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Estates II

. McTavish v. Reed

In McTavish v. Reed (Ont CA, 2021) the Court of Appeal set out some basics of estate law:
[15] The right of survivorship applies only to interests in property held in a joint tenancy: Hansen Estate v. Hansen, 2012 ONCA 112, 109 O.R. (3d) 241, at paras. 30-31. Section 2(1) of the Estate Administration Act, R.S.O. 1990, c. E. 22, provides that real or personal property, vested in a person without a right in any other person to take by survivorship, devolves to the person’s personal representative on his/her death to be administered as part of the estate.
. Feinstein v. Freedman

In Feinstein v. Freedman (Div Ct, 2021) the Divisional Court considered the awarding of trustee's fees and a conflict issue:
[64] The trial judge went on to deal specifically with the submission that the respondent’s compensation should be reduced in accordance with guidelines that have become known in estate matters as “the tariff”. The tariff is based on the decision in Re Jeffery Estate (1990), 39 E.T.R. 173 (Ont. Surr. Ct.), in which Killeen J. held that, in Ontario (p. 178):
a practice has developed of awarding compensation on the basis of 2 1/2 per cent percentages against the four categories of capital receipts, capital disbursements, revenue receipts and revenue disbursements, along with, in appropriate cases, a management fee of 2/5 of 1 per cent per annum on the gross value of the estate…
[65] Killeen J. held that the result of this calculation should be measured against five factors identified in the earlier case of Re Toronto General Trusts Corp. and Central Ontario Railway (1905), 6 O.W.R. 350 (H.C.), to determine whether the tariff amount is appropriate. The five factors identified in Toronto General Trusts are (p. 354):
(1) the size of the trust;

(2) the care and responsibility arising from the size of the trust;

(3) the time occupied in performing the duties of trustee;

(4) the skill and ability displayed by the trustee; and

(5) the success resulting from the trustee’s efforts.
[66] The decision in Jeffrey Estate was approved of by the Ontario Court of Appeal in Laing Estate v. Hines (1998), 1998 CanLII 6867 (ON CA), 41 O.R. (3d) 571, 167 D.L.R. (4th) 150, at para. 9.

....

[105] Section 61(1) of the Trustee Act provides:
A trustee, guardian or personal representative is entitled to such fair and reasonable allowance for the care, pains and trouble, and the time expended in and about the estate, as may be allowed by a judge of the Superior Court of Justice.
[106] As the Court of Appeal noted in Laing Estate, the fixing of compensation under s. 61(1) “is far from an exact science”: para. 10. Once the tariff has proven inadequate, the exercise becomes a highly discretionary one. Counsel for the appellants demonstrated this during argument when he was asked how this court might arrive at a more appropriate amount of compensation. He suggested a reduction of 30 to 40 percent based on nothing more than a “holistic review” of the accounts. The trial judge’s reduction of the respondent’s account appears to have been undertaken on a much more precise and principled basis than the one suggested by counsel for the appellants.

[107] As counsel for the respondent points out, after referring to the shortcomings in the respondent’s work as trustee, the trial judge reduced the compensation sought by exactly $65,000 (from $289,197 to $224,197). This coincides perfectly with the number of months the respondent acted as trustee, as the trial judge mentioned in para. 4 of his reasons, and represents a reduction of precisely $1,000 per month. Thus, contrary to the submissions of the appellants, how the trial judge arrived at the amount of compensation is clear. The final question is whether the amount arrived at was fair and reasonable.

[108] In Laing Estate, the Court of Appeal reaffirmed that the trial judge’s discretion should not be interfered with unless “there is an error in principle, or if, in its opinion, the amount allowed is grossly insufficient or excessive” ( para. 10). I can find no error in principle, nor does the amount allowed appear to be excessive.
. Ross v. Canada Trust Company

