Category: Common Law Spouses
The city of Toronto was abuzz this past weekend as we kicked off summer 2019 with wall-to-wall sunshine. There were so many wonderful things to celebrate this weekend. For some, celebrations continued over the Toronto Raptor’s historic NBA Championship win. Some were tapping their feet to the beat for the first weekend of Toronto’s Jazz festival. Others, like myself, were flooding the streets to celebrate one of the city’s largest, loudest, and most colourful parades of the year – the Toronto Pride Parade.
Pride festivities provide a great opportunity to come together with others to celebrate and promote the equal rights of all persons regardless of gender or sexual orientation. While there, I reflected on some key considerations for LGBTQ+ individuals to consider in the context of estate planning in Ontario.
1. The value of a will
A will is an invaluable tool to assist people in planning for the future. The Succession Law Reform Act, RSO 1990, c. 26 (“SLRA”) gives individuals the power to dispose of property post-death.
Provided that your will meets the statutory requirements to be valid (which are prescribed in Part I of the SLRA) testators are free to dispose of their property as they wish. This a right regardless of sexual orientation or gender and includes couples that are in common-law relationships and same-sex marriages.
Importantly, the will provides a testator with a level of control over how children are provided for post-death. This is especially important in scenarios where parents rely on assisted reproduction as a method of conceiving a child. Having a will allows a testator to specifically name children and outline how that child is to take under the will. For more information about this, click here.
2. Rules of Intestacy
If you die without leaving a will, your estate will be subject to the rules of intestacy which are governed by Part II of the SLRA. Under these rules, married couples are entitled to take their spouses property absolutely if the deceased is not survived by issue. On July 20, 2005 the Parliament of Canada enacted the Civil Marriage Act, which legalizes same-sex marriage and provides in section 2, that, “Marriage, for civil purposes, is the lawful union of two persons to the exclusion of all others”. This definition replaced the former definition which described marriage as the lawful union between a man and a woman. As a result, same-sex spouses are entitled to take from their spouses estate on an intestacy.
In contrast, common-law relationships do not share this privilege, regardless of whether it is a heterosexual or homosexual common-law relationship.
3. Incapacity During Lifetime
An important consideration for LGBTQ+ individuals is also what would happen in the event that they become incapable of making decisions regarding their health care and property. Although laws vary by jurisdiction, legal and biological family, such as spouses (sometimes including common-law partners), children and parents, will generally be favoured over other persons who may have a close but legally unrecognized, relationship with the incapable person. This could have a negative impact on an individual whose non-accepting family members step into a decision-making role for them.
4. Dependant Support Claim
If you fall under the definition of a “dependant” under Part V of the SLRA, which could apply to same-sex common-law relationships and spouses alike, you may be entitled to make a dependant’s support claim against your partner’s estate.
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In my previous blog on the benefits of estate planning for millennials, I canvassed some of the ways in which today’s young adult generation differs from the young adults of generations past. One such difference is the increased prevalence of common law relationships in today’s millennial cohort. In a wide-ranging public opinion poll conducted in 2018 by the Angus Reid Institute, 53% of Canadian adults expressed feeling that marriage is “simply not necessary.” This attitude is reflected in rising rates of common law marriage in Canada: as Global News reports, while only 6.3% of Canadians were in common law relationships in 1981, this figure jumped to 21.1% by 2016.
While common law couples may feel no emotional difference from any formally married couple, there are significant differences between some of the legal rights that common law and married couples enjoy. In the estates context in Ontario, for example, common law spouses are treated differently than married spouses when one spouse dies without a Last Will – also known as dying “intestate”. This blog summarizes the relevant law and difference in treatment, below.
Common Law Spouses Have No Entitlement on Intestacy
In Ontario, Part II of the Succession Law Reform Act RSO 1990, c S 26 (the “SLRA”) governs how one’s assets will be divided if a person dies intestate.
Pursuant to sections 44 and 45 of the SLRA, when a person dies intestate and leaves behind a surviving spouse and no children (or “issue”), the surviving spouse will be entitled to the entirety of the deceased’s estate.
If the deceased leaves behind a surviving spouse and any children, the surviving spouse will get the first $200,000.00 of the estate (being the current SLRA “preferential share” value). If there is one child, the remainder of any residue is divided equally between the surviving spouse and child. If there is more than one child, the spouse will receive a third of the balance of any residue, while the remaining children will share the other two-thirds equally.
If the estate’s net value after debts, funeral and administration expenses is less than the present SLRA’s “preferential share” value, the surviving spouse is wholly entitled to the deceased spouse’s estate, irrespective of whether there are any surviving children.
