Mawdsley v. Meshen

2010 BCSC 1099 Mawdsley v. Meshen

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Mawdsley v. Meshen, 2010 BCSC 1099 Date: 20100805 Docket: S067822 Registry: Vancouver Between: Dennis Mawdsley Plaintiff And Michael Meshen, Damon Meshen, Shirley Meshen, William Meshen, Kevin Moore as Executor of the Will and Trustee of the Estate of Joan Meshen, Deceased, the Joan Meshen Trust, Western Garden & Lawn Supplies Ltd., Meadowland Peat Ltd. Defendants And Kevin Moore as Executor of the Will and Trustee of the Estate of Joan Meshen, Deceased Third Party Corrected Judgment: The text of the judgment was corrected at paragraph 2 on August 24, 2010 Before: The Honourable Madam Justice Ballance Reasons for Judgment Counsel for the Plaintiff: D.J. Manson Counsel for the Defendants: M.V. Barnard Counsel for the Third Party H.S. McLellan Place and Date of Trial: Vancouver, B.C. June 15-19, and 22-25, 2009 Additional Written Submissions: Various dates throughout September, November and December, 2009 Place and Date of Judgment: Vancouver, B.C. August 5, 2010

INTRODUCTION [1] Joan Meshen was a woman of considerable wealth. Shortly before her death on June 17, 2006, she set into motion a series of transactions by which she transferred certain assets into joint tenancy and divested herself of her remaining assets by way of outright gifts and an inter vivos trust, the implementation of which effectively impoverished her estate. By those dispositions, as well as a fresh will made at the same time, Joan Meshen left nothing to the plaintiff, Dennis Mawdsley, her common-law spouse of 18 years. [2] The plaintiff alleges that this pre-death movement of assets was carried out as part of a deliberate scheme to deprive him of his lawful remedies contrary to the Fraudulent Conveyances Act, R.S.B.C. 1996, c. 163 [the "FCA"]. The relief that he seeks has two distinct prongs. First, he seeks orders aimed at unravelling the impugned transactions primarily on the basis they amount to fraudulent conveyances, resulting in the return of those assets to Joan Meshen's estate. Next, he seeks variation of Joan Meshen's will pursuant to the Wills Variation Act, R.S.B.C. 1996, c. 490 [the "WVA"]. He also asserts claims founded on unjust enrichment and constructive trust, express trust and resulting trust. [3] The plaintiff had also alleged that the will had been procured by undue influence and that Joan Meshen lacked the requisite testamentary capacity to validly make it. However, Dennis abandoned those allegations during the course of trial.

BACKGROUND [4] The efficiency of this complex trial was greatly enhanced by the statement of facts agreed to by counsel. [5] Because Joan Meshen and her children share a common surname, I will refer to them by their first names for convenience and without intending disrespect. I will likewise refer to the other family members, as well as the plaintiff, by their given names. Joan Meshen and her Family [6] Joan was born in 1929. In the 1940s, she married Harry Shallard. The couple had two children, Shirley and Harry, before they separated in 1954. In 1957, she married Art Meshen, who legally adopted Shirley and Harry. A third child, Michael Meshen, was born in 1961. [7] Joan was the consummate "mother hen". Her children meant everything to her and she placed them above all else, including Art. [8] Joan was no shrinking violet. The evidence portrays her as a strong-willed, independent-minded and outspoken woman. But she was also flawed. Joan had a wicked tongue which she unleashed on her loved ones. She was known to be cruel and overbearing, and could be insensitive and critical in her comments to Harry and Shirley in particular. The Meshen Family Business [9] Art was a jack of all trades. In 1964, he acquired 33 acres of undeveloped land at 7625 Meadow Avenue, Burnaby, British Columbia (the "Meadow Avenue Property"). The land consisted of a large peat bog which the family came to

refer to as the "Bog". Art developed the business of excavating the peat and mixing it with soil and other nutrients to form a product called "Garden Mix". He was the driving force behind all aspects of the business and was responsible for it gradually evolving into a profitable enterprise. [10] Art's business operated through three companies: (i) Meadowland Peat Ltd. ("Meadowland"): Incorporated in 1964, it owns the lands used in the business; (ii) Big Bend Manufacturing Ltd. ("Big Bend"): Incorporated in 1967, it owns the equipment used in the business; and (iii) Western Garden & Lawn Supplies Ltd. ("Western"): Incorporated in 1950 and acquired by Art in 1960, it is the operating company. [11] By about 1977, most of the peat had been removed from the Bog. That prompted Art to obtain a change in land use zoning in order to permit the dumping of demolition fill on the Meadow Avenue Property. After the filling of the Meadow Avenue Property was complete, Western continued to run the soil business. [12] Art's brother, Bill Meshen, began to work in Art's business in 1966 when he was just 18 years old. He has distinguished himself as a devoted and valuable employee for the better part of 41 years. Over the years, Bill worked his way up the ranks from general labourer, to machine operator, and ultimately to the position of yard manager. [13] Despite accumulating personal wealth

derived from the family business, Art and Joan were careful with their money and chose to live modestly. Art's Estate [14] Tragically, Art took his own life in October 1983. Upon his death, all of his assets passed to his widow Joan pursuant to the terms of his last will and by right of survivorship. The net value of Art's estate for probate purposes, excluding assets which he owned in joint tenancy with Joan, was stated as $1,477,272.06. Of that figure, the sum of approximately $1,094,639 was attributable to Art's shareholdings in his three companies. In addition to the shares of his companies, Art held an interest in three parcels of real property at the date of his death as follows: 1. Keith Street Property [15] Art and Joan Meshen purchased their matrimonial home at 5070 Keith Street, Burnaby, B.C. (the "Keith Street Property") as joint tenants in 1965. Upon Art's untimely death, title passed to Joan by right of survivorship. She continued to live there until her death some twenty-three years later.

2. The East 11th Lots [16] In 1959, Art purchased 2137 East 11 Avenue, Vancouver, B.C. This property comprises the two legal titles of adjoining lots 5 and 6 and is effectively 1½ residential lots (together, the "East 11th Lots"). When Art died, title to the East 11th Lots passed to Joan as the sole residuary beneficiary of his estate. From the date of Art's acquisition through to trial, the East 11th Lots have been occupied by Robert and Gladys Westenberg, longstanding friends of Art and Joan.

3. The Surrey Property [17] In 1978, each of Art and Bill acquired an undivided one-half interest in almost 10 acres of bare land located at 17496 - 92nd Avenue, Surrey, B.C. (the "Surrey Property"). Bill and his wife, Linda, constructed their family home on this property at their own expense. When Art died, title to his one-half interest passed to Joan under his will. Bill continued to occupy the Surrey Property as his home until after Joan's death. The Meshen Family Business After Art's Death [18] The Meshen children each began working in the family business as youngsters while still attending school. Joan had not been active in the management side of the family business. After her husband's unexpected death, she stepped into the breach. Art had been a tough but fair boss, and Joan proved to be the same. She and the entire Meshen family, including Bill, pulled together to maintain the business. However, it was Joan who made the final decisions on all matters of importance with input from Shirley and Bill. She also performed rather perfunctory bookkeeping duties for the companies. [19] Of the Meshen children, Shirley worked most closely with her mother in the business after Art's death. From her desk in one of the two small trailers located on the Bog, she dealt directly with customers and, over time, helped do some basic bookkeeping. She also did whatever else she was told to

do or that the business required, including loading trucks and pulling weeds in the yard. [20] Bill ran the yard, and was in charge of equipment operation and maintenance. He also helped out in the office when needed. I accept his evidence that in exchange for his continued commitment and loyalty to the family business, Joan assured him that he would one day be treated as one of the family in relation to it. [21] Harry made deliveries, and was able to operate all of the equipment. [22] From boyhood, Michael has endured difficult mental health issues. His reading and basic math skills are poor, and he has trouble communicating. He also experiences intermittent memory loss. Still, like his siblings, he has worked in the business most of his life. Michael's tasks included processing the soil, loading trucks with product, running the equipment and light mechanical work. [23] Peak season for the family business ran from January to June, and again through September and October. During the high season, Joan would attend nearly daily and would stay for several hours. She was a gregarious person and, although she did pick up the paperwork while she was there, I find that she spent the vast majority of her time talking up customers and working the phones. Infrequently, Joan would dispatch trucks, and was known to stand in when Shirley was ill. [24] There were two desks in the trailer

office at the Bog. Unlike Shirley, Joan did not have a dedicated desk. However, she maintained a home office at the Keith Street Property which is where she often performed her general bookkeeping tasks and other company paperwork. The Plaintiff, Dennis Mawdsley [25] Dennis was born in 1929. He has a grade 10 education plus several years of night school. He was a qualified electrician and at some point attained the status of project manager of some kind. He was married to Pearl for 35 years until her death in 1986. They did not have children. [26] Dennis first met Joan back in the 1950s when he was visiting her sister, who would go on to marry his best friend. Dennis also knew Art. Over the years, he and Joan would occasionally cross paths at social events, and in the spring of 1987, Dennis attended a party thrown by Joan. They kept in touch and started going together in January 1988. At Joan's invitation, Dennis moved into the Keith Street Property on the Victoria Day long weekend of that year. [27] Dennis was economically self-sufficient at the time that he and Joan began cohabiting in 1988. In about 1988, he had injured his back at work. That injury rendered him unable to continue to work, and qualified him to receive workers' compensation benefits. Dennis's principal asset consisted of his West Vancouver condominium which he and Pearl had purchased in 1982. There was no

cogent evidence of the value of his condominium at the time that he and Joan began their relationship. [28] The precise value of Joan's assets at the time that she and Dennis commenced their relationship was not in evidence. I think it reasonable to infer that her financial worth had increased from the date of Art's death. While Dennis's net worth at the time he moved into the Keith Street Property is not precisely known, the evidence supports an inference that his financial stature did not approach the level of Joan's affluence. [29] Dennis and Joan cohabited at the Keith Street Property in a marriage-like relationship for close to 18 years, from May 1988 onward. There can be no doubt that at the time of Joan's death, Dennis qualified as a common-law spouse within the meaning of the WVA. [30] By and large, Joan and Dennis were compatible. There were instances, however, when they would bicker or have a heated exchange. Dennis refused to stand for Joan's unkind outbursts or any name-calling directed at him. When he felt that her conduct was out of line, he would distance himself by retreating to his West Vancouver condominium. I am satisfied that Dennis's self-imposed breaks from Joan were infrequent and, with the exception of one protracted absence of several weeks, mostly lasted a day or two. Dennis testified, and I accept, that Joan resented it when Dennis would take refuge

at his condominium after they had a spat. Sale of Dennis's West Vancouver Condominium [31] After Dennis moved in with Joan, his West Vancouver condominium was vacant except for his cat, who evidently remained there because Joan had a large dog. A few times each week, Dennis's younger sister, Josephine Mathieson, would go there to feed the cat and use the squash court. [32] Dennis claims that starting around 1991, Joan tirelessly pestered him to sell his condominium, assuring him that the Keith Street Property was "as much his as it was hers", and that he did not need another place to live. He says that for several years, he resisted Joan's urgings that he sell his condominium. Dennis asserts that, relying on Joan's repeated representations that the Keith Street Property was as much his as hers, he finally acquiesced in September 2003 and sold his condominium for the net sum of $257,729.65. He insists that had Joan not badgered him to sell and given assurances about his entitlement to the Keith Street Property, he would have retained his West Vancouver condominium. He claims to have been absolutely shocked when he discovered after her death that she had not lived up to her promise. [33] The position of the Meshen children is that it was Art's desire that the Keith Street Property would belong to his son Michael, and that Joan had always intended to fulfill Art's wish in that

regard. They say that Dennis was well aware of that plan. Joan's Rainy Day Fund [34] As part of her bookkeeping duties, Joan would tally the customer cheques for deposit into the corporate bank account. She also controlled the cash that the business regularly received and for which it did not issue a receipt. The Meshen family and Dennis referred to this cash as the "no-receipt money". I find that Joan would routinely add roughly 20% of the no-receipt money to the business bank deposit and keep the balance for herself. She referred to the no-receipt cash that she retained as her "rainy day fund". Joan's practice was well-known to the Meshen children and to Dennis. I am satisfied however that the company accountant, Vic Border, knew nothing of it. [35] Seldom did Joan take much of a salary or any bonus from any of the companies. It seems that most of her remuneration came in the form of her retention of the no-receipt money, as well as other perks such as having certain personal expenses covered by one or more of the companies. [36] For years, Joan stockpiled her rainy day fund in the basement of her Keith Street Property and dipped into it as she wished. I accept that it was at Dennis's urging that Joan eventually moved her rainy day cash to a safety deposit box at the bank. Dennis says that he and Joan initially discussed registering the safety deposit box in their names

jointly, but he was concerned that because they frequently travelled together, access to the box would be difficult for Joan's children if they were to die at the same time. For that reason therefore, he proposed to Joan that she put Shirley's name on the box along with her own. In time, Joan's rainy day fund filled an entire safety deposit box, and then another. [37] On May 1, 1997, Joan and Shirley signed a bank document by which they became joint tenants of Joan's safety deposit boxes. Sale of the Meadow Avenue Property [38] In or around the year 2000, Home Depot made inquiries about purchasing the Meadow Avenue Property which was, by far, the single most valuable business asset. Joan canvassed the views of her children, and probably of Bill, and they were unanimously in favour of its sale. She did not solicit Dennis's wishes on the matter. [39] A realtor was engaged on behalf of Meadowland, and negotiations ensued. At some stage, Home Depot presented an offer of purchase for $12 million. However, it eventually lost interest and withdrew the offer. [40] Antham, another prospective purchaser, entered the picture around 2002 and sale negotiations were revived. Antham's offers to purchase were not in the magnitude of the one presented by Home Depot and so Joan held out for a time. [41] The negotiations with Home Depot and later with Antham spanned a number of years. I accept

the evidence of Joan's long-serving lawyer, Kevin Moore, that Joan assumed an active role in the negotiations and that many meetings were held to discuss the ramifications of the sale. Joan and Shirley were invariably present at those meetings and Dennis attended most of them; Bill, Harry and Michael participated some of the time. According to Mr. Moore, Dennis regularly spoke up during those meetings, but it was understood by all that Joan had the ultimate say on the terms of any sale. [42] The potential sale prompted Joan to retain Jim Wong, a chartered accountant, to provide advice about the tax and estate planning options available on a disposition of her Meadowland shares and/or the Meadow Avenue Property. [43] Mr. Wong prepared a lengthy opinion letter that included the suggestion that Joan consider carrying out an estate freeze and use a discretionary inter vivos trust as part of that structure. The trust concept was elaborated upon in a separate explanatory appendix to Mr. Wong's letter. The suggested trust beneficiaries were Joan, the Meshen children and Bill, and possibly Joan's grandchildren. Dennis was not mentioned. Another appendix to Mr. Wong's letter contained a summary of the facts and assumptions that he relied on, including describing Joan as a widow with three adult children, and also referring to Bill. There was no mention of Dennis in the appendix or in

the body of Mr. Wong's lengthy opinion. [44] Joan had at least one face to face meeting with Mr. Wong to discuss his recommendations. The basic theme was that Joan's estate would be left to her children and, to a lesser extent, to Bill. Among those present were Shirley, Bill, Mr. Border, and Dennis. [45] Within this same general time frame, Joan sought advice from Mr. Moore on the issues surrounding the potential sale and to consider Mr. Wong's thoughts. [46] Sometime in early 2005, Antham made an offer to purchase the Meadow Avenue Property for the price of $7.5 million. Dennis claims that Joan decided to accept the offer on "the spur of the moment" without seeking his input and indeed without his knowledge. He believes that the $7.5 million price was significantly below market value; however, there was no cogent evidence to show whether or not his belief was well-grounded. Mr. Moore was not able to recall whether Joan's children endorsed the $7.5 million offer before Joan committed to it. [47] I find that Joan accepted the offer without consultation among Dennis or her children. I also conclude that none of them were surprised or even perturbed by her unilateral action because they understood that the authority to sell the Meadow Avenue Property and to control the terms of any proposed sale rested with Joan exclusively. [48] The Antham purchase was set to close in early

August 2005. By that stage, it was too late to implement Mr. Wong's recommendations. [49] The looming deadline for the Antham purchase motivated Joan to seek renewed professional advice respecting the tax treatment and the preferred mode of distribution of the sale proceeds. She was worried that Michael would not be able to manage a substantial lump sum of money or would sit around and do nothing if he received it. Harry was in the midst of an acrimonious divorce, and had a past history of substance abuse and spendthrift ways. Joan was interested in protecting their respective shares of the proceeds from their own improvidence and, with respect to Harry's share, from any claim by his estranged spouse. The Bank Advisors [50] Joan had been a long-time client of the TD Bank and maintained professional relationships with several of its employees. Glenda Lyster [51] Glenda Lyster, a financial services representative of the bank, came to know Joan from their interactions at the bank beginning in 1989. She described Joan as a flamboyant, noisy, cheerful and sociable woman. It was her understanding from Joan that the Meshen family business would ultimately pass to Joan's children and to Bill when Joan decided to retire or at some other unspecified future time. Laura McIntosh [52] From 2000 onward, Joan was also in regular contact with Laura McIntosh at the bank. Ms. McIntosh testified

that Dennis often escorted Joan to the bank and that sometimes he would come into Ms. McIntosh's office with Joan and at other times would sit and wait for Joan to finish her banking. [53] In 2005, Joan told Ms. McIntosh about the sale of the Meadow Avenue Property. I accept Ms. McIntosh's evidence that Joan made it clear to her that the Meshen family business, which encompassed the Meadow Avenue Property, would eventually belong to her children and Bill. Barbara Wallick [54] In light of the magnitude of the anticipated sale proceeds, Ms. Lyster referred Joan to Barbara Wallick, a wealth consultant of the TD Waterhouse arm of the bank, who worked with high net worth clients. Joan and Shirley met with Ms. Wallick in January 2005 in what was to be the first of a series of their meetings with financial, tax and legal professionals over the course of 2005 and into 2006. [55] From Ms. Wallick's standpoint, the purpose of this initial meeting was to obtain a sense of Joan's personal and financial circumstances and to establish her goals. Ms. Wallick readily detected a lack of investment sophistication on Joan's part. [56] During the meeting Ms. Wallick learned about the family dynamics in general terms. Joan voiced concerns about the prospect of her sons squandering their share of the sale proceeds. I accept Ms. Wallick's evidence that one of Joan's chief objectives was to protect

