BONNIE STANLEY, as Executrix of the Estate of JOAN ANN LEBLANC, Applicant, – v. –, 2023 NBKB 067

Citation: Bonnie Stanley v.

Kevin Fred Lee , ET AL, 2023 NBKB 067 IN THE PROBATE COURT OF NEW BRUNSWICK JUDICIAL DISTRICT OF MONCTON MP-112-2021 BETWEEN: BONNIE STANLEY, as Executrix of the Estate of JOAN ANN LEBLANC, Applicant, – and – KEVIN FRED LEE, KRISTEN LEBLANC, MICHAEL DOWE, BRAEDEN DOWE, MADDEX DOWE, CALIE DOWE, CAMRON THOMPSON, MARLEE HICKS, MILDRED HOLMES, GARY HEWITT, SALLY WALTON, ASHLEY TABER, JESSICA STEPHENS, DONNA MCLEOD, JEREMY MCLEOD, DAMEN MCLEOD, JACOB SEARS, DAMEN SEARS, PEYTON SEARS, and REED ESTABROOKS , Respondents , DECISION BEFORE: Justice Jean-Paul Ouellette AT: Moncton, New Brunswick DATE OF HEARING: February 15, 2023 DATE OF DECISION: April 27, 2023 APPEARANCES: Monica L.

Barley and Gabrielle Rouleau , for the Applicant; Ouellette, J. INTRODUCTION [ 1 ] The Executrix and Trustee, Bonnie Stanley (the “Executrix”), is seeking an opinion, advice, or directions relating to paragraph 17 of the Last Will and Testament of the late Joan Ann LeBlanc (the “Testator”) dated December 14, 2018.

[ 2 ] Paragraph 17 of the Will directs the Executrix to bequest funds “to be made after the sale of the front lot of my Milton Lane property”, property that had been sold prior to the Testator’s death. Furthermore, the remainder of the net proceeds of sale of the said property, which were to be bequeathed to her daughter, could have been intermingled in the Testator’s numerous bank accounts. [ 3 ] For the reasons that follow, the bequests in paragraph 17, which were to be distributed after the sale of that specific property, even if it had been sold before her death, are valid.

As for the direction “to give and transfer the remainder of the net proceeds of sale”, specified later in paragraph 17, that bequest is also valid and shall be applied to all remaining funds traceable to the proceeds of sale of the said property, subject to the other dispositions in the Will. [ 4 ] It was brought to the attention of the Court that, on legal advice from counsel, not counsel of record, the Executrix had distributed some funds as if clause 17 was null and void.

The Court was also advised that Kevin Fred Lee was transferred a lot on Route 940 in Midgic, County of Westmorland, PID 0091298, without building a residence thereon as a pre-condition to this bequest. These issues will have to be dealt with by the Executrix in due course and by the Court, if required, when specifically requested to do so. FACTUAL BACKGROUND [ 5 ] Joan Ann LeBlanc passed away on February 24, 2021, leaving a Last Will and Testament dated December 14, 2018.

Bonnie Stanley, a friend, was named as her Executrix and Trustee. [ 6 ] The Testator was married to Kevin Fred Lee, and they had both executed a domestic contract prior to the Testator’s death. The Testator had two children from a previous relationship; a son, Michael Dowe, and a daughter, Kristen LeBlanc. Michael has five children and Kristen has one daughter. [ 7 ] The Testator lived in her home located at 28 Milton Lane, Sackville, New Brunswick, bearing PID 70648910.

Prior to her death, she sold the lot bearing PID 70648902, being the front lot of the Milton Lane property referred to above in her Will, wherein she operated a nursing home. [ 8 ] On August 30, 2019, this front lot was sold and the net proceeds of the sale, $720,632.25, were deposited in her TD Companion Savings Account bearing account number 48…33 on that same day. [ 9 ] Paragraph 17 of the Testator’s Last Will and Testament provided for the following bequests: I DIRECT my Trustee that all of the following bequests shall be made after the sale of the front lot of my Milton Lane property:

a) To give to each of my grandchildren named herein the sum of Twenty Thousand Dollars ($20,000.00) each: BRAEDEN DOWE of Ontario, MADDEX DOWE of Sackville, New Brunswick; CAMRON THOMPSON of Sackville, New Brunswick; CALIE DOWE of Sackville, New Brunswick; and MARLEE HICKS of Moncton, New Brunswick.

