The principle of testamentary freedom is intrinsic to Canadian law. There are exceptions, such as when a provision of a will is contrary to public policy. However, beyond that, there are situations where a testator’s freedom to do as they wish with their estate may be limited. 

A recent case out of British Columbia, Angelis v Siermy, 2022 BCSC 31, concerned a dispute over a testamentary contract. In short, a testamentary contract is an agreement whereby a testator agrees to leave a part, or even the whole, of their estate to a person in exchange for consideration.  

A common form of testamentary contract is a mutual will, whereby two parties agree not to revoke their wills after the death of the other party. This can raise interesting issues, as discussed in one of our previous blogs.  

In this case, the plaintiff, a niece of the testatrix, claimed that she had an oral contract with her aunt, whereby she was entitled to the bulk of the estate in return for having provided years of free labour for her aunt’s business. An unusual detail, in this case, was that the aunt was still alive at the time the claim was made, and denied the existence of the oral agreement.  

With no corroborating witnesses and only three letters, allegedly written by the aunt, none of which directly confirmed the existence of the oral agreement, the court ruled that there was no enforceable contract.  

In Ontario, testamentary contracts are permissible; however, it should be noted that these have limits, and the remedies to enforce them are found in contract law rather than the law of wills and estates. Further, such contracts may not be effective in shielding the estate from dependant claims where the value of the property exceeds the value of the consideration given for it.  

A testamentary contract inevitably creates complex interactions between contract, estate, family and other areas of law. The decision to enter into one should be made with caution and consultation with relevant professionals, as the consequences and enforceability of such contracts may be unpredictable. Nonetheless, they can certainly be useful tools and remain in use. 

Thank you for reading and have a great day! 

Ian Hull & Raphael Leitz