Notably, however, the definition of “spouse” in this section does not encompass couples who are not formally married. For the purposes of intestacy, the SLRA adopts the definition of spouse found in section 1 of the Family Law Act, RSO 1990, c F 3, 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. (“conjoint”)
As such, only married spouses are entitled to benefit under the intestacy regime. While a common law spouse may potentially seek redress by making a dependant’s support claim against their deceased spouse’s estate, for example, they are not entitled to a share of their deceased partner’s estate pursuant to the laws of intestacy.
Given the above, it is all the more important for common law spouses to turn their minds toward formulating an estate plan wherein they provide for their partner accordingly.
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The Globe and Mail recently published an article on couples that live apart from each other. This particular article focuses on the story of a couple who has never shared a home in the course of their twenty-year relationship. This couple is not alone; approximately 1.9 million unmarried adults in Canada were in an intimate relationship with someone who occupies a separate residence in 2011.
This form of intimate relationships are considered to be a historically new family form. Sociologists have coined this phenomenon as “LAT couples“, i.e. couples that are living apart together.
While the article focuses on couples who are deliberately choosing to live apart, there are also external factors that may prevent a couple from living together (such as immigration or capacity issues where one spouse has greater care needs than the other spouse).
LAT couples raise an interesting question with respect to whether such couples would be considered as a “spouse” within the meaning of Part V of the Succession Law Reform Act for the purposes of dependant’s support. Pursuant to section 57 of the SLRA, the word “spouse” has the same meaning as section 29 of the Family Law Act.
Section 29 of the Family Law Act in turn defines the term spouse as,
- people who are married to each other;
- unmarried people who have cohabited continuously for a period of not less than three years; or
- unmarried people who are in a relationship of permanence if they have children.
Interestingly, the Ontario Court of Appeal has made the following comment in Stephen v. Stawecki, 2006 CanLii 20225:
“the specific arrangements made for shelter are properly treated as only one of several factors in assessing whether or not the parties are cohabiting”.
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In Michael v. Thomas, 2018 ONSC 3125, Justice Ramsay awarded a dependant support claimant the entirety of the Estate net of all debts and liabilities. The dependant support claimant in this case was a common law spouse of approximately 20 years. Ms. Michael was in her late-fifties/early sixties when Mr. Chambers died suddenly from cancer without a will.
Mr. Chambers and Ms. Michael were not married at the time of Mr. Chambers’ death. Accordingly, Ms. Michael was not a beneficiary of Mr. Chambers’ Estate pursuant to the rules of intestacy. Mr. Chambers did not have any children either so the beneficiaries of his Estate were his surviving siblings and two nephews who were the sons of his predeceased sister.
Justice Ramsay found that Mr. Chambers and Ms. Michael lived modestly during Mr. Chambers’ life. They were joint owners of their home, which Ms. Michael received by right of survivorship. The home was subject to a mortgage of about half its market value in the amount of $150,000.00. Ms. Michael was also the beneficiary of a modest $80,000.00 life insurance policy and her income became supplemented by an additional $3,325 per month through the deceased’s CPP and pension benefits. Ms. Michael worked part-time and has two adult children of her own. Interestingly, Justice Ramsay commented that Ms. Michael should not have to seek support from her adult children under the Family Law Act (even though she could, theoretically) before seeking support from Mr. Chambers’ Estate.
In considering the Respondent’s case, Justice Ramsay found that Mr. Chambers did not have any other dependants and that he was estranged from the only party who responded to Ms. Michael’s claims in Court. Mr. Chambers’ sister argued that Ms. Michael already received $203,965 out of the assets of the Estate, which, including section 72 assets, were worth a total $285,000. She further argued that Ms. Michael would be able to maintain the same standard of living that she used to enjoy if Ms. Michael supplements the pension income by working full-time at minimum wage. In his analysis, Justice Ramsay squarely stated as follows:
 I do not agree. It is not reasonable to expect the Applicant to take an entry level job at the age of 62 when she is already past the point of being able to sustain full time physical labour, even light physical labour. Even if it were possible, it would only raise her earnings to the low $40,000 range, which would still not be enough to continue the modest standard to which she was accustomed. I do not think that the intestate made adequate provision for the proper support of the Applicant.
 The estate is not big enough to make periodic payments. In fact it is not big enough to provide the proper support the Applicant needs. I think that a judicious spouse would have left her the entire estate, such as it is. The Applicant is the only dependant and the only person with any moral claim on the estate. Accordingly I order the trustee to convey to the Applicant the entire residue of the estate after payment of taxes, debts of the estate and his own fees and I declare that the amounts already received or already in the Applicant’s possession are hers to keep.
