Category: WESA Procedures

A descendant under WESA is defined in S 1 (1) as all of lineal descendants through all generations.

It in effect replaces the word “issue” that in S 85 of the Estate Administration Act had been defined as ” all lineal descendants of the ancestor”.

This may cause some confusion in the future due to the common use of the words in wills stating ” to my issue in equal shares per stirpes”, but I am sure that the courts can easily resolve with that.

Sections 23 and 24 deal with the distribution of intestate estates to descendants of a deceased.

No spouse but intestate leaving descendants or relatives

23 (I) This section applies if a person dies without a will and without leaving a surviving spouse.
(2) Subject to subsection (3) and section 24, if a person dies without leaving a surviving spouse, the
intestate estate must be distributed
(a) to the intestate’s descendants,
(b) if there is no surviving descendant, to the intestate’s parents in equal shares or to the intestate’s surviving parent,
(c) if there is no surviving descendant or parent, to the descendants of the intestate’s parents or parent,
(d) if there is no surviving descendant, parent or descendant of a parent, but the intestate is survived by one or more grandparents or descendants of grandparents, (i) an equal part to the surviving parents of each of the intestate’s parents, in
equal shares of the part, but if a parent of the intestate has no surviving parent, that part to the descendants of that grandparent in equal shares, and (ii) for the purpose of subparagraph (i), a part is determined by dividing the estate by the number of parents of the intestate who have
(A) a surviving parent, or
(B) a surviving descendent of the parent referred to in clause (A),
(e) if there is no surviving descendant, parent, descendant of a parent, grandparent or
descendant of a grandparent, but the intestate is survived by one or more great-
grandparents or descendants of great-grandparents,
(i) an equal part to the surviving grandparents of each of the intestate’s
parents, in equal shares of the part, but if a grandparent of the intestate has no surviving parent, that part to the descendants of that great-grandparent in equal shares, and
(ii) for the purpose of subparagraph (i), a part is determined by dividing the estate by the number of parents of the intestate who have
(A) a surviving grandparent, or
(B) a surviving descendent of the grandparent referred to in clause (A), or
(f) if there is no person who is entitled under paragraphs (a) to (e), the whole intestate
estate passes to the government and is subject to the Escheat Act.
(3) For the purposes of this section, persons of the 5th or greater degree of relationship to the
intestate are conclusively deemed to have predeceased the intestate, and any part of the intestate estate
to which those persons would otherwise be entitled must be distributed to other descendants entitled to
the estate.

Section 23 is a new provisions with a new approach called ” parentelic” that replaces the degrees of kinship that had been in S 85-89 of the Estate Administration act.

S 23 only applies where a decasew dies without a spouse, descendants, parents or descendants of parents surviving the deceased.

Under the parentelic system:

a) descendants of the nearest common ancestor always inherits before the descendants of a more distant ancestor;

b) distributions are more likely to be made on both sides of the family

c) the need to locate more distant relatives is lessened as only persons of the 4th degree or less in relationship to the intestate may inherit ( ie first cousins of the deceased would inherit, but not the children of first cousins as that would be more than the 4th degree. IF no one of 4th or lesser degree, then the assets escheat to the Crown.

Distribution to descendants

24 (I) When a distribution is to be made under this Part to the descendants of a person, the property that is to be so distributed must be divided into a number of equal shares equivalent to the number of
(a) surviving descendants, and
(b) deceased descendants who have left descendants surviving the person, in the generation nearest to the person that contains one or more surviving members.
(2) Subject to subsection (3), each surviving member of the generation nearest to the person that contains one or more surviving members must receive one share, and the share that would have been distributed to each deceased member if surviving must be divided among that member’s descendants in the same manner as under subsection (I) and this subsection.

(3) Distribution to descendants under subsections (I) and (2) as a result of a parent of the descendants having predeceased the intestate ends with the children of a brother or sister of the intestate.