Provided, however, should the youngest of these grandchildren be under Twenty-five (25) years of age at the time of my death, my Trustee is to hold these five bequests in trust and to invest and keep those funds invested until such time as the youngest of these grandchildren reaches Twenty-five (25) years of age at which time all five of these beneficiaries shall meet with my Trustee and each beneficiary shall receive the income and capital of their trust along with any personal possessions which I may have left to them pursuant to paragraph 9 above.

b) To give my husband, KEVIN , the sum of Forty Thousand Dollars ($40,000.00).

c) To give my son, MICHAEL DOWE , the sum of Forty Thousand Dollars ($40,000.00), PROVIDED HOWEVER , should MICHAEL be under the age of Fifty (50) at the time of this distribution, to give him the sum of Twenty-five Thousand Dollars ($25,000.00) and to invest and keep invested the sum of Fifteen Thousand Dollars ($15,000) in trust until he reaches Fifty (50) years of age at which time the income and capital of the trust shall be paid to him. Should MICHAEL die before becoming entitled to receive the entire principal of his trust, to divide the trust as constituted at his death among his children then alive, in equal shares.

d) If any of MICHAEL ’s children become beneficiaries pursuant to paragraph 17(

c) above and any are under Twenty-five (25) years of age at the time of that distribution, I DIRECT my Trustee is to hold these bequests in trust and to invest and keep those funds invested until such time as the youngest of Michael’s children reaches Twenty-five (25) years of age at which time all of these beneficiaries shall meet with my Trustee and each beneficiary shall receive the income and capital of this portion of their trust.

e) If, BONNIE STANLEY , acts as my Executor then to give her Ten Thousand Dollars ($10,000) as her Executor’s fee.

f) I DIRECT my Trustee to give and transfer the remainder of the net proceeds of sale from my front lot Milton Lane property (“net proceeds of sale”) to my daughter KRISTEN . PROVIDED HOWEVER , should KRISTEN be under the age of Fifty (50) at the time of this distribution, to give her Fifty Thousand Dollars ($50,000) of the net proceeds of sale after the above-noted distributions are made (“net proceeds of sale”), and to invest and keep invested any amount remaining of the net proceeds of sale in trust until she reaches Fifty (50) years of age at which time the remainder of this bequest shall be paid to her.

Should KRISTEN die before becoming entitled to receive the entire principal of her trust, to divide the trust as constituted at her death among her children then alive, in equal shares.

g) If any of KRISTEN ’s children become beneficiaries pursuant to paragraph 17(

f) above and any are under Twenty-five (25) years of age at the time of that distribution, I DIRECT my Trustee is to hold these bequests in trust and to invest and keep those funds invested until such time as the youngest of Kristen’s children reaches Twenty-five (25) years of age at which time all of these beneficiaries shall meet with my Trustee and each beneficiary shall receive the income and capital of this portion of their trust.

g) I DIRECT if after the payment of the above bequests, there are sufficient funds in my bank accounts to pay out the following twelve

bequests to the beneficiaries named below. If there are not sufficient funds in my bank account to pay out the following then each is toreceive a pro rata share of any amounts remaining in my bank account, if there are none then the following gifts shall lapse:

i) Two Thousand Dollars ($2,000.00) to my mother, MILDRED HOLMES of Sackville; ii) One Thousand Dollars ($1,000.00) to my brother, GARY HEWITT of Sackville; iii) One Thousand Dollars ($1,000.00) to my sister, SALLY WALTON of Moncton; iv) One Thousand Dollars ($1,000.00) to my niece, ASHLEY TABER of Sackville;

