Estate disputes involving substantial amounts of money or assets can quickly escalate, even when there are a small number of beneficiaries. In a recent decision from the Court of King’s Bench of Alberta, a deceased’s estate was to be divided between two beneficiaries, with one retaining the right to occupy the deceased’s home for the rest of her life. However, the two beneficiaries could not agree on the details the testator intended them to abide by and found themselves before the Court seeking clarity and direction.

This blog explores the Court’s decision and considers how the Court assesses such scenarios in an effort to interpret the language of the will and identify the testator’s intentions.

Estate Divided Between Two Beneficiaries

The two parties of the matter of Lester Estate (Re), were “ES”, a specific beneficiary under the deceased’s will and “NG”, the personal representative of the estate and the sole residuary beneficiary of the estate.

In October 2021, the Court of King’s Bench issued an order requiring that a reserve be set aside to cover the estate’s potential liabilities to ES, while allowing the rest of the estate to be distributed to NG. However, the amount needed to set aside was not clear to the parties.

Will is Ambiguous Regarding Property Maintenance

The will provided ES with the right to occupy and rent a house that belonged to the testator for $1/month for the remainder of her life. ES had lived in the house for many years and was living there at the time the testator passed away. The will also addressed the upkeep to the home, stating that the burden of repairs and upkeep would be paid by the estate.

The will indicated that ES would be responsible for certain costs, including “the first $750 in repair costs.” However, it neglected to explain whether this amount was to be applied each month or over the course of ES’ lifetime. The will also provided that ES would receive monetary assistance in the event that she ceased renting and occupying the home and elected to receive the monthly assistance payment. However, ES argued that she should be entitled to such financial assistance even while she resides at the home, as the deceased had previously provided her with monthly allowance payments.

Beneficiary Argues Property Maintenance Was a One-Time Obligation

NG’s position was that the will was clear in stating that ES had two options: to choose to remain in the home and pay $1/month in rent, or move out of the property and elect to receive monthly assistance of up to $1,200 as a matter of NG’s discretion. However, ES pointed out that the will stated “(ES) will continue to receive her current monthly monitory [sic] assistance until her death fro [sic] the assets of my estate. (NG) is instructed to make monthly bill or maintenance payments due.”

ES also took the position that the requirement for her to pay the first $750 in repair and upkeep charges was a one-time obligation that extended over her lifetime. The Court noted that the amount of money being litigated was significant. As such, if ES was entitled to $1,200 per month in addition to $1/month rent for the home, the estate would owe her more than $130,000 in arrears alone, with the possibility of more payments to come.

Determining the Intentions of the Testator

The Court, in looking at the language of the will, noted that the testator was free to express his intentions to leave a form of maintenance that was modified from any historical arrangements he had with ES. The Court found in the evidence that the testator’s payments to ES before his death were limited and did not reflect ES’ position, writing:

“That arrangement could not possibly override the clear and specific language in Mr Lester’s will which, at most, purported to make minor changes to the scope of the payments that Ms Saito claimed he made to her during his life.The meaning of (the testator’s) will is clear. He was paying current monthly monetary assistance to (ES) to cover upkeep expenses for the house and intended to continue that in a manner consistent with his understanding of their scope subject to any modifications he chose to make.”

Beneficiary Cannot Receive Both Benefits Simultaneously

Ultimately, the Court concluded that ES had the option to remain at the property during her lifetime to use and could occupy the house (for $1/month). However, if she decided to terminate her rental of the home, she would be eligible to receive a maximum of $1,200 per month. The Court held that ES could not receive both benefits at once as she did not receive both while the testator was alive.

This left the Court to determine the issue of repair payment responsibilities and what the $750 contribution by ES should be. ES argued that this was intended to be a one-time contribution, while NG said it should reset each month. Considering the language of the will, the Court ultimately agreed with NG, stating that the contribution applies to “all utilities, yard maintenance and the first $750 of any required repairs to maintain local standards in the townhouse.”

Contact the Estate Litigation Lawyers at DBH Law in Calgary for Trusted Representation in Estate and Inheritance Disputes

If you are considering estate planning, or are involved in an estate dispute over a will or trust, it is important to seek legal advice as soon as possible. At DBH Law, our experienced estate planning and litigation lawyers will help you prepare for the future and protect your interests. From preparing a will and power of attorney, to representing you over a dispute with an executor or beneficiary, our wills and estates team is ready to help. Contact us by phone at 403.252.9937 or reach out to us online to schedule a confidential consultation with a member of our team and learn how we can assist you.