Category: Support After Death

25 Apr

How are you storing the photos of your life?

Ian Hull Estate & Trust, Estate Planning, Support After Death, Trustees, Uncategorized, Wills Tags: , , , 0 Comments

With the improvement in phone cameras, photographs are a bigger part of our lives than ever, at least in terms of volume. And while digital photos don’t take up any actual space, they can clutter the lives of our loved ones when we leave a mess of hard drives and memory sticks behind, with thousands of photos to sort through.

When we think about arranging our affairs, the author of this blog makes a very compelling argument for including photographs as part of the arrangement process, and organizing family photos so they provide comfort, not nuisance. The article also contains some great advice on how to leave a photo legacy.

Here’s a thought: with photographs now so ubiquitous, it may be possible to actually “do with pictures” what we used to “do with words” in terms of providing a memoir for those we leave behind. The process of reviewing digital photos, scanning older prints, culling and organizing, and then producing a visual timeline of your life, can not only produce a wonderful gift for your family, it can be an important opportunity for reflection for you as well.

While arranging your photo collection may not be top of your priority list during your work life, it might be something you move up the priority ladder when you retire and have the time to devote to the task.

In the meantime, if a parent or older family relative dies and you’re the one sorting through the photos left behind, this article  has some valuable tips on how to make the process both practical and meaningful.

Thank you for reading,
Ian Hull

10 Apr

The Policy of Setting Policy: Cotnam v Rousseau and Judicial Activism

Garrett Horrocks Beneficiary Designations, Estate & Trust, Estate Planning, Litigation, Pension Benefits, Public Policy, RRSPs/Insurance Policies, Support After Death Tags: , , , , 0 Comments

The practice of injecting policy considerations into court decisions has long been a tenet of the Ontario judiciary.  However, such considerations may arguably raise questions that go beyond the scope of the decision.  Cotnam v Rousseau, 2018 ONSC 216, is one such case.

In Cotnam, the Court was tasked with determining whether a pre-retirement death benefit received by a surviving spouse was available to be clawed back into an Estate pursuant to section 72 of the Succession Law Reform Act (the “SLRA”).  The Respondent took the position that section 48 of the Pension Benefits Act (the “PBA”) sheltered the death benefit from being clawed back given that she was the spouse of the Deceased.  The Court disagreed and held that such benefits ought to be available for claw back in order to prevent irrational outcomes resulting from their exclusion.

In the context of the facts at play in Cotnam, the Court reasoned in favour of equity, in particular, to ensure a dependant disabled child of the Deceased was properly provided for. However, the Court’s reasons appear to gloss over a fundamental conflict between the SLRA and the PBA, a clash about which the estates bar might have appreciated some judicial commentary.  Specifically, the Court held that the provisions of the SLRA ascribing pension death benefits as available to satisfy a claim of dependant’s relief ought to prevail over the PBA’s provisions sheltering them from claw back.

Section 114 of the PBA provides that, “[i]n the event of a conflict between this Act and any other Act […] [the PBA] prevails unless the other Act states that it is to prevail over [the PBA].”  The SLRA, in contrast, is silent as to whether its provisions are to prevail over those of the PBA.

However, the Court’s reasons make no mention of the interplay between section 114 of the PBA and the equities of ensuring the dependant daughter in Cotnam was properly provided for.  While we may opine on the fact that the outcome in Cotnam favours equity over rote statutory interpretation, the estates bar is left to grapple with the apparent inconsistency with the intention of the Ontario legislature, and whether it will affect similar decisions going forward.  As of this date, no written decisions have yet interpreted Cotnam, nor has the decision been appealed.  Accordingly, it may be some time before the impact of the decision, if any, is felt.

Thanks for reading.

Garrett Horrocks

If you enjoyed this blog, please consider these other related posts:

Dependant Support and Pre-Retirement Death Benefits

Rehel v Methot: Life Income Funds and Spousal Entitlements

09 Apr

The Support Claim as a Remedy for the Disappointed Spouse

Kira Domratchev Support After Death, Wills Tags: , , , , , , , 0 Comments

Occasionally, a person finds themselves in a situation in which, following their spouse’s death, they were either not adequately provided for under their spouse’s Will or were not provided for at all.

Especially in situations where the deceased fully supported his or her spouse, one viable option is for the surviving spouse to assert a claim for support under Part V of the Succession Law Reform Act, RSO 1990, c. S. 26 (the “SLRA”).