Harry's share of the proceeds from a claim by his estranged spouse. [57] Ms. Wallick asked Joan about the nature of Dennis's role in relation to the sale proceeds and future planning considerations, and informed her that he could have a "claim on her assets". I am satisfied that Joan responded along the lines that Dennis "had his own money and resources; he won't go there". I accept that it was clear to Ms. Wallick from Joan's response that Joan's long-term plans for the Meadow Avenue Property sale proceeds did not include Dennis. I also accept that Joan emphasized to her that it was her children and Bill who were to benefit from the business and the sale proceeds. Given Joan's response, Ms. Wallick did not think it necessary to probe Joan any further in relation to Dennis's participation. [58] Ms. Wallick explained to Joan that by using an inter vivos trust to hold the sale proceeds, those proceeds could be insulated from the claims of the children's creditors, such as Harry's estranged spouse. She also informed Joan that a trust would enable her to control and defer distribution to her children. [59] Several meetings between Joan and Ms. Wallick took place throughout early to mid 2005. Shirley was usually present and Dennis was sometimes in attendance. It was apparent to Ms. Wallick that Dennis had a better understanding of the tax and planning strategies being discussed than

did Joan or her children. [60] Ms. Wallick testified that while she may have had in mind that implementing an inter vivos trust to hold Joan's assets could protect her estate against a claim by Dennis under the WVA, that objective was not discussed with Joan and was not her focus of interest or motivation. When pressed in cross-examination, Ms. Wallick agreed that she had explained the advantages of creating an inter vivos trust in simple terms and agreed that those simple terms encompassed the benefit of protecting against the erosion of Joan's assets from a claim by Harry's spouse and from a spouse such as Dennis. Ms. Wallick did not go so far as to agree that she had actually explained the latter protective feature to Joan directly. However, she agreed that she probably advised Joan that an inter vivos trust could be used as a WVA planning tool in a general way and I find that she likely did so. Ms. Wallick's evidence is that the potential of a WVA claim being brought by Dennis was not behind any of her advice to Joan regarding the advantages of implementing an inter vivos trust. I believe her. [61] Although Dennis participated in some of the discussions, it was obvious to Ms. Wallick that the decision about the investment and distribution of the sale proceeds was Joan's alone. Her impression was that Dennis was supportive of Joan's supreme role. Warren Fetigan [62] In

February 2005, Ms. Wallick arranged for her co-worker, Warren Fetigan, a licensed portfolio manager, to join her in a meeting with Joan. Shirley and Dennis were also present. Mr. Fetigan's focus was to customize an appropriate investment strategy for the sale proceeds; one that accommodated the diverse interests of the Meshen children and Bill, ranging from Bill's conservatism on the one hand, to Harry's inclination to bet the farm on the other. Key issues included whether the family business ought to continue to operate after the sale or be wound up and whether and how to distribute some of the sale proceeds to Joan. [63] Ms. Wallick and Mr. Fetigan laid out the income tax ramifications and the available corporate and personal planning options to Joan in the presence of Dennis, Bill and the Meshen children. [64] As the meeting progressed, it became apparent to Mr. Fetigan that Dennis was Joan's companion. At the same time, however, he understood that Joan did not intend for Dennis to receive a share of the sale proceeds. According to Mr. Fetigan, the discussions were openly premised on the footing that it was the Meshen children and Bill - and not Dennis - who would be the eventual recipients of the Meadow Avenue Property sale proceeds. [65] Mr. Fetigan testified that Joan's expressed concern was that Michael and Harry might spend their shares thriftlessly if they received

outright distributions and that she therefore wanted to defer full payment to them. Mr. Fetigan also learned that Joan was interested in protecting Harry's share from a claim by his spouse and was keen to avoid probate fees. As well, an environmental contamination issue had arisen with respect to a large parcel of land in Delta owned by Meadowland (the "River Road Property") which required attention and impacted the distribution of the sale proceeds. [66] From Mr. Fetigan's perspective, the establishment of an inter vivos trust in Joan's situation served many purposes. Those included deferring and controlling distribution of Joan's assets to the Meshen children and protecting Harry's share against a claim from his spouse. Mr. Fetigan was not aware that a deferred distribution and shielding Harry's share of the assets from his spouse might have been accomplished through a testamentary trust in Joan's will. [67] Mr. Fetigan recalled that from time to time, Joan or Shirley would ask Dennis for his thoughts on a particular matter under discussion, which included the possible implementation of an inter vivos trust, and that Dennis would express his views. I accept Mr. Fetigan's evidence that at no time during these discussions did Dennis make a comment that would indicate that he considered himself as having an expectation of ownership or some kind of beneficial entitlement to the

proceeds. In this regard, Mr. Fetigan recalled that when speaking of the proceeds, Dennis appeared to take care to preface his remarks with the phrase "If it was my money, I would do this." [68] As Ms. Wallick put it, the ongoing meetings had a significant educational component and their content was repetitive. The several advantages of using an inter vivos trust were revisited many times. Ms. Wallick and Mr. Fetigan identified the saving of probate fees as a chief benefit. They also explained additional advantages, such as empowering Joan to control the distribution of the proceeds after her death, safeguarding Harry's share against a claim by his former spouse and protecting Joan's sons generally against their own financial imprudence. Although Ms. Wallick admitted she cannot be "100 percent certain" about which of the meetings Dennis attended, she was sure that he was present when the use and benefits of an inter vivos trust were being discussed, and I find that he was. [69] Ms. Wallick and Mr. Fetigan both attended a subsequent lengthy family meeting spanning three to four hours at Shirley's home. Joan, her children, Bill and Dennis were there. The use of an inter vivos trust and other potential planning techniques were once again explored. During that meeting, Joan decided to have TD Waterhouse manage the investment of the sale proceeds and signed the necessary papers.

That step brought Ms. Wallick's involvement to an end. She agreed that at the point she stepped away from the file, Joan had not made a firm decision to settle an inter vivos trust. But nor had she rejected the idea. Involvement of Bill Macaulay [70] In the past, Mr. Fetigan had successfully collaborated with Bill Macaulay, an experienced chartered accountant specializing in tax and estate planning. In about July 2005, Mr. Fetigan began to consult with Mr. Macaulay behind the scenes on various of Joan's tax matters. [71] Mr. Macaulay credibly testified that when Mr. Fetigan first contacted him on July 28, 2005, he was told nothing about Joan having a spouse or the potential claim of a spouse. He stated that similarly there was no discussion touching on that topic when the two advisors next spoke in November 2005. Mr. Macaulay's file notes of those two conversations with Mr. Fetigan support his recollection in that there is no notation of Dennis or any WVA concern. [72] The two advisors discussed various tax planning strategies for Joan and the Meshen companies, including establishing a special type of inter vivos trust called an alter ego trust created under the Income Tax Act, available to persons 65 years and older. Joan's assets could be rolled into that kind of trust without attracting immediate tax consequences in relation to unrealized gains. During their exchange, Mr.

Fetigan mentioned that there were some issues "about the sons", and that Bill was to receive some of the sale proceeds. [73] Messrs. Fetigan and Macaulay also spoke of minimizing tax by giving the trust the ability to have a legal situs in Alberta. Their discussions also concentrated on the multiple income tax issues such as the availability of a capital gains exemption and the consequences of winding up the companies as compared to paying a capital dividend to Joan. Involvement of Kevin Moore - 2005 [74] Mr. Moore remained in the loop throughout. He was confronting the implications to Meadowland of the emerging environmental problem presented by the River Road Property. In addition, he was inquiring of others about the tax ramifications of the pending sale and the preferred way to distribute the proceeds. Mr. Moore was also briefed by Mr. Fetigan about his meetings with Joan and the other members of the Meshen family and was told that the use of an inter vivos trust was under active consideration. [75] Mr. Moore also arranged for another tax specialist, Gary Brewer, to provide tax advice. In his letter to Mr. Brewer in August 2005, Mr. Moore identified Joan's two central planning objectives to be (i) isolating the sale proceeds to the extent possible from any liabilities arising from the River Road Property contamination issue; and (ii) the distribution of the after tax

proceeds among Joan's children and Bill through a series of periodic payments made over time and controlled by Joan. I find that Mr. Moore's letter accurately summarized Joan's goals in a general way. For reasons that are not germane, Mr. Brewer's involvement was short-lived. [76] Mr. Moore and Shirley maintained regular telephone contact. Most of their discussions pertained to the sale of the Meadow Avenue Property and the environmental issue plaguing the River Road Property. [77] Beginning in early August 2005, Mr. Moore engaged in a series of discussions with Joan, frequently including Shirley, about updating Joan's estate plan and the preparation of a new will. Joan had executed an earlier will on October 26, 2000 (the "2000 Will"). Under the 2000 Will, she appointed Mr. Moore and Dennis as her co-executors and trustees. She left the Keith Street Property and its contents to Michael and the balance of her personal articles to her three children equally. Joan also bequeathed one-fifth of her shares in Meadowland to Bill (on condition that he pay his proportionate share of the applicable income tax), and gave the residue of her estate, which included the remaining four-fifths of the Meadowland shares, to her three children equally. She had made no provision for Dennis. [78] Aware that the significant sale proceeds were soon to arrive, Joan instructed Mr. Moore to draft a new

will in August 2005. He prepared a fresh draft based on those instructions and sent it to Joan in September 2005. In overview, the draft provided as follows: ● Mr. Moore was named as sole executor and trustee; ● the Keith Street Property and household articles located there were given to Michael; ● remaining personal articles were given to the three children equally; ● the shares of Meadowland were to be divided equally among the three children and Bill (with special tax provisions); ● the residue of the estate was to be held in a testamentary trust for 15 years with the income distributed equally among Joan's children and a generous discretion to the trustee to encroach on capital for one or more of them as considered advisable. Upon the 15th anniversary of Joan's death, the remaining capital was to be distributed evenly among her then living children, with a gift over to named grandchildren if all three children failed to survive the 15-year postponement. [79] I accept Mr. Moore's evidence that it was Joan's desire to control the distribution of her estate into the future and to protect her children, mostly her sons, from themselves and their creditors that drove her decision to tie up their inheritance in a 15‑year discretionary testamentary trust. [80] To the best of Mr. Moore's recollection, he and Joan did not discuss Dennis in connection with her estate plan at this

particular time. [81] In late September 2005, Mr. Moore followed up as to the status of Joan's draft will. Shirley reported that her mother was still considering its provisions. Thereafter, Mr. Moore did not speak directly to Joan about her will for roughly six months. In the meantime, he continued working on the other ongoing legal matters. Contract to Purchase the MacPherson Condominium [82] For many years, Michael had resided in a modest trailer located at the Bog. It was recognized that he would be without a home when the Meadow Avenue Property sold. Ever protective of her youngest and most vulnerable child, Joan decided, after discussions with Michael, to purchase a condominium at 133-7388 MacPherson Avenue (the "MacPherson Condominium"), for Michael to use as his home. To that end, on June 4, 2005, Joan entered into a contract to purchase the MacPherson Condominium for the price of $285,900. As the condominium was not yet constructed, Joan placed a 10% deposit to secure the deal. The contract to purchase was taken in Joan's name, not in Michael's. The plan was that after the sale of the Meadow Avenue Property, Michael would move into the basement suite at the Keith Street Property pending completion of the MacPherson Condominium. Completion of the Sale of the Meadow Avenue Property [83] The sale of the Meadow Avenue Property completed in August 2005. By December 2005,

payment to Joan by Meadowland of a significant capital dividend in the amount of $3,250,000 was on the horizon. Meetings with Advisors - 2006 [84] On January 20, 2006, Mr. Fetigan introduced Mr. Macaulay to Joan, Shirley and Dennis. I find that the discussion primarily centred around the concept of Joan rolling her assets into an inter vivos trust. Mr. Macaulay and Mr. Fetigan each reviewed the pros and cons of the trust structure as it applied to Joan's circumstances. I accept Mr. Fetigan's testimony that in considering and discussing Joan's planning options, it was never a concern that Dennis would make some kind of a claim against her assets or her estate. I accept as well that at no time did Mr. Fetigan raise with Joan the potential of Dennis bringing any such claim. [85] Mr. Macaulay was comfortable in his recollection that during this meeting he raised the prospect of using the alter ego type of trust which permitted a tax deferral until Joan's death. I am satisfied that he did so. The advantages he identified overlapped with Mr. Fetigan's and included the reduction of probate fees, the potential for splitting income among Joan's children, as well as the trustee's ability to control the children's access to the funds and safeguarding them for years to come. Another of the income tax advantages identified by Mr. Macaulay was the ability for an inter vivos trust to carry

back a capital loss for three years as opposed to the one year restriction that would govern in the absence of a trust. [86] Joan left that meeting impressed with Mr. Macaulay. A few days later, he was informed by Shirley or Mr. Moore that Joan wished to retain him to act as the tax advisor for herself and the companies. Mr. Macaulay's immediate tasks included gathering the extensive background information that he considered vital to advising Joan on ways to facilitate the capital dividend payment out of the sale proceeds and to sort out the numerous pressing tax considerations. He also began preparation of the three corporate income tax returns. Upon Mr. Macaulay taking the reins as the tax advisor, Mr. Fetigan left the picture. After the January 20 meeting, Mr. Macaulay did not interact directly with Joan again. [87] Over the ensuing several weeks, Mr. Moore and Mr. Macaulay worked in concert to prepare the required corporate resolutions and other documents connected to the payment of the capital dividend. On February 28, 2006, a sizeable capital dividend in the amount of $2,750,000, derived from the sale proceeds of the Meadow Avenue Property, was paid to Joan. She placed it into a TD term deposit pending her determination as to how to deal with it. [88] Mr. Fetigan and Mr. Macaulay were both credible witnesses and I consider their testimony to be reliable. The preponderance

of their evidence amply supports the finding that the prospect of Joan settling an alter ego type of inter vivos trust was thoroughly canvassed during the January 20 meeting in Dennis's presence and that Dennis actively participated in the discussions. Joan's intention that the sale proceeds and the Meshen family business at large was to belong to her children and Bill, and that they alone would be the beneficiaries of the trust assets, was openly discussed in front of Dennis. Discussions of those topics were not conducted in secret or deliberately orchestrated to take place in Dennis's absence. The combined evidence of Messrs. Fetigan and Macaulay establishes that during the course of the meeting, Dennis raised no objection or complaint about the notion of Joan implementing a trust to receive the benefits flowing from the sale of the Meadow Avenue Property or the companies generally, other than posing questions about the expense of its implementation and administration. As well, there is no evidence to suggest that Dennis ever attempted to dissuade Joan from following that course of action. [89] I conclude that as a result of participating in various meetings involving Ms. Wallick, Mr. Fetigan and Mr. Macaulay, as at January 20, 2006, and probably before then, Dennis understood the nature of the alter ego inter vivos trust structure as explained by those advisors, knew that it

was envisioned as a vehicle to hold the sale proceeds and possibly Joan's other corporate interests. He was also fully aware that he was not being contemplated as a beneficiary. More specifically, I conclude that as at January 20, 2006, Dennis appreciated that the implementation of an inter vivos trust would mean that the assets transferred into the trust would not form part of Joan's estate when she died and that the trust would continue after her death. [90] The crucial point here is that based on the several detailed discussions with the advisors for which Dennis was typically present and in which he participated, I find that he knew that Joan did not intend to give him any of the trust assets while she was alive or after her death. Decline of Joan's Health and Terminal Diagnosis [91] Joan complained of feeling unwell around Christmas 2005. Her symptoms persisted throughout January and February. She saw a number of doctors and underwent a series of diagnostic tests. [92] Sadly, the battery of tests that Joan had been undergoing supported the diagnosis of liver cancer. From the date that she received that devastating diagnosis in late February 2006, Joan understood that her condition was terminal. She expressed a desire to die at home. I find that until she was given that diagnosis, she was not aware of the gravity of her medical symptoms. [93] At that point, Joan's assets

had a gross value of at least $10.5 million. They consisted of a substantial investment account with TD Waterhouse (funded mainly by the $2,750,000 capital dividend payment), shares in the capital of the three Meshen companies, real estate interests (i.e. Keith Street Property, Surrey Property, East 11th Lots and the right to purchase the MacPherson Condominium), and various term deposits and bank accounts. [94] Joan's physical condition deteriorated at a rapid pace. She soon needed a wheelchair and became bedridden. Shirley moved back into the Keith Street Property in the first week of March in order to help care for her mother. Dennis had dutifully escorted Joan to her many medical appointments and tests from the time that she began to feel unwell in late 2005. He was devoted in caring for her from the moment she received her diagnosis until her death approximately 3½ months later. Transfer of Joan's Bank Accounts into Joint Tenancy [95] Soon after Joan learned that her condition was terminal, she directed Shirley to transfer her personal bank accounts into both of their names as joint tenants. On March 3, 2006, Shirley contacted Ms. Lyster at the bank and relayed her mother's request. Ms. Lyster quickly prepared the required paperwork. [96] In addition to the standard banking documents, Ms. Lyster printed out a summary of Joan's bank accounts on which she wrote the

