B.C. to Allow Electronic Wills and Remote Witnessing of Wills

The Wills, Estates and Amendment Act, 2020 will significantly change how a person may make a will in British Columbia, effective December 1, 2021.

Previously, a will had to meet all of the following requirements in order to be valid in British Columbia:

  1. It had to be in writing;
  2. It had to be signed at the end by the will-maker, or the signature at the end had be acknowledged by the will-maker as his or hers, in the presence of two or more witnesses present at the same time, and
  3. It had to be signed by two or more of the witnesses in the presence of the will-maker.

The amendments will allow for the execution of electronic wills, which are wills that:

  1. Are recorded or stored electronically, which means in a digital or other intangible form by electronic, magnetic, or optical means or by any other similar means;
  2. Can be read by a person; and
  3. Are capable of being reproduced in a visible form.

This means that as of December 1, 2021, a person can prepare and electronically sign a will, with no physical paper copy having to exist.  The amendments allow for the use of an electronic signature, and for the execution of the will to be witnessed electronically (i.e. remotely, by video).

In order to amend an electronic will, a new will must be made.

The amendments reflect some of the temporary measures implemented during the Covid-19 pandemic by way of ministerial orders, to allow for remote execution of wills. According to the Canadian Bar Association (B.C. Branch), these new changes are intended to respond to concerns raised by the public and the legal profession about a lack of flexibility in the rules regarding wills.

These changes certainly will provide greater flexibility and ability to the public to make wills, both during and outside of a pandemic.  However, as electronic wills become more common, problems may arise.

The possible existence of an electronic will creates uncertainty as to what document is actually the last will of a deceased person. Is there a more recent will stored on the deceased’s phone, tablet or laptop? Is there a document found somewhere in the deceased’s email inbox or in the cloud? Hopefully one of the witnesses to an electronic will would come forward and notify others of the existence of the document, but this may not always happen.   Moving forward, what will the expectation be on personal representatives or others to conduct searches of the deceased’s electronic devices, email inboxes, etc… for possible electronic wills?

We currently have a voluntary wills registry in B.C., which allows a will-maker to register a record of where to find the original copy of their will upon death. When dealing with an electronic will, there is no original physical copy of the document. In any event, the registry is not mandatory. This may create further uncertainty, especially when there is a physical will registered with the wills registry, but the possibility of a subsequent electronic will somewhere in the digital world that has not been registered.

If you choose to make an electronic will, you should at minimum make clear to the named executor that the document exists, and where it can be found (and ideally provide them with a copy).

Repost: B.C. Court upholds $1.4M bequest to SPCA

My colleague, Georgia Barnard, (bio found here) posted on our firm blog about a recent estate litigation case.  The post can be found here.

In Henderson v. Myler 2012 BCSC 1649 (reasons for judgment found here), the B.C. Supreme Court considered whether a handwritten note was effective and changed the distribution of an estate as set out in a prior will.  The prior will provided that the SPCA would receive the residue of the estate (approximately $1.4 million).  The note provided that the SPCA would only receive $100,000.  The Court concluded that the note was not effective, and so the SPCA received the $1.4 million residue pursuant to the prior will.

A CBC news article on this decision can be found here.

As Georgia notes in her post, it is important to immediately prepare a new will or codicil if your wishes for your estate change.

B.C. Case Comment: Court Admits Unsigned Will After Will-Maker Dies Before Signing Document

It is not uncommon for people to make changes to their estate plan in the final stages of their life, whether they are ill or elderly.  Sometimes there is urgency – death may be imminent.  On occasion, someone may start to make these changes, but may die before the changes have been finalized.  What happens when it is known that someone wants to make certain changes to their estate plan, starts the process to make those changes, but does not complete the changes (for example by taking the final step of signing a new will)?

This was the case in the recent B.C. Supreme Court decision of Bishop Estate v. Sheardown 2021 BCSC 1571. In Bishop Estate, the deceased had given instructions to a lawyer to prepare her will, she reviewed the draft will, and she made a few minor clarifications.  All that remained was to have the will signed and witnessed.  Unfortunately, as a result of the COVID-19 pandemic, the deceased cancelled her appointment with her lawyer to execute her new will.  She then died without ever signing her new will.

