Tag: public policy
Since the Supreme Court of Canada’s landmark decision in Carter v Canada (Attorney General) and the subsequent decriminalization of medical assistance in dying (“MAID”) in 2016, there has been considerable debate regarding the accessibility of MAID.
Currently, MAID is available only to individuals able to satisfy the following test (set out in the Criminal Code):
- they are eligible — or, but for any applicable minimum period of residence or waiting period, would be eligible — for health services funded by a government in Canada;
- they are at least 18 years of age and capable of making decisions with respect to their health;
- they have a grievous and irremediable medical condition;
- they have made a voluntary request for medical assistance in dying that, in particular, was not made as a result of external pressure; and
- they give informed consent to receive medical assistance in dying after having been informed of the means that are available to relieve their suffering, including palliative care.
The criteria do not feature any mechanism for providing advance consent to MAID. Similarly, an attorney or guardian of personal care cannot consent on behalf of the patient at the time of the procedure, once he or she loses the capacity to consent him or herself.
As it currently stands, an individual who qualifies for MAID must consent at the time of the procedure, before he or she may suffer from diminished mental capacity that compromises the patient’s ability to provide informed consent. In some cases, this has resulted in individuals accessing MAID before they otherwise may have chosen to do so to ensure that they would not be exposed to prolonged suffering during a subsequent period of incapacity, during which MAID would not longer be accessible.
Some individuals and groups, including Dying with Dignity Canada, argue that the laws regarding MAID should be amended to provide for the option of providing advanced requests for MAID.
According to a recent Toronto Star article (“No rush to change assisted-death law”, published on February 17, 2019), Justice Minister David Lametti has stated that MAID laws will not be updated in advance of a five-year parliamentary review in 2021 of how the current MAID regime is operating. At that time, it will no doubt be difficult in considering any changes to balance the rights of those with grievous and irremediable medical conditions to die with dignity on one hand, and the protection of individuals who are vulnerable and whose capable wishes can no longer be confirmed on the other.
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Section 241.1 of the Criminal Code sets out a detailed procedure for determining when medical assistance in dying can be provided. However, the medical and legal communities are still grappling with the application of the provisions.
In A.B. v. Canada (Attorney General), 2017 ONSC 3759 (CanLII), two physicians concluded that AB met the criteria for a medically assisted death. A third doctor, however, did not, as he felt that AB did not meet the Criminal Code requirement that a natural death was reasonably foreseeable. Although only two medical opinions are required, the opinion of the third doctor had a chilling effect on one of the other physicians, who declined to provide assistance to AB for fear of being charged with murder.
AB then applied to court for a determination that she met the requirements of the Criminal Code, and a declaration that she may receive medical assistance in dying.
Justice Perell, who had previously considered the issue of assisted death in another proceeding, heard the application.
Ontario and Canada took the position that a declaration should not issue, as the regime established by the Criminal Code does not require judicial pre-authorization. Further, the civil courts should not issue a declaration as such a declaration would interfere with the prosecutorial discretion of the Crown by predetermining criminal liability.
Justice Perell agreed with the position of Ontario and Canada. However, he felt that their position was “as unhelpful as it is technically correct.” The practical effect of such a position was that AB qualified for medically assisted death, but no physician was prepared to assist.
In his decision, Perell J. thoroughly reviews the legislative history of medical assistance in dying. He agrees that it is the medical practitioner and not the court that is to decide whether the Criminal Code criteria are satisfied. He agrees that the court cannot make the decision for them.
However, Perell J. expresses that some form of declaration would be “useful” and have “utility”.
Perell J. walks a fine line in his decision. He accepts that the court is not to make declarations that the Criminal Code criteria for assisted death are met: that must be done by the medical practitioner or nurse practitioner: s. 241.2(3)(a). What Perell J. does, however, is attempt to clarify what is meant by s. 241.(2)(d): the provision that requires the person to meet the criteria that “their natural death has become reasonably foreseeable”. As a matter of statutory interpretation, he declares that in AB’s case, AB’s natural death is reasonably foreseeable.
Perell J. cautions that in making a declaration, he is not conferring immunity on the physicians from prosecution. He also states that he is not finding that courts could or should grant pre-approvals for persons seeking medical assistance in dying. It is unclear as to whether this will provide much comfort to medical practitioners.
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The practice of injecting policy considerations into court decisions has long been a tenet of the Ontario judiciary. However, such considerations may arguably raise questions that go beyond the scope of the decision. Cotnam v Rousseau, 2018 ONSC 216, is one such case.
