ONTARIO
SUPERIOR COURT OF JUSTICE
LINDSAY COURT FILE NO.: 72/09
DATE: 2012-06-28
B E T W E E N:
Franz Surkau, Estate Trustee of the Estate of Christel Frohlich
Ivan Reynolds, for the Applicant
Applicant
- and -
Gabriele Wedekind, Renate Dreger, Anita Schroeder, Erna Arndt and the Public Guardian and Trustee
Susan J. Woodley, for the Respondents Gabriele Wedekind, Renate Dreger, Anita Schroeder and Erna Arndt (Although served, the Public Guardian and Trustee did not appear and took no position on this motion.)
Respondents
HEARD: June 19, 2012
Gunsolus, J.
JUDGMENT
Background
[ 1 ] The applicant is the Executor and Trustee of the Estate of Christel Frohlich (the deceased), pursuant to a Last Will and Testament of the deceased, dated November 30 th , 1987. The applicant was granted a Certificate of Appointment on or about the 25 th of October, 2007.
[ 2 ] Christel Frohlich passed away on May 1 st , 2007. She was widowed at the time of her death and had no issue.
[ 3 ] Jurgen Frohlich, who was named to receive 25% of the residue of the estate, predeceased Christel Frohlich by some 15 years. The applicant seeks directions with respect to the distribution of his lapsed 25% residuary gift, valued at somewhere between $400,000 and $500,000. Specifically, the applicant asks the court to determine whether the lapsed gift should be distributed among the deceased’s surviving named residuary beneficiaries, or among the deceased’s next of kin, all of whom were virtual strangers to the deceased and who were identified and located through the assistance of a genealogical researcher in Germany.
[ 4 ] As her husband, Hugo Frohlich, predeceased her, the Estate Trustee was directed, by Christel Frohlich’s Will, as follows:
“ALSO, in the event my said husband, HUGO FROLICH, should predecease me, I GIVE, DEVISE, BEQUEATH AND APPOINT all my estate , both real and personal, and any property over which I may have a power of appointment, including insurance, unto my executors and trustees above named for the purposes of the following:
TO CONVERT my estate into cash at such time or times and upon such terms as may appear advisable to my said executors and trustees in their absolute discretion.
TO PAY all my just debts, funeral and testamentary expenses as soon as convenient after my death.
TO PAY twenty-five per cent (25%) of the rest and residue of my estate as converted into cash to JURGEN FROHLICH.
TO PAY the sum of thirty per cent (30%) of the rest and residue of my estate as converted into cash to GABRIELE WEDEKIND.
TO PAY the sum of ten per cent (10%) of the rest and residue of my estate as converted into cash to RENATE DREGER.
TO PAY the sun of ten per cent (10%) of the rest and residue of my estate as converted into cash to ANITA SCHROEDER;
TO PAY twenty-five per cent (25%) of the rest and residue of my estate as converted into cash to ERNA ARNDT in trust for UDO FROHLICH. The said ERNA ARNDT is to have complete and absolute discretion as to the disposition of these funds and on the death of UDO FROHLICH, she is to receive what remains in her personal capacity.
[ 5 ] From the foregoing, it is understood that all beneficiaries named in the Will, were related to the Testator through her marriage to her husband, Hugo Frohlich. All the named beneficiaries were well-known to the Testator, and had a relationship with her during her lifetime. Specifically, the relationship between the residuary beneficiaries and the deceased were as follows:
a) Jurgen Frohlich (deceased) was Hugo Frohlich’s nephew (the son of Hugo’s brother, Hans);
b) Gabriele Wedekind was Hugo Frohlich’s daughter;
c) Renate Dreger was Hugo Frohlich’s niece (the daughter of Hugo’s sister, Erna Arndt);
d) Anita Schroeder was Hugo Frohlich’s niece (by marriage) and
e) Erna Arndt was Hugo Frohlich’s sister and Udo Frohlich (deceased) was Hugo Frohlich’s brother.
[ 6 ] The following persons were identified through a genealogical researcher as being possible next of kin of the Testator:
a) Renata Berta Grunwald Vogler (b. 1938);
b) Estate of Ursula Elizabeth Grunwalt Marcinkowski (b. 1928, d. 2009);
c) Margot Gertrude Otto (b. 1928) (may have predeceased – no info);
d) Irmgard Burstedde (b. 1929); and
e) Hedwig Werner (b. 1929)
[ 7 ] All of those named in paragraph 6 above were served pursuant to my order of the 9 th day of September, 2010, but filed no materials. No counsel appeared on their behalves in this matter. It would appear, therefore, that they have attorned to the jurisdiction and decision of this court.
Position of the Applicant
[ 8 ] The Applicant Estate Trustee does not take a position, but rather places these matters before this court, to obtain the advice, opinion and direction of the court.
Position of the Respondent Residuary Beneficiaries
[ 9 ] The surviving residuary beneficiaries submit that the gift to Jurgen Frohlich of 25% of the “rest and residue” of the estate should properly be distributed among the surviving residuary beneficiaries.
The Law
[ 10 ] A lapsed residuary gift passes on intestacy, unless there is a contrary intention in the Will. [1]
[ 11 ] Further, it is settled law that when a court interprets a Will, it must determine the Testator’s intention at the time that the Will was made. One must use common sense and give words their ordinary meaning, in an attempt to achieve, from the wording of the Will, the result that the Testator intended. When a Testator’s intention cannot be determined in this way, the court may resort to the use of the “armchair rule”. [2]
[ 12 ] There is nothing in the terms of the Last Will and Testament that would indicate that the Testator did not intend to dispose of her entire estate.