Ms. Michael was also awarded partial indemnity costs from Mr. Chambers’ sister. Mr. Chambers’ sister was found to have no need for “more found money” from Mr. Chambers’ Estate because of the inheritance that she received from their mother, and that costs from the Estate would have the same effect as awarding costs against Ms. Michael.
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In the recent decision in Seguin v Pearson, 2018 ONCA 355, the Ontario Court of Appeal reiterated the different tests for undue influence that apply in the inter vivos and the testamentary context.
The Issue on Appeal
In Seguin, the Deceased made a Last Will and Testament that made specific bequests to his daughters and left the residue of his Estate to his common law spouse. Prior to his death, the Deceased also transferred his house into joint tenancy with his spouse.
The Appellant, one of the Deceased’s daughters, appealed from a lower court decision dismissing her action challenging the validity of the Deceased’s Will and the inter vivos transfer of the home into joint tenancy.
On appeal, the Appellant’s principal argument was that the relationship between the Deceased and his spouse gave rise to a presumption of undue influence, and that the spouse had failed to rebut the presumption.
The Tests for Testamentary Versus Inter Vivos Undue Influence
After canvassing the evidence that had been tendered at trial by the plaintiff and the defendant, the trial judge looked to the Supreme Court of Canada’s decision in Goodman Estate v Geffen and the Privy Council’s decision in Craig v Lamoureux for the factors to be considered when assessing an allegation of undue influence. In Goodman, the Supreme Court discussed what must be established in order to trigger a presumption of undue influence.
However, on appeal, the Court of Appeal held that the Appellant had mischaracterized the test for undue influence in the testamentary context. Further, the Court of Appeal concluded that the trial judge had erred in articulating the test that is applicable to testamentary gifts.
At paragraphs 10 and 11 of its judgment, the Court of Appeal stated as follows:
“…The rebuttable presumption of undue influence arises only in the context of inter vivos transactions that take place during the grantor’s lifetime. It arises from particular relationships when the validity of inter vivos dispositions or transactions is in issue; once the presumption is established, the onus shifts to the transferee to rebut the presumption: Banton v. Banton (1998), 164 D.L.R. (4th) 176 (Ont. Gen. Div.) , at p. 209. … In the case of wills, it is testamentary undue influence, amounting to outright and overpowering coercion of the testator, which must be considered. The party attacking the will bears the onus of proving undue influence on a balance of probabilities: Vout v. Hay,  2 S.C.R. 876 (S.C.C.) , at p. 887; see also Neuberger Estate v. York, 2016 ONCA 191, 129 O.R. (3d) 721 (Ont. C.A.), at paras. 77-78.”
Although the trial judge had erred in stating the applicable test in relation to the challenge to the validity of the Deceased’s Will, the Court of Appeal held that this did not affect the reasonableness of his conclusion that the Deceased’s spouse had not unduly influenced the Deceased.
Given that the trial judge imposed the more onerous inter vivos standard of requiring the Deceased’s spouse to rebut a presumption of undue influence, the Court of Appeal concluded that the trial judge’s finding “would necessarily be the same had the trial judge applied the correct standard applicable to testamentary dispositions.”
After addressing the Appellant’s additional submissions, including her request for leave to appeal the trial judge’s determination on the issue of costs, the appeal was dismissed.
Thank you for reading,
Umair Abdul Qadir
The interplay between evolving social norms and the legal foundations that predate or accelerate these changes has seen significant development in the last decade. Courts of law and of public opinion have made important strides in shaping social policy in many areas, such as medically-assisted death, gender diversity and inclusion, and marriage rights, to name a few. A recent case out of the Ontario Superior Court of Justice considered this last issue, marriage rights, with a particular focus on predatory marriages.
In Hunt v Worrod, 2017 ONSC 7397, the Court was tasked with assessing whether an individual who had suffered a catastrophic brain injury possessed the necessary capacity to marry. In 2011, Kevin Hunt suffered a serious head injury following an ATV accident and spent four months recuperating in hospital. He was eventually discharged into the care of his two sons, but three days after his release, Mr. Hunt was whisked away by his on-and-off girlfriend, Kathleen Worrod, to be ostensibly married at a secret wedding ceremony.
Mr. Hunt’s children brought an application to the Court on his behalf to void the marriage, partly to preclude Ms. Worrod from accruing spousal rights to share in Mr. Hunt’s property or assets. Ultimately, the Court concluded that Mr. Hunt did not possess the requisite capacity to enter into the marriage.
