August 12, 2022
Another reason to be careful about the drafting of your will.
THE ISSUE
Sometimes people making a will (a “testator”) want to make sure that a friend or family member has a place to live following the death triggering the provisions of the will. It is also not uncommon for wills to provide that if the friend or family member does not want to live in the house, the house will be sold, and the proceeds divided between all the beneficiaries of the estate.
It can be surprisingly difficult to draft clauses to give affect to this desire. Most people who think of drafting their own wills, using a will kit, or some other discount method, overlook the issues of ambiguity and uncertainty. If the language in the will is not clear, then the gift may fail entirely.
Once you understand that problem, you then must tackle a much more subtle legal concept: the condition subsequent. This label refers to a clause attached to the grant of a gift which attempts to limit the gift from being an absolute gift and makes it conditional. Because in conventional drafting it appears after the absolute wording of the gift, and is a condition, it is called the condition subsequent.
What you may not appreciate is that in most circumstances a condition subsequent is held to be void, that is not enforceable, because you cannot limit an absolute gift and if the words of the will are read in the order they are written the condition subsequent takes away something from the absolute gift. So if the clause regarding the home use drafted in one of the not in common ways such as “shall have the right to the occupation, possession and use of my house … for as long as she remains in possession of the said premises,” or “until she is not residing therein personally”, what happens?
First, is the ambiguity problem. What does “possession” mean? What does “residing” mean? The answers may seem simple until you think about fact situations such as someone who resides in one place half the year, and the second the other half. What if the beneficiary takes a two-year contract in the Northwest Territories, but leaves their personal belongings in storage in Thunder Bay? What then if their niece continues to live in the home? Is the answer different if rather than a niece, it is an unrelated tenant renting the home? What if the unrelated tenant rents the home but the basement is used for the storage of the beneficiary’s personal property? What if the beneficiary’s car is left in the garage? There are no simple answers to any of these questions. The courts will often find these clauses to be void for uncertainty, but the cases lack consistency.
The best explanation for this is that Courts will try to give effect to the testator’s intention, but that intention is often hard to identify.
THE CASE
Barsoski Estate v. Wesley is an example of this dilemma.
Diane Barsoski died in June 2017. She and Robert Wesley, the appellant, were close long-term friends although they were never romantic partners. In her will, she was very generous to him. In addition to some other bequests, she provided that the trustees were to hold her home and contents “as a home” for the appellant during his lifetime “or for such shorter period as [he] desires”. It went on to provide that:
Upon the earlier of [the appellant] advising my Trustees that he no longer wishes to live in the House, [the appellant] no longer living in the house, and [the appellant’s] death, the House shall be sold and the proceeds shall be delivered to St. Stephen’s Community House to be used by the highest priority needs as determined by the board of directors.
THE LAW
The Superior Court Judge who initially heard the application determined that the condition subsequent was void. So far, so good for the beneficiary. But the judge then determined that the “gift” was not an absolute gift of a life interest but was only a license to occupy the property. That left Ms. Barsoski’s relatives able to argue that once the friend went to Florida in the winter, the license terminated.
Oops, that resulted in the intention not being fulfilled.
The Ontario Court of Appeal reversed the result. They remind us that rules in this area are meant to be bent where context dictates a result different than the rules might suggest. This is an example of the triumph of equity over law. Law has “rules”. Equity has “principles”. A narrow but important distinction.
A further important discussion in the appeal relates to what we mean by “context”.
The Superior Court judge had counted the fact that Wesley was a friend of the testator, not a spouse or other family member as a reason not to find in Wesley’s favour.
The Court of Appeal was having none of that:
in excluding the appellant’s relationship with Ms. Barsoski from the categories of family members such as spouses or children as in Moore, the application judge relied on and arguably contributed to the perpetuation of a now outmoded and exclusionary view of family. As L’Heureux-Dubé (dissenting) wrote in Canada (Attorney General) v. Mossop, [1993] 1 S.C.R. 554, at p. 634, “[t]he traditional family is not the only family form, and non-traditional family forms may equally advance true family values.” Julien D. Payne and Marilyn A. Payne, the authors of Canadian Family Law, 8th ed. (Toronto: Irwin Law, 2020), point out, at p. 40., “[f]amily relationships can exist when there is neither marriage nor a parent-child ancestral relationship. Unmarried couples of the opposite sex or same sex may be regarded as members of the same family for social or legal purposes.”
[48] … given the uncontested evidence that the testator regarded the appellant as family, there is no reason not to give effect to her choice in this regard. Indeed, testamentary freedom continues to operate as an underlying principle in our law: Spence v. BMO Trust Co. 2016 ONCA 196, 305 D.L.R. (4th) 297, at para. 30. Treating this will differently than it would have been treated had the testator and appellant been romantic partners, spouses or children violates that principle unnecessarily by failing to give effect to the context as the testator saw it.
[emphasis added]
The Court agreed that the condition was void but ruled that what was left was an absolute gift of a life interest, meaning that Wesley had the ongoing right to occupy and use the property.
The bolded phrase caught our eye. It is unclear how a shift away from “a now outmoded and exclusionary view of family” may change the law. In areas such as family law where statutes define what makes up a family, the impact will be minimal. In areas where equity encourages judges to ensure that law evolves, the impact may be dramatic.
TAKEAWAYS
- Drafting must avoid ambiguity or lack of clarity;
- Drafting should closely and clearly reflect testator’s intention;
- Context matters in will interpretation;
- Avoid conditions subsequent;
- Courts are increasingly open to modernize notions such as “family”; and
- The long-term effect of that development is not yet clear.
HOW WEILERS LLP CAN HELP YOU
A professionally prepared will is the best way to make sure your intentions about your estate are clear.
The estate planning lawyers at Weilers LLP are ready to work with your other advisors to prepare a will that reflects a solid estate plan and will withstand challenge. We know and work well with many financial and investment advisors in Thunder Bay and other Northwestern Ontario communities. Our success in those relationships makes us confident that we can work well with your advisors.
If you are a trustee or potential beneficiary affected by a dispute about the will, Weilers LLP can provide a reliable opinion as to the validity. If it is necessary to go to court to determine the issue, the Weilers LLP litigation team works closely with the estate planning team to provide effective advocacy in all types of estate litigation.