Until Death Do Us Part? Estate Claims Arising Out
of Re-Partnerships: A Cross-Provincial Perspective
Co-Presented by Kimberly Whaley & Heather Hogan
Whaley Estate Litigation
CBA CLC – Newfoundland
August 15-17, 2014
CBA CLC 2014 NEWFOUNDLAND
Until Death Do Us Part? Estate Claims
Arising Out of Re-Partnerships: A CrossProvincial Perspective
Kimberly Whaley & Heather Hogan
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Introductory Comments: Societal Context
 Complexity in estate and trust planning: rising divorce
rate, second and third marriages or older adult cohabitations, recognition of same-sex partnerships, stepchildren, genetically procured children etc…….
 Increasing number of estate disputes arising from later
in life partnerships
 Volume of court cases with blended, fractured, complex
family units has exploded
 Rapidly aging population
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Societal Context
 Ageing Statistics:
 By 2036 there will 11 million seniors in Canada
 14% of our population is already over 65
 Life expectancy is at an all time high - age 83 for
women and 80 for men
 Dementia affects 20% of seniors by the age of 80, and
well over 40% by 90
 1 in 11 Canadians over the age of 65 currently has
Alzheimer's or related dementia
 In the US, Alzheimer’s is the 6th leading cause of
death with no cure
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Societal Context
 In Canada, changes and shifts as a result of :
 the increased prevalence of unmarried cohabiting
partners;
 equality of same-sex partnerships
 remarriages and re-partnerships
 children from multiple relationships, children, step
children adopted children and children procured
through genetic assistance with many parents
 all results in disputes between different factions of the
complex family connected to each other often only by
a deceased person
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Societal Context
 Rise of complex family:
 The 2011 Census - people choosing family structures
that create more complicated personal and legal
relationships
 2006 – 2011: common-law couples rose 13.9% to
nearly 3 million couples
 Increase for married couples was only 3.1%
 12.6% are stepfamilies with one or more children not
biologically related to one of the parents
 41% of stepfamilies are “complex” stepfamilies
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Litigation
Sampling of disputes that can arise after death:
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Intestate succession
Family Law Act elections/applications/division of property
common law spouse claims
enforcement of spousal support orders, domestic contracts
dependant’s support claims
unjust enrichment and its legal and equitable remedies
pension, beneficiary, and other designations
jointly held assets, accounts, real property
inter vivos transfers
revocation of Will on marriage (in some provinces)
claims by biological children and other “children”
predatory marriages and relationships for financial exploitation
OVERVIEW OF LITIGATION
A Cross-Provincial Review of Recent Cases
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Intestacy/Revocation Upon Marriage
 Historically, few rights for a surviving spouse
 Main protection: rule that marriage revoked a Will
 Could produce windfall for a surviving spouse:
Ontario, married person dies intestate, no issue,
spouse entitled to property absolutely
 Intestacy rules are strict
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Intestacy/Revocation Upon Marriage
 Not all Provinces:
 Alberta – Wills and Succession Act - February 2012 no Will or part of Will is revoked by marriage or testator
entering into independent relationship
 Fuchs v. Fuchs 2013 ABQB: Will declared valid after
marriage, even though no declaration that it was made
in contemplation of marriage
 Prior legislation applied re revocation of Will, however,
new legislative provisions on interpretation also applied
 Court: lack of declaration was due to misunderstanding
or error of his lawyer
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Intestacy/Revocation Upon Marriage
 British Columbia – Wills, Estates and