In its reasons, the Court relied heavily on the opinions of several expert witnesses and the existing body of legal authority. The Court began by reviewing section 7 of Ontario’s Marriage Act, which provides that an officiant shall not “solemnize the marriage” of any person that the officiant has reasonable grounds to believe “lacks mental capacity to marry.”
The expert evidence tendered by the parties suggested that Mr. Hunt had significant impairments in his ability to make decisions, to engage in routine problem-solving, and to organize and carry out simple tasks. He was characterized as “significantly cognitively impaired”, and was assessed as being incapable of managing his property, personal care, or safety and well-being.
The Court subsequently relied on the test for capacity to enter into a marriage contract established by the British Columbia Supreme Court in Ross-Scott v Potvin in 2014. The Court held that a person has the capacity to enter into a marriage contract only if that person has the capacity to understand the duties and obligations created by marriage and the nature of the commitment more generally.
The Court also identified the tension between balancing Mr. Hunt’s autonomy as against the possibility that he lacked the capacity to appreciate the legal and social consequences of marriage. Ultimately, the Court was satisfied that Mr. Hunt’s children had met their burden of demonstrating that their father lacked the necessary capacity to marry Ms. Worrod. The marriage was declared void ab initio, and the attendant spousal property rights that would have otherwise flowed to Ms. Worrod were lost.
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Considering an application for partition or sale of real property that was bequested to you? Then consider the effect of s. 3(2) of the Partitions Act, R.S.O 1990, Chapter P.4.
The Partitions Act allows a joint tenant or tenant in common to bring an application or an action for the partition or sale of the land. However, s. 3(2) of the Act contains a prohibition on when such a proceeding can be commenced. In particular, where the land is held in joint tenancy or tenancy in common by reason of a devise or an intestacy, no proceeding shall be taken until one year after the decease of the testator or person dying intestate in whom the land was vested.
In Clayton v. Clayton, 2018 ONSC 1612 (CanLII), the court dismissed a motion for “partition and sale” of a property by the estate trustee of a joint holder of a property because it was brought before the expiration of one year after the death of the deceased applicant. As such, it was held to be a nullity.
The court dismissed the application for partition or sale without any reasons, other than a reference to s. 3(2) of the Partitions Act. It is not entirely clear, however, that the section applies, as the application was not brought by the beneficiaries of the estate, but rather, by the estate trustee of the estate. It is not entirely clear that the land was held in joint tenancy or tenancy in common “by reason of a devise or an intestacy”. It appears that the tenancy was between a husband and wife. The sole beneficiaries of the wife’s estate were her two children, who were not parties to the proceeding.
Clayton dealt with two other issues, as well. One issue was dismissed, and one was abandoned.
On the question of costs, the court held that as the respondent was entirely successful, he was prima facie entitled to costs. However, as there was no evidence that the applicant estate trustee was acting in breach of her duties to the estate or the beneficiaries, the court declined to make a costs award against the applicant personally. Further, as a costs award against the estate would ultimately come out of the pockets of the beneficiaries, the court declined to make a costs award against the estate. No order as to costs was made.
Keep s. 3(2) of the Partition Act in mind when considering any proceeding for partition or sale involving estate property.
Have a great weekend.
This week on Hull on Estates, Ian M. Hull and Stuart Clark discuss the recent case of Stajduhar v. Wolfe, 2017 ONSC 4954, and whether two individuals need to live together to be considered spouses within the confines of Part V of the Succession Law Reform Act.
Should you have any questions, please email us at firstname.lastname@example.org or leave a comment on our blog.
Litigation surrounding the estate of a deceased person can be protracted and emotional for the parties involved. Unfortunately, given the high costs of litigation, it can also be incredibly costly and onerous for the parties to litigate their dispute all the way to a trial.
Rule 20 of the Rules of Civil Procedure offers one procedural mechanism by which a party can bring an expeditious end to a litigation matter. Pursuant to Rule 20.04, the Court shall grant summary judgment where it is satisfied that there is no genuine issue requiring a trial with respect to a claim or defence, or the parties have agreed to have all or part of the claim determined by a summary judgment and the Court is satisfied that it is appropriate to grant same.
Rule 20 was amended in 2010 in order to improve access to justice, providing the Court with broader evidentiary powers on a motion for summary judgment. However, as demonstrated by a recent decision, the Court may still conclude that it is not appropriate to grant summary judgment in view of the litigation as a whole.
The Facts in Bazinet v CompuCom Canada Co., e al.
In Bazinet v CompuCom Canada Co., et al., 2017 ONSC 5194, Robert (the “Deceased”) died without a Will. There was a dispute over life insurance proceeds that were available to the Deceased as part of an employee benefits package. The parties had not produced a designation form naming a beneficiary to the insurance proceeds.
