Craigmile Estate (Re), 2016 ABQB 125

Court of Queen ’ s Bench of Alberta Citation: Craigmile Estate (Re), 2016 ABQB 125 Date: 20160302 Docket: ES01 115188 Registry: Calgary Between: The Public Trustee for the Province of Alberta, Trustee of the Estate of Kelly Lorne Craigmile Applicant - and - Sherry McCorriston, Calgary Health Trust, Heart and Stroke Foundation of Canada and Schizophrenia Society of Alberta Respondents _______________________________________________________ Memorandum of Decision of the Honourable Mr. Justice W. Tilleman _______________________________________________________ I.

Introduction and Background [ 1 ] This is an application by the Public Trustee for increased maintenance and support for Kelly Lorne Craigmile. Mr. Craigmile is 58 years old and has bi-polar disorder, schizophrenia, hepatitis C and drug abuse tendencies. He is represented by the Public Trustee, acting as his trustee, and by the Public Guardian, acting as his guardian; the presence of both of whom confirms to my satisfaction that Mr. Craigmile is disabled and unable to earn a living. [ 2 ] Mr. Craigmile’s mother, Eva Mary Craigmile, died in 2013.

Probate has issued and the net value of the estate is just short of $800,000, the largest portion of which is a House (the “House”) valued at roughly $300,000. Under her will, Mrs. Craigmile left her only child, Mr. Craigmile, half of the proceeds of accounts at CIBC and RBC (totalling $193,000), as well as a life interest in the House. The named charitable respondents also were to receive portions of the bank accounts. Additionally, the Schizophrenia Society was to get the House after Mr. Craigmile’s death.

[ 3 ] Currently, Mr. Craigmile receives AISH and other public assistance in the amount of $1,600 per month, which falls short of his overall monthly expenses. The Public Trustee, who has been managing the money to my satisfaction, now seeks additional funds for Mr. Craigmile. The evidence of the Public Guardian is that additional funds are required for companionship, clothing, grief counselling, vacation, recreation, a car, and maintenance of the House, the latter of which could be a significant cost. The Public Trustee had set up a Trust Fund of $42,500 which is now in decline.

I note that there is no suggestion that Mr. Craigmile could not take care of the House, only that there are insufficient funds to do so. II. Issue [ 4 ] Should the Public Trustee, on behalf of Mr. Craigmile, receive additional maintenance and support from the estate of Mrs. Craigmile by reason of Mrs. Craigmile having made inadequate provision in her will for Mr. Craigmile? III.

Statute Law [ 5 ] The Wills and Succession Act, SA 2010, c W-12.2 (“WSA”), defines family member as follows: 72(b) “family member” means, in respect of a deceased, ... (iv) a child of the deceased who is at least 18 years of age at the time of the deceased’s death and unable to earn a livelihood by reason of mental or physical disability, ... [ 6 ] The WSA provides for maintenance and support of family members as follows: 88(1) If a person (

a) dies testate without making adequate provision in the person’s will for the proper maintenance and support of a family member, or (

b) dies either wholly or partly intestate and the share to which a family member is entitled under a will or

Part 3 or both is inadequate for the proper maintenance and support of the family member, the Court may, on application, order that any provision the Court considers adequate be made out of the deceased’s estate for the proper maintenance and support of the family member...

(3) The order may be made in respect of all or any part of the estate, and regardless of whether there is a will or intestacy. [ 7 ] An application for maintenance and support may be made pursuant to s. 90 of the WSA : 90 An application under this Division may be made by a family member on his or her own behalf or (

a) in the case of a family member who is under 18 years of age, on behalf of that family member by: (

i) the family member’s parent or guardian, (ii) the Public Trustee, or (iii) any other person in accordance with the Alberta Rules of Court or the Surrogate Rules made under the Judicature Act , or (

b) in the case of a family member who is a represented adult or an incapacitated person, on behalf of that family member by (

i) the family member’s trustee, or (ii) any other person in accordance with the Alberta Rules of Court or the Surrogate Rules made under the Judicature Act . [ 8 ] In considering an application for maintenance and support, the Court must take into account the factors set forth in s. 93 of the WSA : 93 In considering an application for the maintenance and support of a family member, the Court shall consider, as applicable, (

a) the nature and duration of the relationship between the family member and the deceased,

(

b) the age and health of the family member, (

c) the family member’s capacity to contribute to his or her own support, including any entitlement to support from another person, (

d) any legal obligation of the deceased or the deceased’s estate to support any family member, (

e) the deceased’s reasons for making or not making dispositions of property to the family member, including any written statementsigned by the deceased in regard to the matter, (

f) any relevant agreement or waiver made between the deceased and the family member, (

g) the size, nature and distribution of (

i) the deceased’s estate, and (ii) any property or benefit that a family member or other person is entitled to receive by reason of the deceased’s death, (

h) any property that the deceased, during life, placed in trust in favour of a person or transferred to a person, whether under anagreement or order or as a gift or otherwise, and (