In Ross v. Canada Trust Company (Ont CA, 2021) the Court of Appeal considers the 'armchair' rule of will interpretation:
[37] The basic approach to the construction of a will was described by this court in Burke (Re), 1959 CanLII 113 (ON CA), [1960] O.R. 26 (C.A.), at p. 30:
Each Judge must endeavour to place himself in the position of the testator at the time when the last will and testament was made. He should concentrate his thoughts on the circumstances which then existed and which might reasonably be expected to influence the testator in the disposition of his property. He must give due weight to those circumstances in so far as they bear on the intention of the testator. He should then study the whole contents of the will and, after full consideration of all the provisions and language used therein, try to find what intention was in the mind of the testator. When an opinion has been formed as to that intention, the Court should strive to give effect to it and should do so unless there is some rule or principle of law that prohibits it from doing so.
[38] While a key element of Burke’s approach to will interpretation is, of course, studying the document’s contents – not only the provisions in dispute but the entire will – its approach also includes the use of what is known as the “armchair rule”. Ian Hull and Suzana Popovic-Montag, Feeney’s Canadian Law of Wills, 4th ed. (Toronto: LexisNexis, 2020) at §§10.45 and 10.46, describes the “armchair rule” as follows:
In the first instance, the court may not be convinced that the testator’s intention can be discerned from the will itself. In such a situation, since the testator must be taken to have used the language of the will in view of the surrounding circumstances known to him or her when he or she made his or her will, evidence of such circumstances is necessarily admissible, at least insofar as it corresponds to the facts and circumstances referred to in the will. It seems obvious that a court might conclude that admissible evidence of surrounding circumstances is not helpful in determining meaning.



The court puts itself in the position of the testator at the point when he or she made his or her will, and, from that vantage point, reads the will, and construes it, in the light of the surrounding facts and circumstances. This approach is commonly referred to as the “armchair rule”.
[39] Sitting in the place of the testator, the court assumes the same knowledge the testator had, at the time of making the will, in regard to the nature and extent of her assets, the makeup of her family, and her relationship to its members: Stuart v. Stuart, 2019 ONSC 4328, 49 E.T.R. (4th) 306, at para. 9; Dobson Estate v. Dobson (2000), 32 E.T.R. (2d) 62 (Ont. S.C.), at para. 8; Shamas (Re), 1967 CanLII 303 (ON CA), [1967] 2 O.R. 275 (C.A.), at p. 279, citing Perrin v. Morgan, [1943] A.C. 399 (U.K. H.L.), at pp. 420-21.

[40] In the past, courts usually have resorted to the “armchair rule” where the testator’s intention cannot be ascertained from the plain meaning of the will’s language: Dice v. Dice Estate, 2012 ONCA 468, 111 O.R. (3d) 407, at para. 37.

[41] More recently, courts are treating the “armchair rule” as an over-arching framework within which a judge applies the various tools for will construction at his or her disposal. As put by the Court of Appeal of Manitoba in Zindler, at para. 14:
Feeney’s [Canadian Law of Wills] concludes that “the most recent trend in Canadian cases seems to indicate that evidence of surrounding circumstances should be taken into account in all cases before a court reaches any final determination of the meaning of words” (at para. 10.54). This is true even if the words, themselves, do not appear to be ambiguous or unclear…
. Ross v. Canada Trust Company

In Ross v. Canada Trust Company (Ont CA, 2021) the Court of Appeal considers the presumption that a will vests on death:
[57] The law presumes that a testator intends for interests to vest at his or her death or at the earliest moment thereafter as is consonant with the terms of the will: Albert H. Oosterhoff et al., Oosterhoff on Wills, 8th ed. (Toronto: Thomson Reuters, 2016), at §17.3.2. An instance of the application of this presumption, upon which Gordon relies, is where there is a direction to pay the income of a fund to one person during his lifetime and to divide the capital among certain other named and ascertained persons on his death, even though there are no direct words of gift either of the life interest or of the capital. In those circumstances the rule is that vesting of the capital takes place in the remaindermen at the time of the testator’s death: Browne v. Moody, 1936 CanLII 119 (UK JCPC), [1936] O.R. 422 (U.K. P.C.), at p. 427.

[58] However, the presumption of early vesting is just that – a presumption. Like any presumption, it may be displaced by a finding regarding the actual intention of the testator as reflected in her will. As put in Feeney’s Canadian Law of Wills, at §§17.7 and 17.8:
The courts are inclined to hold a gift as vested rather than contingent wherever the particular words used, and the will as a whole, admit of a construction that will result, as is said, in “early vesting”. That inclination has always been said to be particularly strong where the property is land. It is accurate to refer to the tendency of courts to call gifts “vested” as a presumption to that effect, so it can be said that gifts are to be held to be vested unless there is a clear condition precedent. Accordingly, a gift, whether a devise or a legacy, that makes no reference to the time of vesting should always be held to take effect at the testator’s death, unless that date of vesting would disturb provisions already made in the will, or unless the will, as a whole, evinces a clear intention that the gift operate contingently and at a later date.

The recent trend of jurisprudence has been to strive to establish and implement the actual intentions of the will-maker. Consequently, the presumption in favour of early vesting as well as any other “rules” of construction may be applied only if the courts have some doubt about the will-maker’s intention.


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