Tag: married spouses
Living a double life can be complicated. A double life that involves a secret second family can be especially complicated, both during the deceiver’s life and after their death. How is the deceiver’s estate to be divided as between his first family and his secret second family? What rights does the unmarried secret spouse in particular have in the deceased’s estate? The Supreme Court of British Columbia addresses these issues in its recent decision of Boughton v Widner Estate, 2021 BCSC 325.
Boughton concerns the Estate of Michael Gregory Widern. Michael was a known member of the infamous Hells Angels and died on March 9, 2017 by homicide. Michael left behind his married spouse, Sabrina, and their two children. He also left behind Sara – whom he had been seeing for roughly eight years unbeknownst to his wife – and their two children. While Michael was alive he spent time with both of his families, alternating between the two households. Sabrina had no knowledge of Michael’s second family until after he passed away.
Michael died without a last will and testament, leaving his estate to be distributed in accordance with the intestacy provisions set out in British Columbia’s Wills, Estates and Successions Act (“WESA”). In Boughton, Sara brought a claim against Michael’s estate seeking, amongst other things, a declaration that she is a spouse of Michael for the purposes of the WESA and is consequently entitled to a share of his estate. As such, one of the issues to be dealt with by the court was whether the WESA permits the division of an estate as between two individuals who were in concurrent, subsisting spousal relationships with the deceased at the time of death.
The honourable Justice Jennifer Duncan declared that Sara was a spouse for the purposes of the WESA. Section 2 of the WESA provides that two persons are spouses of each other if immediately before the deceased person’s death they were married to each other or they had lived together in a marriage-like relationship for at least two years. Justice Duncan found that on his death, Michael was still married to Sabrina and was also in a marriage-like relationship with Sara. Section 22 of the WESA states that if two or more persons are entitled to a spousal share of an intestate estate, they share the spousal share in the portions to which they agree or as determined by the court. Justice Duncan reasoned that this section clearly provides for more than one spousal share in the estate of an intestate. She also analyzed the legislative intent of section 22 and found that the intention of the Legislature was to continue to provide for individuals in a marriage-like relationship with an individual who was still married to someone else at the time of death. On this basis, Justice Duncan held that Sara was entitled to a declaration that she is a spouse of Michael as that term is defined in the WESA. It was further ordered that Sara and Sabrina were each entitled to half of Michael’s estate.
If this case were decided under Ontario law we would likely see a different result. Ontario’s Succession Law Reform Act (“SLRA”) has no provision equivalent to section 22 of the WESA which recognizes a “spousal share” in an intestate estate for someone other than the deceased’s married spouse. For purposes of intestate succession in Ontario, “spouse” has the same meaning as in section 1 of the Family Law Act (“FLA”), which is in essence a married person. It follows that an unmarried secret spouse would likely have no statutory entitlement to share in their deceased spouse’s estate. However, a secret spouse in Ontario could potentially claim an interest in their spouse’s estate pursuant to the dependent support provisions contained in Part V of the SLRA. In Part V, “spouse” has the same meaning as in section 29 of the FLA, which defines “spouse” more broadly as including persons not married to each other and have cohabited continuously for a period of not less than three years, or have children together and are in a relationship of some permanence. If a secret spouse meets this definition, they may still have a right to a portion of their deceased spouse’s estate by way of a dependent support claim.
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We sometimes hear about an elderly person marrying a much younger person. What we often do not consider, however, is the possibility that such a marriage is entered into by a “predatory” spouse in order to take advantage of an elderly victim with the ultimate goal of assuming control of his or her finances.
The “predator” is often a caregiver or a family friend or neighbour. In most cases, it is a person who uses a position of trust to cause an elderly victim to change a Will, a power of attorney, an insurance policy designation or other documents. It is also not uncommon for inter vivos transfers to be made while the senior is alive.
According to Ontario law, the act of marriage grants the new spouse certain property rights, specifically with respect to the matrimonial home and spousal support. The most significant effect of a marriage, however, is the fact that the Succession Law Reform Act, revokes any Will executed prior to the marriage. To make matters worse, predatory marriages often occur in private such that the senior’s family members are not aware that he or she has married.
The evidentiary burden imposed upon the elderly victim’s adult family members to prove that a marriage should be declared void as it is a marriage of a “predatory” nature is significant.
Why is it so tough to show that a marriage is void?
Capacity is a fluid concept. It means that a person could have capacity for one task and no capacity for another, as capacity is time and situation specific. Capacity to enter into a marriage, is the lowest threshold of capacity. As such, a person can be entirely capable to enter into a marriage but may be incapable of managing his or her own financial affairs.
In addition, a person likely does not just lose capacity in a day; it is a gradual process such that there is a “grey zone” between having capacity and having no capacity at all. It is in that “grey zone” that a predator will take advantage because a person may start forgetting things but is otherwise capable for all intents and purposes.
Because of that, many are of the opinion that Ontario laws make seniors an easy target for “predatory marriages”. Will there be a change in the law coming our way, in light of the growing phenomenon of such marriages? Only time will tell.
For more information regarding this growing concern and the manner in which this issue has been treated by the courts, please see a paper by Kimberly Whaley of WEL Partners on Predatory Marriages.
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Subsection 14(a) of the Family Law Act provides that property held by spouses in joint accounts shall be intended, in the absence of proof to the contrary, to be owned jointly. The presumption may be rebutted by the spouse who seeks to have such monies excluded from net family property (Belgiorgio v. Belgiorgio, 2000 CanLII 22733 (ON SC)).
