Schaeffer Estate (Re), 2016 ABQB 180

Court of Queen ’ s Bench of Alberta Citation: Schaeffer Estate (Re), 2016 ABQB 180 Date: 20160324 Docket: ES10 19498 Registry: Red Deer Between: Loretta Ann Lakeman Applicant - and - Peggy Sue Bayne Respondent _______________________________________________________ Reasons for Judgment of the Honourable Mr. Justice M.

David Gates _______________________________________________________ Introduction and Overview [ 1 ] This is an application by Loretta Ann Lakeman (the “Applicant”), daughter of the late Edith Schaeffer (the “Deceased”), to determine the effect and validity of alleged testamentary instruments in the possession of Peggy Sue Bayne (the “Respondent”), daughter of the Deceased and executor of the estate, and to determine the effect and validity of a transfer of land and GICs by the Deceased into

the joint names of herself and the Respondent. [ 2 ] This matter was heard on January 19-23, 2015. Written argument was received on February 3, 2015. Closing argument was heard on February 21, 2015, at the conclusion of which I reserved my decision. These are my reasons for judgment. Factual Background [ 3 ] Many of the relevant background facts related to this application are not in dispute, as evidenced by the agreement between the parties to enter a Joint Exhibit Book as well as an Agreed Statement of Facts, attached hereto as Appendix A.

Unless otherwise stated, the parties agree that the documents in the joint exhibit book can be admitted into evidence for the truth of their content. [ 4 ] Edith Schaeffer died on February 6, 2012 leaving four adult children, Peggy Bayne, Loretta Lakeman, Michelle Hazen, and Jason Schaeffer. [ 5 ] The Deceased married Morris Schaeffer on November 25, 1961. The family moved to the farm in the spring of 1972, when the Applicant and Respondent were six and nine years of age, respectively. The couple separated in October 15, 1977, at which time the Deceased assumed custody of all of the children.

As part of the 1978 divorce settlement, Morris Schaeffer transferred all of his interest in farmlands near Blackfalds, Alberta, (“the land”), and waived child and/or spousal support (Exhibit #1, Binder 1, Tab 1,2). This same land was transferred into the sole name of the Deceased on December 13, 1982, from Arthur and Alice Mary Ann Pedersen. (Exhibit #1, Binder 1, Tab 5) [ 6 ] The Deceased operated a dairy farm on the land for many years. At its peak, the land supported a herd of 30 dairy cattle. The land was not suitable to support any more cattle.

It was also not suitable for growing crops and most of the feed had to be purchased. Apart from having a large garden, the land was not suitable for anything else. When the dairy herd and milk quota were sold in 1999, the focus shifted to leasing garden plots as a source of income. The Deceased also used a portion of the farm for rental garden plots and also taught community members how to process and preserve produce. The Deceased loved gardening and thought that everyone should have a garden.

At one point, she sought to have her garden plot designated as an organic garden. [ 7 ] The Deceased was a hard and persistent worker. It is very clear from all of the evidence before me that the Deceased had a very strong attachment to the land, and a passionate desire to preserve it in its natural state even after she was gone. However, she was not, as her daughter Michelle testified, “a warm, cuddly person”. At least some of her children found her unpredictable. One day she would speak to a family member and the next she would not.

After she became ill, she became quite manipulative in order to get others to do things for her. According to the Applicant, the Deceased always came first, and did whatever it took to get her way. In the eulogy that she wrote for the Deceased’s funeral, the Respondent stated: “All of us escaped the good german [sic] work ethic of using your kids for cheap farm labour by leaving home as soon as we could see what the world had to offer.” The Relationship with the Children [ 8 ] During the course of the trial, all four children gave evidence.

I heard extensive testimony from each of the children regarding their childhood and particularly, the significant responsibilities that they carried in terms of assisting with daily farm chores before and after school. These activities consisted of planting, maintaining and harvesting a very large garden, assisting in canning, helping with the feeding and milking of the dairy cattle, cleaning barns, assisting with the bailing, strapping and tarping of hay, and other chores around the house and farm.

All four children gave a detailed account of their respective relationships with the Deceased during childhood and from the time they left home until the Deceased’s death. [ 9 ] The Deceased had very serious health issues over the years. She spent five months in hospital in 1978-79. The Respondent was in school at the time and was not able to look after the children but did assumed significant responsibility for the farming operating, including the milking and feeding of the dairy herd. The Deceased’s mother and sister cared for the children.

A neighbour and the children’s father helped around the farm. [ 10 ] Upon reaching the age of 16 years, the Respondent sent her Mother a letter in hospital attaching a power of attorney for her to sign to permit the Respondent to sign cheques. (Exhibit #1, Binder #3, Tab 80) When the Deceased returned home from the hospital, the Respondent recalled that the Deceased was not able to do very much but sit in the house and tell her how she (the Respondent) was doing things wrong. There was a great deal of conflict regarding changes to the routine instituted during her absence.

The Deceased told the Respondent that the yard was not big enough for both of them. The Respondent left the farm shortly thereafter. She lived at an adjacent farm from 1979 until 1981, and then went to college in Red Deer until 1983. She moved back to the farm for a period of time in 1983. [ 11 ] The Respondent always kept in touch with the Deceased. The Deceased came to depend on the Respondent more and more over the years and the two were in regular contact.

Given their shared love of farming, the two would regularly discuss farm issues. [ 12 ] The Applicant had a particularly difficult relationship with the Deceased. She spent increasing times with her father and with friends away from the farm to avoid conflict. At one point the Deceased handed over the Applicant’s birth certificate to a social worker and said that she never wanted to see the Applicant again. Between June 1979 and June 1981, the Applicant spent time in numerous foster homes; in the care of her father, Morris; and short spells back in the care of the Deceased.

When the temporary wardship order expired in July 1981, the Applicant returned to the farm. Until 1983, the Applicant spent periods of time at the farm, but came and went every few months. In 1983, the Applicant left a job in Red Deer to return to look after the farm, as well as her younger sister and brother while her mother was ill and in hospital for six to eight weeks. When her mother was released from hospital and able to do chores, the Applicant left again. She returned for approximately five months in early 1985, but never lived on the farm again.

She married in June 1986. [ 13 ] Both the Applicant and her husband visited the farm frequently over the years and regularly assisted the Deceased with chores

and farm maintenance. In 1992, the Applicant and her husband looked after the farm, including the daily feeding and milking of the cattle, while the Deceased was hospitalized on a couple of occasions. At one point, the Applicant’s brother Jason came to live with them. The Applicant and her family moved to Strathmore in 2002, a two hour drive from the farm. [ 14 ] The Applicant’s husband, David Lakeman, also gave evidence. He confirmed that starting in about 1986, he spent a substantial amount of time at the farm undertaking various chores around the property.

Typically, when arrived at the farm, the Deceased would have a lengthy list of tasks for him to complete. He described the relationship with the Deceased as generally good, but she was unpredictable and there were times when she told them that she did not want to see them. He says that they stopped visiting as frequently starting in 2004 or 2005, after they had moved to Strathmore, as it became increasingly difficult to “ride the waves” of her shifting attitude towards them. [ 15 ] The Applicant’s son Matthew maintained and lived at the farm for several months while the Deceased was in hospital in early 2008.

When the Deceased returned, she asked him to leave. That fall, discussions took place with the Deceased about the Applicant and her husband moving to the farm to provide home care and to maintain the farm. The arrangement was never finalized as the Deceased attached conditions which the Applicant and her husband were not prepared to accept, and also refused to provide them with a long-term lease on the land where they had planned to construct a modular home. [ 16 ] Michelle Hazen remained at home on the farm until she completed the Dairy Herdsman Assistant program at Olds College in 1987.

She lived with her father for a few months when she was 12 or 13. She was unhappy with her Mother at the time and felt she was being too tough on her. Arrangements were made with the court to allow her to live with her father. At the end of the four months, she went back to the farm. With both the Applicant and Respondent away from the farm, much of the work fell to her. Jason was not interested in the dairy operation or the cows.

Generally, she enjoyed the farm work, particularly watching the baby animals grow up. [ 17 ] Michelle returned to work at the farm full-time around 1997 as the Deceased was having health issues at the time and could not afford to pay for farm help. The Deceased approached her to come and help and she agreed. The arrangement lasted about six months and ended because Michelle could not support herself and two children on what her Mother could afford to pay. Her Mother was upset when told that she could not work there anymore.

