Turner Estate v. Bezanson

Turner Estate v. Bezanson Court Court of Appeal Date 1995-07-12 Citation 1995 NSCA 124 Docket CA 115098 Judge/Registrar/Adjudicator Pugsley, Ronald N. (Honourable Justice); Roscoe, Elizabeth A. (Honourable Justice) (CA); Flinn, Edward J. (Honourable Justice) Document Type Decision Decision Content C.A. No. 115098 NOVA SCOTIA COURT OF APPEAL Cite as: Turner Estate v. Bezanson, 1995 NSCA 124 Roscoe, Pugsley and Flinn, JJ.A. BETWEEN: MARY BARRY, Administratrix of the Estate of Eugene Turner ) Bernadette C. Maxwell and ) Nancy Elliott, Appellant ) for the Appellant ) ) - and - ) ) ) Wendy J. Johnston, Cheryl Hodder ) and Rene Gallant ) for the Respondents DELORES BEZANSON AND LARRY ) BEZANSON ) Respondents ) ) ) Appeal Heard: ) May 30, 1995 ) ) Judgment Delivered: ) July 12, 1995 ) ) ) THE COURT: Both the appeal and the cross-appeal are dismissed. Costs are awarded to the respondents in the amount of $1,000.00, together with disbursements payable by Ms. Barry in her capacity as Administratrix of the Estate, per reasons of Pugsley, J.A., Roscoe and Flinn, JJ.A. concurring. Pugsley, J.A.: Mary Barry, Administratrix of the Estate of her late brother, Eugene Turner, appeals from the decision of a judge of the Supreme Court, dismissing her action to set aside Mr. Turner's designation of Ms. Barry's daughter, Delores Bezanson, as beneficiary of certain benefits, aggregating approximately $81,000.00, arising on Mr. Turner's death. The assets of the estate were barely sufficient to pay the liabilities. Background: Eugene Turner, a bachelor without issue, in his 59th year, died of an AIDS related illness on March 3rd, 1993, while a patient at the Victoria General Hospital in Halifax. He was survived by three sisters, two of whom resided in Yarmouth, the third, Mary Barry, lived in Halifax. Ms. Barry is illiterate, lives in public housing and is in receipt of a social assistance disability pension. Mr. Turner stayed at Ms. Barry's apartment on two separate occasions, for a total of 15 days, during the course of his last illness which commenced in mid-December, 1992. Mr. Turner had worked for approximately 18 years as a janitor at the Department of National Defence. He paid into a contributory superannuation plan which provided for a death benefit roughly equivalent to two times his annual salary. Prior to June 18th, 1993 he had not "designated" a beneficiary, hence the death benefit, to that point in time, would have been paid to his estate in the event of his death. He ceased working on November 30, 1992 but had sufficient leave accumulated to collect full salary up to and including January 5, 1993. He then went on sick leave without pay. He requested his niece, Delores Bezanson, to assist him in obtaining unemployment insurance benefits, as well as long-term disability benefits. Mrs. Bezanson was 36, married, and she and her husband, Larry, have two children. Mrs. Bezanson had completed Grade 11 and at the time of the issues arising in this case, worked at H.H. Marshall's Limited in Halifax. Larry Bezanson obtained the necessary papers from Mr. Turner's place of employment and he and Mrs. Bezanson went to the hospital on or about January 13, 1993 to obtain Mr. Turner's signature to some of the forms required. Delores Bezanson testified that during this visit, Mr. Turner: - Asked her to promise that he would be buried in Yarmouth with a simple funeral and a closed casket; - was concerned that Darren Rogerson, his companion for the past seven years was taking his money; - did not wish several family members, including his sister Mary Barry, as well as Mr. Rogerson, to get his money; - wanted her to be his beneficiary. Larry Bezanson confirmed the evidence given by his wife and testified that Mr. Turner: - told Delores he wanted her to have his money - "There's enough there for you to put on your house and put some away for the kids."; - told Mr. Bezanson to get in touch with specified individuals at DND who had the necessary papers for completion of the designated beneficiary forms. Mr. Bezanson, alone, attended at the hospital on January 18th to obtain Mr. Turner's signature on some disability forms, as well as a form received from DND, to designate the beneficiary of Mr. Turner's superannuation plan. Mr. Bezanson was with Mr. Turner for in excess of thirty minutes and testified: - Mr. Turner "was good. We just chatted and he talked good. ...just as good as he could be, like, he wasn't disoriented." - The head nurse of the floor was requested to attend to witness Mr. Turner's execution of the death benefit form. She asked Mr. Turner what "he wanted". He replied he wanted "his niece, Delores Bezanson". - Mr. Turner signed the document. - When given the document to witness the signature, the nurse, referring to the instructions on the form, pointed out that Mr. Bezanson