When Mrs. Crumb became estranged from two of her four children, she reportedly cut them out of her Will. However, she had already designated all four of her children as beneficiaries on her registered plans, which amounted to 40% of her wealth at the time of her death.
The two children who had not been cut out of her Will argued that the general revocation clause in Mrs. Crumb’s Will revoked her registered plan designations, landing the proceeds of those plans in the estate to be divvied up as spoils between the two favoured children. It may or may not have been Mrs. Crumb’s intention to revoke her designated plans with the general revocation clause in her Will, and to cut out her two estranged children from the proceeds of those plans. If it was her intention to do so, she used a rather blunt knife to do the job.
The Ontario Court of Appeal agreed with the Court of first instance in holding that the revocation clause was not sufficient to revoke Mrs. Crumb’s registered plan designations. That is because the revocation clause did not satisfy the condition under s. 52(1) of the Succession Law Reform Act that the revocation of a registered plan must relate expressly to the designation.
The general revocation clause in Mrs. Crumb’s Will stated:
I HEREBY REVOKE all Wills and Testamentary dispositions of every nature and kind whatsoever made by me heretofore made.
While Justice Feldman, writing for the Court, found that the revocation related to the designation on account of the fact that the designation qualified as a testamentary disposition, the revocation did not relate to the designation expressly.
Had Mrs. Crumb wished to cut her two estranged children out of receiving the proceeds of her registered plans, her revocation clause would have needed to refer expressly to the designations she had previously made. Better yet, she would have been well-advised to re-designate her plans to her two favoured children, or to her estate (albeit subject to probate tax) to aid with the payments of debts, taxes and funeral and testamentary expenses, with the residue going to her two favoured children under her Will.
The wise solicitor uses a sharp knife to make a clean cut.
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This blog post was written by Dylan McGuinty, Jr., a member of the Wills and Estates and Estate Litigation teams. He can be reached at 613-369-0379 or at [email protected].
