The recent Saskatchewan King’s Bench decision in Mang v. Hofer offers a reminder of the threshold criteria that an applicant must meet in order to become the administrator of an intestate estate.

For context, when a deceased dies without a will their estate falls into intestacy. If so, an administrator is appointed by the Court to distribute the estate property as per The Intestate Succession Act, 2019. This legislation governs situations in which there is no will. Most typically the person who applies to be appointed administrator is a family member of the deceased. On rare occasions a creditor of the deceased may apply to be the administrator of the estate. Whether or not a creditor is appointed as administrator will depend on whether their application meets all of the legal requirements imposed by law. In Mang, the application by the creditor did not meet those requirements.

Background:

The factual background in Mang included the below:

1. Michah Shapir Mang (“Mang”) claimed that he was a creditor of Leandra Lynne Newman (“Newman”). Mang sued Newman and two other people for injuries sustained when three people attacked him at a party (“Lawsuit”);
2. Mang later discontinued his claims as against the two other defendants. Mang then sought to continue his claim against Newman but then discovered that Newman had died in March 2021;
3. After Newman’s death, Mang then took steps to appoint a third-party lawyer (not the same lawyer who is discussed in this case comment) as the administrator ad litemof the estate of Newman (“Estate”). An administrator ad litem is a person appointed by the Court to make decisions for an estate during a lawsuit. This is typically done when there is no appointed administrator who is already administering the estate;
4. On March 3, 2024, the Court appointed the third party lawyer as administrator ad litem in of the Estate of Leandra Newman. By July 2024, the Lawsuit had been settled. It appears that the administrator ad litem entered into Minutes of Settlement (“Minutes”) to resolve Mang’s claim. The Minutes provided for the below:

1. Newman, personally, would pay Mang $180,000.00 to settle the action. By this time Newman had been dead for about three years, and so it was odd that the Minutes did not refer to Newman’s “Estate” as the entity required to pay such sum; and
2. Mang agreed to discontinue the Lawsuit upon the Minutes being signed. He did so in July 2024.

5. To actually liquidate and distribute an intestate estate there must be an administrator. The administrator will itemize the assets, sell them, produce liquid sale proceeds, pay all lawful professional fees, taxes and debts etc. At the end of this process there will be a pool of money left over that can be distributed to the beneficiaries of the intestate estate;
6. Mang thus required someone to step in and act as administrator of the Estate for the purpose of liquidating assets and distributing them. As a creditor of the Estate (under the Minutes) Mang had an interest in ensuring that the Estate got liquidated and distributed;
7. The decision in Mang therefore dealt with the application by Mang for letters of administration in the Estate. Interestingly, Mang did not wish the letters to be granted to Mang directly. Rather, Mang requested that the Court granted letters of administration to his personal lawyer (“Lawyer”), the same Lawyer who had acted for Mang when the Minutes were negotiated with the administrator ad litem of the Estate;
8. Newman had a common law spouse, Wesley Hofer (“Hofer”). Hofer indicated that he was cohabiting with Newman when she died on March 27, 2021 and they had continuously cohabited for over two years prior to that date. Hofer alleged that they had a spousal relationship. Thus, Hofer stood to be a beneficiary in the Estate;
9. Mang had not previously notified Hofer when Mang had appointed an administrator ad litem for the Estate and had negotiated the Minutes. Hofer only learned about such developments after the fact.

Issue:

This case comment focuses on the below issues which were discussed in Mang:

1. Issue 1: Was it appropriate to appoint the Lawyer as the administrator of the Estate?
2. Issue 2: What was the appropriate disposition on costs?

Decision in Mang:

The Court dismissed the application to appoint the Lawyer as administrator.

1. Issue 1: Was it appropriate to appoint the Lawyer as the administrator of the Estate?

The Court had serious concerns with the application to appoint the Lawyer as the administrator of the Estate. Out of the various deficiencies in the application, the below points are important for estate administration lawyers to bear in mind.

First, the Court did not find any jurisdiction to make the order. The Court noted that:

1. The Court had no evidence that Newman lived in Saskatchewan when she died; and
2. The Court had no evidence that Newman owned property in Saskatchewan when she died.

