Saskatchewan Estate Litigation Update: Vaudreuil v Madson, 2023 SKKB 19

The recent Saskatchewan King’s Bench decision in Vaudreuil v Madson is an example of a testamentary document in which a trial was required to determine its validity. This was because of contradictory evidence which had been adduced as to require findings of credibility at trial.

Factual background:

A brief summary of the factual background in Vaudreuil was as follows:

  1. Paul Shlahetka (“Deceased”) died on August 6, 2021, at 91 years of age. The Deceased had six siblings, all of whom predeceased him.  His sister, Annie, died in 2019. Annie had three daughters, Adeline McPhee, Ms. Vaudreuil, and Ms. Nehring.
  2. The applicant, Gloria Vaudreuil, and her sister, Irene Nehring (“Applicants”), were nieces of the Deceased. They filed a caveat against the Estate of Paul Shlahetka on August 12, 2021 preventing anything from being done in relation to the Estate. They suggested that the valid testamentary document for the Deceased was a Last Will and Testament dated May 7, 2014, prepared by the Tourney Law Office in Yorkton, Saskatchewan.
  3. In contrast, the respondents, Irvin Madson and Cynthia Madson (“Respondents”), contended that a handwritten document dated July 8, 2016 (“July 8 Document”) was the valid holographic last will and testament of the Deceased. The Respondents operated their own farm in the District of Springside. They were neighbours and friends of the Deceased.
Evidence of capacity in relation to the Deceased:
  1. There was contrasting evidence filed by the parties, in relation to the capacity of the Deceased, from 2015 onwards.
  2. The Court found, for example, that on or about February 9, 2015, the Deceased, while driving his car on a rural road near his home, hit the ditch, and became stuck in the snow. He was found by the RCMP who returned him to his home. The next day, the Deceased was driving his truck, ostensibly to retrieve his car, and again hit the ditch. He tried to dig himself out of the snow using his hands in -25-degree weather. The RCMP found him by his truck, disoriented and with his hands frostbitten by the cold. The RCMP took him to Yorkton Hospital where the Deceased was admitted for treatment.
  3. While in hospital, the Deceased remained disoriented to time, place and person. His attending family physician, Dr. Oduntan, identified that the Deceased had an extensive family history of dementia and a past history of confusion and memory loss in 2009, but that his memory loss in 2015 had become more significant.
  4. Oduntan performed three separate Mini-Mental State Examinations on the Deceased between February 10, 2015 and March 5, 2015. The Deceased scored very low on each one. He was diagnosed with advanced dementia and a certificate of incompetence was forwarded to the Public Guardian and Trustee.
  5. The Deceased was placed at Canora Gateway Lodge where he continued to reside until his death on August 6, 2021.
  6. On June 28, 2016, the Madsons removed the Deceased from the Gateway Lodge and took him to see a Yorkton lawyer. This lawyer indicated he thought the Deceased  had capacity to do a will, although the notes he made of this attendance appear to have been limited in scope.
  7. Apparently, on July 8, 2016 the Deceased remained concerned about re-doing his will. Mr. Madson took the Deceased  to his own home and sat him down at his kitchen table with a pen and a piece of paper. Mrs. Madson was not present.
  8. The Chambers Judge described what happened next, as follows:

53]     …Mr. Madson said, based on what [the Yorkton lawyer] had advised with respect to a holographic will, that he told Mr. Shlahetka to write down what he wanted and left him on his own for about 20 minutes. During that time, he said Mr. Shlahetka wrote down the first part of the July 8 Document. Mr. Madson averred Mr. Shlahetka then called him back, but when he looked at what Mr. Shlahetka had written Mr. Madson said he told him “it was not really a will but more of a power of attorney” and it “did not really say what was to be done with his estate after he died”. Mr. Madson averred he then left Mr. Shlahetka for a further 30 minutes “or so” during which time Mr. Shlahetka wrote out the second part of the July 8 Document. Mr. Madson averred that when Mr. Shlahetka called him back in, he said words to the effect “now take this and rub it under Gloria’s nose”. Mr. Madson further averred: “He knew that at this point that Gloria was trying to get guardianship over him and felt she was trying to get his property, and was very unhappy about that”. Mr. Madson averred that after doing the July 8 Document Mr. Shlahetka was very content and felt everything was looked after.

Issue:

A key issue in Vaudreuil was whether proof on solemn form was required to determine the validity of the July 8 Document.

Findings of the Court:

The Court held that solemn form was required. The Court held that the Applicants had adduced evidence, which if accepted at trial, would tend to negate the Deceased’s testamentary capacity at the time of the July 8 Document. The evidence on capacity was contradictory. Thus a trial, and the tools of cross-examination offered by trial, would better allow a trier of fact to truly determine which side’s evidence was more reliable.

The below findings of the Chambers Judge, taken from his decision, outline some of his factual conclusions:

[26] First, Mr. Shlahetka’s capacity remained in issue from and after his placement in Gateway Lodge in or about March 2015 to at least July 8, 2016, as well as after that date.

[27] Second, the affidavit evidence raises a serious issue as to Mr. Madson exerting undue influence over Mr. Shlahetka, including in his comments with respect to Mr. Shlahetka’s relationship with his nieces and nephew and more particularly regarding Ms. Vaudreuil’s motivation in seeking to manage Mr. Shlahetka’s affairs. Further, based on his own affidavit, it is apparent Mr. Madson coached Mr. Shlahetka in the preparation of the July 8 Document.

[35] The evidence regarding Mr. Shlahetka’s capacity is highly contradictory.

[69] As can be seen from the above examination of the evidence, there were significant conflicts regarding Mr. Shlahetka’s mental state at the time the July 8 Document was signed, his intentions, his relationship with his nieces and nephew, his relationship with the Madsons, the actions and role of Mr. Madson and the circumstances surrounding the making of the July 8 Document. These are not mere contradictions on immaterial issues. There are major conflicts in relation to material issues that could affect a determination of capacity and undue influence. Having regard for the summary of the affidavit evidence set out above, controversy remains on several critical matters in dispute, some of which overlap, and many of which will require an assessment of credibility by a trier of fact.