Succession Act, March 31, 2014
 Will is not presumed to be revoked by marriage or a
change in common-law or marriage-like relationships
 New Brunswick – hybrid approach
 Will revoked on marriage, subject to certain exceptions
 Person who would have received a gift under revoked
Will, can apply to court to receive gift
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Spousal Division of Property
 In most Canadian common-law jurisdictions,
married spouse entitled to division of property
following separation
 Upon the death of a spouse, in Ontario, within 6
months, a surviving spouse can:
 Make an election for an equalization application of
NFP under FLA; or
 Take under a Will (or under intestacy legislation if no
Will)
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Spousal Division of Property
British Columbia
 Division of property between spouses not triggered by
death of spouse
 Broad discretion to reallocate a deceased’s estate under
the Wills Variation Act
Alberta
 New legislation contains proposed to implement regime
for division of matrimonial property following death of
spouse
 Proposed changes to legislation, not proclaimed in force
yet (Attny. Gen. website states further research to be
conducted)
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Enforcement of Domestic Contracts
 Claims may be made for enforcement of spousal
support orders from previous marriages,
separation agreements with former spouses and
other domestic contracts
 Not enforceable: prohibited provisions, failure to
make full and final financial disclosure,
unconscionable
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Enforcement of Domestic Contracts
 McCain v. McCain 2012 ONSC 7344
 Son told to have his wife execute a domestic contract
or be disinherited by father
 Wife executed contract in which she waived all of her
property rights and right to equalization under the FLA
 In divorce proceedings wife argued that terms of
contract were “unconscionable”; she did not know
what she was giving up, she was vulnerable and
husband took advantage of her
 Court: Agreed it was unconscionable and offending
provisions were severed
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Enforcement of Domestic Contracts
 Caron v. Rowe 2013 ONSC
 Wife executed pre-marital agreement forfeiting her
right to family home
 Husband died intestate with no children
 Wife filed her election under FLA for equalization and
applied for declaration – sole intestate heir under
SLRA
 Mother of deceased sought interest in house, wife had
waived her right to it
 Court: Agreement not clearly drafted. Did not contract
out of right to home
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Enforcement of Domestic Contracts
 Yukon: MacNeil v. Hedmann 2014 YKSC 16
 Agreement to revoke a marriage contract had no legal
effect
 Husband unduly influenced wife to sign “revocation
agreement”:
 asked her to sign it ‘out of the blue’,
 threatened he would not pay her money owed unless she
signed it;
 witnessed by two sons who were high on marijuana at the
time
 Good overview of enforcement of domestic contracts
in Yukon
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Unjust Enrichment
 Kerr v. Baranow, Vanasse v. Sanguin 2011 SCC
 Reviewed and expanded remedies available to
unmarried spouses
 Recently Ontario court has expanded the analysis to
married spouses (Barrett v Barrett)
 Important for estate lawyers as u/e equally
applicable against estate of deceased spouse as a
living one
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Unjust Enrichment
 “Joint Family Venture”:
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Mutual effort of parties
Economic integration
Actual intent
Priority to the family or detrimental reliance
 Award not restricted to fees for service approach
 Remedy calculated on share of assets
proportionate to contribution
 Flexible approach
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Unjust Enrichment
 Barrett v. Barrett 2014 ONSC
 Court applied Joint Family Venture analysis for
question: Who benefited from the increase in
value of matrimonial home between date of
separation and date of trial?
