30 Apr

Cremain in Light: Dealing with Cremated Remains

Paul Emile Trudelle Litigation Tags: , , 0 Comments

“Whatever one’s beliefs might be surrounding death, it is likely safe to say that very few people would want their surviving children to be arguing in court about the placement of their ashes almost 5 years after their death. But there are strange things done in the name of ‘respect’.”

This opening paragraph from the decision of Krauch v. Degen Estate, 2021 NSSC 108 (CanLII) serves as the introduction to a consideration of an estate trustee’s rights and obligations with respect to the disposal of ashes, or cremated remains (or, as I only recently heard, and am still not comfortable with, “cremains”).

In Degen Estate, mother died in May 2011. She did not have a Will. Her remains were cremated and were placed in a niche purchased by mother and father. Father then died, leaving a will that appointed one of his six surviving children as estate trustee.

Issues arose with respect to the remains of mother and father following father’s death. In particular, mother’s remains, which were in the family niche, were moved to a “cremation bench” purchased by father. The cremation bench was 25 feet from the niche. Father’s remains remained in the niche. One child strongly objected to the separation of mother and father’s remains.

The objection took the form of an objection to the accounting prepared by the estate trustee of father’s estate. The court held that this was improper. “Disputes about how a person’s ashes are to be kept are not disputes that involve the passing of the accounts of the estate. [The objecting child’s] concerns about the internment of her parents’ ashes are not grounds for the court to refuse to pass the accounts.”

The court went on to consider the legal status of ashes. The court noted the difference between a body and ashes. With a body, once it is interred, there is a sense of finality. Bodies are generally not subject to being disinterred or moved elsewhere. Cremation, however, is different. “A person’s ashes may be divided among family members, placed in urns, moved from place to place, kept on a mantle, buried, scattered or used to create a ‘diamond’.”

The court referred to case law establishing the point that remains are not property of the estate. The estate trustee has possession of the remains and the obligation to dispose of the remains in a manner that is dignified and respectful. In doing so, the estate trustee has significant discretion.

“But the executor’s obligations are fulfilled when arrangements have been made for the appropriate disposition of the ashes. That may involve simply scattering them, having them buried or otherwise interred, or provided to family members, all at the discretion of the executor. An executor is not bound by a testator’s wishes to have ashes scattered in a particular place or places or retained or interred in a particular way. An executor should not be responsible for what family members or others do with the ashes that have been entrusted to them. And estates should not be required to respond to claims by family members for a share of the ashes or for a say in the final disposition of the ashes. That kind of litigation would be unseemly, wasteful and the very opposite of dignified.

As a final observation, the court noted that in any event, mother’s ashes were not part of father’s estate. In moving mother’s ashes, the son was not acting as estate trustee of father’s estate. The court stated that there was no legal impediment to the moving of the ashes by the funeral director from the niche to the cremation bench. However, the court does not say what authority the funeral director would have.

Read Ian Hull’s blog on the question of whether human remains are property of an estate, here.

Have a great weekend.

Paul Trudelle

29 Apr

Public Guardian  and Trustee to Investigate

James Jacuta Litigation Tags: , , , , 0 Comments

In the Estate of Oliver (Re Oliver Estate, 2021 ONSC 2751) decision on April 12, 2021, the applicant, who was treated as a stepdaughter by the deceased, had her motion seeking appointment as Estate Trustee dismissed. William Oliver died intestate on July 14, 2020, and had no spouse, children, parents, siblings, nieces or nephews survive him. The applicant was the daughter of the person with whom the deceased cohabited in a common-law relationship in the 1980s and she had remained close to him, even being appointed attorney for him on a TD bank account in 2017.

Justice Macleod found that the daughter of a partner with whom the deceased co-habited, does not fall within any class of person recognized as an heir on an intestacy pursuant to the Succession Law Reform Act, RSO 1990 and Letters of Administration could not be issued under the Act. It was possible to make an order appointing the applicant as administrator of the property of the deceased under s. 29 (3) of the Estates Act, RSO 1990.  Instead however, the court referred the matter to the Public Guardian and Trustee to investigate. Such investigative authority can be found in the Crown Administration of Estates Act, RSO 1990 where the “Public Guardian and Trustee is authorized to, (a) identify and locate,  (i) persons who may have an interest in the estate, and (ii) other persons, but only for the purpose of locating persons who may have an interest in the estate; and (b) identify the estate’s assets.”

