Tag: Statutory Wills

20 May

Equality and the Debate Over Statutory Wills

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

Amidst this terrible COVID-19 pandemic, as with past crises and other contentious affairs, we see the steady emergence of dichotomies in the policy debate – public health versus the economy, liberty versus protection, individual versus group interests … In some cases, however, we see disputes arise wherein two sides share the same source of inspiration but disagree upon how best to do justice to their ostensibly common cause. Many of history’s religious wars demonstrate this phenomenon – two factions purportedly fighting for the same god, but interpreting the god rather differently. In the context of estates law, this phenomenon is discernible in the commentary surrounding statutory wills in Canada: proponents of statutory wills want to incorporate them in our law out of concern for incapable people’s equality rights, while critics of statutory wills oppose their introduction out of concern for incapable people’s equality rights.

A statutory will, in essence, allows for a judge to execute, revoke or amend a testamentary instrument on behalf of an incapable person. They are often praised for their tax advantages, as they may include testamentary trusts and other tax-avoiding instruments (avoid not evade, an important distinction for the C.R.A.) that are not available to incapable people if their estates devolve under intestacies. The drafter of a statutory will may also arrange a statutory will in a manner that will tend to preserve the affection of an incapable person’s relatives – no spurned children or blindsided spouses, in other words.

There is more controversy with respect to whether statutory wills should be used to “protect”. In one prominent English case, Re Davey, [1980] 3 AII E.R. 342, a 92-year-old incapable woman, who was residing in a nursing home, married one the nursing home’s employees, a man 45 years her junior. The woman’s relatives, alarmed at the prospect of the man gaining everything on an intestacy, applied to the court for a statutory will, and won.

Critics of statutory wills observe that since courts cannot interfere with the testamentary freedom of the capable, they should not have the power to commandeer and transform the estate plans of the incapable. Perhaps, as well, skeptics are wary of variable outcomes (i.e. how judges will devise statutory wills), which may flow from what they may perceive as an excess of judicial discretion – unlike an intestacy, the terms of which are definite and predictable; a similar debate is often had with respect to minimum sentences in criminal law, which boils down to, as with statutory wills, how one balances trust for legislators with trust for judicial discretion, to achieve the best results.

In Canada, only New Brunswick has a statutory will. Section 11.1 of the New Brunswick Infirm Persons Act emphasises that courts must act in concert with what incapable people would want, if competent to make a will themselves. In somewhat of a legal bombshell, however, the Manitoba Law Reform Commission has favoured the adoption of a statutory will in Manitoba’s Wills Act.

Thank you for reading … have a wonderful Wednesday!

Suzana Popovic-Montag & Devin McMurtry

18 May

An Update on Statutory Wills

Suzana Popovic-Montag Capacity, Wills Tags: , , , 0 Comments

Testamentary capacity is a prerequisite to the creation of a valid will. For those who do not possess testamentary capacity, either due to a change in cognitive abilities or because they never possessed it to begin with, this means they are unable to make, change, or revoke a will.

In many cases, these individuals did not have a valid will in place prior to losing the ability to create one. These estates are distributed in accordance with the laws of intestacy. In other cases, circumstances have changed significantly such that if the testator had retained testamentary capacity, he or she almost certainly would have changed the dispositions made in a previous will. However, as a result of the loss of testamentary capacity, he or she is no longer able to do so, sometimes giving effect to absurd results.

EGBB06MSDCTo address these difficulties, some jurisdictions have enacted legislation that permits an application to be made for a statutory will. A statutory will involves providing the courts with the authority to make, change, or revoke a will, on behalf of incapable persons. For more details surrounding the background of these legislative enactments, please see our previous blog posts on the subject here and here.

Following the enactment of legislation granting the courts with this authority, there have been discussions surrounding some of the practical effects that at the time, remained yet to be seen. An update on some of the issues is as follows:

The Mental Capacity Act 2005 (“MCA”), which came into force in England and Wales in 2007, provides the court with the ability to make, change, or revoke an incapable person’s will by determining what would be in the person’s best interests. This is considered a contrast to previous legislation which provided for a “substituted judgment” approach. One argument that has since been raised against the application of the best interests approach has been whether it is compatible with the right to equal recognition under the UN Convention on the Rights of Persons with Disabilities.

A common observation that has been made in support of the use of statutory wills is that they can, at times, be more tax effective than if a person were to die intestate. Accordingly, in some jurisdictions, the use of testamentary trusts has been applied within the creation of a statutory will. For instance, in Australia, the Queensland Supreme Court allowed a statutory will including testamentary trusts in Doughan v Straguszi [2013] QSC 295, where it was shown that the testamentary trusts would protect a wider array of family members and future interests.

Another issue is under what circumstances service can be dispensed with in cases of an application for a statutory will. In the UK, it was submitted in Re: AB [2013] EWHC B39 (COP) that this decision should be taken in accordance with s. 1(5) of the MCA which provides that “An act done, or decision made, under this Act for or on behalf of a person who lacks capacity must be done, or made, in his best interests.” The court held that the principles of the MCA could not be strictly applied to such a decision and that it should be made in exceptional circumstances in accordance with the Court of Protection Rules.

Thank you for reading.

Suzana Popovic-Montag


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