MacLean Law’s senior Vancouver Spouse Unfair Will Variation Lawyers were very pleased to see a recent BC Will variation case thoroughly analyze and apply the potential entitlement under the BC Family Law Act when deciding what a spouse in a 34-year marriage should get when she was left out of a Will by her deceased husband. The deceased husband felt this was appropriate BECAUSE he had gifted her a one-half interest in the matrimonial home. The case emphasizes how spouses occupy a preferred position over adult children in cases where Wills variation applications are brought involving a spouse against the deceased’s children.
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The concept of family property versus excluded property as well as her entitlement to spousal support were all at play in this case involving the intersection of BC family law and WESA estate law.
In Unger v Unger Estate the court had to review the legal duty and moral duty to decide if a deceased husband had properly provided for his surviving spouse. The question was what should the surviving wife get in addition to the half share of a home the deceased testator had gifted her?
Moral and Legal Duty Key Explained 1 877 602 9900
To see if the wife or the deceased husband’s adult children would receive the lion’s share of the estate, the judge looked at the legal duty a spouse would owe to the other if they had separated or divorced based on leading Supreme Court of Canada authority:
[88] The applicable family law legislation, the FLA, came into force on March 18, 2013.
[89] Under s. 81 (b) of the FLA, each spouse is entitled to an undivided half interest in all family property which includes all property owned by at least one spouse as well as beneficial interests of at least one spouse: see. s. 84(1). However, excluded from the family property is, among other things, any property acquired by a spouse before the relationship began, and any property derived from such property or disposition of such property: s. 85(1).
[90] The evidence supports that the plaintiff would have had a claim to any monies in the bank account of Mr. Unger at the time of his death.
[91] With respect to the Matrimonial Home, the defendants contend that the plaintiff would not have had a claim under the FLA, as it was purchased using proceeds of excluded property, namely the Surrey Property and the fishing boat and licence.
Vancouver Spouse Unfair Will Variation Lawyers Wonder If Presumption Of Advancement Weaker Now?
[92] The evidence supports that the plaintiff did not provide any initial consideration in exchange for being put on title. Under the common law, a husband’s transfer of property into the joint names of he and his wife was traditionally presumed to be a gift: see Waters et al., Waters’ Law of Trusts in Canada, 4th ed (Toronto: Thomson Carswell, 2005) at 413. Although the continued existence of this presumption has been weakened or cast into doubt in recent jurisprudence, the BC Court of Appeal, in V.J.F. v. S.K.W., 2016 BCCA 186 [V.J.F.] at para. 50, stated that:
[50] … Where the evidence is insufficient or equivocal and the transfer was made by husband to wife, the law normally provides an evidentiary presumption that a gift was intended and the burden of persuasion shifts to the opposite party to rebut on the balance of probabilities …
[93] The evidence in the case at hand supports that Mr. Unger intended the transfer of property to be a gift. In the Will, Mr. Unger explicitly states that he transferred 50% of the property to the plaintiff without any contribution, and in my view no other evidence rebuts this.
Vancouver Spouse Unfair Will Variation Lawyers Warn That Uncertainty On Excluded Property Put In Joint Names Persists
[94] The BC Court of Appeal in V.J.F. noted, however, that s. 85 of the FLA complicates the gifting of property between spouses when the property is derived from “excluded property”. To reconcile potential inconsistencies between the law of gifts and the FLA, the Court provided clarification in V.J.F. at paras. 74-75:
[74] With all due respect to the contrary view, I conclude that the new FLA scheme does not constitute a “complete code” that “descends as between the spouses” and eliminates common law and equitable principles relating to property. Rather, the scheme builds on those principles, preserving concepts such as gifts and trusts, and evidentiary presumptions such as the presumption of advancement between spouses. …
[75] I do not interpret the FLA as reversing the gift or requiring that it be ignored because of the spouses’ separation. Nor do I agree that the FLA effectively ‘prohibits’ gifts between spouses, as Mr. F. suggested. (See para. 56.) Gifts between spouses can continue as they have through the ages. It would take much clearer wording to render them suddenly revocable or null or illegal. (See the comments of Chief Justice Farris in a slightly different context in Duncan v. Duncan (No. 2) [1950] B.C.J. No. 50 at para. 13 (S.C.), aff’d [1950] B.C.J. No. 41. (C.A.).)
[Emphasis in original.]
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In Unger the Judge analyzed that half the home would remain excluded but the other half would be family property divided most likely equally. In essence, the husband, if they divorced, would have a strong claim to a 75/25 division of the family home he acquired with the excluded property but even then the wife might have succeeded on a significant unfairness argument. She would also get spousal support!