Conclusion:

Ultimately, the Chambers Judge made the following order:

  1. He directed a trial to prove the July 8 Document in solemn form to determine what portion, if any, of the July 8 Document expressed the testamentary intention of the Deceased;
  2. The issues to be determined at trial included (without limitation) the below:
  1. Whether the Deceased, at the time of the execution of the July 8 Document, had testamentary capacity; and
  2. Whether the Deceased, at the time of the execution of the July 8 Document was subject to undue influence.

Contacting a Lawyer on this Subject

James Steele’s preferred practise area is estate litigation, including will challenges, executor disputes, power of attorney issues, etc. Contact James Steele at 1-306-933-1338 or [email protected]. The above is for general information only, and not legal advice. Parties should always seek legal advice prior to taking action in specific situations.

Read more on our blog.

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Saskatchewan Estate Litigation Update: Kuffner v. Jacques, 2023 SKKB 14

The recent Saskatchewan King’s Bench decision in Kuffner v. Jacques offers guidance on when the merits of a will challenge can be decided in a summary fashion, as opposed to a full trial.

Factual background:

 

The factual background in Kuffner was as follows:

  1. The Will Challenge:

The deceased at issue was Phillip Eugene Jacques (“Deceased”). Mr. Jacques died on September 19, 2018, at the age of 88. Prior to his death, the Deceased executed wills dated May 28, 2012; October 10, 2013; October 21, 2013; and July 9, 2014.

The will dated July 9, 2014, was admitted to probate on December 6, 2019. The challenger, Jason Kuffner (“Challenger”) was one of eight step-grandchildren of the Deceased. The May 28, 2012 will provided for the Challenger to receive a larger share of the estate than the Challenger would receive under the later wills. The primary difference was that the 2012 will provided the Challenger with a specific bequest of land and farm equipment, while the subsequent wills provided him with a one-eighth share of a portion of the Deceased’s

The Challenger had applied for solemn form, and to revoke probate of the 2014 Will. Mr. Justice Megaw, in a judgment of May 6, 2019 (the “Megaw Judgment”), had concluded there was a genuine issue for trial as to whether the Deceased had testamentary capacity when he executed the will of July 9, 2014.

  1. Application for Summary judgment:

Before moving on with a description of the decision in Kuffner, some context is helpful. For will challenges in Saskatchewan, they typically follow a two stage process:

  1. Stage 1: First, there is a threshold Chambers hearing to determine if there is sufficient merit in the testamentary challenge to warrant a trial. This Chambers hearing will be simply conducted on affidavit and documentary evidence. In this case, the Stage 1 hearing was held before Justice Megaw, and resulted in a May 6, 2019 judgment that there was a genuine issue of capacity for trial; and
  2. Stage 2: Second, if the challenger is indeed found to have raised a genuine question affecting the will, a full trial involving vive voce testimony will then typically be held to determine the actual validity of the will. The trial is often preceded by the steps of document disclosure, sworn questioning, and a pre-trial conference.
Summary judgment is a procedure which is distinct from a trial. Summary judgment involves a court reviewing evidence which is primarily (or totally) in affidavit form (paper form). The evidence is thus not introduced through a succession of live witnesses, which is what occurs in trial, where each witness can be examined and cross-examined, to best evaluate credibility.

Here, in Kuffner v. Jacques, the Challenger did not wish to incur the full expense and delay of a trial to deal with the Stage 2 of the will challenge. The Challenger instead applied for what is called summary judgment, seeking (among other things) a declaration that the Deceased lacked testamentary capacity when he executed the wills dated October 10, 2013, October 21, 2013, and July 9, 2014. If the Court had in fact granted such summary judgment, that would produce the desired outcome for the Challenger – i.e. that the May 28, 2012 will would be the document admitted to probate.

Issue posed in Kuffner:

 

Much of Kuffner distilled to the below issue: whether summary judgment could appropriately decide whether the deceased, Phillip Eugene Jacques, lacked testamentary capacity when he executed wills dated October 10, 2013, October 21, 2013, and July 9, 2014.

Court ruling in Kuffner:

 

The Court, in a decision written by Mr. Justice Tochor, began by outlining the test which governs whether summary judgment should be employed:

18  A primary task in determining summary judgment applications is assessing whether there is a conflict in the evidence and, if so, whether that conflict can be resolved in some way short of conducting a trial.

Typically, a court will be most comfortable with summary judgment if it concludes that:

  1. The Court can use the summary judgment process to make the necessary findings of fact;
  2. The Court can use the summary judgment process to apply the law to the facts; and
  3. Summary judgment would be more expeditious and less expensive means to achieve a just result than going to trial.
Ultimately, the Court in Kuffner held that summary judgment was not appropriate in this case. In doing so, the Court essentially relied on two grounds.

First, the Court noted that Mr. Justice Megaw, in his prior judgment of May 6, 2019, had made an explicit finding that there was “genuine issue for trial as to whether Mr. Jacques had testamentary capacity when he executed the will of July 9, 2014.” Mr. Justice Tochor held that this prior order provided a reason why a trial should indeed occur.

The Challenger made the argument that Mr. Justice Megaw’s finding there is a “genuine issue for trial” could not be read to mean that Mr. Justice Megaw had found there was a “genuine issue requiringa trial”. However, Mr. Justice Tochor had a different perspective, and concluded:

31      I cannot accept the distinction Mr. Kuffner seeks to advance in this submission. I cannot conceive there is any material difference between “a genuine issue fortrial” and “a genuine issue requiringa trial”. The plain words used by Mr. Justice Megaw convey an unmistakable intention to order a trial to resolve whether Mr. Jacques had testamentary capacity. There cannot be any misunderstanding of Mr. Justice Megaw’s conclusion that a trial of this issue is required in these circumstances.

