The recent Saskatchewan King’s Bench decision in Gilchrist v Gilchrist, 2023 SKKB 187 offers a reminder of the importance of updating your will. If you do not update your will, and certain beneficiaries named in your will have died before you, the legal outcome may be one that does not reflect your intentions.

Factual background:

1. Dawn Jacqueline Gilchrist (the “Deceased”) died on August 18, 2022;
2. The issue in Gilchrist was whether or not the Deceased’s estranged brother, William, should receive any share of the Deceased’s Estate under the Intestate Succession Act, 2019, SS 2019, c I-13.2 (“Act”);
3. The Deceased had died with three surviving siblings – Glendon Gilchrist (“Glendon”), Lorraine Gilchrist (“Lorraine”) and William Gilchrist (“William”);
4. However, in the mid-1990s, William was convicted of having indecently assaulted the Deceased while she was a minor. William denied then, and he denied now, that he had indecently assaulted the Deceased;
5. That said, there did appear to be evidence that the Deceased did not intend to give any of her Estate to William. The Deceased’s executor, Glendon Gilchrist (“Glendon”) pointed to the sexual assault conviction. Furthermore, the Deceased had had no contact with William during her adult life. The Deceased had conducted herself as though William did not exist. In contrast, she did remain in a relationship with her other two siblings – Glendon and Lorraine (who were also explicitly named in her will);
6. Moreover, there was evidence that, in the days before she died, Lorraine and the Deceased had discussed the prospect of the Deceased amending her will to reflect the fact that their parents had already died. Lorraine says that on August 17, 2022, the Deceased asked her to have a lawyer come to the hospital so that the Deceased could amend her will to leave her estate to Glendon and Lorraine. Lorraine arranged for a lawyer to attend at the hospital on August 18, 2022, but the Deceased died in the early morning of that day;
7. Lorraine provided evidence that that “It was clear from my discussions with the Deceased that she had no idea that any law existed that could cause part of her estate to go to William because her parents were named in the Will and were deceased;”
8. Given this background, Glendon, as executor, applied for an order that the residue of the Deceased’s estate (“Estate”) be divided equally between him and Lorraine Gilchrist, with no part going to William Gilchrist.

Will left by the Deceased:

To place the decision in Gilchrist in context, we must understand the will left by the Deceased and understand what the intestacy regime is:

1. On March 8, 1991 the Deceased executed a will (“1991 Will”). It had been prepared by a Saskatoon lawyer. In the 1991 Will, the Deceased provided specific bequests to Glendon and Lorraine. She then provided that the residue of her Estate (i.e. what was left over) would go to her parents. William was not among the beneficiaries named in the will.
2. As it turned out, the Deceased’s parents died before she did. Her father, John, died on May 19, 1995. The Deceased mother, Elsie, died on December 9, 2016;
3. The Deceased did not amend her will or replace it with another at any time after executing her will in 1991. It is undisputed that when she died on August 18, 2022, the Deceased’s gift of the residue of her Estate to her parents had lapsed, as both parents had predeceased her. In law, when a testamentary gift is given to someone, but then that person has died before the gift takes effect, the gift generally lapses into intestacy (subject to a few exceptions which did not operate here);
4. Intestacy refers to a situation in which a specific estate property is not specifically distributed under a will. In such cases, such property is to be distributed under the direction provided by Intestate Succession Act, 2019, SS 2019, c I-13.2;
5. This Act provides for a series of classes (classes of family members of the deceased) who have various levels of priority to take the intestate property. These rights apply by operation of law, and do not depend on whether or not the deceased actually wanted them to receive any property. Many non-lawyers may not even know the details of the Act and not even be aware that such laws may affect their estate property after their death;
6. Again, it must be noted that the Act and its regime can be opted out of. All someone needs to do is to have a valid will which specifies where the property is to go. It is only in cases where the will is silent that the Act comes into play;
7. Here, the Act provided that where someone dies with no children or parents having survived them, any undistributed estate property goes to the siblings. The Act had no exception for a situation in which one surviving sibling had been convicted of an offence against the testator (although such an exception may be a good idea for future law reform);
8. As such, when the Deceased in Gilchrist died, it appears that s. 8 of the Act operated to cause the residue of her Estate to go in equal shares to her surviving siblings, Glendon, Lorraine and William.

Issue:

Against this background, Glendon argued that the residue of the Estate should be distributed to only Glendon and Lorraine, with none of it going to William. Glendon asserts that it would be contrary to the Deceased’s testamentary intention for any part of her Estate to go to William.

Findings by the Court:

Before turning to the outcome in Gilchrist, we survey what principles govern the interpretation of a will.

What information does a Court consider when interpreting a Will?

Typically, most wills are clearly written and can be plainly interpreted. Where a will is unambiguous, routinely courts interpret the will without reference to any other extraneous information outside the four corners of the will.

If however a phrase in a will is ambiguous, there may be a need to go beyond the testator’s written words, and into surrounding facts. This can help to ascertain and implement the testator’s testamentary intention.

Again, however, where a will is not ambiguous, a Court should not look to extraneous evidence outside the four corners of the will.

A Court cannot speculate as to what a testator would have intended to write in their Will, had they turned their mind to a hypothetical situation:

In Gilchrist, the Court ultimately concluded that Saskatchewan law only permits a judge to interpret the existing words used in a Will. The Court cited the below from prior caselaw:

20 The court’s only objective in interpreting a will is to ascertain and give effect to the intention of the testator, as expressed by the language of the will, at the time the will was executed.^[1]

[emphasis added.]