The health of the cows declined after that as she was unable to milk them every day. [ 18 ] After the Deceased’s death, effective July 2012, the Respondent agreed to rent the farmhouse to Michelle for $1,000 per month, including utilities on a month to month basis. Michelle is responsible for the up-keep of the yard. The Respondent has made no commitment as to how long she can stay in the house. [ 19 ] Jason Schaeffer is the youngest child of the Deceased. For the past five years, he has worked overseas, most recently in Saudi Arabia. He lives in Panama, but visits Canada once a year.

He has a container of his belongings at the farm. [ 20 ] He testified that as soon as he could pick up a pail, at around aged three or four, he began doing chores at the farm. The chores increased as he got older and as his sisters began to leave the farm. The Respondent left in 1979 when he was eight years of age. The Applicant left shortly thereafter, but was back and forth for a number of years. When the Deceased began to get sick, the Applicant came home to look after Michelle and Jason. The Respondent also came back for several months during the Deceased’s initial illnesses.

Other family members and neighbours also assisted over the years when the Deceased was away from the farm due to hospitalization. [ 21 ] Jason left the farm after he finished high school. The situation with the Deceased had become intolerable and he went to live with his sister, the Applicant, under a Kinship Agreement with Children’s Services. [ 22 ] Starting in 1997, Jason worked at several different locations in Africa and the Middle East. He was working in Saudi Arabia at the time of his mother’s death.

He also lived in the Edmonton area and in Calgary at various points in time [ 23 ] Jason maintained a good relationship with the Deceased after he left the farm and returned to assist on a regular basis. He also spent time at the farm between overseas contracts, always assisting with chores. He took the Deceased on an extended holiday to South America in 1998, and later paid half of the cost of a new car for her. [ 24 ] In February 1991, the Deceased set up an RRSP in Jason’s name at Alberta Treasury Branch with an initial deposit of $1,500.

Jason first learned of the existence of the RRSP in his name following his Mother’s death. The Respondent advised him to contact the bank. He received the value of the RRSP, $25,019.74, in March 2012 (Exhibit #1, Binder 2, Tab 51, 53). He does not believe that this represents adequate compensation for his work on the farm over the years. [ 25 ] In 2002, the Deceased asked Jason if he had any interest in operating the farm. While he told the Deceased that he had no interest in being a farmer, he also told her that he would want his fair share if the farm was ever sold.

According to Jason, the Deceased agreed. (Exhibit #1, Binder #2, Tab 50) He testified that he does not recall when he first learned that his mother had transferred the farm into the joint names of herself and the Respondent. The Deceased never told him about the 2002 land transfer. He believes that she may have once spoken to him about him being an executor, but she never discussed her testamentary intentions with him.

The Respondent testified that she told Jason in 2007 that she was joint owner of the land with the Deceased in response to his question regarding what would happen to the land once their Mother died. Jason has no recollection of any such discussion. [ 26 ] Starting around 1986, the Deceased began to have kidney problems that ultimately led to a kidney transplant in September 1991. She started scaling back dairy farm in 1996-97 and sold part of the milk quota. Around the same time, she acquired a bull from the Respondent and starting raising cattle. She was very sick in 1999 and could not get out to milk the cows.

She lost a lot of cows that year. The Respondent assisted her in the sale of the herd and, ultimately, the milk quota. (Exhibit #1, Binder 1, Tab #15) The farm ran at a small deficit every year after 1996, save for 2000, 2004, and 2005 [ 27 ] After terminating the dairy operation, the Deceased maintained over twenty beef cattle. As of 2007, she no longer kept the cattle on the farm during the winter. The Deceased relied on the Respondent to assist her with managing the remaining cattle herd. According to the Respondent, this “did not make my life easy”. The Deceased had seven cattle on the farm until she died.

[ 28 ] The Deceased began collecting the old age pension, as well as a disability pension, in 2000. [ 29 ] In 2007, one of the Deceased’s legs was amputated. The Applicant took time off work and went to stay with Jason in Edmonton so that she could be close to her Mother. In 2009, the Deceased’s other leg was amputated. Transfer of the Land [ 30 ] On March 21, 2002, the Deceased transferred the land to herself and the Respondent as joint tenants. The Offer to Purchase was signed by the Respondent on February 8, 2002, and stated that the consideration was $1 (Exhibit #1, Binder 1, Tab 7,8).

The Respondent paid the Deceased by way of a cheque dated March 27, 2002 in the sum of $1 (Exhibit #1, Binder 1, Tab 43E). The land transfer was dated March 15, 2002 and was witnessed by the Deceased’s lawyer, Alan Sully. Following the death of the Deceased, the land was transferred to the Respondent on February 28, 2012.

Neither the Deceased nor the Respondent reported a disposition or acquisition of land or residence in their 2003 income tax returns, or their GST reporting for that or any subsequent year. (Exhibit #1, Binder #2 , Tab #56, #57, #58, #59) [ 31 ] Casey Kooyman was the Deceased’s accountant and filed her income tax returns for many years. He met with the Deceased and the Respondent on October 24, 2001 to discuss possible methods of transferring the farmland to the children and the related tax consequences. Mr.

Kooyman took rough notes indicating that he had discussed tax rollovers and utilizations on transfers. [ 32 ] Mr. Kooyman candidly acknowledged that he had limited recollection of the discussion. As such, he relied on his very brief notes to attempt to reconstruct what he probably advised the Deceased based on his general practice in providing advice in these types of circumstances.

He also acknowledged that it is likely that his discussion was more information-gathering and that there was likely a follow-up discussion, but he has no recollection of any such further discussion and his time and billing records from that period are no longer available. [ 33 ] Mr. Kooyman testified that the Deceased’s farm income was low and that she had some savings and was receiving social benefits as a result of health issues.

As such, he reasoned that the transfer was a rollover as the Deceased would have lost her social benefits if the transfer triggered a capital gain on the property. [ 34 ] In cross-examination, Mr. Kooyman stated that he was unable to conclude from a review of his notes made at the time of the meeting that the Deceased intended to transfer a beneficial interest in the land to the Respondent. He confirmed that if the Deceased intended to pass the beneficial interest in the land only upon her death, there would be no requirement to report the transfer on her income tax return.

He also testified that there is no requirement to report such a transfer for income tax purposes if the transfer was intended to immediately transfer the beneficial interest in the land, although “it is good practice to do that” (Transcript, p, 24, l. 24). [ 35 ] In response to written questions on affidavit submitted by the Applicant’s counsel, Mr. Kooyman, stated that he could not recall whether the Deceased intended “to transfer all the land . . . into a Joint tenancy with Peggy Bayne” (Exhibit #1, binder #3, Tab 66, 67). He went on to state, “we would have reported the disposition on

schedule 3 of Edith’s 2002 return if there was a disposition of a beneficial interest in the property.” [ 36 ] Mr. Sully, a lawyer with over 40 years in practice who had given the Deceased legal advice in the past, met with the Deceased in January 2002. He candidly acknowledged that his “recollection is very poor” regarding the meeting, though did prepare some contemporaneous notes. He did recall that the Deceased sought his assistance in preparing a will, but that the requirements she wanted included in the will were, in his view, not reasonable and possibly not enforceable.

He refused to take instructions from her to prepare a will in the manner that she requested. He also recalled that the Deceased wished to name the Respondent as executor and her son Jason as the alternate executor. [ 37 ] In response to his refusal to prepare a will in the requested fashion, the Deceased told Mr. Sully that she would look after it herself but she wanted something done with the land in the meantime. She made mention of wanting to transfer the land into the names of the Respondent, Michelle, Jason and herself.

The Deceased wished to impose certain conditions on the transfer, the specifics of which Mr. Sully did not recall. He refused to transfer the land based on the requested conditions. The Deceased then instructed him to transfer the property into the joint names of herself and the Respondent. [ 38 ] The Respondent attended the meeting with Kooyman. The Deceased asked her to attend as they needed to talk about capital gains and how it potentially affected the property. The Respondent was concerned that she might have to sell the property to pay capital gains.