As an aside, this author has sympathy with the submission of the Challenger. The Challenger argued that an order that capacity raised a “genuine issue for trial” should not be automatically treated as an order that a full trial was definitively required to determine such genuine issue in Stage 2. Given the customary language found in the case law (case law which is often from a prior period of time, in which summary determinations were not accepted as widely as they are now), many courts will simply use the phrase “genuine issue required for trial” in their Stage 1 orders, without turning their minds to the possibility that a separate, future judge may be asked to invoke its summary judgment powers in Stage 2.

But leaving this aside, Mr. Justice Tochor went on to find that, even if he was in error in relying upon Justice Megaw’s ruling of May 6, 2019, to dismiss the Challenger’s application, Mr. Justice Tochor also consciously declined summary judgment for another reason. Put simply, he himself felt uncomfortable in making findings of credibility in the face of conflicting evidence, as it related to the Deceased’s capacity. For example, one conflict arose between:

  1. The evidence of the Challenger, who attested that he saw the Deceased to suffer dementia after suffering from a stroke in April 2013. The Challenger said that he saw the Deceased to be easily confused and his memory was poor, and was otherwise unable to drive alone or conduct his daily affairs;
  2. By contrast, the evidence of the Deceased’s lawyer and accountant, throughout the material times, found the Deceased to be clear of mind, and firm in his understanding of the testamentary changes he was making.

There was also conflicting medical evidence, as two medical professionals had reached different conclusions, on the degree of capacity that the Deceased would have held.

It should be noted, as an aside, that it is open to a judge to resolve conflicts in the evidence within the structure of the summary judgment process, even in the absence of viva voce  For example, parties can cross examine on affidavits. But it appears that Mr. Justice Tochor did not feel that such processes would, in this specific case, give him the comfort that he needed.

 

Conclusion:

 

Mr. Justice Tochor ultimately dismissed the Challenger’s application for summary judgment. Instead, he ordered that the Local Registrar should, in consultation with the parties, set the matter down for a pre-trial conference. A pre-trial conference is the next step before a trial, and such an order would thus keep the matter moving forward.

Costs of this application were ordered to be costs in the cause. This means that whomever won at the future trial, would receive a specific costs orders in relation to this specific application. Until the winner was known from the future trial, no costs for this application would be paid however.

The author sympathizes with the practical reasons which likely prompted the Challenger to seek summary judgment. A full trial takes much longer than summary judgment (sometimes years longer). A full trial also costs tens of thousands of dollars more in legal fees. This is because a trial requires extensive witness preparation, witness travel, lawyer travel, additional correspondence with the court and parties, and lawyer attendance for full days of trial, etc.

In this author’s experience, there have not been many reported instances of challengers attempting to use summary judgment, to avoid a full trial on Stage 2 of solemn form. The decision in Kuffner provides a sobering indication that it may be difficult for parties to obtain a summary determination in relation to Stage 2 of a will challenge. It ultimately remains a personal decision, for each judge to evaluate whether they feel that summary judgment can resolve conflicting evidence appropriately, on a unique application.

Contacting a Lawyer on this Subject

James Steele’s preferred practise area is estate litigation, including will challenges, executor disputes, power of attorney issues, etc. Contact James Steele at 1-306-933-1338 or [email protected]. The above is for general information only, and not legal advice. Parties should always seek legal advice prior to taking action in specific situations.

Read more on our blog.

The Saskatchewan Estate Law blog is dedicated to providing practical, real-world information on Estate Law issues that affect Saskatchewan residents. The blog is written by RS lawyer, James Steele, whose practice focuses on estate litigation.

Related News and Articles

James Steele presents to STEP Canada

James Steele presented on February 23, 2022, to STEP Canada, an internationally recognized body of trust and estate practitioners. James presented on the topic of contested estates, and how to navigate such disputes. Related News and Articles

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Saskatchewan Estate Litigation Update: Nagy v. Graves, 2022 CarswellSask 590, 2022 SKKB 257

The recent Saskatchewan Queen’s Bench decision in Nagy v. Graves reminds us that a Court will often remove executors who are guilty of extreme delay in administering an Estate.

Factual background:

The factual background in Nagy was as follows:

  1. Nine siblings of the Nagy family were engaged in a dispute respecting their mother’s estate;
  2. Their mother, Blanche Nagy, died some ten years before, on November 13, 2012;
  3. Of the nine children, Blanche named two children as her executors, Jo-Ann Graves and Dennis Nagy;
  4. The executors did not apply for letters probate in Blanche’s estate until February 2021, over eight years following the death of Blanche. Letters probate were issued April 16, 2021;
  5. In her Will, Blanche directed that her estate be divided equally among seven of her children: Jo-Ann Graves, Katherine Reid, Claudette Pachal, Kirk Nagy, Karen Nagy, Timothy Nagy and Mark Nagy;
  6. Blanche provided no gift to two sons: Dennis Nagy and David Nagy;
  7. All the children of Blanche except Timothy were still alive. Timothy died in 2017 without a will, spouse or child. This meant that under intestacy legislation, Timothy estate’s would go to his surviving siblings, who will each receive one-eighth of Timothy’s estate (including Timothy’s entitlement to a portion of Blanche’s estate).
Relief requested in Nagy:

In the application in Nagy, one of the beneficiaries, Karen, applied to have Dennis and Jo-Ann removed as executors. In their place, Karen sought that she herself be appointed as sole executrix of Blanche’s Will.

In support of her application, all of the remaining beneficiaries under Blanche’s Will (except Jo-Ann and Timothy), including Claudette, Mark, Kirk and Katherine) had signed a “Renunciation and Consent” that Karen be appointed as the executrix.