Glendon was able to locate a prior Ontario decision – Frohlich Estate v. Wedekind, 2012 ONSC 3775 – in which an Ontario court had concluded that it was appropriate to speculate as to what a testator would have intended had she turned her mind to a particular circumstance. In Frohlich, the court concluded that the deceased would not have intended to give a lapsed share of her estate to her family (the family were virtual strangers to the deceased). Rather, she would have intended to give it to the other named residuary beneficiaries in her will. The court in Frohlich reached this conclusion despite the fact that the will simply did not contain any ambiguity – it was clear that the residual portion had lapsed, and thus fell into the statutory intestacy regime.

The outcome in Frohlich was likely morally fair – as it reflected what the deceased likely intended but had failed to provide for, by taking timely steps to update her will. The Court in Gilchrist felt however that such an approach was not the law in Saskatchewan.  Gilchrist reaffirmed that in Saskatchewan, a Court must interpret the words that the testator chose to use. The Court was not allowed to speculate on what a testator might have done had they considered a certain situation. The Court wrote:

[28]        Glendon accurately identifies Frohlichas a case in which the court determined what would have been the testator’s testamentary intention if she had turned her mind to a particular circumstance, and if she then had addressed that circumstance in her will. With respect, though, I am not persuaded that the armchair rule has evolved to empower a court to do so.

Outcome in Gilchrist:

Ultimately, the Court held that the residue fell under the intestacy regime of the Act, and therefore went to Glendon, Lorraine and William.

The Court held that it was not permitted to speculate as to what the Deceased would have intended if she had turned her mind to the prospect of her parents dying before she died. Such was not the proper task of the Court. The Court’s proper task was simply to ascertain and give effect to the testator’s intention, as expressed by the existing language of the will.

In this situation, the existing language was clear – there were no alternate residual beneficiaries set out by the Deceased. The Deceased had simply not turned her mind to the possibility of who should receive her residue in the event her parents predeceased her:

26   On March 8, 1991 Dawn did not turn her mind to the prospect of her parents dying before she died, and so when she executed her will on that day she had no testamentary intention in that regard. There is no testamentary intention, relating to an alternate residual beneficiary, for the court to ascertain.

Finally, the Court held that even if the Court had been prepared to speculate as to what the Deceased would have intended in this situation, the evidence available was not sufficient to lead the Court to a certain and definite conclusion as to who would have been named (as of 1991, the date of the Will) as the residual beneficiaries:

32 …The evidence that is before me, though, is not sufficient to support the conclusion that on March 8, 1991 Dawn would have intended to name Glendon and Lorraine as residual beneficiaries. While they were named beneficiaries of specific bequests at that time, there may have been others in Dawn’s life in 1991 that she would have considered as residual beneficiaries. The evidence does not establish who, if anyone, Dawn would have chosen as an alternate residual beneficiary in 1991.

Costs order in Gilchrist:

The Court in Gilchrist did however order that both sides would have their solicitor-client costs (i.e. their dollar for dollar legal costs) paid out of the Estate. This meant that the losing party did not have to bear their own costs, or pay costs to the other side.

The Court held that the general rule of costs in estate litigation involving the interpretation of wills, is that the parties’ costs are to be paid out of the estate. This approach ensures that the will is interpreted in a manner that accurately reflects the intention of the testator.

Lessons offered by Gilchrist:

• Thus, in light of Gilchrist, lawyers are reminded that a Saskatchewan court will confine its interpretative exercise to the written words actually used in a will. It appears that a Saskatchewan court will not go on to (like the Ontario decision in Frohlich) speculate as to what the testator would have intended had they turned their mind to a given situation.

The practical lesson of Gilchrist is that people need to update their wills. If they do not do so, they risk a very harsh result. A court is not permitted to make a fresh will for a testator merely because the testator failed to take steps to update their will.

Intestacy regimes – which provides an order of who is entitled to intestate estate – are statuary tools. The intestacy regime we have is beneficial in that its brings stability to those situations in which the testator has not left direction for given property. While this can cause unintended results, and unfair outcomes, such are an unavoidable necessary side-effect of the law’s need for predictable and certainty. Without intestate legislation, the law would be forced to enter a slippery slope, of trying to speculate what a deceased person intended. Such situations would invite much litigation, with attendant cost and delay. Moreover, the court would still not be sure of always getting it right (because the testator, after all, is not here to testify as to what they truly intended).

The way to avoid the harsh results of intestacy legislation is to take matters into your own hands, and ensure that your will reflects your wishes. You must ensure that it accounts for potential scenarios in which some of your beneficiaries may die before you.

^[1] Citing Ellingson v Ellingson, 2017 SKQB 14 at para 20, 23 ETR (4th) 221 at para 20.

The recent Saskatchewan King’s Bench decision in Gibb Estate (Re), is an example of the Court’s ability to render a document effective as a testamentary document, even if said document was executed without all the formal requirements of the Wills Act, 1996.

Factual background:

1. This matter concerned the Estate of William George Gibb (“Deceased”).
2. The Deceased had died on April 28, 2022. He had left a will executed June 29, 2018 (“Will”).
3. The Executrix, Leora Harlingten, from North Battleford, was one of two stepdaughters of the Deceased. The other stepdaughter was Helen Sawatsky of Saskatoon. They are named in the Will as the residual beneficiaries, to each receive an equal share of the Estate.
4. Paragraph 11 of the Will referred to the Deceased’s intention to create an attachment which would speak to his wishes for certain specific gifts. The Will said:
   11. I give specific gifts as are identified on attachment “A”, attached to my Last Will and Testament and such attachment is incorporated and is part of this Last Will and Testament.
5. The Deceased had left two different documents as “attachments” to his Will.
6. The issue before the Court was which of the two documents was the valid attachment to the Deceased’s Will, for the purpose of admitting the documents for probat

1. The original document (“Original Attachment”) attached to the Will did not make any reference to any specific bequest to Jessica Shaw (“Ms. Shaw”);
2. The Subsequent Attachment added a specific bequest of $20,000.00 to be given to “Jessi Shaw … the administrator of RBM the company I work for at the time of this writing.” 

