Author: Paul Emile Trudelle

30 Jul

Funeral Pre-Planning: Take a Lesson From a Pirate

Paul Emile Trudelle Estate Planning, General Interest Tags: , , 0 Comments

Sailors, and in particular, pirates are often depicted as wearing gold earrings. There are many legends as to why they adopted this particular fashion statement. One has a clearly estate-related basis.

Sailors were often given earrings to commemorate certain sailing milestones, such as crossing the equator or rounding the treacherous Cape Horn. Superstition also played a role, as many believed that gold earrings would improve their eyesight, prevent seasickness or even drowning. Wax was often pressed onto the earrings, which could serve as earplugs when firing a cannon. Another theory is that the gold earrings were just a way for pirates to show off their wealth.

From an estate planning point of view, sailors would wear valuable earrings so that their funerals could be paid for if their bodies washed ashore. If a pirate died on the ship, the value of the earrings could be used to cover the cost of transporting their body back home, so as to avoid a burial at sea (assuming that there is honour amongst thieves, and that the earrings were used as intended).

Actor (non-pirate) Morgan Freeman sports gold earrings. He has been reported as saying that his earrings are worth just enough to pay for a coffin in case he dies in a strange place.

Preplanning a funeral is always a good idea. It alleviates significant stress, both financial and emotional, on those left behind. It also allows the planner to ensure that they are given the burial they want. Take a lesson from a pirate: make a plan.

Thanks for reading. Have a great weekend.

Paul Trudelle

23 Jul

Olympic Medals: Going for the Gold

Paul Emile Trudelle General Interest, In the News Tags: , , 0 Comments

Finally, the 2020 Olympics appear to be about to begin (at the time that this is being written).

The Tokyo Olympics will have 339 medal events. Approximately 5,000 medals have been minted. The medals are made from recycled materials.

This year, for the first time in recent memory and due to COVID concerns, athletes will be putting their medals around their own necks.

According to International Olympic Committee regulations, each medal must contain a depiction of Nike (the Greek goddess of victory, not the swoosh), the official name of the Games  (eg. XXXII Olympiad Tokyo 2020) and the Olympic five rings symbol.

Although the medals are probably priceless to the winner, they do have an actual value. The cost of the materials used to make the medals is said to be $1,010 CDN for a gold medal, $640 CDN for a silver medal, and $5 CDN for a bronze medal. The gold medal contains six grams of gold plating over silver, the silver medal is all silver, and the bronze medal is made of brass. The Olympic Committee stopped giving out pure gold medals after the 1912 Olympics.

The medals clearly have a value beyond their cost to produce. Most notably, one of Jesse Owens’ 4 gold medals from the 1936 Berlin Olympics was sold in 2013 for over $1.4m US.

On eBay, an original silver medal from the 1906 Olympic Games is available for $15,289 CDN. Replica medals from most Olympic Games are available on eBay for about $35.00 CDN.

In addition to having value in and of themselves, Olympic medals often come with a hefty bonus from the winner’s country. Singaporean winners get $1m, $500,000 or $250,000 US for bringing home a gold, silver or bronze medal. Canadian winners get $20,000, $15,000 or $10,000 depending on where they are on the podium.

For the intriguing story of the 1972 Olympic gold medal basketball game and what lead to a term in the will of competitor Kenny Davis prohibiting his descendants from ever accepting the silver medal from the 1972 Games, see Ian Hull’s blog, here.

May you be faster, higher, stronger this weekend.

Paul Trudelle

16 Jul

Bequesting What You Don’t Have: Ademption

Paul Emile Trudelle Estate & Trust, Estate Planning, Wills Tags: , , 0 Comments

“Ademption occurs when the property which is the subject of a specific gift, although in existence at the date of the will, is not in the testator’s estate at his death. It may have been sold or given away by the testator, or it may have been lost, stolen or destroyed. In the absence of a statutory provision to the contrary, if a specific gift has adeemed, the beneficiary gets nothing.”

This explanation of ademption comes from Oosterhoff on Wills, 8th ed. (Toronto: Carswell, 2016) at 538, as quoted in Best v. Hendry, 2021 NLCA 43 (CanLII).

In Best, the issue of ademption was front and center. The testator left a will that provided that her house was to go to her niece Hendry, and the residue of her estate was to go to her niece Best. Many years after making the will, the testator developed dementia, and was moved from her home to a nursing home. Best applied to be her guardian, and proceeded to sell the home.

Upon the testator’s death, Best claimed that the gift of the house adeemed, and the proceeds of sale fell into the residue. The Newfoundland Court of Appeal agreed.

