Tag: Bickhram

27 May

Summary Judgment Awarded Where Testator Obtained Capacity Assessment

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I recently read an Ontario decision involving a will challenge and the court granted summary judgment to the estate trustee on the issue that the Testator had the requisite testamentary capacity to execute her Last Will and Testament. 

In Quinlan v. Caron, the Deceased executed her Last Will and Testament on May 18, 2007 (the “Will”) and she subsequently died on September 7, 2008. Two days before executing the Will, the Deceased underwent a capacity assessment that was recorded on video. The doctor who conducted the capacity assessment concluded that the Deceased had the requisite capacity to create a new Will.

 

The daughter of the Deceased commenced a Will Challenge alleging that the Deceased lacked the mental capacity to execute the Will and undue influence. The Estate Trustee is the son of the Deceased and brought a motion for summary judgment against his sister, arguing that there were no genuine issues requiring a trial as his sister’s claim was not supported by any evidence.

 

The Honourable Justice Tuck put a lot of weight on the capacity assessment and granted summary judgment to the Estate Trustee on the issue of the Deceased’s capacity; however Justice Tuck dismissed the Estate Trustee’s motion for summary judgment on the issue of undue influence. In the decision, Justice Tuck held that “matters of credibility requiring resolution on a case of conflicting evidence ought to go to trial” and he rationalized that there was conflicting evidence in this case, which could suggest that the Deceased was unduly influenced.

 

Thank you for reading and have a great weekend,

 

 

Rick Bickhram – Click here for more information on Rick Bickhram. 

26 May

Die Broke or Leave a Legacy?

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As I was reading the Financial Post, I came across an interesting article entitled, What Will You Do With Your Estate? In this article, Jonathan Chevreau explains that there are two schools of thought when a parent is deciding how to plan their estate.

 

On the one hand, some parents believe in transferring the wealth that they have accumulated during their lifetime to their children. On the other hand, some parents believe in “dying broke”. Although it sounds harsh, parents from the second school of thought, often follow the belief that their “kids should stand on their own feet.”

 

Most of us will fall in between the two extremes; however in his article, Mr. Chevreau reviews the strategies associated with both schools of thought. 

 

Parents who wish to maximize their estate often don’t like to leave their kids with any debts. Parents from this camp are more likely to “Commute the value of their death benefit pensions in order to maximize RRSP assets … wipe out any lien’s on their residence … give an inter-vivos gift to their children and pre-pay their funeral.”

 

In the other camp, parents leaning towards the “die broke” philosophy often try to maximize their assets during their lifetime by using three main techniques: pensions, annuities and reverse mortgages. The nature of all three is to maximize income for the parent and their spouse during their lifetime, while leaving little or nothing for their children.

Wherever along the spectrum you fall, it bears discussing your estate plan with your spouse, kids and a good financial planner or estate planning expert.


Rick Bickhram – Click here for more information on Rick Bickhram. 

25 May

Passing Over an Executor

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In a recent decision out of the Supreme Court of B.C., Re Thomasson Estate, the Honourable Justice Gerow considered the circumstances where the court may pass over an executor, on an application by a co-executor/beneficiary.

The two Deceased (collectively referred to as the “Deceased”) had been married and had four children together, all of whom survived the Deceased. In their Wills, they named two of their children, as their executors, and directed the executors to distribute the estate to three of their four children. 

 

One son commenced this application to obtain an order that would pass over the other son as his co-executor for the Estates. The Applicant argued that it is necessary for the Estates to make a proper enquiry into the nature of inter-vivos transactions between the co-executor Respondent and the Deceased and such an inquiry must be made independent of the co-executor Respondent as he would be in a conflict of interest.

 

The co-executor Respondent opposed the Applicant’s application, and argued, amongst other things, that the court should not interfere with the testator’s right to nominate his or her executor and removing him would be prejudging the case.