Section 24 brings forward the policy of s. 84 of the Estate Administration Act to provide for per stirpes (or “by representation”) distribution to descendants, and expressly specifies the steps to determine per stirpal distribution.

The court does not have jurisdiction to vary the equal distribution, even though one of the children has engaged in offensive conduct: Andersson v. Khan Estate, 2006 BCSC 521, affirmed 2007 BCCA 532 (considering s. 84 of the EAA).

Distribution of Estate Assets

S155 (1) is similar to the six-month provision that had been in section 12 of the Wills Variation act, except for the fact that it is now being changed from six months to 210 days that assets of the estate cannot be distributed without the consent of all the beneficiaries and intestate successors or a court order.

S 155(2) is a new provision that prohibits the personal representative from distributing the estate after the 210 day waiting period without a court order if a court proceeding has been commenced ,as to whether a person is a beneficiary or an intestate heir, a variation claim has been brought, or other proceedings have been brought which may affect distribution.

155(1) The personal representative of a deceased person must not distribute the estate of the deceased person in the 210 days following the date of the issue of a representation grant except

(a) with the consent of all beneficiaries and intestate successors entitled to the estate, or
(b) by order of the court.
(2) The personal representative of a deceased person must not distribute the estate of the deceased
person after the period referred to in subsection (I) without consent of the court if
(a) a proceeding has been commenced to determine whether a person is or is not a beneficiary or intestate successor in respect of the deceased person’s estate,
(b) relief is sought under Division 6 [Variation of Wills] of Part 4 [Wills], or
(c) other proceedings have been commenced which may affect the distribution of the estate.

(3) Nothing in this section

(a) affects any right or remedy against a person to whom an estate has been distributed in whole or in part, or
(b) extends any applicable limitation period.

Distribution of minor’s interest
Some of the changes in section 153 make significant changes to what previously had been section 75 of the Estate Administration act.
The changes essentially:
a) expands the requirement to transfer the interest of minors in an estate for which no trust has been created from just money to all property in which the minor has an interest;
b) provides that, for property other than money, the Public Guardian and Trustee may convert the property to money, transfer the property to the minor, or decline to accept it and recommend that the court appoint a private trustee to hold it in trust until the minor turns 19;
c) permits the court to appoint a private trustee to hold a minors interest

153 (I) Subject to subsections (2) and (3), if

(a) a minor is a beneficiary or an intestate successor, and
(b) there is no trustee or no trust created for the minor’s interest in the estate,
the personal representative, on distribution of the estate, must pay or transfer the minor’s interest in the estate to the Public Guardian and Trustee in trust for the minor.
(2) If a minor’s interest in an estate consists, in whole or in part, of property other than money, the
Public Guardian and Trustee may
(a) convert the minor’s interest in the estate to money,
(b) transfer the minor’s interest in the estate to the minor, or
(c) decline to accept the transfer of the minor’s interest in the estate and recommend to the court that a trustee be appointed to hold and administer the minor’s interest in the estate until the minor reaches 19 years of age.
(3) Subsection (I) does not apply if, before distribution of the assets of the estate, the court, on
application and with notice to the Public Guardian and Trustee, appoints a trustee to hold and administer
the minor’s interest in the estate until the minor reaches 19 years of age.

PRIORITY RANKING OF POTENTIAL ADMINISTRATORS

This is a brand new provision to WESA.

The spouse has priority but may also nominate someone else , be it a child of the marriage or a financial institution, and that appointed party will have the same priority to be appointed the administrator.

The spouse does not require the consent of the children, nor does the person being appointed need consent.

One of the problems with the current Estate Administration Act was that it did not provide a list of persons entitled to apply for let¬ters of administration terms of who had first priority and had no guidelines at all with respect to who might apply successfully to be appointed administrator with will annexed.

Sections 130 and 131 of the WESA address these issues.