could witness Mr. Turner's execution, as he was a person "other than the beneficiary". - Mr. Bezanson then witnessed Mr. Turner's signature. - He was unable to identify or locate the head nurse to give evidence at trial, as the hospital department had since closed. Decision of the Trial Judge After a careful review of the facts, the trial judge concluded that "Mr. Turner had a sound and disposing mind on January 18, 1993, and further, there was no evidence leading me to the conclusion that there was undue influence". He further determined that: The familial relationship here - uncle and niece -was not such as to give rise to a presumption of undue influence. ... There was no dominant relationship in existence here which precipitated the gift. I conclude on the evidence before me that the presumption of undue influence has not been established. Even if the presumption had been raised, factually I have been persuaded by the evidence of Mr. and Mrs. Bezanson that Mr. Turner made the gift as a result of his own full, free and informed thought. Finally, he determined that the superannuation plan was the equivalent of an insurance policy and that the beneficiary designation form was completed properly and in accordance with the requirements of s. 173 of the Insurance Act, R.S.N.S. 1989 C. 231. The action was accordingly dismissed. Issues: Ms. Barry raises the following issues: 1. The beneficiary designation is a testamentary disposition and does not comply with the requirements of the Wills Act, R.S.N.S. 1969, C. 340. 2. The beneficiary designation form was not properly and validly executed according to the requirements of the Public Service Superannuation Act, R.S.N.S. 1989, C.377. 3. Mr. Turner did not possess testamentary capacity on January 18, 1993 when he executed the beneficiary designation form. 4. The Bezansons have not satisfied the burden to dispel the suspicious circumstances surrounding the execution of the document. 5. The Bezansons have failed to rebut the presumption of undue influence. 6. The trial judge erred in finding the document to be valid in the absence of testimony by corroborating witnesses as required by s. 45 of the Evidence Act, R.S.N.S., 1989, C. 154. 7. The trial judge made palpable and overriding errors in findings of fact and credibility. The Bezansons have filed a cross-appeal, submitting the trial judge wrongly exercised his discretion in failing to award them trial costs. Several of the issues raised on behalf of Ms. Barry involve findings of fact by the trial judge, which counsel requests be set aside. Our function is not to retry the case. The leading Canadian case stipulating a test for reviewing findings of fact is Stein v. The "Kathy K", [1976] 2 S.C.R. 802 where Ritchie, J. on behalf of the court stated at 808: These authorities are not to be taken as meaning that the findings of fact made at trial are immutable, but rather that they are not to be reversed unless it can be established that the learned trial judge made some palpable and overriding error which affected his assessment of the facts. While the Court of Appeal is seized with the duty of re-examining the evidence in order to be satisfied that no such error occurred, it is not, in my view, a part of its function to substitute its assessment of the balance of probability for the findings of the judge who presided at the trial. In my opinion, it has not been established that the trial judge made any "palpable and overriding error" respecting Issues two and three, and the grounds of appeal relating thereto should be dismissed. Issue No. 1 - Is the Beneficiary Designation a testamentary disposition complying with the Wills Act? The trial judge concluded that the designation signed by Mr. Turner on January 18, 1993, constituted a testamentary gift. This conclusion is not contested by counsel. It is in accord with the decision of Hughes, J. on behalf of the majority in MacInnes v. MacInnes, [1935] 1 D.L.R. 401 (S.C.C.) at 407 where he stated: ...the words of Sir J. P. Wilde in Cock v. Cooke (1866), L.R. 1 P.& D. 240 at p. 243 are frequently quoted: It is undoubted law that whatever may be the form of a duly executed instrument, if the person executing it intends that it shall not take effect until after his death, and it is dependent upon his death for its vigour and effect, it is testamentary. Shortly afterwards, Lord Penzance in Robertson v. Smith & Lawrence (1870) 2 P. & D. 43, said that the guiding principle in determining whether a paper was or was not testamentary was this - that it would be held testamentary if it was the intention of the maker that the gifts made by it should be dependent on his death. The definition of a will contained in the Wills Act, C. 505 S.N.S. 1989, includes a "codicil, an appointment by will or by writing in the nature of a will .. and any other testamentary