In Ontario, recourse to ss. 35.1 and 36 of the Substitute Decisions Act may have applied. Section 35.1(1) provides that a guardian shall not dispose of property that the guardian knows is subject to a specific testamentary gift in the incapable person’s will. Section 35.1(3) allows for the disposition of the property if it is necessary to comply with the guardian’s duties. However, s. 36 provides that the doctrine of ademption does not apply to such dispositions by the guardian, and that the beneficiary is entitled to receive from the residue of the estate the proceeds of disposition, without interest.

According to the decision in Best, only Ontario and B.C. have such anti-ademption legislation.

(Best also dealt with issues relating to a release initially signed by Best, the liability of the estate trustee to Best, and the right of the estate trustee to recover funds improperly paid to a beneficiary (Hendry). I will not address those here.)

This brings me to my favourite ademption joke. A testator went to a lawyer to prepare his will. He told the lawyer that he wanted to make a bequest of a house to his loving wife, a cottage to his two loving sons, and a Frisbee collection to his loving dog. When the lawyer reminded the testator that he did not have a house, a cottage or a Frisbee collection, the testator responded: “Well, that’s their problem. I’ll be dead by then.”

Have a great weekend.

Paul Trudelle

09 Jul

Small But Difficult Estates

Paul Emile Trudelle Litigation Tags: , , 0 Comments

Administering an estate can be problematic, regardless of the size of the estate. Even small estates can be fraught with administrative difficulties that can arise by reason of actions or inactions of the deceased, issues as to the relationship between the surviving beneficiaries, or both.

The matter of Gibbons v. Lemont is a good example of the problems that can arise, and their reasonable resolution.

There, the deceased was survived by her three children. In her will, the deceased appointed two of her children as estate trustees.

The estate was a relatively small one, consisting of a house having a value of $100,000 at the time of death. The low value was partially attributed to the fact that the deceased was a hoarder.

To complicate matters, the two estate trustees had a strained relationship with their brother. The brother took issue with the actions of the estate trustees, which lead to a trial and a decision. The decision reflects some of the difficulties in dealing with estates, small or large, and addresses ways of dealing with those issues.

Of note:

  1. The trial proceeded by way of a summary procedure. Affidavits were relied upon in lieu of examinations in chief, and cross-examination was limited. The judge observed that “the parties were well advised not to run up the costs by days of evidence and cross-examinations.” However, in the same paragraph, the judge notes that as a result of the extremely limited cross-examination, the judge did not have any assistance in making determinations as to credibility and reliability.
  2. Rather than sell the home “as is”, the estate trustees spend thousands of hours cleaning and repairing the house to prepare it for sale. This resulted in a gain in the value of the house of approximately $70,000. But for this work, there would probably have been no estate to distribute after the mortgage was paid. The judge commended the estate trustees for their efforts, and observed that in hindsight, the estate trustees might have been better off in declining to act, and to let the mortgagee take enforcement proceedings and sell the property.
  3. With respect to the time spent to clear, clean and improve the real property, the court found that the estate trustees were entitled to compensation for their work. While the deceased’s will expressly provided that the estate trustees were not entitled to compensation for acting as estate trustees, the work done by the estate trustees went beyond the work reasonably expected of an estate trustee.
  4. The brother alleged that the estate trustees unfairly and unequally distributed the deceased’s personal effects. However, the estate trustees tried to contact the brother for the purpose of distributing the items, but the brother did not respond. The estate trustees then divided the personal property into lots and assigned a number to each lot. A number was drawn for each child, and the personal effects were distributed accordingly. The court held that this was a fair way of dealing with the personal effects in the circumstances.

At the end of the day, after payment for compensation and out-of-pocket expenses (but before any award of legal costs) the net estate for distribution would be about $47,000, or $15,000 to each beneficiary. Even with the summary procedure that was adopted, the trial took two days to hear. However, notwithstanding the size of the estate, it appears that the issues were important enough to the beneficiaries and estate trustees so as to warrant a judicial determination.

Unfortunately, whether a large estate or a small one, sometimes a determination by the court as to the rights of the parties or the propriety of the action of the estate trustees is necessary. Unfortunately, often the parties are not able to cooperate to ensure that the legal determination can be obtained as efficiently and cost-effectively as possible. The parties and their counsel, in this case, should be commended for their cooperation in having the diverse legal issues put before the court in an efficient manner.

Thank you for reading.

