Whaley Estate Litigation Blog

The Need to Plead

When are pleadings necessary in contested estate disputes? This was one of the questions dealt with in Notarfonzo Estate, 2013 ONSC 2496 (CanLII).

The Canadian deceased was survived by his wife and nine year old daughter in Cuba. In his previous Wills, the deceased named his wife and daughter as his beneficiaries. Just twelve days before he died of lung cancer in a palliative care unit, he made a new Will naming his brother as the sole beneficiary. He also transferred property to his brother during his lifetime.

The Children’s Lawyer started an application on behalf of the daughter. The application challenged the validity of the last Will, disputed the validity of the lifetime transfers to the brother, and claimed support for the dependant daughter.

At an earlier hearing, the court ordered the brother to disclose the deceased’s earlier Wills and information about the assets and liabilities of the estate. Some of this disclosure was provided. At this hearing, the Children’s Lawyer asked the court to order a trial of the issues in the application. The brother agreed that the court should order a trial, but also argued that the matter should be converted into an action with pleadings. The court agreed, and ordered the Children’s Lawyer to serve a Statement of Claim within 30 days. The Children’s Lawyer had resisted this order, arguing that it did not have enough information to frame the claims. The Court acknowledged that this was a concern, but found that, since the first round of disclosure had been delivered, the Applicant now had enough information to plead the daughter’s claims properly.

A case should proceed as an action, the court held, when findings of credibility are necessary or where live testimony is necessary. This was that kind of a case: there were key witnesses who interacted with the deceased. Their evidence would need to be weighed.

The Children’s Lawyer also asked for a tracing order and an interim preservation order. This request was dismissed, but without prejudice to renewing it later. The Court held that the previous order that the brother not dissipate the deceased’s assets would be good enough for the time being.

Finally, the Court ordered the estate trustee to pay $4,100.00 per year in interim dependant’s support to the daughter, which was in keeping with the deceased’s previous level of support.

You can read the case here: Notarfonzo Estate, 2013 ONSC 2496 (CanLII).

Posted in Case Commentary

Jewish Tribune: When is Disappointed Heir a Defrauded Creditor

Charles B. Wagner writes in the May 7th Jewish Tribune on the subject of Fraudulent Conveyances.

Excerpt:

As our regular readers already know, the B’nai Brith Canada Trust and Estates Group will be holding a seminar June 4, 2013 on Fraud and Estate Litigation. For the purposes of this column, I want to focus on how lawyers have used the Fraudulent Conveyances Act in the estates and powers of attorney context. While the Fraudulent Conveyances Act is most often used in an insolvency setting – helping the creditor to claw back assets the debtor has spirited away – it has also been used in estate litigation to stop the testator from gifting all of his assets away to defeat a spouse’s entitlement under the Family Law Act after the testator’s death. Debra Stephens of Goddard Gamage Stephens LLP and Kimberly Whaley of Whaley Estate Litigation will be addressing this fascinating subject as well as others in their paper When does Estate Planning cross the line and become a Fraudulent Preference?

Read the full article on the Jewish Tribune website

Posted in In the Media

Toronto Star: Ferraton v Shular: An Unfair Bargain Not to be Enforced

Recently, the Toronto Star published an article describing a story with a twist on the usual power of attorney (“POA”) induced situation of abuse.

A typical financial abuse scenario may consist of the following: an individual whose capacity is in question executes a POA document that enables a friend or relative to act on his or her behalf; the friend or relative uses said POA to sell the grantor’s home to his or her own benefit; as a result, the grantor is robbed of the security he or she would have had based on the equity in the home.

Star reporter Mark Weisleder describes a series of events involving a man with a history of mental illness who gave permission to his friend to fix and sell a property he owned in St-Catherines. The incentive? The friend would obtain 50% of the profits of sale.

These two individuals entered into a Sales Agreement according to which the proceeds of sale as well as the expenses incurred to sell or maintain the property would be divided in half.

The friend followed through, invested a modest sum of money in the property, and then asked the owner to provide her with a POA to enable her to sell the property. Once the property was sold and the owner had received the profits of sale, his friend expected to receive half of that amount. However, the owner had a change of heart and decided to provide her with only $20,000 for her efforts in addition to what monies she had invested in fixing the property.

Justice Wilson of the Ontario Superior Court of Justice, in reviewing this case, found that the Sales Agreement was invalid for two reasons: first, due to legislative provisions found in the Real Estate and Business Brokers Act 2002 and secondly, because the Sales Agreement was unconscionable and, as such, unenforceable.

