Monday, December 09, 2013

The "Simple" Will: Not Always So Simple…

Drafting a simple, uncomplicated will may appear to be a routine task for most legal practitioners in comparison to “flashier” legal matters like messy divorces and high stakes litigation.  

That being said, when a lawyer is called upon to draft a will, he or she must keep in mind that his or her responsibilities encompass an array of interests and issues that may not be initially apparent. As a result, the lawyer will be required to make appropriate inquiries, engage in fact finding, and generally appraise the situation from an informed standpoint.

A lawyer who is drafting a will must take necessary steps to ensure all of the following:
  1. The testator has testamentary capacity;
  2. The testator's expressed wishes are voluntary and informed, and not the result of undue influence or duress imposed by others;
  3. The testator has provided a thorough and accurate inventory of his or her property accompanied by documentation that confirms the client’s authority or ability to dispose of any of the property;
  4. The testator is cognizant of relevant income tax issues and other issues or limitations that may encumber his or her proposed scheme of distribution;
  5.  The testator understands and approves of the contents of the will.
The first requirement – that the client has testamentary capacity – presents many pitfalls and ambiguities.  How can a lawyer know whether a client is has the soundness of mind to deal with estate planning and the testamentary distribution of his or her property? 

The short answer is that, particularly where issues present, the lawyer ought to maintain regular communication with the client in order to be able to assess consistency and testamentary capacity.  

Such communications will also assist in discerning whether any undue influence or duress is affecting the testator’s will.  In the process of drafting the will, a lawyer should ensure that his or her notes are complete, with information to support conclusions in respect of testamentary capacity and the absence of undue influence or duress.

While the lawyer’s assessment of testamentary capacity may be informed by clinicians, including the opinions of physicians and psychologists, testamentary capacity is a legal concept that is ultimately determined by the court. It has been suggested that an assessment of testamentary capacity that is contemporaneous with the execution of the will is the best defence to a potential will challenge.

The test for testamentary capacity was restated in Royal Trust Corp. of Canada v. Saunders, [2006] O.J. No. 2291 (S.C.). According to Justice Blishen, testamentary capacity is established where the testator:

(1)    understands the nature and effect of the will; (2) recollects the nature and extent of his property; (3) understands the extent of what he is giving under the will; (4) remembers the people he might be expected to benefit under his will; and (5) understands the nature of the claims that may be made by persons he is excluding under the will.

A lawyer has a challenge ahead of him or her when the client is lucid at one moment and then appears confused at the next.  What if the client clearly has a drinking problem?  This was the issue in the case of Lata v. Rush, 2012 ONSC 4543 (CanLII). In that case, the will was ultimately upheld despite the testator being referenced in one medical report as a “grossly inadequate personality who has been engaged in heavy drinking of vodka for the last 13 years.”  

Justice Hainey buttressed his decision by stating that there was no evidence that the testator was incompetent or suffered from mental disorders at the time that she executed her new will.  Thus, even a “habitual drunkard” may execute a valid will if she possesses a sound, disposing mind and has the wherewithal to recall the extent or her property and the nature of the claims to which she ought to give effect.  

Alternatively, if the testator shows signs of failing health and diseases of serious cognitive impairment, such as Alzheimer’s or dementia, the courts take a very close look at capacity issues.  The existence of suspicious circumstances automatically rebuts the presumption of capacity with the corollary being that the propounder of a will bears the onus of proving testamentary capacity.  

Hutchison v. Hutchison 2006 CanLII 27233 (ON SC) illustrates this point. The plaintiffs in this case included three of the deceased’s four children who challenged the newest will of the deceased bequeathing the whole of his estate to his youngest son.  The defendants were the youngest child and his wife.  The deceased’s prior will divided his estate equally among his four children. 

The court carefully weighed the evidence in respect of the deceased’s capacity.  At one point, the deceased was found in his car in a state of disorientation while parked on a railroad track.  He moved in with his youngest son shortly after being diagnosed with dementia where he lived under the son 's care until his death. 

The court found that there was sufficient evidence to doubt the deceased’s capacity to create a new will on the basis of his deteriorating health and dependency on the defendants. Accordingly, the onus shifted to the defendants to prove the deceased’s capacity on a balance of probabilities. Ultimately, the court found that the defendants had failed to prove that the deceased had testamentary capacity when he gave instructions for his new will.

Lawyers in such circumstances should make the appropriate inquiries to determine whether the testator was in a position of dependency or otherwise in an especially vulnerable state.  It is also adviseable to procure the expert opinion of health practitioners in light of the serious cognitive impairments that manifest in cases of dementia.  

While this certainly entails extra steps, it is absolutely vital that the lawyer discharge this duty when dealing with elderly clients in order to ensure that the will reflects only true testamentary wishes.

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