Lafleur Estate (Re), 2014 ABQB 698

Court of Queen ’ s Bench of Alberta Citation: Lafleur Estate (Re), 2014 ABQB 698 Date: 20141113 Docket: ES03 130119 Registry: Edmonton Court File Number ES03 130119 Court Court of Queen’s Bench of Alberta (Surrogate Matter) Judicial District Edmonton Estate Name Bradley J. Lafleur Applicant (Plaintiff) Yuliya Lafleur Respondent (Defendant) Larry Lafleur _ ________________________________________ ______________ Reasons for Decision of the Honourable Madam Justice S.J. Greckol _________________________________________ ______________ I.

Introduction [ 1 ] The Applicant, Yuliya Lafleur, brings this application under the Dependants Relief Act , RSA 2000 c D-10.5, s 3. She claims that her deceased husband, Bradley J. Lafleur, failed to make adequate provision for her proper maintenance and support as his surviving spouse and dependant. The Respondent, Larry Lafleur, is Bradley’s father, the executor of his Will, and the Trustee of three Trusts established by the Will for the benefit of Yuliya (the Spousal Trust) and their two children (the ML Trust and the JL Trust).

There is also a Family Trust that was created prior to Bradley’s death that is untouched by the testamentary devices and is controlled by Yuliya alone. [ 2 ] Bradley, with Yuliya’s help and support, operated a business called Lafleur Cold Storage (LCS). It is the shares of LCS that are held in the three trusts established by the Will for the benefit of Yuliya and the two children. Mr. Lafleur is the sole director and president of LCS. He therefore controls payment of LCS dividends into the Family Trust and of LCS profits paid into three Trusts created by the Will from residue of the estate. Ms.

Lafleur seeks an order that the residue of the Lafleur estate be transferred to her for her proper maintenance and support, though Bradley’s testamentary intention was that the LCS Class E Preferred Shares be held in trust for

her future benefit and that of their two children. II. Facts [ 3 ] Bradley John Lafleur died November 26, 2008 at the age of 33 years. Bradley is survived by his wife, Yuliya Lafleur and their two minor children, Michelle Anne and John Bradley. [ 4 ] Bradley lived with Yuliya for four years before marriage, and they were married in 2004, four years before his death.

They had two children together, aged 4 and 2 at the time of his death, and by now aged about 10 and 8. [ 5 ] On January 1, 2006, Bradley and Yuliya were appointed Trustees of the B & Y Lafleur Family Trust under an inter vivos trust, created for the benefit of Bradley, Yuliya, Michelle and John. In 2006, Bradley owned 100% of Lafleur’s Cold Storage Inc. (“LCS”), a cold storage unit. At that point LCS had Class E Preferred shares and Class F shares. All the Class F shares were transferred to the Family Trust and they remain there to this day.

Bradley retained ownership of 625,000 Class E shares of LCS until his death. [ 6 ] Bradley’s Last Will and Testament was dated February 17, 2006. After his death in 2008, a Grant of Probate issued on November 4, 2009 naming Larry Lafleur, Bradley`s father, as the Personal Representative of the estate. [ 7 ] The Will, at paragraph 3(f), creates a trust for the benefit of Michelle and John (“the Children’s Trust”).

The Will directs that the Children’s Trust shall be funded using shares in the capital stock of companies that Bradley controlled with a net value of $500,000. [ 8 ] The Will provides: a. at paragraph 3(d), any property registered in the name of Bradley and Yuliya jointly, shall pass to Yuliya exclusively; b. at paragraph 3(e), all of Bradley’s personal possessions shall pass to Yuliya exclusively; and c. at paragraph 3(h), the residue of the estate shall be held in the Spousal Trust.

Upon death, any remaining proceeds of the Spousal Trust shall be transferred to the Children’s Trust to be administered by the Trustee (Larry Lafleur). [ 9 ] According to the NC 7 the net value of the estate is $484,068.61. [ 10 ] The assets totalling $745,002 are identified as: a. a condominium located in Edmonton valued at $120,000; b. Class E Preferred shares in LCS valued at $625,000; c. common shares in Ukrainian Drinks Ltd. valued at $1.00; and d.

Class “B” shares in Nexstar Systems Inc. valued at $1.00. [ 11 ] The NC 7 identifies various debts for a total of $260,933.39. [ 12 ] On May 3, 2010 a Consent Order was entered extending the period to file an application under the Dependants Relief Act to June 30, 2010. On June 30, 2010 an application for maintenance and support pursuant to the Dependants Relief Act was filed on behalf of Yuliya. An Affidavit sworn by Yuliya on June 29, 2010 was filed in support of the application (“Affidavit 1”). The application was adjourned sine die by consent.

