Navigating Testamentary Capacity
You have an elderly widowed neighbour. You know her so well that she asked you to be the executor of her will some years ago, shortly after her husband died. Recently, you have noticed a few changes in her lifestyle. She is full of excitement about a new friend she has made and the new group to which this friend introduced her. You notice that her children and grandchildren are visiting her less frequently than they used to. Finally, despite her enthusiasm for this new group, in other respects, she seems to be declining. When you visit her home, it is significantly messier than it used to, despite your experience of her as a fastidious housekeeper. When you chat over a cup of tea, she is periodically forgetful about recent matters, increasingly dwells on the past, and even inserts words from the language she used as a youth before she immigrated to Canada. You chalk it up to aging and trust that her oldest daughter, who has power of attorney, will be attending to these things.
In your most recent visit, she tells you that she is thinking of updating her will and power of attorney documents. When you ask why, she mentions the good that the organization she joined is doing and how her new friend suggested that leaving a bequest to this group would be a good way to leave a legacy. “Besides,” she says, “my kids and grandkids hardly come to see me anymore. Why should I give them anything?”
This is a fictional scenario, but it raises the subjects of elder abuse and, for this blog post, testamentary capacity. What are some of the issues one needs to be aware of and address?
What is testamentary capacity?
In the scenario above, you may be concerned that your friend is losing sufficient capacity to make a will. The term “testamentary” reminds one of the fuller expression for which “will” is shorthand, “Last Will and Testament.” Testamentary capacity, therefore, refers to the ability of someone to write a will. In general, across Canada, if you are capable of writing a will, you are encouraged to do so.
Not everyone is capable of writing a will, however. For example, minors cannot generally write a will. Since most minors have very little in the way of assets and typically do not have dependents, this does not deprive them of a right that many minors would seek to exercise. Quite the contrary, there are altogether too many adults with assets and dependents who should have wills but do not.
A Capacity Checklist
The following is drawn from a document provided by Whaley Estate Litigation Partners, a Toronto-based law firm that focuses on trusts and estates.
To show capacity, a testator, the person making the will, must have the ability to understand the following:
- The nature of the act of making a Will;
- The extent of the property of which he or she is disposing; and
- The claims of persons who would normally expect to benefit under the Will.
To break this down further:
- The nature of the act of making a Will: Does the testator understand that he or she is making a will? The person needs to know that this document is intended to address the disposition of their assets and personal affairs following their death.
- The extent of the property of which he or she is disposing: Allowing for simple forgetfulness, the testator needs to have a reasonable understanding both that he or she is arranging to distribute his or her property on death and what property is being distributed.
- The claims of persons who would normally expect to benefit under the Will: The testator must know who might have first claim on their property. For example, if married, the testator should realize that the spouse will have a claim on the estate. A will that leaves the bulk of the estate assets to charity at the expense of heirs might give rise to a question of capacity.
A fourth criterion, established in Banks v. Goodfellow, dating back to 1870, states that a person executing a will “shall possess no insane delusion that shall influence his will in disposing of his property and bring about a disposal of it which, if the mind had been sound, would not have been made.” Note that this does not necessarily mean that a person with an insane delusion is automatically determined to lack capacity. Rather, it is only a disqualifier if the delusion is likely to have had an impact on the gifts made in the will.
Alcohol and drug use as a factor in testamentary capacity
In a recent case, a man who had previously written a will made substantial changes to his wishes in a handwritten suicide note. On the day before his death, he had consumed considerable quantities of hash oil cigarettes, beer, and vodka. This new will was initially voided based on the testator’s presumed incapacity from alcohol and drug consumption. However, on appeal, the new will was allowed. The appeals court found that the new will (the suicide note) was valid in that the testator, knew he was making a will, understood the nature and extent of his property, and named the people that he might expect to benefit from his will. Expert evidence also confirmed that neither “suicide [nor] substance abuse disorders, together or in combination, were sufficient to infer a lack of testamentary capacity.” The bottom line: drug and alcohol use alone do not negate testamentary capacity.
A continuum of capacity
Some people have complex estates. Consider the owner of multiple businesses and properties along with membership in a blended family, for example. At the other end of the spectrum might be a widow with one adult child whose estate consists of little more than a Registered Retirement Income Fund and a house along with its contents. The former would have a higher bar to clear for capacity than the latter. If you are thinking of making or updating your will, or you have parents who indicate a desire to do so, consider some of the above factors that might come into play. While the estate lawyer is the first line of defence in ensuring that capacity is assessed, issues of capacity are important for anyone who might either make a will or be affected by a will.
This is the 142nd blog post for Russ Writes, first published on 2022-04-04.
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Disclaimer: This blog post is intended for general information and discussion purposes only. It should not be relied upon for investment, insurance, tax, or legal decisions.