Contesting a will in Ontario: Canadian tax lawyer guide

Introduction: Testamentary Freedom and its Restrictions in Ontario

David J Rotfleisch, CPA, JD is the founding tax lawyer of Taxpage.com and Rotfleisch & Samulovitch P.C., a Toronto-based boutique tax law corporate law firm.

In Spence v. BMO Trust Company, the Court of Appeal for Ontario confirmed that an individual has the right to "dispose of his or her property as he or she chooses" upon death. As well, the Supreme Court of Canada in Tataryn v. Tataryn Estate recognized the significance of testamentary freedom indicating that it should not be interfered with lightly" but only in so far as the statute requires." However, provincial legislations are carefully crafted to include provisions that infringe upon and restrict an individual's testamentary freedom.

For example, the Ontario's Family Law Act includes specific matrimonial rights that restrict an individual's absolute testamentary freedom. In addition, under the Family Law Act a deceased person may have certain financial obligations (i.e., spousal support) and if those obligations are not met, the surviving spouse could potentially become entitled to a claim against the deceased spouse's estate. In addition, an individual's absolute testamentary freedom could also be restricted pursuant to the definition of "dependent" under Ontario's Succession Law Reform Act. That is, individuals who fall within the definition of "dependent" under Ontario's Succession Law Reform Act may potentially be entitled to a claim against the deceased individual's estate. part V of the Succession Law Reform Act is precisely designed to provide mechanisms whereby a deceased person's estate can potentially be compelled to provide adequate and proper support to individuals who (1) meet the definition of a "dependent" under the Act, and/or (2) have not been adequately provided for by the deceased individual.

In Ontario, a person who falls within the definition of a "dependent" under the Succession Law Reform Act or who has not been adequately provided for by a deceased individual could successfully contest or challenge the deceased person's will. This article explores the grounds for contesting or challenging a will in Ontario. Yet it is important to note that contesting or challenging a will in Ontario is a complex area of law that requires detailed analysis and advice from an experienced Canadian tax lawyer. As well, if the deceased person has property outside Ontario or in foreign jurisdiction, contesting or challenging a will may potentially become more complicated. Consider contacting our Certified Specialists In Taxation Canadian tax lawyer for appropriate tax guidance with respect to contesting or challenging a will in Ontario.

Grounds for Contesting or Challenging a Will in Ontario

A will is considered valid where there is evidence that the deceased person: (i) had the testamentary capacity to make (or instruct his or her representative to make) the will; (ii) had the knowledge of the actual content in the will; (iii) approved the will; (iv) voluntarily signed the will; (v) was free of any form of undue influence, coercion or fraud at the time that the will was made and/or signed; and (vi) was not operating under any mistake beliefs when making decisions pertaining to drafting and/or executing the will. However, if there is evidence that the deceased person lacked testamentary capacity and/or that he or she did not meet any of the above-mentioned requirements, it is likely that the will may be declared invalid.

In addition, as previously mentioned, under the Family Law Act a deceased person may owe certain financial obligations to his or her surviving spouse (i.e., spousal support) and if those obligations are not met, the surviving spouse may potentially be entitled to a claim against the deceased spouse's estate.

Further, any of the deceased person's dependants may potentially be entitled to a claim against his or her estate. As previously stated, part V of the Succession Law Reform Act is precisely designed to provide mechanisms whereby a deceased person's estate can potentially be compelled to provide adequate and proper support to individuals (i.e., common-law spouse or children) who come within the definition of a "dependent" under the Act and who have not been adequately provided for by the deceased individual.

The definition of "dependent" under section 57 of Ontario's Succession Law Reform Act also includes children who are conceived and born after the deceased person's death (i.e., via in vitro fertilization). In addition, the definition of spouse under section 57 of Ontario's Succession Law Reform Act includes "two individuals who were married to each other by a marriage that was terminated by divorce". Further, the word "spouse" expands the definition of "dependent" under section 57 of Ontario's Succession Law Reform Act to include common-law partners. As such, a common-law partner may make a claim for dependent relief against a deceased person's estate and pursuant to subsection 58(1) of Ontario's Succession Law Reform Act a court may order "that such provision as it considers adequate be made out of the estate of the deceased person for the proper support of the dependent or any of them".

