Tag: Undue Influence
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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Canada’s population is rapidly aging. With baby boomers constituting just over one quarter of our population, the percentage of elders in our society is rising at an alarming rate. In 2014, the percentage of seniors north of 65 was 15.6 percent of the population. By 2030 – in the next decade – seniors will make up 23 percent of the Canadian population. With this change in demographics, elder abuse (and financial exploitation in particular) has become somewhat of an epidemic.
Financial exploitation commonly occurs when an attorney for property abuses his/her power afforded by the Power of Attorney (“POA”) document. Executing a POA is a vital component of every estate plan. When properly drafted and with the appropriate understanding of rights, duties and obligations, a POA has the effect of protecting individuals and their heirs against future incapacity. When drafted improperly and without a clear recognition of duties and responsibilities, the consequences can be grave.
Toronto resident, Christine Fisher (“Fisher”), is all too familiar with the devastating impact that POA abuse can have on an individual’s financial situation. In 2016, Fisher was 94 and living independently in her own apartment despite suffering from the beginning stages of Dementia. Fisher ultimately executed a POA appointing an old colleague, Theresa Gardiner (“Gardiner”), as her attorney for property. In her role as attorney, Gardiner immediately moved Fisher from her apartment to a seniors’ residence – a decision that was not viewed favourably by Fisher’s family and long-time friend, Nancy Lewis (“Lewis”). In the coming months, Lewis discovered that Gardiner had been abusing the power granted to her under the POA by misappropriating Fisher’s funds. By breaching her fiduciary duty, Gardiner exacerbated Fisher’s financial situation and improved her own. In an attempt to justify her misconduct, Gardiner told CBC News that Fisher had gifted her the money. In July of 2019, Gardiner was charged with several counts of theft. Most of these charges were withdrawn by the Crown in November of 2019.
Unfortunately, the story of Christine Fisher is not an anomaly. It is a reflection of society’s tendency to overlook and ignore vulnerable elders. Given the substantial risks associated with appointing an inappropriate attorney, lawyers should remain vigilant to possibilities of incapacity, fraud and undue influence prior to creating a POA for a client. Recognizing the warning signs is the first step to protecting this vulnerable population.
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Suzana Popovic-Montag & Tori Joseph
As we know, due to the COVID-19 pandemic, Ontario has passed emergency legislation allowing for Wills and powers of attorney to be executed and witnessed virtually, and in counterparts. This legislation will remain in effect for the duration of the declared emergency. Although Premier Doug Ford recently announced a plan for reopening Ontario, the timeline for doing so is still vague, and it’s unclear when the emergency will be declared to be at an end. Once the emergency is over, the normal rules for execution of Wills and powers of attorney, as set out in the Succession Law Reform Act, R.S.O. 1990, c. S.26, and the Substitute Decisions Act, 1992, S.O. 1992, c. 30, will once again govern how such documents may be validly executed.
Before coronavirus became such a pressing concern, there was some discussion in the United States, of allowing Wills executed electronically to be considered valid testamentary documents. According to this article in The New York Times, entitled “A Will Without Ink and Paper”, at the time the article was published in October 2019, some states already had laws to allow e-signatures on Wills, and others were looking to adopt similar laws this year.
In the US, the Uniform Law Commission has proposed the Uniform Electronic Wills Act, which is intended to serve as a model for states who wish to enact such legislation. The law would allow testators to complete the entire Will-making and execution process online, without a lawyer or notary present. There are already online services, currently serving states that already have laws allowing electronic Wills, which provide a platform for the creation of these digital Wills.
According to The New York Times article, the process of creating an electronic Will involves a testator creating a Will online, and then having a video-conference call with a notary. The notary will review the document, ask questions of the testator, notarize it, and send it back.
Although the concept of electronic Wills seems convenient, the costs may ultimately outweigh the benefits. As one lawyer quoted in the article states, signing a Will “is not like getting toilet paper delivered by Amazon instead of going to a supermarket…This is a solemn thing that people don’t do every day.” The “inconvenience” of consulting a lawyer, having a Will professionally drafted, and executed in the traditional way, will likely be worth the trouble for most testators, particularly when you consider that this is not a task that needs to be done repeatedly, at frequent intervals (like going to the grocery store to buy toilet paper).