The Respondent was not present in the room when the Deceased spoke to him about a will and the disposition of her estate. During the meeting, she heard Mr. Sully tell the Deceased that she could not control people from beyond the grave. [ 39 ] On January 23, 2002, Mr. Sully wrote to Mr. Kooyman advising that the Deceased had requested a transfer of the land to her daughter and herself jointly without consideration. He went on to seek confirmation from Mr. Kooyman that the transfer would not create unanticipated tax implications (Exhibit #1, Binder #3, Tab #65d). [ 40 ] In his response dated January 28, 2002, Mr.

Kooyman advised that the transfer “will be a rollover under Section 73(3) of the ITA ...and will not incur any tax.” He went on to state that to qualify for a rollover, the recipient must be a resident of Canada and have paid no consideration relative to the transfer. Finally, he indicated that the recipient “must self-assess GST on the return applicable to the date the transfer is made.” [ 41 ] Mr. Sully prepared a purchase agreement and a land transfer. The purchase agreement showed that no consideration flowed from the Respondent to the Deceased, but that the Respondent would be required to self-assess on GST.

Mr. Sully could not recall if he understood the transfer to be a transfer of a legal interest or a beneficial interest in the land. He did not discuss the conditions the Deceased wished to include in a will or in the land transfer to her children by way of a trust agreement.

[ 42 ] The Deceased also asked Mr. Sully to prepare a personal directive. The Deceased signed this document on February 8, 2002 (Exhibit #1, Binder #3, Tab 71b). In the Personal Directive, the Deceased appointed the Respondent as her agent. The Respondent’s authority relative to instructions to heath care providers was subject to explicit guidelines. The Deceased specifically directed the Respondent to contact Michelle and Jason prior to making any decision that might result in her death, and to abide by any majority decision. [ 43 ] Mr.

Sully testified that the Respondent asked about the need to amend her cohabitation agreement with her common law spouse to include a provision that he had no claim on the land that she would be receiving from the Deceased (Exhibit #1, Binder #3, Tab 74). Another lawyer in Mr. Sully’s office prepared this amendment. On April 29, 2002, they signed an amendment to their 1997 cohabitation agreement confirming her common law spouse at the time would have no claim to the land.

The Respondent believes that the Deceased made this request prior to meeting with the lawyer. [ 44 ] In 2010, the Deceased contacted the Alberta Conservation Association (“ACA”) seeking a Conservation Easement to protect the wildlife habitat and agricultural lands. At the time, the ACA was not entering into new conservation easements. In 2013, the Respondent re-newed the request an official from the ACA visited the property and determined that it was land deserving of conservation efforts.

A series of possible agreement options were presented to the Respondent at that time, subject to ACA approval and the removal of any restrictions filed against the land. (Exhibit #1, Binder #3, Tab 88) The Respondent testified that this would conform with Deceased’s wishes – 12 acre plot containing the house and garden plots would still be available to be enjoyed by all four children and remain in Respondent’s name.

The GICs [ 45 ] On February 28, 2008, the Deceased purchased two guaranteed investment certificates (GICs) in the joint names of “Edith Schaeffer or Peggy Bayne” in the amount of $18,308.24 and $17,367.39. The GICs included a right of survivorship. The funds originated from the Deceased’s bank account as of September 16, 1999.

On the date of maturity, March 1, 2010, they were extended for a further two years to March 1, 2012. (Exhibit #1, Binder #1, Tab 25) Following the Deceased’s death, the bank issued the proceeds of the GICs to the Respondent, who had no prior knowledge that the Deceased had purchased the GICs in their joint names. The Testamentary Instruments [ 46 ] During the last year and a half of her life, the Deceased initially had live-in caregivers , followed by 24 hour palliative care. In the last six months, she was hospitalized half of the time.

She had a very serious health issue related to a bleeding ulcer in August 2011. The 2011 will came very shortly after this narrow escape. She also purchased a funeral plan. In October 2011, the Deceased told the Respondent where to find all of the relevant documents upon her death. [ 47 ] The Deceased left no formal will prepared or witnessed by a lawyer. Instead, she prepared a handwritten document purporting to be a holograph will dated January 28, 1998.

In this document, she left 70% of the farm to the Respondent, of which 30% was to go to Jason upon his return to Canada, and the remaining 30% was to go to her Michelle. (Exhibit #1, Binder #1, Tab 43D). The document also addresses the distribution of personal effects, including the dairy herd and milk quota, and the contents of the house. [ 48 ] The original of the January 28, 1998 document was stolen from the Deceased’s purse while she was in hospital in the fall of 2008. The Applicant was aware that the Deceased’s 1998 will was stolen.

A photocopy of the January 28, 1998 document was later discovered in the possession of Mr. Sully. Shortly thereafter, the Applicant told the Deceased about the importance of a will and for her to re-write her will so as to avoid problems in the future. The Deceased’s neighbour Carol Kearns told the Deceased in the summer of 2011 that she should make sure that her wishes regarding the farm should be set out clearly in her will. [ 49 ] On the date of their mother’s death, February 6, 2012, the Applicant and Respondent reviewed the contents of a blue spiralled-coil notebook found in the possessions of the Deceased.

The notebook contains what the parties identified as two documents in the Deceased’s handwriting. The two documents are on three consecutive pages in the notebook and are dated December 2, 2009, and August 13, 2011, respectively. (Exhibit #7) [ 50 ] The first document, dated December 2, 2009, is written in pencil and is unsigned. It is set forth on the first two pages. The second document is dated August 13, 2011. Part of this document is written in pen and

part in pencil. The Deceased signed the document at the end. [ 51 ] The two documents read as follows: December 2/09 – This is the final dispersement of my worldly assets. I choose to do this without consulting or being advised by anyone. I have appointed Peggy Sue (daughter) as executor of my affairs. She has been the constant conection and has the expertise and is able to manage without discrimination. I also appoint son Jason for support and advice. The land owns you you don’t own the land.

To my children I leave land NW 1/42 40-27 – W4 to grow your food, a quiet place to walk and enew your spirits a place where life is save, a place to call home. My wishes are to not develope [sic] the land, and destroy its natural beauty and to always maintain a safe home for wildlife, a place where my gardeners can continue to grow their food and you, all of you can grow your food. Rent the pastures for grazing, preserve the forests and rent the garden for income – open an account. Asset dispersal –

Land – stays intact – family (blood) has first option to rent at a fair price. Letter to executor why you should rent. Account to operate business set up to cover taxes, insurance maitaine [sic] repairs, new buildings Shared income at year 2. Example income – minus 2019 expenses is dispersed Dec 31 2020. Blood line related only. Share Garden to remain as a rental area and or a community garden if a reliable coordinator is available. Family gardens encouraged. August 13, 2011 House hold – 4 children – Pick # for 1 item grandchildren Pick # for 1 item. Desk to Bonnie Dyck.

I fridge 1 stove 1 dishwasher 1 washer 1 dryer remain in the house to rent. Freezers + food Michelle Co-op shares Agrifood Shares RRSP Bank account [account number redacted by Court] + investment First: pay all debts.

Education of grandchildren: They pay all first year expenses and good to excellent grades All of tuition for 3 years with honours ½ of tuition for 3 years with good grades To take place within 5 years of my death 5 years after life the remianing assets are to be divided equally between my 4 children, Peggy sue, Loretta Ann, Michelle Cheri and Jason Avron This is the money from my life’s work in witch [sic] you were all part of in different degrees. The land is in Peggy’s name Acc # [account number redacted by Court] stays with the farm for maintenance, rental plots and house rent goes in this acc.

Evidence of June Baker and Carol Kearns [ 52 ] June Baker was a long-time friend of the Deceased. She discussed the Deceased’s wishes and plans for the farm. She recalled in a sworn statement that while the Deceased’s health was fragile, and was always at risk for life threatening reoccurrences, she worked as long as she could to manage the farm and maintain the cattle.

She indicated the Deceased’s relationship with the Respondent was on a business level and “that she solely entrusted Peggy to conduct her business affairs.” When the Deceased’s health deteriorated she stated “when it came time to let my dairy herd go, Peggy helped me find a suitable buyer for them.” After she lost her leg in 2007, the Deceased became even more interested in using her land to help others. She had garden plots tilled on her property and posted an invitation at the food bank for people to come and learn how to grow vegetables and process them for healthy organic produce. [ 53 ] According to Ms.

