Property, Conditions & Public Policy
The recent case of Spence v. BMO Trust Company, 2015 ONSC 615 (Ont. S.C.J.) has sparked a renewed interest in how “public policy” may affect the law of wills & estates. It’s an opportune time to review the basic doctrine respecting testamentary gifts that are subject to conditions which are void for reasons of public policy. If we are to turn to policy considerations to guide the development of doctrine, we should be mindful or when and how we include such considerations into the analysis.
The best known case is probably Blathwayt v. Baron Cawley,  1 A.C. 397 (H.L.). Here the testator included a condition that if the beneficiary ‘should (a) be or become a Roman Catholic or (b) disuse the surname and arms of Blathwayt’ any entitlement would be forfeited. Lord Wilberforce said:
2. Finally, as to public policy. The argument under this heading was put in two alternative ways. First, it was said that the law of England was now set against discrimination on a number of grounds including religious grounds, and appeal was made to the Race Relations Act 1968 which does not refer to religion and to the European Convention of Human Rights of 1950 which refers to freedom of religion and to enjoyment of that freedom and other freedoms without discrimination on ground of religion. My Lords, I do not doubt that conceptions of public policy should move with the times and that widely accepted treaties and statutes may point the direction in which such conceptions, as applied by the courts, ought to move. It may well be that conditions such as this are, or at least are becoming, inconsistent with standards now widely accepted. But acceptance of this does not persuade me that we are justified, particularly in relation to a will which came into effect as long ago as 1936 and which has twice been the subject of judicial consideration, in introducing for the first time a rule of law which would go far beyond the mere avoidance of discrimination on religious grounds. To do so would bring about a substantial reduction of another freedom, firmly rooted in our law, namely that of testamentary disposition. Discrimination is not the same thing as choice: it operates over a larger and less personal area, and neither by express provision nor by implication has private selection yet become a matter of public policy.
The policy balance here is between the preservation of proprietary freedoms on the one hand with providing redress for sufficiently offensive conduct on the other. Lord Wilberforce’s dicta in the Blathwayt judgment takes a very traditional approach. Private discrimination on religious grounds may be unpalatable, but is not against the public interest in the same way that the Canadian Charter of Rights and Freedoms does not govern relations between private parties. And yet the Charter does not elevate proprietary entitlements to the level of a fundamental right or freedom, so one must be careful in how how extensive a reading one gives to property rights.
A more dynamic approach might be one that begins with where the public interest is front and centre; for example, in the law of charitable trusts. We defer to such trusts generally. The rule against perpetuities does not apply, nor does the beneficiary principle. A court may rescue such trusts through the exercise of its cy-pres jurisdiction. Equity Favours Charity, and so on. Lord Wilberforce, in my view, was quite right to say that “conceptions of public policy should move with the times” but it does make me somewhat uneasy to introduce idiosyncratic judicial standards of fairness or policy into an area that is otherwise as private as private can be – not because I favour giving a bye to discrimination, but rather because I fear both getting things wrong. Is it discriminatory for a testator to follow religious or ethnic tradition while still providing for dependants? In my view, this is a really hard question and such matters are best left to the legislature or if we ever have the good sense to create something like the Charity Commission which regulates charities in England & Wales (which is a question for another day).