Butler Estate, Re, (2007) 268 Nfld. & P.E.I.R. 137 (NLTD)

• Judge: Adams, J.
• Court: Supreme Court of Newfoundland and Labrador (Canada)
• Case Date: May 17, 2007
• Jurisdiction: Newfoundland and Labrador
• Citations: (2007), 268 Nfld. & P.E.I.R. 137 (NLTD)

Butler Estate, Re (2007), 268 Nfld. & P.E.I.R. 137 (NLTD);

    813 A.P.R. 137

MLB headnote and full text

Temp. Cite: [2007] Nfld. & P.E.I.R. TBEd. MY.024

In The Matter Of the Last Will and Testament and Codicil thereto of Gordon Butler, late of the City of St. John's, in the Province of Newfoundland and Labrador, Businessman, Deceased;

 

And In The Matter Of an Application to the Supreme Court of Newfoundland and Labrador, Trial Division, pursuant to Section 25 of the Trustee Act, R.S.N.L. 1990, c. T-10.

(V 18/F 1351; 2007 NLTD 105)

Indexed As: Butler Estate, Re

Newfoundland and Labrador Supreme Court

Trial Division

Adams, J.

May 17, 2007.

Summary:

Trustees of an estate applied pursuant to s. 25 of the Trustee Act seeking the court's direction respecting the management and administration of the trust, property or assets of the testator.

The Newfoundland and Labrador Supreme Court, Trial Division, determined the issues accordingly.

Devolution of Estates - Topic 425

Devolution - General - Spouses - Preferential share - Entitlement to - A couple had no children - The husband died first - Both died testate - The Newfoundland and Labrador Supreme Court, Trial Division, held that a clause in the husband's will (clause 6(3)(C)) did not create a valid testamentary charitable trust as it failed for uncertainty and vagueness of its objects - There were no words in the husband's will indicating a disposition of the proceeds of clause 6(3)(C) in the event that the intended trust failed - Therefore, the rule in Bullock v. Downes, that "the class is determined at the date of death of the testator unless a clear contrary intention appears in the will", did not apply and the 20% of the residue of the estate referred to in clause 6(3)(C) had to be distributed on an intestacy, with those entitled to be determined as of the date of death of the testator (the husband) - By virtue of s. 6 of the Intestate Succession Act, the 20% became the absolute property of the wife, upon the husband's death - It did not matter that she took no steps to claim that estate upon her late husband's death as she became the owner of it by operation of law - Alternatively, if the rule in Bullock v. Downes did apply, it would make no difference as the husband's will did not indicate that he intended to exclude his widow from benefiting from a portion of the capital of his estate - See paragraphs 67 to 85.

Trusts - Topic 372

Creation of trust - Purpose or object - Certainty of objects - Clause 6(3)(C) of a will provided that "The remaining 20 per cent of my Residuary Estate income to be donated to other worthwhile causes or divided equally among the causes listed in my will or as my Executors in their sole discretion see fit." - At issue on an application by the estate trustees was whether clause 6(3)(C) was restricted to charitable purposes - The Newfoundland and Labrador Supreme Court, Trial Division, held that a "worthwhile" cause was not necessarily also charitable, even though it might be commendable - However, even if "worthwhile" was synonymous with "charitable", clause 6(3)(C) did not even require the executors to apply the 20% to worthwhile causes - They were left with the absolute discretion to apply the 20% of income in any way they wished - Therefore, clause 6(3)(C) did not create a valid testamentary charitable trust as it failed for uncertainty and vagueness of its objects - See paragraphs 21 to 55.

Wills - Topic 7

Testamentary instruments - General principles - Severability - Clause 6(3)(C) of a will provided that "The remaining 20 per cent of my Residuary Estate income to be donated to other worthwhile causes or divided equally among the causes listed in my will or as my Executors in their sole discretion see fit." - At issue on an application by the estate trustees was whether clause 6(3)(C) was restricted to charitable purposes - The Newfoundland and Labrador Supreme Court, Trial Division, held that clause 6(3)(C) did not create a valid testamentary charitable trust as it failed for uncertainty and vagueness of its objects - See paragraphs 21 to 55 - However, clause 6(3)(c) could be quite neatly severed from the remaining 80%, thus saving that portion of the residue which was clearly charitable - See paragraphs 56 to 66.