[ 13 ] It would also appear that the Testator had a special connection and relationship with her named residuary beneficiaries, being her nephew, step-daughter, nieces and her sister-in-law. These are persons whom she apparently shared a close relationship with. From a reading of the Will, and given the fact that the Testator named only persons with whom she had a relationship, it can be inferred that she wished only those persons named to benefit from her estate, as she did not provide for circumstances wherein one or more of the beneficiaries might predecease her. [3]
[ 14 ] I must therefore sit in the “Testator’s armchair” and consider the extent of the Testator’s assets, the size and makeup of her family, and her relationship to its members, in an attempt to give effect to the Testator’s wishes. [4]
Discussion
[ 15 ] In the case before me, it is the evidence of the Estate Trustee and his wife, who knew the deceased in excess of 40 years, that she had no living relatives with whom she maintained contact. It is also clear that the residuary beneficiaries specifically named in her Last Will and Testament maintained a special relationship with her. They were a nephew, nieces, step-daughter and sister-in-law, all related to her by marriage through her late husband.
[ 16 ] In fact, there is no evidence that the Testator knew of, let alone contemplated leaving any portion of her estate to, traceable next of kin. In fairness, while she may have at one time assumed or known of their existence, there is certainly no evidence that there was any contact between her and them for in excess of 30 years. Indeed, the Estate Trustee has confirmed in his affidavit evidence that the deceased believed she had no living relations.
[ 17 ] In reviewing the terms of the Last will and Testament, the Testator did not appear to consider or intend to have anyone, other than those specifically named therein, to benefit from her estate. It would not appear to have been her intention that any portion of her estate go to persons unknown or who she had never met, or maintained contact with, during the majority of her own lifetime.
[ 18 ] This would appear to be a reasonable assumption in that the Testator considered a new Will in 1996, after her husband passed away. In the draft of that Will, although never executed by her, she contemplated leaving her entire estate to her step-daughter, Gabriele Wedekind. This would lead one to assume she never had an intention to leave any portion of her estate to unknown heirs or to her next of kin.
[ 19 ] Further, the Testator did not provide for a gift over or alternate residuary beneficiaries. She was clear in naming specific beneficiaries and no one beyond them.
[ 20 ] When Christel Frohlich travelled to Germany for her parents’ funerals, she advised her friend, Maria Surkau, that she had not arranged for a grave marker or monument, as there was “no one to look after it”.
[ 21 ] The court finds that the intent of the deceased would have been that the lapsed gift be shared among her surviving, specifically named, residuary beneficiaries, with whom she shared a special relationship. [5]
[ 22 ] It is therefore open to the court to find that a reasonable and common-sense interpretation of the Testator’s Last Will and Testament would provide that the lapsed gift should be distributed among the named surviving residuary beneficiaries. In arriving at this conclusion, the court is mindful of the “golden rule”, applicable to the interpretation of Last Wills and Testaments, which states that where there are two interpretations which can be applied to a Will, it is the interpretation which favours testacy, rather than intestacy, that should be applied. [6]
[ 23 ] In short, I have found a contrary intention in the Will, with the assistance of evidence of her friends Franz Surkau and Maria Surkau that the Testator considered Gabriele Wedekind, Renate Dreger, Anita Schroeder and Erna Arndt to be her only remaining family, and those persons found by way of genealogical research were in fact virtual strangers to her. To that end, the lapsed residuary gift should not be distributed on intestacy but only among those named residuary beneficiaries she was close to.
Disposition
[ 24 ] The lapsed residuary gift that was bequeathed to Jurgen Frohlich is to be distributed among the surviving beneficiaries: Gabriele Wedekind, Renate Dreger, Anita Schroeder and Erna Arndt, in their proportionate shares.
[ 25 ] As to costs, the parties may submit written cost submissions of no more than 2 pages (excluding actual time dockets), by July 27, 2012.
“The Honourable Mr. Justice D. S. Gunsolus”
DATE RELEASED: June 28, 2012
[1] See: Kossak Estate v. Kosak , (1990) 72 O.R. (2d) 313 (H.C.J.); Doplihar Estate v. Stopar , (1990) 75 O.R. (2d) 374 (Gen. Div.); Reid Estate v. Chan Estate , [1996] O.J. No. 3124 (Gen. Div) ; and Mladen Estate v. McGuire , 2007 .
[2] Dobson Estate v. Dobson , [2000] O.J. No. 552 (S.C.J.), at paras 7-8 ; Matzelle Estate v. Father Bernard Prince Society of the Precious Blood , [1996] O.J. No. 5107 (Gen. Div.), at paras 17 and 21 ; Mladen Estate v. McGuire supra , at para 22 ; and Robinson Estate , 2011 ONCA 493.
[3] See Mladen Estate , supra at para 23 and 24 ; Succession Law Reform Act, R.S.O. 1990, c. S. 26, at s. 31.
[4] See Dobson Estate v. Dobson, supra , at paragraphs 7-8; Matzelle Estate v, Father Bernard Prince Society of the Precious Blood, supra , at paras 17 and 21; Mladen Estate v. McGuire , supra , at para 22 ; and Robinson Estate, supra .
[5] See Mladen Estate , supra , at para 27 ; Re: Mackie , 1986 , [1986] O.J. No. 289 (S.C.J.) at para 13 and 16 ; Campbell v. Shamata , [2002] O.J. No. 99 (S.C.J.) at para. 7 ; Robinson Estate, supra .
[6] See Reid Estate, supra; and Mladen Estate, supra.