A supplemental Affidavit sworn by Yuliya on November 22, 2013 was filed to support her application (“Affidavit 2”). Yuliya was questioned on her affidavits on December 10, 2013.

There was no financial disclosure other than that contained in the two Affidavits and answers to undertakings. [ 13 ] Certain assets fell outside of the estate and transferred to Yuliya by right of survivorship: a. real property located in Edmonton: i. 15408 -72 Street; ii. 15427 - 73 Street; and iii. 522 Dickens Loop; and b. various bank accounts. [ 14 ] Certain assets fell outside of the estate and passed directly to Yuliya through beneficiary designations: a. proceeds from a life insurance policy in the amount of $100,000; and b. an RRSP account worth $81,332.84. [ 15 ] Two of the three titles of real property located in Edmonton which Yuliya received by right of survivorship have been sold: 15408 - 73 Street and 15427- 73 Street.

The third, 522 Dickens Loop, was listed for sale at the time of this application. The value of 522 Dickens Loop according to the listing agreement is $639,900. The affidavit of Larry Lafleur indicates this property is unencumbered. [ 16 ] Yuliya states her assets as of November 12, 2013 are:

a. chequing account - $6,867.27; b. chequing account - $3,451.21 US funds; c. savings account - $55,673.70; d. investment account - $3,701.95; e.

RRSP account - $82,629.44; f. tax free savings account - $25,595.99; g. 2010 Mercedes ML350; h. real property: i. an interest in a condominium located at 103, 14808 26 Street Edmonton; ii. 672 Dartmouth Point, Edmonton - purchased in 2013 for $860,000 with a mortgage in the amount of $516,000; and registered as joint tenant with Gary Dvorkin, Yuliya’s partner. [ 17 ] Additionally, Yuliya identifies at paragraph 3.16 of Affidavit 2 that she is the sole shareholder in an Alberta numbered corporation 1728267 Alberta Ltd. She identifies that the numbered corporation has a bank account as its sole asset.

As of September 25, 2013, the account contained $377,171.44. The sum of $148,539.47 was withdrawn and applied to the purchase of 672 Dartmouth Point Edmonton. [ 18 ] In July of 2013, the shares of Tree Time Services Inc., held by the Family Trust, were repurchased for $414,000 and the funds paid to the Family Trust for the benefit of the three beneficiaries, Yuliya and the two children. [ 19 ] Yuliya has a gross monthly income of $5,870.83. This income is comprised of CPP payments, child tax benefits, rent and income from the Family Trust.

Larry Lafleur, as the sole director and president of LCS makes LCS dividend payments of $4,500 per month into the Family Trust for the support and maintenance of Yuliya and the children. Counsel for the executor argues that this amount is entirely within his discretion. Yuliya’s monthly expenses, not including costs associated with her rental property, total $8,348.63.

She identifies a shortfall of $2,477.80 per month. [ 20 ] The Public Trustee for the Province of Alberta (“Public Trustee”) was served with the Application on behalf of the minors, Michelle and John. [ 21 ] At my request, the parties provided further information concerning the Trusts, the ownership and control of LCS and the relevant history. Counsel provided this information by letters of July, 2014 and it is incorporated in the following

summary. There are four trusts in existence: the Family Trust, created prior to Bradley’s death as discussed above, and three Trusts created to fulfil Bradley’s declared intentions: a. B & Y Lafleur Family Trust [“the Family Trust”] - In 2006 Bradley Lafleur owned 100% of LCS. At this point LCS issued Class E Preferred shares and Class F shares. All the Class F shares were transferred to the Family Trust and remain there. The two children and Yuliya are beneficiaries of the Family Trust.

The sole Trustee is Yuliya who has full legal control of this Trust and has full authority to decide how best to distribute the funds held by the trust for the benefit of the three beneficiaries. This is an inter vivos gift, and therefore irrelevant to the operation of the Will. - The Family Trust held one third of the shares of Tree Time Services Inc.

In July of 2013 these shares were repurchased for $414,000 and the funds paid to the Family Trust to be used for the benefit of the three beneficiaries of the Trust: Yuliya, Michelle and John. - The Class F shares in LCS held by the Family Trust represent 0.032% of the voting shares in LCS. - The assets of the Family Trust are the cash left from the Tree Time Services transaction and the LCS Class F shares. - The Family Trust receives monthly dividends from LCS profits.