The court can refer a matter to, but cannot order the Public Guardian and Trustee to be appointed as a result of the provisions of Public Guardian and Trustee Act RSO 1990, where, “The Public Guardian and Trustee shall not be appointed as a trustee, by a court or otherwise, without his or her consent in writing”. Given staffing issues and limited resources as well as pandemic restrictions it is perhaps not entirely moot to ask what happens to the estate if the Public Guardian and Trustee does not consent to be appointed Trustee in a case like this.

Thanks for reading.

James Jacuta

28 Apr

An Estate Trustee/Executor Role Comes With Some Liability

Ian Hull Estate Planning Tags: , , , , , , 0 Comments

If you are asked to be someone’s estate trustee/executor, you may wonder what liability you are assuming. That is on top of the regular workload, as settling the testator’s financial affairs and distributing the remaining assets to their beneficiaries usually takes a year, involving visits to banks, lawyers and other relevant parties. Much can happen in that time, and beneficiaries may be pressuring you to quickly pass along their share of the estate.

Here are some important points to keep in mind with personal liability.

Many Last Wills and Testaments contain phrasing meant to protect loved ones as they carry out their executor duties, usually along the lines of: “No trustee acting in good faith shall be held liable for any loss, except for loss caused by his or her own dishonesty, gross negligence or a wilful breach of trust.”

That type of clause is important, but there is still some liability that comes with the position.

First, let’s make it clear that an executor does not incur personal liability for the debts and liabilities of the deceased. However, it is the executor’s duty to ensure that financial obligations are paid from the estate before any money goes to beneficiaries.

The potential liability here is particularly significant with respect to taxes. Most estates will have taxes owing, so it is the executor’s duty to ensure that all outstanding tax matters are resolved. Section 159 of the Income Tax Act requires executors to obtain a clearance certificate. This document confirms that the taxes of the deceased have been paid in full. If the executor does not obtain this certificate and the funds from the estate have already been distributed, they will be personally liable for taxes owed.

There is always a chance that an executor could discover the testator was not meeting their tax obligations to the Canada Revenue Agency (CRA). There are a number of reasons this may arise, ranging from simple carelessness to deliberate tax evasion. No matter the situation, the executor is responsible for rectifying that shortcoming using the estate’s funds, before money is given out to beneficiaries.

The CRA has created a Voluntary Disclosure Program that allows executors to come forward and voluntarily correct any errors or omissions without being subject to penalties or prosecution.

Personal liability for executors also arises if they spend money on professionals to help with the administration of the estate. That could include such people as lawyers, accountants, investment advisors, real estate agents, or art appraisers. Estates can be complex, so it is well within the scope of diligent executors to seek professional guidance. Accordingly, the cost for these services will be borne by the estate, not by the executor.

Detailed records must be kept of any money spent, as executors have a duty to account to the beneficiaries. These records must show all expenses paid by the estate and what money the estate received, from insurance benefits, banks or other sources.

In most cases, beneficiaries of an estate will approve, or consent to, the accounts as kept by the estate trustee. But if they feel finances were not properly managed, they can ask for court approval of the records, known as a “passing of accounts.”

Since executors have a duty to maximize the recovery, and value, of estate assets, they are personally liable for any losses they cause. That could include being reckless with the assets, which causes a loss in monetary value. Examples of this would be if an estate has to pay penalties on a tax return that the executor filed extremely late for no good reason, or if a home was sold for much less than market value.

The good news is that if an executor performs their duty diligently and honestly, any financial liability they assume will be paid by the estate.

Be safe, and have a great day.

