Competing Wills Claims of Stepchildren and Long-term Second Spouse

I recently discussed the oft-seen competing wills claims of adult independent children of a first marriage and a second spouse. In that case, Eckford v. Vanderwood, 2014 BCCA 261, the court found it to be within the range of acceptable outcomes for the surviving spouse to be excluded from her husband’s will, as she had already received assets outside the estate, the marriage was short (4 years), and there were valid competing claims of adult independent children.
By way of contrast, in Picketts v. Hall, 2009 BCCA 329, a long-term common law spouse successfully applied to vary her husband’s will so that she received a lump sum payment of $5M, in addition to the family home and personal effects left to her by the will. As in Eckford, there were competing claims of adult independent children from the spouse’s first marriage, but in Picketts the size of the estate made it possible to provide bequests to all beneficiaries. The vastly different outcomes of these decisions show how important the particular facts are to a wills variation claim.

Long-term common law marriage

Mr. Hall was a wealthy businessman. He was a 75 year old widower when he began his relationship with Ms. Picketts, who was 25 years his junior. They lived together in a common law relationship for 21 years until his death at the age of 96. Despite his wealth, they lived quite frugally.

Bequest to surviving spouse of monthly payments for life

When Mr. Hall died in 2002 he left an $18M estate, the majority of which he accumulated before the relationship with Ms. Picketts began. Mr. Hall’s will, prepared ten years before his death, left Ms. Picketts the family condominium valued at $297,300, personal effects valued at $106,740, and payments from the estate of $2,000 per month for the rest of her life.

Bulk of the estate to adult independent children

The will provided that the rest of the $18M estate was to go to Mr. Hall’s sons: 40% to Maxwell (age 80 when his father died), and 60% of the estate to Brenton (age 70). Both sons were independent and financially comfortable in their own right when their father died. As executors of their father’s estate, Maxwell and Brenton agreed that the will did not make adequate provision for Ms. Picketts and voluntarily increased the monthly payments she would receive.

Spouse brought wills variation claim

Ms. Picketts brought an action to vary the will, and the trial judge ordered that she receive a substantially increased monthly payment (approximately $15,000 per month). Ms. Picketts appealed, asking for a lump sum payment from the estate. The Court of Appeal sided with Ms. Picketts and substituted the monthly payments with a lump sum of $5M in addition to the family condominium and personal effects.
A careful look at the circumstances – in particular, the size of the estate and the length of the relationship between the spouses – demonstrates why the outcome of this case was so different than in Eckford v. Vanderwood.

Legal claims of adult independent children

As the starting point in a wills variation claim, the court will look to the obligations the law would impose on a person during his or her life if the question of provision for a spouse or children were to arise – in other words, the legal obligations set out in the Divorce Act, family property law, and the law of constructive trust. These obligations guide the court in determining what is “adequate, just and equitable” in a will.
A person has a legal obligation to provide for dependent children and in some cases, there may be a legal obligation toward a grown, independent child by reason of the child’s contribution to the estate. That was not so in the Picketts case – as in Eckford v. Vanderwood, Mr. Hall did not have any legal obligation to provide for his adult, independent children in his will.

Competing moral claims of adult independent children and spouse

After considering the legal claims, the court will then turn to the will-maker’s “moral obligations” toward the spouse and children. There may be a moral obligation to provide for an adult independent child if the size of the estate and the will-maker’s other obligations allow it.
The Court of Appeal in Picketts stated that claims of adult independent children should not overshadow a will-maker’s moral duty to a spouse, especially where the marriage was a long-term one and the size of the estate makes it possible to fully address the moral obligations toward all beneficiaries. A variation of the will in favour of Ms. Picketts was possible without risking any harm to the lesser moral obligation Mr. Hall owed to his two sons.

Factors that heightened the moral obligation toward the surviving spouse

After concluding it was not appropriate in this case to prefer the moral claims of Mr. Hall’s adult independent children to those of Ms. Picketts, the Court of Appeal listed the factors that supported a strong moral obligation to provide in the will for Ms. Picketts:

1. no legal obligation of Mr. Hall to either of his sons;
2. the length of the marital relationship between Mr. Hall and Ms. Picketts – 21 years;
3. the agreement of Ms. Picketts to give up her career in the early years of their relationship, thereby depriving her of the opportunity to accumulate an estate of her own;
4. the necessity for Ms. Picketts to dip into her limited savings to supplement their living expenses when Mr. Hall was alive;
5. the lengthy period of loving and effective care Ms. Picketts provided to her spouse during his decline;
6. the promise Mr. Hall made that he would take care of Ms. Picketts as though she were his wife; and
7. the size and liquidity of the estate.

Lump sum to surviving spouse

The court could have ordered increased periodic payments to Ms. Picketts, but instead decided that a lump sum payment was the most equitable outcome. As noted above, Mr. Hall’s sizeable estate was quite liquid and thus capable of making a large lump sum payment. A lump sum may not be appropriate in a case where, for example, the bulk of the estate is a family business needing to remain intact for the benefit of future generations.
The lump sum payment had the benefit of allowing Ms. Picketts to administer her own financial affairs without being dependant on the estate. In addition, the lump sum allowed her a measure of testamentary autonomy of her own so that she could pass her own estate to whomever she wished.

Take home points

Claims of adult independent children should not overshadow a will-maker’s moral duty to a spouse, especially where the relationship was a long-term one between caring, dedicated spouses and the size of the estate makes it possible to fully address the moral obligations toward all beneficiaries.
A lump sum payment may be ordered on a wills variation claim if the size and liquidity of the estate permit it.