Does an Executor Have a Duty to Notify Beneficiaries in an Earlier Will?
Introduction
I should have thought that the answer to the above question is a resounding, ‘No, of course not. An executor has a duty only the beneficiaries of the estate she is charged with administering’. But this issue was raised in Toronto Dominion Bank v Witoszkin,[1] so I think it wise to address it also in this blog.
Facts
The testator, Judith Jenkins (‘Judith’) died unmarried, without children or close family. She made a Will in 2008 (the ‘2008 Will’) in which she named the applicant, the Toronto-Dominion Bank (‘TD’) her executor and left specific items to certain remote family members and divided the residue among named charities and organizations.
Judith made another Will in 2022 (the ‘2022 Will’) and named the respondent, Caroline Witoszkin (‘Caroline’) as her executor. Caroline was employed by TD from 1984 until she retired in 2020. She had been Judith’s father’s portfolio manager and when he died in 2006 Judith became a client of Caroline. Caroline deposed that she and Judith became friends and used to go to meals and theatre productions together. When Judith was diagnosed with cancer in 2015, Caroline took her to all her appointments. Caroline was aware that while she was employed by TD she was bound by its Code of Conduct. The Code prevented employees from acting as executors or trustees, or in any other fiduciary capacity for clients of the bank and were precluded from being a beneficiary under a client’s will or trust. Further, if an employee learnt that a client named her as executor, she would have to inform TD immediately. Hence, when Judith wanted to make Caroline a beneficiary under the 2008 Will, Caroline declined. Judith also made a Will in 2018 and she told Caroline after she retired that she was a beneficiary under that Will. Judith’s solicitor had confirmed that Caroline had not influenced Judith in any way regarding that Will. Caroline did not inform TD since she was then no longer employed by the bank. The solicitor again confirmed at the time of the 2022 Will that Caroline had not influenced Judith regarding that Will and that Judith was adamant about her testamentary wishes. In fact, Judith wrote a very clear and perceptive letter to the lawyer at his request in which she set out her intentions and confirmed her capacity. She also wrote a lucid and delightful letter to her friend, Caroline, shortly before her death. Judith died using MAID a couple of weeks after she made the 2022 Will.
In 2022 TD wrote to Caroline expressing concern about the changes to the 2008 Will and asking her to advise the beneficiaries of that Will of their interest under it and the circumstances relating to the changes made in the 2022 Will. Caroline refused to do so. TD then brought this application in which it sought direction from the court requiring Caroline to provide notice to the beneficiaries under the 2008 Will, so that they could challenge the 2022 Will if they wished.
Analysis and Judgment
TD conceded that there is no general rule requiring that notice be given to beneficiaries under prior testamentary instruments. However, it argued that in the special circumstances of this case, the court should order Caroline to give notice to the beneficiaries under the 2008 Will. TD argued that while Caroline described her close personal relationship to Judith, she provided no corroboration of it. Also, Judith was a vulnerable and isolated person who was ill and had no close family. She used different lawyers for her 2008 and 2022 Wills. Further there was the professional relationship between Caroline and Judith and Caroline’s conflict of interest between her position as executor and sole residuary beneficiary. TD relied on a Kentucky case which imposed a duty on a trustee to inform beneficiaries under a prior instrument. However, Justice Gilmore held that the case was distinguishable because it concerned an inter vivos trust, not a testamentary document.
Her Honour concluded that the similarity between the 2018 and 2022 Wills bolstered Judith’s clear intentions. Further, she found that Caroline’s evidence was corroborated by the solicitor who drafted both 2018 and 2022 Wills, and who took pains to establish that Judith had capacity and was not subjected to undue influence. In addition, there was evidence that Judith and Caroline were friends long before Caroline became Judith’s investment advisor. Thus, she concluded that their friendship went beyond that of an advisor/client relationship.
Her Honour also found that Caroline did not breach TD’s Code of Conduct, since she was no longer employed by TD since 2020. Moreover, the Code made an exception in favour of ‘relatives and people with whom we share … a close personal relationship’. The latter was evident also from the fact that Judith named Caroline as her Attorney for Personal Care in 2008.
Justice Gilmore also referred to a 2021 Ontario case, Lugarich v Fabris.[2] The applicant in that case was the son of the deceased and a beneficiary under a previous Will. However, the last Will left the testator’s entire estate to his late wife’s daughter and named his lawyer as his executor. The son brought proceedings to challenge the Will and argued that the lawyer could not sell estate property because he was a party to the will challenge and therefore in a conflict of interest. But the court dismissed the application. The son was not a beneficiary under the latest Will and, unless he was successful in the will challenge, the lawyer did not owe him any fiduciary duties.
Her Honour also found that the fact that Judith was ill had only minimal or no effect on her vulnerability. Besides, there were two pieces of evidence which clearly indicated that Judith was capable of independent decision making. One was her letter to Caroline shortly before she died, which was lucid and expressive. The other was the written attestation of two doctors in March 2022 which confirmed that Judith was capable of providing informed consent for her assisted dying process.
Consequently, her Honour followed Lugarich, and held that Caroline did not have any fiduciary duty to the beneficiaries of the 2018 Will and therefore was not required to give notice to them of the 2022 Will. She dismissed the application and awarded partial indemnity costs to the Respondent.
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[1] 2024 ONSC 921.
[2] 2021 ONSC 7294.