What Happens if the Contested Will is Declared Invalid?

If a will is successfully contested or challenged the will is declared invalid and the deceased person is deemed to have died intestate. Where the deceased person died intestate — that is, without a Will — the distribution of his or her property is governed by the statute in the application jurisdiction (i.e., Ontario's Succession Law Reform Act).

Pursuant to section 45 of Ontario's Succession Law Reform Act, if a person dies intestate or if his or her will is declared invalid, the surviving spouse is entitled to a "preferential share," in the amount of $200,000, provided that the net value of the deceased person's property is more than the preferential share. This preferential share amount is distributed to the surviving spouse before any distribution is made to the deceased person's surviving issue (i.e., children). However, if the net value of the deceased person's property is less than the preferential share, the surviving spouse is entitled to the property absolutely (Ontario's Succession Law Reform Act, subsection 45(1)).

Where a will is declared invalid or a person dies intestate and leaves a spouse and one or more issue, the residue of the deceased person's estate remaining after the distribution of the above-mentioned preferential share will be divided among the surviving spouse and children, pursuant to section 46 Ontario's Succession Law Reform Act.

However, if a will is declared invalid or a person dies intestate and he or she was not married or had any children, the distribution of the deceased person's property is governed by section 47 Ontario's Succession Law Reform Act.

As previously mentioned, a common-law partner may make a claim for dependent relief against a deceased person's estate and pursuant to subsection 58(1) of Ontario's Succession Law Reform Act and an Ontario court may order "that such provision as it considers adequate be made out of the estate of the deceased person for the proper support of the dependent or any of them". A common-law partner's claim for dependent relief could potentially succeed, regardless of whether the deceased person's will is declared invalid or if he or she died intestate.

Who Can Contest or Challenge a Will in Ontario?

Pursuant to rule 74.15 of the Rules of Civil Procedure "in addition to a motion under section 9 of the Estates Act, any person who appears to have a financial interest in an estate" may challenge or contest the will. This could include any person claiming dependent relief or a person who would be entitled to inheritance where the deceased person's will is declared invalid or if he or she died intestate.

How Can a Will be Contested or Challenged in Ontario?

A person who has a financial interest in a deceased person's estate may contest or challenge the will by filing a notice of application with the Ontario Superior Court of Justice disputing the content of the will or the manner in which the estate executor is carrying out his or her duties and obligations.

A person challenging or contesting a will may do so either before or after a Certificate of Appointment is obtained by the estate trustee. In Ontario, if a person dies with a will, his or her legal representative will need to prove their authority as estate trustee of the deceased person's will in order for the court to grant a Certificate of Appointment of Estate Trustee with a Will. However, if a person died intestate, a legal representative may need to prove his or her authority as administrator of the estate, pursuant to section 29 of the Estates Act, in order for the court to grant him or her a Certificate of Appointment of Estate Trustee without a Will. Further, where a deceased person's will is contested or challenged, the court may grant a Certificate of Appointment of Estate Trustee During Litigation.

What is the Limitation Period for Contesting a Will in Ontario?

Pursuant to section 4 of the Limitations Act, the limitation period for contesting or challenging a will in Ontario is 2 years. This limitation period does not commence from the date of death, it starts from the date "on which the claim is discovered" (Limitations Act, section 4). In addition, section 15 of Limitations Act provides that no proceeding shall be commenced "after the 15th anniversary of the day on which the act or omission on which the claim is based took place."

David J Rotfleisch, CPA, JD is the founding tax lawyer of Taxpage.com and Rotfleisch & Samulovitch P.C., a Toronto-based boutique tax law corporate law firm and is a Certified Specialist in Taxation Law who has completed the CICA in-depth tax planning course. He appears regularly in print, radio and TV and blogs extensively.

With over 30 years of experience as both a lawyer and chartered professional accountant, he has helped start-up businesses, cryptocurrency traders, resident and non-resident business owners and corporations with their tax planning, with will and estate planning, voluntary disclosures and tax dispute resolution including tax audit representation and tax litigation. Visit www.Taxpage.com and email David at david@taxpage.com. Read the original version of this article on Taxpage.com. Photo by Melinda Gimpel on Unsplash.