Tag: deathbed giving

29 May

The tricky business of deathbed estate planning

Ian Hull Beneficiary Designations, Capacity, Elder Law, Estate & Trust, Estate Planning, Executors and Trustees, General Interest, In the News, Trustees, Uncategorized, Wills Tags: , , , , , , , , , , 0 Comments

It’s 8:30 am, you’ve just entered your office, and you get a call from the common-law spouse of one of your long-term clients. It’s bad news – your client is in palliative care and has a will from 2001 that he urgently needs to update. Time is of the essence.

You and your assistant can squeeze in time late in the day to see the client at the hospital. But you know it’s a tricky situation that’s fraught with potential problems. Here are a few steps to consider that could protect you and your client before you head bedside.

  • Make sure you have the expertise they need: On the initial call, be sure to ask specific questions about what the client needs done. If there are trusts or other complex arrangements involved, assess whether you have the expertise to assist. If death is imminent, the last thing your client can waste is time in trying to line up another lawyer. So do your due diligence up front.
  • Assess capacity: Capacity issues could be front and centre for clients who are close to death. If possible, contact an attending doctor, explain the legal test for capacity and ask them to confirm his or her opinion in writing as soon as possible, even on an interim basis by email.

Learn more about capacity issues here: https://estatelawcanada.blogspot.ca/2010/12/when-is-doctors-opinion-on-capacity.html

  • Talk one-to-one: You need, and must insist on, time alone with your client, both to do your own capacity assessment and to minimize any unsubstantiated allegations of undue influence. If the situation is at all suspicious, you have a duty to inquire to satisfy yourself that the client is fully acting on their own accord. This is especially important if the client has had multiple marriages or common-law partners, or has been estranged from family members. If you are not satisfied, you may choose to decline to act.
  • Take notes and/or video: Your notes could potentially be used as evidence in a will challenge or solicitor’s negligence action, so be sure to set out the basis for your opinion on issues such as capacity and undue influence, rather than simply stating a conclusion. Consider having a junior lawyer attend with you, to provide a more complete base of evidence. Videotaping the interview may also be helpful, as it can provide important evidence if the will is ever challenged.

Finally, if you have older clients who have indicated a need to revise their will, be proactive. Send them this link and encourage them to act now to avoid the potential drama and perils of a deathbed will: http://globalnews.ca/news/1105176/the-mortality-of-deathbed-wills/

Thanks for reading,

Ian M. Hull

28 Oct

Gifts Mortis Causa

Suzana Popovic-Montag Estate & Trust Tags: , , 0 Comments

Gifts mortis causa (or deathbed giving) have a long and rich history that can be traced back well over 2000 years. As gifts mortis causa began to become more prevalent, concerns were raised that this doctrine could be easily used for fraudulent purposes.

As a result, the common law courts have always been reluctant to embrace it. In fact, the judiciary has not hesitated in providing that giving mortis causa should be strictly defined or abolished altogether.

The primary challenge with these types of gifts is that they lack all the protections and formalities that the law of wills provides. Without these protections, there is a greater risk of fraud and perjury. To combat this effect, the courts have refined the circumstances under which a gift mortis causa can be found to have been made.

In order for a gift mortis causa to be effective, it must meet the following criteria:

  1. The gift or donation must have been made in contemplation, though not necessarily in expectation, of death;
  1. There must have been delivery to the donee of the subject-matter of the gift; and
  1. The gift must be made under circumstances such that the thing is to revert to the donor in case he or she should recover. (Cain v Moon, [1896] 2 Q.B. 283 at 286.)

Furthermore, dependant’s relief legislation has stepped in to claw back any potential deathbed gifts in order to satisfy a dependant’s claim. The Succession Law Reform Act provides:

72.(1) Subject to section 71, for the purpose of this Part, the capital value of the following transactions effected by a deceased before his or her death, whether benefitting his or her dependant or any other person, shall be included as testamentary dispositions as of the date of the death of the deceased and shall be deemed to be part of his or her net estate for purposes of ascertaining the value of his or her estate, and being available to be charged for payment by an order under clause 63 (2) (f),

(a) gifts mortis causa; […]

Interestingly, while the Canadian common law courts continue to struggle with the challenge deathbed giving presents, the civil law in Quebec has taken the pre-emptive step of declaring gifts mortis causa null and void unless it appears in a marriage contract made in due form or can be upheld as a legacy. Article 1820 of the Civil Code of Quebec further provides that a gift made during the mortal illness of the donor will be deemed to be a gift mortis causa and as such, is invalid.

Legislation in common law Canada has been largely silent with respect to this issue. As a result, it has fallen to the courts to address the challenges deathbed giving presents. This has led to  much debate surrounding the Cain v Moon factors, including the meaning of “in contemplation of death,” and whether the person must be “in extremis” for the gift to be valid.

Thank you for reading.

Suzana Popovic-Montag

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