Tag: Suspicious Circumstances
Considerations for Determining the Validity of Powers of Attorney and Appointing Guardians for Property and Personal Care
In yesterday’s blog, I discussed the recent decision in Rudin-Brown et al v. Brown, 2021 ONSC 3366, focusing on the court’s decision in respect of the admissibility and weight given to the audio recordings of Carolyn Brown’s telephone conversations.
In today’s blog, I discuss the factors considered by the court in (i) determining that the 2016 powers of attorney were invalid, and (ii) declaring Carolyn’s 2009 power of attorney for property to be operative, and (iii) appointing Jeanne and Missy as Carolyn’s co-guardians of the person.
The court applied the factors outlined in Royal Trust Corporation of Canada v. Saunders,  OJ No 2291, to determine whether or not Carolyn’s 2016 powers of attorney were executed under suspicious circumstances. Particularly, the court considered the following:
- The extent of physical and mental impairment of the grantor around the time the powers of attorney were signed;
- Whether the powers of attorney in question constitutes a significant change from the former powers of attorney;
- The factual circumstances surrounding the execution of the powers of attorney; and
- Whether any grantee was instrumental in the preparation of the powers of attorney.
Note, the consideration of “whether the will in question generally seems to make testamentary sense” does not apply to powers of attorney.
The court noted that, among other things, (i) there was evidence that Carolyn was having memory issues at the time the powers of attorney were signed, (ii) after visiting two law firms without success, Gordon downloaded forms for powers of attorney and some will templates from the internet, and (iii) one of the witnesses to the powers of attorney testified that Carolyn seemed “vaguely puzzled” the day she witnessed Carolyn’s signature and also stated that Carolyn said that Gordon had told her to sign the powers of attorney.
The court concluded that the powers of attorney were executed under suspicious circumstances in respect of capacity and undue influence. The court also concluded that Gordon failed to prove that Carolyn had capacity to execute the powers of attorney and declared the powers of attorney to be invalid. In addition, the court found that Gordon “failed to show that Carolyn signed the powers of attorney as a result of her own “full, free and informed thought” and has failed to rebut the presumption of undue influence arising from his and Carolyn’s relationship” and therefore concluded that “even if Carolyn had the capacity to sign one or both powers of attorney, they are not valid due to undue influence.”
In respect of appointing guardians of property and personal care for Carolyn, the court did not solely rely on Carolyn’s 2009 powers of attorney, but rather entered into a detailed analysis to determine who would be appointed as Carolyn’s guardians. As noted by Justice H. J. Williams,
“In appointing a guardian for property, the court shall consider whether the proposed guardian is the attorney under a continuing power of attorney, the incapable person’s current wishes and the closeness of the applicant’s relationship to the incapable person. Where there is an ongoing valid power of attorney, cases in Ontario and elsewhere have held that the court must first determine whether there is strong evidence of misconduct or neglect on the part of the attorney before the court should ignore the wishes of the donor.”
The court did “not hesitate to find that, in accordance with Carolyn’s 2009 power of attorney for property, Jeanne should be Carolyn’s guardian for property and that Carter should be the alternative attorney.” The court noted that in Carolyn’s 2009 power of attorney for personal care, Carolyn had named Gordon and Missy as her attorneys for personal care. While the court was satisfied that Missy would be able to fulfill the duties of guardian of the person, the court was not satisfied that Gordon would be able to do so for several reasons, some of which are outlined below:
- “A guardian must make decisions that are in the incapable person’s best interests”, which Gordon had failed to do consistently for Carolyn.
- “A guardian must seek to foster regular personal contact between the incapable person and supportive family members and friends” and Gordon failed to foster Carolyn’s relationships with Missy or Jeanne.
- “Gordon did not consult anyone other than Carolyn in preparing his guardianship plan.”
- Gordon intended to “discontinue a companion service for Carolyn that had been recommended for her and that she had been receiving and apparently enjoying.” Although Gordon said that “Carolyn does not remember the visits and is unhappy with how much they cost”, the court found that “it is more likely that Gordon was unhappy about the cost.”
- The court was also concerned by the fact that Gordon had failed to follow court orders. He failed to comply with Justice Kershman’s “order to stop recording Carolyn’s conversations.” It is important to note that the court found that “it was evident from Gordon’s evidence that he felt justified in ignoring a court order if he did not agree with it.”