A surviving spouse, either married or common-law as defined in the SLRA fits into the definition of a “dependant” and is thus entitled to support from the deceased spouse’s estate.  The question for the Court is whether the deceased made adequate provision for his/her surviving spouse and, if not, what ought to be the quantum of support.

Under the SLRA, a “dependant” includes not just married spouses, but also either of two persons who,

  • were married to each other by a marriage that was terminated or declared a nullity; or
  • are not married to each other and have cohabited,
    • continuously for a period of not less than three years, or
    • in a relationship of some permanence, if they are the natural or adoptive parents of a child.

It is important to keep in mind that such a claim under the SLRA must be brought within six months of obtaining probate, unless the Court allows for an extension of time. Probate is another term for a Certificate of Appointment of Estate Trustee with a Will that is usually obtained by the Estate Trustee for proper administration of the Estate.

The Court may consider various factors in assessing the nature, amount and duration of support, including the eighteen factors listed under section 62(1) of the SLRA some of which are:

  • The Dependant’s current assets and means;
  • The Dependant’s capacity to contribute to their own support;
  • The Dependant’s age and physical and mental health;
  • The Dependant’s needs – with regard to accustomed standard of living;
  • Any agreement between the Dependant and the deceased spouse; and
  • The proximity and the duration of the Dependant’s relationship with the deceased spouse.

If a claim for dependant’s relief is successful, the Court has broad discretion and can make a variety of orders for support, including but not limited to:

  • A monthly or annual payment, for an indefinite or limited period of time or until the occurrence of a specific event;
  • A lump sum payment;
  • The transfer of specified property, either absolutely, for life, or a specified number of years; or
  • The possession or use of any specified property for life or for such period as the Court considers appropriate.

In any event, if a person believes that they may have a good case for a Dependant’s Support Claim under the SLRA, it is important to consult with a lawyer as soon as possible so as to file the claim within the allotted limitation period and discuss any other options.

Thanks for reading.

Kira Domratchev

Find this blog interesting? Please consider these other related posts:

Dependant’s Support – Do common law spouses have to live in the same residence?

Dependant Support and Pre-Retirement Death Benefits

Can Divorced Spouses No Longer Be Dependants?

 

23 Feb

Man Ordered to Pay Ongoing Spousal Support to Dead Spouse’s Estate

Hull & Hull LLP Estate & Trust, Estate Planning, Support After Death, Uncategorized, Wills 0 Comments

In Marasse Estate (Re), 2017 ABQB 706 (CanLII), the Court of Queen’s Bench of Alberta recently ordered a man to make ongoing support payments to his dead spouse’s estate.

In that case, Tracy and Jean were married in October, 1998.  They separated in April, 2012.  A divorce was granted in March, 2015.

Tracy and Jean entered into a Separation and Property Agreement (“the Agreement”) in October, 2014.  Both Tracy and Jean were represented by counsel.

The Agreement dealt with all issues of spousal support and the division of property.  It provided that Jean was to pay support to Tracy in the amount of $3,000 per month, for 60 months.  Jean’s obligations were secured by a policy of insurance in the event that Jean died before full payment was made.  The Agreement provided that it was non-reviewable by the Court, and that it was binding on and would inure to the benefit of the estate of the parties.  It was otherwise silent with respect to what would happen in the event that Tracy was to die before all payments were made.

Tracy, who was ill at the time of the negotiation of the Agreement, died in June, 2015.  At the time of her death, only 8 of the 60 support payments had been made.

Tracy’s Estate Trustee brought a claim for the payment of the balance of the support payments.  Jean opposed, arguing that:

(a)        as Tracy died, there was no longer economic need on Tracy’s part; and

(b)       Tracy’s right to support was personal to her.

The Court disagreed, finding that it was not clear that the support was “non-compensatory”.  Nothing in the Agreement specifically addressed the conceptual basis for the support payments.

The Court held that the entitlement to support payments was contractual in accordance with the Agreement.  While a claim for spousal support under statute may die with the Claimant, contractual rights do not necessary suffer the same fate.

The Court did not order a lump sum payment of the total of the outstanding payments, but rather, declared that Jean’s obligation to make ongoing payments to Tracy’s estate continued.

Have a great weekend.

Paul Trudelle

 

12 Feb

Does spousal support end on death?

James Jacuta Litigation, Support After Death Tags: , , 0 Comments

Family law has long been clear on the question of spousal support in that it is provided to satisfy the needs of the spouse during his/her lifetime and the entitlement to support does not survive the death of the recipient.

