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WEL Partners provides litigation, mediation and dispute resolution to clients throughout Ontario:
* Albert Oosterhoff, Professor Emeritus Western University, Counsel to WEL consults on matters within his areas of expertise, providing opinions concerning Wills, Estates, Trusts and related Property matters.
Please Enjoy,
Kimberly A. Whaley & Lionel J. Tupman
WEL Partners
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| 1. WEL WELCOMES ALEXANDER J. SWABUK, LAWYER 
It is with great pleasure that WEL introduces and welcomes our newest associate lawyer, Alexander J. Swabuk who joined WEL PARTNERS on July 4, 2017.
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| 2. THE ADVOCATES QUARTERLY, VOLUME 47, NUMBER 1, JUNE 2017
Congratulations to Andrea Buncic on the publication of her article: "A Review of the Mutual Wills Doctrine: Applicability of the Doctrine and Available Damages for Breach of a Mutual Wills Agreement" which was published in The Advocates Quarterly, June 2017.
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| 3. WEL WELCOMES BACK KATE STEPHENS, ARTICLING STUDENT
WEL looks forward to a great articling experience with Kate.
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| 4. CBA/OBA ELDER LAW EXECUTIVE
Kim is the incoming Chair of the CBA Elder Law and OBA Vice Chair of the newly created branch OBA Elder Law Executive.
Lionel has been elected as an OBA Elder Law Executive Member and as Co-Chair of the CLE, Programming and Estate Committee.
Lionel has also been elected as Member at Large in OBA Estates and Trusts Executive.
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| 5. ARIEH BLOOM PUBLICATION
Arieh will be published in the Annual Review of Civil Litigation concerning his article: "The Case for Probate Not Just a Tax" reflecting on the advantages of probate in the litigation context, as well as an apology for probate and why the tax tail shouldn't wag the fiduciary dog.
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| 6. 3rd ANNUAL JOHN CRESSWELL CLASSIC GOLF TOURNAMENT, JULY 17, 2017
Lawyers at WEL Partners took to the Richmond Hill Golf Club to don their purple golf shirts and team up at the 3rd annual John Cresswell Classic Golf Tournament, in support of the Sunnybrook Foundation for Cancer Research. WEL Partners would like to give a warm thanks to John Clegg from Scotia Wealth Management for the invitation.
Special mention goes to Deb Stephens who won awards for women's longest drive and closest to the pin/flag.
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(i) A CLEAR CASE OF ELDER ABUSE
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by Kathryn Morris
Justice Mulligan of the Ontario Court of Superior Justice recently released his reasons in the matter of Danilova v Nikityuk, which he described as a "clear case of elder abuse".
[1]
FACTS
The defendants in the action were an elderly Russian couple (the "Defendants"), who were sponsored to immigrate to Canada by the wife's daughter and her husband (the "Plaintiffs"). The elderly Russian couple began to contemplate and discuss immigration with their daughter and son-in-law in 2004 which led to the parties signing a Sponsorship Agreement (the "Agreement") which sets out the parties' obligations to what is now the Department of Immigration, Refugees and Citizenship Canada ("IRCC").
[2]
The Agreement, which remained in effect for a ten year period upon the couple's arrival in Canada,[3] took effect in 2008. The couple's decision to immigrate was precipitated by an "inducement e-mail" (the "E-mail") sent to them by their son-in-law in January 2008.[4] The E-mail contained budget projections for their new life in Canada and constituted an offer from the daughter and son-in-law which the couple accepted.[5] The offer constituted of the couple's liquidated assets, estimated at CAD$200,000, to be placed into a bank account that would accumulate 10% interest per year. This E-mail Offer would allow the Defendants to live in a one bedroom apartment and would cover the majority of their expenses, with minimal support from the Plaintiffs.
The Agreement stated that due to the Defendants' ages, they were not expected to look for a job or care for themselves.[6] The Agreement further stipulated that the Plaintiffs would be in breach of the Agreement as it related to their obligations to IRCC if the Defendants became reliant on social assistance during the life of the Agreement.[7] The Plaintiffs did not disclose this consequence to the Defendants.
