CITATION: Francis v. Brooks, 2016 ONSC 6160

COURT FILE NO.: 05-26/16

DATE: 20160930

SUPERIOR COURT OF JUSTICE – ONTARIO (ESTATES LIST)

In the Estate of Desmond Francis, Deceased

RE: Laynor Francis, Applicant

AND:

Khalilah Brooks, Akeem Francis, Nailah Francis and Khalilah Brooks, in her capacity as Estate Trustee of the Estate of Desomond Robert Francis, Respondents

BEFORE: Penny J.

COUNSEL: Sylvia M. Samuel for the Applicant

Dion R. McClean for the Respondents

HEARD: September 21, 2016

judgment

Overview and Issues

[1] The applicant, Laynor Francis, was the spouse of the deceased for 25 years. They had two children together. During the last 11 months of his life, the deceased left his wife and lived with the respondent Khalilah Brooks. Shortly before he died, the deceased made a will naming Ms. Brooks as estate trustee and sole beneficiary of his estate. The deceased also changed various beneficiary designations on life insurance and RRSP accounts, naming Ms. Brooks as beneficiary, and opened a joint bank account with Ms. Brooks. Mr. Francis died on October 14, 2014.

[2] In this application, Ms. Francis says that the deceased failed to make adequate provision for her support. She seeks declarations that she was a dependent of the deceased at the time of his death and that she is entitled to support under Part V of the Succession Law Reform Act. She also seeks an order for payment to her of the proceeds of an RRSP account (which were paid into court by order of Glustein J.), payment of insurance proceeds paid to Ms. Brooks on Mr. Francis’s death, payment of certain amounts held in a bank account of the deceased jointly with Ms. Brooks, payment for the value of shares held by the estate in CGI Group Inc. and CPP disability benefits allegedly paid to the deceased following his death.

[3] The issues in this case are:

1. Was the applicant a dependent of the deceased?

2. Was adequate provision made for her support by the deceased?

3. What assets are available to the estate to make provision for the applicant? and

4. If an order is to be made in favour of the applicant, what provision should be made for her support?

Background

[4] This matter came before me on August 4, 2016. At that time, Ms. Francis’s application had already been adjourned twice. Mr. McClean, counsel for Ms. Brooks, had agreed to file material by certain deadlines but failed to fulfil those promises. He had no reasonable explanation for his failure to do so. I granted a further adjournment on strict terms, requiring Mr. McClean to pay personally certain costs thrown away and requiring service of Ms. Brooks’ responding material by August 16, 2016. I made the new return date, September 21, 2016, peremptory to Ms. Brooks. I further ordered that any failure to comply with these terms by Ms. Brooks would entitle the applicant to move, without notice, for default relief.

[5] Ms. Brooks did not file material by August 16 as ordered. Instead, Mr. McClean sought to pass up an affidavit of Ms. Brooks to the Court on the day of the hearing, September 21, 2016 having served it, apparently, the night before. No factum was filed on behalf of Ms. Brooks, again contrary to my August 4, 2016 order. As on August 4, 2016, Mr. McClean had no reasonable excuse for the failure to comply with the orders of the Court for the filing of Ms. Brooks’ material.

[6] Accepting the late affidavit would have deprived the applicant of the right to file responding material and to cross-examine Ms. Brooks, both of which were contemplated in my August 4 endorsement. I determined that a further adjournment would be an abuse of process, given the past delays and the clear terms my order of August 4, 2016. I therefore declined to accept the affidavit. The argument proceeded on the basis of the material filed on behalf of Ms. Francis although I heard oral submissions from Mr. McClean.

[7] The applicant and deceased were married in 1988. They had a son born in 1988 and a daughter born in 1990. In 1991, the applicant and the deceased bought a home, 24 Tamara Drive, Richmond Hill. The applicant’s sister held a 35% interest in the home.

[8] In 2012, the deceased admitted to being involved in an extramarital affair. In this same year, he was diagnosed with cancer. In July 2012 the deceased moved out of the matrimonial home but continued to visit and sometimes stay overnight. In November 2012, the deceased moved back into the matrimonial home.

[9] In 2013, the deceased wanted to sell the matrimonial home. The applicant did not. In an effort to ensure that the deceased had funds to support himself during his illness, the applicant agreed to pay the deceased $100,000 for his interest in the home. In order to raise this money, the mortgage on the home had to be refinanced.

[10] Net of liabilities, this couple’s equity in the home was $246,928 (half of which is $123,464).

[11] The re-financing was done and the applicant paid the deceased the agreed-upon $100,000 in November 2013. The deceased moved out of the matrimonial home at around the same time and, as I understand it, thereafter lived with the respondent Ms. Brooks. He died on October 14, 2014. The available records account for the disposition of significantly less than $50,000 of that $100,000, although the applicant makes no claim to that possible asset of the estate on the date of death.

[12] Shortly after Mr. Francis’ death, the applicant became aware that the deceased had made a will on August 19, 2014 naming Ms. Brooks as estate trustee and sole beneficiary of his estate.

