Tag: Graham

06 Jun

Unjust Enrichment, An Encore

Hull & Hull LLP Estate & Trust, Litigation Tags: , , , , , , , , 0 Comments

Hot on the heels of the BC Court of Appeal decision that Sharon Davis blogged on last Friday is the BC Supreme Court decision of Graham v. Ellard, 2011 BCSC 672 (CanLII).

There, a surviving spouse brought a claim against her late husband’s estate for a declaration that she is entitled to a beneficial interest in the estate’s half interest in the home on the basis of unjust enrichment.

The wife and the deceased were divorced in 1998. The divorce order required that their home be sold, and the proceeds divided equally. However, the order further provided that the home was not to be sold until the youngest child was no longer a child of the marriage. However, the home was never sold, even after the youngest child ceased to be a child of the marriage, or following the death of the husband.

The deceased died in 2001. After his death, his estate brought an application to sell the home, but the application was, for reasons that are not clear, dismissed. 

From the date of the divorce until the trial, the wife paid all of the upkeep expenses associated with the home.

In response to the wife’s claim to the estate’s interest in the home, the estate raised a number of defences. The first was that the claim was barred by reason of cause of action estoppel. The estate argued that the sale of the home was ordered at the divorce trial, and thus it was not open to the wife to now raise the issue.

The court held that the wife could have raised the issue of the husband’s contribution to the carrying costs of the home, but didn’t. Her claim on the basis that she was entitled to contribution for carrying costs was therefore dismissed.

However, the court held that the wife’s claim for unjust enrichment was allowed to stand. The evidence was that the value of the home increased substantially: from $195,000 to $395,000. The wife’s claim for unjust enrichment was found to not be res judicata, as it did not exist at the time of the divorce trial. The court held that it was unforeseeable at the time.

The court went on to hold that the estate was unjustly enriched by the increase in the value of the home as a result of the wife paying the carrying costs over the years.

As to a remedy, the court ordered that the home was to be sold and the proceeds divided between the wife and the estate, subject to the estate being liable to the wife for half of the carrying costs paid by her, other than utilities.   No set off for occupational rent was allowed. (The decision contains a good, concise summary of the equitable principles to be considered when considering a claim for occupational rent.) 

Thank you for reading,

Paul E. Trudelle – Click here for more information on Paul Trudelle. 

11 Oct

Wine Cellars: Ringer Estate Planning Tool or Tax Landmine?

Hull & Hull LLP In the News Tags: , , , , , 0 Comments

It turns out that investing in wine cellars as an estate planning tool is more complex than one would think.  The estates of Brits, for instance, who expected that a wine cellar would be valued at its purchase price as opposed to its market value for the purposes of inheritance tax may be in for a surprise, based on the information in this article

Enterprising Brits may have been hoping their estates would pay inheritance tax based on the purchase price of their wine cellars while the appreciation in the wine cellar would be passed on tax-free to the beneficiaries.  Alas, this is apparently not the case in England: Her Majesty’s Revenue and Customs ("HMRC" as they call it over there) are aware that wine can appreciate, therefore wine is not a wasting asset valued at its purchase price, and the wine cellar must be valued at its open market value for inheritance tax purposes.   

While wine cellars may not have favourable tax treatment, at least in England, it strikes me as the sort of asset that may pass outside of probate more often than not.

Thanks for reading,

Chris M. Graham – Click here for more information on Chris Graham.

05 Nov

Ontario’s Unforgiving Formal Execution Requirements for Wills

Hull & Hull LLP Estate & Trust Tags: , , , , , , 0 Comments

The formal requirements for execution of a will, or any testamentary instrument in Ontario, are governed by Part I of the Succession Law Reform Act ("SLRA").  The definition of "will" in s. 1 of the SLRA includes a testament, codicil, will, or other testamentary disposition.  The most critical form requirements are that the will must be in writing, signed by the testator and two witnesses.  Other requirements exist, of course.

