Section 151 of the Wills, Estates and Succession Act permits a beneficiary of a will, or in the case of an intestacy, an intestate successor to apply to court to bring or defend a claim in the name of the personal representative.

The conditions for a successful application are set out in section 151 (3) as follows:

(3)The court may grant leave under this section if

(a)the court determines the beneficiary or intestate successor seeking leave

(i)has made reasonable efforts to cause the personal representative to commence or defend the proceeding,
(ii)has given notice of the application for leave to

(A)the personal representative,
(B)any other beneficiaries or intestate successors, and
(C)any additional person the court directs that notice is to be given, and

(iii)is acting in good faith, and

(b)it appears to the court that it is necessary or expedient for the protection of the estate or the interests of a beneficiary or an intestate successor for the proceeding to be brought or defended.

In Gordon Estate, 2018 BCSC 487, Mr. Justice Milman granted leave to the University of British Columbia to bring a claim in the name of the executor of Mary Gordon’s will, David Ohori, against Mr. Ohori himself and his wife to set aside the transfer of a house from Ms. Gordon to them, as well as claims to other assets they received during her lifetime.

The University of British Columbia is alleging that the transfer of the house was gratuitous and as such the presumption of resulting trust, or in other words, the presumption that the transfer was not a gift, applies to the transfer. The University is also alleging that Ms. Gordon did not have sufficient mental capacity at the time of the transfer to confer a gift. If the claim is successful, the house and other assets will form part of Ms. Gordon’s estate, distributable under her will.

The University is the residual beneficiary of Ms. Gordon’s will, and if the transfer and other transactions stand, then there would only be about $153,000 in her estate, most of which would be distributed to other beneficiaries, with little or nothing left for the University.

To succeed in the application, it was necessary for the University to show that it was necessary or expedient to allow the University to bring the claim on behalf of the personal representative.

In this case, the University provided evidence from Ms. Gordon’s long-time lawyer, Mr. Berardino, that when he met with her before she signed a transfer of her house to Mr. Ohori and his wife, she appeared confused and he did not consider that she had the mental capacity to transfer the house. He declined to act in the transfer, but a different lawyer, Mr. Miller, considered that she had capacity and witnessed the transfer document.

In this kind of application, the judge does not make a determination on the ultimate question of whether the transfer and other transactions are valid, but rather whether there was a sufficient basis for the claim to proceed.

Mr. Justice Milman found that the University of British Columbia met the requirements to satisfy section 151. He wrote:

[49]         I have concluded that UBC should be granted leave to commence an action on the terms sought. Because the proposed action will therefore proceed, I intend to say the minimum necessary to explain my conclusion in that regard. [50]         In summary, I am not persuaded that I can properly presume that the Deceased was competent to transfer her assets and that Mr. Miller competently assessed her competence to do so, as Mr. Ohori urges me to do. There is other evidence before me, particularly that of Mr. Berardino and the results of the testing that the Deceased underwent shortly before those events, that, at the very least, calls into doubt the soundness of any such presumptions, even if they might otherwise apply. [51]         Mr. Miller did not provide an affidavit himself. His hand-written notes of his one and only conversation with the Deceased, which are attached to Mr. Ohori’s affidavit, do not elucidate his practice in interviewing persons in the Deceased’s situation. In particular, there is no description of the specific questions he asked and the specific answers the Deceased gave to support Mr. Miller’s apparent conclusion that the Deceased “was able to tell me about her assets.”  That is particularly problematic in light of Mr. Berardino’s account of how the Deceased had earlier, on more than one occasion, laboured under the false impression that she had two pieces of real property to dispose of, rather than just one. Mr. Berardino’s concerns as to the Deceased’s ongoing lack of capacity are entitled to significant weight because of his longstanding relationship with her. [52]         The observations of Mr. Miller, even if taken at face value, pertain only to the transfer of the Property. Mr. Ohori has adduced little or no evidence to support the validity of the other transfers that he received in the final months of the Deceased’s life. [53]         Finally, although I agree with Mr. Ohori that his evidence, if accepted, could rebut the presumption of resulting trust, that evidence can only be assessed properly in the context of the broader inquiry that will now have to take place into the Deceased’s state of mind, particularly her capacity to form the intentions that Mr. Ohori attributes to her.