The Assets

[13] In 1989 the applicant and the deceased purchased a Primerica life insurance policy. The evidence is that this was done to benefit each other and the children in the event that anything was to happen to them. Until March 2012, the premiums were paid from this couple’s joint account. The deceased stopped paying the premiums in March 2012. Thereafter, the applicant paid the policy premiums with her own funds to ensure that the policy did not lapse.

[14] In March 2014, the deceased told the applicant that he wanted to remove her name from the policy. She refused. The deceased said he would do it anyway. On May 21, 2014, the deceased removed the applicant as a beneficiary, replacing her with the respondent, such that the beneficiary designations were:

Deceased 25%

Son 25%

Daughter 25%

Ms. Brooks 25%.

[15] On August 19, 2014, the deceased again change the beneficiary designation to this policy as follows:

Son 37.5%

Daughter 37.5%

Ms. Brooks 25%

The evidence is that following the deceased’s death, each child received $97,500 (37.5%) and Ms. Brooks received $65,000 (25%) under the policy. The applicant asserts a dependant’s relief claim against the $65,000 paid to Ms. Brooks.

[16] The deceased also had an RRSP with Primerica. On the date of his death, that account was valued at $47,867.91. On August 19, 2014, the deceased filed a change in beneficiary designation regarding the RRSP account, replacing the applicant with Ms. Brooks as the sole beneficiary. As a result of the applicant’s dependent’s relief claim against the RRSP account, Primerica brought an interpleader application and this money has been paid into court by order of Glustein J.

[17] The deceased also held some shares in CGI Group Inc., apparently valued at approximately $9,830. There were also at least three bank accounts.

[18] In November 2012, the deceased and his son purchased a videogame express business for $40,000. This business was established as a partnership between the deceased and his son but the business was operated by and for the son, who continues to operate the business. The purchase of this business was financed using a home equity line of credit. That line of credit was paid off as part of the refinancing in 2013, the proceeds of which were used to pay the deceased $100,000 in November 2013, as noted above. Accordingly, the applicant effectively paid for this business.

[19] The deceased’s assets, and the amounts received, are summarized in the following chart:

Asset

Received or claimed by Brooks

Received by Son

Received by Daughter

Received by Me

Primerica Life Insurance Policy

$65,000

$97,500

97,500

CPP disability benefits (estimate)

$13,000

CIBC Chequing Account – joint with Khalilah Brooks

$13,221.37

CGI Group Inc. Shares

$9,830.00

National Bank RRSP

$160.43

ING Savings Account

$14.01

National Bank Contract No. 11259RG-001)

TBD

Primerica Common Sense Funds – RRSP (estimate)

$47,867.91

1994 Toyota Supra

12,000

1999 GMC Savana

$250

Interest in Video Game Express Business

TBD

Tools/Equipment Valued at Approximately $3,433

TBD

Subtotal

$149,093.72

109,500

97,500

250 (+TBD)

The Applicant’s Circumstances

[20] For approximately 20 years, until June 2015, the applicant worked as a retail sales clerk, earning, in the latter part of that career, about $48,000 annually. Since August 2015, she has provided childcare services out of her home, earning about $500 per week. She receives a Canada Pension Plan survivor’s benefit of about $448 per month. Other than the equity in her home, her assets are limited to:

RRSP at CIBC $1,219

RRSP at Quadra’s $552

Tax-free savings account at CIBC $168

[21] Apart from the mortgage on her home, the applicant has liabilities of about $11,500 in the form of Visa bills.

Analysis

[22] The SLRA provides that where a deceased fails to make provision for the proper support of any of his dependents, the court may order that such provision as it considers adequate for proper support be made out of the estate.

[23] “Dependent” is defined to include a spouse to whom the deceased was providing support or was under a legal obligation to provide support immediately before his death.

[24] I find that the applicant was a dependent within the meaning of the SLRA. The deceased was, I find, at the date of his death under a legal obligation to provide support to his spouse of 25 years. There is no evidence to establish that Ms. Brooks was a spouse or that the deceased was under an obligation to provide support for her. The only other potential dependents are the two adult children. Neither has made a claim or filed evidence in these proceedings.

[25] On the basis of the facts outlined above, I also find that, by making Ms. Brooks the sole beneficiary under his will, the deceased failed to make provision for the proper support of the applicant.