The deceased had a previous will, which named her now-deceased husband as beneficiary, or in the alternative the Kelowna General Hospital Foundation.  Under the new, unsigned will, the primary beneficiaries were the deceased’s nephew and niece-in-law.

A will must meet certain requirements to be valid, including the requirement that the will be in writing, signed by the will-maker in the presence of at least two witnesses.

However, in B.C. a court may cure deficiencies in an otherwise invalid will, and order it to be effective.  It must be established that the invalid document is (1) authentic, and (2) represents the deceased’s deliberate or fixed and final intentions regarding the disposal of her property upon death.  This is a fact specific inquiry.  I have previously discussed other cases that apply the test here.

In Bishop Estate, the Court considered the background as to why the the deceased was making changes to her estate plan in 2020.  Since the prior will was made in 2014, the deceased’s husband had died, and her nephew and his wife (the new beneficiaries) had moved to Kamloops and had become a regular part of her life.  The deceased gave detailed and specific instructions to her lawyer that she wanted to name her nephew and his wife as beneficiaries and remove the Kelowna General Hospital Foundation.

The Court concluded that the unsigned will represented the deceased’s fixed and final intentions.  The Deceased cancelled her appointment with her lawyer to sign her will because she could not leave her care facility and attend at the lawyer’s office in person as a result of the pandemic.  The Hospital Foundation argued that the deceased could have signed her will remotely, which will-makers were allowed to do as a result of the COVID-19 pandemic.  They argued that the deceased did not proceed with this option because she may have changed her mind about making a new will.  The Court did not accept this argument.  There was no evidence that the deceased was aware of this option, and the failure to execute the will remotely did not undermine her new testamentary intentions.

The Court ordered that the unsigned will was fully effective and determined how the deceased’s estate would be distributed.

What Happens in B.C. when Spouses die Simultaneously?

Unfortunately, it is not uncommon for spouses (or other family members) to die in a “common disaster” or tragedy, in which they die at the same time or in circumstances that make it uncertain which of them survived the other. One spouse may also survive the other, but then die mere days later (perhaps from injuries caused by the “common disaster”). If the two spouses have different estate plans, then the question arises: how are each of the estates to be distributed? This may be an issue when dealing with multiple marriages and blended families, where perhaps each spouse has left all or part of their individual estate to the other spouse and their own children, but not to their stepchildren. This arises not just with respect to their wills, but also with respect to jointly registered property, which carries with it a right of survivorship.

Fortunately, the Wills, Estates and Succession Act (“WESA”) simplifies this issue in British Columbia.

WESA provides that if two or more persons die at the same time or in circumstances that make it uncertain which of them survived the other, unless a contrary intention appears in an instrument, rights to property must be determined as if each had survived the other. If two or more persons held property as joint tenants, then unless a contrary intention appears in an instrument, for the purpose of determining rights to property, each person is deemed to have held the property or joint account as tenants in common with the other or with each of the others.

WESA goes one step further: a person who does not survive a deceased person by five days, or a longer period provided in an instrument, is conclusively deemed to have died before the deceased person for all purposes affecting the estate of the deceased person. If two persons hold property as joint tenants, or hold a joint account, and it cannot be established that one of them survived the other by five days, then one half of the property passes as if one person survived the other person by five days, and one half of the property passes as if the other person had survived the first person by five days.  Under the wording of WESA, the five-day survival requirement cannot be shortened in a will, but it can be extended.

As a result, in these circumstances each person’s assets (or their “half” of joint property) forms part of their estate and will be distributed as per their estate plan.

The above provisions do not apply to certain insurance monies, which are dealt with under the Insurance Act. For example, unless a contract or declaration provides otherwise, if the person whose life is insured and a beneficiary die at the same time or in circumstances rendering it uncertain which of them survived the other, the insurance money is payable as if the beneficiary had predeceased the person whose life is insured.