Notably, David, although he was not mentioned in Blanche’s Will, has also signed a “Renunciation and Consent,” ostensibly because, under Timothy’s intestacy, he will receive a portion of his mother’s estate;

Issue posed in Nagy:

The issue in Nagy was whether the executors, Dennis and Jo-Ann, had “failed to administer the estate in a reasonable and prudent manner” as to render their removal as in the best interests of the estate.

Court ruling in Nagy:

Power to remove executors:

We begin by surveying the power of the Court to remove an executor.

S. 14.1 of the Administration of Estates Act (“Act”) allows for the removal of executors. S. 14.1 reads as below:

14.1 Removal of executor or administrator
14.1(1) 
On the application of a person having an interest in the estate, the court may remove an executor or administrator if the court is satisfied that:

(a) the executor or administrator:

(i) has failed to comply with an order of the court;

(ii) refuses to administer or settle the estate;

(iii) has failed to administer the estate in a reasonable and prudent manner;

(iv) lacks capacity to act as an executor or administrator;

(v) has been convicted of an offence involving dishonesty; or

(vi) is an undischarged bankrupt; and

(b) the removal of the executor or administrator would be in the best interests of those persons interested in the estate.

The power of removal is also given to the Court under common law.

Should these executors be removed?

We turn next to the grounds on which the Court in Nagy held that these executors should be removed.

We turn next to the grounds on which the Court in Nagy held that these executors should be removed.

The Court in Nagy found that it was unreasonable for the executors to have waited 8 years to apply for probate. The Court noted that s. 14 of the Act provided in theory that executors should apply for probate within 60 days of the testator’s death:

9 …What can be gathered from these provisions is an executor who acts reasonably would ordinarily apply for letters probate within 60 days of the death of the testator. Dennis and Jo-Ann did not apply for letters probate for over eight years.

The Court held that the reasons offered by Jo-Ann for not applying for letters probate (or otherwise administering the estate), were not convincing. Some of these are set out below:

  1. First, Jo-Ann stated in her affidavit that she did not take “immediate steps” to administer her mother’s estate because she “was advised by a bank employee that due to the small amount of money in my mother’s bank account, I would not need to probate the Estate at all.” However, the Court held that Jo-Ann must have known that her mother owned land (indeed two quarter sections of land) at the time she died. This alone would require probate;
  2. Second, Jo-Ann stated in her affidavit that “none of my siblings were eager to finalize the estate until the matter was brought up in 2019.” The Court held that to justify one’s inattention as executrix because of an absence of a complaint from beneficiaries was not an appropriate excuse. Furthermore, by 2019 Blanche had been deceased for seven years, and from 2019 (when her siblings intervened), it took until April 2021 to overcome Jo-Ann’s inertia and finally obtain letters of probate.

Ultimately, the Court found that the delay in applying for letters probate, or to act on any other estate matters, was contrary to the statutory expectation that an executor should apply for letters probate within 60 days of a deceased’s death. 

The Court also noted the position of the other beneficiaries, influenced the Court’s decision to remove the executors:

25      If the overarching responsibility of an executor is to safeguard the deceased’s estate for the well-being of the beneficiaries, then the voices of the beneficiaries should be heard. In this instance all the beneficiaries of the estate, except Jo-Ann, are of one mind: they want Jo-Ann and Dennis removed as executors and, in their stead, they want Karen to be appointed executrix. Notably, even David, who received no gift under his mother’s Will (but who will pro-rata share his deceased brother’s (Timothy) share of his mother’s estate) has also consented to Karen’s appointment.

The final issue considered by the Court was whether to change executors in mid-stream, given that the estate was nearing completion.  Before the date of the application, the executors had already sold the two quarter sections of farmland for good prices and distributed $308,000.00 of the estate funds to the beneficiaries.

While nearness to completion would sometimes be a purely practical reason to grudgingly keep poorly performing executors in office, the Court, in this instance, held that the executors should still be removed. The Court reasoned that the executors’ prior lack of diligence boded poorly for the remaining steps required in this estate (such as a final accounting, filing of taxes etc.).

The Court wrote as follows:

35      In this instance, the court finds that Dennis and Jo-Ann have shown a past and unexplained lack of diligence in administering their mother’s estate — the absence of probate for eight and one-half years, the lack of estate record keeping, an accounting that offers little more than rounded approximations of expenses without receipts or invoices, the failure to file estate income tax returns, an apparent and unaccounted benefit to Dennis who lived in the estate property for several years — these all show a dereliction of duty one expects of an executor.

36      I accept that the emphasis in this application should be on the future administration of Blanche’s estate and the risks to which it will be exposed if Dennis and Jo-Ann continue to administer the estate. Removal is not to punish them for past misconduct but rather to protect the assets of the estate and the interests of the beneficiaries. However, past misconduct that is likely to continue will often be sufficient to justify removal: Radford v Wilkins, 2008 CanLII 45548 (Ont Sup Ct).

..

38      Finally, the court is concerned with the future administration of the estate, particularly providing the beneficiaries with a full estate accounting, the filing of estate income tax returns and the potential liability for income tax liability. The consequences of unpaid taxes — liability, interest and penalties — may potentially encroach on what would otherwise have been available to the beneficiaries. To date Dennis and Jo-Ann have not provided any assurance to the beneficiaries that estate income tax returns will be filed. Upon whom — the beneficiaries or the executors — should potential liability for unpaid estate taxes fall?

[emphasis added]

Conclusion:

The Courts will generally not lightly interfere with the express wishes of a deceased person as to who should administer their estate. However, as Nagy shows, the Court will often remove executors in situations of extreme delay. Here, the Court removed Dennis and Jo-Ann as executors of Blanche’s estate.

Situations of 8-year delays in obtaining probate are not common. Many instances of delay in obtaining probate are closer to 1-3 years. It remains an individualistic (and thus less predictable) decision as to whether a judge will remove an appointed executor in situations of less extreme delay. In most such cases, a beneficiary would be well advised to consult a lawyer, to start the clock ticking by placing a demand on the executor, and threatening a court remedy if probate is not obtained. Most often, such demands will prompt the executors to act before the necessity of an actual hearing before the court is required. If no action is forthcoming, however, a beneficiary would be advised to consult a lawyer as to whether they should actually apply for a formal court order against the executors.