Baker, the Deceased was very dedicated and disciplined in terms of the farm. She expected the children to help with the chores and to be partners in keep the farm running. Over the years, Ms. Baker never saw any physical discipline of the children, but acknowledged that the Deceased would get very angry and upset with them. [ 54 ] The Deceased had a difficult time with people from Lacombe County who wanted her to sell the property for development. According to Ms. Baker, the Deceased was adamant that this would not happen.

She wanted the land left in its natural state for the benefit of not only her family, but also for other people. According to Ms. Baker, the Deceased believed that the Respondent really understood that she wanted the land to continue in its natural state. [ 55 ] Ms. Baker was not aware that the Deceased had transferred the land into the joint names of the Deceased and the Respondent until after the Deceased’s death. The Deceased never discussed this with Ms. Baker. While Ms.

Baker was aware that the Deceased’s will was stolen while she was in hospital, she had no specific knowledge as to the Deceased’s intentions as regards a will beyond the fact that they both agreed that they each needed to have a will. [ 56 ] Carol Kearns gave evidence with respect to the Deceased’s wishes for the land. Ms. Kearns kept horses on the Deceased’s property and was in regular contact with her during the last five to six years of her life. [ 57 ] Ms. Kearns met the Deceased in 2006, when she sought permission to ride her horses on the land. The Deceased initially refused.

The following year, the Deceased allowed Ms. Kearns to ride on the land as Ms. Kearns’ agreed to spread manure on the Deceased’s garden. [ 58 ] Sometime in 2008, the Deceased told Ms. Kearns that the Respondent “has it, she’ll take care of it” when asked what was going to happen to the land now that the Deceased was having increasing difficulty in maintaining the land. Later, in 2010, Ms. Kearns’

had another conversation with the Deceased regarding the future of the land. She testified, “I really don’t know what Peggy would do, but I know that she will – she will look after it, she’ll keep it the way I want it, because she loves the land too” (Transcript, p. 9, l. 16- 23). [ 59 ] Ms. Kearns recalled a particular conversation with the Deceased in the summer of 2011. According to Ms. Kearns, she shared concerns that she did not want the Applicant to have anything to do with the land because she would just sell it. Jason similarly would not care for the land and lived overseas.

Michelle had a busy life and might find it difficult to manage. The Deceased indicated the only person that cared about the farm was the Respondent. According to Ms. Kearns, “It was on this day that she disclosed to me those same thought[s] along with the fact that she had willed the property to Peggy for safekeeping it the way it is. I remember saying to her at that time that she better make sure that was laid out clearly in her will . . .” Ms.

Kearns testified that it was the Deceased’s wish to keep the land as a sanctuary to keep it from being invaded by outsiders, such as the County (Exhibit #1, Binder #3,Tab 75 1A). [ 60 ] During the 2011 conversation, the Deceased told Ms. Kearns that she had willed the land to the Respondent because of the fact that she would never change the land and would always be kept the way it is, as a wildlife conservation and also to have it for people to use it for their cattle (Transcript, p. 10, l. 14-19).

During the same conversation, the Deceased mentioned that she was going to get in touch with a conservation officer again. [ 61 ] Ms. Kearns related that at one point the County wanted to put a walking path on the back road to Blackfalds, but the Deceased did not want walkers that close to her land. According to Ms. Kearns, the Deceased did not like anyone trespassing on her land.

Background to the Litigation [ 62 ] Following the Deceased’s funeral, the four children, together with other family members, went back to the farm and distributed the Deceased’s personal possessions by way of a draw, as set out in the Deceased’s January 1998 holograph will and the August 13, 2011 hand-written document. [ 63 ] Neither the Applicant nor Michelle were aware that the farm was in the joint names of the Deceased and the Respondent. Even if Jason had been told about the transfer in 2007, it seems clear that he had forgotten.

Other than the Respondent, none of the other children were aware of the content of the January 28, 1998 will until seeing the Respondent’s affidavit filed in relation to the Application for Advice and Direction. The Applicant and Jason were concerned to learn that the land would be in the Respondent’s name only. [ 64 ] The Respondent gave her niece her number in the draw to pick things from her Mother’s home.

According to the Respondent, she did not want anything from the house. [ 65 ] On the day of the funeral, the Applicant approached the Respondent and told her that she needed to put all four names on the title to the land. On the same day, Jason asked her when the land would be sold. As executor, she was involved in disposing of the property that no one else wanted and had to pay the staff who had cared for her mother. She “warned” her siblings that she stated calving on March 1st, but agreed to resume her work in terms of settling the estate as of June 1st.

At no time did she seek the input or assistance of any of her siblings in settling the estate. [ 66 ] The Respondent declined a family meeting to discuss the matter, claiming there was nothing to discuss and there was “just dissatisfaction right now”.

When questioned as to source and meaning of her statement regarding the consequences to anyone challenging the estate, the Respondent replied that the source was written “on my forehead.” [ 67 ] After a few further conversations and exchanges, the Applicant retained counsel and filed an application in the Court of Queen’s Bench on April 18, 2012 seeking advice and directions. (Exhibit #1, Binder #1, Tab 36) Sisson J set the matter down for trial to address the issues as set out below.

A Certificate of Lis Pendens was filed against the property on April 26, 2012. [ 68 ] The Applicant, with the consent of the Respondent, has made all of the annual maintenance fees on the Fairmont time-share bequeathed to her in the January 1998, document.

At one point, the Respondent asked the Applicant to transfer the time-share into the Applicant’s name, but she declined. [ 69 ] In 2014, the Respondent received correspondence from the County of Lacombe as an adjacent landowner to the Kuhnen farm advising of an application to subdivide the land into a residential parcel (4 acres) and a parcel of 146 acres to be transferred to the County for recreational purposes.

The Respondent then contacted the County and received a draft donation agreement in late 2014 whereby the County would purchase the land, save for a 12.89 parcel associated with the residence, for the sum of $1 plus an income tax receipt in the amount of $1,019,461. (Ex. #5) [ 70 ] The draft agreement contained a provision whereby the County agreed that the land would generally remain in a natural state and not be resold for commercial or residential development. Nothing has been done to finalize the agreement.

Issues [ 71 ] The issues for trial are as follows: 1) What is the testamentary effect and validity of the testamentary documents dated January 28, 1998; December 2, 2009; and August 13, 2011? 2) What is the legal and beneficial effect of the transfers of NW2? 3) What is the legal and beneficial effect of the transfer of GICs into the joint names of the Deceased and the Respondent?

4) Should the Applicant or the Respondent be the executor of the estate? Analysis 1) What is the Testamentary Effect and Validity of the Testamentary Documentsdated January 28, 1998, December 2, 2009, and August 13, 2011? [72] The Applicant says that the handwritten document dated January 28, 1998, satisfies the requirements of a holograph will inthat it is wholly in the handwriting of the testatrix and was signed by her. Further, it shows a deliberate, fixed and final intention todispose of her property on death.

The Applicant contends that following the theft of the original document, the Deceased believed thatshe was without a will and, on December 2, 2009, set about writing a new testamentary instrument in the blue spiralled-coil notebook.The Deceased was still making changes and additions to this testamentary instrument over a period of more than two years, as evidencedby the date August 13, 2011, located on the top of the third page. [73] The Applicant contends that the contents of the lined spiral notebook constitute a single testamentary document that should beread together as a valid holographic will.

Finally, the Applicant takes the position that the writing in the blue spiralled-coil notebook hadthe effect of revoking the prior will. [74] The Respondent argues that the January 28, 1998 handwritten document constitutes a photocopy of a valid holographic will.During oral argument, the Respondent conceded that if any of the other testamentary documents are accepted as valid, that the 1998handwritten document should be treated as revoked. [75] The Respondent says that the two documents found in the blue spiralled-coil notebook should be read separately.

TheRespondent notes that the Deceased did not sign the December 2009 document, and therefore the document, standing alone, is not avalid holographic will. Further, the 2011 document cannot act as a codicil to republish the 2009 document as there is no reference to the2009 document in the latter.