The amount of dividends paid out is determined by Larry Lafleur as sole director of LCS, at each year end (July 31 st ) in consultation with the accountants who do the year end financials for LCS. The amount paid at first was $4,000 per month for the daily maintenance of the three beneficiaries. It increased to $4,500 per month based on Yuliya’s application and the improved financial situation of the company. - According to counsel for Mr. Lafleur (and not disputed), the first priority is to pay monthly dividends on the Class F shares of LCS for the maintenance of the beneficiaries of the Family Trust.

Dividends paid on the Class E preferred shares to the children’s trust accounts and the Spousal Trust account are based on the remaining profits and vary from year to year. According to counsel (and not disputed) LCS is doing well and the dividends will remain stable for the next few years and then could increase by as much as $50,000 per year as the debts are paid off. b. Yuliya Lafleur Trust [“Spousal Trust”] - Bradley retained ownership of $625,000 worth of LCS Class E Preferred shares until his death in 2009.

At that point those shares were distributed into the three Trusts for the benefit of Yuliya, Michelle and John respectively, according to the instructions contained in the Will, that “shares in capital stock of companies I control to a net value of $500,000 be placed in trusts for his children”.

- Since the residue of the estate was to be placed in a Spousal Trust, the remaining 125,000 LCS Class E Preferred shares were allocated to the Spousal Trust. These represent just under 20% of LCS voting shares (with a face value of $125,000). - According to counsel for Mr. Lafleur, the funds accumulating in the Spousal Trust will be turned over to Yuliya once the estate is settled and the debts paid. Once that happens she will receive any future dividends each year. c.

Michelle Lafleur Trust [ “ ML Trust ” ] and John Lafleur Trust [ “ JL Trust ” ] - A total of 500,000 LCS Class E Preferred shares were allocated to the children, 250,000 to each of the ML and JL Trusts, representing just less than 40% of LCS ’ s voting shares (together these Trust shares have a face value of $500,000). - The funds in the Children’s Trust will be paid out as per the instructions in the Will: one-third at age 21, 50% of remaining at age 25 and the last portion at age 30. As well, the preferred shares and corresponding dividends will be transferred to them at the same rate.

In the meantime the funds are held in trust for them and can be drawn upon for needs such as post-secondary education costs. [ 22 ] Larry Lafleur, Bradley ’ s father, is the Trustee for all three of the latter trusts. He pays dividends from LCS into these three trust accounts located at the Alberta Treasury Branch. The accounts are held in his own name in trust for each of the three beneficiaries. [ 23 ] Yuliya ’ s application therefore relates to (

a) the bequest to the Children’s Trusts [3(f)] and to (

b) the residue of the estate comprised of anything remaining in the estate after the debts were paid. If successful in her application, she would receive the LCS Class E Preferred shares and the residue of the estate unencumbered by any trusts.

The Applicant seeks an Order: ... 3.3 Directing that the Executor pay, transfer (sic) and convey the entire estate available for distribution absolutely to the applicant, as proper and adequate maintenance and support, or such portion of the estate as this Honourable Court may direct; ... [ 24 ] If successful, Yuliya ’ s Application would result in her owning 100% of LCS shares and having complete control of that corporation. Presently, the LCS business is run by Larry Lafleur and he is empowered to vote the majority of its shares because of his position as Trustee.

As noted, he has distributed funds from LCS via two channels: monthly payments from LCS to the Family Trust (in effect, to Yuliya); and annual payments from the profits of LCS to the ML, JL, and the Spousal Trusts. III. Legislation [ 25 ] The relevant legislation is the Dependants Relief Act . That Act was repealed when the Wills and Succession Act , RSA 2010 c W-12.2 (“ WSA ”) was proclaimed in force on February 1, 2012.

However, the WSA , s 108(3) transitional provision indicates the Dependants Relief Act continues to apply where death occurred from June 2, 2003 to January 31, 2012. [ 26 ] Yuliya, Michelle and John are all dependants of Bradley.