In Cotnam, the Court was tasked with determining whether a pre-retirement death benefit received by a surviving spouse was available to be clawed back into an Estate pursuant to section 72 of the Succession Law Reform Act (the “SLRA”). The Respondent took the position that section 48 of the Pension Benefits Act (the “PBA”) sheltered the death benefit from being clawed back given that she was the spouse of the Deceased. The Court disagreed and held that such benefits ought to be available for claw back in order to prevent irrational outcomes resulting from their exclusion.
In the context of the facts at play in Cotnam, the Court reasoned in favour of equity, in particular, to ensure a dependant disabled child of the Deceased was properly provided for. However, the Court’s reasons appear to gloss over a fundamental conflict between the SLRA and the PBA, a clash about which the estates bar might have appreciated some judicial commentary. Specifically, the Court held that the provisions of the SLRA ascribing pension death benefits as available to satisfy a claim of dependant’s relief ought to prevail over the PBA’s provisions sheltering them from claw back.
Section 114 of the PBA provides that, “[i]n the event of a conflict between this Act and any other Act […] [the PBA] prevails unless the other Act states that it is to prevail over [the PBA].” The SLRA, in contrast, is silent as to whether its provisions are to prevail over those of the PBA.
However, the Court’s reasons make no mention of the interplay between section 114 of the PBA and the equities of ensuring the dependant daughter in Cotnam was properly provided for. While we may opine on the fact that the outcome in Cotnam favours equity over rote statutory interpretation, the estates bar is left to grapple with the apparent inconsistency with the intention of the Ontario legislature, and whether it will affect similar decisions going forward. As of this date, no written decisions have yet interpreted Cotnam, nor has the decision been appealed. Accordingly, it may be some time before the impact of the decision, if any, is felt.
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Earlier this week, the controversy surrounding the estate of American real estate developer and multi-millionaire John Chakalos dominated the headlines.
Issues Surrounding Mr. Chakalos’s Estate
Mr. Chakalos, who left a sizeable estate, was found dead at his home in 2013. Pursuant to the terms of Mr. Chakalos’s Will, his daughter Linda was one of the beneficiaries of his estate. Linda went missing and is presumed dead after a boat carrying her and her son, Nathan, sank during a fishing trip.
According to media reports, Linda’s son Nathan was also a suspect in the death of his grandfather, but was never charged. Nathan has denied the allegations regarding his involvement in his grandfather’s death and his mother’s disappearance.
According to an article by TIME, Mr. Chakalos’s three other daughters have now commenced a lawsuit in New Hampshire wherein they have accused Nathan of killing his grandfather and potentially his mother. The plaintiff daughters have asked the Court to bar Nathan from receiving his inheritance from Mr. Chakalos’s estate.
Public Policy and the Law in Ontario
It is important to note that Mr. Chakalos’s grandson has not been charged in the death of Mr. Chakalos, and the allegations against him have yet to be proven. However, there have been similar cases in Ontario where the accused beneficiary has ultimately been found to have caused the death of the testator.
Generally speaking, in Ontario, a beneficiary who is found to have caused the death of the testator is not entitled to benefit from their criminal act. This common law doctrine, often referred to as the “slayer rule,” stands for the proposition that it would be offensive to public policy for a person to benefit from the estate of a testator if the Court concludes that they have caused the death of the testator.
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Umair Abdul Qadir
An in terrorem condition attached to a testamentary gift keeps a beneficiary “in fear” of losing entitlement to the gift, if they partake in certain actions that are noted by the testator.
We have previously blogged about the use of in terrorem conditions, and specifically when the conditions will be upheld, or struck down. Kent v McKay (1982 Carswell BC 187) is authority for the test of striking down an in terrorem condition.
There are two general types of in terrorem conditions.
The first type of condition, and the most common, forbids the beneficiary from contesting the validity of the will. We have previously blogged on this type of in terrorem condition.
The second condition is partial restraint on marriage, which is usually a condition that requires the beneficiary to obtain consent to marry. This condition may only apply if it is clear from the outset that the condition in the will is not a total restraint on marriage. Total restraints on marriage will be void from the outset. A partial restraint on marriage may act to limit a person from marrying a particular individual, or members of a particular class. It is likely, however, that any restraint on marriage will be found void for public policy reasons. The recent Court of Appeal decision in Spence v BMO Trust Company, 2015 ONSC 615, is relevant to the issue of restraint on marriage and public policy. A previous blog on this case can be found here.
Pursuant to the decision of Re Dickson’s Trust (1850) 61 ER 909, in order to validate an in terrorem condition, the testator must show that the condition would be given effect if the testator demonstrated their intention by way of a gift over.