following: "Please amend ownership on my personal acct# [account number inserted] to be joint with right of survivorship with my daughter, Shirley Meshen". Beneath Ms. Lyster's handwritten instruction she drew a signatory line for "Joan Meshen", and to the left of that, an additional line for "Witness". Ms. Lyster penned identical instructions with regard to Joan's other bank accounts, including the account that held the term deposit funded by the large capital dividend payment. [97] The evidence shows that it was Dennis who collected the banking documents from Ms. Lyster later that day, and that Ms. Lyster explained to him that Joan was to sign in the spaces indicated in the presence of a witness. Dennis brought the documents home to Joan for her signature. He signed as the witness and then returned the duly executed documents to Ms. Lyster. [98] Dennis testified that because everything was happening so fast he was not entirely sure just what it was that he and Joan were signing. He says that he was told that the papers were "just for banking signatures" and he was happy to oblige. [99] Shirley understood that she had to see Mr. Fetigan in order to sign an additional document to convert her mother's substantial term deposit into their joint names. She admitted that when she reflected upon it, she became uncomfortable with having her name on her mother's largest deposit which

was holding approximately $2.75 million at the time. Shirley explained that her hesitation stemmed from her concern that if her mother died and then Shirley were to die unexpectedly, for example, by being hit by a car, that significant deposit would pass into Shirley's estate and make it difficult for her family to access. She testified that she decided that it was preferable that the term deposit remain in her mother's name. Accordingly, she chose not to sign the further paper that Mr. Fetigan required. [100] The three bank accounts that were transferred into jointure (collectively, the "Joint Bank Accounts") held funds in the aggregate amount of approximately $138,097.42 at that time. Continued Preparation of Joan's Will [101] Mr. Moore learned of Joan's diagnosis from Shirley in late February 2006. On March 6, 2006, through Shirley, he received Joan's instructions concerning the modifications she wanted made to her draft will that Mr. Moore had sent to her the previous September. [102] As noted, a feature of Joan's original estate plan had been to give one-fifth of the Meadowland shares to Bill and her draft will had been drawn on that basis. However, because she had subsequently decided to take the capital dividend personally rather than have Meadowland retain all of the proceeds, the structure of Joan's will needed to be modified in that regard. She instructed Mr. Moore

that all of her shares, and not simply those in Meadowland, were to be distributed equally among her three children and Bill. Joan also wanted to reduce the duration of the testamentary trusts for her children from 15 to 5 years and to name her grandchildren (Harry's children) in the gift-over provision. [103] Mr. Moore's daughter, also a lawyer, began making the requested revisions to Joan's draft will right away. Pursuant to Joan's instructions, she also prepared a general enduring power of attorney and health care representation agreement for Joan to sign in favour of Shirley. There was no evidence to suggest that Joan ever contemplated empowering Dennis as her attorney or health care representative. [104] With Joan's permission, Mr. Moore and Shirley had several subsequent telephone discussions throughout March concerning revisions to Joan's will and related matters. Meeting with Mr. Moore - March 22, 2006 [105] With the revised will, power of attorney and representation agreement in hand, Mr. Moore met with Joan at the Keith Street Property on March 22, 2006. It was a lengthy meeting. Shirley and Michael were both at the house; Dennis was not. I am not persuaded that the meeting was designed to take place during Dennis's absence. [106] Mr. Moore met with Joan in her bedroom. Shirley was present at the outset, but left them to discuss matters in private after she signed the

representation agreement and power of attorney. [107] For the most part, Mr. Moore has no independent memory of the details of what was discussed at the March 22 meeting and had to rely on his notes. Not surprisingly, his notes do not capture all of the things that he and Joan discussed. I am satisfied, however, that they accurately record the aspects of their discussions which Mr. Moore found most relevant. [108] Mr. Moore is an experienced lawyer in the area of wills and estates and is well-acquainted with the provisions of the WVA. During the meeting, he drew to Joan's attention the possibility of Dennis bringing a claim under the WVA because she was not making any provision for him under her will. This was likely the first time that Mr. Moore had raised the WVA with Joan. It also marked the first occasion that Mr. Moore discussed the concept of the inter vivos trust directly with Joan. [109] I find that Mr. Moore reiterated to Joan the same general advantages of implementing an inter vivos trust that Ms. Wallick, Mr. Fetigan and Mr. Macaulay and, to a lesser extent, Mr. Wong had described to her, such as saving probate fees, privacy of the trust provisions and isolating estate assets from the creditors of her children, principally Harry. He also advised that an inter vivos trust acted as a WVA avoidance device because, as he put it, "the statute doesn't allow a WVA claimant

to claim against a trust". [110] In cross-examination, Dennis's counsel repeatedly suggested the existence of a causal link between Joan receiving advice from Mr. Moore of Dennis's entitlement under the WVA, and her decision to proceed with the inter vivos trust and other related pre-death dispositions. [111] Mr. Moore agreed that at the outset of the March 22 meeting with Joan he understood that Joan intended to dispose of her assets under her will, including by way of an ongoing testamentary trust. He also agreed that by the close of his March 22 meeting, Joan had decided to implement an estate plan by which she divested herself of substantially all of her assets before her approaching death. He acknowledged that the centrepiece of the plan was the settlement of an inter vivos trust and that other features included the funding of the trust, joint ownership with Michael of the Keith Street Property, and gifting other property interests, including her contractual rights to the MacPherson Condominium, to her children equally. Mr. Moore further agreed that he received Joan's instructions during the meeting after he had discussed the benefits of the use of an inter vivos trust, and advised her about the application of the WVA relative to Dennis. [112] At his examination for discovery, Mr. Moore acknowledged that "something happened" during the March 22 meeting to change Joan's

mind "in terms of a trust as opposed to a will". Although he adopted that evidence at trial, he also persuasively maintained that the potential of Joan settling an inter vivos trust would have been in his mind before he set out to see her on March 22. He explained that he had the trust concept in his mind before he met with Joan that day, even though he had not directly discussed it with her on any prior occasion and had not received any instructions to proceed with the implementation of one. The evidence establishes that the concept of the alter ego inter vivos trust would have been relayed to Mr. Moore by Mr. Fetigan and by Mr. Macaulay during one or more of their several discussions leading up to his meeting with Joan. [113] Although Mr. Moore agreed that he could recall almost nothing of his conversations with Joan in 2006 beyond what was set out in his notes, he convincingly testified that he had a distinct recollection, quite independent of his notes, of just how "remarkably unconcerned" Joan was about the risk of Dennis bringing a WVA claim against her estate, given that she was making no provision for him. In addressing her absence of concern, Joan informed Mr. Moore that she and Dennis had an agreement about their assets. Mr. Moore's notes cryptically record Joan's assessment of the risk of a WVA claim by Dennis as "I don't think so". I accept Mr. Moore's evidence that

Joan told him that Dennis was to receive nothing because they had agreed, although not in writing, that "what we each had was our own". His notes support that evidence and record that he asked Joan questions about Dennis such as "where will he live, what are his assets" and that Joan replied in turn, "maybe with Michael", "5000/month + 300,000 capital?". [114] While Mr. Moore acknowledged that at the March 22 meeting Joan would have known that an inter vivos trust could be used to avoid a WVA claim against her estate, he maintained that the chief rationale behind her decision to proceed with the inter vivos trust was to avoid probate fees. According to him, any WVA protection was merely incidental. [115] In designing Joan's estate plan, Mr. Moore appreciated that a claim by a common-law spouse in an 18-year relationship such as Dennis against an estate of $10.5 million potentially could be worth "millions of dollars". When Mr. Moore met with Joan on March 22, the preliminary forecasted savings of the probate fees was in the range of about $75,000. As it turned out, those fees would have been more than double that figure; however, neither Mr. Moore nor Joan were evidently aware of the substantially larger savings at that time. [116] The potential savings in terms of shielding Joan's estate against a successful claim by Dennis under the WVA clearly dwarfed any probate fee savings

that might have accrued. Mr. Moore was well aware of that. However, Mr. Moore does not believe that he told Joan that Dennis's potential WVA claim could be large or quantified it for her in any respect. He explained that because Joan appeared to be so patently unconcerned about Dennis ever launching such a claim, they spent little time discussing the subject. Mr. Moore testified that he harboured a degree of apprehension about the risk of Dennis bringing a WVA claim, but insisted that Joan simply did not share his concern. He would not agree to the suggestion repeatedly put to him in cross-examination, that Joan's decision to move forward with the inter vivos trust and her overall estate plan was driven or influenced by her understanding that it would shield her assets from a potential WVA claim by Dennis. Along the same lines, despite being forcefully cross-examined, Mr. Moore would not agree that insulating Joan's assets from a prospective WVA claim by Dennis represented one of the reasons that Joan chose to move forward with her alter ego trust, or that it otherwise informed her intention relative to the implementation of the dispositions condemned by Dennis. [117] Mr. Moore left the March 22 meeting with Joan's instructions to carry out the following: · prepare an inter vivos trust to take effect prior to her death. The trust would be funded by Joan's shares in Meadowland,

Big Bend and Western, her other corporate-related assets like her shareholder loans, and the capital dividends she had received out of the sale proceeds; · prepare the documents to transfer the Keith Street Property to herself and Michael as joint tenants; · prepare the documents by which she would gift outright her interests in the East 11th Lots and the Surrey Property to her three children; · revise her draft will to correct two inadvertent mistakes. [118] Mr. Moore now considered Joan's will to be a mere stop-gap measure. The goal was to have something in place temporarily while the inter vivos trust and related transactions to dispose of Joan's estate were put into place. For this reason, Mr. Moore regarded it as unnecessary to follow his customary practice of preparing a memorandum by which Joan would explain her reasons for not providing for Dennis in her will. [119] Mr. Moore presented as a thoroughly credible witness. Events between March 23 and April 26 [120] Mr. Moore finalized Joan's interim will and returned to her home the next day where she executed her revised will. As was the case with Joan's 2000 Will, the subsequent interim will made no provision for Dennis. [121] Also on March 23, Meadowland paid Joan a second capital dividend in the amount of $500,000 from the proceeds of sale of the Meadow Avenue Property. Those funds were deposited into her investment

account with TD Asset Management. [122] From March 23 until late April, Mr. Moore collaborated with his daughter in the preparation of the requisite documents to effect Joan's instructions. The trust indenture, most notably, was a work in progress. [123] Mr. Moore also liaised with Mr. Macaulay several times within this time frame regarding income tax and planning issues. By email dated March 31, Mr. Moore advised Mr. Macaulay that Joan remained in poor health, and that he wished to speak with him about options available to her in creating a trust "to minimize her estate's liability for probate fees as well as for other issues". Mr. Moore agreed that the "other issues" he referenced included protection against a claim by Dennis under the WVA and as best as he can recall, he likely did raise that topic with Mr. Macaulay. He also invited Mr. Macaulay's specific comments in relation to the provisions of Joan's trust. [124] In cross-examination, Mr. Macaulay was asked whether he understood that the "other issues" referred to in Mr. Moore's email included the prospect of Dennis bringing a claim under the WVA. To the best of his recollection, the first time that he and Mr. Moore talked about the WVA was on March 24, and he had some memory that the concern centred on the fact that the children's distributions were going to be subject to ongoing trusts. He was not asked to elaborate

about the contents of that discussion. Mr. Macaulay agreed that although he had no recollection of discussing the WVA again with Mr. Moore after receiving Mr. Moore's March 31 email, it was possible that he had done so. Mr. Macaulay confirmed that at no time did he raise the WVA issue with Joan. [125] Mr. Macaulay and Mr. Moore arranged to meet on April 10, 2006 to discuss the outstanding tax planning issues. Mr. Macaulay prepared a lengthy confidential draft letter addressed to Mr. Moore reviewing the various planning opportunities available to Joan for the purpose of assisting Mr. Moore in advising Joan more fully. It sets out the facts and assumptions about Joan's personal and financial affairs, the Meshen family business and the companies, which Mr. Macaulay considered pertinent to his analysis. Mr. Macaulay used his draft letter as a checklist when he met with Mr. Moore on April 10. [126] In his letter, Mr. Macaulay outlined the estate planning options based on Joan's objectives as he understood them to be from Mr. Moore and based on his earlier meeting with Joan, Dennis, Shirley and Mr. Fetigan in January 2006. He summarized those objectives as being: (i) the minimization of income tax; (ii) the reduction of the amount of probate fees payable; and (iii) the distribution of Joan's corporate shares to her children and Bill, with the balance of her estate passing equally to

her children, except for the Keith Street Property which was to go solely to Michael. He indicated that it would be counterproductive to put the Keith Street Property into the inter vivos trust because it would lose the principal residence tax exemption. Mr. Macaulay also noted that there would be significant unrealized capital gains on the East 11th Lots and Joan's interest in the Surrey Property on her death. [127] Among other things, Mr. Macaulay's letter described the ability to achieve greater tax savings by incorporating into the trust the flexibility of changing its situs to Alberta. He also attached one of his spreadsheet that showed that the probate fees could approach $157,000 in the absence of any inter vivos planning. [128] In articulating Joan's goals respecting the distribution of her assets, Mr. Macaulay asked the following in his draft letter: "[what about Dennis?]". During his meeting with Mr. Moore on April 10, Mr. Macaulay wrote "nothing to Dennis" next to that question. He confirmed that Mr. Moore had advised him of that answer. Although Messrs. Moore and Macaulay had chatted about the WVA before the preparation of this letter, Mr. Macaulay did not identify as one's of Joan's goals the notion of insulating her assets from a possible WVA claim by Dennis or anyone else. Indeed, as at April 10, Mr. Macaulay still required clarification in his mind as to whether

Dennis was to be a beneficiary. [129] During the April 10 meeting, Mr. Macaulay learned from Mr. Moore that Joan had decided to move forward with the establishment of an inter vivos trust and the other transactions. As far as Mr. Macaulay was concerned, the inter vivos trust contemplated at this stage was the very one that had been discussed from the outset of his involvement. [130] Over the course of the next two weeks or so, Mr. Macaulay and Mr. Moore continued to communicate. On April 24, Mr. Moore sent Mr. Macaulay a draft of the trust for his review and comment. Meeting with Mr. Moore - April 27, 2006 [131] Mr. Moore returned to see Joan at her home on April 27, 2006. [132] Dennis escorted Mr. Moore to Joan's bedroom, and left the two of them to their discussion. Mr. Moore was not able to recall the specifics of any discussions that took place during that meeting. He relied on his notes, which I conclude accurately record the aspects of his discussions with Joan that he found most relevant. [133] During this meeting Mr. Moore again broached with Joan the subject of Dennis not receiving any assets. His distinct recollection was that Joan reiterated that she did not believe that Dennis had any claim to her assets and was steadfast that the companies in particular were to go to her children and Bill. In this respect, Mr. Moore's notes record that when speaking about Dennis,

Joan confirmed that she "still feels no obligation (they had a deal)", and that Dennis told her that he was living at the Keith Street Property "until you kick me out". [134] Joan confirmed to Mr. Moore that she wanted to transfer the Keith Street Property to herself and Michael as joint tenants. At the same time, she expressed some worry that Michael would not be able to look after the Keith Street Property on his own and wondered "perhaps Dennis + he can make an arrangement". Despite that concern, Joan executed a freehold transfer form and a deed of gift in relation to the creation of the joint tenancy with Michael. [135] The 2006 property assessed value of the Keith Street Property was $398,600. [136] Joan also confirmed to Mr. Moore that the East 11th Lots were to be transferred to her children and that she was absolutely confident that they would not disturb the occupants, Robert and Gladys Westenberg, until they wished to leave. Joan reiterated her instructions that her children were to have her interest in the land of the Surrey Property. She explained that as far as she was concerned she only owned one-half of the land and had no ownership interest in the house which Bill had constructed at his own cost. [137] Mr. Moore's notes of the April 27 meeting reflect that Joan no longer considered the MacPherson Condominium to be needed for Michael. She instructed Mr. Moore

that the purchase agreement was to be transferred to her children to "let them do what they want". [138] Mr. Moore and his client also discussed the transfer of other assets, such as her investment account and shareholder loans into the inter vivos trust along with her corporate shares. Joan accurately reported that she had cashed in most of her RRIF and that her children were the designated beneficiaries of the remainder, and that she had no life insurance. [139] The meeting with Joan lasted 30-40 minutes and Mr. Moore chatted briefly with Dennis as he left the property. Dennis did not ask about and, quite properly given that Dennis was not his client, Mr. Moore did not volunteer the contents of the meeting or his instructions. [140] The following day, Mr. Moore telephoned Mr. Macaulay to brief him on his meeting with Joan and informed him that she approved an immediate transfer of her non-corporate property to her children. Thereafter, Mr. Moore continued to finalize the requisite documentation, and contact Shirley and Mr. Macaulay periodically as required. Involvement of Richard Weiland [141] In early May, Mr. Macaulay contacted Richard Weiland, a lawyer specializing in tax and estate planning. He provided Mr. Weiland with a working draft of the trust and sought tax advice regarding Joan's estate plan generally and the trust provisions specifically. [142] Mr. Weiland

prepared a memorandum to file summarizing his understanding of the pertinent facts in relation to Joan and her assets, together with his analysis of the issues. Paragraph 8 of his memorandum reads: [Joan] proposes to settle an alter ego trust for the purposes of minimizing probate fees and reducing her estate's exposure to potential WVA claims. A draft of the proposed trust has been provided to us by Bill Macaulay and is attached. [emphasis added] [143] At no time did Mr. Weiland communicate directly with Joan or any of her children. He prepared his memorandum, including paragraph 8, based on what Mr. Macaulay had relayed to him. [144] Mr. Weiland sent a copy of his memorandum to Mr. Macaulay for his review and input. Mr. Macaulay set about to correct certain factual inaccuracies in it and black-lined his corrections and comments. Mr. Macaulay testified that from his standpoint, paragraph 8 of Mr. Weiland's memorandum did not require any correction and he made none to it. Mr. Moore gave similar evidence. [145] Mr. Weiland recommended that some fairly substantial changes be made to the terms of the trust. His suggested edits were mainly aimed at minimizing the exposure to double taxation in the trust on Joan's death, preventing the primary beneficiaries from being able to call for an early windup of the trust and giving wider scope to the trustee's powers. Meeting with Mr. Moore