Under s. 130, the following have priority in the following order:

(a) the spouse of the deceased person or a person nominated by the spouse;
(b) a child of the deceased person having the consent of a majority of the chil¬dren of the deceased person;
(c) a person nominated by a child of the deceased person if that person has the consent of a majority of the deceased person’s children;
(d) a child of the deceased person not having the consent of a majority of the deceased person’s children;
(e) an intestate successor other than the spouse or child of the deceased person, having the consent of the intestate successors representing a majority in interest of the estate, including the intestate successor who applies for a grant of administration;
(f) an intestate successor other than the spouse or child of the deceased person, not having the consent of the intestate successors representing a majority in interest of the estate, including the intestate successor who applies for a grant of administration;
(g) any other person the court considers appropriate to appoint, including, without limitation, the Public Guardian and Trustee, subject to the Public Guardian and Trustee’s consent.

In the case of an administration with will annexed, the priority is as follows (s. 131):

(a) a beneficiary who applies having the consent of the beneficiaries represent¬ing a majority in interest of the estate, including the applicant;
(b) a beneficiary who applies not having the consent of the beneficiaries representing a majority in interest of the estate;
(c) any other person the court considers appropriate to appoint, including the Public Guardian and Trustee, subject to the Public Guardian and Trustee’s consent.

The court retains the ability to depart from these schemes in special circumstances (WESA, s. 132).

Special circumstances

This section is similar to the current s 7 of the Estate administration Act which permits the Court to ignore the hierarchy and appoint an administrator form elsewhere. This is especially the case with insolvent estates or other special circumstances

132 (I) Despite sections 130 and 131, the court may appoint as administrator of an estate any person the court considers appropriate if, because of special circumstances, the court considers it appropriate to do so.
(2) The appointment of an administrator under subsection (I) may be
(a) conditional or unconditional, and
(b) made for general, special or limited purposes.

In estate disputes, it is often disappointed beneficiaries or the intestate successors who failed to inherit that wish to contest the estate.

The personal representative of the estate, be it an executor or court appointed administrator, may refuse to initiate or defend a court action that interested parties wish to pursue.

Despite it being a common practice, there was some question as to the legal right to sue of such parties, in that sense they were not the legal representatives of the estate, they lacked the proper “standing.”

The decision of Doucette v. McInnes 2007 BCSC 289 resolve the issue by granting such interested parties the necessary standing to initiate or defend a court action should the personal representative refuse or neglect to do so.
Under section 151 of WESA, the court has granted a limited class of interested parties the ability to both pursue or defend claims on behalf of an estate once they have “leave” ( permission) of the court to do so

The requirements in order to obtain leave from the court are:

1) reasonable efforts must be shown to have attempted to cause the personal representative to commence proceedings;
2) has given notice to the personal representative, any other beneficiaries are intestate successors, and anyone the court directs;
3) is acting in good faith;
4) it appears to the court that it is necessary or expedient for the protection of the estate or the interests of the beneficiary for the proceeding to be brought or defendant

S151 Reads as Follows:

Beneficiary or intestate successor may sue with leave of court
151 (I) Despite section 136 [effect of representation grant], a beneficiary or an intestate successor may, with leave of the court, commence proceedings in the name and on behalf of the personal representative of the deceased person
(a) to recover property or to enforce a right, duty or obligation owed to the deceased person that could be recovered or enforced by the personal representative, or
(b) to obtain damages for breach of a right, duty or obligation owed to the deceased person.

(2) A beneficiary or an intestate successor may, with leave of the court, defend in the name and on behalf of the personal representative of a deceased person, a proceeding brought against the deceased person or the personal representative.
(3) The court may grant leave under this section if
(a) the court determines the beneficiary or intestate successor seeking leave
(i) has made reasonable efforts to cause the personal representative to
commence or defend the proceeding, (ii) has given notice of the application for leave to
(A) the personal representative,
(B) any other beneficiaries or intestate successors, and
(C) any additional person the court directs that notice is to be given, and (iii) is acting in good faith, and
(b) it appears to the court that it is necessary or expedient for the protection of the
estate or the interests of a beneficiary or an intestate successor for the proceeding
to be brought or defended.
(4) On application by a beneficiary, an intestate successor or a personal representative, the court
may authorize a person to control the conduct of a proceeding under this section or may give other
directions for the conduct of the proceeding.

