I recently learned that an old neighbour of mine was residing in a long-term care facility and I decided to visit him. As a child, I remember my neighbour would often come out to join us in a pick up game of baseball or street-hockey. Having known my neighbour to be a strong and vibrant individual, and despite having prepared myself, it was nonetheless disarming for me to see him in need of assistance and so dependent on others. Although, in my practice, I have cause to consider the issue of capacity almost daily, this experience caused me to reflect on the issue in a much more personal fashion.
Lawyers, particularly in our area of practice, are often required to consider capacity issues and it is easy to allow our personal views to affect our analysis. For instance, if my neighbour left his entire estate equally among his three children, in most circumstances we would presume he had capacity. However, if he left his estate to his caregiver, to the exclusion of his children, most of us would be inclined to conclude that he had either acted for want of capacity or was perhaps coerced to make a Will while vulnerable to undue influence.
People do not typically become incapacitated overnight, except in circumstances where a catastrophic event has occurred. Capacity to make a Will has been described as knowing and understanding the nature and effect of your dispositions and understanding who would be the natural persons to enjoy the bounty of their estate.
In making this determination, if there is any doubt regarding a client’s capacity it is surely advisable to obtain the appropriate capacity assessment in the circumstances.
Have a great week!
The 11th Annual Estates and Trusts Summit was held in Toronto on November 19 and 20, 2008. This excellent program featured a number of experienced practitioners speaking on a broad array of estates and trusts topics.
Topics (and speakers) included:
- Family Law Update (Karon Bales)
- Shareholder Issues – The Family Business in Succession Planning (Frank Archibald)
- Dealing with Insolvent and Bankrupt Estates (Barry Corbin and Robert Klotz)
- The Non-Resident Factor in Estate Planning (Mary Anne Bueschkens and M. Elena Hoffstein)
- Update on the Trust and Estate Provisions in the Protocol to the Canada/U.S. Income Tax Treaty (Beth Webel and Jim Yager)
- New Strategies for Post-Mortem Tax Planning – The Eligible Dividend Rules and More (Heather Evans)
- Powers of Attorney and the Duty to Account – An Update (Liza Sheard)
- Powers of Appointment (Timothy Youdan)
- The Will is Not the Whole Picture – Integrating the Transfer of Wealth both Inside and Outside the Estate (Wendy Templeton)
- New Developments in Insurance and Estate Planning (Graham Carter)
- Update on Practice Directions for the Estates List (The Honourable Mr. Justice David M. Brown)
- Capacity and Other Issues in Power of Attorney and Guardianship Disputes (Jan Goddard)
- A Clinician’s Perspective on Assessing Testamentary Capacity and Related Capacities (Dr. Kenneth Shulman)
- Capacity Issues – The Perspective of the Hospital, Retirement Home and Group Home (Wendy Griesdorf)
- The Vulnerability of Pre-Death Gifts (Eric Hoffstein)
- The Scope of the Attorney’s Powers (Sender Tator)
- The Incapable Minor Turning 18 (Clare Burns)
- Remarks from the New Children’s Lawyer for the Province of Ontario (Debra Stephens)
- Marshalling the Evidence For and Against Capacity in a Will Challenge (Hilary Laidlaw)
- Short Circuiting the Frivolous Will Challenge (Hull and Hull’s Craig Vander Zee)
- Mediation of Capacity Issues – The Mediator’s Perspective (Felice Kirsh and Archie Rabinowitz)
If you were not able to attend, the seminar materials will be available from the Law Society of Upper Canada.
Thank you for reading,
I recently read an article regarding the most common claims against lawyers, which is authored by Dan Pinnington who is the director of practicePro, LawPro’s risk and practice management program (click here for the article). I found it particularly interesting that only a small portion of LawPro claims account for a lawyer’s inability to know or apply the substantive law.
The most common claim involves communication between lawyer and client. Dan breaks down the type of communication errors into three categories. According to the article, the most common communication related error, is the failure to follow the client’s instructions. The second type of communication error is the lawyer doing work or taking steps on a matter, but failing to obtain the client’s consent or to inform the client. The third type of communication error involves the failure to explain to the client simple administrative things (i.e. timing of steps on the matter, fees and disbursement). Dan states that you can reduce your exposure to this type of claim by managing your client’s expectations from the very start of the matter and actively communicating with the client at all stages of the matter.
The second most common claim is missed deadlines and time management related errors. The most common time-related error is a failure to know or to ascertain a deadline (i.e. limitation period). There is a concern that procrastination-related errors are on an upwards trend. Dan states that these types of errors are easily preventable with better time management skills and the proper use of tickler systems.
The third most common error is the inadequate investigation or discovery of facts. To avoid these types of claims lawyers have to “dig deeper”, take the time to read between the lines so that all of the appropriate issues and concerns associated with the subject matter can be identified.
I hope my final blog will assist all of us in our practise.
Upon the death of a person, a duty arises to bury or otherwise dispose of the remains in a decent and dignified fashion. But who does this duty fall upon?
It is well established in the jurisprudence for Ontario that plans for the service and burial arrangements are the responsibility of the estate trustee. This responsibility can conflict with the wishes and expectations of the deceased and family members, particularly in a religious context.