Written by: Albert Oosterhoff
Posted on: July 25, 2024
Categories: Commentary, WEL Newsletter
Introduction
I should have thought that the answer to the above question is a resounding, ‘No, of course not. An executor has a duty only the beneficiaries of the estate she is charged with administering’. But this issue was raised in Toronto Dominion Bank v Witoszkin,[1] so I think it wise to address it also in this blog.
Facts
The testator, Judith Jenkins (‘Judith’) died unmarried, without children or close family. She made a Will in 2008 (the ‘2008 Will’) in which she named the applicant, the Toronto-Dominion Bank (‘TD’) her executor and left specific items to certain remote family members and divided the residue among named charities and organizations.
Judith made another Will in 2022 (the ‘2022 Will’) and named the respondent, Caroline Witoszkin (‘Caroline’) as her executor. Caroline was employed by TD from 1984 until she retired in 2020. She had been Judith’s father’s portfolio manager and when he died in 2006 Judith became a client of Caroline. Caroline deposed that she and Judith became friends and used to go to meals and theatre productions together. When Judith was diagnosed with cancer in 2015, Caroline took her to all her appointments. Caroline was aware that while she was employed by TD she was bound by its Code of Conduct. The Code prevented employees from acting as executors or trustees, or in any other fiduciary capacity for clients of the bank and were precluded from being a beneficiary under a client’s will or trust. Further, if an employee learnt that a client named her as executor, she would have to inform TD immediately. Hence, when Judith wanted to make Caroline a beneficiary under the 2008 Will, Caroline declined. Judith also made a Will in 2018 and she told Caroline after she retired that she was a beneficiary under that Will. Judith’s solicitor had confirmed that Caroline had not influenced Judith in any way regarding that Will. Caroline did not inform TD since she was then no longer employed by the bank. The solicitor again confirmed at the time of the 2022 Will that Caroline had not influenced Judith regarding that Will and that Judith was adamant about her testamentary wishes. In fact, Judith wrote a very clear and perceptive letter to the lawyer at his request in which she set out her intentions and confirmed her capacity. She also wrote a lucid and delightful letter to her friend, Caroline, shortly before her death. Judith died using MAID a couple of weeks after she made the 2022 Will.
In 2022 TD wrote to Caroline expressing concern about the changes to the 2008 Will and asking her to advise the beneficiaries of that Will of their interest under it and the circumstances relating to the changes made in the 2022 Will. Caroline refused to do so. TD then brought this application in which it sought direction from the court requiring Caroline to provide notice to the beneficiaries under the 2008 Will, so that they could challenge the 2022 Will if they wished.
Analysis and Judgment
TD conceded that there is no general rule requiring that notice be given to beneficiaries under prior testamentary instruments. However, it argued that in the special circumstances of this case, the court should order Caroline to give notice to the beneficiaries under the 2008 Will. TD argued that while Caroline described her close personal relationship to Judith, she provided no corroboration of it. Also, Judith was a vulnerable and isolated person who was ill and had no close family. She used different lawyers for her 2008 and 2022 Wills. Further there was the professional relationship between Caroline and Judith and Caroline’s conflict of interest between her position as executor and sole residuary beneficiary. TD relied on a Kentucky case which imposed a duty on a trustee to inform beneficiaries under a prior instrument. However, Justice Gilmore held that the case was distinguishable because it concerned an inter vivos trust, not a testamentary document.
Her Honour concluded that the similarity between the 2018 and 2022 Wills bolstered Judith’s clear intentions. Further, she found that Caroline’s evidence was corroborated by the solicitor who drafted both 2018 and 2022 Wills, and who took pains to establish that Judith had capacity and was not subjected to undue influence. In addition, there was evidence that Judith and Caroline were friends long before Caroline became Judith’s investment advisor. Thus, she concluded that their friendship went beyond that of an advisor/client relationship.
Her Honour also found that Caroline did not breach TD’s Code of Conduct, since she was no longer employed by TD since 2020. Moreover, the Code made an exception in favour of ‘relatives and people with whom we share … a close personal relationship’. The latter was evident also from the fact that Judith named Caroline as her Attorney for Personal Care in 2008.
Justice Gilmore also referred to a 2021 Ontario case, Lugarich v Fabris.[2] The applicant in that case was the son of the deceased and a beneficiary under a previous Will. However, the last Will left the testator’s entire estate to his late wife’s daughter and named his lawyer as his executor. The son brought proceedings to challenge the Will and argued that the lawyer could not sell estate property because he was a party to the will challenge and therefore in a conflict of interest. But the court dismissed the application. The son was not a beneficiary under the latest Will and, unless he was successful in the will challenge, the lawyer did not owe him any fiduciary duties.
Her Honour also found that the fact that Judith was ill had only minimal or no effect on her vulnerability. Besides, there were two pieces of evidence which clearly indicated that Judith was capable of independent decision making. One was her letter to Caroline shortly before she died, which was lucid and expressive. The other was the written attestation of two doctors in March 2022 which confirmed that Judith was capable of providing informed consent for her assisted dying process.
Consequently, her Honour followed Lugarich, and held that Caroline did not have any fiduciary duty to the beneficiaries of the 2018 Will and therefore was not required to give notice to them of the 2022 Will. She dismissed the application and awarded partial indemnity costs to the Respondent.
—
[1] 2024 ONSC 921.
[2] 2021 ONSC 7294.
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