A recent decision out of the Ontario Superior Court of Justice serves an important reminder of the difficulties that can arise in interpreting and implementing a will when the life circumstances of a testator change after preparing the will.
In Stuart v Stuart, 2019 ONSC 4328, the Court dealt with the interpretation of a will prepared by a testator in 1999. At the time of preparing the will, the testator was married and lived in a property he and his wife owned as tenants-in-common. Although they remained married and did not indicate any intention to separate, the testator eventually required placement in a long-term care facility.
The testator’s wife subsequently decided to sell the property she and her husband had lived in together and purchased a life lease housing interest (see here a guide from Ontario’s Ministry of Municipal Affairs and Housing for more on these arrangements). The wife purchased the life lease as tenants-in-common with the testator, but he never resided there as he remained in long-term care.
The testator eventually died and sometime after his death, the wife sold the life lease interest and deposited half the proceeds of sale into the testator’s estate. After the wife’s death, Directions were sought by the Estate Trustee with respect to the interpretation of the following provision of the will:
3(h) To allow my wife, during her lifetime, the use and enjoyment of whatever interest I may own in any residence we may occupy at the time of my death. My Trustee may, at any time, with the consent of my wife, sell such interest with the proceeds of such sale assist in the purchase of another residence for the use and enjoyment of my wife as aforesaid and so on from time to time, always retaining the proportionate share in such residence for my estate. If my wife so prefers, my Trustee may sell such interest in the residence and hold the net proceeds of sale in trust for my wife as hereinafter set out. If, during any period, the whole or any part of the proceeds of any such sale be not so used, they shall be invested by my Trustee and my wife shall, during such period, be entitled to the net income therefrom. My Trustee in determining the proceeds of sale of any such interest in the residence with a view to providing another interest in the residence for my wife as aforesaid, shall not deduct the amount of any debts secured thereon.
Because the husband had still been alive at the time that the home he shared with his wife was sold, the questions was whether paragraph 3(h) of the will remained operative as the husband never resided in the subsequent property that he and his wife owned at his time of death.
The Court applied the armchair rule to “assume the same knowledge [the testator] had to the nature and extent of his assets, the makeup of his family, and his relationship to its members.” The Court found that the testator and his wife remained married and were separated only due to the testator’s health. Had he not been in long-term care, he would have resided with the wife. The Court then found that the testator’s primary intention, from his will, was that his wife was properly cared for after his death such that he “clearly wanted his wife to be able to remain living in whatever home she and he, but for his medical condition, would have been living in at the time of his death.” The Court therefore found that the terms of the will allowed the wife to reside in the subsequently purchased home, despite the testator never having lived there.
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