The article mentions a number of points as to why electronic Wills may not be such a great idea. Without a lawyer’s involvement, there is a heightened risk for undue influence to go undetected. Testators with significant assets that may be structured in complicated ways, or who have unique family situations, such as a blended family, are not likely to be well-served by the creation (let alone the execution) of a Will online, without estate planning advice from a lawyer.
Desperate times call for desperate measures, and it is helpful to have alternate methods of executing Wills and powers of attorney in these unprecedented times. But when life goes back to normal, I think we can be comfortable with the return to the “old-fashioned” way of executing Wills and powers of attorney. Although some may consider the process to be cumbersome, the added protection for testators, and the comfort of an estate plan that takes into account each testator’s unique situation, is worth the price.
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Your sister (falsely) trash talks you to your mom. Mom then writes you out of her will.
“Fraudulent calumny!”, you scream.
Fraudulent calumny occurs where a person poisons the mind of a testator against another person who would otherwise be a natural beneficiary of the testator’s bounty by casting dishonest aspersions on his or her character.
The doctrine has been applied or considered in many UK decisions.
Fraudulent calumny is said to be a species of undue influence. However, rather than influence a testator to do something, the influencer influences a testator to NOT do something: leave a bequest to a certain party.
In order to establish fraudulent calumny, the person alleging fraudulent calumny must prove:
- That A made a false representation;
- To B, the testator;
- About C, a third person;
- For the purposes of inducing B to alter his or her testamentary dispositions;
- That A made the representations knowing them to be false, or reckless as to their truth; and
- That B’s will was made only because of the false representations.
See Kunicki& Anor v. Hayward,  4 WLR 32 at paragraph 122.
Like other undue influence, the test is a difficult one to pass.
In a recent UK decision, Rea v. Rea,  WTLR 1231, the court rejected a claim of fraudulent calumny. The court held that the challengers did not establish that their sister poisoned their mother’s mind against them, by saying that the challengers had abandoned her. The court found that the mother felt, of her own volition, that she was abandoned. Thus, whether it was true or not, the mother made her own decision without anyone “poisoning her mind”; therefore without fraudulent calumny or undue influence.
For a more artistic depiction of fraudulent calumny, see Boticelli’s Calumny of Apelles. The painting has been described as follows:
On the right of it sits a man with very large ears, almost like those of Midas, extending his hand to Slander while she is still at some distance from him. Near him, on one side, stand two women—Ignorance and Suspicion. On the other side, Slander is coming up, a woman beautiful beyond measure, but full of malignant passion and excitement, evincing as she does fury and wrath by carrying in her left hand a blazing torch and with the other dragging by the hair a young man who stretches out his hands to heaven and calls the gods to witness his innocence. She is conducted by a pale ugly man who has piercing eye and looks as if he had wasted away in long illness; he represents envy. There are two women in attendance to Slander, one is Fraud and the other Conspiracy. They are followed by a woman dressed in deep mourning, with black clothes all in tatters—she is Repentance. At all events, she is turning back with tears in her eyes and casting a stealthy glance, full of shame, at Truth, who is slowly approaching.
In R. v. Muvunga, defence counsel tried to use the painting as a visual prop, to be referred to as an allegory about false accusations. The court rejected the bid. “While the painting is of great interest to art historians and other scholars, I find that it has no place in a modern Canadian criminal trial.”
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This past weekend I had the great pleasure of seeing the movie Knives Out by Rian Johnson. For those of you who have not yet seen it I would highly recommend it, especially for those interested in estate law. Although I will try my best to avoid any significant spoilers for those who have not yet seen it, if you don’t want to know anything about the movie before seeing it you should stop reading this blog now.
The plot of Knives Out offers some interesting considerations for those interested in estate law, as it centers around the possible murder of the patriarch of an affluent family, with the alleged motive for many of those accused being that he was going to cut them off and write them out of his Will. While I was watching the movie I couldn’t help but analyze the cases of some of those accused, and whether there were estate law related options that would have been available to them that would not require them to commit murder (I promise that I am fun at parties and that this job has not ruined me).