In her decision Justice Gerow states:

In the circumstances of this case, it is my opinion that there is a perceived conflict of interest between the co-executor Respondent in his role as an executor and his interest in his personal capacity. If an action is instituted by the executors as a result of the transfer of the Property, it would be against the co-executor Respondent. In my opinion, the co-executor Respondent, in his capacity as executor, cannot attack the transfer of the Property to himself while at the same time maintaining, in his personal capacity, that the transfer of the Property was proper. By making such a finding I am not prejudging the case. I am simply of the view that, in the circumstances of this case, if an action is commenced as a result of the enquiries into the transfer, the co-executor Respondent cannot conscientiously act as a plaintiff in his capacity as an executor in a case where he will be the defendant.

B.C. legislation is unique compared to the legislation that governs estate trustees in Ontario; however, if a similar situation arose, an application seeking similar relief could be brought under Rule 14.05(3) of the Rules of Civil Procedure.

 

 

Rick Bickhram – Click here for more information on Rick Bickhram. 

24 May

Is it Possible to Prevent a Will Challenge?

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In a recent blog published by Forbes, Mr. Bernard Krooks considers strategies that could be used to prevent a Will challenge.

In his blog, Mr. Krooks states that "Will contests often occur after a heir or family member perceives some inequity or unjustness in the distribution of money or possessions laid out in the will.  This can be the result of a lack of requisite mental capacity to execute the will, another’s undue influence over the testator, fraud, or improper execution of the will."


Mr. Krooks suggests that a Lawyer drafting a Will can send the testator to medical professional to obtain an opinion on the testator’s capacity to execute a Will.   This would be strong evidence which could be used to propound the Will, long after the testator has died.


Mr. Krooks also suggests that the drafting Lawyer should consider the use of a videotape at the time the testator is signing the Will.  Mr. Krooks explains that the videotape could be used to show that the testator signed the Will "freely and with the requisite mental capacity to agree." 


The use of a videotape at a will execution,  has significant benefits, but also has numerous problems.  This technique has been the topic of numerous debates between estate and trust professionals.


There are steps that we can take to ensure that the Will is being executed in accordance with the applicable legislation, which could help the estate trustee propound the Will; however there is no legislation in Ontario that would estopp a party who has a financial interest in an estate from challenging the validity of the subject Will.


Thank you for reading,

 

Rick Bickhram – Click here for more information on Rick Bickhram. 

01 Apr

Life was Easier Before the Digital Era…

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In the days prior to the evolution of the Internet, planning and administering an estate was relatively simple as the physical belongings of the deceased could be carefully sorted through, packaged, and divided according to the Deceased’s testamentary document or the applicable legislation.

In the days since the  Internet has become a common household tool, planning and administering an estate has not been so easy. In a study commissioned by Remember A Charity, The Dying in a Digital Age, it was discovered that four in five people own digital assets, but only nine per cent have considered how these will be distributed upon their death.

According to the study, the nation’s digital music collection is worth an estimated £900 million alone.

Three quarters of those surveyed for the study indicated that their digital music and photo collections had strong sentimental value, while eight out of ten said their digital assets were financially valuable.

Rob Cope, director of Remember A Charity said: ”Bank accounts, music and photograph collections are increasingly stored online…meaning families will wave goodbye to a small fortune if details are not passed on.”

There is now an entire cyber existence that both the Deceased and Trustees need to turn their mind to when planning or administering an Estate. For instance, what will become of Facebook, Twitter, Flickr and PayPal accounts? One easy solution is to subscribe to a website called Legacy Locker. Legacy Locker was created in 2009 and it maintains a master list of user names and programs for online bank accounts, social networking sites and document repositories. 

In the digital era, it is important that we consider and make arrangements for how our digital assets will be distributed, and for estate planners, it may be just as important that you consider including in your questionnaire or checklist, a question that forces a client to turn their mind to consider their digital assets. 

Thank you for reading, and have a great weekend.

Rick Bickhram – Click here for more information on Rick Bickhram.