Family of Deceased Fights $1.5M bequest to the SPCA

A woman in Vancouver is contesting a bequest made in her great-aunt’s will in favor of the SPCA. A recent CBC story on the lawsuit can be found here: https://www.cbc.ca/news/canada/british-columbia/vancouver-family-heading-to-court-in-1-5m-inheritance-fight-with-spca-1.5803925

The deceased left the residue of her estate to the SPCA. The estate includes a valuable home in the Point Grey neighborhood of Vancouver. As a result of skyrocketing property values, it is estimated that the SPCA stands to receive approximately $1.5M from the estate.

The plaintiff is not the spouse or child of the deceased, so she does not have standing to vary the will. Instead, she wants to have a handwritten note composed by the deceased on her 99th birthday (in 2017) admitted to probate as reflecting the true final testamentary intentions of the deceased. The note purports to limit the amount of any gift to the SPCA to $100,000.

Section 58 of the Wills, Estates and Succession Act [“WESA”] allows the court to admit to probate a document or record that does not meet the technical requirements of a will. I have discussed this section in other posts, including one found here. This section would permit a handwritten note to be fully effective as though it had been made as part of the will.

In this case, the handwritten note is unsigned, undated and unwitnessed, and the deceased did not take any steps in the three years after writing the note to change her will to make it consistent with the note, so it will be interesting to see if it meets the test under s. 58 of WESA. The SPCA has also raised concerns about the deceased’s testamentary capacity when the note was written. If she had lacked capacity at the time, the handwritten note would not be effective as a testamentary instrument.

The plaintiff says that the SPCA is “greedy” for attempting to enforce the terms of the will, while the SPCA has called this a “challenging situation” for all parties.  The trial is set for January 2021.  However, as most estate litigation claims are settled in advance of trial through mediation and negotiation to avoid the expense and uncertainty of proceeding to trial, we may never know the final result.

Separation revokes a testamentary gift to a spouse, unless there is good evidence of a contrary intention

Subject to a contrary intention appearing in your will, a gift to your spouse made in your will is automatically revoked upon a separation (Section 56(2) of the Wills, Estates and Succession Act S.B.C. 2009, c. 13 (“WESA“)).

If you still wish to benefit your ex-spouse in your will (it does happen!), then you should update your will post-separation to make clear that you intend to make a gift to them despite the separation.

But what if you are named as a beneficiary in your ex-spouse’s will that was made prior to your separation? What if your ex-spouse wasn’t aware that a separation revokes a gift to a spouse, your spouse mistakenly believed that the gift to you in their will was still valid, and you have evidence that your spouse wanted to continue to benefit you upon their death despite your separation?

A will, or a part of a will can be revived under s. 57 of WESA. This may be done by an order under s. 58 of WESA, which allows the court to order that a record or document be fully effective as though it had made as the will or part of the will of a deceased person or order the revival of a will of the deceased person. I have previously written about s. 58 here. In effect, this section allows a document that does not meet the technical requirements of a will to be fully effective as if it was the deceased’s will. It also may allow a part of a will that has been revoked to be revived and be included as part of the will.

This is what happened in the recent case of Jacobson Estate (Re) 2020 BCSC 1280. The deceased made a will in 2014 which provided that her common law spouse was to receive the residue of her estate. In 2017 she separated from her spouse. She never made a new will.  The issue was whether her ex-spouse was entitled to the residue of the deceased’s estate.

The evidence before the B.C. Supreme Court was that the deceased spoke with her lawyer, and was adamant that her spouse was to still receive her estate as per her will, despite the fact that they separated. The deceased was not aware of s. 56(2) of WESA and the fact that her separation revoked the gift in her will to her spouse. The court held that had she been aware of this, she would have prepared a new will or codicil to ensure the gifts to her spouse were effective.

The deceased repeatedly and unequivocally stated to her lawyer and a friend that she wanted her estate to go to her spouse despite her separation. The court held that the will, including the gifts to the spouse constituted a “document”, which could be given effect as the will of the Deceased, even though parts of it had been technically revoked by the separation. The deceased believed the gifts to her spouse were still valid, and it was her testamentary intention to make those gifts. As a result, the entire will, including the clauses which gifted to her spouse, was admitted to probate.