 Court: It was specific intention of parties that
matrimonial home remain outside the joint family
venture
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Proprietary Estoppel
 British Columbia: Scholz v. Scholz 2013 BCCA
 Mother paid to build coach house on son and
daughter-in-law’s property
 Sold property (w/o mother’s knowledge) and refused
to share any proceeds of the sale
 Denied proprietary estoppel, resulting trust,
constructive trust but made finding of a family
relationship with an implicit agreement that mother
would receive fair measure of compensation
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Proprietary Estoppel
 Ontario: Schwark v. Cutting 2010 ONCA
 COA confirmed test for P/E:
 Owner of land induces claimant to believe
he or she will have a right to the land
 Claimant acts on this belief to his/her
detriment, with knowledge of owner
 Owner denies claimant expected right to
land
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Proprietary Estoppel
Clarke v. Johnson 2012 ONSC
 Clarke and his wife built a cottage on his wife’s
parents’ land
 Divorced but Clarke kept using cottage for 20 yrs until
ex-in-laws told him he had to stop
 Court: Successful on proprietary estoppel (and U/E)
 In-laws induced Clarke to believe he would have use
of land until he died; Clarke relied on this belief to
maintain
and
improve
cottage;
would
be
unconscionable to allow in-laws vacant possession for
their own use or to rent it out
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Dependant’s Support
 All Canadian provinces and territories have some
form of legislation dealing with dependant
support
 See CBA website for a Table of Concordance of
the legislation:
 http://www.cba.org/CBA/sections_wills/main/Tabl
es_2013.aspx
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Dependant’s Support
 Ontario: Part V of the SLRA - deceased, prior to
death, was providing support to a dependant but
failed to make adequate provision for proper
support of dependant on death
 Needs to prove provided support and failed to
provide adequate and proper support
 List of 19 factors to determine adequate support
 Not just legal but moral factors as well (Tataryn
v. Tataryn 1994 2 SCR 807 and Cummings v.
Cummings 2004 CanLII 9339 ONCA)
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Dependant’s Support
British Columbia – Wills Variation Act
 If a testator dies leaving a Will that does not
make adequate proper maintenance of testator’s
spouse or children, court has discretion to order
adequate, just and equitable provision out of the
estate for spouse or children
 Potentially broad application, no need to show
legal obligation to support or that the deceased
was supporting immediately prior to death
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Dependant’s Support
 Lalonde v. Moore 2013 ONSC
 Factors in establishing “spousal” relationship:
 location of applicant’s belongings;
 address on bank accounts;
 who paid household bills;
 declarations of common law living on CRA
filings;
 evidence of intimate, sexual or romantic
relationship
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Dependant’s Support
 British Columbia: Griese v. Syret 2013 BCSC
 Deceased had been in common-law relationship
for over 15 years when executed Will
 Left her “friend” (her husband) a dining room
suite
 Court: dining room suite not adequate support,
“modest spousal support” owed; but “significant”
moral obligation
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Dependant’s Support
 Alberta: Re Malkhassian Estate 2014 ABQB
 Deceased grandfather did not stand in place of a
parent to his granddaughter, granddaughter not a
dependant
 Court: grandparents should be free to provide
benevolent emotional support and childcare
without it affecting the ultimate disposition of his
or he estate
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Dependant’s Support
 PEI: MacDonald Estate 2014 PESC
 Dependants of a Deceased Person Act
 Second marriage, wife told she would be
beneficiary of a $100,000 life insurance instead
of being provided for under husband’s Will
 No life insurance existed
 Court: looked to intentions of parties and
awarded $100,000.00 lump sum support award
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Pensions
 Carrigan v. Quinn 2012 ONCA
 Who receives the pension death benefit when
the member of a pension plan dies and is
survived by both a common-law spouse and a
legally married spouse from whom he was
separated and was designated beneficiary?