disposition". It is clear that the designation executed by Mr. Turner on January 18, 1993, did not meet the requirements of sections 6 or 12 of the Wills Act. Section 6 provides in part: No will is valid unless it is in writing and executed in a manner hereinafter mentioned: ... (b) such signature shall be made or acknowledged by the testator in the presence of two or more witnesses present at the same time ... Section 12 provides in part: Every devise, bequest or appointment, other than a charge or direction for the payment of debts, to an attesting witness of the will, or to the wife or husband of such witness, is void. ... The trial judge concluded, however, that the superannuation plan was the "equivalent of an insurance policy". He referred to s. 173(g) of the Insurance Act, R.S.C. 231 which provides: "declaration" means an instrument signed by the insured (i) with respect to which an endorsement is made on the policy, (ii) that identifies the contract, or (iii) that describes the insurance or insurance fund or a part thereof, in which he designates, or alters or revokes the designation of his personal representative or a beneficiary as one to whom or for whose benefit insurance money is to be payable; Although not directly referred to, the trial judge presumably considered the provisions of s.194(1) of the Insurance Act which provides: A designation in an instrument purporting to be a will is not ineffective by reason only of the fact that the instrument is invalid as a will or that the designation is invalid as a bequest under the will. The attention of the trial judge was not directed to the Beneficiaries Designation Act, C. 36, 1989, S.N.S. This Act defines the word "plan" to mean: ...a pension, retirement, welfare or profit-sharing fund, trust, scheme, arrangement or other plan established for the purpose of providing pensions, retirement allowances, annuities, or sickness, death or other benefits to, or for the benefit of, employees, former employees, agents and former agents of an employer, or any one of them, and for the surviving spouses, dependants or other beneficiaries of any of them. The contributory superannuation plan to which Mr. Turner contributed clearly was a plan coming within this definition. Section 3 of the Act provides: Where, in accordance with the terms of a plan, a participant, by a written instrument signed by him, or on his behalf by another person in his presence and by his direction, has designated a person to receive a benefit payable under the plan in the event of the death of the participant, (a) the employer is discharged on paying to the person designated the amount of the benefit; and (b) subject to s. 4, the person designated may, on the death of the participant, enforce payment of the benefit to himself for his own use. The designation of the Superannuation Fund meets the requirements under the Beneficiary Designation Act as: (i) it constitutes a "plan" as defined under s. 2(d); (ii) the Beneficiary Designation Form is a written instrument; (iii) it was signed by Eugene Turner; (iv) it complied with the terms of the plan as per the manual which required the form be witnessed by a person other than beneficiary; (v) it identified Delores Bezanson as the beneficiary. The trial judge concluded: The Department of Supply & Services of Canada maintains a manual concerning the administration of superannuation, including the requirements for the naming of beneficiaries. I have concluded that the designation form was completed properly. The identification of Mr. Turner was completed by Mrs. Buchanan and was correct. On the face of the form the designation of Mrs. Bezanson as beneficiary is correct. The execution by Mr. Turner, as well as his expressed intention, in the light of these findings by the trial judge, satisfies the provisions of s. 3 of the Act. Section 7 of the Beneficiaries Designation Act is similar to the provisions of s. 194(1) of the Insurance Act and provides: A designation contained in an instrument purporting to be a will is not invalid by reason only of the fact that the instrument is invalid as a testamentary instrument, and it may be revoked or altered by any subsequent designation. The amendments to the Insurance Act referred to by the trial judge, and the provisions of the Beneficiaries Designation Act, were apparently enacted to overcome the impact of MacInnes v. MacInnes (supra). (See Norwood on Life Insurance Law in Canada, 2nd ed. (1993) Carswell, p. 222, footnote 3, and Hurzin v. Great West Life Assurance Company (1978), 23 B.C.L.R. (2d) 252.) In MacInnes v. MacInnes (supra) the court concluded that a document signed by the testator before the execution of his will, which created a trust in favour of his wife to an interest he held in an employees' profit sharing fund, to take effect upon his death, was testamentary in