Knives Out gets into a surprising amount of detail regarding certain estate law concepts, discussing such concepts as “undue influence” in relation to those who would have benefited from the new Will, as well as the “slayer rule” which would result in any individual who was involved in the murder not being entitled to receive a benefit from the estate for public policy reasons. The movie also gets into the concept of “testamentary capacity“, and whether the deceased would have had the capacity to draft the new Will which would have cut the various individuals off.
While watching the movie the one thing that kept running through my mind was that most of the accused family members would appear to have fairly strong arguments that they were dependants of the deceased even if they were cut out of his Will. The movie makes it fairly clear that the deceased was financially supporting a majority of his family members, with his threats to cut them off financially forming the foundation of the motivation for why they may or may not have killed him.
If the deceased had indeed cut these family members out of his Will, and this matter took place in Ontario, there would appear to be a fairly strong argument that those family members that were cut out of the Will were dependants of the deceased under Part V of the Succession Law Reform Act, insofar as the deceased was providing support to them immediately prior to his death and he did not make adequate provision for them in his Will. If these family members were found to be dependants of the deceased, the court could make an order providing for their support from the deceased’s estate regardless of whether they were left anything in his Will. Although I will concede that a long and drawn out court case where various family members assert they are dependants of the deceased is probably a less interesting film than an Agatha Christie style murder-mystery, if Knives Out were real life it is unlikely that many of the family members would ultimately receive nothing from his estate (assuming, of course, they were not involved in his death).
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One way that dispositions such as a gift during one’s lifetime, or a Will, may be challenged is on the basis of undue influence. However, allegations of undue influence are often difficult to prove. Additionally, due to the nature of these types of allegations, which often call into question the character of the alleged influencer, they are taken seriously by the court. As a result, parties should be cautious in alleging undue influence, and should be virtually certain that they will be able to back up their claims.
A recent example of this was in the costs decision of Nimchick v Nimchick, 2019 ONSC 6653. A mother and daughter had claimed that their son/brother (“B”) had devised a plan to financially exploit his mother for the benefit of himself, his spouse, and his son, (“J”). The circumstances leading to this allegation involved the mother adding J’s name to a bank account belonging to the mother, for the purpose of paying for J’s student loans, with any excess going to B. The trial judge dismissed the mother and daughter’s claim, finding that the mother intended to gift the money to B and J, and that B had not exerted undue influence over his mother.
The defendants, who were wholly successful, sought their substantial indemnity costs, in the amount of approximately $147,000.00. The court noted that the defendants’ partial indemnity costs of the action were approximately $100,000.00.
In making its determination as to costs, the court considered the circumstances in which elevated costs are warranted, including where the unsuccessful party has engaged in reprehensible, scandalous, or outrageous behaviour that is worthy of sanction. The court found that the mother and daughter’s behaviour had been of this nature. This conclusion seemed to have largely been based on the court’s finding that the mother and daughter advanced baseless allegations of wrongdoing and failed to prove their claims of civil fraud and deceit. Overall, the court preferred B’s evidence to the evidence from the mother and daughter.
The court ultimately awarded costs to the defendants in the amount of $100,000.00. This amounted to the defendants’ partial indemnity costs, according to a note included in the decision. Accordingly, it does not appear that the award against the plaintiffs was necessarily on an elevated scale. The costs awarded were, however, $15,000.00 more than the amount submitted by the plaintiffs as being appropriate.
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Notoriously tough to prove is the allegation of a testator being unduly influenced to make a will. The burden of proof lies with the objector, and corroborating evidence is required to discharge the evidentiary obligation.
Notwithstanding the difficulty one faces to establish undue influence, it is frequently a ground of attack in will challenge cases, often coupled with an allegation of lack of testamentary capacity. In Kozak Estate (Re), it was rather unusually the sole ground of attack, and it was successful.
The facts in brief are that late in life the testator met and fell in love with a much younger woman, and soon after made real property transactions and two wills favoring her, with the latter will made in contemplation of marriage (which marriage never happened). The testator’s sister and beneficiary under a prior will challenged the wills on the ground of undue influence.