 Court concluded: common-law spouse denied
benefit if only separated from married spouse
and not divorced
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Pensions
 But note different outcome in Vladescu v. CTV
Globemedia Inc. 2013 ONCA
 Dealt with Federal legislation: Pension Benefits
Standards Act
 Deceased entered into separation agreement that
explicitly gave former spouse his pre-retirement death
benefit as part of negotiated agreement
 Court: Agreement was insufficiently clear. Awarded
benefit to new wife
 Apparent harsh results – intentions/public policy
thwarted
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Pensions
 Saskatchewan: Love v. Love 2013 SKCA
 Deceased attempted to change beneficiary of
pension from ex-wife to son but improperly filled
out form and failed to sign it
 Court at first instance: ex-wife rightful beneficiary
 Court of Appeal: applied doctrine of rectification
 Looked to intentions of deceased
 Evidence showed son was intended beneficiary
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Pensions
 British Columbia: Wilson v. Wysoski 2014
BCSC
 Deceased and ex-wife executed separation
agreement / court order dismissed any claims
she had to pension
 Deceased committed suicide shortly thereafter,
did not change beneficiary
 Court: whether or not he intended to make a
change to the beneficiary he did not do so, exwife was proper beneficiary
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Pensions
 Nova Scotia: MacEachen v. Minniken 2014
NSSC
 3rd wife unsuccessfully challenged second wife’s
entitlement to pension benefit
 Deceased husband and 2nd wife had separation
agreement where wife agreed to execute
documents to release herself as beneficiary
 Husband never asked her to sign documents
 Court: 2nd wife valid beneficiary
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Joint Asset Challenges
 In re-partnership/re-marriages, expectant heirs
have incentive to prevent joint assets from
passing to surviving spouse
 This gives rise to challenges over jointly held
assets such as joint bank accounts and property
held in joint tenancy
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Joint Asset Challenges
 Jointly held bank accounts between deceased and
children particularly give rise to litigation, and
whether or not “right of survivorship” applies to the
accounts
 Pecore v. Pecore 2007 SCC: presumption of
resulting trust for bank accounts between parents
and adult children.
 Adult children must prove on balance of probability
that deceased intended to gift assets in joint account
 Absence proof, assets form part of the estate
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Joint Asset Challenges
 Sawdon Estate v. Watch Tower 2014 ONCA
 7 bank accounts held jointly with a right of
survivorship with 2 of 5 children
 Advised children, on his death to be divided equally
between all children
 In his Will, deceased left residue of estate to “Watch
Tower” and they argued bank accounts formed part
of the estate
 Court: children successfully rebutted presumption of
resulting trust
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Joint Asset Challenges
 Lowes Estate v Lowes 2014 ONSC
 Deceased and nephew joint bank account with instruction
that upon death money to go to university, granddaughter
and son
 Signed note to this effect
 Left wife residue of estate in Will
 Court: Relied on Sawdon – deceased set up trust with his
nephew as trustee
 University, granddaughter and son were beneficiaries.
 Onus to rebut presumption was met
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Joint Asset Challenges
 Severance of Joint Titles:Hanson v. Hanson
2012 ONCA 112 and Su v. Lam 2012 ONSC
 “Three rules”:
1) unilateral acting on one’s own share such as selling
or encumbering it;
2) mutual agreement between co-owners to sever j/t;
and
3) any course of dealing sufficient to intimate that the
interests of all were mutual treated as constituting a
tenancy in common
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Joint Asset Challenges
 Newfoundland: Chafe v. Hunter et al 2013 NLTD
 This case looked at the third “rule” and how it is
interpreted/applied in Newfoundland
 Court: joint tenancy was severed between father and 2
sons by their “course of dealing”
 Their actions included:
 Fencing off portions of land
 Building houses
 Cultivating gardens
 Harvesting hay
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Predatory Marriages
 Unscrupulous opportunists prey upon older adults for
financial gain
 Such unions are not easily challenged
 ‘Test’ or factors of assessment for determining requisite
capacity to marry at common law- a ‘simple’ test not
requiring high degree of intelligence
 Currently – minimal understanding of nature of contract
of marriage
 Common law considerations not kept pace with the
development of property legislation
 Statutory complications – SLRA
 Banton 1998, 164 D.L.R. (4th)
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Predatory Marriage
 Juzumas v. Baron 2012 ONSC
 89 year old older adult – 65 year old “caretaker”
 Older adult feared moving into assisted facility,
caretaker preyed on that fear
 Provided “care” in exchange for marriage and
promise never to put him in facility
 Day before wedding, visited lawyer and executed
Will
 Lawyer never met older adult alone
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Predatory Marriage
Juzumas …………………..
 After marriage – caretaker was abusive,
controlling and domineering
 Had older adult execute agreement to transfer
his home into the name of caretaker’s son
 Older adult’s neighbour explained the transfer to
him – older adult attempted to stop it but lawyer
told him it was already “in the computer”
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Predatory Marriage
Juzumas ……………..