Costs order in Nagy:

The costs order in Nagy bears passing comment. The Court also ordered that costs of $2,500.00 shall be paid to Karen, jointly and severally, out of the estate share to be received by Dennis and Jo-Ann. This author has not seen the specific cost relief which was initially sought by Karen in terms of her notice of application.

However, one wonders if it would have been more equitable to award full indemnity (dollar of dollar) costs in favour of Karen so that Karen was not out of pocket. Courts routinely award costs on a full indemnity scale to a person who has taken a necessary court step required to advance the estate. Such, one other alternate costs order in the circumstances of Nagy could have been that Karen receives her entire full indemnity legal fees:

  1. With $2,500 to specifically come from the share of the estate given to Dennis and Jo-Ann; and
  2. The rest of the costs ordered to come from Blanche’s estate.

The above-proposed costs order would ensure that Dennis and Jo-Ann bore some of the responsibility for their own misconduct and delay but that the overall estate made sure that Karen was not out of pocket for taking a step that did not benefit her alone but instead benefited the entire estate. Part of the practical grounds for this can be illustrated by envisioning a future estate in which the executors have behaved poorly and need removal. If someone like Karen is expected to “step up” and hire a lawyer in such separate future estates, the incentive to do so would be lessened if that person had to bear a large portion of the legal fees of the court application personally. This results in a windfall for the other estate beneficiaries, who benefit from such a court order but do not have their estate shares diluted to bear their portion of the legal cost. It also reduces the chance that any one beneficiary “steps up” at all in the first place.

Contacting a Lawyer on this Subject

James Steele’s preferred practise area is estate litigation, including will challenges, executor disputes, power of attorney issues, etc. Contact James Steele at 1-306-933-1338 or [email protected]. The above is for general information only, and not legal advice. Parties should always seek legal advice prior to taking action in specific situations.

Read more on our blog.

The Saskatchewan Estate Law blog is dedicated to providing practical, real-world information on Estate Law issues that affect Saskatchewan residents. The blog is written by RS lawyer, James Steele, whose practice focuses on estate litigation.

Related News and Articles

James Steele presents to STEP Canada

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Saskatchewan Estate Litigation Update: Bell v Bell, 2022 SKQB 198

The recent Saskatchewan Queen’s Bench decision in Bell v Bell, 2022 SKQB 198 is an example of a Will challenge which did not succeed in raising a genuine issue for trial.

Bell reminds us that Courts will generally require firsthand evidence of incapacity or of coercion before the Court will subject a Will to the expense and delay of trial. If Courts consider the challenger’s evidence to be more circumstantial or unrelated in time to the specific signing of the Will, the Courts may find that there is no genuine issue.

Factual background:

The factual background in Bell can be summarized as follows:

  1. This will challenge was in relation to the Estate of Laurette Josephine Bell;
  2. On January 8, 2020, at the age of 86, Laurette executed a will (“Will”). After her death, one of her sons, Wayne, wished to have the Will proven in solemn form. Solemn form refers to the process of proving the validity of a Will through actual firsthand evidence in a trial process;
  3. In the Will, Laurette named two of her sons, Donald Bell and Grant Bell, as joint executors. The Will made two specific bequests and then proceeds to instruct that the rest of Laurette’s estate was to be divided equally among her children for their own use absolutely;
  4. Immediately following that bequest, however, the Will provided that Laurette’s son, Wayne, the applicant, was “not to receive anything from my estate nor any of his issue”;
  5. Laurette subsequently died on August 18, 2021, at the age of 88;
  6. Wayne sought to challenge the validity of Laurette’s Will and alleged that Laurette had been subjected to undue influence and/or had lacked capacity at the time the Will was executed;
  7. In Saskatchewan law, a will challenge requires a two-stage process. In the first stage, the challenger must first show that there “is a genuine issue to be tried.” That is, the applicant must generally offer evidence that, if accepted at trial, would tend to negate testamentary capacity or establish undue influence. Only if this genuine issue is raised at the first stage will a trial process (second stage) be legally required to actually determine credibility and make final rulings on whether the specific will is valid.
  8. In relation to testamentary capacity, Wayne suggested that a genuine issue was raised by the cumulative effect of the below factors:
  1. Laurette was elderly (87 years old at the time the Will was executed);
  2. Laurette had been forgetful and confused, as allegedly evidenced by her erroneous insistence that a historical loan to Dawn (the daughter of Wayne) remained outstanding (when Wayne alleged, and it did appear on the available evidence, that said the loan had been paid already years earlier); and
  3. That Laurette was forgetting names and had gotten lost in the mall on one occasion.
  1. In relation to the issue of alleged undue influence exercised on Laurette, Wayne alleged that Grant, Don and Garth (other sons of Laurette) were communicating disparaging and false statements to Laurette about Wayne and Dawn. Wayne essentially suggested that such poisoning had caused Laurette’s free will to be overburdened to the point that cutting Wayne out of the Will was not Laurette’s own voluntary act.
Issue:

The issue, as in most will challenges, was whether or not the challenger had raised a genuine issue requiring a trial (in relation to either capacity or coercion).

Court ruling in Bell:

The Court ultimately held that Wayne had not raised a genuine issue.