The Defendants, who spoke no English, placed their trust in the Plaintiffs when it came to their money and sponsorship to Canada. Just prior to their immigration to Canada, the Defendants liquidated their assets and sent CAD$260,842.71 (the "brought capital") to their daughter, as per the E-mail.[8] Upon receipt of the funds, the son-in-law proceeded to invest all of the Defendants' life savings in the stock market, which he lost a few days later as a result of a stock market decline. He did he not discuss with the Defendants that he intended to invest their money in the stock market, and he did not notify them of their loss.
[9]
Upon their arrival in Canada, the Defendants' finances were controlled, managed and overseen by their daughter, who took them to a Russian-speaking lawyer where they executed general Powers of Attorney in her favour.[10] The Plaintiffs gave the Defendants credit cards for their use, but the Defendants' daughter required them to give her two days' notice if they wanted to withdraw cash from the account that received their Russian pensions. Additionally, in order to assist with an audit he was undergoing by CRA in 2009, the son-in-law had the elderly couple sign a "loan agreement" which indicated that the brought capital was a loan, despite the capital already having been lost.[11] The audit was prompted by his use of the interest on the Defendants' loan and the stock market losses to generate tax losses.
[12
]
Shortly after their arrival in Canada, the Defendants moved into a home (the "Home") that they believed to be purchased by the Plaintiffs with the money they had sent from Russia, and that they believed they owned.[13] In reality, only $51,640 of their money was put towards the down payment, while the remainder was financed by a mortgage taken out by the Plaintiffs.[14] Another $15,000 from the couples' liquidated Russian bank accounts that they brought with them when they entered Canada, was used to furnish the Home.
[15]
Approximately one year later, the Plaintiffs moved into the Home with the Defendants because they could not afford to support the Defendants and themselves on the son-in-law's salary alone. While the parties' relationship remained strong for some time, it ultimately deteriorated and resulted in the Defendants moving out on October 17, 2011, and into social housing based on allegations of elder abuse.
[16
]
By October 17, 2011, the Defendants had developed a safety plan and had been pre-approved for social housing. They achieved this with the help of a settlement counsellor at their local YMCA, whom they met through their participation in an ESL course there.
In this action, the Plaintiffs made out claims of defamation, inducing breach of contract (the Agreement), negligence and conspiracy against the elderly couple, the YMCA and the settlement counsellor. In response, the elderly couple counterclaimed against the Plaintiffs for damages for fraud and misrepresentation, conversion, unjust enrichment, breach of contract and for breach of fiduciary duty.
REASONS
In reviewing the evidence before him, Justice Mulligan determined that the Plaintiffs failed to demonstrate any of the claims they advanced on a balance of probabilities and as a result, the court dismissed all of the claims against the elderly couple, the settlement counsellor and the YMCA.
In addressing the Plaintiffs' claims, the court held that the elderly couple Defendants had not breached the Agreement, as they were entitled to seek social assistance in the event of abuse. The court went even further in addressing the Defendants' counter-claims and held that, in fact, the Plaintiffs had breached the Agreement. Justice Mulligan found that this occurred in two ways: 1) the Plaintiffs failed to honour their offer to provide 10% annual interest on their brought capital to balance their budget, which had been accepted by the elderly couple; and 2) the actions of the Plaintiffs' caused the breach of the contract.
[17]
In addressing the remainder of the elderly couple Defendants' counter-claims, the court commendably employed several equitable doctrines in order to grant them significant relief.
In terms of the brought capital, the court found that the doctrine of resulting trust applied. Contrary to the allegations of the Plaintiffs-that the money represented a gift-the court agreed with the Defendants that the transferred sum was a loan pursuant to the Agreement and E-mail.
The court also held that the Defendants were entitled based on a constructive trust claim against the Home to $66,640, in respect of their money that was used for the down-payment and to furnish the house.
