It’s important to note that a successful claim doesn’t automatically void the gift—it makes the gift voidable.

    In order to have a successful unconscionable procurement claim, there are two primary elements that must be found:

    1. One person receives a gift from another; and
    2. The recipient of the gift was actively involved in the process of receiving the gift, and arranging the transfer.

    When these criteria are met, it raises suspicion that the gift-giver may not have fully understood the gift. At this point, the burden of proof shifts to the defendant. They must show, on a balance of probabilities, that the gift wasn’t unconscionably procured. This means that they must provide evidence which demonstrates that it is more likely than not that the gift giver understood the nature and consequences of the transfer, and intended to make it.

    A Case Which Demonstrates This Doctrine

    In the case of Gefen v. Gaertner (2019), a handful of gifts were voidable under the doctrine of unconscionable procurement. The deceased mother had elected to give more than 50% of her estate in inter-vivos gifts to one of her three children. The two children decided to challenge the transactions under the doctrine of unconscionable procurement. As described in the case, unconscionable procurement requires that a “person who obtains a benefit from another by voluntary donation must establish that the donor did so voluntarily and deliberately, knowing what they were doing.” The two children were able to successfully prove the two elements of unconscionable procurement, showing that their mother did not make these gifts voluntary and deliberately.

    While not always the case, it is common for elderly people to give gifts that have been unconscionably procured. If the recipient of the gift is overly involved and pushing to receive a gift, this could be grounds for an unconscionable procurement claim.

    If you or a loved one have been wronged through an unconscionably procured gift, contact an experienced estate lawyer today. We will help to ensure that you receive the inheritance you’re entitled to, even if that means making the gift voidable.

    Have a question about this topic or a different legal topic? Contact us for a free consultation. Reach us via phone at 250-888-0002, or via email at info@leaguelaw.com.

  • Hotchpot Clause: Unpaid Loans Causing Estate Disputes

    Hotchpot Clause: Unpaid Loans Causing Estate Disputes

    It’s not uncommon for people to make loans to their family or close friends. Common reasons include helping with a down payment on a house or to kickstart a new business venture. However, many people don’t consider what would happen if the lender dies before the borrower repays the loan. To avoid uncertainty, will-writers who are owed a debt from a beneficiary of their estate can include a hotchpot clause in their will.

    What is a ‘Hotchpot’ Clause?

    A hotchpot clause requires the executor to consider any debts or advances owed by a beneficiary when administering the estate. Essentially, the clause ensures that any assets lent to a beneficiary before the testator died do not have an unfair effect on the other beneficiaries of the will. Typically, the beneficiary who had the loan will have their inheritance reduced by the value of the balance when the testator died. This helps to ensure fairness for beneficiaries who have an equal share in the estate, but did not receive equal assistance from the will writer during their lifetime.

    How Unpaid Loans Can Create Estate Disputes

    To fully understand this problem, let’s consider the following example:

    Imagine a father has three children and wants to divide his $900,000 estate equally among them. One of his children borrowed $100,000 from him before he passed away. The father’s will includes a hotchpot clause that requires the loan to be factored into the distribution. Without the hotchpot clause, each child would receive $300,000.

    With the clause in place, the value of the estate would be considered $1,000,000 after the child ‘repaid’ the loan. Each child’s share would be valued at approximately $333,333. However, the child that borrowed money would have their inheritance reduced by the balance of the loan. In this example, they would receive a smaller sum of $233,333. This ensures fairness amongst the siblings by accounting for the money already received by the child who had the loan.

    Many people in a similar scenario might assume this common-sense approach would be taken. However, without documentation in the estate plan, it’s unclear which solution the father had intended in his will. If it is not clear how the will writer intended the debt to impact a beneficiary’s inheritance, disputes can arise. It’s important that testators who have lent money to a beneficiary make their plans for the debt clear in their will.

    Using a Hotchpot Clause to Prevent Disputes

    A hotchpot clause’s purpose is to help ensure fairness and equality amongst beneficiaries.