WESA #19 – “Hotpotch” and Some Presumptions Eliminated

Common Law Presumptions Abrogated. Historically there has been a presumption that where there was a gift in a will, and after the will was made, the will maker made an inter vivos gift or promised to make a gift of roughly the same amount to the same person, the so-called “rule against double portions” would cancel out the right to a to a gift in the will or the promise if it had not been fulfilled.

If significant advances were made during a parents lifetime to a child,that may have been considered an advancement of an inheritance in the past, but this presumption will no longer be of effect.

Similarly if a will maker owes a debt to a creditor, and leaves a bequest in the will in the same amount or greater than the debt, the debt was presumed to be repaid by the legacy, and this will no longer be the case.

The aforesaid presumptions have now been abolished.

All of section 53 is subject to the contrary intention appearing in the will, or “otherwise”, and extrinsic evidence is admissible to prove this intention.

The Section States:

53(1) The presumption of law that a gift by a will-maker made during his or her lifetime to a child of the will-maker or to a person to whom the will-maker stands in place of a parent is an advancement of a portion that is intended to revoke a gift in the will-maker’s will in favour of the child or person is abrogated and the gift in the will takes effect according to its terms.
(2) The presumption of law that a legacy is revoked by a gift in the same amount as the legacy made by the will-maker during the will-maker’s lifetime is abrogated and the legacy takes effect according to its terms.
(3) The presumption of law that a debt owed by a will-maker is satisfied by a legacy to the creditor equal to or greater than the debt is abrogated and the debt continues to be a claim against the will-maker’s estate.
(4) The presumption of law that a binding promise by a person to make a gift to advance a child in life is satisfied to the extent of the benefit promised by a gift in the person’s will to the child is abrogated and the promise remains binding on the person and the person’s estate.

The current “hotpotch” provision as currently set out in section 92 of the Estate Administration Act, which provides that in an intestacy, where the child has been advanced a portion by the intestate, the portion must be taken into account when calculating the distribution to that child.

This provision has not been included in the new WESA

Gifts to Will Witnesses Can Be “Saved”

Section 11 of the current Wills Act provides that a witness to a will, or a spouse of the witness to the will cannot receive a gift under the will, as the gift will lapse.

For example currently if a will maker leaves the residue of his estate into three equal shares to three named persons, but one of the witnesses the will, the witnesses share passes on an intestacy.

Under WESA , section 43 however, the court is empowered with a “saving” provision as set out in section 43 (4).

What is puzzling, is not the only criteria to save the bequest, seems to be “if the court is satisfied that the will maker intend to make the gift to the person even though the person or his or her spouse was a witness to the will”.

S 43 (5) specifically allows for the introduction of extrinsic evidence for the purposes of establishing the will maker’s intention under subsection 4

it would seem that that would be the situation in almost every will situation except for lack of capacity undue influence and other equitable claims that may void the will.

Gifts to witnesses

43 (I) Unless a court otherwise declares under subsection (4), a gift in a will is void if it is to

(a)            a witness to the will-maker’s signature or to the spouse of that witness,

(b)       a person signing the will by the will-maker’s direction, or the spouse of the person signing, or

(c)        a person claiming under a person, other than the will-maker, referred to in paragraph (a) or (b).

(2)   For the purposes of subsection (I), the relevant time for determining whether one person is the spouse of another is the time when the will was made.

(3)      If a gift is void under subsection (I), the remainder of the will is not affected.

(4)      On application, the court may declare that a gift to a person referred to in subsection (I) is not void and is to take effect, if the court is satisfied that the will-maker intended to make the gift to the person even though the person or his or her spouse was a witness to the will.

(5)      Extrinsic evidence is admissible for the purposes of establishing the will-maker’s intention under subsection (4).