The Court was troubled by the lack of any evidence of what property the Estate even owned. Typically, the Court is presented with carefully compiled information on all of the assets which the deceased own and their value. In contrast, this application simply put the word “unknown” in relation to the listing of Estate property:

23      It appears [the Lawyer] relies on  4(1)(a)(ii): Newman lived outside Saskatchewan but left property here when she died. What property? [The Lawyer’s] statement of property, which she purports to verify by affidavit, says “unknown” in answer to every category of property in the statement. Section 4(1)expressly requires “proof” of the matters listed in subsection (a). In fact [the Lawyer] has tendered no proof at all of Newman owning any property here….

[emphasis added]

Second, the Court noted that the applicant Lawyer had no priority to be appointed. The Court noted that The King’s Bench Rules set out a clear priority of which persons are eligible to be appointed:

16-24 If the deceased died intestate, the persons entitled to apply for a grant of administration are the following in order of priority:

1. spouse of the deceased;
2. children of the deceased;
3. grandchildren and other issue of the deceased taking per stirpes;
4. father or mother of the deceased;
5. siblings of the deceased;
6. nephews and nieces of the deceased;
7. next of kin of the deceased of equal degree of consanguinity;
8. creditors of the deceased;
9. the official administrator.

[emphasis added]

The Court noted that Mang, a creditor, ranked second-last in priority. The spouse, Hofer, ranked first in priority. Thus, Mang had not established that he (much less his Lawyer) had priority to apply to be the administrator. Related to this, Rule 16-26 required that Mang clear off the interests of those with a greater priority in the Estate. Here, Mang had not obtained a court order or renunciation to clear off the prior rights of Hofer.

A third problem was that the Lawyer herself had no beneficial interest in the Estate property. It must be noted that Mang and his Lawyer are two distinct people in law.

Here, there was no power of attorney given by Mang in favour of the Lawyer. Thus, it was not appropriate to appoint the Lawyer to personally be the administrator of the Estate. Rule 16-25 requires that an applicant has a beneficial interest in the property to be administered. Here, the Lawyer personally had no stake or legal interest in the Estate property.

A fourth problem was that the Lawyer would be in a conflict of interest if they were appointed as the administrator of the Estate. An administrator of the Estate is bound in law to administer it in the interests of all Estate beneficiaries, and not to prefer the interests of an Estate creditor over the interests of the Estate beneficiaries. Here, Hofer had an interest in the Estate property. Thus the Lawyer as administrator would need to administer the Estate in the interest of the Estate beneficiary (Hofer). However, at the very same time, the Lawyer would be wearing a second hat, given the Lawyer’s existing solicitor-client relationship with Mang (a creditor).

33 None of this has been done. The originating application expressly contemplates Ms. Gebhart somehow being granted status as administrator as Mang’s “representative”. Nowhere in Saskatchewan law is this contemplated. Further, as is explored below, there is a professional and ethical dimension to this proposed course of action. Mang contemplates Ms. Gebhart — his lawyer, hired to collect $180,000 from a settlement entered into by a dead woman — would represent his interests. But that is not what an administrator does. The duty of administrators is partly reflected in para. 4 of the affidavit of applicant. The conflict issues seem obvious.

…

48      An administrator must assess and balance claims and interests. An administrator having a real or perceived bias or partiality toward any involved party should not be the administrator. The circumstances of this case speak for themselves. It is so clear [the Lawyer] is headed for trouble that I simply cannot understand how she did not see it, either before appearing in chambers or during, when the issue was specifically raised with her.

49      Again, the Law Society’s Codeis instructive:

4-1A lawyer must not act or continue to act for a client where there is a conflict of interest, except as permitted under this Code.

50      I will not belabour this point. It seems to me to be clear and obvious that [the Lawyer] is headed into a conflict situation. She acted adverse in interest to Newman and/or her estate when she acted on Mang’s collection matter. She cannot now act for that estate and Mang at the same time. She should not be the administrator of this estate as a “representative” of Mang or otherwise.

