Category: New Media Observations
Late last month, I and many of my colleagues of the Millennial age were treated to a flurry of headlines that many of us in that age bracket were able to piece together, but which might have left those of a more senior generation scratching their collective heads. The battle between Wall Street and an army of social media users over stock trading perhaps led to some new terminology entering the lexicon of those beyond the Millennial age group. No doubt the words ‘Reddit’, ‘subreddit’, and ‘GameStop’ caused a few crossed eyes. Allow me to explain.
GameStop Corporation is a publicly traded company that, for much of the 1990s and early 2000s, operated a slew of brick-and-mortar retail stores selling video games, consoles, and other associated merchandise worldwide. As a bright-eyed middle-schooler during the height of GameStop’s market control, many a Friday night was spent wandering the aisles with friends eagerly looking to spend my allowance on the next craze.
As a result of a shift in the direction of the video game industry towards digital and online fare, as well decreased engagement as a result of the pandemic, GameStop’s brick-and-mortar sales model, and retail models more generally, saw a historic decline in sales and revenue. As the demand for GameStop’s business model declined, so did its share price.
This decline did not go unnoticed by certain savvy Wall Street hedge funds and other institutional investors. Shares in GameStop were a popular purchase among “short sellers” looking to turn a profit as a result of the company’s misfortunes. Briefly summarized, short-selling occurs when an investor borrows a particular stock from a stockholder, then sells that stock to a third-party investor willing to pay current market price for the security, on the short-seller’s expectation that the share price will have decreased by the time the loan from the original stockholder is called. The short-seller would then repurchase the borrowed stock from the third-party investor at the now-lower share price before returning ownership to the original stockholder and earning a profit on the difference.
In the case of the GameStop saga, the short-selling attempts by some large hedge funds and institutional investors did not proceed as planned. Members of a specific community under the Reddit platform – individually, a ‘subreddit’ – discovered in late 2020 that GameStop stock had been ‘shorted’ to an unprecedented degree. In essence, hedge funds and investors had bet significant sums on the continued decline of GameStop, intending to turn a profit as the share price was expected to continue dropping.
Members of the ‘WallStreetBets’ subreddit saw an opportunity to ‘squeeze’ the investors by collectively purchasing a significant portion of the available stock in GameStop, driving up the price-per-share to historic highs and decimating the intended ‘short’. The price-per-share ballooned from around $20 in early 2021 to a staggering $350 per share by the end of January. Many of the investors and hedge funds who had bet on the price decreasing from $20 were now compelled by their loan obligations to repurchase shares at a price many times higher than their initial capital investment, incurring significant losses in the process.
Although the frenzy around GameStop and other publicly-traded companies such as AMC has died down in recent weeks, as of today’s date GameStop is still trading at around $51 per share, more than double the share price at the beginning of the year. The incident has also drawn the ire of securities regulators as well as the US Congress. Game over?
The next blog in this series will tie in the concepts of short-selling and the fundamentals at play in the GameStop incident to the obligations of fiduciaries to act as prudent investors.
Thanks for reading.
Recently, I experienced a series of coincidences involving American filmmaker Wes Anderson. In the span of a handful of days, I came across the newly-released trailer of his upcoming film, The French Dispatch, and had the opportunity to revisit his 2014 hit, The Grand Budapest Hotel.
Not having seen the latter in several years, I had entirely forgotten a key plot point involving a handful of curious estate planning decisions. Although the film was released six years ago, I nonetheless attach a mild spoiler warning.
The plot of the film revolves around a specific bequest of a work of art made by one of the characters in the film, Madame D. The painting, Boy with Apple, is left to Ralph Fiennes’ character, Gustave H, the proprietor of the film’s namesake hotel, per Madame D’s (purported) Last Will and Testament.