In summary, the court concluded that “it is in Carolyn’s best interests for Missy and Jeanne to be jointly appointed as Carolyn’s full guardians of the person.”
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The doctrine of righteousness is a historical concept that is interesting to consider in the context of estate litigation.
Apparently, it was first developed in the 1800s to protect will-makers from consequences of the actions of those attempting to gain a benefit from another’s Will, specifically through the exercise of undue influence.
The case law on this particular concept is quite sparse.
This doctrine was considered by the Supreme Court of Canada (“SCC”) in Riach v Ferris,  SCR 725 where the case of Barry v Butlin was reviewed. It was mentioned in passing by the British Columbia Supreme Court in Halliday v Halliday Estate, 2019 BCSC 554, without any significant commentary as to its effect or place in a Will challenge.
A more in-depth analysis of this doctrine, however, was provided by the Saskatchewan Court of Appeal (“SKCA”) in the decision of Karpinski v Zookewich Estate, 2018 SKCA 56.
The SKCA held that this doctrine may apply where a person, who is “instrumental” in the drafting of the will, also receives a benefit from the will greater than the other beneficiaries. In that case, there may be a requirement for such a recipient to prove the “righteousness” of the transaction.
The SKCA further noted that the SCC also stated that these rules of law apply to all circumstances that raise the “suspicion” of the Court and not only where a person who is instrumental in the drafting of the Will receives a superior benefit. According to the SKCA, this may suggest that this doctrine is only an example of the Court finding a certain kind of relationship to be a suspicious circumstance such that the burden of proof shifts to the propounder of the Will.
The SKCA’s comments are in contrast to John Poyser’s position set out in his book entitled “Capacity and Undue Influence” where he relays his views that the doctrine of righteousness is its own unique doctrine and ought not to be confused with the concept of suspicious circumstances.
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A recent decision of the Hong Kong Court of Appeal addresses the importance of the solicitor’s role in preparing and attending to the execution of a Will, particularly in the context of a Will challenge. The decision is discussed in this article. Although the decision is from Hong Kong, the test applied in respect of testamentary capacity is, as it is in Canada, the classic criteria from Banks v Goodfellow. In this regard, I found it interesting to consider the Hong Kong Court’s decision.
In Ontario, when a Will has been duly executed, meaning that it has been executed in accordance with the requirements set out in the Succession Law Reform Act, R.S.O. 1990, c. S.26, there is a presumption that the Will is valid. However, where suspicious circumstances are shown to exist surrounding the preparation and execution of a Will, this presumption will be spent, and the propounder will be required to prove that the testator had the requisite testamentary capacity to execute the Will. We have previously blogged about which party must prove certain elements in a Will challenge.
According to the article, the same presumption arising from due execution appears to exist in Hong Kong. In the decision of Choy Po Chun & Anor v Au Wing Lun (CACV 177/2014), the Hong Kong Court of Appeal places some additional responsibility with respect to the “due execution” of Wills on solicitors preparing them. In particular, the Court of Appeal sets out that a solicitor should undertake proper groundwork and make proper enquiries, such as following a checklist from the British Medical Association regarding the assessment of mental capacity, and the “golden rule” that a Will for an elderly or ill testator should be witnessed or approved by a medical practitioner who has examined the testator.
In this decision, the Court of Appeal set aside the lower court’s decision that the Will in question was valid. As the solicitor had not taken the additional steps noted above (namely following the checklist and the “golden rule”), it could not be presumed that the Banks v Goodfellow criteria had been met, and therefore each element of the test should have been asked, and proven by the propounder of the Will.
In reviewing the guidelines set out by the Court of Appeal, as summarized in the article, it seems as though the solicitor is being asked to consider whether suspicious circumstances may appear to exist, and to take additional steps if that may be the case. In particular, the Court of Appeal suggests the following:
- Where Will instructions are given by the children of an elderly testator who is not in good health, the lawyer should meet with the testator personally to confirm instructions;
- In the case of an elderly or infirm testator, the solicitor should follow the checklist noted above; and
- The solicitor should follow the “golden rule” when preparing a will for an aged or seriously ill testator.