7. In other words, the key practical difference was whether a bequest of $20,000 would go to Ms. Shaw, or not.
8. Shaw provided the below evidence:

1. That she had met the Deceased in early 2019 when she began working at RBM Architecture Inc. in Saskatoon where the Deceased worked. The Deceased became close to Ms. Shaw and her family, spending Christmases and special occasions together;
2. That while he was dying in hospital, the Deceased asked Ms. Shaw to retrieve and keep a binder of important documents from his house, which included his will and the attachment providing the $20,000 bequest to her. As well, the binder included email exchanges between the Deceased and Adsit.

9. After the Deceased’s death, Shaw handed the binder over to the Executrix. About a month later, Ms. Shaw received a letter from the Executrix’s lawyer demanding that monies the Deceased gifted to her be repaid. Ms. Shaw also learned that the Executrix was taking issue with the Deceased’s bequest to her of $20,000.
10. Melissa Widger (“Widger”), the daughter of the Deceased’s step-daughter, Helen Sawatsky, filed an affidavit in support of Ms. Shaw’s position. Widger recounted that the Executrix contacted her on March 27, 2022, to advise that the Deceased was diagnosed with cancer. The Executrix also told Widger that she was concerned that the Deceased had appointed Shaw his power of attorney and that he had changed his will.
11. The Deceased had also sent a November 23, 2020 email to his lawyer, Ms. Adsit, saying the below:

Hi Marilyn

Hope you are keeping safe.

Our entire office is working from home.

A definite different way to live.

I have attached a revised list to be attached to my will.

I have added Jessi to receive cash.

Please indicate receipt of this e‑mail.

If you have any questions call or e‑mail.

Thank‑you

William George Gibb 

Issue:

The issue was whether the Subsequent Attachment complied with s. 37 of the Wills Act, 1996, and should be given effect to as a testamentary instrument. If such document was a valid testamentary instrument, then the gift of $20,000 would go to Ms. Shaw.

Findings by the Court:

1. Was the Subsequent Attachment testamentary under s. 37?

Under s. 37 of the Wills Act, 1996, a court has the power to hold that a document that was not executed with all due formalities, is still valid if it embodies the testamentary intention of the deceased:

37 The court may, notwithstanding that a document or writing was not executed in compliance with all the formal requirements imposed by this Act, order that the document or writing be fully effective as though it had been properly executed as the will of the deceased or as the revocation, alteration or revival of the will of the deceased or of the testamentary intention embodied in that other document, where a court, on application, is satisfied that the document or writing embodies:

1. 1. the testamentary intentions of a deceased; or
   2. the intention of a deceased to revoke, alter or revive a will of the deceased or the testamentary intentions of the deceased embodied in a document other than a will.

For a document to be considered testamentary under s. 27, a Court must apply the following test: Did the document represent the fixed and final expression of intention of the deceased, as to the disposal of their property on death?

The Court in Gibb Estate determined that the Subsequent Attachment of November 23, 2020 was indeed testamentary. It set out a deliberate expression of the Deceased’s intention to dispose of his property by including the specific bequest to Ms. Shaw. The Subsequent Attachment thus met all the criteria required by s. 37.

2. Was the Subsequent Attachment actually created by the Deceased:

There was another raised by the Executrix. The Executrix submitted that Ms. Shaw had failed to prove that the Subsequent Attachment was actually made by the Deceased, and sent to Adsit from his own email account.

The Court ultimately found that the Deceased had clearly made the Subsequent Attachment. The Court noted the below facts:

1. Ms. Shaw stated in her affidavit that she did not have access to the Deceased’s work email. Only the Deceased and the owner of RBM Architecture Inc. would have had access to the Deceased’s email;
2. Widger’s affidavit evidence also supports the fact that it was the Deceased who sent the email to Adsit. The Deceased’s told Widger in April 2022 that he had added Shaw to his Will;
3. Moreover, the Court took notice that the Executrix had the full legal right to ask Ms. Adsit, in her role as counsel for he Deceased, to provide any evidence to suggest that the Subsequent Attachment did not come from the Deceased. The Executrix did not however obtain such evidence. The Court drew an adverse inference from this absence of evidence:

[26]    Adsit could have cleared up the issue as to whether she received the Subsequent Attachment from Gibb and knew it to be the document sent to her from Gibb. With no evidence filed by the Executrix on that matter, I must draw the adverse inference that the evidence on this point is clear. That is, Adsit received her instructions from Gibb. Shaw has proven on the balance of probabilities that the Subsequent Attachment setting out the specific bequest to her did indeed emanate from Gibb’s email.

Conclusion:

The Court held that Ms. Shaw had proven that the will with the Subsequent Attachment constituted the last will and testament of the Deceased to be admitted for probate.

The Court also made an order that Ms. Shaw should receive her solicitor and client costs, to cover her legal fees that she had incurred in this application. Such would be paid from the Estate assets:

[28]       Shaw seeks an order that her costs of this application be paid, on a solicitor‑client basis, out of the Estate…

[29]        I agree that Shaw’s costs should be awarded to her on a solicitor‑client basis. There was no dispute as to Gibb’s intention when he made the Subsequent Attachment. The Executrix’s allegation that it was not a document prepared by Gibb was completely unsupported in the evidence. Therefore, Shaw is awarded costs on a solicitor‑client basis, payable out of the Estate.

