Wills Interests in Canada

Construction, Quantity of Interest Taken

Compiled by Eric B. Appleby:

In GeneralAbsolute interests

“A person has an absolute interest in property when such is so completely vested in the individual so that no contingency can deprive him of it without his consent”. Black’s Law Dictionary, 6th Ed., p. 812. The residuary clause in a will instructed the executor to convert the residue into money and establish a trust fund for the testatrix’s son and pay him $300/month “until … this fund has been exhausted”. The son died before the fund was completely distributed. The Manitoba Court of Queen’s Bench, Probate Division, interpreted the clause and held that it created an absolute gift in the son. The residue vested in the son at the time of the testatrix’s death and, accordingly, the fund formed part of the son’s estate. The Manitoba Court of Appeal affirmed the decision. See Ferguson Estate, Re (1992), 76 Man.R.(2d) 286; 10 W.A.C. 286 (C.A.).

Concurrent gifts, per capita or per stirpes

When property is given to the descendants of two or more persons, the question frequently arises whether the donees are to take per stirpes, that is, as representatives of their respective ancestors, or per capita, that is whether they together form one class each member of which is to take an equal share. A clause in the testator’s will directed the executor to distribute the residue of the testator’s estate to “my nieces Yolande, Jeannine, and Pauline and Alphonse Levasseur’s 4 children – to share and share alike”. An issue in this application was whether the clause divided the residue into sevenths (per capita) or into fourths (per stirpes). The Alberta Surrogate Court held that, given the presence of the phrase “share and share alike” coupled with the rule that, prima facie, “to A and the children of B” was an indication of a per capita distribution, the testator’s intention was one of a per capita distribution. The court directed that the residue be divided into seven equal shares. See Boudreault Estate, Re (2001), 290 A.R. 116 (Sur. Ct.).

Life interests

The interest taken by a donee may be defined by rights of enjoyment attached to the gift. For example, a gift of the “possession” or “use and enjoyment” of chattels prima facie gives the donee a life interest. See Halbury’s Laws of England, 2nd Ed., vol. 34, para. 386. The testator drafted a will wherein he bequeathed a duplex to his wife, Martini, and indicated that she give it to the Christensens when she no longer need the property. The Christensens asked the court to interpret the bequest. The Alberta Court of Appeal held that a court should endeavour to give effect to the testator’s intention in interpreting a will. The most likely interpretation was that the testator intended Martini to have a life estate without a power of encroachment, with a gift over to the Christensens. The absence of the words “during her lifetime” did not necessarily mean that the testator did not intend to grant his wife a life estate. It was inappropriate to decide the case upon a standard that would normally be applied to a will drafted by someone with legal training. See Christensen v. Martini (1999), 232 A.R. 339; 195 W.A.C. 339 (C.A.).

The testator gave to his wife all his property “for her sole use during her lifetime with full power and authority to hold”, manage, sell and otherwise deal in the property. The Nova Scotia Supreme Court, Trial Division, held that the testator intended to confer a life estate on his wife. See Dinn Estate, Re (1977), 27 N.S.R.(2d) 298; 41 A.P.R. 298 (T.D.).

Concurrent gifts, joint tenancy or tenants in common

“When property is given to two or more persons concurrently the question arises whether these persons are to take as joint tenants, with the attendant right of survivorship, or as tenants in common. The common law rule for both real and personal property was that the donees took as joint tenants. This rule, subject to any legislation to the contrary, is Canadian law. However, the rule was always applied with reluctance, and the slightest indication from the context to negative the idea of joint tenancy was sufficient to result in a finding of tenancy in common. So, in the Manitoba case Re Peter’s Will (1967), 63 W.W.R. 180 the words ‘in equal shares’ were held to indicate a tenancy in common. Furthermore, it has been said many times that in case of ambiguity the court will always lean towards the construction which creates a tenancy in common. ” (emphasis added). See Thomas G. Feeney, Canadian Law of Wills, vol. 2, page 99.

The New Brunswick Court of Queen’s Bench stated that a joint gift without words of limitation creates a joint tenancy with the right of survivorship. See Mitchell Estate, Re (1972), 7 N.B.R.(2d) 504 (Q.B.), paragraph 5.

What constitutes Residue

A husband’s will provided that all his life insurance policies, including those naming his wife as beneficiary, be paid to his trustee for the benefit of his three daughters as if the insurance proceeds formed part of the residue of his estate. The Saskatchewan Court of Queen’s Bench held that the insurance proceeds did not form part of the residue of the estate; the will was simply being used to change beneficiaries as authorized by s. 152 of the Insurance Act. See Harry v. Harry Estate (1988), 67 Sask.R. 279 (Q.B.).

After disposing of the capital of a certain trust in her will the testatrix left her “remaining capital” to a sister and to two nephews or the survivor of them if one or both survived the sister – The Nova Scotia Supreme Court, Trial Division, held that the clause constituted a gift of the residue of the testatrix’ estate. See Bowman Estates, Re (1975), 17 N.S.R.(2d) 76; 19 A.P.R. 76 (T.D.), para. 22. A testator’s will provided that “I nominate and appoint … Timothy Clarence Nelson Michael Murley, as heir to my Estate…”. The Newfoundland Supreme Court, Trial Division, concluded that the words had the legal effect of making Timothy Murley the residuary legatee. The word “estate” encompassed the residue and would apply to all assets not otherwise disposed of. See Murley Estate, Re (1995), 130 Nfld. & P.E.I.R. 271; 405 A.P.R. 271 (Nfld. T.D.), para. 7.

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This entry was last updated: February 13, 2017