As explained in The Law Relating to Wills: “a condition in restraint o[n] marriage or a condition not to dispute a will, may be annexed to a testamentary gift, but where the subject of gift is personalty, such a condition… must, as a general rule, be accompanied by a gift over, otherwise the condition will be treated as merely in terrorem and therefore, void.” The case of Ketchum v Walton, 2012 BCSC 175, suggests that in terrorem conditions in general have been held to be void, if not accompanied by a gift over.
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How far can one’s discriminatory beliefs endure in regard to estate planning?
We previously blogged about the Ontario case of Spence v BMO Trust Company (2016 ONCA 196 [CanLii]), where a daughter was disinherited by her father due to her relationship with a white person, what she argued was a “racist principle”. The will had a condition that disqualified Spence from the inheritance because of her relationship. The will was ultimately upheld, and she was disinherited, with her leave to appeal denied by the Supreme Court of Canada. Following this case, it remains unclear whether the court is willing to uphold discriminatory wills or bequests as a whole.
A recent case in New York follows in Spence’s footsteps. A New Jersey woman’s leave to appeal was denied after she argued she was disinherited by her father for falling in love with a Jewish man. She states the will, created in 1987, contained defamatory statements about her behaviour that were put in the will in order to justify her disinheritance.
A Canadian case that ruled the opposite way and managed to strike down a bequest was McCorkill v Streed (2013 NBQB 249 [Canlii]). In this case, a testator left the remainder of his estate (around one million dollars) to a Neo-Nazi organization. This inheritance was declared void for being contrary to public policy.
While the law in Canada has ruled two different ways, there ought to be consistency and change in acknowledging discriminatory bequests. As I previously stated in an article for the Law Times in June, the Spence decision, and now the added New York decision is troubling. The courts should have guidance when these sorts of discriminatory issues arise based on the facts of the case. Discriminatory wills or bequests should be seen as contrary to public policy and therefore disallowed. It should be the job of the legislature, and not the courts, to create a statutory mechanism that will provide a safeguard for heirs who are disinherited from estates that they otherwise would be entitled to. This issue becomes a balancing act between public policy and testamentary freedom. In drafting wills for those who may want to add a discriminatory condition, there is currently no determinative precedent as to what the courts will uphold due to the somewhat conflicting results from Spence and McCorkill.
Legislation ought to be developed to promote equality in estate planning to ensure that potentially discriminatory gifts will not be upheld in a court. While there is no clear legal stance, practicing lawyers who draft wills should now inform their clients of the potential that certain gifts may be barred due to being against public policy.
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On June 9, 2016, the Supreme Court of Canada rendered its decisions in applications for leave to appeal two recent cases that have been closely watched by the estates bar.
The Supreme Court has dismissed both applications for leave to appeal the recent appellate decisions, which considered a court’s ability to intervene and set aside a Will or a bequest under a Will for violating public policy.
In Spence v BMO Trust Company, 2016 ONCA 196, the Deceased made a Will that disinherited one of his daughters, Verolin. Although the Will was not discriminatory on its face, Verolin sought a declaration from the lower court that the Will was void and relied on extrinsic affidavit evidence to argue that the Deceased had disinherited Verolin for racist reasons.
The lower court accepted the extrinsic evidence and held that the Will was invalid on the basis of public policy. However, the Ontario Court of Appeal allowed the appeal of the BMO Trust Company, holding that the Will was clear on its face and did not offend public policy. You can read and hear more about the Court of Appeal’s decision, which now stands as the final judgment in this case, on our blog and podcast.
The Supreme Court has also denied leave to appeal the New Brunswick Court of Appeal’s decision in Canadian Association for Free Expression v Streed et al, 2015 NBCA 50 (more commonly referred to as the McCorkill decision).
In McCorkill, the testator left the residue of his Estate to the National Alliance, a white supremacist organization based out of the United States. Much like Spence, there was no discriminatory language on the face of the Will. However, the lower court set aside the bequest to the National Alliance because the purposes and activities of the beneficiary organization were contrary to public policy. The lower court’s decision was upheld on appeal to the New Brunswick Court of Appeal. We have previously written about the McCorkill decision here, here and here.
Spence and the McCorkill are not the only two recent cases where a Will has been challenged for being discriminatory. My colleague Noah Weisberg has reported on a claim in British Columbia where a testator is alleged to have disinherited his daughter on the basis of her sexual orientation.
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Umair Abdul Qadir
In a decision released last week, the Ontario Court of Appeal in Andrade v Andrade set aside a judgment and issued a decision that established sole beneficial ownership in a house by way of resulting trust. This decision provides an interesting analysis of the source of funds used to purchase property and the effect this can have on a resulting trust claim. It also provides an interpretation of the public policy principle that prevents a party from taking one position for tax purposes and another in respect of a claim in litigation.