In making the above costs order, the Court referred to certain Saskatchewan case law which held that the “general rule of costs in estate litigation involving the interpretation of wills is that the parties’ costs are to be paid out of the estate.”

The practical effect of this costs order is significant. For context, the vast majority of all civil litigation in Saskatchewan, results only in partial costs orders for the winner. In other words, the winner is typically only awarded a very partial amount of costs from the other side. This means that the winner still is out of pocket to a large degree, in paying the legal fees of their own lawyers. This dilutes their final financial outcome, even if they win.

Here, the costs order above meant that Ms. Shaw would not be out of pocket for her legal fees, incurred in obtaining the ruling in her favor. It also meant that the Estate residual beneficiaries would have their residual property reduced by the amount of Ms. Shaw’s legal fees. Such costs order are still relatively common in Saskatchewan estate litigation, and show the unique way in which Courts continue to approach costs orders in estate litigation, as compared to general civil litigation.

The recent Saskatchewan Court of Appeal decision in Klaptchuk v Johnson is a reminder of the principle of devastavit, which forbids an executor from distributing estate assets in disregard of a creditor’s outstanding claim against the estate. 

That said, Klaptchuk also reminds us that an executor who is sued in devastavit, is entitled to obtain a ruling as to whether they should be relieved from liability (under s. 45 of the Trustee Act), if they erred but had nevertheless acted honestly. Moreover, Klaptchuk also reminds us that there must be clear evidence of what value existed in the estate, before a court should summarily determine (on affidavit evidence) that a devastavit has in fact occurred.

Factual background:

Klaptchuk arose out of an appeal brought by Sylvia Klaptchuk (“Ms. Klaptchuk”) and the Estate of Peter Klaptchuk (“Estate”) against the decision of a judge of (what was then) the Court of Queen’s Bench. The Chambers Decision had granted summary judgment in favour of certain judgment creditors (the “Judgment Creditors”), and had held that Ms. Klaptchuk was personally liable to such creditors for an unsatisfied judgment they had previously obtained against the Estate.

Some of the material facts included the below:

1. Peter Klaptchuk was the sole director, officer, and shareholder of two corporations: Ozonator Industries Ltd. (“Ozonator”) and Peter’s Sewer Service Ltd. (“PSS”);
2. On March 9, 2017, the Judgment Creditors obtained judgment in a civil action against Mr. Klaptchuk and Ozonator, in the amount of $160,000 (Johnson v Klaptchuk(9 March 2017) Regina, QBG 1001 of 2014 (Sask QB) (“Judgment”);
3. Eight days later, on March 17, 2017, Mr. Klaptchuk unexpectedly passed away.
4. Shortly after Mr. Klaptchuk’s death, on March 27, 2017, counsel for the Judgment Creditors sent a letter to Mr. Klaptchuk’s solicitor, Merrilee Rasmussen, K.C., notifying her of the Judgment and advising that they would hold off on any enforcement proceedings for a reasonable period of time, to allow Mr. Klaptchuk’s family to grieve his passing;
5. The Judgment Creditors’ counsel also requested that Ms. Rasmussen bring the Judgment to the attention of the representative of the Estate;
6. By April 27, 2017, Ms. Rasmussen had replied to the Judgment Creditors’ counsel, saying that Ms. Klaptchuk was the executrix of the Estate, and that she was in the process of settling the Estate’s assets and debts and developing a plan to retire the Judgment. However, the Judgment was never paid;
7. On August 24, 2017, a notice of change of shareholders for Ozonator was filed with the Director of Corporations. It named Ms. Klaptchuk as the sole shareholder for that corporation. Ms. Klaptchuk would later take the position that this transfer of shares had been made without her knowledge or authorization. Ozonator subsequently became inactive and was ultimately struck from the Corporate Registry;
8. Shortly after the Ozonator share transfer had taken place, Ms. Klaptchuk engaged new counsel, David MacKay, and arranged through him to transfer all of the shares in PSS to herself. The requisite notice, naming Ms. Klaptchuk as the sole shareholder for PSS, was filed with the Director of Corporations on October 3, 2017;
9. Although Mr. Klaptchuk’s will named Ms. Klaptchuk as executrix, Ms. Klaptchuk had never applied for a grant of probate or letters of administration. Nor had she renounced the appointment or given any explicit indication that she has refused to accept it. In addition to the transfers of shares mentioned above, Ms. Klaptchuk had taken other steps to administer the Estate, including paying Mr. Klaptchuk’s funeral expenses and his tax arrears, and by paying certain debts owed by PSS out of her own funds. She had also continued to operate PSS as a business;
10. On July 24, 2019, the Judgment Creditors commenced a civil action against Ms. Klaptchuk by filing a statement of claim. In it, the Judgment Creditors claimed the below, among other things:

1. That, even though Ms. Klaptchuk had not formally assumed the role of executrix, she had intermeddled in the estate property. Namely, she had taken it on herself to possess and administer estate property even though she had not been appointed as executor or administrator, and she had transferred Estate property to herself;
2. That Ms. Klaptchuk was liable for devastavit because she had transferred Estate property, namely, shares of the capital stock in Ozonator and PSS, and shareholder loans owned by Mr. Klaptchuk, to herself without first satisfying the Judgment.
3. That these transfers were fraudulent conveyances, as they had been transferred knowing that such actions would delay, defeat or hinder their enforcement efforts.

11. On August 12, 2021, the Judgment Creditors filed an application in the Court of Queen’s Bench, seeking summary judgment against  Klaptchuk and an order directing her to provide a full accounting for the Estate, and tracing any assets she had removed from it. This application led to the hearing that resulted in the Chambers Decision, which found her personally liable to the Judgment Creditors in the amount of $160,000.