Section 1 of the Dependants Relief Act defines “dependant” to include the spouse of the deceased and a child of the deceased who is under the age of 18 years at the time of the deceased’s death. [ 27 ] Dependants Relief Act , s 3(1) grants broad discretion to trial judges to override a will or the operation of the intestate succession procedures and order: ... any provision that the judge considers adequate be made out of the estate of the deceased for the proper maintenance and support of the dependants or any of them. [ 28 ] The Act contemplates a broad-based inquiry that can evaluate a wide range of evidence: 3(2) The judge on hearing the application (

a) may inquire into and consider all matters that the judge considers should be fairly taken into account in deciding the application, (

b) may in addition to the evidence adduced by the parties appearing direct any other evidence to be given that the Judge considers necessary or proper, and (

c) may accept any evidence that the judge considers proper of the deceased’s reasons, so far as ascertainable, (

i) for making the dispositions made by the deceased’s will, or (ii) for not making adequate provision for a dependent, including any statement in writing signed by the deceased. IV. Issues [ 29 ] The Applicant has framed the issues according to the two-part test set out in Dependants Relief Act , s 3:

a. whether the deceased, Bradley Lafleur, failed to make adequate provision for the proper maintenance and support of his spouse, Yuliya; and b. whether additional provisions should be made from the estate for the proper maintenance and support of Yuliya, pursuant to the provisions of the Dependants Relief Act . V. Analysis [ 30 ] Yuliya seeks to have property that was put in trust for her and the two children, the LCS Class E Preferred shares, transferred directly to her.

She says she needs this property to adequately provide for her children, and that as the mother and guardian of Michelle and John the requirements of herself and her children are one and the same: Woycenko (Estate of) , 2002 ABQB 640 at para 46 , 315 AR 291. [ 31 ] Bradley’s Will has a simple structure. Aside from specific bequests, none of which are a feature in this dispute, Yuliya is to receive all property she jointly owned with Bradley [Will, clause 3(d)] and all of Bradley’s personal property [Will, clause 3(e)]. [ 32 ] It is helpful to turn to the exact text of those gifts: 3(

f) Bequests to Children’s Trust I direct that my Trustees are to set up a Trust for the benefit of my child, MICHELLE LAFLEUR, and for any other children that might be born of myself and my spouse, YULIYA A. LAFLEUR, and for any child in utero at the date of my death. I direct that there shall be advanced and paid into his Children’s Trust shares in the capital stock of companies that I control with a net value of $500,000, and my Trustees are hereby authorized to determine which shares shall be transferred, and to claim the Enhanced Capital Gain Exemption as provided for under the provisions of the Income Tax Act of Canada in

section 110.6 . I direct that these shares are then to be transferred and conveyed to the Trust to be held and dealt with according to the terms of this my Will. There may be in addition, funds that are held jointly with myself and my Trustees or either of them, these funds shall be advanced and to be paid according to my direction to the Children’s Trust described or to the Spousal Trust that shall refer to below. If I do not issue written directions as to these funds, they shall pass to the Children’s Trust described. (

g) Trustees Powers Under Children’s Trust I direct that with regard to the Children’s Trust, that my Trustees shall have the right to liquidate, transfer and convey any assets, with the Trust, and shall have the right to cause the repurchase of any shares in the capital stock of any corporations, and that these proceeds shall be then retained by the Trust and invested by the Trust after allocation of any tax consequences to my children or the Trust. (

h) Residue to Spousal Trust The residue of my Estate is to be transferred and conveyed into a Spousal Trust for the benefit of my spouse, YULIYA A. LAFLEUR. YULIYA A. LAFLEUR alone shall be entitled to the income of the Trust and the capital of the Trust as shall be determined in the sole discretion of my Trustees . I direct my Trustees to administer the Trust so that my spouse is to be maintained as far as the ability of the Trust is able, in the matter and to which she has been accustomed during the course of our marriage .

Income from the Trust may be taxed in the Trust or allocated to my spouse in the sole discretion of my Trustees. Upon the death of my spouse, YULIYA A. LAFLEUR, I direct that all the remaining proceeds of the Trust shall be transferred and conveyed to the Children’s Trust that I have described herein. [Emphasis added.] [ 33 ] The use of the Children’s Trust is specified in clause 3(j): (

j) Payment to Children Upon each of my children attaining the age of 21 years, I direct that any Children’s Trust assets shall be separated into portions, and any assets that have not been distributed and paid to my children shall be advanced as follows: (

i) The equal part set aside for each child of mine is to be held in trust by my Trustee and invested, with the whole or such part of the income and any amount of the capital as my Trustee may decide to be used for the maintenance, education and benefit of that child until he or she reaches the age of 21 years at which time my Trustee is to transfer 33 1/3% of the principle amount then in trust to that child; (ii) The balance of the equal part set aside for the child is to remain in trust with the whole or such part of the net income and any amount of the capital as my Trustee may decide to be used for the maintenance, education and benefit of that child until he or she reaches the age of 25 years at which time my Trustee is to transfer one half of the remaining principle amount then in trust to that child; (iii) The balance of the equal part set aside for that child is to remain in trust with the whole or such part of the net income and any amount of the capital as my Trustee may decide to be used for the maintenance, education , and benefit of that child until he or she reaches the age of 30 years at which time my Trustee is to transfer the remaining amount held in trust for my child to him or her as the case may be. ...