30 Mar

Appointing an Estate Trustee During Litigation

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In a recent court decision, the Honourable Justice Stinson considered a motion from competing family members for the appointment of an estate trustee during litigation.

In Buswa v. Canzoneri, the Deceased died without a Will on September 29, 2010. The Deceased did not have a spouse and was survived by seven siblings, and two children.

The concern in this case was that the Deceased did not leave anyone with legal authority or responsibility to arrange his funeral and dispose of his remains.

Two of the Deceased’s siblings, the Applicants, applied for a Certificate of Appointment of Estate Trustee Without a Will. The daughter of the Deceased, the Respondent, also applied for a Certificate of Appointment of Estate Trustee Without a Will.

 

In his decision, the Honourable Justice Stinson considered the legal interpretation of section 29 of the Estates Act, which reads as follows:

1)  Subject to subsection (3), where a person dies intestate … administration of the property of the deceased may be committed by the Superior Court of Justice to:

 

a)      the person to whom the deceased was married immediately before the death of the deceased or person with whom the deceased was living in a conjugal relationship outside marriage immediately before the death;

 

b)      the next of kin of the deceased;

As the Deceased did not have a spouse, the court considered the definition of “next of kin.” In the Black’s Law Dictionary, “next of kin” is defined as “the person’s nearest of kindred to the decedent, that is, those who are most nearly related by blood.

 

Applying these concepts, the court held that the Respondent daughter was related to the Deceased by blood in the first degree, whereas the Applicants siblings were related to the Deceased in the second degree. Accordingly, the Respondent daughter was appointed as the Estate Trustee During Litigation.

 

Thank you for reading, and have a great day.


Rick Bickhram – Click here for more information on Rick Bickhram.

28 Mar

PLANNING ON WHAT TO DO WITH AN INHERITANCE IS IMPORTANT

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Within the next twenty years, Canada’s baby boomers are in line to inherit a substantial fortune, which will represent the largest transfer of wealth from one generation to the next.

In an article written by Jennifer Power Scott and published in Canadian Living, Ms. Scott discusses the  bittersweet bonanza that many heirs face and cautions the impulsive spender: "There are a lot of people in this world who might go out and blow the whole thing in a week, and that’s not appropriate. Unless you’re well-heeled to begin with, flushing the funds into trips to Las Vegas, sexy cars and plush home theatres probably isn’t the smart way to go."

In her article, Ms. Scott stresses the importance of carefully planning what to do with your inheritance, so that your inheritance can turn into a gift that lasts. Ms. Scott urges those who have received a windfall inheritance to:

  1. Take a breath. Put your inheritance somewhere safe that earns a good guaranteed rate of interest for a few months while you think things through
  2. Once you are ready to make a decision, speak to a certified financial planner
  3. Consider your option, such as satisfying outstanding debts, investing into an RESP for your children, or an RRSP or RRIF for yourself

Essentially Ms. Scott’s article forces her readers to consider their long-term goals as opposed to their short-term goals. "It pays to step back a little bit. Some people will immediately say, I’ve got this money, I don’t deserve it all, and maybe I should start helping out my kids right away. But they need to make sure that their financial future is properly secured before they do that."

Thank you for reading, and have a great day,

Rick Bickhram – Click here for more information on Rick Bickhram.

11 Feb

Famous People That Cannot R.I.P.

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Everyone likes gossip. For those who place themselves in the public spotlight their privacy is constantly invaded, even after death. In an article entitled, “Dead People Science Won’t Let R.I.P.”, Joseph Calamia looks at famous people whose buried bodies have been exhumed. 

Bodies are exhumed for numerous reasons such as to determine the cause of death, to answer historical questions, or identify the deceased, if he or she was either not identified or misidentified at the time of burial.

I found Mr. Calamia’s article to be a little creepy, but nonetheless interesting. For instance, archaeologists discovered Tutankhamen’s tomb in 1922 and subsequently learned that the 19-year-old pharaoh “wasn’t exactly the model of health.” Egyptian researchers learned from genetic testing “that inbreeding and disease may have left King Tut so crippled that he could barely walk.”