First, on the issue of capacity, the Court held:

  1. The fact that Laurette was 87 years of age was not enough to raise a genuine issue. The Court held that some 87‑year‑olds do lack testamentary capacity, others do not. Age does not negate testamentary capacity;
  2. Second, the Court did not find that a genuine issue of capacity was raised merely by the fact that Laurette may have mistakenly thought that a 20 year old loan to Dawn, remained unpaid.   The Court held that the issue was not material. If the loan had been repaid in full and if Laurette was mistaken in the belief that the loan was still outstanding, did not itself lead to the conclusion that Laurette was not competent to execute the Will on January 8, 2020. The Court held:
  1. 52 …Although Laurette may very well have been wrong about the repayment of the loan, this circumstance does not compel the inference that she was incompetent or lacked testamentary capacity. Many people forget details of the past and the fact that one may have been mistaken does not mean that she was incompetent or was not capable of executing a valid will. Even assuming for the moment that a trial of an issue was ordered and the applicant was able to establish this point, it does not amount to “some evidence which if accepted at trial would tend to negative testamentary capacity”. See Dieno at para 32 and Kapacila at para 22.
  1. Similarly, the fact that Laurette may have forgotten some names and may have gone in the wrong direction after leaving a certain business on one or more occasions does not constitute evidence that would negate testamentary capacity.

Second, the Court held that Wayne had no firsthand evidence of undue influence in relation to this Will:

  1. The Court held that the theory of Wayne was that Grant, Don and Garth somehow fed Laurette misinformation about the misappropriation of funds which caused Laurette to wrongfully view Wayne in a negative light. However, the Court held that “even if Laurette was wrong about her presumptions and perceptions, there is no evidence that there was influence that would have overburdened her will.” (para 56)
  2. The Court also noted that there was a crucial difference between:
  1. Merely alleging that there was undue influence or circumstantially that there must have been an undue influence because of what Laurette did; and
  2. Offering actual firsthand evidence which is potentially capable of establishing undue influence in relation to a Will.
Conclusion:

Ultimately, the Court in Bell held that no genuine issue had been raised on Wayne’s evidence.

Rather, the uncontradicted evidence before the Court was that Laurette went to her lawyer and provided the lawyer with precise, cogent, clear instructions to remove Wayne as a beneficiary. The lawyer who drew the will was a very experienced lawyer in estates, took Laurette’s instructions and found no cause for suspecting undue influence or a lack of testamentary capacity.

Bell is an example of a case where the challenger no doubt had genuine concerns about what caused his mother to remove him from the Will. Such is a natural emotional reaction. That said, Bell reminds us that circumstantial concerns about unexplained actions by a testator (even if the testator’s actions are hurtful and shocking to a disinherited family member) are not the same as first-hand evidence, actually capable of establishing incapacity or actual coercion on the date of the signing of the Will.

Contacting a Lawyer on this Subject

James Steele’s preferred practise area is estate litigation, including will challenges, executor disputes, power of attorney issues, etc. Contact James Steele at 1-306-933-1338 or [email protected]. The above is for general information only, and not legal advice. Parties should always seek legal advice prior to taking action in specific situations.

Read more on our blog.

The Saskatchewan Estate Law blog is dedicated to providing practical, real-world information on Estate Law issues that affect Saskatchewan residents. The blog is written by RS lawyer, James Steele, whose practice focuses on estate litigation.

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Saskatchewan Estate Litigation Update: Martin v Martin, 2022 SKCA 79

The recent Saskatchewan Queen’s Bench decision in Peters (Estate) (Re), 2022 SKQB 186 prohibits the practice of altering an affidavit without actually re-swearing it.

Factual background:

The background facts in Peters can be described as follows:

  1. Antonia Peters died on March 1, 2022;
  2. She left a Will dated September 17, 2007. In that Will she named her husband, S. Frederick Peters, as executor and sole beneficiary of her estate;
  3. The Will provided that should her husband predecease Antonia, then two of her children (Edie Louise Nelson and Wally David Peters) would act as her executors;
  4. Her estate was then given to her children and grandchildren as well as two charities. There is nothing controversial about the Will itself;
  5. The initial application for grant of probate was filed on June 2, 2022;
  6. By fiat dated June 15, 2022, the Court rejected the application. The Court noted that the Will had named the testatrix’s husband as executor and that if he had predeceased her, then proof of the husband’s death was required under Rule 16-10 of The Queen’s Bench Rules;
  7. As well, what should be paragraph 4 of the probate application originally filed, had stated all beneficiaries named in the Will but did not list the husband as a beneficiary. The Court noted that it appeared that the husband had predeceased the testatrix. This reality required revision to the material;
  8. On July 25, 2022, a representative of the office of the executors’ solicitor removed the application, affidavits and Will to have the material corrected. Subsequently, revised and additional material was filed;
  9. The application and supporting affidavits were later refiled. A change was made only to the application form to read that all named beneficiaries had survived the deceased “except for S. Frederick Peters, who passed away on January 20, 2016”. Previously, on the initial filing, paragraph 4 had read that all named beneficiaries had survived the deceased;
  10. The Court found it problematic, however, that the executors’ affidavits were not re-sworn. What appeared to have occurred was that a new page containing a revised paragraph 4 was “slip-sheeted” into the material;
  11. That is, instead of the entire affidavit (and all of its pages) being re-sworn, the single erroneous page was revised and replaced after the affidavit had already been sworn before the deponents;
  12. Thus, the Court observed that the lack of a re-sworn affidavit meant that neither executor has verified under oath the revised, current content of the probate application.
Guidance offered by Peters:

The Court in Peters noted that the practice of slip-sheeting was being used more and more. However, such a practice was not consistent with the purpose of requiring a sworn affidavit from an executor who applies for probate.

Such an affidavit is not just a procedural hoop through which an applicant must leap. Rather, it verifies under oath the truth of the contents filed by the executor. The Court relies on these contents to be true, and the affidavit is the mechanism to verify that truth (as otherwise, a false sworn affidavit can lead to legal consequences, which incentivizes the deponent to be accurate).

The affidavit essentially takes the place of the deponent showing up in court, being affirmed or sworn, and testifying to the veracity of the application documents.

The “slip-sheeting” process entirely defeats the purpose of the affidavits. The two deponents of the affidavits in Peters could not have verified under oath the ultimate contents of the application (in its present form) when they first swore the affidavit in April.  This is because at the very moment that they had first sworn the original affidavits, the later slip sheeted pages were of course not yet in the affidavits.