[Emphasis added.] [34] Counsel for Yuliya argues that in the decision Tataryn v Tataryn (SCC), [1994] 2 SCR 807, 116 DLR (4th)193, the Supreme Court of Canada considered that the origin of dependants’ relief was in the women’s rights movement and that theneeds-based analysis of ‘adequate provision’ was rejected in favour of an analysis based on current societal norms (at paras 16, 24 and28). [35] Counsel for Yuliya has helpfully provided the important authorities in this area of law.

He relies on the principles set out inthe Tataryn decision to argue that Bradley’s legal obligations would have given her more than her current inheritance, as she would havebeen entitled to spousal and child support as well as a share in the family assets had the couple separated, unencumbered by a trustarrangement. As well, counsel notes that Bradley has a legal obligation to support Yuliya’s mother who he co-sponsored for permanentresidency. This involves a commitment to Canada to provide her basic requirements for ten years, up to November, 2018.

Counsel arguesthat Yuliya, as the surviving spouse, has the highest moral claim on the estate. [36] Counsel argues that, like the wife in the Tataryn case, the testamentary trusts in the present case fail to recognize Yuliya’sdeserved and desirable independence; they leave both her and the children vulnerable and at the mercy of the Trustee, a situation that isundignified and paternalistic. She is confined to such sums as he sees fit for the adequate provision for either her or the children. Thechildren are the only other claimants, and their needs become her needs.

She is an exemplary mother. [37] Counsel for the Estate argues that Bradley Lafleur made adequate provision for the proper maintenance and support of hisspouse. He has satisfied his legal obligations under an analysis viewed through the prism of the Divorce Act, R.S.C., 1985, c. 3 (2ndSupp.), and the Matrimonial Property Act, RSA 2000 c M-8 bearing in mind the exemptions that would apply. According to counsel,Bradley has left his spouse assets worth over $2,000,000, over half of which have been converted to her own use since the death ofBradley.

Counsel argues that Bradley satisfied his moral obligations as well, entrusting his father with the management of LCS so as toprovide for both Yuliya and the children for years to come. [38] I do not accept Yuliya’s argument that since she is the caregiver and guardian of her children, her interests and those of thechildren are the same, reliant upon the decision of Woycenko (Estate). That decision arguably ignores the eventuality that the spousemay remarry and the impact of remarriage on the children of the first marriage.

In this case, Bradley’s intention as derived from the Willwas to ensure that a portion of his estate would be preserved for the children of their marriage and would not be vulnerable to claims of athird party with who she becomes legally involved, such as a new partner.

She may choose to share all property that she owns with a newpartner, or she may be required to do so by the operation of matrimonial law, and her interests therefor would diverge from those of herchildren. [39] The issue is whether, in establishing the Trusts for distribution of the capital and income to the children and to Yuliya,Bradley failed to make adequate provision for the proper maintenance and support of his spouse.

The majority of the LCS Class EPreferred shares are held in trust for the children along with the annual profit; and the balance of the LCS Class E Preferred shares areheld in the Spousal Trust for Yuliya, along with her proportion of the annual profit.

The dividend income from the LCS shares flowsinto the Family Trust for the use and benefit of the three at the discretion of Yuliya. [40] Bradley’s stated intention is that funds be paid to the children for “... maintenance, education, and benefit ...” [Will, clause3(j)]; and that funds be paid to Yuliya so that she “... is to be maintained ... in the matter and to which she has been accustomed duringthe course of our marriage” [Will, clause 3 (h)].

Upon the children reaching the identified ages, the LCS Class E Preferred shares,together with any accrued income, will be transferred to them. [41] I note that the Will does not restrict access to trust investment proceeds, or capital. The Trustee is therefore fully authorized tomake payments to Yuliya and the children, where appropriate for their care and maintenance. The Trustee has absolute discretion to meetthose objectives without restriction on his authority. For example, the Will does not instruct the Trustee to withhold or ration release oftrust assets, despite there being a genuine need for support.