The Court reviewed the law on the question, and in so doing highlighted that circumstantial evidence can be used to establish undue influence, with the types of relevant circumstances including:
- the increasing isolation of the testator including a move from his home to a new city which increased the respondent’s control over him;
- the testator’s dependence on the respondent;
- substantial pre-death transfer of wealth from the testator to the respondent;
- the testator’s expressed yet apparently unfounded concerns that he was running out of money;
- the testator’s failure to provide a reason or an explanation for leaving his entire estate to the respondent and excluding family members who would expect to inherit; and
- documented statements that the testator was afraid of the respondent.
The Court viewed the evidence of the propounder as having many inconsistencies, contradictions and unbelievable elements. In consequence, it did not rely on her testimony at all. No such credibility problems arose respecting the evidence of the objector’s witnesses.
The Court went on to assess and conclude that the objector had established undue influence. Among the critical supportive findings was that the propounder used the promise of marriage to control and manipulate the testator into providing economic benefits to her. Further essential indicia of manipulation were the isolation of the testator from friends and family and a change in the testator’s personality.
Pursuing this avenue to invalidate a will is no easy feat, particularly without direct evidence. What does not come as a surprise to me, however, is that the outcome in this case largely hinged on the credibility findings of the witnesses.
Thanks for reading and have a great day,
Natalia R. Angelini
Some other blogs on the issue that may be of interest are:
I recently read this article from the New York Times, which discusses the Will of Harper Lee, author of “To Kill a Mockingbird”, as well as some of the events that occurred several years prior to Harper Lee’s death. Harper Lee died in 2016, at the age of 89. In the years leading up to her death, there was some question as to her capacity, and possible vulnerability to coercion or undue influence.
The New York Times article states that Ms. Lee had had a stroke in 2007 and also had severe vision and hearing problems. Ms. Lee resided in an assisted living facility before her death. The article also describes the position taken by counsel for Ms. Lee as part of a copyright dispute in 2013, where counsel stated that Ms. Lee had been taken advantage of and coerced into signing away her copyright because she was “an elderly woman with physical infirmities that made it difficult for her to read and see.”
A couple of years ago, in 2015, Ms. Lee published her second novel, “Go Set a Watchman”. It turned out that this novel had been an earlier draft of her extremely popular book, “To Kill a Mockingbird”, which is purported to have been discovered by Ms. Lee’s lawyer, Tonja Carter, in 2014. There was some controversy surrounding the publication of “Go Set a Watchman” on the basis that Ms. Lee had not actually consented to the manuscript being published, and may have been manipulated into doing so. The publication of a new book was particularly remarkable given that Ms. Lee had only ever published one book prior to “Go Set a Watchman”—namely, “To Kill a Mockingbird”, which was published in 1960. However, an investigation was performed, and a determination made that there had been no elder abuse of Ms. Lee.
After Ms. Lee’s death, her Will had not been made a matter of public record, as a result of the successful efforts by Ms. Carter (named in the Will as executor) to have the Will sealed on the basis that Ms. Lee, who was a very private person, would have wanted her Will to remain private. It was only unsealed recently after litigation by the New York Times, and after Ms. Lee’s estate withdrew its opposition to the Will being unsealed.
The Will was signed only 8 days before Ms. Lee’s death, and apparently directs that the bulk of her assets be transferred into a trust formed by Ms. Lee in 2011. Ms. Carter is one of the trustees of this trust. Further documents relating to the trust are not public, and accordingly, very few details are known about it.
Given the questions surrounding Ms. Lee’s potential vulnerability in the years leading up to her death, it will be interesting to see whether anything further develops in relation to her estate, or the trust which apparently will hold most of the assets of Ms. Lee’s estate.
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In the spirit of the holidays, today I thought I would write about a recent decision related to gifting. In Grosseth Estate v Grosseth, 2017 BCSC 2055, the British Columbia Supreme Court considered whether the presumptions of resulting trust and undue influence were applicable to various inter vivos gifts made by a deceased uncle to one of his nephews. Ultimately, the court concluded that both presumptions were rebutted, and the gifts were valid.