Her decision to leave the painting to Gustave, rather than her nephew, Dmitri, creates a firestorm of controversy, not least of all because Dmitri accuses Gustave of murdering his aunt in order to secure
his entitlement to Boy with Apple. In reality, it is strongly hinted in the film that Dmitri is responsible for her murder. As an additional twist, a further Last Will and Testament executed by Madame D is discovered later, which appears to leave the entire residue of her estate, rather than just Boy with Apple, to Gustave. However, it is stated in the film that this further Last Will is only to be given effect in the event that Madame D is murdered.
This single plot point raises a number of points of discussion and policy concerns as to what would transpire if the film were set in Ontario. This blog will explore the nature of Dmitri’s and Gustave’s potential entitlements in the Estate.
Prior blogs have explored the concept of common law forfeiture rules in Canada, which preclude an individual from deriving a benefit from their own morally culpable conduct. Colloquially known as the “slayer rule” in the context of a testator-beneficiary relationship, a beneficiary who is found to have caused the unlawful death of a testator will be deemed at common law to have predeceased the testator, thereby extinguishing any interest in the testator’s estate.
In the film, Dmitri accuses Gustave of the murder of Madame D. In the ordinary course, a conviction proper is not a necessary precondition to the applicability of the slayer rule. Rather, common law suggests that the rule applies strictly in the event that the beneficiary’s deliberate act caused the death of the testator. In theory, Gustave’s interest in the estate of Madame D could be in jeopardy despite the lack of culpability. In practice, despite his efforts to frame Gustave, the evidence would likely show that Dmitri was the culprit, thereby extinguishing any interest in Madame D’s estate.
Of course, the further Last Will purportedly being given effect only in the event a murder adds a further layer of discussion, and will be explored in greater detail in part 2 of this blog.
Thanks for reading.
It is nearly a new year. It is during this time that we reflect on the past year, make goals for the upcoming year, and come across all sorts of ‘best of’ and ‘most popular’ rankings.
As such, I herewith present the most popular estate and trust cases from 2018, as decided solely by me (and without regard to any actual data):
- Moore v Sweet – the Supreme Court of Canada provided clarification regarding the juristic reason competent of the test for unjust enrichment, as well as confirmed the circumstances in which a constructive trust remedy is appropriate in the context of unjust enrichment.
- Re Milne Estate & Re Panda – In Re Milne (currently under appeal), the Superior Court of Justice found that multiple Wills were invalid where so-called ‘allocation clauses’ (also referred to as basket clauses) in the Wills provided the Estate Trustees with the discretion to determine which estate assets fell under which Will. Conversely, in Re Panda, the Superior Court of Justice declined to follow Re Milne and probated the Will notwithstanding the presence of an allocation clause. The Superior Court of Justice also addressed the roles of the court as either the ‘court of probate’ or ‘court of construction’ and whether a Will is a trust that is subject to the three certainties.
- Wall v Shaw – the Court of Appeal (sitting as the Divisional Court) held that there is no limitation period to objecting to accounts in an Application to Pass Accounts. The Court reasoned that a notice of objection does not commence a ‘proceeding’ for the purposes of section 4 of the Limitations Act.
- Seguin v Pearson – the Ontario Court of Appeal reiterated the different tests for undue influence that apply in the inter vivos and the testamentary context.
- Valard Construction Ltd. v. Bird Construction Co. – the Supreme Court of Canada found that a trustee had a fiduciary duty to disclose the terms of a trust (here, it was a bond) to the beneficiary, notwithstanding the fact that the express terms of the trust did not stipulate this requirement.
Thanks for reading!
Find this blog interesting, please consider these other related blogs:
An estate trustee must ensure that the deceased’s debts have been discharged prior to making any distributions. This is usually done by advertising for creditors in a newspaper. With today’s emphasis on technology, however, is advertising in a newspaper still the most efficient way to reach potential creditors?
The Standard Practice
An estate trustee will usually not be personally responsible for paying the deceased’s debts, as debts are paid from estate assets. The estate trustee may be found personally responsible for debts, however, if they begin to distribute the estate prior to paying the deceased’s debts.