In Saleh v. Reichert, the deceased was of the Muslim faith. Her husband had converted to the Muslim faith for the purpose of there marriage. There was evidence indicating that the deceased expressed her wish to be cremated upon her death. The deceased’s husband was appointed as the estate trustee without a will and intended to honour the deceased’s wishes. The deceased’s father objected to the cremation on religious grounds.
The court affirmed the fundamental duty of an estate trustee is to ensure that the remains of a body be disposed of in a decent and dignified fashion. The court held that religious law has no bearing on the case. In Ontario, burial and cremation are both means that would meet the requirement for disposal in a decent and dignified fashion. The deceased’s father’s action was dismissed.
It is important to note that it was acknowledged that there is no property in a body. Therefore, any instructions left by the deceased, whether in a Will or otherwise are only precatory and are not binding on the estate trustee.
I recently attended a breakfast seminar hosted by Hull & Hull LLP, where I listened to my colleague, Natalia Angelini, speak about a testator’s capacity to give instructions for the preparation of a Will.
During Natalia’s discussion, she spoke about the varying levels of capacity for different transactions. Natalia also touched on the traditional grounds that a Will could be challenged. I was particularly intrigued to learn that the circumstances surrounding the failure of a testator to make a will could be advanced as forming the basis for a will challenge.
One of the traditional grounds for a will challenge is undue influence. At its very basic form, undue influence occurs as a result of pressure brought to bear on the testator in giving instructions and executing the testamentary document. The pressure brought on the testator, must be of such a degree that the testator has reached the point of thinking, "It is not my wish, but I must do it".
In contrast, "reverse" undue influence (as it has been called) occurs where a testator is being prevented from signing a Will.
As this interesting topic continues to evolve, I am confident that the estate & trust bar will be looking on with interest.
You may remember that my colleague, Chris Graham, blogged on the death of the actor, Heath Ledger and the pending litigation involving his estate (Link to Chris Graham’s Blog).
It has been well reported that Ledger last made a Will in 2003, before the birth of his daughter Matilda (in 2005) and before his claim to fame. Under the 2003 Will, Ledger left all of his possessions to his parents and sister. He subsequently stared in several hit films which vastly increased the size of his net value. Subsequent to his passing, the question that was considered was what would happen to Matilda, as she was not provided for in the 2003 Will?
There had been discussion that Matilda’s mother would likely commence a claim on Ledger’s estate, which could have tied up the Estate in litigation for years. However, now it is widely reported that Ledger’s entire estate will all go to two year old Matilda (click here for the report).
Estate planning is like doing our taxes. No one wants to do them, but Ledger’s story teaches us an important lesson. It reminds us of the uncertainty of death and the consequential need to ensure that our estate plans are updated to protect those that we care for.
Today’s blog is a continuation of my blogs this week on the variation of a trust under the Variation of Trusts Act and will focus on the Deed of Arrangement.
The approach to, and content of, the Deed of Arrangement will most certainly depend on the circumstances involved. The approach to the Deed of Arrangement may be quite different if the variation arises as a result of an ongoing proceeding (and has been negotiated as part of that proceeding conditional on Court approval) than if it does not.
Pursuant to Section 3 of the Substitute Decision Act, the court may direct the PGT to arrange for legal representation for a person whose capacity is in issue in a proceeding under the SDA. The SDA further states that the person so represented shall be deemed to have capacity to retain and instruct counsel. However, section 3 counsel’s position and role remains somewhat murky. In Banton v. Banton, the court considered the import of an incapable person being deemed capable to retain and instruct counsel.
The court recognized that the position of section 3 counsel is “potentially one of considerable difficulty”. However, the court did not believe that section 3 counsel was in the position of a litigation guardian with authority to make decisions in the incapable person’s interest. According to the court, counsel must take instructions from his/her client and “must not act if satisfied that capacity to give instructions is lacking”. A very high degree of professionalism may be required in borderline cases where it is possible the incapable person’s wishes may be in conflict with his/her best interests and counsel’s duty to the court. The phrase offers precious little guidance to section 3 counsel, but does sound a cautionary note. In the circumstances, perhaps the best advice is for section 3 counsel to fully explain the situation to the court and ask the court’s advice and direction.
Finally, as an aside, the Ontario Government has now introduced legislation that would allow people to apologize with impunity. In other words, an apology will not be held against you in court. The hope is that “The Apology Act” will go a long way to defusing a contentious situation before litigation results. Sorry may, in fact, go a long way.
As always, thanks for reading.
Here’s a story from Calgary that will make every lawyer tremble documenting the conviction of a mother of three, and assistant at a law firm, for misappropriating $1.4 million from the firm’s trust account.
A great reminder of the need to restrict access to a trust account and exercise vigilance in who can access it. Of course, in the hustle and bustle of practice it is possible for these types of basics to fall to the background as we try to satisfy clients with the outcomes of their cases.
Most lawyers I know operate on the assumption that everything which leaves their office, including trust cheques, is their responsibility. Since not everything in every case can always be reviewed, that implies a certain amount of trust towards assistants, clerks, and other support staff. It also implies that it is very wise to know the people that work for you, and consciously keep up with them from time to time.
Nothing will protect from every rogue of course, but you never know what you might find out by staying on top of things…
Thanks for reading.
Listen to Deductions from Compensation.
This week on Hull on Estates and Succession Planning, Ian and Suzana finish up the discussion on the question of accounting by reviewing deductions from compensation and briefly sum up the procedure of the passing of accounts.