Paul Trudelle

02 Jul

Canada Day, 2021

Paul Emile Trudelle General Interest Tags: , 0 Comments

“July 1, not being a Sunday, is a legal holiday and shall be kept and observed as such throughout Canada under the name of ‘Canada Day’.

When July 1 is a Sunday, July 2 is a legal holiday and shall be kept and observed as such throughout Canada under the name of ‘Canada Day’.”

So mandates ss. 2(1) and (2) of the Holidays Act, R.S.C., 1985, c. H-5.

Canada Day became Canada Day on October 27, 1982. Prior to that, the day was said to be “Dominion Day”, which was officially recognized as a holiday in 1879 by way of The Dominion Day Act, 1879. Before that, the day did not have a name. However a proclamation was issued on June 20, 1868 whereby the Governor General proclaimed: “I do hereby enjoin and call upon all Her Majesty’s loving subjects throughout Canada to join in the due and proper celebration of the said Anniversary [of the forming of the Dominion of Canada] on the said FIRST day of JULY next.”

As Suzana Popovic-Montag observed in her blog of July 1, 2015, Canada Day, is a commemoration of the confederation of Upper Canada, Lower Canada, New Brunswick and Nova Scotia. Contrasted with the 4th of July celebrations to the south, “Canada Day is less of a celebration of our collective self-assertion to obtain our autonomy by force and more of a celebration of our ability to come together, our ability to work together and even our ability to live together – which is a really nice thing to celebrate.”

That is a wonderful sentiment. However, we still have a lot of work to do on improving our abilities to come together, work together and live together. The job is not done, and Canada faces many issues.

Take some time to celebrate Canada this weekend, and also take some time to contemplate the issues faced by many and the need for all of us to focus on how we can better work, live and come together.

Have a great weekend.

Paul Trudelle

25 Jun

Text Messages and Signatures

Paul Emile Trudelle General Interest, Litigation Tags: , , , , , , , , 0 Comments

Can a text message be tantamount to a signed acknowledgment?

Yes, according to the recent Ontario Divisional Court decision in 1475182 Ontario Inc. o/a Edges Contracting v. Ghotbi.

There, the court considered the application of certain provisions of the Limitations Act, 2002. Essentially, under the Act, a claim must be started within two years of the act or omission giving rise to the claim. However, under s. 13 of the Act, the date for a claim for payment can be extended where the debtor acknowledges the debt to a creditor IN WRITING and SIGNED BY THE PERSON MAKING IT OR THE PERSON’S AGENT.

In Edges, a contractor sued for money owing for renovation work. The last payment under the contract was made in March 2016. The claim was not commenced until May, 2018, and the defendant argued that the claim was statute-barred. However, the defendant texted the contractor in June, 2016, saying “The balance will be paid once everything is completed as per your agreement. No payment will be made until everything is clear. I’m going to hire a third-party inspector and their fees will be deducted from your payments too.”

The contractor argued that this was an acknowledgment of the debt, and therefore extended the limitation period. The defendant countered by arguing that the text was not signed, and therefore did not have that effect. The Small Claims Court judge and the Divisional Court disagreed.

On the issue of whether the text satisfied the statutory requirement that the acknowledgement be “signed”, the Divisional Court noted that there was no issue as to whether the text was authentic, or sent by the defendant. The Divisional Court held:

  1. The requirement of a signature is grounded in concerns of authenticity. As there was no issue with respect to the authenticity of the text, the underlying purpose of the signature requirement was satisfied.
  2. In any event, the Divisional Court concluded that the text was “signed”, albeit not in the traditional sense. The text was sent from the defendant’s cell phone. The phone had a unique phone number, and “other unique identifiers associated with … [the defendant’s] phone, including, without limitation, an International Mobile Equipment Identifier (IMEI) number. These unique identifiers provide, in effect, a digital signature on every message sent by the user of that particular device.”

The Divisional Court observed that “The world is changing. Everyone knows that. We live in a digital world now, much more than was the case when the Act came into force in 2002. It is incumbent upon the court to consider not just traditional means of affixing one’s signature to a document, but other, more modern means, including digital signatures.”

The world is indeed changing. Text with caution.

Have a great weekend.

Paul Trudelle

18 Jun

Regulating Funeral Service Providers

Paul Emile Trudelle Funerals Tags: , , , , 0 Comments

Funeral services providers are heavily regulated in Ontario. They must follow the provisions of the Funeral, Burial and Cremation Services Act (“the Act”). Under the Act, a service provider’s licence may not be renewed if “the past conduct of the applicant or of an interested person in respect of the applicant affords reasonable grounds for belief that the applicant will not carry on business in accordance with the law and with integrity and honesty”.