Whether this remains the status quo may have been put into question with the recent Alberta’s Court of Queen’s Bench decision in Marasse Estate. In this case, the couple’s separation agreement required the husband to pay monthly support to the wife for five years. The wife passed away after the husband had made only a few payments, and her estate trustee sought the remaining payments. The husband resisted the claim, asserting that the premise underlying the support was the wife’s need. As she no longer had need, he should not be required to make further payments.

The Court concluded that the estate was entitled to continue to receive the support payments. It reasoned that the contractual agreement of the parties created a juristic reason to continue support for the following reasons:

1.The separation agreement contained the fairly standard enurement clause, which provides that the agreement enures to the parties’ heirs, executors etc.

2. The separation agreement contained a non-reviewability clause that states: “entitlement, quantum, and duration of spousal support is non-reviewable and may not be varied on any material change of circumstances.”

3. The separation agreement was comprehensive, negotiated with give and take on both sides, and it should be considered as a whole.

4. Actual need is not expressed in the agreement to be a precondition to payment. For instance, if the converse to the husband’s argument were true, being that the wife remained in financial need and lived longer than five years, the wife would not have been able to collect any further amounts.

Notably, the parties had also turned their minds in the agreement to what would happen if the husband died before all payments were made, as he agreed to maintain life insurance to secure support in the event of his death.

The Court found that the agreement was unambiguous, and could not be set aside as the parties to it (1) intended it to be a full and final resolution, and (2) there were no new circumstances not reasonably anticipated that led to a situation that could not be condoned.

A recent article found here discusses the Court’s decision.

Thanks for reading and have a good day,

Natalia Angelini

26 Jan

What Hat Are You Wearing, and Why It Matters

Hull & Hull LLP Beneficiary Designations, Capacity, Estate & Trust, Estate Planning, Hull on Estates, Power of Attorney, Support After Death, Trustees, Wills 0 Comments

We act in different capacities: sometimes in a personal capacity, and sometimes in a representative capacity, such as in the capacity as Estate Trustee. What capacity we are acting in can sometimes have a significant impact on our legal rights.

Take, for example, the Court of Appeal decision in Bennett v. Bennett Estate, 2018 ONCA 45 (CanLII). There, four brothers, Dennis, George, Donald and John, owned several parcels of land. They entered into an agreement that provided a right of first refusal in the event that any of them sought to sell any of the lands to a third party. Donald died, and was survived by his wife, Darlene. John died, and his property was transferred to his wife Joyce and two sons.

In 2012, Joyce and her sons proposed to sell their property to a third party. The agreement of purchase and sale acknowledged the right of first refusal, and the sale was conditional upon George, Dennis and the estate of Donald not exercising their right of first refusal. Darlene purported to exercise her purported right to purchase the property.

The third party purchaser took the position that Darlene could not exercise the right of first refusal because she was not a party to the first right agreement. It was acknowledged that Donald’s estate was entitled to exercise the right of first refusal. However, Darlene claimed to exercise the right of first refusal not as estate trustee of Donald’s estate, but as a family member. The motions judge rejected this submission based on the judge’s review of the first right agreement, and the Court of Appeal upheld the motions judge’s ruling.

On appeal, Darlene submitted that she in fact exercised the right of first refusal on behalf of Donald’s estate. However, there was no evidence of any right of Darlene to act on behalf of the estate. In fact, the third party specifically asked Darlene to produce proof of her authority to act on behalf of Donald’s estate, but Darlene refused to produce such evidence. “The appellant [Darlene] had many opportunities to establish the facts upon which she seeks to rely but chose not to do so. As a result, there was no evidence before the motions judge – and no evidence before this court on appeal – concerning the appellant’s ability to exercise the right of first refusal on behalf of the [Donald’s] estate.”

In assessing legal rights and positions, it is important to not only assess what those legal rights are, but to consider in what capacity we hold them.

Thank you for reading. Have a great weekend.
Paul Trudelle

24 Jan

“Estate fails” of the rich and famous

Ian Hull Estate & Trust, Estate Planning, Power of Attorney, Support After Death, Trustees, Uncategorized, Wills Tags: , 0 Comments

You’d think that the rich and famous – who have access to the top professional advisors and strategists – would have airtight estate plans that left little wiggle room for unexpected tax surprises or legal challenges from jilted family members.