An estate trustee may avoid personal liability for failing to pay a debt of the estate if they advertise for creditors. Section 53(1) of the Trustee Act provides personal protection for an estate trustee who advertises for creditors prior to distributing the estate assets.
The standard practice for advertising for creditors is to advertise in a newspaper three consecutive weeks in a location where the deceased lived and worked, and then wait at least one month from when the advertisement was first published to begin administration of the estate. The newspaper publisher will then usually send an Affidavit certifying that the estate trustee has properly provided notice to creditors. The Affidavit can be filed with the court as proof that the estate trustee has taken the proper precautions to advertise for creditors.
Does the Standard Practice Need an Update?
While the newspaper may be the most common means of advertising for creditors, is it the most efficient way to reach a creditor?
It is worth considering advertising for creditors online. Advertising through an online service may be more cost effective than in a newspaper. We have previously blogged on a service that provides online advertisements for creditors, and provides affidavits in support of the estate trustee’s advertisement. Using a service to publish notice to creditors has the potential to reach a larger majority of individuals, in a more cost-effective manner. Furthermore, the internet has the ability to provide information to creditors that may be located outside of the deceased’s jurisdiction, allowing for the advertisement to reach more individuals as compared to a newspaper advertisement that is generally confined to one jurisdiction.
As the Trustee Act does not specify the proper form of advertising for creditors, there is the potential for online services or cellphone applications to provide advertisements for creditors in a more efficient and effective way.
Thanks for reading,
Other Articles you Might be Interested In
As society is becoming more and more digitized, there is an increased need for individuals to consider their online accounts in their estate planning. Today, computers and cellphones can store a wealth of important information about an individual through applications such as Facebook, Twitter and online banking websites. Furthermore, there are many other online platforms such as online gaming websites that individuals can win money or put real money into.
In January 2016, CBC profiled a widow, Peggy Bush, in Canada who had lost her spouse, and a setback in dealing with his property was access to his Apple account. We previously wrote a blog post surrounding this case and online password access here. In Canada, there is currently no legislation or case law that deals with access to online accounts after the account holder is deceased.
To expand further on the accessibility of accounts, it is important to focus on the profitability of such accounts. With the expansive opportunity to play poker online, and put money into things such as betting websites, an issue may be raised in regard to who gets access to those funds upon death. While one may be able to make a small fortune in online activity, there is the chance it may be forgotten in the process of estate planning. This argument can go one step further. With the new craze surrounding games such as World of Warcraft or Pokemon Go, accounts have been selling on websites such as Kijiji for around $400.00. With the ability of individuals to make money off selling gaming accounts, the question becomes whether there is an obligation on an Estate Trustee or administrator to take these potential assets of value into account in distributing an estate. If one has accounts of value online, whether on a poker or betting website or another platform that may result in a profit for the individual, it may be worth considering planning for the distribution of the account.
When conducting your individual estate planning, it is becoming an increasingly important consideration to put in precautions or safeguards for your online accounts. This will ensure that your beneficiaries and estate trustees can access your valuable information or assets. Some options for individuals would be to store their passwords in an online service that would provide the information to selected trustees once the account owner passes away, or to attach a memorandum with a will, or put a provision in one’s will containing all of the individual’s online passwords. Furthermore, if one was an avid online poker player or had a particularly valuable account in the online gaming world worth money, it would be prudent to make a plan to cash out or sell the account.
With society moving in a more digital direction, and many aspects of people’s personal and business lives being increasingly stored or managed online, it is becoming necessary for individuals to consider their digital assets and account access upon the event of their death.
As you may have noticed, our blog has undergone a content freeze over the past two weeks. This was done to facilitate an overhaul of our website. The purpose of the update was to make a mobile-friendly site that meets accessibility standards as prescribed by the Accessibility for Ontarians with Disabilities Act.