Given all of these deficiencies in the application, the Court dismissed the application.

2. Issue 2: What was the appropriate disposition on costs?

The Court was frustrated with the shortcomings in the application. These led the Court to order substantial costs against Mang:

57      …. As noted by this decision, numerous concepts were engaged. The material was not voluminous, true. But a page count does not solely determine complexity. A lot of work was required to untangle the mess that was plunked down before the Court.

58      The principle of general application is that costs follow the event, and the costs of a chambers matter ought to be determined right at that time. Having regard to all the considerations set out in Part 11 of our Rules and the applicable cases, I set the costs that Mang must pay to Hofer at $2,000.00, payable in any event of the cause and payable within 90 days of this decision. Further, these costs must be fully paid before any further steps are taken by or on behalf of Mang in this matter or regarding the Newman estate.

Conclusion:

The Court dismissed the application in its entirety. The Court also made an order prohibiting the Lawyer (or members of her law firm) from acting as administrator in the Estate of Leandra Newman.

Mang v. Hofer offers a reminder of the importance of carefully reviewing the legal requirements which govern your Court application. You need to methodically examine all legislation, rules or other legal requirements which your application must meet. You must then cross-reference them against the evidence supporting your own application. You must ensure that your application comprehensively meets each of the requirements.

The above is for general information only, and not legal advice. Parties should always seek legal advice prior to taking action in specific situations. 

The recent Saskatchewan King’s Bench decision in Reader Estate v. Reader demonstrated the Court’s power to rectify a Will where a drafting error threatened to defeat the intention of the testator.

Background:

The factual background in Reader Estate included the below:

1. Sheryl Ann Reader (“Sheryl”) and Dale Rodger Reader (“Dale”) had married in 1972;
2. They had two children, Carmen Reader (“Carmen”) and Daryl Reader (“Daryl”). Both of Carmen and Daryl were born with cognitive and physical disabilities;
3. Sheryl and Dale separated on January 8, 2018;
4. Sheryl’s daughter Carmen died on March 7, 2018;
5. In September 2019, Sheryl signed a lawyer-drafted will dated October 2, 2019 (“Will”);
6. On November 1, 2019, Sheryl filed a petition seeking division of the family home and family property. Dale filed an answer on May 5, 2021;
7. Sheryl died on November 13, 2020. Sheryl in her Will left a life estate to her son, Daryl, in the form of a “Henson Trust”.  This type of trust is established primarily for the benefit of individuals with disabilities, particularly those who may receive government benefits. The key purpose of a Henson Trust is to protect the assets held within the trust from being considered as assets of the beneficiary for the purpose of determining eligibility for government assistance programs;
8. On February 8, 2023, letters probate issued in the Estate of Sheryl. They appointed Sheryl’s sisters, Linda Joy McCrank (“Linda”) and Debra Lee Olliver (“Debra”), as executrices of Sheryl’s Estate;
9. Daryl died on March 10, 2023;
10. On June 5, 2023, Dale was appointed as administrator of the Estate of Daryl;
11. On May 30, 2024, Dale Reader died;

Issues with the Will:

12. The Will contained an oversight. While the Will provided for a life estate for Daryl in the Henson Trust, this trust ended upon the death of Daryl. The Will did not then direct what would happen to the overall property remaining in the Estate after the death of Daryl. This was an omission by the lawyer who had drafted the Will in 2019;
13. The intention of Sheryl had been to designate her sisters, Linda and Debra, as beneficiaries in the Will relating to what property may still exist when Daryl died;
14. The lawyer who drafted the Will swore an affidavit to provide evidence about what instructions Sheryl had given him. It said in part:

9. I also explained to Sheryl that the Will should include provisions for who receives the benefit of the estate in the event that Sheryl either outlived Daryl or that Daryl dies before the whole of the Sheryl’s estate could be distributed to Daryl. Sheryl advised that in either of those circumstances she wanted her sisters, Linda Joy McCrank (“Linda”) or Debra Lee Olliver (“Debra”) to receive the benefit of the estate.