Many jurisdictions contain dispensation clauses relaxing the formal compliance requirements, if the court is satisfied that a document or any writing on a document embodies the testamentary intentions of a deceased.  For example, s. 23 of Manitoba’s Wills Act  or California’s Probate Section 6110-6113.  Not so with Ontario, except for holograph wills and for members of the Canadian Forces on active service.  While there is wiggle room in terms of the interpretation of the execution requirements, for instance what constitutes "in writing" or "signed by the testator", if the formal requirements are not met and no specific exemption applies, there is no saving provision based on testator’s intention, and therefore no testamentary instrument.

This can have harsh consequences, by invalidating otherwise perfectly good wills on narrow technical grounds.  On the other hand, the SLRA provides time-tested, black-letter legal clarity.  Time tested, because the formal requirements descend from the Wills Act, 1837.

Have a great weekend,

Chris Graham

Christopher M.B. Graham – Click here for more information on Chris Graham.

16 Oct

Peer into the Crystal Ball: Business Opportunities in an Aging World

Hull & Hull LLP Estate & Trust, Funerals, In the News Tags: , , , , 0 Comments

Whether it’s technology or tv trends, Japan seems to be light years ahead.  And we play catch-up (ok, not so with the stupid game shows).  Japan’s median age is 43.5, Canada’s is 39.1.  But since Japanese live longer (life expectancy of 82.12 versus Canada’s [still respectable] 81.23), we’re really only a few years behind.  So what can we learn from their population, which is a few years ahead of ours in dealing with an aging population?

The answer is: forget about cars, dvd players and even robots.  Funerals are very, very big business in Japan.  According to this Bloomberg article, the Japanese funeral industry is worth US$18 billion.   Last year, 1.14 million Japanese died, and funeral companies charge about $26,094.62 per funeral.  By 2040, 1.66 million will be dying every year.  Future growth is in death, and as Bloomberg notes, "everyone from railway companies to retailers wants a slice."   Funeral companies are stampeding towards Japan.

Unfortunately, things won’t be so rosy in Canada.  This is because Japanese funerals are mostly Bhuddist funerals, which are elaborate multi-day events involving chanting monks, flowers, meals, cremation ceremonies, jade urns and the like.  They are elaborate, exhausting events.  Our funerals are fast-forwarded commercial breaks by comparison.  But it is still a glimpse into the future.

Have a great weekend,

Chris Graham

Christopher M.B. Graham – Click here for more information on Chris Graham.

 

15 Oct

Revival or Republication?

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The concept of reviving a revoked will seems clear enough.  But what is the difference between a revival and a republication, and why does it matter? 

Revival means reactivating a revoked will.  Note that section 19(1) of Ontario’s Succession Law Reform Act requires a revival to be in accordance with the provisions of Part I of the Act.  So an oral declaration that a revoked will is valid does not suffice.  A destroyed will cannot be revived, unless the reviving instrument contains a copy or the terms.  On the other hand, at Common Law, a codicil referencing an existing will "republishes" that will, furnishing evidence of the testator’s considering his will as then existing.  And because the Wills Act, 1837 did not abolish the doctrine of republication, the principle still operates.  Both revived and republished wills are deemed executed on the revival or republication date. 

An attempt to revive a will that was never actually revoked may have the result of republishing that will at the time of the attempted revival.  However, attempting to republish a revoked will not revive a revoked will, unless the acts of republication also satisfy the requirements of a revival (which include the form requirements of the Succession Law Reform Act.  Specific uses of the doctrine of republication are discussed in detail in Macdonell, Sheard and Hull on Probate Practice, 4th ed., Rodney Hull, Q.C. and Ian M. Hull (Carswell: Toronto, 1996), pp. 116-119. 

Have a good day,

Chris Graham

Christopher M.B. Graham – Click here for more information on Chris Graham.