Here are some of the changes you may notice. First, as a mobile-friendly site, we have incorporated a responsive design that automatically resizes content depending on the size of your screen. One person estimates that somewhere between 20 to 40 percent of online traffic to law firm websites comes via mobile searches. That number is expected to rise. Given our commitment to delivering high quality content, we also wanted a website that was easy to access, anywhere at any time.
Second, archived on our site is nearly 10 years of material touching on matters of estate and trust law. These include blogs, podcasts, videos and our newsletters (The Probater). The updated site makes finding content easier because the navigation structure is simpler. All of our content has been stored under “Resources.” As such, you are just one-click away from accessing the plethora of information available to you. All of this, we hope, makes your browsing experience simpler and more efficient.
As part of our commitment to delivering the best results for our clients, we hope that our new site delivers the best results for our friends who read this blog and those who frequent our website. We look forward to continuing the conversation regarding estate and trust matters and to serving you however we can.
Thank you for reading.
In the Game of Thrones universe, being born out of wedlock results in significant negative social and legal consequences.
A “bastard” – a term frequently used in the Seven Kingdoms, although no longer considered appropriate in our world – cannot inherit their father’s lands or titles. They are also not entitled to enjoy the “privileges of the House”. The father of a bastard can choose whether to completely ignore the child, or maybe secretly send them some money for support. In the best case scenario, the father will acknowledge the child, assign them a special last name although not the same last name as the father, but will then send the child away to some distant land to be raised by others. There is no law in Westeros which attaches a penalty to having illegitimate children, but socially and religiously it is frowned upon.
A king can legitimize the bastard child of a lord but it’s very rare. Despite all of this, an illegitimate child of royal blood may have a stronger claim to the throne if there are no other legitimate children or, as is the case with the wicked King Joffrey, where a purported child is not actually the biological child of the King but was secretly fathered by another.
Illegitimate children in our world have faced similar disadvantages. Until the passage of the Ontario Legitimacy Act, 1961-61 the disadvantages imposed by law on illegitimate children included being unable to inherit from his or her parents or anyone else. Clauses in wills that exclude children born out of wedlock are still very common. Hopefully, with the increasing acceptance of non-traditional families, any kinds of bias faced by children born out of wedlock will be a thing of the distant past, or strictly limited to fantasy worlds like the one in Game of Thrones.
Have a great weekend!
The online social media giant Facebook has taken steps to respond to the concerns about one’s personal account management upon death. Up until recently, the accounts of members that passed away were either “memorialized” or entrance into the accounts were locked.
On Thursday, February 12, 2015, Facebook introduced a feature entitled “legacy contact” that allows a user to designate another person to manage parts of their account after they die. The member is also given the opportunity to simply have their account deleted altogether after death.
The following features can be utilized by legacy contacts:
- responding to incoming friend requests
- updating the profile and header image
- downloading an archive of a deceased member’s photos
Legacy contacts, however, are not able to view private messages.
The new setting is presently only available to residents in the United States but eventually will be introduced in other countries. Currently, our Security Settings on Facebook in Canada allow members to designate 3-5 friends as “trusted contacts” that can assist if members have trouble accessing our accounts.
The new ‘legacy contact’ setting could become a helpful tool for people planning for the future. However, it is only one aspect of digital estate planning. Facebook is only one social media site, and many people are members of at least 2 or 3. Some tips on how to address modern digital accounts and assets can be found here, here and here.
Thank you for reading,
Leaving a Last Will and Testament is one way to memorialize a final message to one’s surviving family and friends. According to a recent article, however, greater numbers of individuals are using social media from their deathbeds in an effort to document their experience and, eventually, to say goodbye to loved ones.
Some believe that sharing information through social media, and in particular Facebook and Twitter, can assist in bringing attention toward end-of-life issues and allowing more societal openness with respect to chronic and incurable health conditions, death, and the process of dying. Patients and caregivers alike are more frequently providing coverage of the final weeks and days of life than had been possible prior to the advent of social media.