[26] In determining the amount and duration of support on an application under s. 58 of the SLRA, the court must consider all the circumstances of the applicant including:

(a) the dependant’s current assets and means; and

(b) the assets into means that the dependent is likely to have in the future;

(c) the dependent’s capacity to contribute to his or her own support;

(d) the dependent’s age and physical and mental health;

(e) the dependent’s needs, in determining which the court shall have regard to the dependent’s accustomed standard of living;

(f) the measures available for the dependent to become able to provide for his or her own support and the length of time and cost involved to enable the dependent to take those measures;

(g) the proximity and duration of the dependent’s relationship with the deceased;

(h) the contributions made by the dependent to the deceased’s welfare, including indirect and non-financial contributions;

(i) the contributions made by the dependent to the acquisition, maintenance and improvement of the deceased’s property or business;

(j) the circumstances of the deceased at the time of death;

(k) any agreement between the deceased and the dependent;

(l) any previous distribution or division of property made by the deceased in favour of the dependent by gift or agreement or under a court order;

(m) if the dependent is a spouse,

(i) the length of time the spouses cohabited,

(ii) the effect on the spouse’s earning capacity of the responsibilities assumed during cohabitation,

(iii) any housekeeping, childcare or other domestic service performed by the spouse for the family, as if the spouse had devoted the time spent in performing that service in remunerative employment and had contributed the earnings to the families support;

(iv) the effect on the spouses earnings and career development of the responsibility of caring for a child and

(n) any any other legal right of the dependent to support, other than out of public money.

[27] Section 72 of the SLRA requires that the capital value of certain transactions effected by deceased before his death are deemed to be part of the deceased’s net estate for purposes of a s. 58 application. As such, the assets from which a claim for dependents relief may be paid include the traditional estate assets plus the additional assets prescribed by s. 72 of the SLRA.

[28] In particular, the following transactions relevant to the facts of this case, must be included as part of the estate assets for the purpose of determining a dependent’s support claim:

(1) money deposited to any bank, together with interest, in an account in the name of the deceased and another person and payable on death under the terms of the deposit or by operation of law to the survivor of that person;

(2) a deposit of property made by a deceased whereby property is held at the date of death by the deceased and another as joint tenants;

(3) any amount payable under a policy of insurance effected on the life of the deceased and owned by him;

(4) any amount payable on the death of the deceased under a policy of group insurance; and

(5) any amount payable under a designation of beneficiary under Part III of the SLRA.

[29] Accordingly, insurance proceeds, joint bank accounts and amounts payable under beneficiary designations are available to and must be included in the value of the estate. Even insurance proceeds already paid out are to be included for purposes of valuing the estate, see Moores v. Hughes (1981), 1981 CanLII 1870 (ON SC), 37 O.R. (2d) 785. In this case, three assets fall into these categories:

(i) the proceeds of the life insurance policy of $260,000;

(ii) the proceeds of the RRSP of $47,867.91; and

(iii) funds on deposit in the CIBC joint checking account of $13,221.37.

[30] The applicant is of modest means. Her net assets, excluding her interest in the matrimonial home, total a little over $10,000. Her liabilities exceed this amount. She paid her husband $100,000 to acquire his interest in the matrimonial home. Given her work history and current assets, her assets and means are not likely to improve in the future. She is 55 years of age. She continues to work, but earns a modest income. She was married to the deceased for 25 years. In addition to continued emotional support during his illness, she considered the deceased’s welfare in making the $100,000 payment to him in 2013, to her detriment. It was to her detriment because, if the payment had not been made, the deceased’s interest in property would have passed to the applicant on the deceased’s death by right of survivorship. The applicant also paid the premiums on the life insurance policy jointly with the deceased from July 1989 until March 2012 and thereafter, unassisted by the deceased, paid the premiums until the deceased’s death.

[31] In my view, taking into account all of the factors under s. 62 of the SLRA, including, in particular, the duration of the applicant’s relationship with the deceased, the contributions made by the applicant to the deceased’s welfare, including indirect and non-financial contributions, the contributions made by the applicant to the acquisition, maintenance and improvement of the deceased’s property (by, for example, paying premiums on the life insurance policy), it is appropriate that a significant proportion of these assets be awarded to the applicant.

[32] I order the proceeds of the Primerica life insurance policy received by Ms. Brooks in the amount of $65,000 must be paid to the applicant.

[33] I order that half of the amount of the joint account, $6,610.69 must be paid to the applicant.

[34] I order that the shares in CGI Group Inc. are to be turned over to the applicant for her use absolutely.

[35] I order that the Primerica RRSP funds, paid into court, must be paid out to the applicant.

[36] I order that any interest held by the deceased in the video game express business vests in the applicant by way of resulting trust.

[37] The evidence does not sufficiently describe or explain the estimated $13,000 allegedly paid to Ms. Brooks by way of CPP disability benefits. The evidence, therefore, does not support any order being made in this regard and the claim concerning that amount is dismissed. The remaining assets in respect of which Ms. Francis asserts a claim are inadequately valued or described or are des minimus. The claims on these remaining assets are also dismissed.

Costs

[38] Ms. Samuel seeks on behalf of the applicant $15,180 in partial indemnity costs plus disbursements and HST, for 66 hours of preparation and attendance. Her bill of costs does not itemize the steps or specific time spent on those steps. It is unclear, among other things, whether the fees claimed reflect the $2,000 already paid by Mr. McClean for cost thrown away on August 4, 2016. In all the circumstances, I award $15,000 payable by the respondent Ms. Brooks to the applicant, inclusive of all fees disbursements and applicable taxes.

Penny J.

Date: September 30, 2016