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Estates & Wills & Trusts

Estates bar relieved by competing decision on validity of dual wills

The estates bar can breathe a collective sigh of relief now that a Superior Court judge has declined to follow the example of a colleague on the bench whose decision called the use of dual wills into question, Toronto trusts and estates lawyer David Mills tells AdvocateDaily.com.

Mills, managing partner with Mills & Mills LLP, explains that both cases involved a common estate planning tool in which primary and secondary wills are executed by the same testator with the aim of smoothing the estate administration process.

Assets requiring probate are dealt with in the primary will, and all others are covered in the secondary will, he adds.

Mills says lawyers in the practice area were worried when Ontario Superior Court Justice Sean Dunphy invalidated a set of primary wills in one recent case.

“It caused a lot of chatter in the estates bar,” says Mills, who did not act in either matter and comments generally. “Everyone is waiting to see and hoping that the Court of Appeal will overturn it. If it ends up being upheld, it will leave estates lawyers throughout the province with a great deal of work to do.”

However, within a month, a new decision by Justice Michael Penny reached the opposite conclusion to Dunphy in similar circumstances.

“I must respectfully part company with Dunphy J.,” Penny wrote, adding that he believed his Superior Court colleague’s decision was “incorrect as a matter of law.”

“It’s a great relief to the estates bar,” Mills says. “Of course, we’re still waiting for the Court of Appeal to rule in the earlier case, but in light of the new decision, we can feel a little more confident about what will happen.

“There must be hundreds of thousands of wills of this sort in Ontario, which is a lot of clients to contact and wills to update if the law has changed,” he adds.

In the earlier case, Dunphy ruled that the primary wills before him were invalid because they failed to “describe with certainty” the property that was subject to each will. Instead, they left the decision up to the discretion of the trustees.

The couple in the case, each of whom had primary and secondary wills, died in October 2017, designating their daughter, accountant and lawyer as trustees of their estate.

According to the decision, the primary wills put the executors in charge of “all property owned by me at the time of my death EXCEPT ... [certain named assets and] any other assets for which my Trustees determine a grant of authority by a court of competent jurisdiction is not required for a transfer or realization thereof,” while the secondary will said it referred to “all property owned by me at the time of my death INCLUDING ... [certain named assets and] any other assets for which my Trustees determine a grant of authority by a court of competent jurisdiction is not required for the transfer or realization thereof.”

The judge ultimately voided the primary wills, finding that the language used failed to identify the property it related to, violating the subject-matter certainty necessary for any valid will.

“The prevailing opinion among my colleagues is that the case was wrongly decided, and there is hope it will be overturned by the Court of Appeal,” Mills says, noting that Penny’s decision falls in line with that view.   

In the meantime, he says practitioners in the area are studying their own basket clauses in light of the recent decision.

If Dunphy’s decision is upheld, Mills says the language used by his firm may be distinguishable, though he prefers not to be required to find out in any similar challenge.

“Even if the decision is right on the narrow issues, we think our wills would be fine. If the Court of Appeal provides guidance that is different than in this one, we will have to look at our versions again and determine whether we still feel the same way,” he adds. “Most estate lawyers I have spoken to about this are taking a wait-and-see approach.”

 

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