character, and was void under the Wills Act because it was only attested by one witness. While the document is valueless as a testamentary disposition because it does not comply with the Wills Act, it does operate as a proper and valid designation of the death benefit by reason of s. 7 of the Beneficiaries Designation Act. (See comments of Middleton, J.A. in Re Wythe (1926) 4 D.L.R. 1083, Ont. S.C.) Issue No. 4 - The Bezansons have not satisfied the burden to dispel the suspicious circumstances surrounding the execution of the document. Issue No. 5 - The Bezansons have failed to rebut the presumption of undue influence. Counsel for Ms. Barry points to the following evidence in support of the submission that the "doctrine of suspicious circumstances" should be invoked: - The Bezansons, through Mr. Bezanson's agency, became the beneficiaries of all that Mr. Turner had to give, to the exclusion of his estate; - There was no apparent reason for such a substantial gift; - Mr. Turner had no independent advice regarding the beneficiary designation; - It is uncertain whether the beneficiary's name was on the document when it was signed; - At the time the gift was made, the donor was extremely ill in hospital; - The beneficiary designation was executed within approximately one week of the Bezanson's discovering how ill Mr. Turner was and taking over his financial affairs. The doctrine of suspicious circumstances having been established, counsel submits that the burden is on the Bezansons to demonstrate not only due execution and capacity, but "the righteousness of the transaction". The Bezansons, it is argued, must establish they did not "take advantage of" Mr. Turner in his "weakened and compromised" position. The trial judge recognized that Mr. Bezanson's trial evidence respecting the timing of the insertion of Delores Bezanson's name as beneficiary on the form, was a "somewhat different version" than the evidence he gave on discovery. At trial, Mr. Bezanson testified he filled in his wife's name before Mr. Turner signed the form. On discovery, his evidence was: I can't say for certain, but I think he signed it, it was verbally mentioned, and then filled it in afterwards and then I witnessed it. Although not explicitly resolving this difference in the evidence, the trial judge commented: The signing of the form and the filling in of the beneficiary's name on the basis that Mr. Bezanson's evidence, was one continuous transaction. There is some doubt as to whether Mrs. Bezanson's name was filled in before the signature, but the fact was that the signature and the printing in of the designation were all done contemporaneously. The trial judge was prepared to assume, at least for the purpose of considering counsel's submission, that Mr. Bezanson "presented to Mr. Turner a blank form and then filled in his wife's name after it had been signed" . The trial judge continued: I agree. It was a suspicious circumstance. I am satisfied, however, that Mr. Turner knew what he was signing and knew the effect of it. While the only evidence before me as to the precise words used at the time of the signing were those related to me by Mr. Bezanson, I have accepted Mr. Bezanson's evidence as truthful. Mr. Bezanson's evidence alone might not have been sufficient to allay my suspicion, but the evidence of Mr. Glasgow, Mr. Cornelius and Margaret Rose Barry persuaded me that his testimony accorded with their observations. Mr. Bezanson's testimony concerning the execution of the form had the ring of truth about it. The recent decision of Sopinka, J., on behalf of the Court in Vout v. Hay et al (File No. 24009, S.C.C. June 22, 1995) makes it clear that a finding of suspicious circumstances does not place on the propounder of a will the burden of negativing fraud and undue influence, but only the burden of knowledge, approval and testamentary capacity. The burden of proof respecting fraud and undue influence "remains with those attacking the will" (Vout v. Hay (supra) para.28) Here the trial judge concluded not only that Mr. Turner made the gift "as a result of his own full, free and informed thought" but also that the presumption of undue influence had not been established. In reaching his conclusions on this issue, I am of the opinion, that the trial judge committed no error of law. In addition, his conclusions of fact were fully supported by the evidence. Issue No. 6 - The Trial Judge erred in finding the document to be valid in the absence of testimony by corroborating witnesses as required by Section 45 of the Evidence Act, S.N.S. 1989, C-154. The section states in part: ...In any action ... by or against the heirs, executors, administrators or assigns of a deceased person, an opposite or interested party to the action shall not obtain a verdict, judgment, award or decision therein on his own testimony, or that of his