The plaintiff, the Deceased’s common-law spouse, claimed that she was entitled to the life insurance proceeds. She asserted that she had witnessed the Deceased signing a beneficiary designation in her favour, and that the Deceased had confirmed that she was the beneficiary of the policy after their separation. The plaintiff’s claim sought declaratory relief against all of the defendants, punitive damages and general damages against the Deceased’s employer CompuCom Canada Co. (“CompuCom”).
The Deceased’s Estate Trustees denied the plaintiff’s claims and advanced a counterclaim on behalf of the Estate, seeking a declaration that there was no designated beneficiary and that the proceeds were thus payable to the Estate. As the plaintiff was the Deceased’s common-law spouse, she was not entitled to a share of the Deceased’s Estate on an intestacy.
The Estate Trustees moved for summary judgment, seeking an order dismissing the plaintiff’s claims against the Estate and granting the declaratory relief sought on their counterclaim. The plaintiff, in turn, requested that partial summary judgment be granted in her favour.
Justice Corthorn’s Decision
In response to the motion for summary judgment, CompuCom argued that the matter was not an appropriate case for summary judgment in the context of the litigation as a whole. CompuCom asserted that findings of credibility were necessary for the determination of the issues, that summary judgment would not be dispositive of the entire proceeding and that a trial was required for the fair and efficient determination of all of the issues.
Justice Corthorn agreed with CompuCom’s position, concluding that summary judgment would not dispose of the entire action, including the plaintiff’s claim for monetary damages. Justice Corthorn also held that there was a risk of duplicative proceedings and inconsistent findings.
Given the nature of the plaintiff’s claims, Justice Corthorn held that a majority of the claims would remain to be determined at trial even if summary judgment was granted in the Estate Trustees’ or the plaintiff’s favour. Justice Corthorn also noted that she was not confident that it would be possible to assess credibility and reliability without the benefit of a trial, with the risk that the trial judge would make different findings of credibility and fact or reach inconsistent conclusions upon hearing the oral evidence of the affiants.
Accordingly, the motion for summary judgment was dismissed. The Court also refused to grant the relief that the plaintiff was seeking in response to the motion.
Proceeding With Caution
Justice Corthorn’s recent decision reiterates the importance of carefully considering whether a motion for summary judgment is appropriate before proceeding. If unsuccessful, the parties incur the cost of an interim motion in addition to the costs of a trial.
In addition, motions for summary judgment can have significant cost consequences. Rule 20.06 of the Rules of Civil Procedure provides the Court with the ability to order payment of costs of motion for summary judgment on a substantial indemnity basis if a party acted unreasonably by making or responding to the motion or acted in bad faith for the purpose of delay.
Thank you for reading,
Umair Abdul Qadir
“Can a romantic partner – even one in an apparently close and loving relationship for several years – make a claim for dependant relief without establishing that she actually lived together with the deceased for at least three years?”
This was the question raised in the recent decision of Stajduhar v. Kerzner Estate, 2017 ONSC 4954.
Spoiler alert: the answer is no.
As reported in the decision, the deceased died on December 31, 2016. The deceased died leaving a Will made three years after the relationship was alleged to have commenced, which did not provide for the claimant. The deceased’s estate passed to his two children from a prior marriage.
The main issue in the proceeding was whether the claimant met the definition of “spouse” set out in the Succession Law Reform Act. The definition incorporates the definition of “spouse” from the Family Law Act, s. 29. There, “spouse” is defined as including “either of two persons who are not married to each other and have cohabited … continuously for a period of not less than three years”. “Cohabit” is defined in the SLRA as meaning “to live together in a conjugal relationship, whether inside or outside marriage”.
The respondents disputed whether the claimant and the deceased lived together continuously for the required three year period. They maintained separate residences. Although this is not conclusive, and parties can have separate residences and still be found to be spouses, the case states that “living together implies something more than having conjugal relations, spending time together or doing so for a long time.”
The claimant was unable to provide sufficient corroborated evidence to support a finding that she lived together with the deceased for the requisite period. The court concluded that “The evidence simply fails to establish the core and necessary fact that [the claimant] and [the deceased] lived together in any arrangement capable of being so described. They needn’t have had a single residence. They needn’t have never been apart. There must however be evidence of an arrangement that, viewed as a whole, can fairly be described as “living together”. Such evidence should be capable of some objective verification and not rely almost entirely upon self-serving general statements of conclusion.”
The application was dismissed with costs. Although the estate trustee incurred costs of over $75,000, they agreed to limit costs to $25,000. The claimant unsuccessfully tried to oppose these costs on the basis of impecuniosity.
Thank you for reading.