The August 13, 2011 document, on the other hand, is entirely in the Deceased’s handwriting and is signed.It meets the required formalities for a holograph will. [76] The Applicant and the Respondent agree that once the requirements for formal validity are satisfied, the Court is required tointerpret the document to determine whether it was intended to have testamentary effect.

a) The Law - Testamentary Effect and Validity [77] The contents of the notebook and the photocopy of the January 28, 1998 document may constitute holographic wills. If one ormore of these documents constitute a valid will, then the Court must still determine what assets of the Estate fall to be distributedaccording to the will. [78] The date of the Deceased’s death, February 6, 2012, is significant. The new Wills and Succession Act, SA 2010, c. W-12.2(“WSA”), came into force on February 1,

Section 8 provides that the Wills Act, RSA 2000, c. W-12, continues to apply to willsmade prior to that date, subject to the exceptions set out in the section: Fuchs v. Fuchs, 2013 ABQB 78. The

section also provides that s.26 and ss. 37 to 40 of the new Act apply if the testator died after the coming into force of the new statute.

Section 26 refers to theinterpretation of wills and testamentary dispositions, while sections 37 and 39 refer to the validation of non-compliant wills, alterationsand rectifications. [79] The only two formal requirements for a holographic will under the Wills Act are that the will be in the testator’s handwriting,and that the instrument be signed (ss. 7 and 8). A will may be revoked by the making of another will according to s. 16 of the Wills Act. [80] Even once the formalities for a valid will have been met, the Court must determine whether the instrument expresses atestamentary intent.

These requirements are described in Bennett v.

Toronto General Trusts Corporation, (SCC),[1958] SCR 392, 14 DLR (2d) 1 at para 5: There is no controversy, either in the reasons for judgment in the Courts below, or between the parties, that under the authorities, aholographic paper is not testamentary unless it contains a deliberate or fixed and final expression of intention as to the disposal ofproperty upon death, and that it is incumbent upon the party setting up the paper as testamentary to show, by the contents of the paperitself or by extrinsic evidence, that the paper is of that character and nature. [81] To determine whether any of the documents are testamentary in effect, the will must then be interpreted in accordance with s.26: 26 A will must be interpreted in a manner that gives effect to the intent of the testator, and in determining the testator’s intent the Courtmay admit the following evidence:

a) evidence as to the meaning, in either an ordinary or a specialized sense, of the words or phrases used in the will,

b) evidence as to the meaning of the provisions of the will in the context of the testator’s circumstances at the time of the making ofthe will, and

c) evidence of the testator’s intent with regard to the matters referred to in the will. [82] In Lecky Estate v. Lecky, 2011 ABQB 802, Kent J, citing Decore Estate, 2009 ABQB 440, described how the law onextrinsic evidence, “has now evolved to the point where armchair or context evidence is always admissible, when construing a will, and

that extrinsic evidence of intent which is potentially probative, necessary and may reasonably be true, is also admissible” (para. 85). See Hansen v. Mercredi , 2014 ABCA 216 , at para. 9 .

b) January 28, 1998 Document [ 83 ] The Applicant and Respondent agree that the photocopy of the document dated January 28, 1998, meets the requirements of a valid will. The document is signed by the Deceased and is entirely in her handwriting. Further, the wording of the document is sufficient to demonstrate a deliberate, fixed and final intention. [ 84 ] However, the making of another will revokes the former will ( Wills Act , s. 16(b)).

Even in the absence of an express revocation clause, where a subsequent will disposes of, or shows an intention to dispose of, all of the testator’s property, the Court may infer that the testator has impliedly revoked the whole of the first will ( Bates v. Oryschuk , 2009 ABQB 688 at para 23 ). [ 85 ] Following the theft of the Deceased’s purse in the fall of 2008, she believed she was without a will and was urged by family members and friends to prepare a new will.

The Applicant contends that the subsequent documents, dated December 2, 2009 and August 13, 2011, together constitute a valid holographic will and, as such, operate to revoke the will dated January 28, 1998.

The Respondent, on the other hand, says that the August 13, 2011 document alone is a valid holographic will. [ 86 ] While the testamentary effect and validity of the document dated December 2, 2009 is in dispute, the parties agree that the Deceased created a valid holographic will following the theft of her January 28, 1998 will. [ 87 ] Accordingly, I find that the holographic will dated January 28, 1998 was revoked by the making of a subsequent holographic will disposing of the property in the estate.

c) December 2, 2009 Document [ 88 ] There is disagreement whether the December 2, 2009 constitutes a valid testamentary instrument and whether the purported gift of the parcel of land contained in the document expresses a valid testamentary intent. The parties do, however, agree that the December 2, 2009 document is in the handwriting of the Deceased. However, it lacks a written signature as is required for a holographic will under

section 7 of the Wills Act . [ 89 ] The Applicant contends that the December 2, 2009 document and the August 13, 2011 document should be read together as a single testamentary instrument. As such, the Applicant says that there is no formal requirement that a holograph will be dated or that it be created all at one time or with one writing instrument. The sole requirement, satisfied in this case, is that the will be signed at the bottom ( Wills Act , s. 7).

The Applicant concedes that the December 2, 2009 document is not signed, but nevertheless asks the Court to validate a non-compliant will. [ 90 ] The Applicant concedes that the Court’s ability to validate a will or a non-compliant alteration under sections 37 and 38 of the WSA does not include the power to dispense with the requirements for signature: Woods v. Cannon , 2014 ABQB 614 at para 18 , 20).

Section 39 of the WSA, on the other hand, permits the Court to rectify a will which a testator has failed to execute. 39(1) The Court may, on application, order that a will be rectified by adding or deleting characters, words or provisions specified by the Court if the Court is satisfied, on clear and convincing evidence, that the will does not reflect the testator’s intentions because of (

a) an accidental slip, omission or misdescription, or (

b) a misunderstanding of, or a failure to give effect to, the testator’s instructions by a person who prepared the will. (2) Subsection (1) applies to the omission of the testator’s signature only if the Court is satisfied on clear and convincing evidence that the testator (

a) intended to sign the document but omitted to do so by pure mistake or inadvertence, and (

b) intended to give effect to the writing in the document as the testator’s will.

(3) An application under this

section may not be made more than 6 months after the date the grant of probate or administration is issued, unless the Court orders an extension of that period.

(4) The Court may order an extension of the period on any terms the Court considers just. [ 91 ] Since no one was even aware of the existence of the writings in the blue spiralled-coil notebook until just after the death of the Deceased, there is a lack of clear and convincing evidence to satisfy the Court that the Deceased intended to sign the document but omitted to do so by pure mistake or inadvertence. In the absence of any evidence to this effect, I find that the December 2, 2009, document standing alone does not constitutes a valid holographic will.

d) August 13, 2011 Document [ 92 ] The parties agree the August 13, 2011 document is in the handwriting of the Deceased and is signed and, as such, standing alone meets the formal requirements for a valid holographic will. The Applicant and Respondent disagree, however, whether the December 2, 2009 and the August 13, 2011 are to be read together as a single document. [ 93 ] The foundation of the Respondent’s position is the contention that the documents may only be read together if they satisfy the requirements for incorporation by reference. The Respondent argues that the August 13, 2011 document does not refer explicitly to the

December 2, 2009 document, and therefore the requirements for incorporation are not satisfied: Garnett Estate v. Garnett Estate, 2013BCSC 1731 at para 65. [94] This argument presupposes that the writings are indeed separate documents. The doctrine of incorporation is the basis uponwhich “an unexecuted writing entirely separate and apart from the will may considered be part of a duly executed will” (Feeney’sCanadian Law of Wills (Markham, Ont.: LexisNexis Canada), 4th ed., 2000 (loose-leaf), ch 6 at 6-8). I am of the view that the writings inthe blue coil lined notebook are not “entirely separate and apart”.

Rather they are together in the coil-bound notebook and set forth onconsecutive pages. As such, I am satisfied that they should not be read separately but as a single document (see also, Re Dixon-Marsden, [1985] OJ No. 1766, 21 ETR 216 (Ont. Surr. Ct), Re Coate Estate, [1987] OJ No. 192, 26 ETR 161 (Ont. Surr. Ct.), Facey v.Smith, [1997] OJ No. 1858, 17 ETR (2d) (Ont. Gen. Div.), and Oliver Estate v. Reid, (1994) (NL CA), 124 Nfld. &PEIR 294 (NLCA) in Feeney’s, ch 6 at 6-10).