While this decision is not binding in Canada, it nevertheless raises some interesting points, which a prudent solicitor may wish to consider and implement in their practice. For instance, it may be advisable to confirm instructions directly with the testator if initially provided by another individual, and take steps to confirm whether a testator has the requisite capacity in circumstances where he or she may be elderly and/or in poor health.
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A recent decision of the New South Wales State Supreme Court considers allegations of suspicious circumstances and undue influence within the context of marital separation and subsequent reconciliation.
Colleen McCullough, an Australian author famous for having written The Thorn Birds and a number of other novels, died in January 2015, leaving an estate of approximately CDN $2 million. McCullough also left a series of testamentary documents executed during 2014 and 2015, several of which contained technical defects. Most of the documents named McCullough’s long-time husband, Ric Robinson, as sole residuary beneficiary. One document executed in July 2014 (and a subsequent purported codicil), however, directed the distribution of the entire estate to the University of Oklahoma Foundation (of which McCullough was a founding member).
The plaintiff, McCullough’s friend and agent who had been named as estate trustee in the Oklahoma Will, challenged the subsequent documents on the basis of lack of knowledge and approval and undue influence. She relied, in part, upon the fact that Mr. Robinson had an affair of which McCullough had become aware in or about 2010, and that, in July 2014, she wished to disinherit him as a result of the state of their relationship around the time of their separation. Further, the plaintiff argued that Mr. Robinson’s request of McCullough that she execute a new Will later in 2014 represented suspicious circumstances.
Notwithstanding the concerns raised by the plaintiff, the Court found that the October 2014 Will naming Mr. Robinson was valid. Evidence in support of such finding included the involvement of McCullough’s lawyer in the preparation of the Will. The Court acknowledged the absence of evidence that Mr. Robinson had pressured or coerced McCullough or her lawyer into preparing/executing the October 2014 Will or that her testamentary intentions remained unchanged following a reconciliation with her husband in late July 2014. The plaintiff’s submission that a request by Mr. Robinson that McCullough make a new Will leaving him an interest in her estate after their relationship had improved was not considered to constitute suspicious circumstances and fell far short of the coercion necessary for a finding of undue influence.
This decision emphasizes the difference between influence and undue influence. Among spouses, a degree of influence is to be expected in respect of estate planning. Such influence does not in itself invalidate a testamentary document and may not even satisfy a judge that suspicious circumstances surround the execution of a will.
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In W. (W.) v Y. (Y.), the testator’s holograph will gifted the entire estate to his second wife, excluding his daughter and son from his first marriage. The daughter commenced a will challenge and brought a motion for directions pursuant to Rule 75.06 of the Rules of Civil Procedure. The respondent second spouse opposed the motion. She sought to have the will challenge dismissed on the grounds that insufficient evidence had been presented to support an inference that the claim should be heard.
A. Gilmore J. heard the motion, examined the issues and made two key rulings:
- Financial Interest – Rule 75.06 allows any person who “appears to have a financial interest in an estate” to apply for directions as to the procedure for bringing a matter before the court. Justice Gilmore concluded that it would be inappropriate at this early stage to determine that the applicant has no financial interest. The threshold is a low one, such that an objector need not prove that she has a financial interest. In any event, the possibility of an intestacy should the will challenge be successful was sufficient to warrant the court’s involvement.
- Suspicious Circumstances – The deceased suffered an aggressive form of brain cancer that his daughter alleged caused cognitive impairments. The evidence adduced raised questions as to (i) the issue of capacity (echoed by Dr. Kenneth Shulman), and (ii) the prospect that certain portions of the will may offend public policy. Given the wording of the offending provisions, notably described as “disconcerting”, this issue was also linked to that of capacity. Gilmore J. ruled that it was not for the court to decide at the directions’ stage as to whether there are suspicious circumstances, but rather whether there is some evidence that would support a trial judge’s finding of suspicious circumstances in order to shift the burden to the propounder to prove capacity. The evidence in this case satisfied this requirement.
This decision reminds us that a motion for directions is often a preliminary procedural step in estate litigation. The court does not require conclusive evidence but only sufficient evidence to support an inference that the claims raise a genuine issue. Opposing such a motion in an attempt to terminate the proceeding as a whole will not often be successful.
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