Marriage Will No Longer Revoke a Prior Will

For many decades now, marriage was able to revoke a prior will unless the will was made in contemplation of marriage to that future spouse. This was generally not known to the public and undoubtedly caused much hardship  in the form of unintended intestacy’s, or  unintended revocations of  wills.

Plus given the fact that so many couples now cohabit rather than legally marry, it simply made no sense to continue on with this law .

A marriage occurring on or after March 31, 2014 will no longer revoke a will,  as  section 15 of the current Wills Act currently provides.

Under section 16 of the current  Wills Act, if a spouse made a will leaving a gift to the other spouse,  and the spouses then divorced, the gift that spouse in the will would be revoked , subject to a contrary intention expressed in the will .

This will continue to be the case under WESA,  but section 56 goes further to state  that  again subject to a contrary intention expressed in the will , a gift to someone who is or becomes a spouse  is revoked if ” after the will is made in before the will maker’s death, the will maker and his or her spouse ceased to be spouses under section 2(2)

With respect to married spouses, a separation will be sufficient to revoke a gift in a will, because section 81 (B)of the family law act  provides that ” on separation, each spouse has a right to an undivided half interest in all family property –”

Court Has Flexibility to Structure Intestate Spouse to Better Afford to Continue Living In Matrimonial Home

As was recently blogged, under WESA on an intestacy, the surviving intestate spouse will no longer automatically be entitled to  a life interest in the matrimonial home.

Section 33 is a new provision that grants the court the power to structure an arrangement to permit the surviving spouse to continue to reside in the matrimonial home, when otherwise it would be financially near  impossible, or at least cause hardship, for the spouse to do so.

The court in this situation must also determine that forcing the spouse to leave the home would impose a greater prejudice on the spouse, than would be imposed on the descendents who would then be forced to wait until the spouse’s death to receive their shares of the estate.

In that situation the court also has power to allow any unpaid portion of the spousal home to accrue interest during the remainder of the surviving spouses life that will ultimately be paid to the descendants to have had to wait.

Retention of Spousal Home

33 (I) On application by a surviving spouse, the court may make an order under subsection (2) if

(a)       the surviving spouse is ordinarily resident in the spousal home at the time of the deceased person’s death,

(b)       assets in the estate are not sufficient to satisfy the interests of all descendants entitled to share in the intestate estate or that part of the estate that is to be treated as an intestate estate without disposing of the spousal home,

(c)        the court is satisfied that purchasing the spousal home under section 31 would impose a significant financial hardship on the surviving spouse,

(d)       the court is satisfied that, in all the circumstances, a greater prejudice would be imposed on the surviving spouse by being unable to continue to reside in the spousal home than would be imposed on the descendants entitled to share in the intestate estate or that part of the estate that is to be treated as an intestate estate by having to wait an indeterminate period of time to receive all or part of their share of the intestate estate, and

(e)       either

(i)     the surviving spouse has resided in the spousal home for a sufficient period of time to have established a connection to the spousal home, or

(ii)    the surviving spouse has a sufficient connection with the community or members of the community in the vicinity of the spousal home to warrant an order under subsection (2).

(2) The court may, subject to any terms or conditions the court considers appropriate, make an order doing one or more of the following:

(a)            vesting the same interest in the spousal home in the surviving spouse that the deceased person had;

(b)       specifying the amount of money the surviving spouse must pay to the descendants towards satisfaction of their interest in the estate;

(c)        converting the remaining unpaid interest of the descendants in the intestate estate into a registrable charge against the title to the surviving spouse’s interest in the spousal home;

(d)       determining an interest rate, as that term is defined in section 7 [interest rate] of the Court Order Interest Act, or at any other rate the court considers appropriate, for the amount the descendants are entitled to under paragraph (c) of this subsection;

(e)       determining the value of the registrable charge referred to in paragraph (c) to include the principal amount owing to the descendants entitled to share in the intestate estate or that part of the estate that is to be treated as an intestate estate and the expected value of the future interest that will be earned under paragraph (d).