Therefore, Yuliya can make an application, short of varying the trust, tocompel the Trustee to distribute more to her or to her children if she thinks the Trustee is acting unreasonably. [42] In Re: Tomich Estate 2011 ABCA 186, 338 DLR (4th) 741 [“Tomich”] the Alberta Court of Appeal confirmed that despitethe difference in language between the statute considered in Tataryn, and the Alberta statute, Tataryn lays out many of the applicableprinciples, summarized as follows, at para 17: 17 The leading decision of Tataryn discusses a number of principles: * What is "adequate" goes beyond the bare "necessities", and the statute does not contemplate a "needs-based" test.

An award under theAct can take account of the family's lifestyle and the claimant's realistic expectations [pp. 816, 819]; * The statute attempts to balance the interests of testamentary autonomy with the need to provide economic protection to survivingfamily members. Neither of these values can outweigh the other. Where possible, the court should attempt to recognize both interests[pp. 815-6, 823-4]; * An award under the Act should not only consider the legal obligations of the deceased towards the family, but should also have regardto the moral obligations of the deceased.

The law recognizes a moral obligation to a surviving spouse and dependent children, and alesser obligation to adult children [pp. 820-1, 822-3]; * What is "adequate" must be measured against contemporary community standards, having regard to what "a judicious person would doin the circumstances, by reference to contemporary community standards" [pp. 814, 820-1]; * The extent to which all the legal and moral claims can be met will depend on the size of the estate.

On the other hand, because there isno longer any need to provide support for the deceased, the surviving family members may be entitled to more than the support theywould have received during the deceased's lifetime [p. 823];

* The statute gives the court a wide ranging discretion [pp. 814-5]. [43] The Court in Tomich also summarized the Tataryn approach to balancing the competing values of testamentary autonomyand legitimate claims and expectations of surviving family members, at para 24: 24 In Tataryn the Supreme Court noted the competing values of testamentary autonomy and the legitimate claims and expectations ofsurviving family members. The Court made a number of observations on this subject. Firstly, the Court noted at p. 823 that where theestate permits, both objectives should be achieved.

Secondly, the Court indicated at pp. 823-4 that there is a range of estate plans thatwill satisfy the legal and moral obligations of the testator, and that "provided that the testator has chosen an option within this range, thewill should not be disturbed", and the "will may provide a framework for the protection of the beneficiaries". Thirdly, the Court directedthat the freedom of the testator to dispose of his property should be interfered with only so far as the statute requires. Fourthly, the courthas a wide ranging discretion.

In this case the parties took extreme positions: the appellant asked that the whole of the undistributedestate be given to her unconditionally, whereas the respondents argued that no provision at all should be made.

The court is not bound bythese positions, and may formulate any creative solution that fits the circumstances of the particular estate. [44] The Court of Appeal had earlier reviewed some of the factors to be considered in determining what is adequate support for adependant in Boje v Boje Estate 2005 ABCA 73 at para 21, 250 DLR (4th) 271: 21 Factors to be considered in determining what is adequate support for a dependant were outlined in Pauliuk, supra, and applied toadult dependants in Stone Estate (Public Trustee of) v. Stone Estate (1994), (AB KB), 154 A.R. 307 (Q.B.)("Stone").

Those factors include: size of the estate, needs of other dependants, age and state of health of the dependant, station in life ofthe parties, character of the applicants, likelihood of the dependant's needs increasing, likelihood of inflation, mode of life to which thedependant ought to be accustomed, cost of living, the dependant's other sources of income, and other claims against the estate. InDupere, supra, ‘future contingencies’ was added to the list of factors. [45] Those factors, though not intended to be exhaustive, yield this financial profile: a.

Size of the estate: The net value of the estate according to the NC7 filed with the application for probate is $484,068. Assetstotalling $754,002 are identified as including an Edmonton condominium valued at $120,000 and LCS Class E Preferred shares valued at$625,000. Since then, some of the debts have been paid. LCS Class E Preferred shares in a total amount of $500,000 are held in trust forthe benefit of the children; and the balance of LCS Class E Preferred shares valued at $125,000, held in the Spousal Trust for the benefitof Yuliya.

In the supplemental materials provided at my request, counsel indicated that the “...funds in the Spousal Trust will be turnedover to the Applicant once the estate is settled and the debts paid. Once that occurs she will receive any future dividends directly eachyear”. b. Needs of other dependents: As noted above, Yuliya’s needs may diverge from those of the children. However, they coincide in thatthe children will require support from their mother until they are independent, and will require financial resources for post-secondarytraining or education. c.