Ian Hull

27 Apr

Starting an Application on “Nothing to Do with Procedural Matters”

James Jacuta Litigation Tags: , 0 Comments

In the world of wills and estates law,  matters are often commenced by way of an Application. Justice Marc Smith released a decision on March 21, 2021, in Larmon v Munro, 2021 ONSC 1921 that deals with a number of matters and also decides whether the Motion for Directions was appropriate for the relief being sought in that case. The purpose of a Motion for Directions under r. 75.06 of the Rules is procedural in nature.  Rule 75.06(3)  sets out the type of orders for directions that can be given by the Court. Some of the proper matters in an order for directions include; issues to be decided, who are the parties, who shall be served, the appointment of an estate trustee during litigation, security for costs, and such other procedures as are just.

In this case, the motion sought a declaration for, a sum owing from the estate, with regard to debts being satisfied, for delivery of hunting equipment and tools, as well as an order in regard to vehicle ownership and sale of a house.

Justice Smith found that the relief sought had “… nothing to do with procedural matters. Rather, it pertains to the payment of expenses, fulfillment of duties and delivery of assets. In my opinion, r. 75.06 of the Rules was not intended to be used to secure these types of declarations and orders.”

For the reasons outlined above, the Motion was dismissed.

For more on this topic please see Stuart Clarks’s blog entitled “Procedural Differences Between Applications and Actions”.

Thanks for Reading.

James Jacuta

26 Apr

A Word About “Chernobyl” Excess in Litigation

James Jacuta Litigation Tags: , 0 Comments

It was 35 years ago today that the Chernobyl nuclear disaster occurred and since then “Chernobyl” has become a metaphor for catastrophic disaster. Similar consequences can also result after family battles involving divorce proceedings or inheritance. Some useful considerations for lawyers involved in acrimonious litigation are found in Alsawwah v. Afifi, 2020 ONSC 2883. The comments of Justice Kurz have been edited below for brevity:

“Having been required by the exigencies of this motion to closely and frequently review the materials filed in this motion, I feel constrained to offer a few words of caution to the parties, their counsel and to the profession as a whole.”

“Litigants feel that they can leave no pejorative stone of personal attack untilled when it comes to their once loved one. Many lawyers, feeling dutybound to fearlessly advocate for their clients, end up abetting them in raising their discord to Chernobyl levels of conflict.”

“In the hopes of lowering the rhetorical temperature of the future materials of these parties and perhaps those of others who will come before the court, I repeat these essential facts, often stated by my colleagues at all levels of court, but which bear constant repetition:

  • Evidence regarding ….moral failings is rarely relevant to the issues before the court.
  • Nor are we swayed by rhetoric against the other party that verges on agitprop.
  • Exaggeration is the enemy of credibility.
  • Affidavits that read as argument rather than a recitation of facts are not persuasive.
  • Hearsay allegations ….are generally ignored, whether judges feel it necessary to explicitly say so or not.
  • A lawyer’s letter, whatever it says, unless it contains an admission, is not evidence of anything except the fact that it was sent.
  • Facts win cases. A pebble of proof is worth a mountain of innuendo or bald allegation.
  • One key to success in family law as in other areas of law is the race to the moral high ground. Courts appreciate those parties and counsel who demonstrate their commitment to that high ground in both the framing and presentation of their case.”

Justice Kurz offers a great deal of useful advice which reaffirms that the use of “Chernobyl” excess in litigation should be avoided at all times.

Thanks for reading!

James Jacuta

23 Apr

Long-Term Care COVID-19 Commission Report

Hull & Hull LLP Uncategorized Tags: , , , 0 Comments
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In July 2020, the provincial government announced a Commission into COVID-19 and long-term care. The Commission was mandated to investigate how the pandemic spread within the homes, how residents, staff and families were impacted, and the adequacy of measures taken by the province and other parties. With the expected release of the Commission’s final report on April 30, 2021, the province will now review the report and begin to consider changes.

Come join Hull & Hull LLP’s Natalia Angelini and Wahl Elder Law’s Judith Wahl as they co-chair the upcoming OBA program: Long-Term Care COVID-19 Commission Report, on Tuesday, May 11th from 12:00 pm to 1:30 pm.

The Chair of the Long-Term Care COVID-19 Commission, The Hon. Associate Chief Justice Frank N. Marrocco, will be sharing his insights. This will be followed by a panel discussion on the key legal issues that arose and are continuing to arise in Long-Term Care settings across the province.

This program is eligible for up to 1 hour and 30 minutes of substantive CPD hours.