Wills - Topic 3501

Charitable gifts - General - Clause 6(3)(A)(b) of a will provided that the income from a specific portion of the residue of the estate was to be left to "the Governing Council of the Salvation Army in Canada to be used for the purchase of equipment for the Grace General Hospital in St. John's, Newfoundland, or for such other purposes in connection with the said Hospital as the said Governing Council and my Executors may decide" - Clause 7(3) provided that notwithstanding anything else in the Will, the Grace General Hospital, like the other hospitals named in clause 6(3)(A), shall include any successor hospital "whether created by merger, amalgamation or otherwise howsoever"- The Newfoundland and Labrador Supreme Court, Trial Division, held that the testator did not intend to have his bequest in clause 6(3)(A)(b) given to the Salvation Army if it was not operating the Grace Hospital - The court held that the Eastern Regional Integrated Health Authority was the successor to the Grace Hospital and that it carried on the programs and services once delivered there at other institutions in the St. John's region under its mandate - See paragraphs 86 to 97.

Wills - Topic 3506

Charitable gifts - General or paramount charitable purpose - [See Trusts - Topic 372 ].

Wills - Topic 3543

Charitable gifts - Cy-près doctrine - Circumstances when doctrine applied - The Newfoundland and Labrador Supreme Court, Trial Division, stated that "A gift for the purposes, either general or specific, of a hospital are clearly charitable. Simply because a hospital has become a government agency does not mean it ceases to be a proper charitable object" - See paragraph 90.

Wills - Topic 4248

Failure of gifts - Uncertainty - What constitutes - [See Trusts - Topic 372 ].

Wills - Topic 5184

Construction - General - Evidence and proof - Armchair rule - The Newfoundland and Labrador Supreme Court, Trial Division, stated that "The armchair rule, as other rules of construction, only comes into play when there is an ambiguity or the intention of the testator cannot be ascertained from the words of the will. If the words of the will are plain and obvious, there is no need or justification to look at rules of construction such as the armchair rule" - See paragraph 36.

Wills - Topic 6807

Construction - Persons entitled to take - Class gifts - When class closes - [See Devolution of Estates - Topic 425 ].

Words and Phrases

Worthwhile - The Newfoundland and Labrador Supreme Court, Trial Division, discussed the meaning of the word "worthwhile" as found in a testamentary clause disposing of a portion of the residue of an estate - See paragraphs 21 to 58.

Cases Noticed:

Pemsel v. Special Commissioners of Income Tax, [1891] A.C. 531 (H.L.), refd to. [para. 25, footnote 5].

Vancouver Society of Immigrant and Visible Minority Women v. Minister of National Revenue, [1999] 1 S.C.R. 10; 234 N.R. 249, refd to. [para. 26, footnote 6].

Chichester Diocesan Fund v. Simpson et al., [1994] 2 All E.R. 60 (H.L.), refd to. [para. 32].

Brewer and Murray v. McCauley, [1955] 1 D.L.R. 415 (S.C.C.), refd to. [para. 33].

Maher et al. v. Bussey et al. (2006), 256 Nfld. & P.E.I.R. 308; 773 A.P.R. 308; 2006 NLCA 28, refd to. [para. 36, footnote 9].

Forbes Estate, Re (2003), 268 N.B.R.(2d) 201; 704 A.P.R. 201; 2003 CarswellNB 553 (T.D.), refd to. [para. 38].

Lecavalier v. Sussex (Town) - see Forbes Estate, Re.

Wilkinson v. Lindgren (1870), 5 Ch. App. 570, refd to. [para. 45].

Bennett, Re, [1920] 1 Ch. 305, dist. [para. 56].