Conclusion:

Ultimately in Peters, the court did not grant the application in the current form. The Court required that the executors refile fully sworn new affidavits.

Peters thus reminds us that affidavit exhibits need someone to identify and vouch for them. If a lawyer wants to change the content of an already sworn affidavit, the lawyer must have the client re-swear the affidavit in its final form.

Read more on our blog.

The Saskatchewan Estate Law blog is dedicated to providing practical, real-world information on Estate Law issues that affect Saskatchewan residents. The blog is written by RS lawyer, James Steele, whose practice focuses on estate litigation.

Contacting a Lawyer on this Subject

James Steele’s preferred practise area is estate litigation, including will challenges, executor disputes, power of attorney issues, etc. Contact James Steele at 1-306-933-1338 or [email protected]. The above is for general information only, and not legal advice. Parties should always seek legal advice prior to taking action in specific situations.

Saskatchewan Estate Litigation Update: Martin v Martin, 2022 SKCA 79

The recent Saskatchewan Court of Appeal decision in Martin v Martin, 2022 SKCA 79 offers a reminder of the litigation which can ensue when a person puts another family member on title, and a dispute later arises as to whether that person holds beneficial title, or, instead is merely on title as a trustee.

Martin reminds us that such disputes can be best avoided if all parties first sign a written agreement, at the time of the transfer, to document the parties’ intentions.

Overview:

Here, Richard Martin, the son of Martha Martin and Kenneth Martin, transferred title to his home into joint title with his parents, with rights of survivorship. For various reasons, Richard’s parents grew estranged from Richard, and they later applied for partition and sale of the property. Partition means that the property would be sold, and each person on title would be given a share of the sale proceeds (generally an equal division, unless there is a basis to order unequal division).

Richard argued in effect that his parents were on title as mere trustees, and Richard was the sole beneficial owner of the land. Thus, a trial was required to determine which side was correct.

Following a three-day trial, a Court of Queen’s Bench judge made an order directing the sale of the property, against Richard’s protests: Martin v Martin2020 SKQB 272.

Richard chose to appeal from that decision. Richard said that the trial judge committed errors in his fact-finding and placed too much weight on his mother’s evidence, which, he argues, was patently unreliable.

Factual background:

The factual background can be summarized below:

  1. In 1997, Richard purchased property located 20 km northwest of Saskatoon. Title to that property was initially registered in his sole name, but, two years later, he added his wife to the title and moved an old Eaton’s house onto the property;
  2. Richard intended to make renovations to the house. Richard began his renovation project in 2000, aided by his father, Kenneth, who was a skilled carpenter;
  3. Richard and his wife separated in 2001. When his wife assigned into bankruptcy shortly thereafter, the Credit Union demanded repayment of the construction loan. The Credit Union was prepared to reinstate the mortgage, provided Richard’s parents agreed to assume it and to replace Richard’s wife on the title;
  4. To achieve that end, and as part of Richard’s divorce settlement with his wife, Kenneth and Martha signed a loan agreement with the Credit Union, advanced $8,000 to Richard to enable him to settle his family property claim, and agreed to a transfer of title to their names and Richard’s as joint owners;
  5. The mortgage balance at the time of this transfer was $160,249, with the property (including the house) valued at $190,000. While the parties agreed that Richard had received $8,000 from his mother, they differed on the source of those funds, with Richard maintaining the funds were generated from the sale of some of his equipment;
  6. No agreement or memorandum was prepared at the time of the transfer to document the parties’ intentions or, contrary to Richard’s assertion at trial, to reflect that his parents only held legal title in trust for him;
  7. There was evidence from Bruce McDonald, who was Richard’s lawyer at the time of transfer. Mr. McDonald testified that title was transferred from Richard and his ex-wife’s names into the joint names of Richard and his parents because Richard had expressed concerns over the possibility that he would be required to divide the equity in the property with any future spouse in the event of his remarriage;
  8. Richard however testified that he had instructed his lawyer to transfer the property into joint names for estate planning purposes;
  9. As noted, renovations to the house commenced in 2000. It was undisputed at trial that Kenneth had provided considerable assistance to Richard over the years in connection with the renovation project. While the parties differed on how much time Kenneth had devoted to the project, Richard was prepared to concede that it was around 3,000 hours;
  10. The relationship between Richard and his parents broke down in or around 2010 over a financial dispute relating to a family-run towing business;
  11. Kenneth passed away in 2012. Martha is the executor of his  Shortly before Kenneth’s death, he and Martha had commenced an action against Richard alleging “a joint investment in the Land and a business” in which they had made substantial payments towards the cost, upkeep and renovations to Richard’s house;
  12. By way of relief, Kenneth and Martha sought an order for the sale of the property and a division of the proceeds “according to their respective interests” or, alternatively, for partition of the property;
  13. Richard filed a statement of defence in which he denied that:
  1. Martha and Kenneth had obtained title to the property for investment purposes;
  2. Martha and Kenneth had paid for the materials for the property;
  3. Kenneth had worked on his house to the extent asserted in the statement of claim (approximately 13,000 hours); and
  4. His parents had made payments towards the mortgage, utilities or taxes. According to Richard, all of those payments came from a joint bank account that he held with his mother, and the deposits into that account had been generated from income derived from his business
Handwritten ledgers maintained by Martha:

Martha testified on her own behalf at trial and in her capacity as the executor of Kenneth’s estate. She tendered five handwritten ledgers as evidence of how she had documented the various advances she and Kenneth made to Richard over the years, along with expenses they had personally incurred on his behalf. The ledgers included items such as mortgage payments, but also referenced payments related to Richard’s tow-truck business. However, the trial judge found the ledgers to be unclear with regard to how much money Richard allegedly owed his parents. The trial judge remarked on how Martha was uncertain about many of the entries.