Registration via the Ontario Bar Association can be found here.

 

23 Apr

Expect Delays: Court Calls for Deferral of Most Matters (Except on Toronto’s Estates List)

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

In a Notice to the Profession and the Public updated April 20, 2021, Chief Justice Morawetz of the Ontario Superior Court gave notice that until May 7, 2021, the Court will be deferring as many matters as possible. This restriction is in light of the recent critical situation as a result of the COVID-19 pandemic, and in light of the recent heightened province-wide Stay-at Home order effective April 17, 2021.

The Notice reads as follows:

In view of the strengthened stay-at-home order and the critical situation with the pandemic, over the next several weeks until May 7, to reduce the number of court staff, counsel or parties required to leave their homes to participate in court proceedings, the Court will defer as many matters as possible. This includes virtual hearings.

The Court will focus on hearing

  • the most serious child protection matters
  • urgent family matters
  • critical criminal matters, and
  • urgent commercial or economic matters where there are employment or economic impacts.

Subject to the discretion of the trial judge, matters that are in-progress can continue. The positions of the parties and staff should be strongly considered and alternate arrangements should be made for those who do not wish to attend in-person.

The Court is seeking the cooperation of counsel to defer as much as possible.

However, matters WILL be proceeding as scheduled on the Toronto Estates List. In a message sent out by Justice McEwen, he stated that unless you are advised to the contrary, you should assume that any matters currently scheduled on the Commercial List or Estates List are proceeding as scheduled. This is because all matters on the Lists are proceeding virtually, and most are proceeding without the need for court staff to be physically present in the Court. The message was distributed to members of the Estates List Users Committee for dissemination. If you would like to receive a copy, please contact me at ptrudelle@hullandhull.com.

Have a great weekend.

Paul Trudelle

22 Apr

What is the Purpose of Section 3 Counsel Under the Substitute Decisions Act, 1992?

Rebecca Rauws Capacity Tags: , , , , , , , , , , 0 Comments

Pursuant to section 3 of the Substitute Decisions Act, 1992 (the “SDA”), if there is a proceeding under the SDA where a person’s capacity is in issue, but they do not have legal representation, the court may direct that the Public Guardian and Trustee (the “PGT”) arrange for legal representation for the person. The person will be deemed to have capacity to instruct counsel. This legal representation is often referred to as “section 3 counsel”.

We have previously blogged about the role of section 3 counsel (for instance, here and here). Section 3 counsel has been described as a safeguard that protects the dignity, privacy, and legal rights of a person who is alleged to be incapable.

Section 3 counsel plays a very important role in proceedings dealing with a person’s capacity, as they allow the person whose capacity, and possibly their rights and liberties, are at issue, to have a voice before the court.

In Singh v Tolton, 2021 ONSC 2528, there was a proceeding relating to the validity of powers of attorney executed by Rajinder Kaur Singh. The PGT proposed that the court consider appointing section 3 counsel for Rajinder. One of Rajinder’s children also requested that section 3 counsel be appointed. One of her other children, Anney, took the position that section 3 counsel was not necessary and raised a concern with the expense of appointing counsel, which cost would be borne by Rajinder.

The court concluded that this was an appropriate situation for the appointment of section 3 counsel. In coming to this conclusion, the court considered the purpose of the SDA, which is to protect the vulnerable. As noted by Justice Strathy, as he then was, in Abrams v Abrams, [2008] O.J. No. 5207, proceedings under the SDA do not seek to balance the interests of the litigants, “but the interests of the person alleged to be incapable as against the interest and duty of the state to protect the vulnerable.” Section 3 is just one of the provisions of the SDA that demonstrate the care that must be taken to protect the dignity, privacy, and legal rights of the individual.

The court in Singh v Tolton also noted that the material before it disclosed a family at odds regarding Rajinder’s personal care. In a situation such as this, there may be a concern that the wishes or best interests of the person whose capacity is in issue will be lost amidst the fighting family members. Section 3 counsel can serve a crucial function in these types of circumstances, by sharing the person’s wishes and instructions with the court.