 

 

14 Oct

Motion to Secure Assets Denied

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Rule 45 of Ontario’s Rules of Civil Procedure contains mechanisms by which a party can freeze assets that are in issue or relevant to the proceeding.  However, this should be done prior to the close of pleadings because once the matter is set down for trial, Rule 48.04(1) applies.  Rule 48.04(1) requires that any motion brought after the close of pleadings have leave of the court.  Leave will only be available where there has been a substantial or unexpected change in circumstances.

A recent example of Rule 48.04(1) barring a motion for interim preservation occured in Trapukowitcz Estate v. Royal Bank of Canada.  In this case, an estate trustee was seeking an order that the proceeds of a GIC and a bank account be paid into court pending determination of ownership.  Justice Harris refused to grant leave to bring the motion because, on the basis of the admissible evidence, the estate trustee had not shown a substantial or unexpected change in circumstances. 

Justice Harris followed Machado v. Pratt & Whitney Canada Inc. (1993), 16 O.R. (3d) 250, which requires strong affidavit evidence to demonstrate a "substantial and unexpected change in circumstances to the extent that to refuse the order would be manifestly unjust".  The grounds in the moving estate trustee’s affidavit were unconvincing. 

As importantly, viva voce evidence given in submissions was not considered.  To do so would be unfair to the respondent, particularly since the evidence had been available since June 4, 2009 and the hearing took place in August 6, 2009.  Therefore, Justice Harris cited Rule 37.06(b), which stipulates that every notice of motion must state the grounds to be argued, and refused to consider the viva voce evidence. 

There is no requirement under Rule 45 to prove the assets are actually at risk, so a R. 45 freezing order is easier to get before the close of pleadings.

Enjoy your day,

Chris Graham

Christopher M.B. Graham – Click here for more information on Chris Graham.

 

 

13 Oct

Waiver of Settlement Privilege

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Settlement privilege excludes communications made in furtherance of settlement from the record.  Settlement is a fundamental component of our trial system for trite reasons.  Virtually every litigation proceeding has a parallel settlement component that the court does not and usually ought not to see, until after the main proceeding. 

In Re Hallman Estate, the applicant had filed an affidavit including a letter that was a settlement offer from respondent trustees.  The letter was marked "Without Prejudice".  The trustees brought a motion to expunge that part of the affidavit.  The applicant asserted that the trustees had impliedly waived settlement privilege by relying on the letter in exercising their discetion when, at a trustees’ meeting, they had discussed the letter then refused to pay trust income to the applicant, and later disclosed the minutes of the meeting to the applicant.  Also, the trustees sent a letter to the applicant’s counsel noting that the letter had been discussed and offering to provide redacted minutes.  The issue was whether this constituted implied waiver.

No waiver was found.  Settlement privilege can be waived expressly or by implication.  A clear intention is not always necessary.  The privilege can be waived by conduct (waiver by implication), even in the absence of intention, and one situation where this occurs is where fairness requires it (for instance, taking a position inconsistent with the maintenance of privilege).   

But here, it was the applicant asserting the waiver who first filed the Minutes referencing the letter, not the trustees relying on the privilege.  Second, the communication to the applicant’s lawyer of the reliance on the letter constituted confirmation of non-waiver, not the opposite.  Finally, there was no evidence the trustees actually did rely on the letter to exercise their discretion as trustees, only that they had discussed the applicant’s lack of reply to the letter during the meeting.  On this final point, the decision does not unequivocably state that such reliance would have been sufficient.        

The onus for proving waiver of the privilege rests with the party asserting the waiver, but that should not prevent litigants from fastidiously maintaining the privilege (as the trustees did in this case).

Have a great week,

Chris Graham

Christopher M.B. Graham – Click here for more information on Chris Graham.