Chambers Decision:

12. The Chambers Judge found that, despite the fact that Klaptchuk said that she never accepted the appointment as executrix, her conduct amounted to an acceptance of the role of executrix. The Chambers Judge found that she had exercised significant authority over the Estate assets and had paid Estate debts.
13. The Chambers Judge then found that even though Ms. Klaptchuk was aware of the unsatisfied judgment against the Estate, she distributed assets — including her late husband’s shares in two businesses — to herself, before paying the Estate’s lawful debts.
14. The Chambers judge concluded that Ms. Klaptchuk’s conduct constituted a devastavit. A devastavit is committed where an executor or administrator wastes the estate’s assets by mismanaging, misapplying, or neglecting them, contrary to the duty imposed on them as a personal representative of the estate. The types of conduct that can give rise to personal liability on the basis of devastavit include, among other things, paying legacies to beneficiaries before paying the estate’s lawful debts, where the result is to leave insufficient funds to satisfy the claims of creditors.
15. The Chambers judge also found that Ms. Klaptchuk had not fully and properly administered the Estate and, for that reason, was not entitled to rely on the common law defence of plene administravit, which is available when there are insufficient assets to satisfy a claim by a creditor against an estate.
16. The Chambers Judge found that Ms. Klaptchuk was aware of the existence of the Judgment and, thus, she had “distributed Estate assets to herself in disregard of the Judgment” and that such conduct “amounts to devastavit which renders her personally liable for the Judgment”.
17. With the above conclusion made, the Chambers judge determined that it was unnecessary to consider the Judgment Creditors’ alternative claim of fraudulent conveyance.
18. Accordingly, the Chambers Judge found that Ms. Klaptchuk was found to be personally liable for the entire amount of the unsatisfied judgment, being $160,000.

Issues on Appeal:

On appeal, Ms. Klaptchuk contended that the Chambers judge erred in several ways, including (without limitation):

1. By granting summary judgment in the face of disputed factual issues; and
2. By failing to consider s. 45 of The Trustee Act, 2009, SS 2009, c T-23.01 (“Trustee Act”), which says that if a trustee is liable for a breach of trust, by reason of their act or omission, a court may still relieve them from liability if the court finds that they acted reasonably and ought to be excused for the breach.

Determinations of the Court of Appeal:

The Court of Appeal reversed the Chambers Decision and determined that the Chambers Judge had erred in a number of ways.

Failure to consider whether it would be fair to relieve Ms. Klaptchuk of personal liability:

The Court of Appeal held that the Chambers Judge should have (but did not) consider whether it would be fair to relieve Ms. Klaptchuk of personal liability under s. 45 of the Trustee Act.

S. 45 reads below:

45 If a trustee is or may be personally liable for a breach of trust as the result of any act or omission of the trustee or of an agent of the trustee, the court may relieve the trustee either wholly or partly from personal liability if the court is satisfied that the trustee:

1. acted honestly and reasonably; and
2. ought fairly to be excused:

1. for the breach; or
2. for omitting to obtain the directions of the court in the matter in which it was committed.

The Court of Appeal held that there was material in the record before the Chambers Judge that should have prompted him to turn his mind to whether s. 45 of the Trustee Act was properly applied in this situation. For example:

1. Ms. Klaptchuk had explicitly raised the applicability of s. 45 of the Trustee Actin the brief of law she filed in opposition to the summary judgment application;
2. In her statement of defence, she had pleaded that she viewed the shares in PSS as having no value because the company was losing money and its only physical assets were “old trucks and a lease on a building”;
3. Ms. Klaptchuk had stated in her affidavit that she had paid various Estate debts and other expenses related to the administration of the Estate out of her own pocket and, because of that, also viewed herself as a creditor of the Estate;
4. Ms. Klaptchuk also deposed that she had taken control of PSS as “[Mr. Klaptchuk]’s wife and as a creditor of the company” (due to the outstanding shareholder loan), and not simply as executor for the Estate;
5. Ms. Klaptchuk argued that she believed, given the state of the business, the provisions in Mr. Klaptchuk’s will, and her status as a beneficiary, that the transfer of shares to her was authorized by the Business Corporations Act.

As the Chambers Judge did not consider s. 45, the Court of Appeal held that this was an error of law, and the decision could not stand.

There was a genuine issue requiring trial:

The Court of Appeal also found that it was an error to grant summary judgment, when there were contested material facts.

For context, the Chambers judge had found that there was no genuine issue requiring a trial, and that the action was suitable for summary judgment. The Court of Appeal disagreed.

The Court of Appeal held that the value of the Estate was a material issue. The reason why it is material is as follows. For example, the Chambers Judge had found Ms. Klaptchuk to be personally liable to the Judgment Creditors in the amount of $160,000. But what if the value of the entire Estate had not even been $160,000? If so, how could it then be equitable to find that Ms. Klaptchuk should pay the amount of any shortfall difference, when the underlying Judgment was not one rendered against her personally.

With “thin and contradictory” evidence on the issue of the value of the Estate, the Court of Appeal held that this matter should be remitted for trial. As a result, this was not an appropriate case for summary judgment.

Conclusion:

The Court of Appeal set aside the Chambers Decision in its entirety, and remitted it to the Court of King’s Bench. Ms. Klaptchuk received her costs of the appeal. The amount of costs awarded to her was reduced due to the fact that Ms. Klaptchuk had brought an unsuccessful application to introduce fresh evidence on appeal.