- May 2006 [146] Mr. Moore reviewed Mr. Weiland's recommendations in early May, and had at least one lengthy telephone discussion with him and Mr. Macaulay with regard to them. He then finalized the trust incorporating several of Mr. Weiland's suggestions. He also prepared Joan's final will and various other documents and went to see Joan on May 12, 2006. [147] At trial, Dennis claimed that he could not recall Joan's meeting with Mr. Moore at the Keith Street Property on May 12. That was inconsistent with his evidence on discovery where he testified that he remembered "very well" that Mr. Moore had come to the house that day. Dennis did not adequately explain that inconsistency. I find that Dennis was home that day and well aware of Mr. Moore's appointment. [148] Mr. Moore made no notes of his meeting with Joan on May 12. It is common ground that Joan settled the alter ego inter vivos trust and signed her will and several other documents in his presence that day. Mr. Moore returned to see Joan on May 29, 2006. At that time, she signed deeds of gift in favour of the Joan Meshen Trust in relation to her shareholder loans. These documents signed by Joan on May 12 and 29, 2006 brought about the transactions which, together with the jointure of the safety deposit boxes and the Joint Bank Accounts, are impugned by Dennis as summarized below. None of those dispositions were made for

valuable consideration. The Impugned Transactions i. Joan's Last Will [149] Under her will executed May 12, 2006, Joan appointed Mr. Moore as her sole executor and trustee. She bequeathed the contents of the Keith Street Property to Michael, and the remainder of her estate equally among her children. No provision was made for Dennis. [150] I will refer to this will as Joan's "Last Will". ii. The Joan Meshen Trust [151] By way of trust indenture signed on May 12, 2006, Joan established the Joan Meshen Trust. It is an irrevocable inter vivos trust that qualifies as an alter ego trust for income tax purposes. Joan is appointed as the sole trustee, with Mr. Moore as her replacement. The trust gives extensive authority to the trustee to appoint additional or successor trustees, presumably to facilitate a change of situs to Alberta if deemed appropriate. A default trustee appointment is made in favour of the Canada Trust Company (the trust arm of the TD Bank). [152] As mentioned, Joan eventually deposited her capital dividend payments totalling $3,250,000 into an investment account. By way of a deed of gift dated May 12, 2006, she transferred those funds into an account in the name of the Joan Meshen Trust. In doing so, she settled that property upon her trust. She also rolled into her trust her shareholder loans due from Meadowland, Big Bend and Western. [153] Joan is the sole

beneficiary of both the income and capital of the trust property until her death. Upon the happening of that event, two separate trust funds are created: (1) Corporate Fund: This trust fund consists of the shares of the Meshen family companies, assets into which the shares are converted and accruing income. Until December 31, 2009 or such earlier date chosen by the trustee (the "Corporate Distribution Date"), the trustee has a broad discretion to advance the net income and/or capital of the Corporate Fund to or for the benefit of one or more of the Meshen children and Bill, and is specifically directed to be generous in the exercise of that discretion. Upon the Corporate Distribution Date, the corporate fund is to be distributed equally to those of Bill and the Meshen children who are then living. If they are all dead at that time, then the remainder of the Corporate Fund passes to Joan's named grandchildren and a great-grandchild who are then alive. (2) "Children's Fund". This trust fund holds Joan's non-corporate assets, including the capital dividends received from Meadowland. The three children, and not Bill, are the beneficiaries. The distribution date is the fifth anniversary of Joan's death. Pending that date, the income of the Children's Fund is to be distributed to the three children, with power to the trustee to generously encroach on capital for one or more of them.

On the distribution date, the balance of the Children's Fund passes equally to those of the Meshen children then living, with the same gift-over provisions as apply to the Corporate Fund. [154] Dennis is not a beneficiary of the Joan Meshen Trust. iii. MacPherson Condominium [155] Joan assigned all of her interest in the MacPherson Condominium to her three children pursuant to an agreement dated May 12, 2006. iv. Surrey Property [156] Joan executed a freehold transfer document by which she gifted her undivided one-half interest in the Surrey Property to her three children. She also signed an accompanying deed of gift in their favour. [157] The appraised value of the whole of the Surrey Property as at June 1, 2006 was $1,337,500. v. East 11th Lots [158] The East 11th Lots consist of two legal titles, which I will refer to as lots 5 and 6. Joan executed a freehold transfer form gifting title to lot 5 to her three children and subsequently signed a related deed of gift in their favour. After Joan's death, it was discovered that due to inadvertence, title to lot 6 had not been transferred. [159] In the event that the transfer of lot 5 is not set aside in this proceeding, the parties consent to the Court granting rectification orders which have the effect of transferring lot 6 of the East 11th Lots to the Meshen children. [160] The 2006 assessed value of the East 11th Lots was

$455,800. There is no evidence indicating how that value is apportioned between the two lots. Joan's discussions with Robert Westenberg [161] Robert and Gladys Westenberg had been close friends of Art and Joan for decades and have occupied the premises on the East 11th Lots for more than 50 years. [162] In the early days of Mr. Westenberg's friendship with Art, the two men were also business partners. Neither of the Westenbergs appeared to be clear on precisely how legal title to the East 11th Lots ended up being transferred from the name of Mr. Westenberg and/or his father, to Art. However, neither of them suggested that Art, or following his death Joan, did not hold bona fide title to that property. [163] Mrs. Westenberg typically chatted with Joan over the telephone about twice a week. The Westenbergs' relationship with Dennis was not as warm or as close as the one they had enjoyed with Art. Their combined evidence establishes that before Joan became ill, they socialized with her and Dennis a couple of times a month; on occasion they took breakfast together or went to the casino for an hour or so. [164] Mr. Westenberg regarded Joan and Dennis as a "couple". I accept his evidence that, in the context of discussing their relationship, Joan told him that she did not plan to marry Dennis. [165] As Mr. Westenberg had been a business partner of Art's, Joan periodically discussed

business matters with him in the years following Art's death. After Joan was diagnosed with her final illness, the Westenbergs made a point of seeing her more often. It was not unusual for Joan to ask to speak to Mr. Westenberg in private when he and his wife visited, both before and after her illness took hold. During her last few months, Joan requested a private audience with Mr. Westenberg more than once. [166] Mr. Westenberg was cross-examined at length about the content of those discussions. He testified that he variously told Joan to "get on the ball" with respect to her estate, and ensure that everything was "done up right" and that the children got the "proper end of the stick". He acknowledged that in the back of his mind, he was concerned that Dennis might claim against the Meshen family business. [167] It was put to Mr. Westenberg that it was his intention in having this discussion with Joan that she ensure that Dennis not have a claim against the business. Mr. Westenberg answered that "He guessed so". He also agreed that he thought that Joan understood his concern. But then again, Mr. Westenberg also denied that he advised Joan to make sure that she did what was necessary to ensure that Dennis did not have a claim. In response to that line of questioning, he responded that he had told Joan to make sure "everything was done right" but that he never mentioned that

"Dennis should receive nothing". [168] Mr. Westenberg would not agree to the more direct suggestion that Joan herself intended that steps be taken to ensure that Dennis did not participate in the Meshen business after her death. He replied that it was not "mentioned that way" and explained that while that point had perhaps been in his mind, he had not mentioned it to Joan. At a later point in cross-examination Mr. Westenberg was probed further about what Joan meant when she told him that she "had everything up to date done right", which lead to the following exchange: Q: Well, what did she tell you? A: She told me that she got - that she had everything up to date done right. Q: And did she - in that discussion did she - excuse me - assure you that arrangements had been done right so that Dennis Mawdsley would not receive part of her estate? A: I would say yes. Q: And she didn't discuss the particulars about how that had been accomplished, it's just that it had happened? A: Well - Q: Is that fair? A: She said that she put the Keith Street house in - in Michael's name and she was getting rid of the - she got rid of the - that apartment, whatever it is, that Michael was going to go into. Q: She told - A: That's about it. Q: May I suggest to you that what she told you was that she put title to the Keith Street home in joint tenancy with her and Michael so that when she died he

would receive title to the property outside of her estate? A: Oh, is that what they did? I didn't know that. Q: All right. But in any event, what she did explain was that arrangements had been made so Michael would get the house. A: That's right. Yeah. Q: And so Dennis wouldn't get the house. A: That's right. Q: And the apartment that you were referring to was an apartment which Joanie had been planning to buy for Michael before she became sick. A: That's right. Q: So she, when she found out she was sick, she cancelled the purchase of the apartment and then made those arrangements to ensure that Michael would get the house. A: Yeah. Q: All right. And in terms of the business, did she discuss with you how she had gone about ensuring that the kids would get the business and Dennis would not get a share of it? A: Dennis wasn't brought up in it. It was that the kids and Art's brother got the - got the business, which I fully agreed with because they had worked it for the past 25, 30 years. Q: Mr. Westenberg, I am not asking about the reasons why. A: Oh. Q: I'm asking about the how it was done and I want to - my question is, did Joan tell you what she had done in order to ensure that the business went to the kids and Billy, and Dennis didn't get a share of it? A: I couldn't tell you. Q: All right. A: You are ... Q: She didn't mention having set up a trust. Or did she? A: I think she

- I think she - she told me that her lawyer was looking after that, that it was - that it was all complete, that she had it looked after. Q: Right. And when she - A: I don't think that we went into minor details of it, but as far as I was concerned, I knew that Kevin Moore was looking after it and I knew that, as far as I was concerned, it was all fixed up. I don't know. Q: Well, and it was all fixed up so that the kids - the kids would get the business and Dennis wouldn't have a share of it; is that right? A: I guess so, yeah. Q: And that's what you and Joan were talking about. A: Yeah. [169] Those answers were somewhat at odds with Mr. Westenberg's evidence to the effect that Dennis had not been mentioned at all in his discussions with Joan. In re‑examination, Mr. Westenberg was asked questions aimed at clarifying his evidence on this key point: Q: Mr. Westenberg, when [plaintiff's counsel] was questioning you, you mentioned that you had a concern, I think you said in the back of your mind, about Dennis Mawdsley making a claim against the company. A: Yeah. Q: Did - did Joanie every mention a similar concern to you? A: No. Q: And - A: It was just a - goes into a person's mind that which way the things go. Q: And when you were answering [plaintiff's counsel] questions, and you spoke about the steps that Joanie was taking for her estate planning. Right? Remember that? A:

Yeah. Q: And did she, when she was telling you about those steps, ever mention Dennis? A: No. Q: And did she ever tell you that she was taking those steps so that he wouldn't get any share of her estate? A: No. That wasn't brought up. [170] Although Mr. Westenberg and his wife could be said to be indirectly financially interested in the outcome of this litigation insofar as they continue to reside on the East 11th Lots now owned by the Meshen children, I nevertheless found Mr. Westenberg to be an honest and forthright witness. He gave no impression of attempting to misstate his testimony to give advantage to the Meshen children. [171] In assessing Mr. Westenberg's evidence as a whole, I conclude that his testimony in re-examination clarified his evidence about any statements that Joan may have made to him concerning her intended effect on Dennis in implementing the transactions under attack. On balance, I find that his testimony does not reliably support a finding that Joan communicated to him that she was undertaking such transactions with the intention of sheltering her assets from a WVA or other claim by Dennis. [172] I regret to say that I did not find Mr. Westenberg's wife, Gladys, to be credible. Although she had been a longstanding friend of Joan's, she repeatedly gave implausible evidence about her understanding of the relationship between Joan and Dennis over the 18

year period they lived together. She characterized them as companions and friends, and would not agree that they were a couple. Nor would she agree that Joan and Dennis had been in a marriage-like relationship, a fact which has been admitted by the defendants and to which her husband readily agreed. For example, she claimed that it was not until Joan got ill that she understood that their relationship was not platonic, and that Dennis had been "staying in her home". When asked whether she knew that Joan and Dennis were living together as husband and wife for a period of some 18 years, Mrs. Westenberg paused for a noticeably long time before giving this incredible reply: A: No, it was never said to me as such, "we are living together". Q: Well, you knew that Dennis was living in the Keith Street house with Joanie? A: Yeah, but he could have been anywhere in the Keith Street house. I mean not necessarily in her abode, that's what I'm trying to get at. I didn't see it so I don't know. Q: Right. You were weren't aware that Joanie and Dennis were sharing the same bed? In the same room? A: No, I didn't go to bed with them. I didn't - I was never there at night when they went into bed or anything ... [173] It seems to me that Mrs. Westenberg feigned her lack of understanding of Joan and Dennis's true relationship. That irreparably tainted her credibility and I give her evidence on

matters of relevance no weight. Joan's Death Joan died at home on June 17, 2006. Joan's Safety Deposit Boxes [174] A few days after Joan's death, Shirley and Dennis went to the bank together and opened the two safety deposit boxes at the TD bank which held Joan's rainy day cash. They agreed to leave a small portion of cash, approximately $10,000, in each box and removed the rest, intending to consolidate the funds into a single larger box. Locating a larger box proved challenging, and Shirley retained the cash at home pending those arrangements being made. It was Dennis who finally found a suitable box at a bank in downtown Vancouver. He and Shirley arranged to meet there to deposit the funds into the new box. [175] In order to understand what next occurred, it is important to know that Joan and Dennis had helped Joan's elderly Uncle Len over the years and, according to Dennis, had "saved him from dying a couple of times". It is not disputed that when Shirley and Dennis met at the bank to deposit the rainy day cash into the newly acquired box, Dennis removed the sum of between $3,500 and $4,000 with Shirley's concurrence. This sum was meant to represent one-half of a small inheritance that Joan had received years earlier from her Uncle Len. I accept Shirley's explanation that her mother had instructed her to allow Dennis to have one-half of that inheritance after her

death. [176] Shirley and Dennis had lunch together after leaving the bank that day. I accept Shirley's testimony that during lunch Dennis relayed that he thought it would be unwise to give Michael and Harry a lump sum of the rainy day fund at that time. [177] Evidently, no record was kept with respect to the amount of cash sitting in the safety deposit boxes while Joan was alive, and no one counted it when Shirley and Dennis initially removed it from the jointly held boxes or when it was placed into the new box. [178] At some later point, Shirley withdrew the money from the large safety deposit box and, as I understand it, put it in a safety deposit box registered in her name at a credit union in White Rock. It was not until roughly six to eight months after Joan's death that Shirley tallied up the cash and took photographs of it. By her tabulation, the aggregate sum was $178,560, excluding the $4,000 sum taken by Dennis with her approval. It was not clear whether this figure includes the monies initially left in the TD safety deposit boxes.

DISCUSSION Dennis's Credibility [179] The paramount issue in this case is whether one or more of the transactions impugned by Dennis, which denuded Joan's estate and thereby effectively neutralized his WVA claim, can be set aside as fraudulent conveyances. Resolving that question necessarily involves consideration of several overlapping contentious sub-issues such as: (i) whether Joan and Dennis had an agreement relative to the treatment of their respective assets; (ii) the extent of Dennis's contributions, if any, to the Meshen family business; (iii) whether Joan promised Dennis the Keith Street Property or an interest in it; and (iv) Joan's state of mind at the time that she carried out the pre-death dispositions under attack. [180] Dennis's credibility is obviously central to these determinations. [181] Among the allegations made by Dennis in this lawsuit are that Joan's children and Bill unduly influenced her to carry out the impugned dispositions on her deathbed against her will, and that she lacked the requisite mental capacity to appreciate, much less validly implement, any of those dispositions. At the start of trial Dennis assured the Court that these allegations were "live issues". [182] No cogent evidence whatsoever was adduced in support of Dennis's claim that Joan had been unduly influenced in executing the transactions he impugns. An uncontested no-evidence motion

was brought by the defence at the close of Dennis's case and was granted. [183] In support of Dennis's affiliated claim that Joan did not have the baseline capacity required to instruct Mr. Moore in relation to the impugned transactions, he says that he detected some negative effect on Joan's mental capacity as early as January or February 2006. According to Dennis, by March 22 Joan was not capable of understanding the contents of the documents prepared by Mr. Moore. He similarly testified that by the end of April 2006, Joan was incapable of engaging in any sort of meaningful conversation and would have been incapable of talking to Mr. Moore about her relationship with Dennis or her estate planning wishes generally. Dennis claims that as bad as Joan's mental condition was at that time, it continued to worsen throughout the last six weeks of her life such that any reasonable person who visited her in that final period would have seen that she lacked all capacity to think and communicate effectively. [184] This is a convenient place to note parenthetically that Dennis's testimony about Joan's alleged compromised mental capacity significantly undermines the thrust of his allegation that on March 22, 2006 she formed the deliberate intention to reposition her assets in order to place them beyond Dennis's reach. [185] Remarkably, Dennis did not raise his alleged observations about

