Tag: Will Challenge
Lessons from Neuberger Part 1: Does an interested person have an automatic right to proof in solemn form?
The Ontario Court of Appeal released not one, but two, decisions last week in relation to a Will Challenge proceeding. In addition to Spence v. BMO Trust Company, 2016 ONCA 196 (which is well covered by the media, and by our blog here), the Court of Appeal also released the decision of Neuberger v. York, 2016 ONCA 191.
The case of Neuberger v. York involves the Estate of Chaim Neuberger. The late Chaim Neuberger was a holocaust survivor, and Toronto real estate mogul, whose success equated to a fortune of over $100 million on his death according to the National Post. Chaim was predeceased by his wife, Sarah Neuberger, and he was survived by his daughters, Edie Neuberger, and Myra York, and the adult children of Edie and Myra. Edie and Myra were the named Estate Trustees of Chaim’s 2010 Wills, as well as his prior 2004 Wills.
Chaim passed away on September 25, 2012, and Edie brought an application to challenge the validity of Chaim’s 2010 Wills on December 19, 2013. In January, 2014, Edie’s son, Adam, also brought a motion to challenge the validity of Chaim’s 2010 Wills, amongst other relief. Edie’s Will Challenge was dismissed at first instance, along with Adam’s Will Challenge.
On appeal, Adam argued that an “interested person” is entitled, as of right, to have a Will proved in solemn form, prior to a grant of probate. Adam argued that this right stems from Rule 75.01 of the Rules of Civil Procedure, which reads as follows:
FORMAL PROOF OF TESTAMENTARY INSTRUMENT
75.01 An estate trustee or any person appearing to have a financial interest in an estate may make an application under rule 75.06 to have a testamentary instrument that is being put forward as the last will of the deceased proved in such manner as the court directs.
On this point, the unanimous Court of Appeal disagreed. The Hon. Justice Gillese considered a plain reading of Rule 75.01, in conjunction with Rule 75.06, and determined that an “interested person” may request proof in solemn form but cannot require it (at paragraph 84). Moreover, “the court has a discretion whether to order that a testamentary instrument be proved, as well as a discretion over the manner in which the instrument is proved” (at paragraph 87). The correct approach to Rule 75.06 requires an applicant, or moving party, to “adduce, or point to, some evidence which, if accepted, would call into question the validity of the testamentary instrument that is being propounded” (at paragraph 89).
Thanks for reading! Stay tuned this week for more lessons from Neuberger.
The Honourable Susan E. Greer has been involved in the world of estate law for many years, as both a lawyer and as a recently retired Superior Court Justice. During that time, and particularly during her 23 years as a Superior Court Justice, she has observed a number of changes as she observes in this article for Advocate Daily.
Some of the changes discussed by The Honourable Ms. Greer are relevant to the practice of law generally. In particular, she mentions civility, and the fact that counsel have become less courteous over time, including in interactions with court staff, each other, and witnesses. She also refers to the increasing use of emails as exhibits to affidavits. In this regard, of note is the concern that many emails are “sent in haste, without careful consideration as to how they read or how they could be misinterpreted” as opposed to the thought that usually goes into the drafting of letters. These comments are applicable to lawyers generally, not solely the estates bar, and are important points to consider.
Specifically with respect to estate law, The Honourable Ms. Greer notes that there have been changes in several areas, including sibling rivalry increasingly being brought to the courts, and increasingly heavy scrutiny of jointly held assets. One particularly interesting development discussed in the article is the increase in will challenges commenced by children prior to the death of their parent. As noted by The Honourable Ms. Greer, this is not an issue unique to Ontario or Canada, citing a French case in which the daughter of Liliane Bettencourt, heir to the L’Oreal cosmetics company, successfully challenged the validity of her mother’s will, while her mother was still alive.
Relevant to many of the changes that have been seen in estates, according to The Honourable Ms. Greer, is the issue that the “greed factor has become more pronounced, causing bitter divisions in families that seem impossible to heal.” That being said, given that courts have moved away from awarding all costs of litigation to be paid from the estate, the possibility of being responsible for one’s own costs, as well as the costs of other parties, may serve as a disincentive for potential litigants with more frivolous claims that may be driven by greed.
Thanks for reading.
A close relative dies. Although you are not named as the Estate Trustee in the will, you cooperate and assist the Estate Trustee to begin the process of seeing to the administration of the estate. Suddenly, you find new evidence which you believe questions whether the deceased had the requisite capacity to execute the Will, and you contemplate bringing a will challenge. But is it too late? Have your actions to date made it such that you are no longer able to challenge the validity of the will? As a result of the doctrine of estoppel by convention, the answer is maybe.
At its most simple, the doctrine of estoppel by convention can be thought of as the court concluding that as a result of an individual’s prior representations or conduct, that it would be unequitable and unjust to now allow them to advance a claim. In the context of a will challenge, the doctrine of estoppel by convention will most often be raised when, prior to an individual having commenced a will challenge, they assisted and/or were involved in the administration of the estate. The argument which is advanced is that as a result of their involvement in having seen to the administration of the estate up to a certain point, that it would be unjust and unequitable to now allow them to challenge the validity of the will.