Moreover, the court held that in receiving the elderly couples' brought capital, in using part of the funds to purchase a house in their own name, in preparing a loan agreement after the funds were no longer available to support such a loan, in acting as their Power of Attorney for their monthly pensions, and in preparing and filing tax returns on their behalf, the Plaintiffs assumed the role of fiduciaries to the elderly couple. Justice Mulligan found that this duty was breached by the Plaintiffs in using the Defendants' funds for their own benefit.[18] Additionally, the court found that the Plaintiffs had committed civil fraud in making the false representation that the elderly couple's capital could earn 10% per year.
[19
]
With that, the court awarded the Defendants $210,678, plus the $66,640 constructive trust award against the Home, for a total sum of $277,318 representing their brought capital. The court awarded $97,321 signifying the promised 10% interest on their brought capital, less the amount of support paid by the Plaintiffs after the Defendants moved out. Additionally, Justice Mulligan awarded the elderly couple $25,000 in punitive damages. The court has yet to receive cost submissions from the parties.
[20
]
The particularly notable aspect of this case is Justice Mulligan's reasons for awarding $25,000 in punitive damages against the Plaintiffs. He expressly condemned their "reprehensible conduct [that] deserves to deter not only [the Plaintiffs], but others who may consider similar misconduct in the future if they gain control of the finances of elderly and vulnerable people"[21].
The court additionally commented that the elderly couple "[was] financially abused from the time they arrived in Canada. They wanted to live separately. That was the plan in the inducement e-mail. Social housing was not their first choice, but it seemed to them that it became their only choice. The [Plaintiffs] discouraged any talk of social housing and for good reason. They knew that if the [Defendants] moved into social housing, it would constitute a breach of the Agreement with the Government of Canada. The continual discussion about moving out and social housing became an irritant and led to emotional arguments. I am satisfied that there was a physical altercation as well...But even if I am wrong on that finding, it is clear that financial and emotional abuse had already occurred."
[22
]
CONCLUSION
The court's condemnation of the elder abuse that occurred in this case and Justice Mulligan's use of contract, tort and equitable law doctrines to provide the Defendants with relief represents a step forward in the protection of the elderly who are vulnerable to abuse. Hopefully, this case will act as an incentive for the elderly and vulnerable who are victims of abuse to seek relief in civil courts.
[1]
Danilova et al v Nikityuk et al, 2017 ONSC 4016 at para 206 [Danilova].
[2]
Citizenship and Immigration Canada (CIC) was rebranded as Immigration, Refugees and Citizenship Canada (IRCC) in November, 2015.
[3]
Danilova, supra note 1at para 30.
[4]
Ibid at paras 22, 28.
[13]
Ibid at paras 55, 73, 75.
[15]
Ibid at paras 21, 69.
[16]
Ibid at para 81, 98.
[20]
Ibid at paras 208-210.
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(ii) THE ALL FAMILIES ARE EQUAL ACT: POTENTIAL AND PROMISE- MODERNIZING THE FAMILY
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by Alexander J. Swabuk
As previously discussed in a prior WEL Blog "Who's your daddy? Proposed changes to Ontario laws regarding parentage," [1] the Ontario Legislature has recently made significant changes to the Children's Law Reform Act [2], the Succession Law Reform Act [3] and 38 other Ontario Acts through the passing of Bill 28, the All Families Are Equal Act (the "Act"). Bill 28 was introduced to ensure the equal treatment of all parents and children in the province of Ontario. It was also a direct response to a number of court challenges, developments in reproductive technology, as well as societal changes to the notion of what constitutes a "modern Canadian family". As a cautionary note, lawyers practicing in Ontario should be aware that certain aspects of the Act were designed to apply retroactively.
The Act received Royal Assent on December 5, 2016 and officially came into force on January 1, 2017. The Act recognized the legal status of all parents, whether they are LGBTQ2+ or heterosexual, and whether their children were conceived with or without reproductive assistance. The Act amended various pieces of legislation to use gender neutral terminology and marks the first time Ontario's parentage laws have been updated since 1978.
