Tag: personal representative

01 Aug

“Special Parties” and Litigation Guardians in Family Law Proceedings

Umair Estate & Trust, Estate Planning, Guardianship, Litigation, Power of Attorney Tags: , , , , , , , 0 Comments

Where an incapable person is named as a party in a legal proceeding, the appointment of a representative is necessary to ensure that the person’s interests are adequately represented in the litigation.

Litigation Guardians in Civil Proceedings

Rule 7.01(1) of the Rules of Civil Procedure states that, unless the Court orders or a statute provides otherwise, a litigation guardian shall commence, continue or defend a proceeding on behalf of a “party under disability.” The Rules define “disability” to include a person who is mentally incapable within the meaning of sections 6 or 45 of the Substitute Decisions Act, 1992.

Rule 7 of the Rules of Civil Procedure provides additional guidance regarding litigation guardians in civil proceedings, including the powers and duties of a litigation guardian.

But what about parties who are under an incapacity and who are named as parties in a family law proceeding in Ontario?

“Special Parties” Under the Family Law Rules

In Ontario, the Family Law Rules apply to family law cases in the Superior Court of Justice’s Family Court, the Superior Court of Justice and the Ontario Court of Justice. The Family Law Rules provide guidance on the appointment of representatives for incapable persons in family law matters.

Rule 2 of the Family Law Rules defines a “special party” as a party who is a child or who is or appears to be mentally incapable for the purposes of the Substitute Decisions Act, 1992 in respect of an issue in the proceeding.

Pursuant to Rule 4(2), the Court may authorize a person to represent a special party if the person is appropriate for the task and willing to act as representative. If there is no appropriate person willing to act, the Court may authorize the Children’s Lawyer or the Public Guardian and Trustee to act as the representative.

Mancino v Killoran – More Than One Potential Representative

A recent decision illustrates the conflicts that may arise when more than one person believes that they are the most appropriate person to act as an incapable person’s representative in a family law proceeding.

In Mancino v Killoran, 2017 ONSC 4515, the Applicant asserted a claim for spousal support and for an interest in a property against the Respondent (“Michael”). Michael had been diagnosed with Alzheimer’s, and was a resident at a long-term care home. Michael’s sister (“Colleen”) and his son (“Allan”) both sought to represent Michael’s interests in the litigation, and filed affidavits in support of their positions.

Justice Gareau considered Michael’s power of attorneys and testamentary documents, which were executed at a time when Michael was still capable. Allan was named as Michael’s attorney for property and co-attorney for personal care. Allan was also named as the sole Estate Trustee of Michael’s Estate.

Justice Gareau held that “[t]he fact that Michael…, at a time when he had capacity, placed Allan… in a position of trust over his personal property and the administration of his estate indicates that he had confidence in Allan…to represent his best interests.” Michael’s sister Colleen was not named in any of Michael’s testamentary documents, which Justice Gareau found to be a “powerful and persuasive fact.”

The Court concluded that there was nothing in the evidence that would persuade the Court to depart from Michael’s express wishes regarding the management of his property. In the result, Allan was appointed to represent Michael as a special party in the family law litigation.

Thank you for reading,

Umair Abdul Qadir

01 Feb

Section 72 Assets, Dependant’s Support, and Personal Liability of Estate Trustees

Ian Hull Beneficiary Designations, Estate & Trust, Support After Death Tags: , , , , , , , 0 Comments

A recent decision of the Ontario Superior Court of Justice considers life insurance as a Succession Law Reform Act (“SLRA”) s. 72 asset, and the circumstances in which a beneficiary or estate trustee will be ordered to make a support payment personally.

In Bormans v Estate of Bormans et al, 2016 ONSC 428, the Applicant (“Gabriele“), made a claim for dependant’s support under Part V of the SLRA. Gabriele had been married to John Bormans (the “Deceased”) for 38 years, until their divorce in 2010. They had two children together, Jessica and Amanda.

The court order granting Gabriele and the Deceased’s divorce provided for spousal support payments of $500 per month from the Deceased to Gabriele. At the time of the divorce, the Deceased made a warranty to Gabriele that she was the beneficiary of his group life insurance policy which secured his support payments on his death. This term was not included in the court order.

After the Deceased’s death in March 2014, Gabriele enquired of the Deceased’s group life insurance company and was advised that the employer had terminated that coverage. After making a claim in writing for support under the SLRA, Gabriele learned that Jessica had received $70,000 in insurance proceeds as the beneficiary of a separate insurance policy on the Deceased’s life. Jessica was also named as estate trustee in the Deceased’s Will.