In Grosseth Estate, the deceased, Mort, left a Will providing that the residue of his estate was to be distributed equally amongst his 11 nieces and nephews. However, most of his estate had been gifted to one particular nephew, Brian, and his wife, Helen, prior to Mort’s death. This left only about $60,000.00 to be distributed in accordance with Mort’s Will. One of Mort’s other nephews, Myles, who was the executor of Mort’s estate, brought a claim against Brian and Helen following Mort’s death, seeking to have the money that had been gifted to them by Mort, returned to the estate.
About 10 years prior to Mort’s death, he moved from Alberta, where he had lived most of his life, to British Columbia, where he moved into Brian and Helen’s basement suite. Mort became a full participant in the family; he was included on family outings, attended family dinners every night, and became like a grandfather to Brian and Helen’s children.
For the first couple of years after Mort moved in, he gave Brian and Helen money each month, on an informal basis, as contribution to household costs. Around 2 years after Mort had been living with them, Brian and Helen had decided to purchase a commercial property for Helen’s chiropractic practice. Mort insisted on gifting $100,000.00 towards the purchase price, making it clear that he did not want anything in return. Following this payment, Mort did not make further contributions to the monthly household expenses. The court concluded that there was a tacit agreement amongst Mort, Brian, and Helen that Mort’s generous gift had cancelled any notion that further payments would be required. Several years later, Mort also gifted $57,000.00 to Brian and Helen to pay off the balance of their mortgage.
The court found that the nature of the relationship between Mort, Brian, and Helen gave rise to the presumption of resulting trust as well as the presumption of undue influence. However, both of these presumptions are rebuttable.
The court acknowledged that, with respect to undue influence, Mort did depend on Brian and Helen, but based on the evidence of a number of individuals, concluded that he remained independent and capable throughout. Accordingly, the presumption of undue influence was rebutted.
The presumption of resulting trust was also rebutted as the court was satisfied that Mort intended the transfers to be gifts motivated by “a natural and understandable gratitude to Brian and Helen for the happiness and comfort of his final years.”
It is not uncommon for this type of situation to come up. Where a deceased lived with one niece or nephew (or sibling), or where the niece/nephew/sibling is the primary caregiver prior to the deceased’s death, any gifting that was done in the context of this relationship may be vulnerable to challenge on the basis of resulting trust or undue influence. Unfortunately, in some instances, the relationship dynamics involved in these kinds of arrangements can result in suspect gifts or transfers. Transfers made without clear evidence of an intention to gift can also raise questions. In this case, the court did not find that there was any improper behaviour on the part of the giftees, did find evidence of an intention to gift, and the transfers were ultimately upheld.
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In the world of estate litigation, there is a tendency to view influence askance: to see all influence as being motivated by self-interest and as inevitably carrying the seeds of coercion or “undue influence.”
Of course, this can’t be the case. A society that cares for the vulnerable and the elderly will require that strangers or distant relatives step in on occasion to help someone in need, particularly where there is no immediate family member to assist. A balance must be struck in the law as it relates to undue influence between protecting the elderly and vulnerable while, at the same time, respecting the dignity of an individual to exercise his or her own decision-making even in the face of influence or persuasion.
The law of undue influence has evolved differently as it relates to inter vivos gifts, on the one hand, and Wills, on the other. A full discussion of the reasons for this goes way beyond the scope of a blog but one observation that can be made is the acceptance that the law has shown for an individual to assert testamentary freedom, even if that means benefitting someone who exercises power over them.
Commentators such as John Poyser have observed the various rationales behind the fact that the presumption of undue influence is inapplicable in the case of Wills. While the law in this area has evolved, one of the policies underlying the law recognizes what we observed above: society requires the young to help the old. While there must be boundaries put on any conduct that would amount to an abuse of this social reality, there must at the same time be a recognition that well-meaning people should not be dissuaded from providing assistance if to do so would automatically trigger a legal presumption that their actions amounted to coercion.
Thanks for reading,
David Morgan Smith