The Act made a number of changes to the Children's Law Reform Act including:
- The elimination of the assumption that a child has no more than two parents;
- The term "parent" replaces the terms "mother" and "father";
- All references to persons being "natural parents" of a child and to persons being related "by blood" are now removed;
- Four people can now agree, in writing, to be the parents of a child;
- Up to four "intended parents" can now agree to enter into a "surrogacy agreement" with a surrogate, who agrees to relinquish entitlement to parentage after the child is seven days old;
- A child's birth parent is now a parent unless that person is a surrogate and is determined not to be a parent;
- The person whose sperm resulted in conception through sexual intercourse is a parent unless the parties agreed in writing in advance that that person does not intend to be a parent; and
- The spouse of a birth parent of a child conceived through assisted reproduction/sperm donation is presumed to be a parent.
From an estate administration perspective, the All Families Are Equal Act has also made significant amendment to the Succession Law Reform Act ("SLRA") which governs testate and intestate succession in Ontario. The definition of "child" and "issue" within the SLRA has subsequently been expanded to now include a child who is conceived and born alive after the parent's death, provided certain conditions are met. The specified conditions are set out in a new subsection 1.1 entitled "Posthumous conception conditions". One of the conditions is that the person who, at the time of the death of the deceased person was his or her spouse, must provide written notice to the Estate Registrar for Ontario that the person may use reproductive material, or an embryo to attempt to conceive, through assisted reproduction and with or without a surrogate, a child in relation to which the deceased person intended to be a parent. Written notice must be provided no later than six months after the deceased person's death. Another condition is that the posthumously-conceived child must be born no later than the third anniversary of the deceased person's death (unless otherwise specified by the Superior Court of Justice by way of an order).
Section 47(10) of the SLRA, which governs intestate succession to descendants posthumously conceived, has also been amended to provide that descendants and relatives of the deceased conceived and born alive after the death of the deceased shall inherit as if they had been born in the lifetime of the deceased and had survived him or her, subject to the conditions set out in subsection 1.1. As per section 47(11) of the SLRA, this right of a descendant or relative begins on the day he or she is born. Additionally, Sections 57 and 59 of the SLRA regarding dependant support have also been amended, so that an applicant for dependant support can now include a child of the deceased who was conceived and born alive after the death of the deceased, if the application is made no later than six months after the death of the deceased.
The All Families Are Equal Act marks an important step in the right direction for Ontario, as legislation that explicitly addresses conception through assisted reproductive technologies and third party arrangements has finally been passed. This shift towards inclusiveness and ensured equality, regardless of one's sexual orientation or reproductive capacity, addresses legal discrimination based on family status. As such, many parents and children with "non-traditional" family structures or family building processes are now protected.
[2]
R.S.O. 1990, c. C.12.
[3]
R.S.O. 1990, c. S. 26.
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(iii) DID THE SUPERIOR COURT EXPAND THE DOCTRINE OF DONATIO MORTIS CAUSA TO APPLY TO REAL PROPERTY?
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Altman v. Nicholson Estate
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2017 ONSC 2566 (CanLII)
by Kathryn Morris
Altman v Nicholson Estate
, 2017 ONSC 2566 is a decision of the Honourable Justice Tranmer on a motion to determine a question of law raised by the Plaintiffs' Statement of Claim under Rule 21.01(1)(a)[1] with respect to a gift mortis causa.[2] The Defendants submitted that the Statement of Claim did not disclose a cause of action that would support the relief sought by the Plaintiffs.
The dispute at issue between the parties was related to the rightful ownership of cottage land that was held by the deceased. The Plaintiffs argued that pursuant to section 10 of the Statute of Frauds, the cottage property was rightfully theirs by virtue of the doctrines of proprietary estoppel, donatio mortis causa or constructive trust. The Defendants, on the other hand, held that the property at issue remained within the estate of the deceased, and in the absence of evidence in support of proprietary estoppel and constructive trust, and based on evidence in support of the absence of a gift mortis causa, the court ought to determine the issue of the property ownership before trial.
In his decision, Justice Tranmer agreed with the Defendants that the Statement of Claim did not plead trust, proprietary estoppel, unjust enrichment or detrimental reliance. With regards to the issue of whether the cottage was a gift mortis causa, the court found that the evidence which supported the Defendants' contention was found in the Statement of Claim, which plead that the deceased decided that she could not or would not convey the property at issue because of a capital gains tax liability.
