Precise Language Needed to Create Inviolable Discretionary Trusts: MBCA

Lawyers drafting discretionary Henson trusts should heed the advice of the Court of Appeal in Thomas v. Director, Employment and Income Assistance Programs, 2013 MBCA 91 to "use consistent wording where no difference in meaning is intended." The court overturned the Social Services Appeal Board decision (disentitling a disabled beneficiary to social assistance on the basis that the trust created in his father's will was not a qualifying discretionary trust), but took pains to point out that the controversy was created by the drafter's use of two slightly different phrases in the will to describe the trustee's discretion.  In the court's opinion the testator clearly intended to create an absolute discretionary trust. 

Prompt Response Required to Challenge Interpretation of Will: MBQB

Applications to set aside a court order under rule 38.10 must be brought promptly according to the court in Estate of Joseph McMurachy, 2013 MBQB 228, and the decision as to whether the party has acted promptly is in the discretion of the judge hearing the application. In this case the court found the two year delay in proceeding to be excessive. The court declined to set aside its original interpretation of a holograph will, despite acknowledging that it had failed to ensure that a potential interested party had been served with notice of the court applications pertaining to the will. The court also found there was no triable issue with respect to the original interpretation of certain interlineations in the will.

Husband's Best Interests Served by Wife: MBQB

In Kumpolt v. Kumpolt, 2013 MBQB 224, the court granted a wife's motion to vary a 2009 order of committeeship by appointing her as committee in place of the Public Trustee. The original Public Trustee committeeship had been put in place when the wife was barred from attending the hospital in which her 82-year-old husband was a patient. The Public Trustee had arranged to have the husband transferred to a nursing home, but had subsequently entered into a placement agreement with the wife under which the husband was permitted to return home under Public Trustee supervision. The court thought it unlikely that the wife would interfere in future hospitalizations given the negative consequences of her previous behaviour.

Opportunism Backfired: MBQB

In 3434273 Manitoba Ltd. v. Nowak, 2013 MBQB 214, the court granted damages in lieu of specific performance to a husband and wife corporation whose attempt to purchase a condo in a private real estate deal was thwarted when the owner developed "seller's remorse," refused to close the deal, and ultimately sold to someone else a year later. The parties used a non-standard agreement that was prepared and signed without legal advice.  The decision reviews the contracts principles at play in private real estate deals and outlines how damages are used to compensate a purchaser in substitution for a decree of specific performance. It is also a cautionary tale for those who think they will save money by avoiding broker fees and legal advice.  

Recommended Reading

Report on Common-Law Tests of Capacity ≠- the final report from the British Columbia Law Institute project on tests of capacity deals with "how the law determines whether a person has the mental capacity to make a legally effective decision, to enter into a transaction, or to form a relationship with another person." The 200 page report examines how the various tests for capacity developed and concludes with 31 recommendations to reform the law governing selected tests for capacity. Also available on the Institute's website are the consultative documents and backgrounders that informed the project.

GST traps for the unwary - this Law Society of British Columbia Insurance Issues publication identifies the GST issues that arise in real estate and commercial transactions and offers tips on how to deal with them.

CharityTalk - the latest edition of the CBA's Charities and Not-for-Profit Law section newsletter contains articles on drafting purposes for charitable registration; what charities need to know about amendments to the Corruption of Foreign Public Officials Act; grounds for revocation of charitable registration; and the criteria for status as a "municipal or public body performing a function of government in Canada."

The November 2013 edition of the CBA's Real Property Law section newsletter contains articles on the recent SCC decision on specific performance , drafting purchase and sale agreements, and  municipal planning issues.

Signing on the dotted line easy as 1-2 in the digital world - this Canadian Lawyer article discusses how different provinces treat use of electronic signatures in real estate transactions.

Mandatory CPD Compliance Options: LSM

If you haven't yet fulfilled your 2013 mandatory cpd obligations you are running out of time. If you still need hours the Law Society is offering one more live program in December, Working with Immigrants and Newcomers to Canada (lunch program, December 16), and has scheduled several dvd replays of past popular programs: Evidence for Trial Lawyers (December 16); Revisiting Younger's 10 Commandments: Classic Rules for Cross-Examination (December 17); Hot Topics in Real Estate 2013, Part I (January 8, 2014) and Part II (January 9, 2013), and Death Bed Wills (January 13, 2014).

Leadership Skills Series: Tools, Techniques and Strategies

The Law Society has developed a series of continuing professional development sessions designed to help lawyers become leaders. The next session in the series, Resilience and Embracing Change, focuses on change management. It is designed to help lawyers manage the people side of change and support themselves and their staff through transitions. It takes place February 7, 2014, from 9:00 a.m. to 3:00 p.m. at the Law Society classroom. Presenters Judy Mathieson and Denise Zaporzan will also host upcoming sessions in the series: Generational Diversity: Maximize Performance Throughout Your Organization (March 14, 2014), and Presenting With Confidence  (May 29, 2014). Register for more than one session and save money.

2014 MBA Mid-Winter Meeting

The Manitoba Bar Association's Mid-Winter Conference will be held January 23-25, 2014, at the Fairmont Hotel. Continuing professional development sessions are scheduled all day Thursday and Friday, and include two sessions on Farming Operations for the 21st Century, sponsored by the Real Property Law section. 

Upcoming STEP Programs

The Winnipeg branch of the Society of Trust and Estate Practitioners (STEP) is presenting the following programs in the new year: Freezing an Investment Portfolio: the Pros, Cons and Process (January 21, 2014), US Cross Border Issues (February 18, 2014), Charitable Giving Strategies (March 20, 2014), and Testamentary Trusts (May 13, 2014). To register, or for details on how to become a member of STEP, check the website.