It is important to consider the effect of a separation on the validity of the terms of your will (including your choice of executor) and take the necessary steps to update your estate plan as your circumstances change. In Jacobson, the judge observed that “it is hard to imagine how the deceased’s testamentary intention could be established more clearly than it is on the evidence before me,” and the court was able to recognize and uphold the deceased’s intentions.  This evidence may not always be available, and you may unintentionally disinherit someone that you intended to benefit under your will.

Undue Influence may be Presumed in Certain Circumstances

The term “undue influence” often brings to mind overt acts of elder abuse, where a gift is the result of influence expressly used by the recipient (the “donee”) to obtain that gift.

However, the law recognizes a second class of transactions which may be set aside on grounds of undue influence: where the relations between the donor and donee have at or shortly before the execution of the gift been such as to raise a presumption that the donee had influence over the donor. There are certain relationships with the potential for dominance and dependence,  and if you receive a gift in those circumstances it is presumed that it was procured by undue influence unless proved otherwise.

This second class of undue influence does not depend upon proof of reprehensible conduct. The person receiving the gift may have acted honestly and without ulterior motive. The person may honestly say that the gift was a completely unexpected and unsolicited. However, the courts will intervene as a matter of public policy to prevent the potential for influence that exists in certain relationships from being abused.

As a result, you may receive an unsolicited gift from a vulnerable person, and find that you are placed in the unfortunate position of having to rebut a presumption that you received the gift as a result of influence that you potentially could have exercised over the donor.

The court will first examine the relationship between the donor and donee. Is the nature of the relationship such that the potential for domination exists?

This presumption as it pertains to undue influence in the drafting of a Will can now be found in the Wills, Estates and Succession Act [SBC 2009] Chapter 13. The Act provides that where a person establishes that someone was in a position where the potential for dependence or domination of a will-maker was present, the party seeking to defend the Will has the onus of establishing that the person in that position did not exercise undue influence over the will.

If a relationship of dependency exists, the court will next consider the nature of the transaction. In situations where the donee does not provide consideration (i.e. gifts or bequests), it is enough to establish the existence of a dominant relationship.

Once a plaintiff shows that the relationship between the donor and donee was such that the potential for influence exists, and the transfer is gratuitous, the onus moves to the defendant to rebut the presumption of undue influence. The donee must establish on a balance of probabilities that the donor entered into the transaction of his own “full, free and informed thought”. The defendant may show no actual influence was deployed in the particular transaction (such that the presumption is rebutted), or the donor had no independent legal advice.

A gratuitous transfer from an elderly parent to an adult child does not automatically result in a presumption of undue influence. However, if a parent is vulnerable through age, illness, cognitive decline or heavy reliance on the adult child, the presumption may arise.

A presumption of undue influence may also arise in circumstances where a where a donee is intimately involved with the management of the donor’s assets. However, as discussed in a previous post found here, simply assisting a loved one will not necessarily trigger the presumption.

Undue Influence, or Simply a Caring and Involved Loved One?

We are often contacted by clients who feel very strongly that a loved one, usually a parent or spouse, has been unduly influenced to make an estate plan that does not reflect their actual intentions.  For example, a person may be unduly influenced in the making of their will, a transfer of property into joint ownership, or a large gift made during the person’s lifetime. Undue influence is a serious allegation, and there is a high threshold to establish it.

Undue influence certainly does happen. Elder abuse unfortunately happens. However, some clients’ concerns of undue influence arise simply from the fact that the alleged influencer was heavily involved in the life of the person alleged to have been influenced.

Consider the example of a mother and her children. As the mother ages, she requires more assistance. Perhaps she is no longer able to drive or has other mobility issues or physical limitations. It is not unusual for one child to step up and provide more assistance than the other siblings. This sibling may live closer to her mother, or her work schedule and other obligations may offer more flexibility such that she is able to provide a greater level of assistance. This assistance may include taking her mother to doctors’ appointments, or to the bank (where some bank accounts are transferred into joint names?), or to meetings with lawyers (where some changes are made to the mother’s will?). It will certainly mean that this child will have more face time with her mother than her siblings.

