For almost 100 years, we have had legislation in BC that allows a court to vary a will to cause a larger part of the estate to be gifted to a spouse or child. Until recently, courts often did not give much weight to a marriage agreement that limited the amount a spouse would receive upon death of the other spouse. Recently, our Court of Appeal has revisited this issue in the context of later-in-life relationships. The Court of Appeal recognized that it has become more common for adults to start second, third or later relationships, perhaps after the death of a spouse or a divorce. Often, both spouses of these late-in-life relationships have amassed their wealth prior to the commencement of the relationship and have children from an earlier relationship.
As a recognized leader in wills, estates and trusts, Amy Mortimore presented to senior practitioners at the recent CLEBC “Estate Planning Express” seminar on a related recent Court of Appeal decision—Kish v. Sobchak Estate—and the interplay between marriage agreements and wills variation.
Summary of Kish v. Sobchak Estate
Marie Kish and Edward Sobchak began a relationship later in life. They had children from previous relationships. They were financially independent, maintained separate homes, and the trial judge found that the deceased did not wish to be in a spousal relationship with Marie. While alive, the parties agreed to leave their respective estates to their own children.
Marie developed dementia, and Edward became her primary caregiver. Edward then developed cancer and died before Marie. At the time of the trial, she was incapable of managing her own affairs, due to her dementia, and lived in a care facility. Her son brought the application to vary Edward’s will on her behalf.
The trial judge found that the parties were in fact “spouses” and varied Edward’s will to provide Marie with $100,000, based primarily on financial need. Edward’s estate appealed.
The Court of Appeal considered the specific circumstances of these parties, and, in particular, their long-standing plan to keep their assets separate from one another. The Court of Appeal considered what the average person living in BC would think about the court disregarding the parties’ agreement and varying the will. In the result, the Court of Appeal gave greater weight to the principle of testamentary autonomy and their long standing financial arrangements, and reduced the award to $30,000.
In her presentation, Amy discussed lessons learned from Kish v. Sobchak Estate, which included:
- Purpose of wills variation proceedings
- Importance of testamentary autonomy
- Role of contemporary society’s views in the court’s determination of whether or not to vary a will
- Broad discretion of the court in determining whether to vary a will
- Distinctions between variation law and family law
She also discussed various factors that the court will consider where there is a marriage agreement, but a variation claim is made. These include:
- Whether claiming spouse contributed to assets
- Whether earlier spouse contributed to assets
- Expectations of inheritance of spouse and children
- Wording of the agreement – does it specifically contemplate death as well as divorce?
- Adequacy of disclosure of assets
- Did parties evidence intention to disregard terms?
As wills variation legislation in BC approaches the century mark, it continues to track the evolution of current societal expectations and realities. The BCCA’s recent decision in Kish v. Sobchak Estate suggests that where the parties continue to conduct themselves in a manner consistent with the terms of a marriage agreement, the court will pay deference to those terms.
See Amy’s presentation to learn more.