Luisa Andrade (“Luisa”), a widow and mother of seven children, immigrated to Canada in 1969. Luisa’s children each left school as teenagers and began working to support the family. The children continued to contribute their wages to the family until they left the family home.
The family home was purchased in 1974. Luisa signed the offer to purchase and borrowed a cash deposit of $1,000. The bulk of the purchase was financed with two mortgages. Legal title was initially placed under the names of two of Luisa’s children, Henry and Maria, because Luisa was not employed and could not obtain the mortgage on her own. Five years later, legal title was transferred to Henry and another one of Luisa’s children, Joseph. Joseph died in 2014 and his widow, Manuela, commenced a claim seeking a declaration that she was the beneficial owner of the house. Manuela was successful at trial.
The Court of Appeal held that the trial judge committed a palpable and overriding error in concluding that Luisa had no money of her own as it caused him to ignore the evidence of Luisa’s intention to remain the beneficial owner. This caused him to ultimately reject the resulting trust claim. The Court of Appeal noted that the trial judge confused the question of whether Luisa had money with the source of her money. This resulted in a mistaken characterization of the money that was given to Luisa by her children and used by Luisa to pay for the house as the children’s money. However, in accordance with the legal principles of a gift, once the money the children earned was given to Luisa, it became Luisa’s money, “even if it was expected to be used, and was in fact used, for the support of the family, including to pay the mortgages”. The Court of Appeal observed that there was no evidence that Luisa’s bank account was a trust account nor that the money was earmarked for a specific purpose. Furthermore, it was the testimony of all the children that the money they gave to Luisa was her’s to use as she saw fit.
Once the Court of Appeal found that Luisa did have money of her own, it went on to find that her intention was not to benefit the legal title holders to the exclusion of her other children.
On another note, the trial judge found that this was not an appropriate case to impose a trust due to public policy concerns. At various times, Luisa rented out the upstairs apartments of the house. Although Joseph and Henry never received any rent from the house, they declared the rental income and claimed expenses. Luisa, on the other hand, never paid rent yet she claimed a rental tax credit. Specifically, the trial judge was concerned that it would be against public policy to recognize Luisa’s estate (as Luisa had since died) as the beneficial owner of the house when she had received tax credits claiming that she was not the beneficial owner.
The Court of Appeal found that while the “clean hands” doctrine and considerations of illegal purposes may bar a claim, actions unrelated to a claim will not necessarily bar a remedy. In the case at hand, the evidence was not that Luisa placed the house in her children’s names for strategic tax purposes. Rather, Luisa had done so because she was unable to obtain the mortgage on her own. As the equitable relief sought by Luisa’s estate was in relation to Luisa’s interest in the family home, the Court of Appeal found that her tax filings were not fundamental to that cause of action.
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This week on Hull on Estates, Natalia Angelini and Umair Abdul Qadir discuss the Court of Appeal’s recent ruling in Spence v BMO Trust Company, 2016 ONCA 196 (http://bit.ly/1RJfrnR). The Court of Appeal overturned the controversial decision of the Superior Court of Justice, where the Court had set aside the deceased’s Will because it was contrary to public policy based on extrinsic evidence.
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Last year, Spence v. BMO Trust Company, 2015 ONSC 615 was one of the most significant estate cases of 2015. In Spence, the testator made a Will that unambiguously and unequivocally disinherited one of his daughters. The disappointed daughter applied to the Ontario Superior Court of Justice for an order setting aside the Will on the ground that she was disinherited solely because she had a child with a white man. A third party swore an affidavit corroborating the Applicant’s evidence that her father disinherited her for reasons that were racially discriminatory. Justice Gilmore accordingly set aside the entire Will on the basis that it was contrary to public policy against racial discrimination. The Respondent BMO Trust Company appealed the decision.
This week, the Ontario Court of Appeal released its long awaited ruling in Spence v. BMO Trust Company, 2016 ONCA 196. The Court of Appeal overturned Justice Gilmore’s decision, stating that the principle of testamentary freedom to choose one’s beneficiaries is generally immune to judicial scrutiny.
In reaching its decision, the Court of Appeal appears to have significantly restricted the scope of the public policy doctrine in estate cases. Simply put, a Will that does not impose any conditions that, on its face, offend public policy appears to be valid regardless of the testator’s intentions. Thus, the Court in Spence found that the testator was free to disinherit his daughter even if his intention appeared to be racially discriminatory.
It remains to be seen whether the Applicant will seek leave to appeal to the Supreme Court of Canada.
To hear an interesting discussion about the earlier decision in this case check out Hull on Estates podcast #404