The requirements for incorporation therefore do not apply. [95] The evidence of the Deceased’s actions prior to her death tend to support this view. The Deceased instructed the Respondentto locate her “will,” in the singular, in the blue coil ring binder. No reference was made to different dates or separate documents. Thepresence of the writings in the blue coil ring binder is itself strong contextual evidence that they should be read together. [96] The writings themselves evidence that they are to be read together as a single document.

The December 2, 2009 writings andthe August 13, 2011 writings are on consecutive pages and read coherently from start to finish as a single document. They can be readconsistently with respect to the disposition of property. The writings are also entirely in the handwriting of the deceased and signed,meeting the formal requirements of a valid holographic will. [97] The extrinsic context to making of the writings in the blue coil ring binder also supports a finding that the December 2, 2009document and the August 13, 2011 document are a single document.

Following the theft of the 1998 holograph will in 2008, thedeceased believed she was without a will. The Applicant, the Respondent, June Baker and Carol Kearns all either urged her to prepare anew will or spoke to her about the importance of having a will.

I accept that she set about preparing a will and these efforts are reflectedin her writings commencing on December 2, 2009, and continuing on August 13, 2011. [98] From the time the Deceased expressed her concerns about the loss of the 1998 holograph will, the evidence suggests that shebegan to write her intentions in the notebook and continued to do so for a period of years nearly until the time of her death. The writingsare in pencil, except for the bottom of the final page of the August 13, 2011 writing, which is written in ink. The pencil writings containseveral erasures and insertions.

The cursive in pencil is consistent between the December 2, 2009 writings and the August 13, 2011. Thewriting in ink is in a very unsteady hand, suggesting the document was not completed until she was ailing in her last days.

The evidenceof the Respondent is that the Deceased, “wrote the last of her will when she was very ill . . . [m]aybe even the Friday before she died.” Itis difficult to separate her efforts in making the writings dated December 2, 2009 from the writings dated August 13, 2011. [99] The affixation of her signature in pen at the foot of the writings meets the requirements for the formalities of a signature undersection 8 of the Wills Act, and expresses the culmination of her efforts over the last years of her life to set out her testamentary intentionsin the notebook. [100] There is no formal requirement that the document be dated in order to constitute a valid holographic will (Feeney’s, at ch 4 p 4-26).

Indeed, I am of the view that the dates tend to obscure rather than clarify the manner in which these writings should be interpreted. [101] I find that the writings dated December 2, 2009 and the August 13, 2011 contained in the blue spiralled-coil notebook should beread together to constitute a single holographic will.

e) Testamentary Intent [102] The parties disagree on the extent to which the gift of the parcel of land contained in the December 2, 2009 document is a validtestamentary instrument. The wording of the document, taken together with extrinsic evidence, must express a deliberate or fixed andfinal expression of intention as at the time of death (Bennett, at para. 5). [103] The Applicant relies on evidence of the words of the document to argue that the wording of the gift, “To my children I leave theland ‘NW1.4 2 40-327 W4’”, expresses a clear testamentary intention towards the four children.

The instructions on the second pagewhich further relate to the use of the land as a business, in which the “blood line related only” are to share in the proceeds, whileprecatory, relate to the use of the land by the siblings and are consistent with such a gift. [104] The Applicant contends that the Deceased, frustrated by her unsuccessful attempt to have her lawyer prepare a formal willbequeathing the property on conditions, entrusted the Respondent through the 2002 joint tenancy arrangement, to carry out her wishesregarding the future use of the land.

As such, those wishes found expression in the 2009 and 2011 documents. [105] The Respondent argues that the wording, particularly the words preceding the reference to the land in the 2009 document, “Theland owns you. You don’t own the lands,” do not express a testamentary intention and are merely precatory.

According to theRespondent, the wording was not intended to make a bequest of ownership to all of the four children and rather represented anexpression of the Deceased’s musings and wistful ideas in her final years and confidence that the Respondent as owner would be able topreserve the land in its natural state. [106] The Respondent argues that the words relating to the named parcel in the December 2, 2009 do not express a testamentaryintention because she intended the Respondent as owner to care for and protect the land.

The others, if they chose to, and withoutresponsibility, could enjoy the land, in the words of the Deceased, as “a quiet place to walk and renew your spirits; a place where thewildlife is safe.” [107] In support of this

interpretation, the Respondent relies on the words in the August 13, 2011 document stating that the land wasin the Respondent’s name and the fact that no obligations for work were specified. The later document also refers only to the “remaining

assets,” suggesting that the land had already passed to the Respondent. [ 108 ] The Respondent also relied on the evidence of Carol Kearns, who rode horses on the land since 2006 and became a close friend of the Deceased. The Respondent contends that the timing of the conversations between the Deceased and Ms. Kearns, between 2008 and 2011, are direct evidence of the Deceased’s intent at the time of making the two documents dated December 2, 2009, and August 13, 2011. In particular, in 2008, the Deceased told her that the Respondent would take care of the land.

She understood this to mean that the Respondent would take care of the land as owner. Under the circumstances, the Respondent says that the meaning attributed by the Applicant is inconsistent with this evidence. [ 109 ] A further conversation took place with Ms. Kearns in 2010, where she reiterated that the Respondent “. . . will look after it, she’ll keep it the way I want it, because she loves the land too.” Ms.

Kearns related a subsequent conversation in 2011 in which the Deceased expressed a concern that the Applicant would end up selling NW2; and that Jason never really cared about the land; that he would never live on the land; and that it did not matter to him. [ 110 ] It does not make sense that she would be referring to the possible actions of the Applicant and Jason in 2011, if she intended at the time she transferred the land into the joint names of herself and the Respondent that the Respondent would obtain full title to the property upon her death.

In my view, this statement is consistent with an intention that the Respondent would hold the land for the benefit of her other siblings and not as the sole owner. [ 111 ] I also take into consideration the fact that the Deceased was involved in communications, and possibly negotiations, with the municipality regarding the possibility that the land could be preserved as a natural habitat. Additional evidence was also produced confirming that the Deceased was serious about preserving the natural habitat on the land. A letter from a Mr.

Fontana was produced to indicate that the Deceased had considered the property for a conservation easement in 2010. [ 112 ] The Respondent argued it was not a reasonable

interpretation that her intention for the conservation of NW2 could be achieved except by the Respondent owning the land [ 113 ] Ms. Kearns also recalled during that same 2011 conversation that the Deceased “had willed the property to Peggy for safekeeping it the way it is.” While I have no reason to doubt Ms.

Kearns’ recollection, it is also plausible that what the Deceased intended by this statement that legal title had been transferred to the Respondent to carry out her wishes with respect to the property. [ 114 ] I am of the view that the assurances given to Carol Kearns that the land is to be preserved and that the Respondent would act as a steward is also consistent with a testamentary gift to the siblings. Her discussions with Ms.

Kearns between 2008 and 2011, rather than suggesting that the transfer of title into joint names fully disposed of the property, indicate that she continued to think about how best to distribute the property.

It does not make sense that she would be referring to the possible actions of the Applicant and Jason in 2011, if she intended at the time she transferred the land into the joint names that the Respondent would obtain full title to the property upon her death. [ 115 ] On reviewing the evidence, it becomes apparent that the assurances given to Carol Kearns that NW2 is to be preserved and that the Respondent would act as a steward is also consistent with a testamentary gift to the siblings. [ 116 ] I am satisfied that the writings contained in the blue spiralled-coil notebook were intended by the Deceased to be testamentary in nature.

Prior to her death, she communicated to the Respondent that the writings contained in the notebook were her “will.” The fact that she purported to deal with the entirety of her estate, in my view, creates a strong inference that she intended this document to be testamentary in nature. [ 117 ] These were not the musings or wistful ideas of a woman in her last days but rather an expression of her firm intentions with respect to her estate that took shape over a number of years. [ 118 ] When the Deceased went to see her counsel, Alan Sully, in 2002, she wanted to make a will leaving the land to three of her children, not including the Applicant, as joint tenants.