Joan's deteriorating mental condition with Mr. Moore. He chose not to say anything about her severe mental incompetence as he guided Mr. Moore to Joan's room for the meeting on April 27 or during Mr. Moore's attendances on May 12 or May 29. Yet, those are the dates that Dennis described Joan as being "completely out of it" and "totally out of it mentally". Indeed, throughout the material period before Joan's death, Dennis did not mention the declining mental incapacity he professes to have perceived to any of Joan's children or her family doctor, Dr. Birch, who was in regular attendance. [186] In cross-examination, Dennis attempted to explain why he remained mute. He stated that he understood from Shirley that Mr. Moore was attending the home to have Joan sign some kind of tax rebate forms, and did not appreciate that Mr. Moore was seeing Joan to conduct other legal business. He also testified that he thought Mr. Moore, being a professional, was better able to assess Joan's competence than was he and therefore left it to him. The first explanation challenges belief, and the second rings as hollow. [187] Moreover, Dennis's evidence about Joan's inferior mental state was at odds with the evidence of his own witnesses, Ms. Mathieson and his niece, Janet Seline. It was also inconsistent with Mr. Moore's credible testimony and was convincingly refuted by several independent defence

witnesses, including Mr. Westenberg, Joan's closest long-time friend, Nicki Rothwell, and Shirley's then romantic partner, Christie Dougan. [188] Dennis's claim that Joan lacked the requisite mental capacity to carry out the impugned dispositions was ultimately dismissed by consent at the close of the evidence. [189] The making and pursuit well into the trial of these odious assertions on the patently flimsy evidence offered by the very person who claimed to see Joan for all but an hour or so most days throughout her confinement, has given me grave pause about Dennis's credibility. My concern is compounded by the glaring lack of specificity in many of Dennis's answers on controversial points about which he ought to have been able to provide considerable detail, and the impression he left with the Court that he was tailoring the truth to bolster his legal position. While I am not prepared to reject his testimony on all contentious matters across the board, I have concluded that it would be unsafe to accept Dennis's evidence on any pivotal factual issue in dispute where it is not corroborated by independent evidence which I find to be credible and reliable. Dennis's Involvement in the Meshen Family Business [190] Dennis claims that he made meaningful contributions to the management and daily operation of the Meshen family business. The Meshen children balk at that assertion and

say that this participation in the business was minimal at best. [191] In describing his contributions, Dennis testified that he did the "odd thing" for the business. He claims that in the busy season in particular, he would either drive to the Bog early in the morning before Joan awakened to collect cheques and papers and bring them home for Joan to deal with, or would drive Joan there later in the morning. Dennis says that upon returning home, he and Joan would usually go out to breakfast together and then he would often drive her to the bank to make the business deposit and, after she had rented the safety deposit box, to place her rainy day cash into the box. Dennis agreed that it "took a little longer" at the bank because Joan loved to spend time chatting with the tellers. According to Dennis, until 1999 he performed this task about three times per week, stating that it would generally take between 1 to 1½ hours each time. He testified that in those years he would also visit his aging mother and run errands for her a few times each week. After his mother passed away in 1999, Dennis claims that he increased the frequency of his attendances at the Bog to four to five times per week in the high season, and something less in the shoulder season. [192] Shirley testified that she normally saw Dennis at the Bog "a couple of times a week" and that her mother attended significantly

more often than did he. Harry's evidence was that Dennis came to the Bog two or three times per week, though likely more often during the busy season. [193] Susan Bell was Shirley's spouse between 1988 and 2000. During that time, Ms. Bell worked at the Bog answering telephones and processing phone orders. Her recollection is that Joan attended the Bog at least twice as often as Dennis in the busy season. [194] Ms. Dougan, who was Shirley's partner from 2000 until after Joan's death, worked at the Bog during their first four years together. According to her, Joan came to the Bog most days to collect the cheques and cash and that the majority of the time she came alone, with Dennis accompanying her on occasion. [195] Like Shirley and others, Bill credibly testified that Joan was at the Bog significantly more often than was Dennis. Bill agreed that Dennis assisted Joan in dealing with the business paperwork from time to time. He recalled hearing Joan remark that Dennis had helped her do "this or that". However, Bill did not know any specifics or the extent of how Dennis was helping in relation to the business. [196] The evidence establishes that upon the introduction of the GST, Dennis played a small role in relation to the preparation of the quarterly GST remittances for the business. Initially and spanning a number of years, Shirley and Dennis completed those remittances

together. Later, Shirley kept a hand in by supplying Dennis with an inventory of the items purchased and listing the GST paid and received. Dennis's job was straightforward: to add up the figures given to him and calculate the difference between the GST received and the GST payable, and then fill out the tax form. It was neither a demanding nor time consuming task. I am satisfied that there was a standing offer from the company accountant, Mr. Border, to prepare those remittances at a maximum cost of $150.00 each quarter. [197] None of the Meshens nor Dennis could be described as visionary entrepreneurs. Nor were they particularly sophisticated in business or in matters of finance, although Dennis had a slightly greater appreciation of investments. Dennis testified that Joan regularly looked to him for advice about the operation and direction of the business, and with respect to her personal investments. He recalled an incident early in their relationship which he maintains helped define his role as an advisor of sorts to Joan. It occurred while the couple was meeting with a representative at Joan's bank in order to review the performance of her term deposits and Dennis asked questions about the low rate of interest being paid. At the time, Joan did not take kindly to what she perceived was his meddling, and harshly "shushed" him. Dennis says that afterwards he warned Joan not

to speak to him in that way ever again. I find that despite Joan's initial rebuke, Dennis's intervention resulted in her obtaining a superior interest rate, and from that point forward, Joan invited him to attend many of her other investment and business-related meetings. I am satisfied that, with Joan's approval, Dennis posed questions and spoke his mind at those meetings. However, I also take from this incident and the evidence as a whole that Joan regarded matters touching on her finances to be her private business, and that while she was open to Dennis's input, she did not necessarily solicit or follow it. [198] Joan was not a mere figurehead of the family business. She was the CEO and had the final say on all significant business decisions. I am satisfied that Dennis periodically acted as a useful sounding board for her on business matters as they arose. However, the balance of the evidence indicates that while Joan would listen to what Dennis had to say about the business, she did not seek out his point of view exclusively, nor include him in all decisions of importance or invariably follow his advice. Nor did she consider Dennis's comments to be more valuable than the input Shirley and Bill regularly offered. I find that Joan was more interested in the views of Shirley and Bill because, as far as she was concerned and as she made known among her friends and bank and

professional advisors, the family business belonged to Joan, her children and Bill. [199] Indeed, the evidence shows that Joan did not always tolerate Dennis voicing his views about the business. Shirley, Bill and Ms. Dougan testified about an occurrence at a Burnaby council meeting in or around 2000 which they say exemplified Joan's sometimes dismissive demeanour towards Dennis when it came to the operation of the business. The meeting concerned rezoning of the Meadow Avenue Property. At the end of the meeting, the Meshen business was being discussed among the family, and Dennis chimed in with some innocuous comment. It is not contradicted that Joan scolded Dennis and snapped at him that the discussion was none of his business and to "shut up". Dennis was offended by Joan's public reprimand, and once again retreated to his West Vancouver condominium for a day or two. I accept that this incident happened in the manner described by Shirley, Bill and Ms. Dougan, and that it was not an exceptional episode. I find that there were additional instances where Joan would admonish Dennis to "keep his nose out" of the family business. [200] In assessing the totality of the evidence, it is my view that Dennis materially overstated both the degree of difficulty and the amount of time he invested in carrying out the simple GST tabulations. I conclude that he spent no more than 10 hours per

year, and probably less, performing it. I also conclude that he exaggerated the frequency of his attendances at the Bog. I find that when Dennis did accompany Joan there, he spent most of his time talking to the employees and customers to bide his time as he waited on Joan while she discussed matters with Shirley and others and gathered her paperwork. I similarly find that Dennis overstated the importance of his role as Joan's so-called personal and business confidante and magnified the frequency, nature and significance of the contributions he made to the Meshen family business generally. Claim under the FCA [201] Because assets which do not form part of a deceased's estate at the time of death are not governed by a will and are therefore not subject to an order under the WVA, a wide array of inter vivos dispositions can effectively deny relief under that statute. In contrast to dependents' relief legislation in other Canadian jurisdictions, the WVA does not contain anti-avoidance mechanisms. As there are no means within the WVA to prevent the rights of a claimant from being deliberately defeated by pre-death arrangements of assets, it falls to see whether such dispositions can be set aside as fraudulent conveyances. [202] The FCA provides, in its entirety, as follows: Fraudulent conveyance to avoid debt or duty of others 1 If made to delay, hinder or defraud creditors and

others of their just and lawful remedies (a) a disposition of property, by writing or otherwise, (b) a bond, (c) a proceeding, or (d) an order is void and of no effect against a person or the person's assignee or personal representative whose rights and obligations by collusion, guile, malice or fraud are or might be disturbed, hindered, delayed or defrauded, despite a pretence or other matter to the contrary. Application of Act 2 This Act does not apply to a disposition of property for good consideration and in good faith lawfully transferred to a person who, at the time of the transfer, has no notice or knowledge of collusion or fraud. [203] In order to set aside any of the challenged dispositions as a fraudulent conveyance, Dennis must establish: (1) his standing as "creditor or other"; (2) Joan made the disposition in question with the intent to delay, hinder or defraud him; and (3) he has been deprived of his just and lawful remedies. [204] As remedial legislation, the FCA is to be given a fair, large and liberal interpretation that best obtains its objectives: Abakhan & Associates Inc. v. Braydon Investments Ltd., 2009 BCCA 521, 283 B.C.A.C. 12, leave to appeal ref'd [2010] S.C.C.A. No. 26 [Abakhan]. In Abakhan, the Court of Appeal recently affirmed the proposition that "creditors and others" refers to both present and future creditors. [205] There is authority of this

Court that may be read as supporting Dennis's asserted standing as an "other" on the grounds that Joan's dispositions have effectively deprived him of his remedy under the WVA: Hossay v. Newman (1998), 22 E.T.R. (2d) 150 (B.C.S.C.); Mordo v. Nitting, 2006 BCSC 1761. These cases indicate that the existence of a legal or equitable claim against Joan during her lifetime is an essential threshold to Dennis establishing standing under the FCA. [206] A compatible body of jurisprudence has recognized the standing of a spouse to set aside transfers intended to defeat his or her right to matrimonial assets under the Family Relations Act, RSBC 1996, c. 128, whether or not a triggering event has occurred: Jack v. Parkinson (1994), B.C.A.C. 314, [1994] B.C.J. No. 1066, 91 B.C.L.R. (2d) 96 (C.A.) [Jack]; Chan v. Chan, [1993] B.C.J. No. 442 (S.C.); Valaire v. Valaire, [1999] B.C.J. No. 399 (S.C.). [207] The issue of whether Dennis has the requisite standing to invoke the FCA to nullify the impugned dispositions on the footing that they have impoverished Joan's estate and thereby deprived him of a WVA claim, is complex and nuanced. In my view, the application of the above cases does not necessarily assure Dennis's standing under the FCA as an "other" who has been deprived of a post-death remedy. [208] However, the determination of Dennis's standing is not necessary in this case. This is

because, for the reasons that follow, I have concluded that the preponderance of the evidence shows that Joan did not possess the fraudulent intent of the kind required under the FCA when she carried out the impugned dispositions. For the limited purpose of the following discussion relative to Joan's intent, it will be assumed that the effect of the dispositions under attack was to defeat Dennis's lawful remedy under the WVA, and that he is therefore qualified to bring a claim under the FCA. [209] The appellate court in Abakhan endorsed the principle that for the purposes of the FCA, it is no longer necessary to show a dishonest or morally blameworthy intent on the part of the transferor. With regard to the element of intent, all that is required to avoid a transaction under the FCA is an intention to place the assets out of the reach of a creditor or other: Abakhan, para. 73. [210] An individual may transfer a single piece of property or undertake a series of dispositive transactions for several reasons. A conveyance that is made with the intent of insulating assets from a creditor's grasp will not be excused where there also exists a lawful or bona fide concurrent intention. The latter intent does not serve to untaint the former. This is so even where the impermissible intention is subordinate to the bona fide rationale underlying the transfer: Abakhan, paras. 85‑86. [211]

Intention is a state of mind and is a question of fact to be ascertained based on the whole of the evidence of each particular case. Accordingly, whether a conveyance has been made with the required fraudulent intent will turn on the facts unique to each case. The precedential value of the large volume of case law is therefore limited. Authorities can be as readily found upholding transfers between a parent and children as they can setting them aside. The Court will examine the circumstances existing at the time the disposition was made as well as subsequent events that have a bearing on the question of intention at that time. At the same time, however, the law has long recognized that there may not be direct evidence of intention, and that fraud and concealment often march hand-in-hand. The courts have therefore identified certain circumstantial hallmarks, deemed suspicious, which may support an inference of fraudulent intent. In Dexia Credit Local v. Rogan, 2008 BCSC 1406 [Dexia], at paras. 23‑24, Walker J. recites these so-called badges of fraud which the courts have traditionally resorted to in determining whether a transfer is fraudulent. The list is not closed: [23] It is a question of fact, for the court to determine, whether the disposition was made with an intention to defeat, hinder, delay, or prejudice creditors. In Banton v. Westcoast Landfill Diversion Corp., 2004

BCCA 293 Braidwood J.A., writing for the court, cited at para. 5 a number of factual indicia of fraudulent intention or "badges of fraud" from Frimer v. Lurcher, [1984] B.C.J. No. 728 (S.C.): (1) The state of the debtor's financial affairs at the time of the transaction, including his income, assets and debts; (2) The relationship between the parties to the transfer; (3) The effect of the disposition on the assets of the debtor, i.e. whether the transfer effectively divests the debtor of a substantial portion or all of his assets; (4) Evidence of haste in making the disposition; (5) The timing of the transfer relative to notice of the debts or claims against the debtor; (6) Whether the transferee gave valuable consideration for the transfer. [24] There are other indicia or badges of fraud that include continuing to remain in possession following a conveyance and secrecy respecting the transactions. [212] There is authority for the proposition that where the condemned transaction was made for no consideration, there is a legal presumption of fraudulent intent. Early authorities evidently went so far as to hold that in those circumstances, the presumption was not rebuttable. The better and modern view of the Canadian jurisprudence is that the presumption is rebuttable and therefore will yield to credible evidence that demonstrates the transferor did not dispose of the asset in

furtherance of an improper purpose: see, for example, Jack. The authorities further hold that where a disposition is made between near relatives, especially spouses, in suspicious circumstances, the burden shifts to the transferor to show that the transaction was bona fide: Koop v. Smith (1915), 51 S.C.R. 554; Jennings v. Chow, 2008 BCSC 110; CIBC Mortgage Corp. v. Pender, [1999] B.C.J. No. 2162 (S.C.); Dexia; Antrobus v. Antrobus, 2009 BCSC 1341 [Antrobus]. [213] Dennis asserts that several badges of fraud are present in the case at hand. In this regard, he cites that the dispositions were made to non-arm's length persons for no consideration, and were concealed from him and made in relative haste with the effect of divesting Joan of nearly all of her assets. The Meshen children deny the existence of any actual fraudulent intent on their mother's part in relation to the transactions condemned by Dennis, and contend that Dennis's eyes were at all times wide open in relation to those transactions. In this connection, they assert that their mother and Dennis had an explicit agreement to keep their day-to-day expenses and finances as well as their respective assets separate from one another. Dennis adamantly denies the existence of any financial agreement along the lines asserted by the Meshen children or otherwise. Additionally, and as has been mentioned, he asserts that Joan

promised that she would leave him the Keith Street Property or at least the entitlement to live in it, and insists that he expected that she would leave him "something". The Meshen children counter that it was Art's desire that his son Michael would own the Keith Street Property. They say that their mother always intended to fulfill Art's wishes and that Dennis was aware of her intention. [214] Whether Joan genuinely believed that she and Dennis had an agreement concerning their respective assets, or whether they had such an agreement in fact, as well as whether she made any promise or representation to Dennis relative to the Keith Street Property, are relevant to the ascertainment of Joan's state of mind at the time that she carried out the impugned dispositions. Financial Arrangements [215] Shirley lived with her mother and Dennis at the Keith Street Property during the workweek, returning to her own home on the weekends, from 1994 until 2000. I accept that during those years Shirley was able to make important first-hand observations about the couple's financial affairs. She testified that, with few exceptions, her mother and Dennis handled their finances and investments independently from one another. According to Shirley, they shared their common daily expenses and maintained an envelope, which they called the "pot", into which they each routinely deposited the sum of $100.