In LeCouteur v. LeCouteur, 2005 CanLII 8726 (ON SC), the court held that the husband failed to rebut the presumption of resulting trust in respect of funds in a joint account that had “traditionally been used to carry out family decisions for funding special projects”, such as renovations.
In Belgiorgio, the court held that a joint bank account in which the husband deposited his inheritance was used for household expenses and purchases, and was commingled with household income. The court found that the inheritance lost its excluded character when it was placed in a joint bank account; it was his intention at the time he deposited the funds that was relevant.
In the recent Ontario Superior Court of Justice case of McLean v. Dahl, a husband sought a declaration that he was the sole owner of proceeds in a joint bank account in the amount of $94,565 at the date of separation.
The Court considered the following facts in arriving at a determination that the presumption of joint ownership was not rebutted:
- Both parties used the account as they saw fit; however, it was their practice to consult one another if major purchases were to be made;
- When the parties decided to grant a sizeable loan to friends, the funds came from the joint account. When the funds were repaid to the wife alone, she returned them to the joint bank account;
- When the parties decided to work on their marriage, they agreed to put these funds into a joint account on the condition that both their signatures were required to make a withdrawal;
- Mr. McLean intentionally transferred solely-held funds to the parties’ joint names;
- the spouses discussed major transactions using these funds;
- the parties shared the tax liability for income on these funds.
In summary, the Court observed that “…when the parties agreed to work on their marriage, after Mr. McLean closed the first joint account, they opened a second joint account into which each deposited monies in his or her control. This was the second time that Mr. McLean intentionally placed funds in Ms. Dahl’s control. It is obvious from his pattern of conduct that he intended her to have access to funds in joint accounts.”
Accordingly, the Court found that, “from the time that Mr. McLean added Ms. Dahl’s name to the account, she became a half-owner, and the parties were entitled to one-half the funds in the parties’ joint account in the amount of $47,282 each.”
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David Morgan Smith
Other blogs that may be of interest:
Last week, the Toronto Real Estate Board (“TREB”) released a report that Toronto home prices in the month of June jumped nearly 17% compared with the same month last year. Toronto and Vancouver real estate prices are frequently a news topic, but regardless of where you live, the home often represents the largest and most important asset of a person’s estate.
We have previously written on the rights of common law spouses under the Succession Law Reform Act. However, surviving married spouses have those rights and more. Surviving married spouses also have recourse to the Family Law Act (“FLA”). Under section 6(1) of the FLA, a surviving married spouse can file an election for equalization of net family property. In essence, a surviving married spouse is entitled to half of all the property of the marriage – regardless of who held legal title and regardless of the terms of the deceased spouse’s will.
Ontario has implemented a pecuniary (or payment) regime rather than a proprietary regime. This means that an election in Ontario does not give a married spouse a right to a particular piece of property; instead it gives the surviving spouse a right to receive (or make) a payment. One implication of this is highlighted below, but for now, it should be noted that the law affords special protection to a surviving married spouse’s interest in the matrimonial home. Section 18(1) of the FLA defines the matrimonial home as the property “ordinarily occupied by the person and his or her spouse as their family residence.”
The special protections given to the matrimonial home are numerous. For example, under section 19 of the FLA, a spouse is entitled not only to a payment but to possession of that property.Under section 26 of the FLA, if a deceased spouse owns the matrimonial home as a joint tenant with someone other than the married spouse, the joint tenancy is immediately severed and the surviving spouse is allowed to retain possession of the home, rent free, for sixty days after the other spouse’s death. In addition, even though Ontario has adopted a payment regime, a surviving spouse’s entitlement to ½ of the net value of the matrimonial home is afforded special protection, particularly against creditors.
Thibodeau v Thibodeau, 2011 ONCA 110, is a family law case involving two living spouses, but it is instructive with regard to the rights of a surviving spouse and their interest in the matrimonial home. In this case, an ex-wife obtained a court order for an equalization payment from her ex-husband. The ex-husband then declared bankruptcy. The ex-wife sought an order granting her equalization payment priority over her ex-husband’s unsecured creditors. The Court refused to grant the payee-wife priority over other unsecured creditors of the payor-husband. However, the ex-wife had already received her share of the proceeds from the sale of the matrimonial home. While the Court order did not mean that the ex-wife would not later recover the rest of the payment owed to her – as she had other avenues by which to secure her payment – the case is significant because the ex-wife’s ½ interest in the matrimonial home and rights therein were not prejudiced by her ex-husband’s bankruptcy.
While there is some uncertainty with regard to the prioritization of claims in an insolvent or bankrupt estate, it is likely that a surviving married spouse’s interest in a matrimonial home would gain similar protections in an estate’s context – which, according to the TREB, is good news for married couples who own a home in Toronto.
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Today on Hull on Estates, David Smith and Moira Visoiu discuss the differing ways in which the law treats married spouses and common law spouses.
If you have any questions, please e-mail us at email@example.com or leave a comment on our blog page.
Click here for more information on Moira Visoiu.
Listen to "Domestic Contracts and Disability Planning"
Read the transcribed copy of "Domestic Contracts and Disability Planning"
During Hull on Estate and Succession Planning Episode #51, Ian Hull and Suzana Popovic-Montag discuss estate planning for married spouses and common law relationships. They focus specifically on the nature and consequences of domestic contracts, their provision in Section 63 of the Succession Law Reform Act and the importance of full disclosure.
Ian and Suzana also discuss disability planning and the importance of naming a Power of Attorney for property and personal care.