The recent Saskatchewan King’s Bench decision in Kowalinski v Kowalinski (Estate) is an example of how some estates can devolve into bitter quarrelling between the children of a deceased.

Factual background:

This matter arose out of the Estate of Maria Kowalinski (“Estate”). Maria (“Deceased”) had died on February 3, 2016. Since that time, her children had been engaged in costly and exhausting disputes over various aspects of the Estate. The Estate was still not fully distributed as a result, despite the fact that the deceased had died quite a few years previous.

There were four beneficiaries of the Estate, being

1. Maria’s son Terry;
2. Maria’s daughter Beth;
3. Maria’s daughter Iris; and
4. Maria’s grandson, Delaney.

A summary of some of the background is below:

1. Marie executed her Will on April 23, 2013. She appointed her three children, Terry, Beth and Iris as executors. It is clear that there had been a pattern of Maria loaning money to her children, particularly Terry and Iris. This habit of lending monies had led to suspicion amongst the other children;
2. At one point, Terry was meeting with Maria and, for some reason, discovered that there was a collateral mortgage registered against Maria’s home on Shea Crescent in Saskatoon in the amount of $60,000. Maria confirmed that a mortgage (“Iris Loan”) was granted in order to secure a $60,000 loan from Maria to Iris.
3. Terry took Maria to Maria’s lawyers.  The lawyers recommended that Maria prepare a holographic codicil removing Iris as an executor. This was done, and the codicil, written on October 7, 2015, read as follows:

This is a codicil to my will dated April 23, 2013. I remove Iris Theresa Kowalinski as an executor of my Esetate (sic).

Iris Theresa Kowalinski owes me $86,600.00 for amounts I have lent loand (sic) to her which remain unpaid. Therefor (sic) her chare (sic) shall be reduced by $86.600.00$ (sic) plus any adittional (sic) debt and interest (sic) which may apear (sic).

Any costs of collecting (sic) from Iris shall be charged to her share.

4. Unfortunately, it appeared that no one actually looked to discover that the Iris Loan had already been paid off and Maria was in a position to insist that the mortgage be discharged.
5. Terry thereafter began to take steps to place the Estate in a position where probate would not be necessary. Terry arranged for Maria’s tax-free savings account to be placed in his sole name. He also had title to Maria’s home registered in his and Maria’s names, as joint tenants. He also then confronted Iris about the line of credit and the mortgage on Maria’s home. Iris took that opportunity to explain to him that the line of credit had been paid in full. In due course, that mortgage was discharged.
6. Notwithstanding Maria’s declining health, Iris importuned Maria on January 30, 2016 for an additional $15,000 loan. The loan is recorded in a purple notebook, which was the manner in which Maria kept track of what her children owed her.
7. Maria passed away on February 3, 2016.

Will challenge allegations:

8. After Maria died, there were multiple court applications wherein Iris sought a trial to bring into question Maria’s mental capacity at the time of the codicil and to require that the Will be proved in solemn form. This was not successful.
9. There were also a number of applications engaging Terry and Beth and requiring them to disclose personal property at Maria’s residence on Shea Crescent. 
10. There was an application brought by Iris to permit cross-examination of Terry, Beth and Delany on their affidavits. This engendered significant legal fees, but created evidence which the Court described as of “only moderate probative value.”

Issue:

The Court determined that a number of issues required determination. This case comment focuses on the below issues:

1. Should Terry and Beth receive executors’ fees, and, if so, how much?
2. Who pays the parties’ respective legal expenses?
3. There are a number of personal items whose ownership is contested. How should those chattels be divided?

Findings by the Court:

1. Should Terry and Beth receive executors’ fees and if so, how much?

The Court found that there was no question that Terry and Beth put in a significant amount of time dealing with matters arising from the Estate. However, the Court held that much of their efforts had nothing to do with the administration of the Estate, but such efforts were rather in engaging in battle with Iris.

For context, in Saskatchewan, a court will often award compensation which in an amount which is a global 2-3% of the Estate. In this context, the Court ordered that Beth and Terry were to receive compensation on the lower end of the spectrum:

1. That Beth was to receive 1% of the Estate for her compensation;
2. That Terry was to receive 0.5% of the Estate.

2. Who pays the legal expenses?

Terry and Beth took the position that Iris was the primary cause of the entire litigation and that she should pay the costs of such legal expense.

The Court however found that there was plenty of blame to be spread around all three siblings. Accordingly, the Court ordered that each person shall bear their own costs.

However, the Court ordered that any future legal fees from this date onwards, shall be borne by the Estate, subject to being taxed by the Court.

3. There are a number of personal items whose ownership is contested. How should those chattels be divided?

The siblings were disputing how to divide certain chattels. These ranged from wood carvings, a nutcracker bowl to a black diamond pendent necklace. Unfortunately, in their respective briefs, each side creates a slightly different list of chattels in debate.

The Court held that there was no correct way to divide the chattels, but yet it was “a task that must be accomplished in order to bring the estate bickering to an end.”

The Court ultimately selected a unique and uncommon method of dividing up the chattels. The Court directed that the judge would draw names from a hat to determine ownership:

44         I conclude that “luck” is the best arbiter. I direct counsel to prepare a list of chattels that are in debate. Perhaps the siblings can agree on some so that we do not have a raft of items to deal with. However, I leave that to them.

45        In any event, when the list is prepared, it is to be forwarded to me through the Local Registrar and I will then set a date to draw names from a hat to determine ownership of the chattels in issue. The draw will take place in a courtroom and on the record.

Conclusion:

Any person who has hired a litigation lawyer in Saskatchewan knows that the legal fees to go to court (and prepare written evidence and argument) are significant. For any thoroughly disputed matter, the legal fees will easily get into the five figures for each side.