But all too often, significant issues arise. This recent article recounts the estate tales of Michael Jackson, Whitney Houston, and Prince, three superstar musicians who all died before their time and died leaving significant estate problems to resolve:

For Jackson, it was the significant undervaluation of his brand (a mere $2,125) which has led to years of estate tax litigation with the IRS. For Whitney Houston, it was a failure to foresee the consequences of her daughter’s struggle with drugs and her early death. For Prince, it was not having a will, with more than 45 people now claiming a piece of his estate. This was an issue we foresaw last year in an earlier blog post.

There are two things that all three performers had in common:

  • They all had significant fortunes; and
  • They all died young (Houston was 48, Jackson was 50, Prince was 57).

While the risk of issues or conflicts increases with larger estates because of the amounts involved, the relatively early ages of these celebrities also played a role. Each death was sudden and unexpected (even with the drug abuse issues that plagued all three), and estate plans were not as fully formed as they would have been had death been foreseeable.

All to say, while few of us expect an early death, all of us should plan for one, just in case.

Thank you for reading!
Ian Hull

10 Nov

Funeral Trends: Cremation Growing

Hull & Hull LLP Estate & Trust, Estate Planning, Funerals, Hull on Estates, Support After Death, Trustees, Wills 0 Comments

A study of 2,000 Brits, reported in the Mirror, shows that 79%  of the population studied dislike the idea of burial. 59% of the population studied would prefer cremation over burial or other options. 21% would like to be cryogenically frozen. 16% are prepared to donate their body to science (56% are considering donating their organs to science).

(Canadian statistics show that in the 60’s, fewer than 5% of all Canadians were cremated. As of 2013, that figure grew to nearly 60%.)

Reasons given by the survey group for eschewing burial include:

  • 38% dislike the idea of being eaten by bugs and maggots;
  • 31% fear being buried alive;
  • 21% are claustrophobic;
  • 18% don’t want to incur the expense of burial; and
  • 17% fear being disinterred by a stranger.

The study notes that while people have strong opinions on the disposition of their body upon death, most are not taking steps to ensure that their wishes are executed:

  • 81% have not put their plans into a will; and
  • 40% have not shared their wishes with families or friends.

As to funeral plans, most have not turned their minds to what type of service they would like:

  • 90% have not given any thought to where their funeral will be held;
  • 56% do not know if they want a religious service;
  • 94% have not considered a guest list.

Why not? The survey found that:

  • 21% can’t bear to think about death;
  • 28% feel that they are too young to be making such plans.

Maitham Mohsin of Skipton Building Society, who commissioned the study, is quoted as saying “It just seems sad that our final opportunity to leave a positive mark on friends and family, for them to ‘hear’ from you one last time, is being delegated by so many of us. Let’s put a stop to this, and plan our own final big bash!”

Although one’s funeral and disposition of body plans are not binding on one’s estate trustee, a testator can appoint an estate trustee who agrees to honour those wishes. Discussion during lifetime can give peace of mind to the testator, and also make the difficult job of the estate trustee an easier one. A documented plan can also possibly avoid issues as between family members, who may each have different ideas of what the deceased may have wanted.

Have a great weekend.
Paul Trudelle

26 Oct

Dependant’s Support – Do common law spouses have to live in the same residence?

Stuart Clark Support After Death Tags: , , , , , , , , , , , , , , 0 Comments

Paul Trudelle recently blogged about the Stajduhar v. Wolfe decision of the Ontario Superior Court of Justice, wherein the court was faced with the question of whether two individuals who did not live together in the same residence could meet the definition of “spouse” for the purposes of seeking support after death pursuant to Part V of the Succession Law Reform Act (the “SLRA“). In ultimately concluding in such a decision that the two individuals did not meet the definition of “spouse”, such that the surviving individual could not seek support after death, much emphasis was placed on the fact that the two individuals did not “live” in the same residence. In coming to such a decision, the court stated:

In conclusion, I find that Branislava has failed to prove that she was a dependent spouse as defined by s. 57 of the SLRA at the time of Jeffrey’s death.  The evidence satisfies me that the couple never lived together and thus did not cohabit for any period of time.” [emphasis added]

But is such a finding in keeping with the previous case law on the subject? Do two individuals need to live in the same residence to be considered “spouses” within Part V of the SLRA?

The definition of “spouse” within Part V of the SLRA includes two people who have “cohabited” continuously for a period of not less than three years. “Cohabit” is in turn defined as “to live together in a conjugal relationship, whether within or outside marriage“. When read together, to meet the “common law” definition of spouse in Part V of the SLRA two people must live together in a conjugal relationship continuously for a period of not less than three years.