v) One Thousand Dollars ($1,000.00) to my niece, JESSICA STEPHENS of Sackville; vi) One Thousand Dollars ($1,000.00) to my niece, DONNA McLEOD of Moncton; vii) One Thousand Dollars ($1,000.00) to my nephew, JEREMY McLEOD of Moncton; viii) One Thousand Dollars ($1,000.00) to my great-nephew, DAMEN McLEOD of Moncton; ix) One Thousand Dollars ($1,000.00) to my great-nephew, JACOB SEARS of Sackville;

x) One Thousand Dollars ($1,000.00) to my great-nephew, DAMEN SEARS of Sackville; xi) One Thousand Dollars ($1,000.00) to my great-niece, PEYTON SEARS of Sackville; xii) One Thousand Dollard ($1,000.00) to my great-nephew, REED ESTABROOKS of Sackville; [10] At the time of her death, as it will be demonstrated later in this decision, while the Testator did not possess the totality of thenet proceeds of sale of the property, it is possible to account for some amounts that were used by the Testator before her death and, byreviewing numerous bank accounts, to determine the remaining amount to be disposed of as per the intention of the Testator in her LastWill and Testament.

ISSUES [11] The only issue to be determined is to clarify the intent of the Testator at paragraph 17 of her Last Will and Testament whereinshe wrote: “… the following bequests shall be made after the sale of the front lot of my Milton Lane property” and, subsequently, todetermine what was the bequest in clause 17(

f) relating to the “remainder of the net proceeds of the sale…”. ANALYSIS AND CONCLUSION [12] The Probate Court Act sets out in

section 3 the power of the probate court in relation to providing its opinion, advice, ordirection regarding the administration of an Estate.

It reads as follows: Powers vested in Court 3(1) Without derogating from the jurisdiction of the Court of Queen’s Bench and subject to the Judicature Act, all jurisdiction andauthority in relation to matters and causes testamentary and all matters arising out of or connected with the grant, recall or revocation ofgrant of probate or administration are vested in the Court; and save as may be otherwise directed by this Act or the rules, suchjurisdiction and authority shall be exercised in the manner hitherto in use. 3(2) Without in any way derogating from the generality of the foregoing, but subject always thereto, the Court has exclusivejurisdiction and authority in the following items: (

a) over all of the estate of a deceased person, whether or not a resident of the Province at the date of death, which estate is locatedin the Province; and whether it consists of real or personal property or both; (

b) in respect of the grant, recall and revocation of letters probate of a will, letters of administration whether with or without a willannexed, and resealing as described in

section 73; (

c) subject to the concurrent jurisdiction of the Court of Queen’s Bench, in the issuance of any orders or directions in connectionwith the administration, passing of accounts and winding up of the estate of a deceased person as described in paragraph (a). [13] The Supreme Court of Canada in National Trust, SCR 817, at page 829, set out the principal governing the

interpretation ofwills in the following terms: In the construction of wills, the primary purpose is to determine the intention of the testator and it is only when such intention cannot bearrived at with reasonable certainty by giving the natural and ordinary meaning to the words which he has used that resort is to be had tothe rules of construction which have been developed by the Courts in the

interpretation of other wills. It is to be remembered that suchrules of construction are not rules of law and that if their application results in attributing to the testator an intention which appearsinconsistent with the scheme of the will as a whole, then they are not to prevail. [14] In Sargent Estate (Re), (NB KB), 83 NBR (2d) 19, [1987] NBJ No 913 (QB), the Probate Court set outthe duties of the executor as follows: […] rooted in the protection and preservation of assets of the testator and an obligation to the trust beneficiaries. More particularly, they

are to collect the assets of the deceased, to ascertain the debts and liabilities due or owing by the deceased’s estate, to attend to the payment of such debts and liabilities, and to arrange for the legal and proper distribution of the estate among the persons entitled hereto. [ 15 ] The

interpretation of the Testator’s Last Will and Testament is governed by the natural and ordinary meaning of the words used in the Will, i.e., at paragraph 17: “I DIRECT my trustee… after the sale of the front lot of my Milton Lane property …”, and what the consequences of those words are once that property was sold prior to her death and how to distribute her estate accordingly. [ 16 ] The Testator’s intention must be interpreted as part of the entirety of the Will, and, in paragraph 16, she refers to “the front lot” to allow her husband, Kevin Fred Lee, and her daughter, Kristen LeBlanc, the possibility of operating the nursing home thereon which is now a moot issue.