In an article entitled, “Michael Jackson’s Body Might Be Exhumed”, it has been suggested that Dr. Conrad Murray’s legal team may be considering exhuming Michael’s body to suggest that an overdosing of propofol was the least of Michael’s health concerns. 

It appears that even after death, there is no expectation of privacy for some. After numerous attempts were made to snatch the body of former U.S. President, Abraham Lincoln, it was decided that Lincoln’s coffin would rest in steel and concrete. Whatever happened to rest in peace?

Have a good weekend,


Rick Bickhram – Click here for more information on Rick Bickhram.

09 Feb

Common Will Mistakes

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Dianne Nice, an author for The Globe and Mail, wrote a piece on her experience in planning her estate. Her article, "Will Mistakes: I’ve Made a Few", focuses on errors that she encountered when creating her estate plan. 

Ms. Nice states that while she was pregnant with her second child, she and her husband decided it was time to draw their wills. Ms. Nice and her husband met with a local estate lawyer and instructed the lawyer to prepare two simple wills with their children’s welfare in mind.  However, no consideration was given to the possibility that either her or her husband could become incapacitated. If this unfortunate circumstance was to occur, it would likely lead to several other legal issues. For instance, after speaking with a reputable estate lawyer, Ms. Nice learned that even though her husband and her were joint owners of their home, if her husband became incapacitated and did not name her as his power of attorney, she would not have the right to sell or refinance their home.  Also, just because they are married, that did not mean she has the right to make financial decisions for her husband without a power of attorney or a guardianship order.

Other common errors that Ms. Nice pointed to were:

•           Placing too much trust in your delegated financial decision maker

•           Avoiding making a will by using beneficiary designations and joint ownership of assets

•           Leaving behind a handwritten or will kit will instead of retaining professional assistance

•           Neglecting to update your will as you enter marriage or a committed relationship

•           Not updating wills to reflect the life stages of your children

•           Trying to change your will by writing on the original or a copy of the will, or using too many codicils

The above errors should provide insight for consideration when we are considering our estate plan.

Until tomorrow,

Rick Bickhram – Click here for more information on Rick Bickhram.

08 Feb

How to Manage Your Inheritance

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In an article published over the weekend, Alison Griffith of the Toronto Star writes that over 21 per cent of Canadian households had received an inheritance averaging $91,000.  This amount is likely to jump as our society continues to age.  As estate lawyers we are often so focused on the importance of advising clients of having an estate plan that we rarely consider the other side: after you have received your inheritance, how do you manage the new found wealth?

Ms. Griffith states: "unexpected money – and sometimes expected money – creates both financial and emotional challenges."Many of us who receive these windfalls often stress over the idea of what to do with the money and how will it be managed. 

In her article, Ms. Griffith recommends that anyone who has received a windfall should follow the following four steps, which will likely assist them in making more informed decisions:

  1. Take a deep breath and acknowledge the reality of the situation.  If you received an inheritance the chances are there is a death of someone important in your life.
  1. Don’t rush.  Ms. Griffith tells a story of an old friend who inherited over $200,000, following the death of her mother.  She advised that she intended on "playing around" in the stock market.  Six month later – she didn’t want to talk about how "play time" ended.  Ms. Griffith states:  "As the calendar advances you almost certainly will change your mind about what you want to do with your windfall.  Meanwhile, park it in short-term GICs or high interest savings account."
  1. Seek advice.  "Contact a fee-only or fee-for-service financial planner who doesn’t sell anything other than their services."
  1. Reduce your expectations.  "Don’t expect your windfall magically to turn you into a blissful resident of Shangri-La."

Receiving an inheritance can cause the beneficiary to experience mixed emotions.   It is important to consider the above steps to avoid making an impulsive decision, which is likely to lead only to regret.  

Rick Bickhram – Click here for more information on Rick Bickhram.

 

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