When the more-involved child ends up receiving greater benefits during the mother’s lifetime, or a larger share of the estate after the mother’s death, the other siblings may look back at all the time that their sister spent with their mother, and in some cases they will speculate or assume that their sister was influencing their mother. It is not uncommon for disappointed beneficiaries to look for some explanation for perceived unequal treatment or favoritism.

Stewart v. McLean 2010 BCSC 64 is a case that I always keep in mind as an example of conduct that does not reach the level of undue influence. In that case, the Court observed as follows:

[108]   In general, the plaintiff’s allegations of undue influence are unfounded suspicions and are based on an unfair view of the relationship between Donald and their mother. At best, the plaintiff’s case is that Donald, by his presence in Victoria, his driving his mother to appointments, his working around her house, his visiting her frequently, and his receiving a benefit from his mother leads to the conclusion that he unduly influenced her.

And after observing that objectively viewed this was a loving and caring mother-son relationship in which the son did what most mothers would expect:

[110]    There is no evidence that Donald dominated the Deceased. In fact, all of the evidence is to the contrary. The evidence consistently establishes that the Deceased was competent, “sharp”, and independent until her death. Certainly when it came to financial matters, she exercised a mind of her own. While she may have depended somewhat on Donald and his family due to her physical limitations, given her financial and intellectual independence, she could have made alternate arrangements.

Other cases have made similar observations. Some people require assistance in being mobile, and a family member is a logical person to provide this assistance. There must be something more to establish undue influence.

Knives Out: How Might Estate Litigation Matters Raised in the Film Have Played out in B.C.?

I recently had the opportunity to watch Knives Out, the 2019 murder-mystery film directed by Rian Johnson. This film was a delightful distraction, with a great ensemble cast and engaging plot. I highly recommend it.

It also touches on a number of estate litigation issues. Stuart Clark, a lawyer at Hull and Hull in Ontario, has authored an interesting discussion that can be found here: https://hullandhull.com/2020/01/knives-out/. I will discuss some additional issues which might have arisen had Mr. Thrombey resided in B.C.

WARNING – SPOILERS AHEAD!

Harlan Thrombey, a wealthy crime novelist, is found with his throat slit, the morning after his family attended his 85th birthday party at his mansion. As might be expected, his family is highly dysfunctional and Harlan has strained relationships with various family members, which include two adult children, a daughter-in-law (married to his deceased son) and various grandchildren. Harlan had recently threatened to cut one of his grandchildren out of his will. Everyone has a motive, and a detective (played by Daniel Craig) is hired to investigate the crime.

When the family gathers for the will reading (a typical storytelling device, but an event that I have yet to witness in real life), it is revealed that Harlan left his entire estate to his nurse, Marta.  He did not make any provision for his children, daughter-in-law, or grandchildren.

The family take various steps to secure Harlan’s fortune, including trying to convince Marta to renounce her inheritance, threatening to expose Marta’s mother as an undocumented immigrant, and threatening to implicate Marta in Harlan’s death. None of these efforts are successful. The mystery is solved, and Marta receives Harlan’s estate.

Stuart Clark’s post identifies various estate litigation issues in the film, including the issue of undue influence – the situation where someone is forced or pressured into making a will (or some other transaction) that does not reflect their wishes, but reflects the interests of the person influencing the vulnerable person.   A will procured by undue influence can be set aside as invalid.

In B.C., the Wills, Estates and Succession Act provides that where a person was in a position where the potential for dependence or domination of the will-maker was present, the party seeking to defend the will has the onus of establishing that the person in that position did not exercise undue influence. Harlan’s disinherited family members would likely argue that Marta, as Harlan’s full time nurse, was in a position of power such that the onus ought to be placed on her to prove that she did not exercise undue influence. If Marta is unable to meet this onus, then the will is invalid, and the prior will would likely be admitted to probate (assuming there are not any issues with the validity of that prior will).

If Marta is able to meet the onus and establish that the will was not procured by undue influence, that is not the end of the matter. In B.C., spouses and children can bring an action to vary a will if it does not make just and adequate provision for them. A wills variation claim would not be available to the daughter-in-law or the grandchildren. Only the two surviving adult children could make claims.