However, paragraph 16 must be read in the context of explaining when and why the front lot was not to be sold before determining what would result from the decision to operate the nursing home or not. As the property had been sold prior to the Testator’s passing, there is nothing to be divided in relation to paragraph 16 but the funds that are to be distributed as per paragraph 17 must be taken from what is left of the sale proceeds. [ 17 ] Reading the whole of paragraph 17

a) to

g) in that context, only paragraph f) and

g) are specific to the remainder of the net proceeds of sale from the front lot Milton Lane property. [ 18 ] There are two subparagraph g)’s in the Will; the first, beginning with the words “[i]f any of Kristen’s children…”, is to be interpreted with subparagraph

f) as it relates to it. [ 19 ] The bequest found in the second subparagraph identified as g), “I DIRECT if after the payment of the above bequests, there are sufficient funds in my bank accounts…”, cannot be made from the remainder of the sale proceeds for the same reason. However, the other bequests found in subparagraphs

a) to

d) of paragraph 17 are to be drawn from the proceeds of sale of the front property. The Testator did not intend to give the full proceeds of the sale to her daughter, Kristen, but intended to give her the remainder of those funds subject to the bequests mentioned therein. [ 20 ] At the time of her death, the Testator had some money in her bank accounts, which will be discussed later, and which cannot be traced back to the proceeds of the sale of the front Milton Lane property. In subparagraph

a) to

e) the Testator bequeaths $190,000 in total, keeping in mind that, in the second clause g) of paragraph 17, $13,000 is bequeathed to twelve beneficiaries if there are sufficient funds remaining in her bank accounts. [ 21 ] For the benefit of this Court, what amount of funds, if any, were traceable to the sale proceeds of the front Milton Lane property for consideration as the remaining funds bequeathed to the Testator’s daughter, Kristen, under subparagraph 17 f)?

TRACEABLITY OF THE PROCEEDS [ 22 ] In her Last Will and Testament, the Testator anticipated how to use the proceeds of sale from the front Milton Lane property. The most important factor for determining whether a gift fails or not is the traceability of the proceeds rather than the categorization of the gift as specified or general (see: Halsbury’s Law of Canada (online), Wills and Estates (2020 Reissue) , “Wills: Failure of Gifts: At Death Property Not Among Testator’s Assets: Ademption” (1.7(2)(c)(ii)) at HWE-159 “Common Law”). [ 23 ] In the Wills Act ,

section 20 provides that where the testator has gifted the proceeds of sale from a property and those proceeds are recovered by the testator before death, the gift does not fail by comingling the proceeds with the funds of the testator if the proceeds can be traced. The relevant

section of the Wills Act reads as follows: 20(3) Except when a contrary intention appears by the will, where the testator has bequeathed proceeds of the sale of property and the proceeds are received by him before his death, the bequest is not adeemed by commingling the proceeds with the funds of the testator if the proceeds are traced into those funds. [ 24 ] As such, in the case at bar, the “remainder of the net proceeds of sale of my front lot Milton Lane property” is more generic or demonstrative in nature than specific since the gift is not of the front lot Milton Lane property but of the remainder of the net proceeds of sale, a pecuniary gift.