In order for a gift mortis causa to be valid, three requirements must be met.[3] First, the gift must be made in contemplation, but not necessarily in the expectation, of the donor's death. Second, the gift must be delivered to the donee, although constructive delivery is permitted in appropriate circumstances. Finally, the gift is dependent on the donor's death, and can thus be revoked by the donor at any time, while he or she is alive.
The Honourable Justice Tranmer found that, based on the fact that the deceased did not wish to convey the cottage property, the property was not the subject of a valid gift mortis causa. Justice Tranmer, therefore, concluded that it was plain, obvious and beyond doubt that the claim set out in the Statement of Claim could not succeed[4], and he thus granted the relief sought by the Defendants, pursuant to Rule 21.01(1)(a).
This case is particularly interesting in that it appears to diverge from the line of cases that suggest that the doctrine of donatio mortis causa does not apply in the context of real estate.[5] For example, in Snitzler v Snitzler, the court summarized the case law with respect to the doctrine and its application to real estate, and found that real property is not properly the subject of a gift mortis causa because any conditional intent can be both determined and recorded in an enforceable manner.[6] As Justice Tranmer's only enumerated reason for determining that the cottage property was not the subject of a valid donatio mortis causa was that the deceased did not wish to convey the property for tax reasons, it is unclear whether Justice Tranmer was of the view that the doctrine applies to real property. Thus, it is uncertain if, in the future, this doctrine could be used to determine the validity of a gift consisting of real estate.
[1]
Rules of Civil Procedure, RRO 1990, Reg 194, r 21.01(1)(a): "A party may move before a judge, (a) for the determination, before trial, of a question of law raised by a pleading in an action where the determination of the question may dispose of all or part of the action, substantially shorten the trial or result in a substantial saving of costs, and the judge may make an order or grant judgment accordingly."
[2]
A donatio mortis causa is gift in contemplation of death.
[3]
Albert H Oosterhoff et al, Oosterhoff on Wills, 8th ed (Toronto: Thomson Reuters/Carswell, 2016), 166.
[4]
Elbaum v York Condominium Corp No 67 2014 ONSC 1182 at para 14, 238 ACWS (3d) 1055.
[5]
Snitzler v Snitzler, 2015 ONSC 2539, 254 ACWS (3d) 226; Sorenson's Estate v Sorenson, 1977 CanLII 1648, 90 DLR (3d) 26 (Alta CA); Danicki v Danicki, [1995] OJ No 3995, 1995 CarswellOnt 3630 (Ont Ct J (Gen Div)).
[6]
Snitzler v Snitzler, 2015 ONSC 2539 at para 26, 254 ACWS (3d) 226.
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PART III: UPCOMING EVENTS
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LSUC, Estates Administration
September 29, 2017
Co-Chair: Kimberly Whaley and Tim Grieve
Speaker: Professor Albert Oosterhoff
Toronto Police Seniors Presentation
October 3, 2017
Speaker: Kimberly Whaley and Amanda Bettencourt
Toronto Police Seminar
Elder Abuse
October 6, 2017
Speaker: Kimberly Whaley, Lionel Tupman
STEP Toronto
Elder Abuse
October 18, 2017
Speaker: Kimberly Whaley and Professor Albert Oosterhoff
Advocis, The Financial Advisors Association of Canada
Dealing with Older Clients
October 20, 2017
Speaker: Kimberly Whaley
Ontario Police Seminar
October 2017 (TBC)
Speaker: Kimberly Whaley
CCEL BC
Independent Legal Advice: The Interplay of where Capacity and Undue Influence
November 2-3, 2017
Speaking: Kimberly Whaley
CBA Nova Scotia
November 30-December 1
Speaker: Kimberly Whaley
Osgoode Intensive Program in Wills & Estate
Passing of Accounts and Fiduciary Accounts
February 13, 2018
Speakers: Kimberly Whaley, Lionel Tupman, and Professor Oosterhoff
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PART IV: RECENT BLOG POSTS
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