As the words “live together” are contained in the definition of spouse, when read in its literal sense it would appear self-evident that two individuals must “live together” in the same residence to be considered common law spouses. Importantly however, this is not how the court has historically interpreted the subject.

Prior to Stajduhar v. Wolfe, the leading authority on what was meant by two individuals “living together in a conjugal relationship” was the Supreme Court of Canada’s decision of M. v. H. In M. v. H., the Supreme Court of Canada confirmed that in determining whether two individuals lived together in a conjugal relationship you are to look to the factors established by paragraph 16 of Molodowich v. Penttinen, which include:

  • Did the parties live under the same roof?
  • What were the sleeping arrangements?
  • Did they maintain an attitude of fidelity to each other?
  • Did they participate together or separately in neighbourhood and community activities?
  • What was the attitude and conduct of the community towards each of them and as a couple?

The Supreme Court of Canada was clear in M. v. H. that the factors established by Molodowich can be present in varying degrees, and that not all categories must be met for two individuals to be considered spouses. When the Ontario Court of Appeal in Stephen v. Stawecki applied the factors employed by M. v. H. specifically to the question of whether two individuals must live in the same residence to be considered spouses, the court concluded that they did not, and that living arrangements are only one of many factors to consider. In coming to such a conclusion, the Court of Appeal states:

We agree with the respondent that the jurisprudence interprets “live together in a conjugal relationship” as a unitary concept, and that the specific arrangements made for shelter are properly treated as only one of several factors in assessing whether or not the parties are cohabiting.  The fact that one party continues to maintain a separate residence does not preclude a finding that the parties are living together in a conjugal relationship.” [emphasis added]

The recent Stajduhar v. Wolfe decision notably does not contain any reference to Stephen v. Stawecki, nor to the Supreme Court of Canada’s previous consideration of the issue in M. v. H., such that it is not clear whether such cases were considered by the court before determining that the two individuals were not “spouses”. As a result, it is not clear whether M. v. H. and Stephen v. Stawecki will continue to be the leading authorities on the issue, such that Stajduhar v. Wolfe is an outlier decision, or whether Stajduhar v. Wolfe represents a new line of thinking for the court on whether two individuals must live in the same residence to be considered spouses.

Thank you for reading.

Stuart Clark

06 Oct

“Looking After” Crystal: Hugh Hefner’s Wife

Hull & Hull LLP Support After Death, Trustees, Wills 0 Comments

Hugh Hefner died on September 27, 2017 at the age of 91.

He was survived by his wife, Crystal, age 31, and four children, two of whom are in their 60s, and two who are in their 20s.

He is reported to have left an estate with an estimated value of about $40m (US), with other assets held in trusts (he apparently sold the Playboy Mansion for $100m (US) in August, 2016).

It has been reported that Crystal will inherit nothing from Hugh’s estate, due to an “iron-clad prenuptial agreement”.  However, it was said that she would be “looked after”.

Investment News has speculated that this could be done in a number of ways. One possible  method is by way of a “Qualified Terminable Interest Trust Property trust” or Q-TIP trust – what we commonly refer to as a “spousal trust”.  The trust could provide for Crystal during her lifetime, with the residue to be distributed to named beneficiaries upon her death.  Properly executed, such a trust can provide for a spouse while maintaining the estate for the deceased’s children. It can also provide significant tax savings through deferral of taxes.

One issue that arises in the Playboy scenario that doesn’t often arise elsewhere is the ages of the players: Crystal is only 31, while her oldest step-daughter Christie is 64. Assuming normal life expectancies, Hugh’s older children may never benefit from the residue of the trust.

Another scenario posited by Investment News is the use of insurance proceeds to fund a trust or annuity for Crystal.  However, they observe that Hugh was 86 at the time of his marriage to Crystal, and the cost of purchasing significant coverage would be extreme.

More recent reports state that Crystal will survive Hugh with a Hollywood Hills home, which was held in a trust controlled by her (or jointly owned by Crystal and Hugh, depending on what webpage you read), and also $5m (US) from his estate.

As to Hugh’s estate, it is believed that it will go to his children and charities.

Hugh Hefner once said “I’m actually a very moral guy.”  Hopefully, and to the extent possible, he did the right thing on death.

Have a great Thanksgiving weekend.

Paul Trudelle

 

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