The only question therefore becomes: can the remainder of the net proceeds of sale be traced such that they are easily identifiable? [ 25 ] The Court received, for the purpose of this analysis, a copy of four bank account records under the name of the deceased. I will deal with each of them to explain how it was possible to trace or follow the sale proceeds for the purpose of paragraph 17

f) of the Will. [ 26 ] The account where the sale proceeds were initially deposited was a TD Companion Savings Account, account number 48…33 (“Account 33”). On the day of the sale of her property, August 30, 2019, the opening balance in this account was $155,000.78 plus the deposited amount of $720,632.75. On February 24, 2021, the closing amount in this account was $100,319.17. [ 27 ] There was, at TD Bank, a second account, account number 48…89 (“Account 89”) where $297,893.53 was transferred from Account 33 in 19 separate transfers.

In this account, during the relevant period, there were 115 deposits totaling $510,049.60 and 627 withdrawals representing an amount of $470,356.60. This seems to be the account that the deceased used for her day-to-day transactions. The opening balance in this account, Account 89, on August 30, 2019, was $2,003.65 and the closing balance, on February 24, 2021, was $41,696.65. Considering the number of deposits and withdrawals made during the relevant period, there is no way to follow the sale proceeds that came from Account 33 and deposited in Account 89.

This sum, of $41,696.65, therefore forms part of the general funds available in the Estate for bequests, distribution, or other use as the case may be. [ 28 ] There is another TD Bank account, account number 48…86 (“Account 86”) which had an opening amount of $2,561.28 and which received a transfer from Account 33 in the amount of $100,000, deposited on March 20, 2020. This account, on closing, had a balance of $104,007.62. Another $21,112.31 was deposited in Account 86 during the same period and this account never held less than a $100,000 balance.

On June 2, 2020, a withdrawal of $15,000 was made but a deposit of $13,558.66 from Account 89 brought the balance

of Account 86 to an even amount of $100,000. Interest was added to the account monthly and monthly transfers of $500 were deposited thereafter from an unknown source which brought the closing balance to $104,007.62, as mentioned above.

For the purposes of tracing the sale proceeds, it is the conclusion of this Court that the $100,000 in Account 86 did originate from the proceeds of the sale and the remaining balance of $4,007.62 is to be attributed to the general funds of the Estate. [ 29 ] On August 30, 2019, the deceased had a Scotiabank account with an opening balance of $2,561.28 and a closing balance of $356.18. This account, account number 70…52 (“Account 52”), had 15 transfers from Account 89 totalling $16,420 and 18 deposits, which include the 15 transfers, representing $17,060.11 in total.

There were 162 withdrawals totalling $17,530.99. With the numerous deposits and withdrawals being considered, this Court to cannot conclude or trace any amount in this account to the sale proceeds. The funds in this account are to be used for general purposes as provided for under the Will. [ 30 ] Finally, there was a withdrawal of $300,000 from Account 33 which was converted into three $100,000 bank drafts found in the deceased safety deposit box after her death.

This is, in all likelihood, money from the sale proceeds and is traceable. [ 31 ] On August 30, 2019, there was, in Account 33, $155,000.78 and $720,632.95 was deposited in the account, being the sale proceeds.

The closing balance was $100,319.17. [ 32 ] As there were more withdrawals (38 totalling $776,784.06) than deposits (19 representing $1,350.20), with the exception of the transfers to other accounts as mentioned above, the Court cannot determine whether there are any amounts in Account 33 that could be traceable to the sale proceeds. [ 33 ] As for cash, other than the $400,000 amount that is traceable to the proceeds of sale of the front Milton Lane property, the Testator had $146,023.44 in her various bank accounts at the time of her death which cannot be traced to the sale proceeds. [ 34 ] To give effect to the Testator’s intentions, $400,000 from the proceeds of sale from the front property will be used for the bequests set out under paragraph 17

a) to

f) and from the general funds, determined to be the remainder of the funds in her estate, are to be used for the payment of the bequests ($13,000) under the second clause g) of paragraph 17. [ 35 ] The Executrix and Trustee, Bonnie Stanley, shall be guided accordingly. DATED at Moncton, New Brunswick this 27 th day of April 2023. ____________________________________ Jean-Paul Ouellette, Justice of the Court of King's Bench of New Brunswick