Dennis and Joan would then draw on those funds as they liked to cover mutual expenses, such as going out to breakfast. They replenished the pot equally as required. Dennis testified that he and Joan each purchased certain things for their household and spent "willy-nilly", which I take to mean when and as they liked, and not necessarily equally. [216] The evidence establishes that, as a couple, Dennis and Joan enjoyed a diverse and active social and recreational life. They regularly attended hockey games using season tickets purchased by one of the companies and musical concerts. They played cards at local casinos, went dancing and took vacations together. Joan and Dennis also shared a passion for horseracing and attended the races regularly. Over the years, they each contributed money - for the most part evenly - toward the purchase of racehorses, which they acquired both with and without other financial partners. This endeavour was purely for entertainment and was generally a money-loser. From time to time, one or the other of the companies would pay some of Joan's personal expenses, such as family dinners and vehicle repairs. I am satisfied that the companies also periodically covered the repair costs of Dennis's vehicle and his gas which, despite his evidence to the contrary, I find he did not repay. [217] It is not disputed that throughout the course of their relationship,

Joan paid the property taxes and utilities for the Keith Street Property. She also purchased the plants and gardening supplies for the yard. Dennis continued to pay the utilities and property taxes in respect of his condominium in West Vancouver until he sold it in 2003. They ordinarily shared the cost of food and their cleaning lady. They also contributed equally toward the purchase of a Cadillac in 1989. When the Cadillac was sold some ten years later, they divided the proceeds equally. [218] Except for a joint bank account used mainly for horseracing expenses, the couple maintained their own separate bank accounts. They likewise kept their investments separate, other than their Cadillac, the occasional racehorse and a few collaborative purchases of stock totalling no more than $2,000 in value. [219] I am satisfied that Dennis and Joan had an explicit arrangement that they would share the costs of their daily living expenses such as groceries, meals and entertainment, more or less evenly, and that their own personal expenses and the costs related to the maintenance of their assets would be borne by them individually. Throughout their relationship they comported themselves in accordance with that arrangement with few deviations. To the extent that there was any unevenness in their respective contributions to their living, social and recreational expenses, I conclude that it

was Joan, both personally and through her companies, who made the greater financial contribution overall. [220] In terms of Joan's arrangement with Dennis concerning their assets, Shirley testified that her mother described her arrangement with Dennis in these terms: "What is mine is mine, and what is his is his". Shirley recalled a specific instance where she had confided to her mother that she had paid a financial settlement of approximately $55,000 to a former common-law spouse. Shirley claims that during the ensuing discussion, she asked her mother whether she had given any thought to "Dennis doing anything". According to Shirley, her mother replied that Dennis would not "be a problem" because they had an agreement to the effect that "what is mine is mine, and what is his is his", and assured Shirley that Dennis was an honourable man who would stand by their agreement. Shirley also recollected that once during a general discussion, Dennis told her, "I don't need your mother's money, I have my own money" or words along those lines. [221] Shirley's testimony that Dennis and her mother had a specific agreement to the effect that "what was Joan's was Joan's, and what was Dennis's was his" was supported by Ms. Dougan and Mrs. Rothwell. [222] Ms. Dougan testified that it was understood in the Meshen family and was a topic "around the kitchen conversation" that Dennis and Joan had

an agreement that his assets were his and her assets were hers. She said that reference to this arrangement came up many times over the years. Ms. Dougan also testified that during those conversations, Dennis himself effectively made the same statements in her presence and in that context described himself as an "honourable man". Ms. Dougan says that in light of that backdrop, when she learned that Dennis had launched this law suit, she was so shocked she "could have fallen over backwards". [223] Mrs. Rothwell testified that several years ago, when she and her partner and Joan and Dennis had dinner together, Joan stated in Dennis's presence words to the effect, "we don't need each other's money, we have an agreement". [224] Harry was aware that his mother and Dennis each contributed toward the cost of groceries and spent their own money to gamble at the casino. However, he did not know how they handled any other expenses or their assets. At one point in direct examination, Harry stated that he never heard his mother or Dennis speak about any financial arrangement they might have. He later appeared to contradict himself by testifying that his mother told him that her financial arrangement with Dennis was that "my money is mine, and Dennis's money is his". Harry's testimony on that point was not only was inconsistent with his earlier evidence at trial, it also contradicted the

evidence he gave at discovery where he had testified that he had no knowledge about the couple's financial arrangements. Harry was not able to satisfactorily explain his inconsistency. Consequently, I have not taken into account his evidence bearing on the issue of whether Joan and Dennis had an agreement regarding their assets. [225] Michael had no knowledge of any financial arrangements between his mother and Dennis. [226] Shirley could have chosen to embellish or exaggerate her testimony about one or more of the controversial factual issues, including her understanding of her mother's agreement with Dennis to keep their property separate, but I find that she did not do so. Her testimony was consistently forthright and balanced and she struck me as a believable and reliable witness overall. Ms. Dougan and Mrs. Rothwell were also credible witnesses, and their testimony on this crucial matter was not assailed in cross-examination. [227] In my view, Joan's own conduct as well as that of Dennis speaks to the existence of an agreement to keep their assets separate from one another. The vast bulk of Joan's wealth was tied to her interests in the family companies and was otherwise derived from those sources. The evidence overwhelming demonstrates that over the years, Joan openly and matter-of-factly told her various advisors that the entirety of her interest in the family business

would eventually belong to her children and Bill who had toiled away for modest salaries for the majority of their lives. That was always Joan's plan and it was never concealed from Dennis or in any way misrepresented to him. He knew full well of Joan's overt intention that her children and Bill would take all of the benefit of the companies started by Art, and that Dennis would not partake in any way. Joan structured the provisions of her 2000 Will on that basis and the planning recommendations of her advisors were all formulated on that premise. I infer that Joan appointed Dennis as a co-executor of her 2000 Will believing, on the strength of their asset agreement, that he would have no difficulty distributing her entire estate to her children and Bill, to his exclusion. [228] That Dennis did not name Joan as a beneficiary under any of his wills or share with her any fruits of the sale proceeds of his West Vancouver condominium is also consistent with the existence of an agreement between them along the lines described by Shirley and others. [229] Joan reposed great confidence in Mr. Moore and would have appreciated that her discussions with him were confidential. She would have had no reason to misrepresent to him the state of affairs between herself and Dennis, specifically that they had agreed that their assets were to remain their separate property. There would have been

no reason for Joan to be so dismissive of Mr. Moore's advice concerning Dennis's entitlement to pursue a WVA claim unless she genuinely believed that there was no such risk. The fact that Joan made the statement to Mr. Moore that she and Dennis had such an agreement is, of itself, powerful evidence that such an agreement existed. Although, strictly speaking, it is unnecessary in my view to go this far, I am satisfied that the twin criteria of reliability and necessity are met in this case in relation to Joan's statement to Mr. Moore concerning the agreement and that her statement is therefore admissible for the truth of its contents under the principled approach to hearsay: R. v. Khelawon, 2006 SCC 57, [2006] 2 S.C.R.

787. Keith Street Property [230] Ms. Seline met Joan in the 1980s and saw her at family functions over the years. She recalls that many times during the 1990s, Joan adamantly expressed her desire that Dennis sell his West Vancouver condominium, although she did not elaborate as to why. [231] Rosa Gordon is Dennis's niece by marriage. She enjoyed a close relationship with Joan, whom she referred to as "Aunt Joan" and they were in regular communication. Her evidence supported that of Ms. Seline. Irene Randolph, a cousin to Dennis's late wife, Pearl, likewise gave evidence that Joan repeatedly told her that she wanted Dennis to sell his condominium because he had a place to live at her house. [232] Dennis's sister, Mrs. Mathieson, also had a longstanding friendship with Joan, who often referred to Ms. Mathieson as her sister-in-law. They spoke over the telephone several times per week for more than two decades. Ms. Mathieson testified that Joan made it known that she did not like the fact that Dennis retained his West Vancouver condominium because if they had a disagreement, he would take refuge there. She recalled instances when Joan asked her to drive past the condominium and see whether Dennis was there. [233] Like Joan, Ms. Mathieson was involved in a second relationship. Her second husband had sold his home. Ms. Mathieson recalls discussing with Joan where her second husband

would live if Ms. Mathieson predeceased him. Ms. Mathieson says she told Joan that she was confident that her children would permit her second husband to reside in her home until his death. This led the two women to discuss the living arrangements for Dennis in the event of Joan's death. According to Ms. Mathieson, Joan stated more than once that Dennis did not have to worry in that regard because her house was "as much his as hers". Ms. Mathieson did not recall ever hearing Joan mention that she planned to leave the Keith Street Property to Michael, and maintained that Joan had only ever stated that Dennis would be living in the Keith Street Property for as long as he liked. [234] Mrs. Rothwell agreed that it irked Joan when Dennis retreated to his West Vancouver condominium. However, Joan did not tell her that the Keith Street Property was as much Dennis's as it was hers, or words to that general effect. Quite the contrary, Mrs. Rothwell clearly recalled that starting shortly after Art's death in 1983, Joan declared repeatedly that Michael was to receive the Keith Street Property. According to Mrs. Rothwell, Joan expressed this intention "all of the time" and "quite a bit", including during the final weeks of her life. [235] Mr. Border testified that the topic of Michael receiving the Keith Street Property was raised numerous times. He specifically recalled Joan telling him

that she wanted Michael to have the Keith Street Property as part of his share of her estate. I accept Mr. Border's evidence that during the meeting with Jim Wong in 2000 to discuss Joan's tax and estate planning issues, Joan stated that her estate was to be divided among her three children, with a portion passing to Bill, and that the Keith Street Property was to form part of Michael's inheritance. Dennis was present and Mr. Border does not recall that he objected to or commented in any way in relation to Joan's remarks. [236] At some unspecified point before the Meadow Avenue Property sold in 2005, Joan told Ms. Lyster at the bank that Michael lived in a trailer at the Bog, which would disappear upon the sale of the property. Joan also told her that the Keith Street Property would belong to Michael, explaining that it had been his father's and that Harry and Shirley each owned their own homes. [237] Michael testified that five or seven years ago, he and his mother were shopping and she rather spontaneously brought up that she was leaving him the Keith Street Property, and that it had been set up in her will. He thanked her and told her that he loved her. Michael testified that around the time that his mother received the diagnosis of terminal cancer, Shirley told him that "the house is yours" in the presence of her. He said that he was already aware of that because of his

earlier discussion with his mother. Michael testified that he first learned that the Keith Street Property had been transferred into joint tenancy after his mother died. As mentioned previously, he had signed a related deed of gift on May 17, 2006. He explained that he did not read that document and at the time did not appreciate what it was about. Despite Michael's acknowledged challenges with memory and other afflictions, I found that he testified with care and honesty. In my assessment, his evidence on this matter is reliable. [238] According to Shirley, her mother repeatedly told her that the Keith Street Property would belong to Michael. Not surprisingly, she was not clear on the dates, but credibly testified that her mother stated her intention many times over the years including during the final months of her life. [239] Mr. Westenberg testified that both before and after her illness, Joan told him that Art had always wanted Michael to receive the Keith Street Property and that she planned to fulfill Art's wishes. During one of their final private discussions, Joan said that she had put the Keith Street Property into Michael's name and was either getting rid of or had gotten rid of the MacPherson Condominium. [240] The only witness besides Dennis who claims to have heard Joan portray the Keith Street Property as being as much Dennis's as Joan's, was Dennis's sister, Ms.

Mathieson. The evidence of Mrs. Randolph and the other witnesses called by Dennis did not go that far. It is to be noted that Ms. Mathieson is the primary beneficiary under Dennis's will and, in that respect, theoretically stands to benefit from his success in this lawsuit. [241] In the face of the overwhelming persuasive evidence from the defence witnesses who have no financial interest in the outcome of this case to the effect that Joan was unwaveringly clear that Michael would own the Keith Street Property upon her death, I prefer their collective evidence over Ms. Mathieson's on this contentious point. I also accept the testimony of Shirley and Michael on this pivotal issue. [242] Dennis urged that Joan had represented or promised him an interest of some kind in the Keith Street Property to entice him to sell his condominium. However, it would seem that the last time he sought refuge at the condominium - the action that bothered Joan so much - occurred at least three to four years before he sold his condominium. Dennis's counsel suggested that Joan may have offered these promises as a means of deceitfully manipulating Dennis without telling others. His counsel alluded to the fact that Joan had been less than forthcoming from an income tax standpoint in relation to her rainy day fund and hinted at a propensity of dishonesty in order to have her way. I do not accept that

characterization of Joan. She was an outspoken woman who told it like it was, frequently hurting and offending people, including Dennis, along the way. It was not her style to cater her statements to others. Moreover, she acted with honour and integrity in upholding her word given to Bill decades ago that he would share in a distribution of the family business and by allowing the Westenbergs to continue living at the East 11th Lots. [243] Joan had given financial assistance in the past to Harry and Shirley to help them acquire their own homes. Favouring Michael with the Keith Street Property was reflected in the provisions of the 2000 Will and was Joan's intention both before and after that time. She knew that Michael was more vulnerable than her other children. Upon the sale of the Meadow Avenue Property, Michael was going to have to leave his modest living quarters on the Bog. Looking out for his well-being, Joan purchased the MacPherson Condominium in her name for Michael to live in. In my view, that purchase does not contradict her long-term intention that the Keith Street Property would belong to Michael on her death. The plan to purchase that condominium was carried out before Joan had any inkling of her precarious health condition; she had no reason to think that she would be vacating her home any time soon. [244] There can be no question that it displeased Joan when

Dennis withdrew to his condominium after a spat. She complained to others about it and wished that Dennis would not do so. However, the evidence does not go so far as to support Dennis's assertion that Joan made any promises or representations to him that the Keith Street Property would be tantamount to his own property in the sense that he did or would have an ownership interest in it or some other enforceable legal or equitable entitlement. The extent of the evidence is that as far as Joan was concerned, while she was residing at the Keith Street Property, Dennis was permitted to live there as well with unfettered access as though it were his own home, and she assured him and others of only that. [245] As much as Joan was determined to preserve the Meshen family business for her children and Bill, she was equally resolute that the Keith Street Property would belong to Michael when she died. Dennis was fully aware of this reality and Joan did not promise or represent otherwise to him. His decision to sell his West Vancouver condominium was unconnected to any pressure allegedly brought to bear by Joan, or any promise or representation made by her. Conclusions Regarding Financial Arrangements and Keith Street Property [246] The preponderance of the evidence satisfies me that from the outset of their relationship and continuing until Joan's death, she and Dennis had an explicit

agreement that, apart from the mingling of their funds to cover modest shared expenses and the occasional joint investment, they would keep their respective assets separate and apart from each other. More particularly, I conclude that the nature of their agreement was that they were each able to deal with their own assets as they liked and without restraint, and that their assets would remain free from any kind of claim by the other. I conclude further that their agreement included their express understanding that the Meshen family business would belong to Joan's children and Bill when Joan retired from it or on her death, and that the Keith Street Property in its entirety would belong to Michael when she died. Joan's Intention [247] I will now address the matter of Joan's intention in relation to the dispositions attacked by Dennis. [248] Joan's instructions to Mr. Moore to move forward with an inter vivos trust for the benefit of the children and Bill - and excluding Dennis - did not spring up suddenly. The concept had been recommended and explained by Mr. Wong in Dennis's presence as far back as 2000. Once the deal with Antham was achieved and additional sophisticated advisors were brought into the mix, the prospect of using an inter vivos trust was revived and discussed in numerous meetings. [249] I find that Dennis attended as many of those meetings as he cared to, and was

present during several where the use of the inter vivos was explained in detail and discussed without constraint. All of those discussions were based on the fundamental understanding that the Meshen children and Bill would be the ultimate recipients of the companies, including any capital dividend payment Joan received from it or other mode of distribution of the sale proceeds of the Meadow Avenue Property transaction. I find further that these discussions were not limited to the disposition of the capital dividend payments or the three companies; the concept of Joan leaving no assets in her estate so as to eliminate the incidence of probate fees was also candidly explored as was Michael's receipt of the Keith Street Property. [250] There is no evidence to suggest that Dennis raised an objection or indicated disapproval or that he took offence in relation to Joan's obvious intended treatment of her assets, either during meetings with the advisors or to Joan privately. To my mind, he conducted himself as one who fully understood that he had no entitlement to those assets. The probabilities of the situation indicate that Dennis was on‑side with Joan's plan to settle her business assets into an inter vivos trust, which reflected their agreement that they were each free to deal with their respective assets as they saw fit. [251] Joan had been made aware of Dennis's right to try to

challenge her will by Ms. Wallick several months before she became ill or met with Mr. Moore on March 22. The evidence demonstrates that long before the March 22 meeting, Joan understood that there were several advantages, including protection against a WVA claim by Dennis, in settling an inter vivos trust and disposing of the balance of her assets prior to her death. However, it does not necessarily follow that she implemented those transactions intending to delay, defraud or hinder Dennis's claim for relief under the WVA or on some other basis. [252] There is no cogent evidence to show that, upon learning of Dennis's potential WVA entitlement from Ms. Wallick, or that point was resurrected by Mr. Moore on March 22, Joan sought advice about the strategies available to her to minimize or negate such a claim. Rather, she assured Ms. Wallick that Dennis "would not go there". Similarly, the thrust of her explanation to Mr. Moore was that the agreement she and Dennis had would preclude such action on his part. Her seemingly carefree response to Mr. Moore's advice was grounded in the reality that she and Dennis had an agreement to keep their assets separate and apart for all purposes. I find that Joan was confident that Dennis would honour their bargain, and had not the slightest worry that he might challenge it. [253] In his closing argument, Dennis's counsel submitted that Mr.

Moore conceded in cross-examination that on March 22, Joan, having been made aware that an inter vivos trust could avoid a WVA claim against her estate, decided to proceed with the trust, in part, to shield against such a claim. [254] That submission materially overstates Mr. Moore's evidence. Although he did agree that during his meeting with Joan he advised her about Dennis's right to bring a WVA claim, he rejected the proposition repeatedly put to him to the effect that one of the reasons Joan instructed him to move forward with the inter vivos trust and other impugned transactions was to place her assets beyond Dennis's grasp. [255] Mr. Weiland's memorandum contained much food for thought and time was of the essence. I infer that paragraph 8 was akin to an introductory recital to which Messrs. Moore and Macaulay paid little attention, as distinct from a point of significance requiring their confirmation or clarification. I conclude that it was Mr. Moore's stated concern relative to Dennis bringing a WVA claim which is the genesis of Mr. Weiland's notation that one of the reasons that Joan proposed to settle the trust was to reduce exposure of her estate to potential WVA claims. The objective of shielding against a WVA claim that Mr. Weiland imputed to Joan in his memorandum amounts to nothing more than his articulation of Mr. Moore's concern as it was relayed to him through

Mr. Macaulay. Joan had never communicated with Mr. Weiland and was not the source of that information. [256] Mr. Moore testified that it was he who was worried about exposing Joan's estate to a WVA claim by Dennis because the agreement between them was not in writing. He persuasively insisted that insulating her assets from a claim by Dennis was "absolutely not" Joan's plan or her intention. The evidence indicates that Joan did not share Mr. Moore's apprehension of Dennis bringing a claim against her assets. The state of Mr. Moore's mind cannot legitimately be attributed to Joan; they were not parallel and are not interchangeable. [257] On the preponderance of the evidence, the WVA planning rationale which Mr. Weiland recorded in his memorandum as belonging to Joan cannot legitimately be attributed to her and I find that such motivation is not an accurate portrayal of Joan's intention in any event. [258] Dennis asserts that after Joan received her terminal diagnosis, many of the meetings with Mr. Moore were deliberately concealed from him. He recalled "muffled phone calls" around the house and gave evidence about an unnamed friend having told him there had been a secret meeting at Mr. Moore's office. Dennis also gave uncorroborated evidence that Michael and possibly Harry had said that there had been a "secret" meeting. [259] All of Mr. Moore's meetings with Joan that took

place within the relevant time frame occurred at the Keith Street Property. By Dennis's own evidence, he was present on a number of occasions when Mr. Moore attended. I do not accept his testimony that, as far as he knew, Mr. Moore's attendances on Joan throughout March, April and May were in order for her to sign "tax rebates". While I accept that Dennis was not at home when Mr. Moore met with Joan on March 22, I find he was well aware that Mr. Moore was coming on that occasion to transact legal business beyond dealing with "tax rebates". Dennis's absence that day was purely coincidental. [260] I accept that Joan did not reveal to Dennis any details of the instructions she gave to Mr. Moore or the transactions she had decided to implement. Dennis claims that her silence is evidence of a conspiracy on the part of Joan, her children, Bill and possibly even Mr. Moore, to withhold vital information and perpetuate the fraudulent conveyances. I do not agree. [261] The transactions that Joan and Mr. Moore discussed during this period and that Joan undertook were, by and large, the same as those that had been explored previously with various advisors in Dennis's presence and with his full understanding. I find that due to the agreement between Joan and Dennis to keep their assets separate and apart and because of her deteriorating health, Joan did not consider it necessary to apprise

Dennis or consult with him about the details of her final estate planning decisions. For the same reason, Dennis did not bother to pry. [262] When Joan met with Mr. Moore on March 22, her personal circumstances had fundamentally changed. She was now facing imminent death and any perceived luxury of time to cogitate on the structure of her future asset and tax planning had all but disappeared. Joan knew that her life was quickly slipping away and it was time to get her final estate plan in order. She decided to execute a comprehensive estate plan comprising several transactions recommended to her by several of her advisors over a significant span of time. [263] In my view, the evidence amply demonstrates that the threat of a WVA or other claim by Dennis against one or more of Joan's assets did not inform or in any way influence her decision to implement the Joan Meshen Trust or her treatment of her remaining assets. In the end, I conclude that Joan did not possess the intention required under the FCA to void any one or more of the dispositions condemned by Dennis in this proceeding. Accordingly, his claim founded on the FCA is dismissed. Unjust Enrichment/Constructive Trust Claims [264] Dennis's claim under the FCA that he qualifies as an "other" was grounded in part on his contention that he has a legal claim against the corporate defendants and Joan's estate based on the

doctrine of unjust enrichment. His pleadings also assert an independent unjust enrichment claim, quite apart from his claim under the FCA, stemming from his alleged assistance in the operation of Meadowland, Western and Big Bend, without remuneration. This aspect of Dennis's unjust enrichment plea is expressed in the following way in paragraphs 26, 27and 28 of his statement of claim (amended, in part, at trial): 26. Commencing in 1988 and continuing until Joan Meshen's death, the Plaintiff worked with Joan Meshen and helped her run the businesses of [Western, Meadowland and Big Bend] for no remuneration based on Joan Meshen's statement to him that he would be looked after financially. Neither Joan Meshen nor [Western, Meadowland or Big Bend] have compensated the Plaintiff for the eighteen (18) years of work which he provided for their benefit as aforesaid.

