Recent court decisions and pending legislation are going to have an impact on the trust and estate field, Jordan Atin told a Society of Trust and Estate Practitioners conference in Toronto.
Changing family dynamics ó as seen in separations, divorce, common law marriages and blended families ó will likely result in more court-imposed responsibilities on the trust and estate sector, a conference has heard.
Already, courts have weighed in on the ranking of stepchildren and much-younger female companions, Jordan Atin told the Society of Trust and Estate Practitioners national conference held in Toronto. Meantime, legislative changes are in the works that could also impact the field.
Atin, of Toronto law firm Hull & Hull, cited a number of disparate court cases that, in their own small ways, are impacting on the standing of various parties in court actions involving wills.
In Doman Peri v. Doman Estate  B.C.J. No. 1904, for example, the B.C. Court of Appeal looked at whether a 55-year-old stepchild had standing to vary the will of the step-parent to seek dependantís relief under the Wills Variation Act. The act didnít define "children" and the testator had left nothing for the stepson ó the court held that stepchildren could not be considered a child of the deceased.
However, Atin said, the door was left open and at some point stepchildren who can prove a continuing relationship with a step-parent may well start winning standing.
The conflicts of blended families was again under the spotlight in Tenorio v. Redman Estate  B.C.J. No. 1957, wherein the B.C. Supreme Court considered the case of a woman who claimed the role of spouse in her relationship with an elderly man.
The testatorsí son claimed she was no more than a caretaker, pointing to the 22-year age difference, and that they slept in separate bedrooms. Evidence on the nature of their relationship conflicted.
The court ruled there was a relationship: "What [the deceased] looked for and what he got was more than a caretaker relationship. On all the evidence, I conclude that he genuinely found real comfort and solace with the plaintiff. They shared a closeness and physical intimacy and he enjoyed that. While all the details are not to be known, that at least seems clear."
As a spouse, she was then able to bring an application for dependant support and was awarded $100,000 from the estate.
Atin said such relationships are going to be a common area of contention as elderly testators look for companionship in their sunset years, and possibly trigger disappointment among other beneficiaries.
Beyond the broad-brush societal trends, there have also been some interesting cases dealing with nuts and bolts of wills and estates, Atin said.
Fiduciary duties have been reviewed in several cases, the most recent out of the Court of Queenís Bench of Alberta and two from the Ontario Superior Court of Justice.
In the Alberta case, Meier v. Rose  A.J. No. 115, Alex Rose prepared a will as instructed by his longtime client Gary Meier on an emergency basis for the following day. He specifically wanted to leave his farmland to his brother Robert. Gary Meier died but the intent of the gift was thwarted when it was discovered that he didnít own the land directly but rather through one of his companies.
Robert sued and the court held the lawyer had a duty of care to the brother and awarded $484,200, ruling a "reasonably competent solicitor" would have known Meierís tendency to blur the lines between his personal holdings and his corporate holdings and should have executed a title search to ascertain the facts.
"Maybe the lawyer could have avoided this with a waiver saying this was an emergency will and that he wasnít going to check the title," Atin said. He joked that the case "has put the kibosh on my plans to open a booth at Pearson Airport and write instant wills for travelers and retire from the proceeds."
In an Ontario case, Hooper Estate v. Hooper  O.J. No. 3535, he said, the court took a son to task for his failure to fulfil his duty to pass on accounts in a timely manner and for unlawfully interfering with the financial affairs of his deceased father. The court admonished the son, saying he not only had a duty to his fatherís estate but to the beneficiaries.
Another Ontario case involved a daughter who offered to help her mother manage her financial affairs by paying bills. In Miller v. Miller  O.J. No. 5819, the daughter was not acting under power of attorney but had a joint account with her mother.
But instead of helping to manage her motherís accounts, the court heard the daughter depleted the assets of $230,000 for her own purposes to the point where the mother could not buy the home she wanted.
When confronted, the daughter called 911 and had her mother involuntarily committed. In due course, her mother was found to be of sound mind, released and then initiated legal action.
The court held that even though a POA was not in place, the daughter breached her fiduciary duty to act in her motherís best interests because the mother was financially and emotionally vulnerable. In the case, the court imposed the fiduciary duty.
Atin added there are some regulatory changes worth examining.
One is an amendment to the Estate Administration Tax Act, to take effect next January 1, that empowers the minister of revenue to conduct audits of an estate and the administrative tax paid. He said Ontario will join the trend of requiring inventory to be filed before probate and that the minister of revenue will be able to assess or reassess an estate on an open-ended basis in a "reasonable time upon establishing the estate trustee has not filed the information required, or any person made a misrepresentation through neglect, carelessness or willful default, or committed any fraud in supplying or omitting information."
Atin observed: "It provides for fine and imprisonment, which we hope they donít resort to. The big problem is how, as the estate trustee, can you protect yourself if you canít get a clearance certificate from the ministry and then they come back and say you owe another $3,000? We hope the wording will be cleared up."