This case differs from a “typical” abuse scenario in so far as it is the grantor of the POA who most benefited from the sale of the home. Nevertheless, this set of facts does resemble many cases of financial abuse in that it refers to a friend who, ostensibly, sought to take advantage of a person who was not in a mentally healthy state and, as a result, had a difficult time making decisions about his property.

Ferraton v Shular reminds us that courts may use the doctrine of unconscionability in determining contractual enforceability where indicia of vulnerability are found. Even if an agreement is made in writing, where there is unconscionability—uneven bargaining power and an improvident bargain—a contract may be set aside.

Link to the case on CanLii

Link to The Star article

Posted in In the Media

Elder Abuse Video in Oji-Cree, Pamphlets in Cree, Oji-Cree and Ojibwa

The Wawatay News Online reports that the Thunder Bay Police partnered with the Ministry of the Attorney General and Eabametoong’s Ma-Nee Chacaby to produce a public awareness video, available in both Oji-Cree and English, about recognizing and reporting elder abuse.

The videos are available on YouTube in Oji-Cree or English:

Direct link: http://www.youtube.com/watch?v=CH4WEnJoiBI

Direct link: http://www.youtube.com/watch?v=umyWn6TndZY

The Thunder Bay Police Service website provides more information on elder abuse, including the above videos and pamphlets in English, Oji-Cree, Ojibwa, and Cree: http://www.thunderbaypolice.ca/crime-prevention/safety-tips/elder-abuse

The Wawatay article is here: http://www.wawataynews.ca/archive/all/2013/5/2/elder-abuse-videos-launched-thunder-bay_24443

Posted in News

CBA’s Elder Law Conference: Hot Topics – Calgary Police Service’s Elder Abuse Response Team

This is the fifth installment of highlights from the Canadian Bar Association’s Elder Law Conference which was held in Toronto on April 15 & 16, 2013.

During the panel on National Police Perspectives on Elder Abuse, A/Sgt Graeme Smiley of the Calgary Police Service educated attendees about an innovative pilot project in Calgary that leverages the efforts of that City’s police services and social workers in their approaches to preventing and responding to elder abuse.

Calgary’s Elder Abuse Response Team (EART) brings together social workers, police officers, a nurse and a community development worker in a coordinated effort to provide older adults with focused investigative responses to reports of abuse, risk assessment, counselling, referrals, and where necessary, court orientation. A/Sgt Smiley reported particular success with EART’s approach to offender management.

A/Sgt Smiley shared with Whaley Estate Litigation a recent presentation about EART that he gave during National Victims of Crime week. Click to view this presentation

He also gave us a copy of EART’s digital story, as posted on YouTube, which encourages all of us as “gatekeepers” to ask questions and tell the appropriate service providers if we have concerns about elder abuse:

Direct link: http://www.youtube.com/watch?v=LhDJEpWJObA

Posted in News

Budget Update: Ontario to Review Carrigan Estate

The government of Ontario released its 2013 Ontario Budget on May 2. Among various proposed pension reform measures, it seems that government intends to review the Ontario Court of Appeal’s decision in Carrigan v. Carrigan Estate 2012 ONCA 736 and propose amendments to the Pension Benefits Act and regulations.

In Carrigan v. Carrigan Estate, the Court of Appeal considered section 48 of the Pension Benefits Act, R.S.O. 1990, c.P.8, which specifies when a pre-retirement death benefit will be paid out to a spouse. Under section 48(1) of the Act, a pre-retirement death benefit is payable to the plan member’s surviving spouse, overriding the plan member’s choice of designated beneficiary. However, the majority of the Court of Appeal interpreted the Act and held that, where a plan member has a common law spouse at the time of death and is separated but not divorced from a married spouse, then the provision is inapplicable and neither spouse receives the pre-retirement death benefit. In this case, the married but separated spouse ended up receiving the benefit because she was the designated beneficiary.

As we blogged on April 1, 2013, the Supreme Court of Canada denied leave to appeal.

The decision has drawn close attention from estates, pension, and family law professionals, as well as the media. As we noted in our April 1 blog, the Financial Services Commission of Ontario publicly supported the common-law spouse’s appeal to the Supreme Court of Canada. It now seems that the call has been taken up, not by the courts, but by the legislature.

We will keep a close eye out for developments on this issue at Queen’s Park.

Posted in News