Wills variation claims are highly fact specific, and the court has discretion. In this case the relevant factors that the court would consider might include: (1) the strength of the relationships between the deceased and the various parties; (2) claims by adult independent children the most tenuous of wills variation claims; (3) Marta is not a family member; (4) the purported reasons for disinheritance of the children – whether they were valid and rational, (5) the estate is large, which favours making provision for everyone; (6) whether the deceased provided gifts or benefits to the parties during their lifetimes; and (7) the relative financial and other circumstances of the disinherited children and Marta.

Committees in BC – Orders Requiring Unwilling Adults Examined to Determine Capacity

In British Columbia, the Patients Property Act allows a person to apply to Court for a declaratory Order that another adult person is incapable of managing his or her affairs. Such incapacity may be due to mental infirmity arising from disease, age or otherwise, or disorder or disability of mind arising from the use of drugs. To succeed, the applicant must submit to the Court affidavits from two medical practitioners providing opinions that the person who is the subject of the application is incapable of managing his or her affairs.

If the Court is satisfied by the two affidavits and any other evidence, the applicant or someone else will be appointed “committee” to make decisions on behalf of the person, now referred to as the “patient”, concerning his or her financial and estate affairs or person or both. Also, a person   who has been subject to examination at a Provincial mental health facility or psychiatric unit may become a “patient” if the Director signs a Certificate of Incapability. For example, in Johnston Estate v. Johnston, 2019 BCSC 2149, the patient was willingly examined at a psychiatric unit and the Public Guardian and Trustee was appointed committee of his financial and legal affairs. When a committee is appointed, powers of attorney and representation agreements previously signed by the patient are suspended.

What If the Person Does Not Co-operate?

For many years it was accepted that the Patients Property Act did not give the Court jurisdiction to order a medical examination before two medical affidavits had been produced. In other words, if the proposed patient would not co-operate and agree to be examined, the applicant was out of luck. Then in 2012 the door was opened to ordering an adult person to attend for medical examinations for the purposes of the Patients Property Act in appropriate circumstances.

In Temoin v Martin, 2011 BCSC 1727, the Court addressed a situation where the elderly businessman who was the subject of the application refused to be examined by two medical practitioners and the applicant, his daughter, was unable to obtain the necessary affidavits. The daughter argued that there was an inadvertent gap in the legislative scheme, namely that there was no statutory means by which a court could compel an individual to undergo the necessary medical assessments to determine capacity. She relied on Supreme Court of Canada judgements saying the Court had inherent discretionary jurisdiction, which was not derived from a statute, to make orders to protect the interests of children and vulnerable adults.

The judge agreed that if there was prima facie proof of incompetence and a compelling need for protection the inherent jurisdiction would extend to ordering a person to attend for medical examination, but Temoin was not such a case. The Court of Appeal agreed: 2012 BCCA 250, pointing out that the starting point for such an application was the presumption of capacity of the person to be protected, the importance of the Charter values of liberty, autonomy, and equality, while emphasizing that the inherent jurisdiction must be used cautiously and only for the benefit of the person to be protected, and not for anyone else. The daughter’s motive of trying to gather evidence with which to attack her father’s recent estate planning was a relevant consideration when assessing her evidence. In cases of this kind, the applicant must present evidence establishing a serious question to be tried, both as to the capacity of the individual and his or her need for protection.

After Temoin, applications were made to compel unwilling adults to undergo mental capacity testing but none were successful until 2017 when the case of Singh (Re) became the first successful Temoin application: 2017 BCSC 984. In the Singh case, unlike in Temoin, the judge was satisfied that a medical opinion from the family doctor and evidence of questionable financial dealings raised serious questions as to both mental capacity and the need for protection, so the order was made.

So far, there have been no other reports of successful Temoin applications. Thus, while the door has opened to ordering an adult person to attend for medical examinations for the purposes of the Patients Property Act, it is not wide open. Nevertheless, Singh demonstrates that such orders are available if the applicant is able to present the right kind of evidence, even over the objections of the person to be protected and anyone else who opposes. Hopefully, this will provide helpful guidance for families struggling to deal with uncooperative or alienated loved ones who refuse the medical examinations needed so orders to protect them can be obtained.