Wilhelm v. Hickson,

• Jurisdiction: Saskatchewan
• Judge: Bayda, C.J.S., Sherstobitoff and Jackson, JJ.A.
• Neutral Citation: 2000 SKCA 1
• Court: Court of Appeal (Saskatchewan)
• Date: 21 September 1999

Earl v. Wilhelm (2000), 189 Sask.R. 71 (CA);

    216 W.A.C. 71

MLB headnote and full text

Temp. Cite: [2000] Sask.R. TBEd. FE.062

Don Wilhelm (defendant/appellant) v. Vernon Hickson, Leona Hickson, Wilhelm Heilman, Melanie Heilman (plaintiffs/respondents) and Ruth Bennett, Maxine Earl and Ruth Bennett as Administrator ad Litem for the Estate of Arnold Bennett, Executor of the Estate of Norman Thornton (third parties/respondents) and Melanie Heilman, as Administrator Ad Litem for the Estate of Arnold Bennett (plaintiff/non-party) and Alex G. Robertson, Walter A. Moskal, Myron I. Strilchuk, Greg D. Heinrichs and Robertson Moskal (fourth parties/non-parties) (File No. 2900)

Thomas Earl (plaintiff/appellant) v. Donald Anthony Wilhelm, Kevan Murray Migneault, Richard Anthony Gibbons and Murray Ernest Greenwood (defendants/respondents) and Ruth Bennett as Administrator of the Estate of Arnold Bennett, Executor of the Estate of Norman Thornton, Ruth Bennett and Maxine Earl (third parties/non-parties) and Alex G. Robertson, Walter A. Moskal, Myron I. Strilchuk, Greg D. Heinrichs and Robertson Moskal (fourth parties/non-parties)

(File No. 2903; 2000 SKCA 1)

Indexed As: Earl v. Wilhelm et al.

Saskatchewan Court of Appeal

Bayda, C.J.S., Sherstobitoff and Jackson, JJ.A.

January 20, 2000.

Summary:

The testator, Thornton, incorporated his farming operation for tax purposes. Osborn was his lawyer. Later, Thornton had a will prepared. Because Osborn had become a judge, Wilhelm, another lawyer in Osborn's firm, prepared the will. Thornton made specific bequests of farmland. The bequests failed because Thornton had transferred beneficial interest in the land to his corpor­ation. The land went to his residual benefi­ciaries. The specific beneficiaries sued Osborn and Wilhelm, the lawyers who had incorporated the farming operation and prepared the will, respectively, and their partners. The defendants third partied the residual beneficiaries and Thornton's execu­tor. Fourth party claims were brought against the lawyers in the firm that had advised Thornton's executor.

The Saskatchewan Court of Queen's Bench, in a decision reported at 160 Sask.R. 4, held that Wilhelm was negligent and Thornton was 25% contributorily negligent. The court dismissed the third party claim as against the residual beneficiaries and dis­missed the fourth party claims. Wilhelm applied, inter alia, for directions respecting the quantum of damages he was required to pay and the date of commencement of pre­judgment interest.

The Saskatchewan Court of Queen's Bench, in a decision reported at 164 Sask.R. 4, postdated the judgment in the case to the date of this fiat. The court amended the judgment respecting the quantum of damages and held that prejudgment interest was to be calculated from the date of the testator's death.

The Saskatchewan Court of Queen's Bench, in a decision reported at 166 Sask.R. 148, determined costs. Wilhelm and the specific beneficiaries appealed.

The Saskatchewan Court of Appeal dis­missed Wilhelm's appeal. The court allowed the specific beneficiaries' appeals respecting the calculation of damages.

Barristers and Solicitors - Topic 2590.1

Negligence - Particular negligent acts - Wills - Disappointed beneficiary - The Saskatchewan Court of Appeal held that solicitors were liable to intended benefici­aries who, as a result of the solicitor's negligence, have failed to receive the benefit which the testator intended they should receive - See paragraphs 1 to 42.

Barristers and Solicitors - Topic 2590.1

Negligence - Particular negligent acts - Wills - Disappointed beneficiary - Thorn­ton incorporated his farming operation for tax purposes - Osborn was his lawyer - Later, Thornton had a will prepared - Because Osborn had become a judge, Wilhelm, another lawyer in Osborn's old firm, prepared the will - Thornton made specific bequests of farmland - The bequests failed because Thornton had transferred beneficial interest in the land to his corporation - The land went to his residual beneficiaries - The disappointed beneficiaries sued Osborn, Wilhelm and their partners - The trial judge held that Wilhelm was negligent and Thornton was 25% contributorily negligent - The Saskatchewan Court of Appeal overturned the finding of contributory negligence because, inter alia, the pleadings did not raise the issue and the Contributory Negli­gence Act did not apply - See paragraphs 47 to 54.