i) any property or benefit that an individual is entitled to receive under the Matrimonial Property Act, the Dower Act or Division 1of this Part by reason of the deceased’s death, and may consider any other matter the Court considers relevant. [9] Section 96(1) of the WSA sets out the Court’s authority to make an order and allows the Court to impose any conditions andrestrictions it considers appropriate: 96(1) The Court may, in making an order for maintenance and support, impose any conditions and restrictions that the Court considersappropriate and may (

a) direct that provision for maintenance and support be made out of and charged against the estate in the proportion and in themanner that the Court considers appropriate, (

b) direct that provision for maintenance and support be made out of income or capital, or both, in one or more of the followingways: (

i) by an amount payable annually or otherwise; (ii) by a lump sum to be paid or held in trust; (iii) by transfer or assignment of a specified property, whether absolutely or in trust and whether for life or for a term of years, to orfor the benefit of the family member. IV. Case Law [10] The Public Trustee referred the Court to a few cases, the first being Tataryn v Tataryn Estate (SCC), [1994]2 SCR 807. Counsel also referenced the cases of Carter v Alberta Conference Corp of the Seventh Day Adventist Church [1998] AJ No1479 and Soule v Johansen Estate, 2011 ABQB 403, 521 AR 238.

In Carter, the Court considered an application under the then FamilyRelief Act and held at para 18 that “The key words coming out of this

section are ‘Adequate provision for the proper maintenance andsupport of the dependent.’” [11] Like Mr. Craigmile, the applicant in Carter suffered from bipolar disorder. Hutchinson J. found that this was a disablingcondition and said at paras 23 and 24: I find that the applicant, Donald Carter, being a child of the deceased over the age of 18 years at the time of the deceased’s death wasthen and is now unable by reason of mental disability to earn a livelihood.

No convincing evidence to the contrary has been submitted.Confirmation that he is disabled, apart from his own testimony, comes from the two sources from which he is presently receivingdisability income. One from Great West Life Assurance Company and the other from the administrators of the Canada Pension Plan. Neither one of these sources is inclined to pay disability unless compelled to do so.

If judicial notice is required of the fact that bipolardisorder can be disabling then I am prepared to take such notice. ... [12] Justice Hutchinson reviewed older case authorities and concluded it was appropriate to direct all of the residue of the estate tobe paid to the applicant for his use entirely. [13] In Stadler v MacDonald, 2001 ABQB 408, 290 AR 179, where a life estate was in issue, the Court said this at paras 21 – 22:

While the court appreciates the respondents’ willingness to settle the matter, it is precisely these sorts of concerns that make a life estateimpractical. As remaindermen the respondents will continually be second guessing Mr. Stadler’s actions for fear of their interest beingeroded. I conclude that given the size of the estate and the strength of the legal and moral claims of Mr. Stadler, that adequate provision for theproper maintenance and support of Mr. Stadler is to transfer the home to him. [14] In Soule, the Court commented at para 47 about the obligations of a parent to a disabled child: Mrs.

Johansen owed both legal and moral obligations to her son during her lifetime and at her death and owed neither to her chosenbeneficiary. Community standards support the recognition of support obligations of parents towards their children. ..... In seekingcontemporary justice most would say that a parent’s estate should not benefit a charity when that person’s child is permanently disabledand lives on government assistance.

In Petrowski Moen J. said at para 521: Uniformly, Alberta courts appear to conclude that the assistance offered by the state to disabled persons does not discharge a parent’sobligation to provide support in a will... [15] Regarding moral decisions and competing claims, the Supreme Court of Canada in Tataryn v Tataryn Estate (SCC), [1994] 2 SCR 807 at ps 821-824 set out these principles, applicable in Alberta: ...The legal obligation of a testator may also extend to dependent children. ...

The legal obligations which society imposes on a testatorduring his lifetime are an important indication of the content of the legal obligation to provide "adequate, just and equitable"maintenance and support which is enforced after death. For further guidance in determining what is "adequate, just and equitable", the court should next turn to the testator's moral duties towardspouse and children. It is to the determination of these moral duties that the concerns about uncertainty are usually addressed.

Therebeing no clear legal standard by which to judge moral duties, these obligations are admittedly more susceptible of being vieweddifferently by different people. Nevertheless, the uncertainty, even in this area, may not be so great as has been sometimes thought. Forexample, most people would agree that although the law may not require a supporting spouse to make provision for a dependent spouseafter his death, a strong moral obligation to do so exists if the size of the estate permits.

Similarly, most people would agree that an adultdependent child is entitled to such consideration as the size of the estate and the testator's other obligations may allow. While the moralclaim of independent adult children may be more tenuous, a large body of case law exists suggesting that, if the size of the estate permitsand in the absence of circumstances which negate the existence of such an obligation, some provision for such children should be made:Brauer v. Hilton (1979), (BC CA), 15 B.C.L.R. 116 (C.A.); Cowan v.