In Leibel v. Leibel, Madam Justice Greer found that as a result of the conduct of the Deceased individual’s son following his mother’s death (including assisting to sell his mother’s house, and assisting in dividing up certain household and personal effects), that he was now estopped from challenging the validity of his mother’s will. In Leibel, Madam Justice Green employed the test adopted by the Supreme Court of Canada in Ryan v. Moore to determine whether to apply the doctrine of estoppel by convention, being:
- The parties’ dealings must have been based on a shared assumption of fact or law: estoppel requires manifest representation by statement or conduct creating a mutual assumption. Nevertheless, estoppel can arise out of silence (impliedly).
- A party must have conducted itself, i.e. acted, in reliance on such shared assumption, its actions resulting in a change of its legal position.
- It must also be unjust or unfair to allow one of the parties to resile or depart from the common assumption. The party seeking to establish estoppel therefore has to prove that detriment will be suffered if the other party is allowed to resile from the assumption since there has been a change from the presumed position.
In the event that all three elements of the test are found to apply, the court may apply the doctrine of estoppel by convention, and dismiss the will challenge.
An interesting decision was recently released from the Brampton Superior Court of Justice which considered whether the Court’s rectification of a will in a prior proceeding precludes the Court from requiring that same will to be proven in solemn form on a subsequent motion.
The details of the initial rectification proceeding in McLaughlin v. McLaughlin, 2014 ONSC 3161, have been extensively covered by our blog here and here (bonus points to our dedicated readership if you recall the comments of our very own Jonathon Kappy in the Law Times on this subject). Ultimately, Justice Lemon rectified the secondary will of Elizabeth Anne McLaughlin such that the revocation clause therein would not have the effect of nullifying the validity of the primary will that was executed on the same day, in addition to rectifying various other drafting errors. A finding was made after a full hearing that neither the testatrix, nor the drafting solicitor, could have failed to detect the patent errors in the secondary will if they read the will.
Despite the Applicant’s success in the rectification proceeding, the issue of his sibling’s Notice of Objection to the probate of the primary will remained before Justice Price in McLaughlin v. McLaughlin, 2015 ONSC 4230, and he was left to consider the preliminary issue of whether Justice Lemon’s prior ruling precluded the Court from requiring both wills to be proven in solemn form. Given that there were no issues with the testatrix’ testamentary capacity, the issue before Justice Price in respect of the validity of the secondary will was whether the testatrix understood and approved of its contents in light of the prior finding that she could not have read the secondary will on a balance of probabilities.
After a review of the jurisprudence on the doctrine of rectification in Robinson Estate v. Rondel, Justice Price concluded as follows,
“Rectification is concerned with correcting the drafting errors of the will, whereas the proving of a will in solemn form concerns the validity of the will. These issues are substantively different, and I am therefore satisfied that I would not, in effect, be reversing Lemon J.’s decision as to rectification of the secondary will should I find that will to be invalid.”
While Justice Price found that the Court was not precluded from considering the validity of the secondary will subsequent to its rectification, Justice Price ultimately found that the secondary will was invalid on the basis of Justice Lemon’s finding that the testatrix did not read the will nor did she have knowledge and approval of its contents.
The term "probate" recurs throughout estates practice as a noun, verb and adjective. The most common context refers to the process of getting a court to provide some sort of official certification or recognition that a testatmentary instrument is the Last Will of a deceased. In Ontario, the probate process results in the issuance of a Certificate of Appointment of Estate Trustee With a Will (or Without a Will).
Under the modern Rules of Civil Procedure, the procedure resulting in the issuance of a Certificate of Appointment rarely requires that a judge review the application, or even the alleged Will. By Rule 74.14, an application need be referred to a Judge only where, in the opinion of the Registrar, the application and the accompanying materials are not complete or contain information on which the Registrar has a doubt. This results in an efficient administrative process, but any interested party can challenge the validity of a such a probated Will, and the fact that a Will has been "probated" has no probative value when it comes to proving the Will in solemn form, as it is called.
A judgment upholding the validity of a Will does not necessarily "probate" that Will. Parties to the proceeding may not want a Certificate of Appointment to be issued, and so they will not request that a Certificate of Appointment be issued as part of the Judgment. This might be the case where the Will is a "corporate" or "secondary" will, and is restricted to assets that can pass outside of probate (often to avoid estates administration tax).
Have a great weekend,
Christopher M.B. Graham – Click here for more information on Chris Graham.
After a 5 month trial and 12 days of jury deliberations, Anthony D. Marshall was found guilty of 14 charges, including giving himself a pay-rise of $1 million for managing his mother’s finances. He faces a mandatory sentence from 1 to 25 years behind bars. His sentencing is set for December 8, 2009.