The Act is administered by the Bereavement Authority of Ontario. The Registrar of the Bereavement Authority of Ontario can make the decision of whether to revoke a licence or not. A licencee who disagrees with the Registrar’s decision can request a hearing before the Licence Appeal Tribunal (“the LAT”). LAT decisions can be appealed to the Divisional Court. In considering an appeal, the standard of review applied by the Divisional Court on a question of law is “correctness”, and on a question of fact or mixed fact and law, is on a “palpable and overriding error” standard.

Registrar, Funeral Burial, and Cremation Services Act v. Thomas was an appeal by the Registrar to the Divisional Court. The licencee’s funeral preplanner licence was revoked by the Registrar. The Registrar’s decision was reversed by the LAT. The Registrar appealed to the Divisional Court.

The Registrar alleged that the past conduct of the licencee in question demonstrated that she would not carry on business in accordance with the law and with integrity and honesty. On an agreed statement of facts, it was agreed that the licencee misappropriated funds from consumers in two separate instances. In one instance, the licencee suggested that in order to facilitate a transaction, the consumer transfer payments to the licencee’s personal account, which she would later transfer to her employer. Unfortunately, not all of the funds were transferred by the licencee to the employer. $1,000 was not transferred, apparently by inadvertence: the licencee claimed that she was not aware that she had received the transfer. In a second instance, the consumer preplanned his interment space and a monument. However, he could not make full payment, and died before full payment was made. $1,652 remained outstanding on his contract before he died. The licencee made the payment from the trust account of another family, and billed the deceased’s family after the deceased died. The payment made by the deceased’s family went, unbeknownst to them, to the account of the other family.

The LAT considered the fact that the licencee did not misappropriate funds for her own benefit, and there was, ultimately, no harm to her consumer clients. While the licencee’s actions may have been “deficient and could have been more professional”, the transactions did not lead to a concern that she would act without integrity and honesty. The LAT stated “Given this experience, I expect that [the licencee] has learned that she must do a better job separating her personal relationships with her clients from her professional role.”

The Divisional Court upheld the licence reinstatement decision made by the LAT. It found that the LAT properly focused its analysis on the nature and severity of the misconduct in determining whether it gave rise to reason to believe that the licencee cannot perform her functions in accordance with the law and with honesty and integrity. The LAT made no error of law, and no palpable and overriding error in the application of the test.

Although the licencee in that case was allowed to keep her licence, it is comforting to know that the actions of funeral professionals are closely scrutinized, and that those who will not follow the law or carry on business with integrity and honesty will not be allowed to carry on business.

Thank you for reading. Have a great weekend.

Paul Trudelle

11 Jun

No Junkets: Estate Trustee Expenses

Paul Emile Trudelle Executors and Trustees, Funerals Tags: , , 0 Comments

Disposing of the body is a fundamental responsibility of an estate trustee, and an estate trustee is entitled to be reimbursed from the estate for legitimate and reasonable funeral expenses. In considering what is “reasonable”, the court will consider the deceased’s “station in life”, and other circumstances, such as any direction from the deceased in the will or otherwise, the size of the estate, and cultural and religious beliefs, practices and traditions: see Chernichan v. Chernichan (Estate), a decision of the Queen’s Bench of Alberta.

In Zaradic Estate (Re), the Supreme Court of British Columbia disallowed an estate expense of $11,525.01 claimed by the two estate trustees for a trip to Croatia to deliver and scatter the deceased’s cremated remains. There was no specific provision in the will directing that the remains be taken to Croatia. However, the will did provide that the executors could incur expenses in relation to the deceased’s funeral. The executors also gave evidence, which was accepted by the court, that the deceased wanted his remains taken to Croatia. However, the court held that there was no justification for BOTH estate trustees to travel to Croatia. Therefore, only half of the cost of the trip was allowed.

(In Zaradic, the estate trustees, who were friends of the deceased, were also denied executor compensation. Although the will provided that they could claim compensation in the amount of 10% of the value of the estate, the court held that their actions disqualified them from receiving any compensation. The estate trustees had attempted to sell the deceased’s residence to their daughter at a price well below market value. The residual beneficiary commenced litigation in order to stop the proposed improvident sale. “The actions of the executors were an egregious breach of their fiduciary duty. If they had been successful, the beneficiary would have been swindled out of 50% of the estate’s value, and the executor’s (sic) daughter, their only child, would have thereby profited. … the actions of the executors are sufficiently egregious to disentitle them to any fee.”)

