Sursa dumneavoastra de Estates si Real Estate Law - How not to save money on estate planning documents
I was recently approached by a business acquaintance who asked me what can be done in the case of a lady who had lost her capacity and who had executed a Power of Attorney for Property (“POA”) while she had capacity. He explained that the client had used a will-making kit, that the POA had been part of this kit, and that the POA had only one witness. The law says that a Power of Attorney which is typed has to have two witnesses to be valid, so automatically, I realized this was not a validly executed document for that reason. What surprised me, however, was that a financial institution did not accept this POA for the reason that it was not executed at a legal office, and not because it was missing a witness.
In retrospect, this is not really that surprising, because I can see why institutions in general are fearful of documents executed conspicuously – first of all, they can be executed incorrectly and second of all, somebody could have influenced the grantor. These problems are more or less eliminated if a lawyer prepares the documents and helps the client execute them.
Unfortunately, I had to tell my acquaintance that the person who wants to step up as a Power of Attorney for Property now has to apply to court for guardianship of property, which is complicated, time consuming and expensive!
I decided to read some case law which addressed situations where the testator executed the documents incorrectly and see how the courts treated them.
BMO Trust v. Cosgrove, 2021 ONSC 5681
The testator left behind a holograph (i.e. handwritten) Codicil accompanying her Will. However, the document was not signed and instead, the testator wrote her name in an attestation clause [A clause stating that a document has been executed in the presence of one or more witnesses]. BMO Trust as agent for the Estate Trustee argued that the Codicil was valid as the testator’s handwritten name appeared twice in the attestation clause, and placement of a signature did not render a Codicil invalid under s.7(2)(c)(i) of the SLRA. One of the respondent beneficiaries argued that while the deceased’s handwriting of her name occurs in various places throughout the handwritten Codicil, the deceased had not fixed intention to sign, or give effect to, the Codicil when she wrote her name in various places, including the attestation clause.
So the question was: did the testator’s handwriting of her name in the attestation clause constitute a “signature” for the purposes of the formalities for executing a Will as set out in the SLRA?
Decision
The holograph Codicil was found not to be a valid testamentary document and could not be admitted to
probate. Justice Dietrich noted that Ontario is still a “strict compliance” jurisdiction and that the formalities of execution of testamentary documents set out under the Succession Law Reform Act (“SLRA”) must be complied with. The SLRA requires that a testator’s signature must appear “at, after, following, under or beside or opposite to the end of the will….”. However, it also provides that a Will is not rendered invalid if the signature is placed among the words of a clause of attestation. Significantly, Justice Dietrich stated that what distinguishes a “signature” from writing out one’s own name in long hand, for the purposes of the case before her, is that “it must be apparent that what is alleged to be the act of signature was specifically intended by the testator to give legal effect to the document. The SLRA specifically requires a “signature” in addition to the wholly handwritten text.”
In this case, the evidence also demonstrated that the holograph Codicil was an unfinished document with certain blanks, including spaces for a signature and date, that the testator intended to sign the document in the presence of witnesses (although not required), that the testator understood that the document needed to be signed in order to be valid and that she advised the Law Society of Ontario that she had a “handwritten codicil (not yet signed)”.
In the result, Justice Dietrich held that the inclusion of the testator’s name twice in the attestation clause did not make it apparent that the Deceased intended to make the holograph Codicil binding. The lack of signature on the document was a defect that could not be remedied.
Re Swiddle Estate, 2021 ONSC 1434
Before Stella Swiddle died, she executed a Primary and Secondary Wills with Codicils. In particular, she executed a Third Codicil on June 23, 2020. The witnesses to the Third Codicil were located in Sudbury, and Stella was located in Mississauga. Stella spoke on the phone with the witnesses as she reviewed and signed the Third Codicil. Stella’s daughters were in the room with Stella as she signed, and the daughters also signed the Third Codicil in the witness sections, apparently to indicate their consent with respect to its contents. The Third Codicil was sent to the witnesses via Purolator the next day and they signed it on the last page. The document was executed in this fashion due to concerns arising from COVID-19.
The question was whether the Third Codicil met the formalities of execution under the SLRA or Ontario Regulation 129/20 which was put in place pursuant to the Emergency Management and Civil Protection Act?
Decision
The Third Codicil did not meet the formalities of execution. The Codicil was not signed in accordance with the requirements of the SLRA that required the testator to make or acknowledge her signature in the presence of two or more attesting witnesses present at the same time and required two or more of the attesting witnesses to subscribe to the testamentary document in the presence of the testator. In addition, the execution of the Codicil did not comply with Ontario Regulation 129/20 which permitted the execution of testamentary documents by means of “audio-visual communication technology” and required that at the time of execution at least one person who was providing services as a witness was a lawyer.
Maybe these people were trying to save money on their estate planning documents by executing them themselves, thinking it is simple enough. However, the law is not only strict but also has evolved a lot during the pandemic and what was once considered ok may not currently be so. Once again, this proves that it doesn’t hurt to have a consultation with a lawyer on such an important topic as all of one’s money.
PLEASE NOTE THAT THE CONTENT OF THIS BLOG IS MERELY FOR INFORMATION PURPOSES AND DOES NOT CONSTITUTE LEGAL ADVICE.
Raluca M. Soica, BBA, CPA, CMA, JD
Barrister & Solicitor
647.280.6497
raluca@rms-law.ca
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Raluca M. Soica 1/13/2022 |
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