Richard in turn argued that he had put approximately $450,000 of his own money into the property. However, the trial judge rejected Richard’s testimony about his alleged financial contributions to the property. However, the trial judge went on to find that it was “impossible from the evidence presented to determine the absolute or relative financial contribution made by Richard on the one hand and Kenneth and Martha on the other to the Land” (at para 24 of the trial decision).

Decision of the Court of Queen’s Bench:

The trial judge ruled against Richard, and found that the circumstances all pointed to an intention on Richard’s part to convey a beneficial interest in the property to his parents. Thus, his parents were entitled to seek partition.

While the trial judge accepted that the sale of the property would cause Richard an inconvenience, particularly if he were forced to move, he nonetheless found this reason was not one recognized at law as a basis to refuse an application for partition or sale. He concluded by saying that “[t]here is nothing in the factual situation of this case that overrides the direction of the Court that a partition shall be ordered” (at para 33).

The trial judge also addressed the issue of the quantification of Richard’s and Martha’s respective interests in the property following Kenneth’s death. The trial judge noted that Kenneth’s share would devolve equally in Martha and Richard, “resulting in them each owning a one-half interest in the property …” (at para 43). That said, the trial judge determined that where a party commences legal proceedings for partition prior to death, the joint tenancy is severed on the commencement of that action, and the estate is entitled to proceed with that action after the death of the party. The trial judge concluded, as such, Kenneth’s estate in its own right, but also Martha and Richard, were each determined to be the owner of an undivided one-third interest in the Land (at para 43).

Based on these findings, the trial judge ordered severance of the joint tenancy. In the event Richard did not purchase the remaining two-thirds interest held by Martha and the estate on an agreed upon or court-ordered price, the property would be listed for sale.

Issues on appeal:

Richard did not ground his appeal in an error of law, nor did he take issue with the trial judge’s crucial findings that:

  1. A trust was not created;
  2. Legal and beneficial title vested in all three parties;
  3. The joint tenancy was severed at the commencement of his parents’ legal proceedings;
  4. His parents were not motivated by a malicious or a vexatious intent designed to oppress him; and
  5. There was no equitable reason to depart from dividing the sale proceeds in proportion to ownership.

Instead, Richard’s grounds of appeal, could be distilled to the following:

  1. Was Martha an unreliable witness and, if so, did the trial judge err in accepting her evidence about financial contributions to the property as alleged in her statement of claim?
  2. Did the trial judge err in rejecting Richard’s evidence in that regard?
  3. Did the trial judge err in not dividing the sale proceeds unequally in Richard’s favour?
Decision of the Court of Appeal:

The Court of Appeal dismissed Richard’s appeal. Its reasons can be distilled to the below.

First, Richard’s core arguments directly challenged the trial judge’s credibility and reliability findings and, most pointedly, took aim at the reliability of Martha’s testimony, the weight assigned to her evidence, and the rejection of his evidence in the face of an alleged patently unreliable witness.

However, credibility and reliability findings are findings of fact. For that reason, the standard of appellate review for such matters is highly deferential. A determination of the weight to be assigned to the evidence is also a matter for the trier of fact: “it is not the role of appellate courts to second-guess the weight to be assigned to the various items of evidence”.

Moreover, the trial judge was entitled to rely on some of Martha’s evidence, but not rely on other parts of it. It was true that the trial judge concluded he could not put any weight on Martha’s ledgers and notebooks or on her testimony about the specific entries in them to determine the quantificationof the amount of money she and Kenneth had put into the property and Richard’s house.

That determination, however, did not preclude him from finding that Martha’s evidence was sufficiently reliable with regard to her overall assertion that she and Kenneth had made financial contributions toward the renovations and upkeep of Richard’s house. The fact that the trial judge found he could not rely on her documentary evidence to quantifythe precise contributions they had made over the years did not mean that he had to reject her evidence outright.

Put another way, the trial judge was satisfied that Martha’s core allegation – that she and Kenneth had financially assisted Richard with the renovations to his house and to its upkeep – was reliable. 

For Richard to succeed on his appeal, he had to do more than simply disagree with the trial judge’s credibility and reliability findings. Richard had to point to the mishandling of specific parts of the evidence that reveal a palpable error and then show how that error affected the outcome. Richard did not do that.

The judge’s failure to order unequal distribution:

Richard also appealed on the basis that the trial judge had wrongly failed to order an unequal division of the sale proceeds.

The Court of Appeal however agreed with the decision of the trial judge. Martha and Kenneth were on title as co-owners in joint tenancy. On the face of it, they were entitled to apply for partition and sale, regardless of whether they had made financial or in-kind labour contributions.

Moreover, as per the facts found by the trial judge, Richard had not demonstrated any basis for an unequal division of the sale proceeds in his favour. Richard had not shown any overriding error in these factual conclusions by the trial judge.

Conclusion:

As the Court in Martin v Martin, 2022 SKCA 79 observed, Saskatchewan case law is replete with situations where a parent gratuitously transfers real property into joint title with an adult child but later changes their mind about the arrangement. The reality is that such a decision is legally difficult to undo.

Martin reminds us that any person who puts anyone else on title, without receiving value in exchange, should take care to speak first with a lawyer about the consequences of doing so. Any such person should anticipate what would happen if they later have a falling out with the person who is going on title. A lawyer can help first advise as to what paperwork should be executed by all sides before the transfer, to later prove what the real intention is behind the transfer, and who is the true beneficial owner.

Read more on our blog.

The Saskatchewan Estate Law blog is dedicated to providing practical, real-world information on Estate Law issues that affect Saskatchewan residents. The blog is written by RS lawyer, James Steele, whose practice focuses on estate litigation.

Contacting a Lawyer on this Subject

James Steele’s preferred practise area is estate litigation, including will challenges, executor disputes, power of attorney issues, etc. Contact James Steele at 1-306-933-1338 or [email protected]. The above is for general information only, and not legal advice. Parties should always seek legal advice prior to taking action in specific situations.

Area of ExpertiseEstate Litigation