Despite this, estate disputes can often be extremely controverted, because there is an understandable emotional dynamic, when one family member perceives that there are questions of whether their beloved love one (usually a parent) was taken advantage of, or whether another sibling is trying to get more than their fair share.

Kowalinski reminds us that such disputes, even when the positions are sincerely held, may not result in an outcome that all parties (or, at the very least, the Court) may consider to be proportionate to the time and legal cost of litigation. However, to be candid, this problem shows no sign of resolving itself. So long as there are situations in which siblings distrust each other, and there is some murkiness as to exactly what a deceased parent intended for their money and estate, emotional estate disputes will continue to exist.

One proactive cure for this, is for persons to ensure better communication with their own children or estate beneficiaries, during their life. If the Deceased in this situation had sat all of her children down, and calmly explained exactly who had received what monies from her in the past, and what the Deceased nevertheless wished for her Estate in future, some of this litigation may have been avoided.

The recent Saskatchewan Court of King’s Bench decision in Riben Estate (Re), 2023 SKKB 72 offers a reminder that a will challenger who alleges coercion must offer direct evidence to actually prove that pressure resulted in the creation of the challenged will. If they cannot offer such direct evidence, a court may find that there is no genuine issue for trial, and dismiss the will challenge.

Factual background:

1. Judy Riben (“Judy”) died on September 1, 2021, leaving behind:

1. Son, Paul Riben (“Paul”);
2. Son, Carl Riben (“Carl”);
3. Daughter, Juanita Menard (“Juanita”).

2. Judy had executed a will on April 21, 2021 (the “April Will”), before lawyer Marianne Kramchynsky in Blaine Lake, Saskatchewan;
3. On July 20, 2021, Judy had executed a revised will (the “July Will”), which gave less to Paul than the prior April Will.
4. At the time of Judy’s death, there was an outstanding lawsuit that was initiated by Paul against Judy (while she was alive), and also against Carl and Carl’s wife, Maria Riben.;
5. There were a variety of applications before the Court in Riben Estate. For the purpose of this blog article, the writer focuses on the application by Paul to have co-executors Carl and Juanita prove the July Will in solemn form.

Issues in dispute:

The issue was whether Paul had adduced evidence which presented a genuine issue for trial, on the issue of alleged undue influence. If so, the court would order a trial which would determine if the July Will was valid.

Steps involved in a will challenge:

To challenge a will in Saskatchewan, a challenger must go through two levels of hearings:

1. The first stage is a threshold Chambers hearing to determine if there is sufficient merit in the challenge to warrant a trial;
2. The second stage (if the applicant is successful) is a trial hearing to actually determine the allegations made against the will.

Positions of the Parties:

Paul made various submissions as to why he felt solemn form should be ordered:

1. While Paul did not contend that Judy lacked mental capacity to make the July Will, he contended that Carl unduly influenced Judy in the preparation of the July Will;
2. Paul attempted to offer the below as “suspicious circumstances” relating to the preparation of the July Will:

1. There had been significant revision of Judy’s will in Carl’s favour and to the detriment of Juanita and Paul. This was in contrast to the April Will, which had been made only three months prior;
2. Judy had made a inter vivos transfer of land from Judy to Carl and Judy jointly, which would have the effect of resulting in a direct transfer to Carl once Judy passed away.
3. Paul pointed to the fact that Judy allegedly expressed in August 2021 to Juanita that the joint transfer to Carl by Judy had been a “mistake” and that the property was supposed to be divided equally between Carl, Paul and Juanita;
4. Paul said that, due to her cancer diagnosis and narcotics and anti‑anxiety medications, Judy was more susceptible to coercion and undue influence at the time of the preparation of July Will; and
5. Paul found it suspicious that Carl drove Judy to the appointment to execute and sign the July Will. Paul said that Carl “exerted significant pressure by constantly telling her she needed to sign it and yelling at her to get into the car before the appointment”.

3. Paul also alleged that  Carl would bully and abuse Judy and would yell and threaten her whenever he visited and, eventually, Judy had to start taking anti‑anxiety medication whenever she had to see Carl;
4. Paul and Carl had at all material times been embroiled in litigation. Paul believed that Carl pressured Judy to execute the July Will because Carl was upset that Paul wanted his land back and Carl was envious of Paul’s success with his distillery business.

Paul also offered an affidavit from Juanita, in which she said in part:

1. She observed that Judy began to feel unwell in January or February 2021. An MRI on April 9, 2021, revealed that Judy had metastatic breast cancer which had spread to her lungs and spine. Judy had surgery and returned home on April 21, 2021, but she was hospitalized again at the end of June, recovered for a short while;
2. Around July 25, 2021, Judy had a breakdown and was carried out of the house by Paul; she was hospitalized until August 6, 2021. After her discharge from the hospital, Judy moved into Juanita’s condo in Saskatoon, where she lived until she died on September 1, 2021;
3. Juanita had concerns about whether Carl unduly influenced Judy to sign the July Will. Juanita apparently offered however no specific dates and alleged specifics of such coercion;
4. A few days before the second appointment to sign the July Will, Carl had told Judy not to take narcotics on that day, but Juanita states Judy took them that day anyway;
5. Juanita said that Carl insisted on driving Judy to the appointment and “exerted significant pressure by constantly telling her she needed to sign it and yelling at her to get into the car before the appointment”;
6. Juanita states that she was concerned about Judy signing the July Will but did not interfere because Carl said if she did anything to interfere, he would contact his lawyers because she was “obstructing Mom’s wishes.”
7. Juanita said that there was extensive discussion between Judy, Juanita and Carl, as to how to effect a subdivision that Judy allegedly wanted. However, the matter remained unsettled and in the meantime, Judy passed away before it could be resolved.