    A hotchpot clause ensures the executor accounts for any amounts a beneficiary received from the will-writer before their death when determining their inheritance. Usually, the clause will accumulate the value of all of the estate’s assets, including any debts owed to the estate. The goal of a hotchpot clause is to equalize the overall benefit that each beneficiary receives from the estate.

    Loan vs. Gift

    In general, if you’re going to issue a loan, whether it’s to your own children or to a third party, you should always create a written agreement. Without a contract, the debtor could argue that the loan was intended as a gift. In this case, the hotchpot clause would likely not be relevant, as the gift would have no impact on the estate as an inter vivos gift and the debtor would have no obligation to repay the gift. A written contract specifying that the money transfer was a loan, not a gift, reduces litigation risk during estate administration. With a written agreement and a hotchpot clause, will-writers can ensure no one unfairly benefits from the loan at the expense of other beneficiaries’ inheritance.

    If you’re unsure how to include a hotchpot clause in your will, contact an experienced estate lawyer today.

    Have a question about this topic or a different legal topic? Contact us for a free consultation. Reach us via phone at 250-888-0002, or via email at info@leaguelaw.com.

  • Residency, Domicile & Estate Law

    Residency, Domicile & Estate Law

    People are increasingly mobile – many are born in one country, go to school in another, and retire abroad. After living in a number of different countries, legally, where is home? While the answer might seem obvious to you, this question can have huge implications when it comes to estate law. The place of one’s permanent home in legal terms is called their domicile. This determines which country or province’s laws will apply to your estate when you pass away. Whether you know where it is or not, everyone has a domicile, and only one domicile.

    A person’s domicile is not always simply the place where they were born or the place where they currently live. Someone might have been born in one country, but lived somewhere else for their entire life. On the other hand, someone might move to a different country for school, with no intentions of staying there. Because of this, courts must consider various factors to determine a person’s domicile. A recent case in BC questioned a deceased’s domicile, asking the courts to determine where his domicile really was.

    What Your Domicile Means For Your Estate

    You are never domiciled to Canada per se; rather you are domiciled to an individual province because each has different laws.

    The case of Sato v. Sato (2018) highlighted the impacts that a domicile has on an estate law case. Sato was born in Japan and lived in Toronto, Vancouver, the Cayman Islands, Guernsey and Luxembourg throughout his lifetime. He typically returned to BC every couple of years while he was living abroad.

    In 2009, he settled down and moved to Luxembourg which is where he lived when he eventually died in 2015. Shortly after he moved, in 2011, he visited BC where he then wrote his final will. Later, in 2013, while living in Luxembourg, Sato got married. This was where the controversy arose, as the courts looked to determine where he was domiciled at the time of the marriage. Since this was before the Wills, Estates and Succession Act was enacted, if Sato was domiciled in BC, the marriage would revoke his will. If he was domiciled in Luxembourg, his will would not be revoked.

    How Domicile is Determined

    The courts in Sato v. Sato (2018) used two factors when determining someone’s domicile:

    1. Where the individual resided at the time of death; and
    2. The intention to make the place of residence a permanent home, indefinitely.

    Since Sato lived, worked and filed taxes in Luxembourg, it was clear to both parties of the case that he was a resident of Luxembourg. Commonly, as was the case here, it was the second point of the criteria that was in dispute. The courts questioned whether “the intention of permanently settling there … in the sense of making that place [one’s] principal residence indefinitely” was apparent for Sato and his home in Luxembourg. It was shown from past records that Sato actually had an intention of retiring in Canada. Because there was no evidence to the contrary, it was decided that even though he resided in Luxembourg, he had no intention of having a permanent home there. It was ruled that Sato’s domicile was in BC and as a result his will was revoked because of his marriage in 2013.