In The Estate of George Francis Perkins, the estate trustee claimed payment for airfare for his son and daughter-in-law (the deceased’s grandson and granddaughter-in-law) to travel to the deceased’s funeral. The court disallowed half of this expense, stating that it was unreasonable for the estate to pay for BOTH tickets, in light of the small size of the estate.

Where expenses are incurred for funeral and burial related matters, the beneficiaries of the estate will examine these closely, and the courts will likely disallow anywhere there is a hint of unreasonableness, or where it appears that the estate trustees were unfairly taking advantage of their position at the expense of the estate.

Have a great weekend.

Paul Trudelle

04 Jun

Dickens’ Provisions: Reversion of Literary Rights to an Author’s Estate

Paul Emile Trudelle Estate Litigation Tags: , , , , , , , 2 Comments

Estates of artists pose problems. Issues arise with respect to the ownership, use and disposal of the artist’s works.

An important consideration relating to copyright and estate assets is the concept of “Dickens provision” under Canada’s copyright laws.

Briefly put and simplified, the Copyright Act creates reversionary rights with respect to the heirs of an author. Notwithstanding any assignment agreement made during the lifetime of the author, the author’s copyright reverts to the author’s estate 25 years after the death of the author.

The provisions are technical, and there are important notice provisions that apply and must be followed before the reversion can occur. This was the issue in the 2002 decision of Anne of Green Gables Licensing Authority Inc. v. Avonlea Traditions Inc.

In Anne of Green Gables Licensing Authority Inc. v. Avonlea Traditions Inc., the court sets out the reasoning behind the provisions: “This complex statutory framework of reversionary copyright was originally created in England to relieve against the hardship suffered by the impoverished families of deceased authors”. The court goes on to note that the reversionary rights have been repealed in England, but remain in force in Canada.

The Dickens provisions were applied in the matter of Winkler v. Roy. There, Thomas Kelley, who authored several books on the Black Donnellys[1], died. The court determined that under the Dickens provisions of the Copyright Act, his estate was the owner of the copyright, notwithstanding the fact that Kelley assigned the rights during his lifetime. The assignee would own the copyright until a date 25 years from Kelley’s death, and thereafter, the copyright would belong to his estate.

Subsequently, the Kelley estate sued another author, Nate Hendley for copyright violations, alleging that Hendley copied Kelley’s story of the events relating to the Donnellys. The action was dismissed. The court held that Kelley presented his version of the story as being true historical facts. The rule that “there is no copyright in facts” applied, even if some of the facts as presented by Kelley were subsequently shown to be untrue and thus literary creations.

One takeaway from all of this is that estates of artists require special care and consideration. Expert advice is essential to their proper administration. A second takeaway is to avoid feuding with your neighbours.

Have a great weekend.

Paul Trudelle

 

[1] On February 4, 1890, after years of feuding, a mob of townsfolk attacked the Donnelly homestead, leaving five members of the Donnelly family dead and their farm burned to the ground. Despite two trials, no one was ever convicted of the murders.

A podcast on the event, written by Nate Hendley, can be found here.

28 May

The Cost of a Cemetery Plot in Toronto

Paul Emile Trudelle General Interest Tags: , , 0 Comments

We hear regularly about the high cost of real estate in Toronto. It appears that we will be taking this news to our grave.

The cost of a cemetery plot can be staggering. At Mount Pleasant Cemetery, operated by Mount Pleasant Group, and one of the few cemeteries that posts their prices online, the price of a grave ranges from $24,974 to $48,118, depending on location (location, location), and whether you want to install a flat marker memorial or an upright memorial. The cost of the marker is extra, as is the cost of other services, such an interment ($1,160 to $1,320), use of a tent, mats, late afternoon burials (an extra $165 if between 3:30 pm and 4 pm, or $205 if between 4 pm and 4:30 pm), reopening a grave to bury second remains ($5,080), and other administration fees.

Knob Hill Farms grocery store owner and businessman Steve Stavro is famously buried at Mount Pleasant Cemetery. Stavro, who died in 2006, is rumoured to have a grave marker that cost $800,000.

An indoor mausoleum space ranges from $18,970 to $32,455 at Prospect Cemetery, near St. Clair and Caledonia, which is also run by Mount Pleasant Group.

Like other real estate, the price is often lower outside of Toronto. Prices for a plot in Thornton Cemetery in Oshawa range from $2,389 to $3,540.

Of course, if price is an issue, other options exist. We have posted several blogs on green burials and other alternatives to a traditional burial, and the growing prevalence of cremation.

Stay safe.

Paul Trudelle

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