In a recent decision, the BC Court of Appeal clarified the importance, or lack of importance, of the claims of persons not protected by the Wills Variation Act: any person not falling under the definition of spouse or child. In Graham v. Chalmers, 2010 BCCA 13, the Court of Appeal upheld the trial judge’s decision that the testatrix, Mrs. Graham, had not fulfilled her moral obligation to her adult daughter Janet. Accordingly, the court varied the will pursuant to the Wills Variation Act, in spite of strong evidence that Mrs. Graham had structured her will so as to pay for her grandchildren’s education.
Janet had lived her entire life with her mother. At the time of her mother’s death, she was 46 years old and had modest financial means. When Janet became an adult, she did not move out from the family home because of her desire to protect her mother from her father’s abuse. She remained in the house after her father’s death in 1983.
Mrs. Graham’s other daughter, Sandi, had two children who were 22 and 16. The evidence at trial was that Mrs. Graham was very fond of her grandchildren and that she spent a lot of time with them.
In 2003, Mrs. Graham made a will that bequeathed $25,000 to Janet, with the residue divided equally among Janet, Sandi and the grandchildren. The specific gift of $25,000 to Janet was intended to equalize an inter vivos gift of $20,000 Mrs. Graham had made to Sandi to help her purchase her first home. The solicitor who drafted the will testified that Mrs. Graham decided to give Janet only one-quarter of the residue because she believed that Janet had received some benefit from living in the family home and wanted to provide for her grandchildren’s education.
The gross value of the estate at Mrs. Graham’s death was $643,203 but was over $1 million at the time of trial.
Janet initiated an action under the Wills Variation Act on the basis that it was unfair that her sister and her sister’s children received three-quarters of the estate. Sandi and the grandchildren opposed the action and argued that Mrs. Graham’s will was a reflection of her wish to fund her grandchildren’s education.
Both the trial judge and the Court of Appeal agreed that a variation was appropriate, although the Court of Appeal disagreed with the approach taken by the trial judge. The trial judge examined all of the beneficiaries’ circumstances and considered whether anything negated or minimized Mrs. Graham’s moral obligations to Janet. The two possible negations were identified: 1) Mrs. Graham’s desire to provide funds for her grandchildren’s education, and 2) Mrs. Graham’s belief that Janet had already received some benefit by living in the family home.
However, the Court of Appeal’s approach was to consider whether Mrs. Graham fulfilled her legal and moral obligations to Janet, regardless of the interests of other individuals, including the grandchildren. As Mrs. Graham owed a moral obligation to her daughters and had no legal obligations to any person, the claims of Janet and Sandi were analyzed independently of the claims of her grandchildren, Shannon and Paul. Hence, Mrs. Graham’s desire to provide funds for her grandchildren’s education was irrelevant when considering Janet’s claim.
The Court of Appeal conducted a detailed analysis of the circumstances between Mrs. Graham and Janet, including the fact that Janet paid her mother rent, shared in household chores, and otherwise contributed to her well-being. After considering all the circumstances, the Court of Appeal concluded that the range of adequate provisions for Janet was between 30% and 50% of the estate. The Court of Appeal varied the will to divide the residue of the estate 40% to Janet, 40% to Sandi, and 10% to each grand child.