Tag: Capacity and Undue Influence
The Victorians consigned themselves to more subtlety in their works of entertainment than we at present do. To all appearances, theirs was decidedly not an age capable of enjoying rap music and HBO comedies. The spiciest themes in their art, therefore, would include marriage intrigues, duels, financial scandals – or, as we see in George Eliot’s Middlemarch – controversial wills and eccentric testators.
The wills and estates subplot in Middlemarch is comprised of all the ingredients that you may see in a modern legal drama: a rich and erratic miser (Mr. Featherstone) manipulating his relatives with implied promises of future bequests; the idle protégée (Fred Vincy) who accumulates debts with the idea that the testator will bail him out; concern over the testator’s attachment to his young caregiver (Mary Garth); a train of impoverished relatives ill-concealing their greedy expectations; and much discussion on why “blood” was deserving and why “strangers” were not.
It is remarkable how little has changed in a century or so with respect to wills and estates. Then, as now, a Mr. Featherstone who promises a bequest, receives consideration, and then goes back on his word, may be found to have broken a binding contract – as occurred in Legeas v. Trusts & Guarantee Co. Likewise, a ruling of unjust enrichment (Moore v. Sweet) or specific performance (Folsetter v. Yorkshire & Canadian Trust Co.) could be made against him/his estate.
Still relevant today are the challenges of undue influence and incapacity. In the story, the scheming relatives are alarmed at Mr. Featherstone’s connection to Ms. Garth. She, all too aware of an undue influence allegation, refuses her patron’s money and ignores him when he orders her, while on his deathbed, to destroy his wills. In return, he throws his cane at her, which is perhaps evidence of incapacity.
Much as we may laugh at the relatives in Middlemarch who repeatedly visit Mr. Featherstone to remind him of his obligations to his “own flesh and blood”, our own law continues to ascribe significance to bloodlines. The Succession Law Reform Act defines “child” based upon conception, and the statute’s intestacy provisions speak of “issue” and the “nearest degree” of kindred. As many an adopted child and step-child knows, with respect to estates law, blood still matters.
There are some marked differences between Eliot’s England and modern Canada. Whereas Fred Vincy was loaned money in part because the creditors knew he was favoured by Mr. Featherstone, we now have businesses openly and explicitly offering advances to those who “have an inheritance coming”. Although we still use the Banks v. Goodfellow test for evaluating capacity, there have been some innovations, such as capacity assessments done after death and more nuanced, neuroscientific understandings of capacity. Lastly, if Mr. Featherstone had died in Ontario in 2020, he could not take as much comfort in tantalizing relatives and then crushing their hopes, for we have dependency support laws whereby testators must provide “adequate provision” for their “dependents”. Perhaps the creation of such laws was influenced, in part, by the ghoulish conduct of such Victorian literary characters.
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Suzana Popovic-Montag and Devin McMurtry.
On a recent trip to Rochester, New York, my fiancée and I had the pleasure of touring the George Eastman Museum and came across an interesting piece of estates lore.
George Eastman, the founder of Kodak and a pioneer of bringing photography to the mainstream, died leaving a Will drawn in 1925. As his wife had predeceased him and they had no children, Mr. Eastman devised all of his real property and left a substantial cash legacy to his closest family member, his niece, Ellen Dryden. Mr. Eastman’s estate held significant assets, and the value of liquid assets alone was estimated as exceeding the equivalent of USD$35 million today.
However, on March 9, 1932, only five days before his death, Mr. Eastman had a change of heart with respect to the distribution of his estate. Rather than leave the bulk of his estate to an individual, Mr. Eastman wished to ensure that his legacy would be one of service to the community that had fostered his photography empire. True to form as a philanthropist and benefactor of local enterprise, Mr. Eastman executed a Codicil to his Will, changing the primary beneficiary of his estate from his niece to the University of Rochester.
The testamentary dispositions under the Codicil represented a significant deviation from those under his Will. Typically, where a testator’s dispositions vary substantially from one instrument to another, concerns may arise with respect to the their testamentary capacity or the presence of undue influence.
A shrewd entrepreneur in his own right, Mr. Eastman recognized the risk that the Codicil might later be the subject of scrutiny or litigation. On the date the Codicil was to be executed, Mr. Eastman hosted a gathering at his residence and invited many guests and acquaintances. He devoted time to speaking to each individual guest about topical, personal subjects so that they could attest to Mr. Eastman’s soundness of mind in the event that a certain disgruntled niece chose to commence a Will challenge.
In a way, Mr. Eastman’s goal is not too dissimilar from some of the criteria that are relied on even today to assess a testator’s capacity. Third-party evidence that a testator appeared to be of sound mind immediately prior to the execution of a testamentary document may help a trier of fact draw a favourable conclusion with respect to capacity. While the formal criteria to assess capacity primarily consider a testator’s appreciation and understanding of his or her assets, Mr. Eastman’s clever scheme demonstrates that he turned his mind to questions about his own capacity and took steps to mitigate the risks.
Mr. Eastman’s Codicil was not later subject to any litigation, and the University of Rochester received a handsome distribution out of his estate.
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Today on Hull on Estates, Ian Hull and Rebecca Rauws discuss the recent Court of Appeal decision in Vanier v Vanier, 2017 ONCA 561, including the different tests for undue influence and the practice of assessing undue influence by capacity assessors.
This week on Hull on Estates, Jonathon Kappy and Umair Abdul Qadir discuss the Court of Appeal’s recent comments on independent legal advice in Donis v Georgopoulos, 2016 ONCA 194 (http://bit.ly/1qLCSqL), where an inter vivos transfer was challenged on the basis of undue influence. Read more about the Court’s decision on our blog. (http://bit.ly/1RYCGi3)
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This week on Hull on Estates, David Smith and Josh Eisen discuss an innovative way to protect a testator from undue influence, proposed by author John E. S. Poyser in his new book, Capacity and Undue Influence.
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