 Justice Lang – cluster of remedies
 Presumption of undue influence: older person
and caretaker
 Doctrine of unconscionability – onus on
defendant to establish fairness of transaction
 Substantial costs in favour of older adult
 Unique as older adult himself brought action
(with help of neighbour)
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Predatory Marriage
 Other jurisdictions: New York: In the Matter of
Berk 2008
Similar facts to Juzumas – caretaker and older adult
Marriage kept secret until death of older adult
Caretaker sought statutory share of estate as “spouse”
Motion judge granted summary judgment motion –
caretaker awarded share as a “right”
 Appeal – trial of an issue – Did the caretaker forfeit her
statutory right of election?
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Predatory Marriage
 Campbell v. Thomas A.D. 3d 897 N.Y.S. 2d 460
 These cases highlight the potential of other rights
and remedies :
Other concepts:
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Doctrine of unconscionability
Tort of deceit
Equitable estoppel
Unfair advantage
What do we learn from this review of crossprovincial litigation?
 As professionals providing advice to clients in
estate, family and succession planning it is
important to consider:
 the complete family dynamics and full
knowledge of relationship and history
 if possible avoid appointment of a new spouse
or children of a former relationship where
there will be a temptation for the estate trustee
to not act neutrally
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 Necessary to identify all people who may make a claim
under the applicable dependant’s support legislation
 Advise client on adequacy of provisions in a proposed
Will and disposition of other assets based on the most
up-to-date trends in the cases
 Determine if the client had any former common-law
spouses, or spouses of sort, especially relationships that
ended without the involvement of lawyers, and status of
each
 Determine children and obligations to children of the
relationship(s) and ages and extended family
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 Determine what legislation might be operative
upon death and whether the deceased and his or
her partners are “spouses”:
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in family law
succession law
pension,
tax
banking, and other legislation
At common-law, a person is not limited to having only
one spouse at a time
 Also look at:
 Insurance policies
 Joint account holdings
 Title in real property
 RSP/RIF designations
 Designations of all property /assets
 Prior Wills/codicils
 Domestic agreements
 Corporate holdings and structures
 Succession planning
 Capacity planning / POAs
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 Important for separated spouses to obtain a
divorce, especially where the spouse has a
pension governed by legislation and whether it
coincides with the “plan”
 Also consider which legislation applies provincial
or federal, or any other legislation that is or may
be concurrently applicable
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 Existence and status of children is not always
obvious
 Special care ought to be taken to identify all
intended beneficiaries by name rather than class
as far as possible and to probe the existence and
lineage of children and other issue
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 Obtain copies of, and review, all domestic
agreements and any support orders
 Identify all insurance policies, RRSPs and other
similar vehicles with beneficiary designations
 Where a surviving spouse can make a claim for
a division of matrimonial property might need to
roughly calculate the potential outcome of a
property division between the spouses: evince
full and frank financial disclosure
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 Family lawyers have a major and inescapable
role to play in estate planning
 Separating clients may have outdated Wills,
property held in joint tenancy that should be
severed, and non-traditional assets (RRSPs,
insurance policies, pensions) that need special
care to ensure they fall into the right hands on
death
 Consider timing of advice and interim planning
pending divorce, etc.
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 If the client is in a common-law relationship,
whether the client and spouse are engaged in a
joint family venture with the potential for an
unjust enrichment claim, or other equitable claim,
against the estate
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Resources & Tools
 Consider also:
 Capacity requirements applicable to particular
planning decisions
 Red flags
 Undue influence
 See checklists:
http://whaleyestatelitigation.com/blog/checklistsfor-attorneys-and-guardians/
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THANK YOU
 Other resources:
 http://whaleyestatelitigation.com/blog/publishedpapers-and-books/
 THANK YOU 
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