Jefferson v. Jefferson

Jefferson v. Jefferson

Applying the prudent adult test as articulated in Re Irving and Sandwell, the court found that the proposed collapse of the Karen Trust and payment of trust property to Karen provides sufficient benefit (including non‑financial benefits and testamentary intentions) such that a prudent adult would accept; accordingly the deed of arrangement dated May 1, 2024 is approved on behalf of Karen's unborn grandchildren and no specific testamentary gift to unborn grandchildren was required as a condition of approval.

Citation
2024 BCSC 2107
Parties
Petitioner: Karen Elizabeth Jefferson; Respondent / Sole Trustee of the Roberta Jefferson Trust and Trustee of the Karen Trust: Ann Louise Jefferson; Respondent (unborn Beneficiaries): Unborn Issue of Karen Elizabeth Jefferson
Court
Supreme Court of British Columbia
Jurisdiction
Canada
Judgment Date
6 September 2024
Procedural Posture
Variation of Trust (trust and Settlement Variation Act) / Application for Court Approval (in Chambers Oral Reasons)
Outcome
Order granted: approval of deed of arrangement collapsing the Karen Trust and distributing the trust property to the life beneficiary (Karen) on behalf of unborn beneficiaries.
Legal Topics
Variation of Trusts, Unborn Beneficiaries, Deed of Arrangement, Role of Public Guardian and Trustee, Costs
Source Language
English
Trusts Estates Civil Procedure Variation of Trusts Unborn Beneficiaries Deed of Arrangement Role of Public Guardian and Trustee Costs

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Parties

Karen Elizabeth Jefferson

Petitioner

Ann Louise Jefferson

Respondent / Sole Trustee of the Roberta Jefferson Trust and Trustee of the Karen Trust

Unborn Issue of Karen Elizabeth Jefferson

Respondent (unborn Beneficiaries)

Procedural Posture

Variation of Trust (trust and Settlement Variation Act) / Application for Court Approval (in Chambers Oral Reasons)

Legal Issues

  1. 1 Whether the proposed variation (collapse) of the Karen Trust should be approved on behalf of unborn beneficiaries
  2. 2 Whether non‑financial benefits and testamentary intentions of the life beneficiary suffice as a benefit to unborn beneficiaries
  3. 3 Whether the court should require a specific testamentary gift to unborn grandchildren as a condition of approval

Ratio Decidendi

Applying the prudent adult test as articulated in Re Irving and Sandwell, the court found that the proposed collapse of the Karen Trust and payment of trust property to Karen provides sufficient benefit (including non‑financial benefits and testamentary intentions) such that a prudent adult would accept; accordingly the deed of arrangement dated May 1, 2024 is approved on behalf of Karen's unborn grandchildren and no specific testamentary gift to unborn grandchildren was required as a condition of approval.

Court Disposition

Order granted: approval of deed of arrangement collapsing the Karen Trust and distributing the trust property to the life beneficiary (Karen) on behalf of unborn beneficiaries.

Orders

  • The deed of arrangement dated May 1, 2024, attached as Schedule A, is approved on behalf of the unborn grandchildren of Karen Elizabeth Jefferson.
  • The trustee may hold back a reasonable amount of trust property for remaining trust expenses prior to distribution.