Moreover, according to Mr. Sully, the Deceased wanted to impose conditions affecting the manner in which her three children would hold the property following her death. Mr. Sully’s evidence was that he refused to draft a will that included such conditions and, indeed told the Deceased that she was trying to control things from the grave. The Deceased told Mr.

Sully that she would look after things herself and was never subsequently called on him to prepare a will. [ 119 ] The circumstances surrounding the transfer of title into joint names tends to support the inference that the Deceased intended for the blue spiralled-coil notebook to have testamentary effect. The fact that she initially contemplated placing the title to the land in the joint names of the Respondent, Michelle and Jason is consistent with the 1998 holograph will.

It was only later after the theft of the 1998 holographic will that she set about writing the contents of the blue spiralled-coil notebook that her intentions changed with respect to gifting the estate to all four of the children. After Mr.

Sully refused to prepare the will in the manner that she requested, I am satisfied that the transfer title into joint names was done with the intention of having the Respondent to carry out her wishes with respect to the land in a similar manner that she had initially requested of her lawyer. [ 120 ] The Deceased was a fiercely independent individual who possessed a passion for the land bordering on an obsession. I note in this regard that, in essence, she traded the children’s right to receive child support from their father at the time of separation in return for the transfer of his interest in the land.

Her independent mindedness can be seen in the fact that she prepared the 1998 holographic will and the writings in the notebook without the benefit of legal assistance and without either the knowledge or assistance of her children.

This is clear from the statement contained at the outset of the revoked 1998 holographic will and in the December 2, 2009 document that she intended to have her wishes carried out without legal and accounting direction. [ 121 ] In my view, the evidence is more consistent with an intention that the Respondent would hold the land for the benefit of her other siblings rather than as the sole owner .

f) Conclusion

[122] I conclude that, on balance, the December 2, 2009 and August 13, 2011 documents, when read together, meet the requirementsof formal validity and express a deliberate and fixed or final expression of intention with respect to the assets of the estate, including thedisposition of land. 2) Presumption of Resulting Trust/Presumption of Advancement – The Law [123] In Pecore v.

Pecore, 2007 SCC 17, [2007] 1 S.C.R. 795, Rothstein J for the majority of the Supreme Court of Canada describedthe common law approach to ascertaining the intentions of a deceased where there is a gratuitous transfer of a joint interest in property toan adult child.

Pecore confirms that the presumptions of advancement and the presumption of resulting trust “continue to have a role toplay in disputes over gratuitous transfers” (at paras 19-23). [124] The presumption of resulting trust was described as follows in Pecore: 24 The presumption of resulting trust is a rebuttable presumption of law and general rule that applies to gratuitous transfers. When atransfer is challenged, the presumption allocates the legal burden of proof.

Thus, where a transfer is made for no consideration, the onusis placed on the transferee to demonstrate that a gift was intended: see Waters' Law of Trusts, at p. 375, and E. E. Gillese and M.Milczynski, The Law of Trusts (2nd ed. 2005), at p. 110. This is so because equity presumes bargains, not gifts. 25 The presumption of resulting trust therefore alters the general practice that a plaintiff (who would be the party challenging thetransfer in these cases) bears the legal burden in a civil case.

Rather, the onus is on the transferee to rebut the presumption of a resultingtrust. 26 In cases where the transferor is deceased and the dispute is between the transferee and a third party, the presumption of resultingtrust has an additional justification. In such cases, it is the transferee who is better placed to bring evidence about the circumstances ofthe transfer. [125] The presumption of advancement, by contrast, will arise “depending on the nature of the relationship between the transferor andthe transferee” (Pecore, at para 27).

Historically, the presumption of advancement applied in two situations: first, where the transferorwas a husband and the transferee his wife, and second where the transferor is the father and transferee his child (Pecore, at para 28). [126] The decision in Pecore did two things. First, it confirmed that the presumption of advancement applies equally to gifts made byboth fathers and mothers gifts to their children (Pecore, at para 33). Secondly, it found that the presumption no longer applied betweenparents and adult independent children (Pecore, at para 36).

The court may consider the quality of the relationship between the transferorand the transferee to determine whether the presumption of resulting trust has been rebutted (Pecore, at para 37). [127] Where the assets are placed into joint names, the “rights of survivorship, both legal and equitable, vest when the joint account isopened and the gift of those rights is therefore inter vivos in nature” (Pecore, at para 48). The presumption of resulting trust in thosecircumstances means that it will fall to the surviving joint account holder to prove that the transferor intended to gift the right ofsurvivorship.

Otherwise, the assets will be treated as part of the transferor’s estate to be distributed according to the transferor’s will(Pecore, at para 53). [128] Where a gratuitous transfer is being challenged, the trial judge must begin the inquiry by determining the proper presumption toapply and then weigh all the evidence relating to the actual intention of the transferor to determine whether the presumption has beenrebutted (Pecore, at para 55). [129] The traditional rule is that evidence adduced to show the intention of the transferor at the time of the transfer "ought to becontemporaneous, or nearly so," to the transaction.

However, in Pecore, the Court held: 56 Whether evidence subsequent to a transfer is admissible has often been a question of whether it complies with the Viscount Simonds'rule in Shephard v. Cartwright, [1955] A.C. 431 (H.L.), at p. 445, citing Snell's Principles of Equity (24th ed. 1954), at p. 153: The acts and declarations of the parties before or at the time of the purchase, [or of the transfer] or so immediately after it as to constitutea part of the transaction, are admissible in evidence either for or against the party who did the act or made the declaration ....

Butsubsequent declarations are admissible as evidence only against the party who made them .... The reason that subsequent acts and declarations have been viewed with mistrust by courts is because a transferor could have changedhis or her mind subsequent to the transfer and because donors are not allowed to retract gifts. As noted by Huband J.A. in Dreger, (MB CA), [1994] 5 ETR (2d) 250 (Man.

CA), at para. 33: "Self-serving statements after the event are too easily fabricatedin order to bring about a desired result." 57 Some courts, however, have departed from the restrictive — and somewhat abstruse — rule in Shephard v. Cartwright. In Neazor v.Hoyle (1962), (AB CA), 32 D.L.R. (2d) 131 (Alta. S.C., App.

Div.), for example, a brother transferred land to hissister eight years before he died and the trial judge considered the conduct of the parties during the years after the transfer to see whetherthey treated the land as belonging beneficially to the brother or the sister.... [130] Evidence of intention that arises subsequent to a transfer should not automatically be excluded if it does not comply with theShephard v. Cartwright rule. Such evidence must be relevant to the intention of the transferor at the time of the transfer.

The trial judgemust assess the reliability of this evidence and determine what weight it should be given, guarding against evidence that is self-serving orthat tends to reflect a change in intention (Pecore, at para 59).

a) Analysis [131] The Respondent argues that the court need not resort to the presumption of resulting trust to settle the issue of the current

ownership of the land as the work provided by the Respondent throughout her life was adequate consideration for the transfer into jointtitle. [132] The Respondent’s argument is that she took on significant responsibilities relating to the property from the time she was fifteenand taking care of her younger siblings while maintaining the farm with the Deceased. The Deceased continued to rely on theRespondent over the years, including her assistance selling the dairy herd and the milk quota in 1999.

The Respondent argues that thetransfer was not gratuitous. [133] Neither party relies on the “Offer to Purchase or Interim Agreement” prepared by legal counsel in favour of the Respondent asevidence tending to rebut the presumption. The specified consideration for the transfer was, however, nominal, in the amount of $1.00. [134] The Respondent submits that the unpaid work she undertook relative to the farm and her commitment to preserving the propertyshould be given significant weight in determining the Deceased’s intentions respecting the transfer of the property. Her evidence wascorroborated by Ms. Kearns, Ms.

Baker and Michelle. This evidence speaks to whether there was consideration for the transfer and tothe quality of their relationship, which might reasonably be expected to influence her intention at the time of transfer (McDermid v.McDermid, 2011 BCSC 952 at para 51). [135] The three other children also provided very detailed evidence regarding their difficult upbringing and the personal demands ontheir time, even as young children, to assist with the farm chores.

While there is some conflict in the evidence relating to their respectivecontributions to the upkeep of the farming operations, I am satisfied that they all made very significant contributions over the years and,in some instances, under very challenging circumstances that involved both emotional and physical abuse.