The attorney who did the estate planning for Mrs. Astor was also convicted of forgery charges. Click here to read David Smith’s blog on the attorney’s actions.
The prosecution argued that Mrs. Astor’s Alzheimer’s was advanced so far that she could not understand the complex changes to her 2004 Will or other financial decisions that benefitted her son, such as the $1 million salary.
The defence has argued that Mrs. Astor had lucid moments despite her Alzheimer’s and that she gave her only son control of her estate out of love.
The story does not end there. Mr. Marshall may appeal and the question of what will happen to Mrs. Astor’s $180 million estate has not been resolved. A civil case was postponed pending the resolution of the criminal charges against Mr. Marshall. Some of the charitable beneficiaries of the estate sent observers to the criminal trial and it are not clear how evidence it the criminal trial will impact the civil case.
Whichever Will is eventually probated, Mr. Marshall will receive a large portion of his late mother’s estate.
Diane A. Vieira – Click here for more information on Diane Vieira.
Listen to Tucker and Tucker Estate Will Challenge
This week on Hull on Estates Megan Connolly and Paul Trudelle discuss a decision that was released on January 21, 2009 on the Tucker and Tucker estate, involving a will challenge.
The sole issue was whether or not this particular will was valid.
Feel free to send us an email at firstname.lastname@example.org or leave us a comment on the Hull on Estates blog.
This week on Hull on Estates Natalia Angelini and Craig Vander Zee discuss the frivoulous will challenge from the perspective of how you might short-circuit it.
Feel free to send us an email at email@example.com or leave us a comment on the Hull on Estates blog.
Offers to settle and more specifically, Rule 49.10 of the Rules of Civil Procedure, are intended to force the parties in a legal proceeding to consider the settlement of a matter prior to trial failing which, costs consequences will result if an offer is more favourable than the result obtained at the trial.
In the general litigation context, the Ontario Court of Appeal has held that the Court should depart from the prima facie costs consequences in Rule 49.10 only where, after giving proper weight to the policy of the rule and the importance of a reasonable predictability and the even applicability of the rule, the interests of justice require departure.
The applicability of offers to settle and Rule 49 in a Will challenge context has been considered by Judges with different results. In the often quoted case of Olenchuk Estate, Re. the Court found, amongst other things, that it would seem somewhat incompatible with the nature of these proceedings to apply rules designed to encourage settlement of adversarial, contentious, proceedings and when there appears to be a reasonable question whether the deceased was mentally capable of making the Will that is propounded; it imposes an obligation on the Court to be satisfied that the Will was the product of a capable testator before putting on it the imprimatur of the Court. In Olenchuk, the Court further held that Rules designed to encourage settlement of contentious litigation can be applied in estate matters, but the difference between certain kinds of estate litigation and other forms of litigation can make it difficult to apply Rules of Civil Procedure to estate proceedings.
The Ontario Court of Appeal discussed the traditional approach and modern approach to awards of costs in estate litigation in its 2005 decision of McDougald Estate v. Gooderham. The Court found that the modern approach to fixing costs in estate litigation is to carefully scrutinize the litigation and, unless the Court finds that one or more of the public policy considerations, set out in its decision applies, to follow the costs rules that apply in civil litigation.
The Court of Appeal noted that “Gone are the days when the costs of all parties are so routinely ordered payable out of the estate that people perceive there is nothing to be lost in pursuing estate litigation.”
In a Will challenge, offers to settle, whether informal or formal can be an important tool in regard to the disposition of costs; perhaps more so in light of the approach for costs set out in McDougald v. Gooderham.
Enjoy the Holidays! Craig
Facing a frivolous Will challenge can be very frustrating, time consuming and costly.
In a typical Will challenge proceeding, the process can involve an application/motion for directions, documentary discovery from the parties and non parties, examination of the parties and non parties, interlocutory motions, mediation (informal or formal), expert reports, a pre-trial conference and a trial.
In the typical Will challenge, an order for directions can be the best tool a party has, at first instance, to manage a Will challenge. An order for directions allows a party to craft the manner in which a Will challenge may proceed and to seek the assistance of the court with obtaining interim and/or ancillary procedural relief to the Will challenge. The provisions included in an order for directions, may depend on, among other things, the issues and parties involved, the evidence to be marshalled, whether mediation is a requirement and, if not, how the evidence known, and/or to be obtained, might be utilized in the pursuit of settlement and the claim, and other relief in respect of the estate that may be necessary.
In the case, however, where the Will challenge is frivolous and the propounder of the Will wishes to short circuit the typical Will challenge process, consideration can be given to, among other things, a motion for summary judgment and/or security for costs. Such a motion can be a powerful tool in litigation in the appropriate circumstances.
An offer to settle can also be used to try and force an opposing party to resolve a frivolous Will challenge or face potentially substantial costs consequences if the proceeding is continued.
Enjoy the Holidays! Craig