 

 

21 Aug

Helpful Resource: Basic Tax and GST Guide for Lawyers 2008-2009

Hull & Hull LLP Estate & Trust Tags: , , , 0 Comments

David M. Sherman’s Basic Tax and GST Guide for Lawyers 2008-2009 (Toronto: Carswell, 2008) is a helpful resource for lawyers not specializing in tax law.  The section on Wills and Estates (chapter 7) is concise, easy to follow, and the annotations are precise.  The style is rule-driven and not overly burdened with qualifications (these appear in the Preface); it is not cluttered with lengthy paragraphs or run-on sentences. 

One criterion I use to rate general texts is how helpful or interesting they are to me in areas outside my field.  This book scores well on that basis.   See, for instance, the section on deductibility of legal fees or health club memberships. 

This text is highly recommended.

And my Friday blogs are always short for you.

Enjoy the weekend,

Chris Graham

 

Chris M.B. Graham – Click here for more information on Chris Graham.

 

 

 

 

 

 

 

18 Aug

$14 Billion Estate Including Offshore Trusts, No Will, 9 kids, Multiple Unmarried Spouses, One Wife, etc.

Hull & Hull LLP Estate & Trust Tags: , , 0 Comments

Wang Yung-Ching died at the age of 91 in New Jersey without a will (so far).   Of course, New Jersey has intestacy laws.  But according to the New Jersey’s Star-Ledger, Mr. Wang owned a multi-national conglomerate worth around US$7 billion (the basic American Dream story: immigrant founds Formosa Plastics)… with at least nine children… by at least two different women in long-term relationships, none of whom was Mr. Wang’s surviving married wife of more than 70 years… and one son has filed court documents alleging additional assets transferred by 2 half-sisters and a cousin, including $7.5 billion in Cayman Islands trusts and $1 billion to a bank in Switzerland … and while Mr. Wang’s corporate headquarters were in New Jersey, he also held approximately $1.7 billion in cash, stocks and real property in Taiwan… and a potential fourth spouse has emerged in Taiwan, with 3 more purported children.  

Mr. Wang’s eldest son, Winston Wong (same surname, just different spelling), has applied to be appointed as the estate administrator in New Jersey.  According to an Associated Press report, last week a judge adjourned a motion made by one of Mr. Wang’s daughters to dismiss Winston Wong’s application on the grounds New Jersey was not the proper jurisdiction. 

Winston Wong also has been granted powers of attorney by Mr. Wang’s wife, and he is applying or petitioning to be appointed her guardian (the reports go no further on this issue).  This is being contested by some other siblings.  The guardianship issue is less hashed out in the reports but with Mr. Wang’s wife entitled to around 50% of her deceased’s husband’s estate if New Jersey’s intestacy laws apply, what are the odds of that changing?   

There’s enough money at stake to ensure every possible issue (or non-issue) gets litigated, across the globe. 

Have a great day.

Chris Graham

Chris M. B. Graham – Click here for more information on Chris Graham.

 

 

 

 

19 Jun

This Blog Contains a Secret to Longer Life

Hull & Hull LLP Estate & Trust, In the News Tags: , , , , 0 Comments

Actually, reading this blog really will help you live longer.  One secret to living longer is to have a "higher purpose", according to researchers at the Rush Alzheimer’s Disease Center (which is part of the Rush University Medical Center in Chicago).  Patricia Boyle, Ph.D. states in the news release announcing the study:

"The finding that purpose in life is related to longevity in older persons suggests that aspects of human flourishing—particularly the tendency to derive meaning from life’s experiences and possess a sense of intentionality and goal-directedness—contribute to successful aging,".    

The study found a correlation between longevity and participant’s level of agreement with 3 particular statements in a "Purpose of Life" questionnaire:

  1. “I sometimes feel as if I’ve done all there is to do in life;”
  2. “I used to set goals for myself, but that now seems like a waste of time;” and
  3. “My daily activities often seem trivial and unimportant to me.”

Guess whether the correlation was positive or negative?  Or read the study here, when it becomes published (it’s not posted yet, but this at least rates a reminder in Outlook) .  

TGIF and find purpose in your weekend.  You’ll live longer.

Chris Graham

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