Can the Child of Someone Barred From Being a Beneficiary Receive Their Parent’s Share of an Estate?

March 9, 2022

written on behalf of Feigenbaum Law

One of the more uncomfortable aspects of the law is the discussion of laws as they relate to terrible things that people experience in their real lives. While issues concerning murder don’t often make their way into our blog, a recent decision from the Supreme Court of British Columbia presents us with an interesting wills and estates situation that would have the same implications in Ontario. The issue before the court is what happens to the would-be inheritance of someone who is prohibited from receiving an inheritance after being found guilty of killing the testator.

Son is found guilty of murdering his mother

The case made its way before the court when the testator, who was a widow, died at the hands of one of her two sons (“CW”), who plead guilty to second-degree murder in 2018. At the time of the trial, CW was serving his sentence. In addition to the prison sentence that came as a result of the crime, CW was also disentitled to receive what would have been his share of his mother’s estate.

Canada has a long-standing public policy rule that was described in a 1982 decision from the Ontario Court of Appeal, in which the court wrote, “[t]he basic rule of public policy which is not disputed is that the courts will not recognize a benefit accruing to a criminal from his crime.” This was echoed by the Supreme Court of Canada in a 1992 decision in which the court wrote, “a person should not be allowed to insure against his or her own criminal act irrespective of the ultimate payee of the proceeds.” This rule extends to estate law, with courts as far back as 1937 writing that the estate of a person guilty of a crime is also not able to benefit from the proceeds of a crime.

The wrinkle that came up and led this situation to court was that CW had been in a romantic relationship prior to the testator’s death. This relationship led to the birth of a child eleven days after CW’s mother died. The executors of the estate asked the court for direction on what should happen to CW’s shares of the estate.

Looking at the deceased’s will

The testator left a will that was dated January 15, 2013. At the time of her death, her estate was worth approximately $860,000. The will directed that the estate be divided between her two children, with a clause stating that,

“with respect to the share created for any child of mine who died before me and left one or more of his or her children alive at my death, divide that share equally among those children of that deceased child;”

The will provided that CW’s child would inherit his share of the estate only in the event of CW’s death. Of course, at the time the will was written, it was unlikely that the deceased would have considered her son being disentitled for what he would eventually do.

The executors, who were friends of the deceased, asked the court for direction on whether CW’s child can receive her father’s share of the estate. It was their position that the child should be able to receive her father’s share.

“LW”, who was the testator’s other child, took the position that his brother’s shares should pass to him. He pointed to the long-standing public policy that we mentioned earlier. LW also referred to an 1892 decision in which the plaintiffs were claiming a life insurance policy that was in place for their father, who was poisoned by his wife. The court found that anyone who would be claiming through the wife would be prohibited from doing so, but added that in this case, they would be claiming through the father. The court wrote that it would be an injustice to public policy to not allow the children to receive the proceeds from the insurance policy.

The court looked at the provinces Wills, Estates and Succession Act which states,

46(1) If a gift in a will cannot take effect for any reason, including because a beneficiary dies before the will-maker, the property that is the subject of the gift must, subject to a contrary intention appearing in the will, be distributed according to the following priorities:

(a) to the alternative beneficiary of the gift, if any, named or described by the will-maker, whether the gift fails for a reason specifically contemplated by the will-maker or for any other reason;

(b) if the beneficiary was the brother, sister or a descendant of the will-maker, to their descendants, determined at the date of the will-maker’s death, in accordance with section 42(4) [meaning of particular words in a will];

(c) to the surviving residuary beneficiaries, if any, named in the will, in proportion to their interests.

The court heard from the province’s Public Guardian and Trustee (PGT), who represented the child that less violence would be done to the intention of the testator if the child was able to receive what her father would have under the will. The PGT provided references to two cases, with one from 2011, in which a testator was murdered by a family member named in a will, but the would-be benefactor’s children were still able to receive that portion of the estate. The paramount consideration in this case was to ensure that the testator’s obvious intentions should not be defeated.

The court agreed with this position, stating that while CW is clearly not able to receive his portion of the estate, the intent of the will was that if the testator’s children predecease her, their children would receive the appropriate share.

Feigenbaum Law in Toronto can assist you with any wills and estates related issues

While the case discussed today is not the type of situation most people will hopefully ever find themselves involved in, it does highlight the importance of estate planning and putting a will in place that aims to address in clear, direct terms, what someone wants to have happen to their estate. In addition to proactive planning, the legal team at Feigenbaum Law also helps clients in issues related to estate litigation for any type of issue that might arise after the death of a loved one. Feel free to reach us online or by phone at 1-877-275-4792 to see how we can help you today.

Blog

Small Business Owner Challenges CRA Ruling on Use of Boat

Business Tax

Small Business Owner Challenges CRA Ruling on Use of Boat

September 23, 2022

Economic Turmoil Reflected in Virtual Currencies and Assets

Cryptocurrency

Economic Turmoil Reflected in Virtual Currencies and Assets

September 13, 2022

Taxpayer Alleges Bank Account Belonged to Deceased

Estates

Taxpayer Alleges Bank Account Belonged to Deceased

August 23, 2022

Are Uncashed Cheques Part of an Estate?

Estate Law

Are Uncashed Cheques Part of an Estate?

August 16, 2022

At Some Point, a Business Should Start to Show Profit

Corporate Tax Law

At Some Point, a Business Should Start to Show Profit

August 10, 2022