27. By reason thereof, the Estate of Joan Meshen or, alternatively, the Defendants [Western, Meadowland and Big Bend], have been unjustly enriched and the Plaintiff has been correspondingly deprived, all without juristic reason.

28. Further, or in the alternative, by reason of Joan Meshen's repeated statements to the Plaintiff that the Keith Street House would always be his home both before and after her death, and the Plaintiff working with Joan Meshen as referred to in paragraph 26 above in reliance upon such statements, title to the Keith Street House became subject to a trust whereby Joan Meshen held her beneficial interest in the Keith Street House in trust for the Plaintiff, pursuant to an express, resulting or a constructive trust. [265] Unjust enrichment is an equitable concept developed under the broad umbrella of good conscience and fairness; restitution is at its root. The doctrine has three features which I will describe in relation to the case at hand: (1) an enrichment to Joan; (2) a corresponding deprivation suffered by Dennis; and (3) no juristic reason for Joan's enrichment. [266] The leading case on unjust enrichment in the context of a common law relationship is the Supreme Court of Canada decision of Peter v. Beblow, [1993] 1 S.C.R. 980, 101 D.L.R. (4th) 621 [Peter]. Peter clarified that a valid claim for unjust enrichment could be advanced where the claimant had not made a direct financial contribution to the property. In so doing, Peter extended the legal framework to encompass indirect contributions such as domestic services as compensable contributions. In Antrobus L. Smith J.

observed that the performance of unpaid work in the home may enrich others and may amount to a deprivation to the worker (para. 198). However, Dennis did not plead that Joan was unjustly enriched by any contributions he may have made of a domestic or household nature or in relation to the maintenance, preservation or improvement, if any, to the Keith Street Property. His allegations are confined to the benefits that he claims he conferred on the corporate defendants and Joan by way of his assistance and contributions to the Meshen family business. [267] The case at hand was heard before the release of the recent decision of the Court of Appeal in Wilson v. Fotsch, 2010 BCCA 226 [Wilson]. While under reserve, counsel were permitted to make additional submissions in relation to subsequent decided case law and did so; however, no party sought to do so with respect to Wilson. [268] In Wilson, the primary legal issue before the Court was the proper treatment of the benefits received by a plaintiff in the unjust enrichment analysis, where the parties have lived in a marriage-like relationship. In addressing that issue, Huddart J.A., speaking for the majority, made important clarifying comments about several facets of the analytical approach to be undertaken in claims of that kind. [269] Her Ladyship noted that the benefit must be defined at the outset because it informs each stage of

the analysis. She observed that in light of the wide scope of the meaning of benefit, and the notion of mutuality infused in marriage-like relationships, something of value will usually have been received and retained by both parties. This is so even where the parties have carefully limited their contributions to joint expenses. The identification and definition of the corresponding detriment is also essential. [270] Referencing the Supreme Court of Canada decisions in Pettkus v. Becker, [1980] 2 S.C.R. 834, and Peter, Huddart J.A. further stated that if a spousal-defendant is found to have been enriched, it would be unusual to find that a claimant has not suffered a deprivation so long as there is a causal link between the benefit and deprivation. [271] As stated in Peter and endorsed in Wilson, the Court is to take a "straightforward economic approach" to the first two elements: Wilson at para.

12. Non-economic considerations belong at the juristic reason stage: Peter at 990; Garland v. Consumers' Gas Co., 2004 SCC 25, [2004] 1 S.C.R. 629 [Garland] at para. 31. [272] If it is determined that the defendant has a juristic reason for the enrichment, then the enrichment cannot be said to be unjust. In Garland, the Supreme Court of Canada held that there are two steps to the inquiry of lack of juristic reason. At the first stage, the claimant must show that there is no juristic reason that would deny recovery within recognized legal categories, such as the existence of a contract, donative intent or any obligation under statute, in equity or at common law. If the claimant establishes that no juristic reason exists under any such category, a prima facie case of unjust enrichment is made out. The Court will then move to the second step, where the defendant has the onus to rebut the prima facie unjust enrichment on the basis that there is some other valid reason to deny recovery. It is at this second step that the parties' reasonable expectations and public policy matters are taken into account. [273] In Wilson, Huddart J.A. cautioned that accounting for any reciprocal exchange of benefits as between the parties in the benefit analysis or in the deprivation stage is inappropriate. She noted that the Court may consider those reciprocal benefits in determining the absence of a juristic reason, but only for "the limited purpose of assessing the parties' legitimate expectations": Wilson at para.

9. The reciprocal contributions themselves do not amount to a juristic reason for a defendant to retain the enrichment: Wilson at paras. 28‑29. [274] At para. 35 of Wilson, Huddart J.A. explores more fully the assessment of the parties' expectations at step two of the juristic reason inquiry: On an inquiry into the reasonable or legitimate expectations of parties in a marriage-like relationship, there are neither presumptions nor a default position. Although it is unlikely the absence of a legitimate expectation of a share in the value created during a relationship would be sufficient reason to deny recovery, regard must be had to the evidence of the nature of the particular relationship. The proper approach is to find the parties' expectations from the evidence of their particular relationship and evaluate this aspect of the juristic reason analysis in light of those findings. Reciprocal benefits may be relevant to that analysis, but they cannot be decisive. The questions at this step are those set down by Dickson J. (as he was then) in Pettkus at 848-49 and discussed in Bruyninckx at para. 86: Did the plaintiff suffer prejudice in the expectation of an interest in property or a monetary reward? Did the defendant accept the benefit in circumstances where its retention would be unfair given his or her knowledge of that expectation? [275] Dennis's alleged contributions were

broken down into the following basic areas: (1) his trips to the Bog; (2) his work on GST returns; (3) acting as counsel to Joan in relation to her running the business and her investments; and (4) accompanying Joan on her trips to the bank. [276] Based on the evidence already canvassed, I conclude that the contributions that Dennis professes to have conferred were minimal and, to some extent, even trivial. By either characterization, they do not attain the low threshold sufficient to qualify as a benefit under the doctrine. [277] Even if Dennis were to succeed in proving an enrichment and corresponding deprivation, in my view his claim would nonetheless fail at the second step of the juristic reason analysis, where the reasonable expectations of the parties come into play. [278] In Ladouceur v. Kenchenten, 2010 BCSC 761, Macaulay J. (at para. 172) noted that the fact that the parties may not have expected to share in each other's assets does not preclude an expectation to receive compensation upon the end of the relationship. I have found that Dennis and Joan had an agreement that they would keep their respective assets separate for all purposes. Implicit in their agreement is that Dennis had no expectation to share in the Meshen family business or Joan's other assets, including the Keith Street Property. Dennis fully understood that Joan always intended that the Meshen family

business represented by the three companies would belong to her children and Bill, that Michael would receive the Keith Street Property and the balance of her assets would pass to her children. He did not quarrel with or object to Joan's overtly discussed plans in that regard. Moreover, in weighing the benefits that flowed to Dennis from the companies, including covering some of his expenses such as gas and vehicle repairs, and contributing to the cost of his recreational enjoyment such as hockey tickets, I conclude that those benefits were superior in value and kind than those he may have conferred. [279] In assessing the material considerations in the context of Joan and Dennis's particular relationship and agreement, I conclude that Dennis had no legitimate expectation of acquiring an interest in the Meshen family business, the Keith Street Property or any other of Joan's assets during Joan's lifetime or upon her death, or of receiving compensation in exchange for his inconsiderable contributions. [280] Dennis's independent claim founded on the doctrine of unjust enrichment and for which he seeks the imposition of a remedial constructive trust against the estate, the corporate shares or the Keith Street Property, or alternatively damages, is dismissed. His companion claim for damages calculated on the basis of quantum meruit in relation to his contributions to the family

business was poorly developed on both the evidence and in argument. It is also dismissed. [281] Dennis's related plea that the Keith Street Property is subject to an express trust declared by Joan must likewise fail in light of my findings concerning Joan's actual intention respecting that property and the absence of any promise or representation made to Dennis regarding his entitlement to it. Joan clearly had no intention of creating an express trust over the Keith Street Property in favour of Dennis. The absence of her intention is fatal to such a claim because it is one of the constituent certainties required to validly create an express trust: Donovan W.M. Waters, ed. Waters' Law of Trusts in Canada, 3rd ed. (Toronto: Thomson Canada Limited, 2005), at p.

132. Accordingly, that claim is also dismissed. Resulting Trust Claim of Joint Assets [282] As an alternative to his claim of fraudulent conveyance, Dennis asserts that: (i) the contents of the jointly held safety deposit boxes and all or an undivided one-half interest in the Joint Bank Accounts; and (ii) beneficial title to all or an undivided one-half interest in the Keith Street Property, reverts to Joan's estate pursuant to a resulting trust. Legal Framework [283] Broadly speaking, where an individual gratuitously transfers assets into joint names with another or into another's name alone, it is presumed that the recipient, who has given no value for the asset, holds the property in trust for the transferor: Waters at p.

362. In such a scenario, the property is said to "result" or go back to the transferor; hence the term "resulting trust". [284] The presumption of resulting trust finds its roots in the principle that equity assumes that parties make bargains rather than gifts: Waters at p. 363. [285] Traditionally, a gift from a father to his child or from a husband to his wife was exempted from the application of the trust presumption. Rather than presuming the existence of a trust, the opposite presumption, namely that of a gift of the beneficial interest in the asset, arose between those individuals. This was known as the presumption of advancement. With the introduction of modern matrimonial property legislation, the presumption of advancement (i.e. gift) was abolished in several provinces, although not in British Columbia. [286] The leading authority on the application of these opposing presumptions in relation to jointly held assets are the decisions of the Supreme Court of Canada in Pecore v. Pecore, 2007 SCC 17, [2007] 1 S.C.R. 795 [Pecore] and the companion case of Madsen Estate v. Saylor, 2007 SCC 18, [2007] 1 S.C.R. 838 [Madsen]. Both cases involved a gratuitous transfer by a father of assets into joint accounts with a daughter. Rothstein J. wrote for the majority in both. However, in Pecore he presents the more detailed discussion about the application of the presumptions in

determining the nature of the interest held by the surviving daughter on the death of the father. [287] In Pecore, the Court modernized the presumption of advancement in that it confirmed that it applied to transfers by mothers as well as fathers. At the same time however, it also limited the scope of the presumption of advancement holding that it ought not to apply where the recipient child is an adult, even where the child is economically dependent on the transferor parent. Consequently, a gratuitous transfer from a parent to an adult child is presumed to move the legal title in the asset only and not the beneficial interest, thereby invoking the presumption of resulting trust. The onus of rebutting the trust presumption falls to the recipient-child. [288] Pecore clarified that the standard of proof required to rebut either presumption is the balance of probabilities, resolving earlier debates about a differing standard depending on which presumption was sought to be rebutted. It further favoured a relaxation of the rule in Shephard v. Cartwright, [1955] A.C. 431 (H.L.) that confined the ambit of admissible evidence of intention to the transferor's acts and declarations before or at the time of or immediately after the disposition. On this point, Rothstein J. stated that evidence of intention that arises after the transfer may be considered if it is relevant to the

transferor's intention at the time the transfer is made. At para. 59, he directs: "The trial judge must assess the reliability of this evidence and determine what weight it should be given, guarding against evidence that is self-serving or that tends to reflect a change in intention." [289] The Court in Pecore also expanded the types of evidence properly available to the court in ascertaining the transferor's intention. He identified a list of five types of evidence relevant to the consideration: (i) evidence of intention that arises subsequent to the transfer; (ii) the document used to set up the joint account; (iii) the control and use of the funds in the account; (iv) whether a power of attorney had been granted to the transferee; and (v) the manner in which the transferor has treated the asset in question for tax purposes after its conversion into a joint tenancy ownership. Rothstein J. was careful to say that he was not enumerating an exhaustive list and that none of these types of evidence are determinative. [290] In addressing the circumstance where the transferor has intended to make a gift of a joint asset, the Pecore Court reasoned that the transferor may intend one of two things. He or she may intend that the transferee should immediately have the full legal and beneficial title to the asset which would permit the transferee to withdraw and spend the asset right away

for his or her own purposes. The other contemplated situation and a controversial aspect of the Pecore decision, was the concept that the transferor may intend to retain control of the joint asset until death, but give the beneficial title in the balance remaining in the account, the so-called right of survivorship, upon death. Joint Safety Deposit Boxes [291] Joan was the exclusive source of the funds placed into the safety deposit boxes. Shirley made no contribution to those funds and gave no consideration for her mother arranging for her to become a joint owner. [292] Joan did not execute a deed of gift evidencing her intention one way or the other with respect to her jointly held safety deposit boxes. I suspect this was due to the fact that Mr. Moore did not know of their existence. [293] Shirley admitted that her mother kept possession and control of the keys for the safety deposit boxes. She agreed that she would not have removed any funds without her mother's explicit permission and instructions, and that her mother had never given her such permission. Similarly, in the few instances where Shirley accessed the safety deposit boxes, she had done so on her mother's express direction to deposit an envelope containing no-receipt money. At all times Joan regarded and treated the contents of the jointly held boxes as her exclusive property: and Shirley did likewise. [294] The

evidence indicates that the understanding of both Shirley and Joan was that, in the absence of express instructions from her mother, Shirley would only have authority to deal with the contents of the boxes if Joan died. In that event, Joan did not intend that Shirley would have true beneficial ownership of the funds; they were not intended to be Shirley's own property. [295] In considering the principles at play in the circumstances at hand, I find that Joan intended that her daughter's name be added as a joint tenant to her safety deposit boxes purely for administrative convenience, and that at no time did Joan genuinely intend to pass equitable ownership of the contents of the boxes or to gift the right of survivorship to Shirley. For the sake of completeness, I find as well that although Shirley had a general inkling of what she might do with the funds upon her mother's death, for example pay the sum of $3,500-$4,000 to Dennis on account of the Uncle Len inheritance, at no time did Joan declare or intend to create an express trust of any kind over the contents of the safety deposit boxes. [296] The defendants have failed to rebut the presumption of resulting trust relative to the contents of the safety deposit boxes. Consequently, all monies in those boxes at the time of Joan's death, including the sum removed by Dennis, plus interest thereon, are held by Shirley on a

resulting trust for Joan's estate. Joint Bank Accounts [297] Joan signed a deed of gift by which she purported to transfer to Shirley by way of gift "an undivided one-half interest" in the funds on deposit held in the Joint Bank Accounts. On its face, the deed of gift gives Shirley a one-half interest only in these the funds. The deed was not made contemporaneously with the actual transfer of the Joint Bank Accounts into joint tenancy which happened on March 3, 2006. It is dated March 29, 2006; however, based on Mr. Moore's time records, it was likely not signed until May 12, 2006. [298] I consider the effect of the deed of gift to be equivocal. In my view, at least two interpretations flow from it. On the one hand, it could be read as confirming that only the legal title to those accounts was transferred into the joint names of Shirley and Joan on March 3, and that Joan retained ownership of the entire beneficial interest which she then later purported to give to Shirley via the subsequent deed of gift. In this sense, the deed represents evidence of subsequent conduct that appears to reflect a change of Joan's intention as it was when the jointure was created on March 3, 2006. On the other hand, based on the explicit language used in the deed, to the extent that Joan intended to give Shirley beneficial ownership to the funds or give her the right of survivorship of them, she

