This Blog was written by: Alicia Mossington (Godin), Estate and Trust Consultant, Scotia Wealth Management 

In December this author wrote about the common law forfeiture laws, colloquially known as “Slayer Law”, which precludes an individual from deriving a benefit from their own “morally culpable conduct.” In the context of the testator-beneficiary relationship, a beneficiary who is found to have caused the unlawful death of a testator will be deemed at common law to have predeceased the testator, thereby extinguishing any interest in the testator’s estate.[1] This “slayer rule” extends further to prevent any person who wrongfully kills another to profit as a result of the deceased person’s death.[2]

A recent high-profile case dealt with this issue. Dellen Millard was the heir of the Millard family fortune, namely MillardAir and Millard Properties Ltd. His father Wayne Millard died in November 2012. The death was originally attributed to suicide but police later suspected that Mr. Millard had been murdered by his son Dellen following investigations into the killings of Tim Bosma and Laura Babcock.[3] Dellen was charged with his father’s death in 2014 and convicted in 2018.

The application of the slayer rule would disentitle Dellan from the inheritance.

Could a testator preclude a beneficiary from inheriting for other reasons, such as a requirement that they do or do not fulfil a condition?

Although it is a widely accepted principle that prior to being absolutely free to dispose of ones assets, a testator must (among other requirements) make bequests that do not offend public policy. A condition precedent is a condition (or event) that must occur before the trust comes into existence or before a trustee can distribute property in favour of a particular beneficiary. With a condition subsequent the trustee can distribute property to a beneficiary unless (or until) the condition occurs.

Recent cases broadened what kind of conditions may offend public policy, who may be an unworthy heir and the evidence that could be relied upon to prove “worthiness.”

Consider the bequest:    “I direct that the residue of my estate be transferred to my son provided that he has not been convicted of a criminal offence as of the date of my death.”

The court considered a similar condition of restraint of criminal activity in the 2005 case of Woods Estate v Woods[4] where the testator gifted a house to his son David, provided David had not been convicted of a criminal offence before reaching the age of 21. If he had been convicted, the house was to be sold with the proceeds divided among two other sons. This condition was upheld and not considered contrary to public policy. David was convicted of criminal offences when he was a minor and was thus denied the gift.

In 2014 the decision in McCorkill v Streed, Executor of the Estate of Harry Robert McCorkill was released. McCorkill did not have any immediate family and through his Will, made an unconditional gift to the National Alliance, an American neo-Nazi organization with a well-known mission founded in hate and violence. The Court noted that the actions of the National Alliance would constitute hate speech if conducted in Canada, in violation of the Criminal Code, and therefore the Will was voided on the grounds of public policy. The appeal was dismissed.[5]

As Weigl & Malik conclude in their paper, the motivation underlying a bequest and devise made by a client will be scrutinized more intently as will bequests to heirs who may be seen to be “unworthy” in the eyes of another interested party[6]… such as a beneficiary with a criminal record.

 

[1] “The Common Law Slayer Rule.” (Hull, 2017) Retrieved from https://hullandhull.com. Accesssed Dec 1, 2020.

[2] See Oldfield v Transamerica Life Insurance Co. of Canada (SCC) or Demeter v Dominion Life Assurance Co. (ONCA)

[3] How the slayer rule could keep millions of dollars away from Millard’s victims (Carter, Adam) CBC News. Retrieved from: https://www.cbc.ca/news/canada/toronto/millard-inheritance-1.4748923.

[4] 2005 CarswellOnt 5947 (ONCA) with a comprehensive brief in: de Vries et al. “Unusual Will Clauses and Oddball Estate Cases” (2013, Law Society of Upper Canada).

[5] Weigl, C & Malik. “Public Policy Limits in Estate Planning and Administration” (2015, Law Society of Upper Canada).

[6] Ibid at page 12.