    No Intentions of Permanent Residency

    Sometimes, it’s impossible to determine whether an intention to make somewhere an indefinite, permanent home is evident. When this is the case, the courts will use the domicile of origin, in other words where the person was born. A recent case in Saskatchewan, Vanston v. Scott (2014), featured a son challenging a father’s will, with the son claiming that father was actually domiciled in BC. The defendant argued that the deceased was rightfully domiciled in Saskatchewan. In the end, the plaintiff could not show the deceased had the intention of returning to BC, to it his eventual permanent home and the defendant was unable to show that the deceased had not abandoned Saskatchewan as his permanent home. The courts used the domicile of origin to determine the correct jurisdiction of his estate which was neither Saskatchewan nor BC, but rather his birth province of Alberta.

    The location of someone’s domicile can be confusing as it can change often throughout their lives. If you’re unsure where your domicile would be and want to make your intentions of permanent residency clear, contact an experienced estate lawyer today as it can have significant impacts on the administration of your will.

    Have a question about this topic or a different legal topic? Contact us for a free consultation. Reach us via phone at 250-888-0002, or via email at info@leaguelaw.com.

  • Who is Entitled to Receive a Copy of the Will?

    Who is Entitled to Receive a Copy of the Will?

    Although wills are private documents, there are a number of people who may be entitled to a copy. Executors are responsible for distributing these copies, as they are in possession of the original will. However, many executors are unsure who is entitled to a copy of the will. Unfortunately, it’s not uncommon for executors to make mistakes in distributing copies.

    Before the Will-Writer has Passed Away

    Before the will-writer has died, they are the only person legally entitled to a copy of their will. The will-writer can choose to keep the will confidential, but they can also give copies to anyone they would like. Even though it’s fully in the will-writer’s rights to not release any copies of the will, it’s recommended that the executor is either given a copy or knows exactly where the original will is to prevent any confusion upon the death of the will-writer. The executor will need to be in possession of the will in order to administer the estate. Once the will-writer has passed away, several different people become legally entitled to receive a copy of the will, should they request one.

    After the Will-Writer has Passed Away

    In BC, a will that has been granted probate becomes public record for anyone to see.

    After the will-writer has passed away, the executor of the will is usually the person who is given the original copy of the will, and they will be responsible for giving out copies of the will to those who are entitled.

    People who are entitled to a copy of the will in BC include:

    • The executor of the will,
    • Beneficiaries of the will (those who will inherit a part of the estate),
    • People not named in the will, with a minor child as a beneficiary, and
    • People who are owed money by the testator.

    It is common for people to be unsure if they’re a beneficiary of the will following the passing of a testator. In this case, the executor must disclose if they’re a beneficiary or not.

    Some additional scenarios when people might be legally entitled to receive a copy of a will include:

    • Professionals involved in the estate administration such as financial advisors or lawyers,
    • Immediate family members of the testator,
    • People named in the will, who are not beneficiaries,
    • People named in older versions of the will, but not in the final will, or
    • People who did not, but would have inherited part of the estate if the testator failed to write a will.

    Reminders for Interested Parties

    If you believe that you should be entitled to a copy of a will, but don’t fit into this list, you may still be able to receive a copy. If you can demonstrate to the courts that you have legally valid reason to be given a copy of the will, you can be granted entitlement to a copy.

    For those entitled to a copy of the will, it can sometimes be easiest to ask a layer who is in possession of a copy of a will when trying to obtain a copy. It is common for executors to be unsure of who is entitled to a copy of a will and who is not. Estate lawyers will understand this and can provide you with a copy if you’re legally entitled.

    If you believe you’re entitled to a copy of the will, but the executor is refusing to provide one, you may need to issue a subpoena to receive a copy. A subpoena forces an executor to deliver a copy of the will to you. Contact an experienced estate lawyer today to begin solving your estate-related problem sooner rather than later. We will ensure that you receive a copy of the will if you’re entitled to it.

    Have a question about this topic or a different legal topic? Contact us for a free consultation. Reach us via phone at 250-888-0002, or via email at info@leaguelaw.com.