Cowan Estate (1988), 30 E.T.R. 216 (B.C.S.C.),aff'd (1990), 37 E.T.R. 308 (B.C.C.A.); Nulty v. Nulty Estate (1989), (BC CA), 41 B.C.L.R. (2d) 343 (C.A.). See alsoPrice v. Lypchuk Estate, supra, and Bell v. Roy Estate (1993), (BC CA), 75 B.C.L.R. (2d) 213 (C.A.) for cases wherethe moral duty was seen to be negated. How are conflicting claims to be balanced against each other? Where the estate permits, all should be met.

Where priorities must beconsidered, it seems to me that claims which would have been recognized during the testator's life -- i.e., claims based upon not onlymoral obligation but legal obligations -- should generally take precedence over moral claims. As between moral claims, some may bestronger than others. It falls to the court to weigh the strength of each claim and assign to each its proper priority. In doing this, oneshould take into account the important changes consequent upon the death of the testator.

There is no longer any need to provide for thedeceased and reasonable expectations following upon death may not be the same as in the event of a separation during lifetime. A willmay provide a framework for the protection of the beneficiaries and future generations and the carrying out of legitimate social purposes.Any moral duty should be assessed in the light of the deceased's legitimate concerns which, where the assets of the estate permit, may gobeyond providing for the surviving spouse and children. I add this.

In many cases, there will be a number of ways of dividing the assets which are adequate, just and equitable. In other words,there will be a wide range of options, any of which might be considered appropriate in the circumstances. Provided that the testator haschosen an option within this range, the will should not be disturbed. Only where the testator has chosen an option which falls below hisor her obligations as defined by reference to legal and moral norms, should the court make an order which achieves the justice thetestator failed to achieve. ... V. Analysis and conclusion [16] I agree that Mrs.

Craigmile owed both legal and moral obligations to her son. Mr. Craigmile is over 18 and is a familymember within the definition in the WSA. Further, I am satisfied that he is unable to earn a livelihood by reason of disability. The factthat he is represented by the Public Guardian and Public Trustee is itself some evidence of disability. Accordingly, I am satisfied that hehas met the statutory preconditions in the WSA for additional maintenance and support and that the facts of this case (trust funds indecline, monthly expenses and other costs on the rise) meet the requirements set out in the case law.

Moreover, as Tataryn suggests, Mrs.Craigmile’s moral obligations also are relevant because society expects her estate to take care of a son who cannot take care of himselfdue to disability. [17] In the result, I granted an Order for the following maintenance and support including these terms: • the personal representative of Mrs. Craigmile’s estate will transfer the House and its contents to be held in a separate trust for Mr.Craigmile called the Kelly Craigmile Life Interest Trust;

• the personal representative will add the remainder of the estate to the Kelly Craigmile Life Interest Trust for the maintenance and support of Mr. Craigmile during his lifetime; • The interest generated by the Kelly Craigmile Life Interest Trust will be paid monthly to the Public Trustee and be dealt with separate from other asserts held in trust on behalf of Mr. Craigmile; • The Public Trustee has the right to encroach on the capital of the Kelly Craigmile Life Interest Trust for maintenance of the House and contents and as required for maintenance and support of Mr.

Craigmile in the sole discretion of the Public Trustee; • In the event that Mr. Craigmile ceases to reside in the House before he dies, the House will be sold and the net proceeds added to and dealt with as part of the Kelly Craigmile Life Interest Trust. At that time, the Public Trustee shall make application to the Court for a review of the Kelly Craigmile Life Interest Trust; and • On the death of Mr. Craigmile, the Public Trustee shall sell all assets remaining in the Kelly Craigmile Life Interest Trust and distribute the net proceeds as follows: 1.

If the House and contents have not previously been dealt with pursuant to paragraph 11 of the Order granted February 9, 2016, the House and contents shall be sold and the proceeds shall be added to and dealt with as part of the Kelly Craigmile Life Interest Trust; 2. An amount equal to the net proceeds from the sale of the House and contents shall be paid to the Schizophrenia Society of Alberta or its successor or assign; 3. The sum of $119,000.00 shall be paid to the Heart and Stroke Foundation of Canada or its successor or assign; and 4.

The balance then remaining shall be paid to Calgary Health Trust or its successor or assign. [ 18 ] In the event that there are not sufficient funds remaining in the Kelly Craigmile Life Interest at the time of Mr. Craigmile’s death to allow the latter distributions, the Public Trustee may seek further direction from the Court. [ 19 ] I find that setting aside further funds as a separate trust as described above is as consistent as possible both with Mrs. Craigmile’s testamentary intent and with respect for the beneficiaries.

I note that, to the credit of the Respondents, there appeared to be no real objection to this Order. Heard and Order granted on the 9 th day of February, 2016. Dated at Calgary, Alberta this 2 nd day of March, 2016. W. Tilleman J.C.Q.B.A. Appearances: Janice M. Elmquist for the Applicant Kelly Craigmile Not in attendance:

John C. Knibbe John C. Knibbe Professional Corporation for the Respondent, Sherry McCorriston Christopher A. Rickards Johnson Ming Manning LLP for the Respondent, Schizophrenia Society of Alberta Bruce Noble for the Respondent, Heart and Stroke Foundation of Canada Shahr Savizi for the Respondent, Calgary Health Trust