Prior to being served with Gabriele’s application for dependant’s support, Jessica had spent a portion of the insurance proceeds. However, she continued to spend the proceeds after she had been served with Gabriele’s application, despite her obligation under s. 67(1) of the SLRA, not to make any distribution of the deceased’s estate.

Usually, if the beneficiary named in a life insurance policy is someone other than the estate, the proceeds pass outside of the estate. However, according to s. 72 of the SLRA, such assets can be deemed part of the estate for the purpose of ascertaining the value of the estate and for funding an order for support of dependants. Therefore, according to s. 72(1)(f) and (f.1), the court found that the life insurance proceeds paid to Jessica were to be deemed part of the Deceased’s estate.

The court found that Gabriele was a dependant of the Deceased under s. 57 of the SLRA and that Jessica was not a dependant. The quantum of support to which Gabriele was entitled was held to be $40,000. Although less than the full amount of the life insurance policy, the court held that the portion of the proceeds spent by Jessica personally prior to notice of Gabriele’s application was not deemed to be available to fund the dependant’s support, nor were the amounts expended for the purpose of her obligations as estate trustee. However, because Jessica was the beneficiary of the funds, and had failed to comply with her obligations as estate trustee under s. 67(1), she was required to personally pay the award of $40,000 to Gabriele.

Thanks for reading.

Ian Hull

26 Mar

Trustees, Estate Trustees, and Adminstratrices – A Disambiguation

Hull & Hull LLP Executors and Trustees Tags: , , , , 0 Comments

Just what to call the person administering an estate in Ontario can be somewhat confusing.  A number of terms have been used over the years.  The same person can be referred to in a number of different ways by different pieces of legislation.  In some cases, there are real differences in the legal effect of these different titles.  I thought it worth taking a brief look at the legal distinctions between the various names that are given to estate trustees.

An executor is a person nominated by the testator in a will to carry out its terms.  There is a feminine form, “executrix” (pl. “executrices”), however the term “executor” is commonly applied to either gender.  An executor’s authority comes from the will itself, and he or she generally has authority to administer the estate with or without an appointment from the court.

If there is no will, there can be no executor.  Upon application, a court will appoint an administrator to handle the affairs of the intestate estate.  There is also a feminine form, “administratrix” (pl. “administratrices”), but again, “administrator” tends to be applied in a gender-neutral way.  An administrator’s authority to act is derived solely from his or her appointment by a court.

If there is a will but no executor, (e.g. where the will does not name an executor or where the named executor is unable or unwilling to act), the court can appoint an administrator to carry out the terms the will.  This person is called an “administrator with the will annexed”.  Like other administrators, an administrator with the will annexed derives authority from court appointment.

One key difference between executors and administrators is that there is a “chain of executorship”.  If an executor, Y, obtains a certificate of appointment for estate X and later dies, the executor of Y’s estate becomes the executor of X’s estate as well.  This chain can continue indefinitely.  However, an administrator’s authority to administer an estate is not heritable in this way and his or her grant of authority dies with the administrator.

Some of our legislation uses the term “personal representative”.  The Trustee Act, for example, defines a “personal representative” as an executor, an administrator, or an administrator with the will annexed.  The Rules of Civil Procedure use the term “estate trustee”, also defined as meaning an executor, administrator, or administrator with the will annexed.  Further, an executor or an administrator with the will annexed can be called “estate trustee with a will”, and administrator where there is no will can be called “estate trustee without a will”.

To make things trickier, many wills create trusts.  Usually the executor/estate trustee with a will/personal representative is also named as the trustee of any trusts created under the will (although a will can appoint different trustees).  When this happens, the estate trustee is also a trustee.  While trustees and estate trustees are generally treated similarly under the law, there are some significant differences  For example, section 2 of the Trustee Act provides a mechanism for a trustee to retire if there are three or more.  The section states that it does not apply to executors or administrators, however, who can only be removed by a court.  Some cases have treated the two offices separately as well, holding that a person can resign or be removed from one office while retaining the other.  An estate trustee can be removed as trustee but still be estate trustee.

I hope that this helps to disambiguate some of the many names that are given to a person who is in the role of administering the assets of a deceased person.  Although many of these terms overlap, it is sometimes important to appreciate the distinctions where they exist.

Josh Eisen

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