wife, or both of them, with respect to any dealing, transaction or agreement with the deceased, or with respect to any act, statement, acknowledgment or admission of the deceased, unless such testimony is corroborated by other material evidence. Earlier decisions of this Court establish that this section did not necessarily require another witness who swears to the same thing. (Re MacDonald Estate (1924) 56 N.S.R. 451 (C.A.) but merely "evidence that supports the case in a material way". (Johnson v. Nova Scotia Trust Company et al (1973), 6 N.S.R. (2d) 88 (C.A.)). It is pertinent that the trial judge was not asked to consider s. 45; however, in considering the issue of "suspicious circumstances" the trial judge made the following finding: Mr. Bezanson's evidence alone might not have been sufficient to allay my suspicion, but the evidence of Mr. Glasgow, Mr. Cornelius and Margaret Rose Barry persuaded me that his testimony accorded with their observations. This finding, in my opinion, provides the corroboration "by other material evidence" that s. 45 of the Evidence Act requires. I would therefore dismiss this ground of appeal. Issue No. 7 - The learned trial judge made palpable and serious errors in his findings of fact and credibility. Counsel on behalf of Ms. Barry submits that the trial judge made palpable and overriding errors in finding the Bezansons credible and that his decision discloses a lack of appreciation of, or disregard for the relevant evidence of Ms. Barry's witnesses. I have examined the transcript with respect to all the points made by counsel and in my opinion the trial judge did not make any error of law, nor did he commit any palpable or overriding error with respect to the facts. I would dismiss this ground of appeal. Costs - Cross-Appeal The Bezansons have filed a cross-appeal seeking trial costs on a party-and-party basis against Ms. Barry in her capacity as Administratrix of Mr. Turner's Estate. The trial judge declined to award costs, stating: I have concluded that the action must be dismissed. Mrs. Barry, however, took this action in her representative capacity as Adminstratrix of Eugene Turner's Estate. Neither Mrs. Barry nor the Estate should be liable for costs. There will, therefore, be no costs awarded. The costs of a proceeding normally follow the event (Civil Procedure Rule 63.03(1)), but costs are always in the discretion of the court (C.P.R. 63.02(1)). The discretion of the court to deprive a successful litigant of his or her costs is a discretion which must, of course, be exercised judicially, and upon proper material connected with the case, or having relation to the subject matter of the action (Currie v. Thomas (1985), 19 D.L.R. (4th) 594). While sympathy alone is not a proper ground on which to deny costs to a successful party (Goldboro-Bayview District Board of Trade v. Callahan (1981), 46 N.S.R. (2d) 451), in my opinion there were cogent reasons justifying the decision of the trial judge not to award trial costs to the Bezansons. An administrator is, by virtue of the letters of administration granted in this province, required to "recover and receive all the ... credits which ... at the time of death did in any way belong to the estate". It was entirely reasonable for Ms. Barry to commence this action, particularly when one considers the comments made by the trial judge with respect to the "suspicious circumstances" surrounding the execution of the document and Larry Bezanson acting as sole witness of Mr. Turner's execution. I accordingly would not interfere with the exercise of the discretion of the trial judge in refusing costs at trial. The cross-appeal should therefore be dismissed. Disposition I would dismiss both the appeal and the cross-appeal. Since the Bezansons have been successful on most of the issues raised in this appeal, I would award costs to them in the amount of $1,000.00 together with disbursements payable by Ms. Barry in her capacity as Administratrix of the Estate. In the circumstances of an appeal, Ms. Barry is in no better position than any other appellant and under ordinary circumstances if the appeal fails, costs should follow the event. In this respect, I consider the situation analogous to that where a trustee has a right to indemnity out of a trust fund in a case in which he reasonably and properly applies to a court for directions in the administration of the trust. Once an appeal is taken, costs should follow the event (Westminister Corp. v. Rector & Wardens of St. George, Hanover Square (1909), 1 C.H. 592 at 614). Pugsley, J.A. Concurred in: Roscoe, J.A. Flinn, J. A. C.A. No. 115098 NOVA SCOTIA COURT OF APPEAL BETWEEN: MARY BARRY, Administratrix of the estate ) of Eugene Turner ) Appellant ) ) ) - and - ) REASONS FOR ) JUDGMENT BY: ) ) Pugsley, J.A. DELORES BEZANSON and ) LARRY BEZANSON ) Respondents ) ) ) ) )