Thanks for reading,

Rebecca Rauws

 

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21 Apr

If You Die Without a Will, Here is What Happens

Suzana Popovic-Montag Estate Planning, Wills Tags: , , , 0 Comments

The great thing about having a Last Will and Testament is that it clearly spells out what happens to your estate upon your passing. Conversely, the terrible thing about not having this document in place when you die is that you have no control over how your assets are distributed, which may cause anguish and hardship to loved ones you would have otherwise chosen as beneficiaries.

When you die without a will, or intestate, Ontario’s Succession Law Reform Act (the “SLRA”) sets out how your estate is distributed. It provides that unless someone who is financially dependent on the deceased person makes a claim, the first $350,000 is given to the deceased person’s spouse.

A problem that immediately arises is defining the meaning of spouse. For the purposes of intestacy, the SLRA adopts the definition of spouse found in section 1 of the Family Law Act, which reads: “‘spouse means either of two persons who: (a) are married to each other, or (b) have together entered into a marriage that is voidable or void, in good faith on the part of a person relying on this clause to assert any right.

As such, only married spouses are entitled to benefit under the intestacy regime. You may have had a long and loving common-law relationship with a person you regarded as a spouse, but if there is no formal wedding declaration, they could be denied the inheritance you wanted them to receive. A common-law spouse may potentially seek redress by making a dependant’s support claim against your estate, though it is an effort and expense that could have been avoided with a proper will.

If you have no spouse, your children will inherit the estate. Sounds simple enough, but again there may be an issue with the way in which the SLRA defines child, as it only accepts biological offspring or those who were adopted as children. With blended families, many people have developed loving and long-lasting relationships with their step-children. In the eyes of the SLRA, however, they are not given the same inheritance rights as biological and adopted children.

Things get a bit complicated from here. Allow me to summarize:

  • If any children have died, that child’s children will inherit their share.
  • If there is no spouse or children or grandchildren, the deceased person’s parents inherit the estate equally.
  • If there are no surviving parents, the deceased person’s brothers and sisters inherit the estate.
  • If any of the brothers and sisters have died, their children (the deceased person’s nieces and nephews) inherit their share.
  • If there are no surviving brothers and sisters, the deceased person’s nieces and nephews inherit the estate equally. (If a niece or nephew has died, their share does not pass to their children.)
  • When only more distant relatives survive (cousins, great-nieces or nephews, great aunts and uncles), the rules are complex and a lawyer’s advice is a good idea.

There are many other problems that arise with those who die intestate, such as deciding who will be executor and oversee the estate distribution. The closest relative is usually chosen by the courts for the position, which may mean that your children are in charge and not your common-law spouse, which could create tension and expensive legal battles.

If you have minor-age children and there is no other legal parent alive, the appointment of the guardian will be out of your control.

Perhaps you have promised your grandson that he will inherit your valued coin collection when you die. That probably won’t happen, since all assets of the estate will be valued and divided up under the SLRA rules. However, in a will you can leave specific instructions, directing who receives what items you are leaving behind.

You may feel indebted to a charity, church, or hospital for their work while you were alive, and you want to leave that institution some money. Again, that can’t happen without a will.

The final point to consider is that if you have no next-of-kin and you die without a will, your entire estate goes to the Ontario government, with the Office of the Public Guardian & Trustee stepping in to administer your estate and seize your assets.

Drawing up a Last Will and Testament is a simple way to avoid all these issues, saving anguish and needless paperwork when the time comes.

Thanks for reading, and have a great day!

Suzana Popovic-Montag

20 Apr

Hull on Estates #611 – Production Orders and Drafting Solicitor’s Files

76admin Hull on Estate and Succession Planning, Hull on Estate and Succession Planning, Hull on Estates, Podcasts, Wills Tags: , , , , , 0 Comments

This week on Hull on Estates, Stuart Clark and Kira Domratchev discuss the recent decision of Grove v Simon Dirk Kenworthy-Groen as executor of the estate of William Grove [2021] WASC 70, pertaining to production of preceding Wills and a drafting solicitor’s records.

Should you have any questions, please email us at webmaster@hullandhull.com or leave a comment on our blog.

Click here for more information on Stuart Clark

Click here for more information on Kira Domratchev

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