Connell v. Connell (1906), 37 S.C.R. 404, dist. [para. 60].

Klassen Estate v. Klassen et al. (1986), 50 Sask.R. 64; 1986 CarswellSask 238 (Q.B.), dist. [para. 60].

Daniels v. Daniels Estate et al. (1991), 120 A.R. 17; 8 W.A.C. 17; 85 D.L.R.(4th) 116 (C.A.), dist. [para. 60].

Bullock v. Downes (1860), 9 H.L. Cas. 1, not appld. [para. 72].

Thompson v. Smith (1897), 27 S.C.R. 628, refd to. [para. 76].

National Trust Co. v. Fleury et al. (1966), 53 D.L.R.(2d) 700 (S.C.C.), dist. [para. 78].

Canada Trust Co. v. Fasken (1990), 69 D.L.R.(4th) 575 (Ont. H.C.), affd. [1993] O.J. No. 36 (C.A.), refd to. [para. 83].

Halifax School for the Blind v. Kelley Estate, [1937] S.C.R. 196, refd to. [para. 89, footnote 15].

Ross Estates, Re; Charlotte County Hospital v. St. Andrews (Town) (1980), 28 N.B.R.(2d) 611; 63 A.P.R. 611 (T.D.), refd to. [para. 90, footnote 16].

Avalon Consolidated School Board v. United Church of Canada et al. (1983), 42 Nfld. & P.E.I.R. 8; 122 A.P.R. 8 (Nfld. T.D.), affd. (1984), 47 Nfld. & P.E.I.R. 261; 139 A.P.R. 261 (Nfld. C.A.), refd to. [para. 90, footnote 16].

Boy Scouts of Canada, Provincial Council of Newfoundland v. Doyle et al. (1997), 151 Nfld. & P.E.I.R. 91; 471 A.P.R. 91 (Nfld. C.A.), refd to. [para. 90, footnote 16].

Coish Estate, Re (2000), 186 Nfld. & P.E.I.R. 90; 564 A.P.R. 90 (Nfld. T.D.), refd to. [para. 99, footnote 19].

Coish v. Coish - see Coish Estate, Re.

Mitchell v. Gard (1863), 164 E.R. 1280, refd to. [para. 99, footnote 19].

Holloway v. Holloway (2001), 199 Nfld. & P.E.I.R. 1; 600 A.P.R. 1 (Nfld. C.A.), refd to. [para. 99, footnote 19].

Authors and Works Noticed:

Feeney, Thomas G., The Canadian Law of Wills (4th Ed. 2000), paras. 13.32 [para. 67, footnote 13]; 14.36 [para. 72].

Halsbury's Laws of England (3rd Ed. 1955), vol. 39, pp. 946, 949 [para. 67, footnote 13].

Oosterhoff, Albert H., and Gillese, Eileen E., Text, Commentary and Cases on Trusts (5th Ed. 1998), p. 907 [para. 64].

Waters, Donovan W.M., The Law of Trusts in Canada (3rd Ed. 2005), pp. 625, 626 [para. 24, footnote 4]; 680 [para. 25, footnote 5]; 751 [paras. 27, 48, footnote 12]; 752 [para. 51]; 753, 754 [para. 59].

Williams' Law Relating to Wills (4th Ed. 1974), p. 269 [para. 37, footnote 10].

Counsel:

Regan P. O'Dea, for the applicants/trustees;

Lynne Butler, for Robert Butler;

Robert Regular, for John Butler and Natalie Butler;

Christopher Gill, for Stephen Butler and the Estate of Ernest Douglas Butler;

David F. Hurley, Q.C., and Andrew Fitzgerald, for the Estate of Flossie (Florence) Butler;

Thomas Johnson, for the Charitable Objects;

Paul L. Coxworthy, for the Eastern Regional Integrated Health Authority and the Health Care Foundation of St. John's Inc.

This application was heard at St. John's, Nfld. and Lab., by Adams, J., of the Newfoundland and Labrador Supreme Court, Trial Division, who delivered the following decision on May 17, 2007.