10. I drafted the Will as requested by Sheryl and in doing so included a provision that that [sic] Linda and Debra were the alternative beneficiaries, but I inadvertently failed to name Linda and Debra as the beneficiaries of any portion of the estate which remained in the event that Daryl outlived Sheryl but died prior to the entirety of the estate being distributed to Daryl.

Issue:

This article focuses on the below issues which were before the Court:

1. Issue 1: Did the Will provide for distribution of the Estate after the death of Daryl?
2. Issue 2: Should the Court rectify the terms of the Will to give effect to the intentions of Sheryl?

Decision:

The Court held the below:

1. Issue 1: Did the Will provide for distribution of the Estate after the death of Daryl?

The Court held that the Will, on its face, did not provide for the distribution of the Estate to a named beneficiary upon the death of Daryl.

The Court held that in the ordinary course, this drafting error would be corrected with consent of the affected parties. In this case, the dispute between Sheryl and Dale arising from their separation precluded such a resolution.

2. Issue 2: Should the Court rectify the terms of the Will to give effect to the intentions of Sheryl?

The Court held that it was appropriate that it re-write the drafting error to give effect to Sheryl’s intention at the time she signed the Will.

The Court noted that the Will’s failure to name Linda and Debra as beneficiaries of the residue was due to an admitted error by the lawyer. The Court accepted that Sheryl’s intention had been for Linda and Debra to inherit what remained of her estate after the death of her son, Daryl:

60      The evidence from the affidavits of Brenda Walper-Bossence and Donald Grant Orr satisfy me that Sheryl intended to name her sisters, Linda Joy McCrank and Donna Lee Olliver, as both her executrices and residual beneficiaries, to inherit what remained of her estate after the death of her son, Daryl. Ms. Walper-Bossence and Mr. Orr are senior, reputable lawyers. Their affidavit evidence is objective, convincing, and mutually corroborative of Sheryl’s intent.

The Court gave no criticism of the lawyer who made the drafting error, finding that such an error could “happen to anyone.” The Court held that this was an appropriate situation in which to correct the Will and reflect Sheryl’s intention at the time she made the Will.

Thus, the court rectified the Will. The Court did this by replacing para 3(c) of the Will with the below:

The intent of this change was to allow a final distribution of the Estate to Linda and Debra in equal shares, after payment of any outstanding debts or charges against the Estate.

Costs:

The Court reviewed prior case law and concluded that it was appropriate that Linda and Debra receive their costs from the estate. They had been required to bring this application to determine how to address the defect in the Will.

The Court therefore made the following order:

69 I see no reason not to follow this practice in this case. There was a defect in the Will which needed to be addressed. Dale challenged the Will, so no agreement was possible. Sheryl’s Executrices acted properly as trustees in applying to settle the issue. There were opposing views and claims which protracted the proceedings. The Court’s assistance was required to settle the matter.

70 I order that the reasonable and actual costs incurred by Sheryl’s Executrices be paid from the Estate. If there is a dispute over the reasonableness of the amount, that issue can be returned to me for decision.

Conclusion:

The result in Reader Estate was a practical one. It gave effect to what was the intention of the deceased, as to how her own property would be distributed.

Nowhere in the decision was the word “rectify” or “rectification” used. For the sake of interest, it is worth noting that the accepted legal term for re-writing a will is “rectification” of the Will. The equitable power of rectification is aimed at preventing the defeat of the testamentary intention due to omissions by the drafter of the will.

Where there is no ambiguity on the face of the will, and the testator has reviewed and approved the wording, Canadian courts will rectify the will and correct unintended errors in three situations:

1. Where there is an accidental slip or omission because of a typographical error;
2. Where the testator’s instructions have been misunderstood; or
3. Where the testator’s instructions have not been carried out.

In most situations, an application for rectification is supported by an affidavit from the solicitor who drafted the will documenting the testator’s instructions, and explaining how the solicitor or their staff failed to implement the instructions or made a typographical error (see Robinson Estate v. Robinson, 2010 CarswellOnt 4576, 2010 ONSC 3484 at para 24-25).