Carl, in response to the above evidence, offered his own evidence.

He stated that, in his observation, Judy had capacity until shortly before her passing, including having capacity during the month of July 2021. Carl noted that she was doing her own banking, engaging in the day‑to‑day affairs of the farm and was fully aware of everything and everyone going on around her. Carl denied pressuring Judy to execute the July Will or any other document. In short, Carl denied that he had unduly or inappropriately influenced Judy in any fashion.

Carl also provided an affidavit of lawyer Marianne Kramchynsky, who had met with Judy at various times:

1. The first communication that Ms. Kramchynsky received on the file was on April 6, 2021, when Ms. Kramchynsky received email instructions for a will, power of attorney and health care directive for Judy from Juanita;
2. Kramchynsky met Judy in person on April 9, 2021, when she was brought to her office by Juanita. Judy was not capable of leaving the car on that occasion due to a cancerous tumour on her spine;
3. Kramchynsky witnessed Judy’s signature on the email instructions but did not provide any advice as to form or content that day;
4. On June 24, 2021, Ms. Kramchynsky received email instructions from Juanita to amend the April Will for Judy. The significant contemplated changes for the will in the appended email included a clause that if Judy is unable to drive, then her vehicle would be gifted to Juanita. As well, the home quarter, house and yard were to go to Carl, but he was to let Juanita reside in the home “as long as she needs”, which could be “indefinitely”;
5. Given the volume of material received from people other than Judy, Ms. Kramchynsky was careful to discuss Judy’s wishes with her directly, both in telephone and in person;
6. Interestingly, Ms. Kramchynsky wrote that Judy clearly indicated during their phone call of July 5, 2021, that Judy did not want Juanita’s instructions followed;
7. Kramchynsky then saw Judy on July 20, 2021, in her office to execute the July Will. Judy attended the office alone and that none of her children were present in her office or in the building as the documents were reviewed or executed;
8. Kramchynsky found Judy to be alert, did not complain of pain. Judy was very sure she wanted to transfer her property to joint tenancy with Carl. Judy wanted all three of her children to share in personal belongings, and said that Juanita was already using her car. Judy mentioned working on a settlement with Paul regarding stuff that Paul had taken and any funds from that Judy would decide how to allocate;
9. Kramchynsky wrote in her notes that, given the effort it took for Judy to call Ms. Kramchynsky and arrange for this appointment, and given her lucidity and independence, Ms. Kramchynsky had no doubts about Judy’s capacity.

Determination by the Court:

Ultimately, the Court in Riben held that the evidence filed by Paul was not capable of raising a genuine issue for trial, of undue influence.

The Court gave no real weight to the evidence of Juanita. The Court went on to note:

1. The Court held that Juanita’s evidence of the July 25, 2021, breakdown was not relevant as it did not have a close proximal nexus to the date of execution of the July Will or the events leading up to it;
2. Juanita’s opinions of Judy’s mental capacity are irrelevant and not useful. Juanita was not qualified to give a medical opinion and her statements are of a general undated nature;
3. Juanita’s base concerns with respect to Carl’s “undue influence” are irrelevant as there was no factual underpinning for those concerns;
4. The evidence relating to Judy taking narcotics “a few days before” her appointment to sign the July Will, was not helpful as there is no evidence provided about how this may have compromised her mental capacity that day or in the few days after. Further, the fact that Carl had told her not to take the narcotics would suggest Carl wanted to ensure her mind was clear when she eventually signed the will. As well, the fact that Judy did not listen to Carl would be suggestive of Judy not being under Carl’s control.

The Court also made the below findings:

1. The court placed great significance on the evidence of Ms. Kramchynsky. Her notes depicted Judy as a lucid, independent individual who was capable of making decisions at a difficult stage of her life, given her ill health;
2. The Court did not find place much weight on the allegation that Carl was yelling at Judy to get in the car and telling her she needed to sign the will. The Court wrote that while yelling at your elderly mother to get in the car and telling her she needed to sign the will before driving her to the appointment are evidence of impatience, in this context they did not show undue influence. There is no evidence that Carl told her what to give away in the will at the time of the appointment or shortly before;
3. The Court placed significance on the presence in the wills of a “non‑Contest Clause – Gifts Not Equal” clause. Such showed that Judy knew that she was not distributing her estate equally but yet believed the distribution was fair in light of assets already transferred to her children during her lifetime;
4. The evidence clearly establishes that none of Judy’s children had been controlling her movements to the exclusion of another. In fact, Juanita, as co‑executor of both wills and Judy’s power of attorney, appeared to play an important role in Judy’s life. There was no evidentiary basis to believe that Carl had a level of control over Judy’s thoughts or movements in any manner during the events leading up to the making of the July Will;
5. Moreover, the evidence showed that Paul sued his mother (and Carl and Maria) one day after the execution of the April Will. The Court held that common‑sense showed that such conduct would logically have a major effect on Judy’s distribution of assets in the will. Therefore, the fact that Paul received less in the July Will than the April Will was not suspicious at all when the timing of the lawsuit is taken into consideration.

Conclusion:

Both of the counsel in Riben were excellent lawyers, and the issues were carefully and comprehensively argued.

Ultimately, the Court found no evidence which, if accepted at trial, would prove undue influence. It is no doubt difficult for a challenger to prove an allegation of undue influence, given that undue influence typically does not occur in front of witnesses.

The outcome in Riben shows that it is never easy to predict what level of evidence a court will find to be required, in order to raise a genuine issue of undue influence. Undue influence remains one of the hardest issues to prove, when challenging a will.