Character of the Applicant: Yuliya’s character is not challenged in these proceedings. I proceed on the basis that her character isbeyond reproach. She worked with Bradley in the joint family enterprise, as mother and full-time caregiver of their children, and throughcontributions to the family business, as the circumstances permitted. Her desire to be independent and assume full control over the familyresources is completely understandable. This is a feature of modern times: within reason, she should be free to determine her ownfinancial destiny and that of her children. d.

Other dependents: The children are now aged about 10 and 8 years old. As noted, I assume that they will pursue post-secondaryeducation as necessary to enjoy a standard of living commensurate with that provided for them by their parents. Their needs for financialsupport will increase as they grow older, as will the cost of living and, given current trends, the costs of post-secondary education. e.

The standard of living to which Yuliya has become accustomed: It is fair to deduce, from the assets either jointly owned by Yuliyaand Bradley, or included within Bradley’s estate, that the family enjoyed a very comfortable standard of living. Yuliya was accustomedto this, as is demonstrated by her current budget set at over $8,000 per month, the value of the former family home, as well as the valueof the current residence she shares with her common law spouse. f. Yuliya`s other sources of income: Yuliya has completed upgrading at NAIT. She has held part time employment in the past.

Thereis no current information as to whether she is presently employed, though her children are of an age where she would be able to work, atleast part time. Yuliya receives $4,500 per month in dividends from LCS. She says she has a shortfall each month of some $2,000. It doesnot seem unreasonable to expect that she can earn that amount of money each month through employment in the buoyant Albertaeconomy. Further, Yuliya is presently co-habiting with a person who is employed as a real estate agent and with whom she has a sharedinterest in a home.

Though his financial circumstances are not revealed, it is apparent that he, too, is a person of means given the valueof the home they have purchased together. The amount of property that Yuliya received as a result of survivorship or insurance proceeds must also be considered. As far as I candecipher, Yuliya received the following assets upon Bradley`s death by right of survivorship or bequest outside of the estate: threeproperties, including the family home at Dickens Loop; various bank accounts; and life insurance.

Presently, after some liquidation,according to her evidence, she owns: - chequing account - $6,867.27; - chequing account - $3,451.21 US funds; - savings account - $55,673.70; - investment account - $3,701.95;

- RRSP account - $82,629.44; - tax free savings account - $25,595.99; - 2010 Mercedes ML350; - real property: - an interest in a condominium located at 103 — 14808 26 Street Edmonton (value undisclosed); - 672 Dartmouth Point, Edmonton - purchased in 2013 for $860,000 with a mortgage in the amount of $516,000; registered in joint tenancy with her present partner; with $344,000 equity of which a half interest amounts to about $172,000; and - a home at Dickens Loop listed for sale at a value of $639,999. - an interest in 1728267 Alberta Ltd. ($377,171 less $148,539 paid for Dartmouth Point home), or $228,632.

Yuliya has property valued at about $1,218,547. In addition, she has an interest in the condominium on 26 St. that is not valued in the evidence; the condominium in the estate valued at $120,000 and not yet transferred to her at date of this application; her interest held in the Spousal Trust which is comprised of LCS Class E Preferred shares valued at $125,000 and any profits on that; as well as dividends, if any, held in the Family Trust. Therefore, her assets amount to at least $ 1,500,000. g.

There are no other claims against the estate, though I recognize that as a family, Bradley and Yuliya undertook to care for and support Yuliya’s mother. Her budget includes the costs of the support of her mother. [ 46 ] Given the financial profile that has emerged, I am satisfied that Bradley has met his legal obligations to Yuliya: she has received in excess of one half the total family assets and she will receive monthly income tantamount to spousal and child support into the future. She is a young woman and has the opportunity for a full career ahead of her.

Her children are in school and she may work if she so chooses. Bradley has also met his moral obligation to his dependants in that he has bequeathed his entire estate to his wife and their children for their benefit. [ 47 ] I accept the evidence that Bradley established Trusts through the Will to secure income adequate to the on-going needs of his wife and children, and the future educational needs of his children, against any incursion upon those assets by a third party that might be able to lay claim to them by dint of a relationship with Yuliya.

This was Bradley`s testamentary intention. [ 48 ] According to the principles of Tataryn , and the statute that governs this decision, I must attempt to balance the interests of testamentary autonomy with the need to provide economic protection to surviving family members. Neither of these values can outweigh the other. Where possible, both interests should be recognized. [ 49 ] In balancing those interests, I acknowledge the goals of Bradley in protecting the family assets for Yuliya and the children from any interloping claimant – that intention must be respected.