It was abundantly clear to meat the conclusion of the evidence that all four children are deeply scarred by their childhood experiences on the farm and theirrelationship with the Deceased. [136] Given the significant contributions of the other siblings, I am not satisfied that the efforts of the Respondent to assist over theyears should be viewed as valuable consideration for her receiving a beneficial interest in the land or to infer that the transfer was basedon a particularly close relationship. The reality is that the Deceased did not have a close or warm and loving relationship with any of herchildren.

While undoubtedly the Deceased trusted the Respondent to provide advice and assistance in the general management of heraffairs, the assistance and support she rendered does not, in my view, establish that the transfer was for consideration. In my view, thetransfer was gratuitous . [137] The Respondent contends that at the time of transfer in 2002 the presumption of advancement still operated in favour of theindependent adult child transferee on a gratuitous transfer of an interest in property from a parent. Relying on Petrowski v.

PetrowskiEstate, 2009 ABQB 196, at para 423, the Respondent says that the advice given by Mr. Sully at the time would be that the presumptionof advancement applied to a transfer of property to an adult independent child. [138] Pecore confirmed that the principal justification for the presumption of advancement, namely the parental obligation to supporttheir children, should not apply to adult independent children.

A number of courts had previously concluded the realities of modernCanadian society meant that it was common for an adult child to hold property in trust for the ageing parent to facilitate the free andefficient management of that parent's affairs (Pecore, at para 34). Contemporary opinion accorded little weight to the presumption ofadvancement in relation to an independent, adult child (Waters' Law of Trusts, 3rd ed., Toronto: Thomson Carswell, 2005 at p. 395 inPecore at para 35, citing Cooper v. Cooper Estate (1999), (SK KB), 181 Sask R. 63 (SKQB), McLear v.

McLear(2000) 33 ETR (2d) 272 (ONSC) and Re Mittelstadt Estate (2002), 2002 ABQB 656 , 46 ETR (2d) 227 (ABQB)). [139] Even those decisions that found that the presumption of advancement applied to adult independent children did so on the basisof parental affection for their children (Pecore at para 37, citing Saylor v. Madsen Estate (2005), (ON CA), 261DLR (4th) 597 (ONCA), aff'd 2007 SCC 18, at para 21, Dagle v. Dagle (1990), (PE SCAD), 38 ETR 164 (PEICA),Christmas Estate v. Tuck (1995), 10 ETR (2d) 47 (Ont. Gen. Div.) and Cho Ki Yau Trust (Trustees of) v. Yau Estate, (1999), 29 ETR(2d) 204 (ONSC)).

Courts may still consider evidence of the quality of the relationship between the transferor and the transferee to rebutthe presumption of resulting trust (Pecore, at para.). [140] For these reasons, I do not consider persuasive the rationale in Petrowski that the presumption of advancement should beapplied on the basis that Pecore affected a "significant change in the law" (at para 421). Accordingly, I find that the presumption ofresulting trust applies.

I would simply add that in Petrowski, Moen J found that even if the presumption of resulting trust applied, theevidence led “inevitably” to the conclusion that a gift was intended. [141] The Respondent argues that at the time of transfer, the 1998 holographic will provides an expression of the Deceased’sintentions with respect to the land. The 1998 document demonstrates, according to the Respondent, that the Deceased did not intend anequal distribution of either the land or the value of the heard or the quota.

The Respondent argues that it is inconsistent to infer based onher earlier will that she intended for the property to be co-owned. The Respondent argues when Mr. Sully was unwilling to draft a willaccording to the Deceased’s wishes, a transfer of a right of survivorship was most consistent with her intentions in the 1998 holographicwill. [142] In October 2001, the Deceased, accompanied by the Respondent visited the Deceased’s accountant, Mr. Kooyman, to discussvarious methods of transferring the farmland. Mr.

Kooyman testified from notes that he discussed the tax implications of the transfer,meaning that he would have discussed the consequences of the different methods of transferring either a bare title or a beneficial interest.There was no further meeting to discuss the transfer or clarify what the Deceased’s intentions were with respect to the property.

Mr.Kooyman frankly acknowledged that he was unable to determine, based on his limited recollection, records and correspondence whetherthe Deceased intended a beneficial or a legal transfer of interest. [143] The Deceased did not report in her 2002 income tax return a disposition of the property following the land transfer.

Likewise,the Respondent did not self-assess GST relative to the transfer in her 2002 income tax return, ostensibly on the advice of her bookkeeper.Both parties accept that the lack of capital gains or rollover in the Deceased’s taxes is not determinative of whether or not she intended totransfer her beneficial interest in the property, since she would have jeopardized her social benefits by doing so.

[144] The expert report of Collin Simmons suggests that the tax treatment of the property in 2002 was consistent only with a transferof bare legal title. On evidence given during cross-examination, he also acknowledged that those factors could also be consistent with atransfer of beneficial interest on death or an oversight of reporting. The evidence of Messrs. Kooyman and Simmons regarding the taxtreatment of the transfer provides limited assistance in the assessment the Deceased’s intentions at the time of transfer . Accordingly, Igive this evidence little weight. [145] The Deceased initially approached Mr.

Sully, her solicitor, to prepare a will that would have placed the title into joint tenancyand divided the property between three of the four children. Mr. Sully refused to execute the will in the manner requested because of thedifficulty in preparing the terms of the will based on the conditions she wished to attach to the transfer of land.

The evidence of Mr.Sully was that the Deceased reacted to his refusal to prepare the will by stating that she would deal with it herself. [146] The Applicant argues the transfer of title into the joint name of the Respondent was an attempt to go around the restrictions inthe making of her will described by her lawyer. The Deceased passed title to the Respondent, whom the Deceased believed would carryout her wishes.

These wishes, according to the Applicant, were to distribute the lands according to initially, the 1998 holograph will, andultimately, the writings in the blue spiralled-coil notebook. [147] The Respondent argues that a transfer of land into the joint names of the Respondent was the only one that the Deceased wasprepared to make without conditions and the only one that Mr. Sully was willing to prepare. According to the Respondent, based on theinstructions provided to him with respect to the will, Mr.

Sully knew the Deceased was not prepared to transfer any interest to theApplicant with or without conditions, and that the Deceased was not prepared to transfer any interest to Michelle or Jason withoutconditions. The Deceased was, however, prepared to unconditionally transfer an interest in the lands to the Respondent. Further, relyingon the January 28, 2002 letter from Mr. Kooyman, Mr. Sully believed that no tax would be payable on the transfer. According to theRespondent, as an “experienced counsel,” Mr.

Sully would have recognized that a transfer of the right of survivorship was the onlyoption so as to give effect to the Deceased’s intention to give unconditional ownership of the land to the Respondent upon theDeceased’s death. [148] Mr. Sully has no recollection if he discussed with the Deceased whether she intended to transfer bare legal title or a beneficialinterest. All he discussed was the difference between a joint tenancy and tenancy in common .

It is entirely plausible such a transfer wasdone with the intent that the Respondent was to carry out the Deceased’s wishes following her death based on her instructions for thepreparation of the will. As previously referenced, the Deceased told Mr. Sully that she would look after things herself when advised thathe was not prepared to draft a will in accordance with her instructions. [149] Given his lack of recollection of the events surrounding the transfer, I am unwilling to draw the inference that Mr.

Sullyunderstood, let alone discussed, that the effect of the transfer was to gift a right of survivorship to the Respondent. I am also not satisfiedthat Mr. Sully ever spoke to the Deceased about the presumption of advancement or the presumption of resulting trust. In my view, Mr.Sully’s evidence is not very helpful in terms of attempting to ascertain the intentions of the Deceased at the time of the land transfer. Iam simply unable to draw the various inferences urged upon me by the Respondent given Mr.

Sully’s incomplete recollection of whattook place. [150] The Deceased was, by all accounts, a very stubborn and independent individual who had strong views and wanted to do thingsher way. This is perhaps best evidenced by the fact that when Mr. Sully was unwilling to prepare a will for her in accordance with herstated wishes, she told him she would look after things herself and never thereafter sought his assistance regarding a will.

The Deceaseddid, ultimately, prepare her own will disposing of the land subject to “conditions” or, at the very least, an expression of her views as tohow the land was to be used by her children. Under all of the circumstances, I am

[…]