In other jurisdictions, it may be possible in rare circumstances for declarations made via social media platforms to qualify as a will or codicil, giving effect to testamentary dispositions. In Ontario, however, any such testamentary wishes expressed through a social media account would be ineffective absent strict compliance with the formal requirements imposed by sections 4 or 6 and 7 of the Succession Law Reform Act. Contents of social media profiles may, nevertheless, represent evidence of a deceased person’s intentions with respect to giving otherwise effected by a will or other testamentary instrument.
Although lawyers may encounter social media through their work on files and review of client documents, social media is also an effective way for lawyers to communicate with their clients, prospective clients, and colleagues, and share helpful information within the public sphere.
Hull & Hull LLP’s upcoming Breakfast Series presentation next Thursday, June 12, 2014, will cover the topic of Social Media for Lawyers. Special guest, award-winning author Terry Fallis, will join Ian Hull and David Freedman in discussing how to make the best of your firm’s presence on social media. For more information and to register for the Breakfast Series, please visit our website. We hope to see you next Thursday.
Thank you for reading.
You don’t usually go to concerts. With kids and work, you are really busy. Yet, you really want to see that band. You arrange for a babysitter. You sit down at your computer to buy tickets. You snag awesome seats. You go to pay and the website asks you to create an account. You type in your email address and create a password: firstname.lastname@example.org and Joanie<3sChachi. ERROR MESSAGE – Incorrect password. This email is already assigned to a previous user. Damn! What was your password? Then you notice the “forgot password” button. What was the name of your first pet? You enter “Skippy the Great Dog Prince of 17 Home Street”. Sweet! You’re in. Put in your credit card information, buy your tickets and you and your spouse are set for a date night!
For many of us, the above is not an uncommon experience. In fact, you probably have online accounts in vast numbers. It is difficult to remember them all. Facebook, Twitter, LinkedIn, Gmail, Flicker, iTunes, Ebay, PayPal, Amazon, Netflix, Banking, and Credit Cards. This is only the preliminary list of places you probably have an online account. If you do a lot of online shopping you might have accounts with Gilt, Jetsetter, or the Bay. Looking for a deal? Maybe you have a Groupon, Teambuy, or WagJag account. Your online presence is likely far greater than you remember.
Passwords change all the time. We are in fact encouraged to use a variety of passwords and constantly change them. Don’t forget to make sure it has at least 6-8 characters with capitals and numbers. This is all well and good while you are alive. You are likely to remember the exact name of your first dog. After your death, when faced with this same problem, your estate trustee, if they are lucky, might remember that your dog’s name was “Skippy”. ACCESS DENIED.
This may be the best case scenario for an estate trustee trying to shut down an online account. In many cases, estate trustees are outright denied access to accounts on the basis that the account is not truly an ‘asset’ of the deceased. Social Media is in many cases, exactly what it says it is – Social. It is interactive. On your death, it continues. This can cause emotional heartache, or financial obligation (some websites have a yearly fee that automatically gets deducted), not to mention frustration to your estate trustees, among other issues. There is a good chance your estate trustee wants to shut down these accounts. As you can imagine, problems arise.
A recent article published in Pepperdine Law Review discussed the implications of online presence in Estate administration and litigation in the United States (For a brief synopsis, see the Forbes article on the paper here). In Canada, there has been little litigation over this issue. However, how to deal with your digital legacy has been discussed in the Estate world for some time. On our website alone there have been several postings. What I found particularly interesting about the Pepperdine Article, is that much like passwords, the world of dealing with digital assets is constantly changing. Who can claim ownership of those digital assets, and how to do so, not to mention the potential ‘conflict of laws’ issues, is something that legislators and will drafting solicitors will likely be grappling with for years to come, and is unlikely to stagnate.
For now, keep in mind the long term implications of creating any online account, and how that account will need to be managed after your death. After reading the Pepperdine paper, I don’t think that concrete and enforceable answers for planning purposes are easily found, but in my experience, awareness of the problem is the first step to solving it.
Have a great weekend,
Nadia M. Harasymowycz