It is consistent with the need to provide economic protection to his three surviving family members. He has left Yuliya at least $1,500,000 worth of assets, and not all asset values have been quantified in this application. He has left shares in LCS with a value of $500,000 for the future of his two children.

He has placed these assets in trust so that there is on-going income stream derived from the LCS shares to provide basic support for his three dependants into the future. [ 50 ] I am satisfied that leaving the LCS Class E Preferred shares in the Spousal, ML, and JL Trusts in the care of the Trustee, Larry Lafleur, properly balances the interests of testamentary autonomy with the need to provide economic protection to surviving family members. [ 51 ] The statute imposes the standard upon Bradley Lafleur that he make adequate provision for the proper maintenance and support of his spouse.

What is “adequate” must be measured against contemporary community standards, having regard to what “a judicious person would do in the circumstances, by reference to contemporary community standards” as described by the Court in Tomich at para 17 , relying upon Tataryn at 814 and 820-821. [ 52 ] As I have said, community standards dictate that Yuliya be able to make a life for herself, freely and independently. However, another feature of contemporary community standards is the fluidity of familial relationships, and the fact that family ties are undone as readily as they are made.

I must take into account the prospect that though Yuliya’s domestic partnership may change, the nuclear family shaped by she and Bradley will continue to benefit from Bradley’s intention to provide for them, regardless of outside influences or the different shapes the family may take in future. [ 53 ] I recognize that the real issue is that though Yuliya and her children are already beneficial owners of the Class E Preferred shares, the majority of its shares are voted by Larry Lafleur.

He runs the LCS business and he distributes funds from LCS by monthly dividend payments to the Family Trust and the annual payments from LCS profits to the ML, JL, and Spousal Trusts. Yuliya would prefer to have absolute control over this business and its profits. However, in my view, there is no basis in law to effect that result. [ 54 ] If Yuliya does indeed require additional financial support, short of varying the trust, she may make application to compel the Trustee to distribute more income to her or to her children based upon the contention that the Trustee, Larry Lafleur, is acting unreasonably.

The appropriate mechanism to challenge administration of a trust is an application under Trustee Act , RSA 2000, c T-8, s 42 to vary or revoke the trust. As the beneficiary of the Spousal Trust and guardian of the two children, Yuliya has authority to make that application (s 42(5) (a)) and unique authority approve its substance (s 42(6)). [ 55 ] The Will provides that the residue of the estate, as well as profits from LCS, be transferred to the Spousal Trust but the Trust that remains under the control of Larry Lafleur.

Counsel for the Estate has indicated that after the debts are satisfied, any other assets remaining in the residue of the estate will be transferred to Yuliya for her own use absolutely. However, in my view, Yuliya should have

control of the Spousal Trust except for that portion of it which is comprised of the LCS Preferred Class E shares: it is neither practicable nor wise to remove control of that resource from the Trustee since the majority of the voting shares are held in trust for the children and will remain so, and as a result Larry Lafleur will continue to run the LCS business operations. [ 56 ] Given the facts concerning Yuliya`s personal and financial circumstances, and the testamentary intentions of her deceased husband, the father of her children, I find that, in the main, Yuliya has not demonstrated that Bradley Lafleur failed to make adequate provision for the proper maintenance and support of her so as to warrant additional provision from the LCS Preferred Class E shares.

However, the broad

interpretation of the term “adequate provision” in the Dependants Relief Act , as commended by Tataryn , involves contextual judgment based on contemporary community standards. This approach suggests, as noted, that Yuliya should be able to make a life for herself, freely and independently. Therefore, I direct that any property held in the Spousal Trust be in the absolute control of Yuliya, except for the LCS Preferred Class E shares. VI.

Conclusion [ 57 ] The application brought by Yuliya Lafleur to vary the Will of Bradley Lafleur under the terms of the Dependants Relief Act is granted to the limited extent that the residue of the estate and any property held in the Spousal Trust, save and except the LCS Class E Preferred shares, will be transferred to her for her own use absolutely. VII. Costs [ 58 ] If there is no agreement as to costs payable for this application, the parties may seek a special hearing for that purpose. Heard on the 20 th day of March, 2014. Dated at the City of Edmonton, Alberta this 13 th day of November, 2014. S.J.

Greckol J.C.Q.B.A. Appearances: J. Cameron Prowse, Q.C. Prowse Chowne LLP for the Applicant Timothy Snyder Snyder & Associates LLP for the Respondent Stacy K. Hennings Office of the Public Trustee for the Public Trustee