But he died while they were married so our highly rated Vancouver Spouse Unfair Will Variation Lawyers explain this makes a big difference.
[95] Applying V.J.F., I am of the view that for the purpose of this analysis the plaintiff’s 50% would have been presumed a gift under the common law. Further, the evidence supports that this presumption would have likely stood, as the Will is consistent with the finding of a gift, and no other evidence has rebutted it. As a result, the plaintiff’s 50% stake would not have been “excluded property” under the FLA – only the 50% held by Mr. Unger himself would have been “excluded property”. The plaintiff’s 50% stake would have instead fallen back into the communal pool as “family property”: see V.J.F. at para. 76. Therefore, the plaintiff’s family law claim to the Matrimonial Home would have been for at least 25% of its total value.
[97] In addition to property division, the FLA also states that a spouse is entitled to spousal support. Part 4, Division 7 provides that spouses have a duty to provide support in consideration of the conditions, means, needs, and other circumstances of the other spouse, including the length of time they lived together, the functions performed by each during this time, and any agreements between them: see ss. 160‑162. Based on the needs of the plaintiff, the length of her relationship with Mr. Unger, and the nature of their relationship, the plaintiff would have had a potential claim for support against Mr. Unger.
[98] Based on the preceding analysis, I am of the view that the plaintiff would have had a strong claim for both the division of property and spousal support per Mr. Unger’s uncrystallised legal obligations.
Vancouver Spouse Unfair Will Variation Lawyers Moral Duty
[99] In J.R. v. J.D.M., 2016 BCSC 2265, the Court set out the factors to consider in assessing the moral claim in a second marriage at para. 92:
In assessing the strength of the legal and moral obligations owed by a testator to a second spouse, the court will consider factors such as:
(a) The length of the marriage;
(b) When and how the testator’s assets were acquired;
(c) The contribution of the second spouse;
(d) How family assets would be divided under the applicable family legislation upon marriage breakdown;
(e) Competing obligations with the children from the first marriage;
(f) Financial circumstances of the spouse;
(g) The size of the estate; and
(h) The magnitude of assets passing to the spouse outside of the estate in consequence of other pre-death transactions undertaken by the testator.
[100] The moral duty of a testator in a second marriage was also considered by Russell J. in Saugestad v. Saugestad, 2006 BCSC 1839 [Saugestad] at paras. 121-130, varied on a different ground 2008 BCCA 38. An important consideration in determining the moral obligation owed to a second spouse is that spouse’s contribution to the estate as set out in Saugestad at para. 126.
Unfair Will Varied To Give Wife 30% of Estate Plus The Half Interest In Home
[101] Mr. Unger’s purported rationale for excluding the plaintiff from the Will was not valid. Clause 6 of the Will suggests that Mr. Unger caused 50% of the Matrimonial Home to be transferred to the plaintiff without any contribution by her to the acquisition or preservation of the property. The Matrimonial Home was initially registered in joint tenancy at the time of its purchase in 1981. It was only as a result of the order of Master Tokarek in the family law action that the joint tenancy was severed. Furthermore although the plaintiff did not financially assist in the payment of the purchase price she did make contributions to the preservation and enhancement of the Matrimonial Home in the 30 plus years of ownership.
[102] The legal and moral obligations that Mr. Unger owed the plaintiff are high. From a legal obligation she was his partner for 34 years, married for 32 years and remained with him despite his abusive conduct towards her. She looked after him to the best of her abilities and remained by his side until his death.
[103] In weighing the totality of the evidence in light of the legal principles, I conclude that Mr. Unger failed to discharge his legal and moral duty to his wife when he provided her with nothing under his Will. The testamentary autonomy of Mr. Unger must yield to this. These claims support that an “adequate, just and equitable” provision for her requires that she receive 30% of the residue of the estate. The remaining 70% will be equally distributed between the defendants. Given the circumstances of the joint bank account and the additional sums provided to the defendants, along with this residue, Mr. Unger’s moral duties to his adult children are satisfied.
In the end, the wife of a 34-year relationship received an additional 30 percent of the estate which consisted largely of the deceased’s share of the family home sale proceeds held in trust.
Call our highly regarded family law and Vancouver Spouse Unfair Will Variation Lawyers immediately if you feel you have been unfairly dealt with in a loved one’s Will. Strict deadlines exist so call now Toll free 1 877 602 9900