did so with respect to an undivided one-half interest only. Although the deed can be read to capture an intention to make a true gift to Shirley to that limited extent, in my assessment, imputing such an intention to Joan is inconsistent with the evidence including Shirley's own testimony about her understanding of the nature of her interest in the account funds. [299] It is to be recalled that Shirley agreed to become a joint tenant with respect to the funds on deposit in the Joint Bank Accounts, whereas she had refused to do so with respect to her mother's large term deposit. I infer that her lack of hesitancy in becoming a joint tenant of the Joint Bank Accounts as distinct from the term deposit account holding the large capital dividend payments, simply reflected that she was not troubled by the prospect of the former funds falling into her estate after her mother died because the overall sums were so very small compared to the term deposit that she refused to hold jointly. I do not take it as evidence that supports the assertion that Joan intended to make a true gift to Shirley of the funds or the right of survivorship in the Joint Bank Accounts. [300] Joan was the exclusive source of all funds on deposit in the Joint Bank Accounts and she maintained control of them until her death. In my view, Joan's intention in transferring the Joint Bank Accounts into joint names was

to enable Shirley to help her manage her financial affairs while Joan was alive, in the face of the physical deterioration that her terminal medical condition would soon cause. The corollary is that Joan had no intention that her daughter would have beneficial title to the monies on deposit in those accounts or to the right of survivorship. The weight of the evidence does not support a finding that the subsequent deed of gift relative to those accounts evinces an intention on Joan's part to make a true gift of any part of the deposited funds to Shirley, sufficient to rebut the presumed trust that arose on March 3. The presumption of resulting trust has not been rebutted. Another implication of my finding concerning Joan's actual intention relative to these accounts is that she did not intend to create an express trust over them in favour of Shirley or her sons. [301] Consequently, the funds on deposit in the Joint Bank Accounts at Joan's death, plus interest, form part of her estate. Keith Street Property [302] Another of Dennis's claims relative to the Keith Street Property is that Joan's gratuitous transfer of it to herself and Michael as joint tenants was ineffective to pass the equitable title to Michael and thus, is held on a resulting trust for the estate. [303] The applicable deed of gift recites that Joan wishes to transfer by way of gift "an undivided one-half interest

in the [Keith Street Property] to create a joint tenancy interest between" Joan and Michael. It goes on to state that Joan is giving an undivided one-half interest in the Keith Street Property to Michael. In contrast to the deed of gift, the freehold transfer is stated to convey the entire fee simple interest in the Keith Street Property and not just an undivided one-half interest, to Michael and Joan as joint tenants. Unlike the deed of gift purporting to cover the Joint Bank Accounts which was signed several weeks after those accounts were converted into joint tenancy, Joan executed the Keith Street Property deed of gift at the same time that she signed the freehold transfer. On their surface, the two documents appear to be incompatible. [304] The unfortunate wording contained in the deed of gift is the foundation of Dennis's alternate assertion that, at most, Joan intended to convey a one-half interest in the Keith Street Property to Michael and hence the other one-half interest belongs to her estate. To bolster his argument, Dennis contrasts the deeds of gift that Joan signed relative to the East 11th Lots and the Surrey Property in which she declares her intention to gift "absolute ownership and title" to those parcels, and does not refer to a one-half interest. An obvious prima facie distinction is that Joan's gifts of her interests in those two parcels were made outright

to her children, and not by way of jointure. [305] Counsel for Mr. Moore contends that conceptually only a one-half interest in the Keith Street Property was being retained by Joan and the other one-half interest was passing to Michael and that because the two interests are undivided, the result is a joint tenancy with right of survivorship over the entire property. The underpinnings of that argument strike me as problematic in terms of establishing the unities required to validly create a joint tenancy. [306] In any event, it is my opinion that the question of the beneficial ownership of the Keith Street Property is best resolved by assessing the evidence of Joan's actual intention in its totality. The deed of gift is but one piece of that evidence. [307] Although the deed is capable of supporting the suggestion that Joan intended to give Michael only one-half of her beneficial title to the Keith Street Property, against that I balance the overwhelming evidence that she always intended to give him the whole of that property. Prior to her death she took steps to incorporate her long-standing intention as a component of her final estate plan. According to Mr. Moore's testimony, Joan signed this deed precisely to clarify that her intention was to give Michael the entire interest in the Keith Street Property. [308] I have little difficulty in concluding that Joan signed the

freehold transfer document and the accompanying deed of gift intending to facilitate the creation of a joint tenancy with Michael of both the legal and equitable title to the Keith Street Property with the intention that, upon her death, Michael would own the legal and beneficial title to it by right of survivorship. On balance, the evidence rebuts the presumption of a trust. [309] Joan's estate has no interest in the Keith Street Property. WVA Claim [310] The heart of the WVA is found in s.

2. It provides that if, in the court's opinion, a will fails to make adequate provision for the proper maintenance and support of the testator's spouse or children, the court has the discretion to vary the will to make provision that it considers adequate, just and equitable in the circumstances. [311] The Supreme Court of Canada's decision in Tataryn v. Tataryn Estate, [1994] 2 S.C.R. 807 [Tataryn], continues to be the governing authority in British Columbia on wills variation. [312] The Tataryn Court affirmed its earlier decision in Walker v. McDermott, [1931] S.C.R. 94, which introduced the moral obligation consideration into the analysis of whether provision consistent with the WVA had been made and laid to rest any lingering legitimacy of an exclusively needs-based model. For that reason, it is crucial to approach the case authority based on whether it came before or after Tataryn. [313] In Tataryn, McLachlin J. (now the C.J.C.), writing for the Court, identified the two fundamental interests protected by the Act. The main statutory objective is the adequate, just, and equitable provision for a testator's spouse and children. The other protected interest is the testator's testamentary autonomy. The conceptual essence of the Act is to permit judicial interference of testamentary freedom where a testator's spouse or child has not been left adequate provision. Testamentary

freedom must therefore yield to the extent required to achieve adequate, just and equitable provision for the applicant spouse and/or children. In that sense and to that degree only, testamentary autonomy will be curtailed by the application of the Act. [314] The Tataryn Court held that the determination of whether adequate provision has been made and, if not, the provision to be substituted by the court to achieve an adequate, just and equitable distribution are "two sides of the same coin" (p. 814). [315] McLachlin J.'s articulation of the relevant considerations and the principles underpinning the Act has been reiterated in virtually every case decided thereafter. Her Ladyship powerfully summarized the application of the Act by observing that "the search is for contemporary justice" (p. 815). [316] The basic approach formulated in Tataryn to address the adequacy of the testamentary provision can be summarized as follows: The question of whether a testator has acted as a judicious parent or spouse in relation to the provision under the will is measured by an objective standard, assessed in light of current societal legal norms and current societal moral norms. Legal Norms Legal norms are the obligations that would be imposed upon the testator during his or her life if the question of provision for the claimant spouse or child were to arise. In the words of McLachlin J., a

testator's legal responsibilities while alive "reflect a clear and unequivocal social expectation, expressed through society's elected representatives and the judicial doctrine of its courts" (p. 821). Pursuant to Tataryn, a testator's legal obligations, had he or she not died, arising under the Family Relations Act, the Divorce Act, and the law of constructive trust are relevant factors in the assessment of the testator's legal obligations for the purposes of the Act. While McLachlin J. recognized that the legal obligations that contemporary society imposes on living testators vis-à-vis their spouses and children are not necessarily parallel to those on death, she regarded them to be an important indication of the nature of the legal duty in death (p. 822). Moral Norms McLachlin J. indicated that a testator's moral duties are found in "society's reasonable expectations of what a judicious person would do in the circumstances, by reference to contemporary community standards" (p. 821). She acknowledged that because there is no clear legal standard to assess moral duties, obligations falling under that rubric are more susceptible to being differently interpreted by different individuals (p. 822). Tataryn recognized that there is no single way for a testator to divide the estate in order to discharge the legal and moral duties. In this regard, McLachlin J. reminded that it is

only where the testator has chosen an option which falls below his or her obligation defined by reference to the contemporary sense of legal and moral norms, that a court will make an order "which achieves the justice the testator failed to achieve" (p. 824). Balancing the Claims Tataryn held that all legal and moral claims should be satisfied where the magnitude of the estate permits. If that is not possible, the court must prioritize the competing claims. Claims that would have been recognized as legal obligations during a testator's lifetime should "generally take precedence" over moral claims (p. 823). The court must also weigh the competing moral claims and rank them according to their strength. Where the estate assets permit, as part of the assessment of a testator's moral duty the court must take into account the testator's legitimate testamentary concerns for the protection of beneficiaries and future generations and the carrying out of social purposes which may go beyond providing for the surviving spouse and children (p. 823). [317] The circumstances existing at Joan's death as well as those that were reasonable foreseeable to her at that time are to be taken into consideration to determine whether she has made adequate provision. A substantial change in the circumstances of a claimant or of a beneficiary in the intervening period between the date of death and the

date of trial, may also be taken into consideration: Landy v. Landy Estate (1991), 60 B.C.L.R. (2d) 282 (C.A.); Wilson v. Lougheed, 2010 BCSC 158. There was some evidence that after Joan's death Dennis lost money in the stock market. However the amount of his loss was not quantified, and the point generally was not developed. On the evidence as it stands, that post-death circumstance would not have been within Joan's reasonable contemplation and was not shown to amount to a substantial change in Dennis's circumstances. Accordingly, it is not a proper consideration in relation to Dennis's variation claim. [318] The parties' WVA arguments were modelled on the premise that all of Joan's assets would revert to her estate and were not modified to address the prospect that only a relatively small portion of her assets would comprise her estate, and how that outcome would impact Dennis's variation claim. [319] In the year of Joan's death, Shirley's income was $62,880, consisting primarily of employment income derived from the family business. The aggregate net value of her assets is approximately $638,000, with a comparatively small debt in the order of $22,000. She has no dependents. [320] Harry's income for 2006 amounted to $62,655 and, like Shirley's, was derived mostly from his employment in the family business. He owns a house with a net equity of approximately $345,000 which, as

I read the statement of agreed facts, is to be transferred to his estranged spouse. Apart from that, Harry has $8,000 in the bank and liabilities approaching $51,000. He has four children, two of whom are adults, and the others are well into their teens. [321] In 2006, Michael's income was $52,369, largely made up of his employment earnings from the family business. He has $20,000 in the bank and term deposits and RSPs that total approximately $400,000. Michael is single and has no children. [322] Dennis is an elderly man with no serious health issues. In 2006, his income was $58,736. It consisted of $5,846 in old age security, $10,410 in CPP benefits, $14,542 in other pension income, $18,906 in workers compensation benefits, $1,986 in dividend income, $2,365 in interest income, $3,503.12 of other income, and $1,174 in taxable capital gains. [323] Dennis is a co‑owner with his two siblings of an interest in a piece of heritage property in Saskatchewan which has been in Dennis's family for many years. It consists of 160 acres of bare land, and is worth approximately $70,000. The land is rented out for farming, producing income to Dennis and each of his siblings in the amount of $1,200 per year, together with $800 annually in oil royalties. [324] Dennis has an RSP and RIF with a combined worth of approximately $64,400. He has the sum of about $95,293 invested in a GIC, and

approximately $32,200 in his various bank accounts. He also owns a vehicle that has an estimated value of $17,500. [325] For the purpose of evaluating whether Joan owed a legal duty to Dennis under the WVA, he asserts a claim based on unjust enrichment. As I have concluded that Dennis's independent claim of unjust enrichment as framed in his pleadings is without merit, it surely cannot ground a legal claim owed by Joan in the Tataryn analysis. In his testimony, Dennis also appeared to assert a claim of unjust enrichment extending beyond what is contained in his pleadings, formulated on the spousal services that he periodically provided to Joan, such as performing yard work, purchasing groceries, cooking meals and supplying nursing care in her final months. In this regard, I note as an aside that Dennis testified that in his mind the provision of these so-called spousal services was simply "part of being with Joan". Had an unjust enrichment claim not been pled specifically, it seems to me that it would be open for the Court to consider the legitimacy of such a claim being advanced on all possible bases supported by the evidence. However, where, as here, an independent claim based on the doctrine has actually been pled, it would be inappropriate for the Court to assess a claim based on an asserted enrichment and deprivation that extends outside the pleadings. In my view,

consideration of Dennis's claim in unjust enrichment and constructive trust within the Tataryn paradigm ought to be confined to his pleadings. Those claims have been dismissed. [326] Dennis also argues that, rather than her dying, had he and Joan separated in 2006, she would have been obligated to pay him spousal support. Until 2005, Joan's income was relatively modest. It jumped to a whopping $173,000 in 2005 due to the significant interest income that she received for a portion of that year on her invested capital dividends. Dennis seeks to impute a 2006 income to Joan (had she lived) in the range of $275,000 by extrapolating that investment income over a twelve-month period. He then applies the Spousal Support Advisory Guidelines to calculate a range of spousal support of between $58,392 and $77,856 annually. [327] It is unlikely that Dennis's theoretical entitlement to spousal support could be sustained on the contractual or compensable bases. It may be, however, that he has a claim based on financial need: Hodgkinson v. Hodgkinson, 2006 BCCA 158, 25 R.F.L. (6th) 235; Chutter v. Chutter, 2008 BCCA 507, 86 B.C.L.R. (4th) 233. [328] However, in my opinion, whether Joan owed Dennis a notional legal duty within the Tataryn analysis, has no practical effect. This is because in the circumstances of this case the strength of Dennis's WVA claim is firmly rooted in the moral side of

the equation. [329] It is settled that the agreement between Joan and Dennis to maintain separation of their assets free of claims by the other does not oust the Court's discretionary jurisdiction under the WVA to vary Joan's will in appropriate circumstances: Wagner v. Wagner Estate (1991), 5 B.C.A.C. 55, 62 B.C.L.R. (2d) 1 (C.A.); Steernberg v. Steernberg Estate, 2006 BCSC 1672, 28 E.T.R. (3d) 1; Bridger v. Bridger, 2005 BCSC 269, 13 E.T.R. (3d) 279, aff'd 2006 BCCA 230, 53 B.C.L.R. (4th) 235. Their agreement is a relevant consideration but is not conclusive. In my opinion, it does not negate Joan's moral duty to Dennis. [330] An obviously important factor is the size of Joan's estate. The assets comprising her estate are her rainy day fund kept in the safety deposit boxes, the funds on deposit in the Joint Bank Accounts at her death, plus interest, lot 6 of the East 11th Lots, and the contents of the Keith Street Property. Upon the filing of Joan's 2006 income tax return, the amount of $219,759.10 was due in tax. As I understand the evidence, the Meshen children have paid that liability from their own funds or the Joan Meshen Trust paid it on their behalf. It is not clear whether the children will be seeking reimbursement for those taxes from Joan's estate. It may also be that potentially adverse tax consequences attach in respect of Joan's treatment of her rainy day fund,

which could further erode her estate. Consequently, the net value of Joan's estate is not precisely known at this time. For the purpose of assessing Dennis's variation claim, I have disregarded any potential negative income tax consequences and assumed the maximum possible value. [331] Contemporary standards, modern values and expectations contemplate a wide variety of living and financial arrangements among unmarried spouses in the Canadian landscape. In the recent Court of Appeal decision of Picketts v. Hall (Estate), 2009 BCCA 329, the Court canvassed the relevant considerations in assessing the strength of a variation claim brought by a common law spouse, and particularly the moral duty owed to her. [332] Having regard to the length of their marriage-like relationship, the lack of any legal obligation owed by Joan to any of her children, the magnitude of the assets passing to the Meshen children under the Joan Meshen Trust and in consequence of the other pre-death transactions undertaken by Joan, Dennis's comparably inferior financial stature and his advanced age, I find that Joan's moral obligation to Dennis is a heavy one that overtakes any legal duty she may have owed. [333] In weighing the totality of the evidence in light of the animating legal principles, I conclude that Joan did not make adequate provision from her estate for Dennis and that her failure to leave

anything to him under the Last Will falls below the moral obligation of a contemporary judicious spouse in all of the circumstances. [334] It is incumbent on this Court to vary Joan's will only to the extent required to provide the justice to Dennis that Joan's will failed to achieve, commensurate with her moral obligations. In my opinion, Joan's Last Will is to be varied so as to give to Dennis the entire residue of her estate. For the sake of clarity, Joan's specific bequest of the contents of the Keith Street Property to Michael is not disturbed. Counterclaim of the Meshen Children [335] Since Joan's death, Dennis has continued to reside on the main floor of the Keith Street Property and Michael has remained in the basement suite. They have shared the costs of all of the expenses relative to the Keith Street Property, including property taxes. As well, there is evidence that Dennis has continued to carry out some yard work and performed minor maintenance of that property since Joan's passing. For the purposes of this proceeding, Dennis and Michael agree that from the date of Joan's death onward, the rental value of the entire Keith Street Property is $2,000 per month. [336] Although the statement of agreed facts indicates that Dennis has been asked to vacate the Keith Street Property, it was clear from Michael's evidence that it was not he who requested that Dennis do so.

Nor was Michael able to recall instructing anyone else to make the demand on his behalf. As strange as it might seem in these circumstances, I conclude that Michael has not been bothered by having Dennis occupy the main floor of the Keith Street Property, pending the outcome of this lawsuit, and has had no intention of charging rent to Dennis during that timeframe. [337] The claim for occupational rent is dismissed. However a writ of possession for the Keith Street Property in favour of Michael is granted effective September 15, 2010. Other Matters [338] As mentioned, the parties have agreed that the title to the East 11th Lots should be rectified so that lot 6 passes to the Meshen children. I am not prepared to grant such an order until I receive further submissions from the parties about their respective positions as to who will ultimately bear Joan's personal tax liability for the year of death. [339] By way of a separate memorandum to counsel, a court attendance will be arranged shortly to set the deadlines for Shirley to provide Dennis with an accounting of the funds in the safety deposit boxes and the Joint Bank Accounts, and for the Court to receive submissions on the rate of interest applicable to those funds, clarification of the position of the Meshen children relative to reimbursement for the estate's tax liability and costs. __ "Ballance J."______ The Honourable Madam Justice Ballance