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Ademption by Advancement & the Presumption of Double Portions: Campbell v. Evert

Campbell v. Evert, 2018 ONSC 593 (CanLII), http://canlii.ca/t/hq27t

Campbell v. Evert,[1] involves an all too often unfortunate occurrence, litigation as between a brother and sister after the death of their mother. The decision examines the not so common legal issues of ademption, ademption by advancement, and the presumption against double portions.

Facts

Prior to her death at age 93, a mother of two children gifted a family cottage to one son.  The cottage was, at the time, valued at $145,000.00.   She executed a Will, thereafter, wherein she made a bequest to her daughter of $145,000.00 (an amount equivalent to the value of the cottage she gifted to the son).  The balance of the estate was to be divided equally as between her son and daughter.

Some-time after the Will was prepared, the testator then established a family trust.  The trust provided that upon her death, her daughter was to receive $150,000.00.  The balance of the trust was to be divided equally between her son and daughter.

After the mother’s death there was a dispute over whether the daughter’s monetary entitlement under the inter vivos family trust displaced the specific bequest made under the Will.

The daughter sought an order for the distribution of the estate in accordance with the terms of the Will.

The defendant brother argued that his sister was not entitled to receive the specific bequest of $145,000.00 because it was the testator’s intention that she receive the $150,000.00 initial payment under the family trust instead of the $145,000.00 specific bequest in the Will. Relying on extrinsic evidence of the testator’s intention, as well as case law relating to ademption by advancement and the presumption against double portions, the defendant argued that the plaintiff would not be entitled to both payments.

Testator Intention

After reviewing the Ontario Court of Appeal decision in Robinson Estate v. Robinson[2],  the leading decision on the use of extrinsic evidence regarding intention, Justice Lococo concluded that extrinsic evidence could not be taken into consideration since there was no ambiguity or equivocation in the words of the Will or the trust.  Specifically, the Court noted that the parties did not dispute the terms of the Will or the trust.  The real issue involved whether the gift provided in the trust was meant to replace the one stipulated in the Will.

Presumption Against Double Portions / Ademption by Advancement

Justice Lococo also reviewed the principles of ademption and ademption by advancement.

An ademption is a gift stipulated in the Will that is unavailable at the time of the testator’s death.  An ademption by advancement occurs when the testator, after executing a Will, gives the beneficiary all or part of the inheritance.

The defendant argued that the principle of ademption by advancement would be applicable.  Since the plaintiff had received the $150,000.00 under the family trust, she was no longer entitled to the $145,000.00 bequest under the Will.

The defendant relied on the presumption against double portions which may arise in cases where ademption by advancement is applicable.

Essentially the presumption, if applicable, involves the testator’s intention of equal treatment between the children.  The presumption may arise when the testator makes a Will dividing assets between the children and later gives one of the children an inter vivos gift.  The gift, in this situation, would be considered an advance on the child’s inheritance and later deducted from his/her share of the bequeathed assets.

Justice Lococo found in this instance that the presumption would not be appropriate, referencing Plamondon v. Czaban[3], which suggests that a narrow construction be placed on such principles in the Canadian context, concluding that the presumption against double portions “is not strong and is easily rebutted.”

Moreover, Palmondon also suggests that the presumption “only applies to a gift to a child made with a view to establishing him or her in life”[4]. However, this particular trust was created when the plaintiff was already an adult with a successful career of her own.

Justice Lococo further observed that if extrinsic evidence was admitted, the court would have taken a broader view and also considered the likelihood that the cottage gifted to the defendant in 1990 would have appreciated in value and the additional gift to the plaintiff would therefore be to compensate for that gain or for the second property that was gifted to the son after the trust was established.

Also noteworthy, the testator took no steps to amend her Will despite the propositions advanced by the defendant.

Takeaways

The presumption against double portions is narrowly applied in the Canadian context.  When it does apply, the presumption is not a strong one and appears to be easily rebuttable.

[1] Campbell v. Evert, 2018 ONSC 593 (CanLII)

[2] Robinson Estate v. Robinson, 2011 ONCA 493, 106 O.R. (3d) 321; leave to appeal refused [2011] S.C.C.A. No. 536

[3] Plamondon v. Czaban, 2004 ABCA 161, 31 Alta. L.R. (4th) 215 at para 46

[4] Plamondon v. Czaban, 2004 ABCA 161, 31 Alta. L.R. (4th) 215 at para 44

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