Barristers and Solicitors - Topic 2677.1

Negligence - Damages - Re negligent preparation of will - A devise of specific parcels of land failed because the lawyer who prepared the will was negligent - The land passed to the residuary beneficiaries - The Saskatchewan Court of Appeal held that the trial judge erred when, in calculat­ing the specific beneficiaries' damages, he deducted from the value of the land real estate and legal fees equivalent to 7% - If the testator's intentions had been carried out, the specific beneficiaries would have been entitled to receive their devises free of any liability for legal fees or real estate commissions - See paragraph 71.

Barristers and Solicitors - Topic 2677.1

Negligence - Damages - Re negligent preparation of will - [See Damages - Topic 201 ].

Damages - Topic 201

Entitlement - Requirement of loss - Osborn incorporated Thornton's farming operation for tax purposes - Later, another lawyer in Osborn's firm (Wilhelm) pre­pared Thornton's will - Thornton made specific bequests of farmland - The bequests failed because Thornton had transferred bene­ficial interest in the land to his corporation - The land went to his residual bene­ficiaries - The specific bene­ficiaries sued Osborn, Wilhelm and their partners - The trial judge held that Wilhelm was negligent - In assessing damages, the judge held that two specific beneficiaries suffered no damage where their wives were the residual beneficiaries, they invested their assets jointly with their wives and expected to continue doing so, and they acquiesced in the application to defeat the specific bequests - One husband (specific bene­ficiary) appealed - The Saskatchewan Court of Appeal dismissed the appeal - See paragraphs 61 to 64.

Damages - Topic 205

Entitlement - Damages not capable of assessment - Osborn incorporated Thorn­ton's farming operation for tax purposes - Later, another lawyer in the same firm (Wilhelm) prepared Thornton's will - Thornton made specific bequests of farm- land - The bequests failed because Thorn­ton had transferred beneficial interest in the land to his corporation - The land went to his residual beneficiaries - The specific beneficiaries sued Osborn, Wilhelm and their partners - The trial judge held that Wilhelm was negligent - In assessing damages the judge excluded the value of the crops where the net value of the crop yield and its apportionment to the various lands could not be accurately determined and Thornton and his estate had incurred all the crop expenses - On appeal, the Saskatchewan Court of Appeal included the crop value in damages - Difficulty in quantifying damages was not a reason for not awarding them - In any event, there was very detailed evidence respecting the crops, their value and their harvesting cost - See paragraphs 65 to 69.

Practice - Topic 1617

Pleadings - The defence - Issues to be raised must be pleaded - [See second Barristers and Solicitors - Topic 2590.1 ].

Practice - Topic 5408.1

Judgments and orders - General - Collat­eral attack - The Surrogate Court held that specific gifts of land failed and distributed the land to the residuary beneficiaries - The disappointed beneficiaries sued the lawyer who drafted the will - The trial judge awarded the plaintiffs damages for the value of the land - The lawyer appealed on the ground, inter alia, that the plaintiffs' entitlement under the will was restricted to receiving the proceeds of sale of the lands and not the lands themselves (i.e., the $94,000 owing to the purchase price); the cause of the plaintiffs' loss was not his alleged negligence, but the error made by the Surrogate Court Judge - The Saskatchewan Court of Appeal rejected this ground of appeal as an impermissible collateral attack upon the Surrogate Court's order - See paragraphs 43 to 44.

Torts - Topic 6601

Defences - Contributory negligence - General - What constitutes contributory negligence - [See second Barristers and Solicitors - Topic 2590.1 ].

Cases Noticed:

White et al. v. Jones et al., [1995] 1 All E.R. 691; 179 N.R. 197 (H.L.), refd to. [para. 1].

Hedley Byrne & Co. v. Heller & Partners Ltd., [1964] A.C. 465 (H.L.), refd to. [para. 23].

Whittingham v. Crease & Co. (1978), 88 D.L.R.(3d) 353 (B.C.S.C.), refd to. [para. 23].

Ross v. Caunters, [1979] 3 All E.R. 580 (Ch. D.), refd to. [para. 23].

Watts v. Public Trustee for Western Australia, [1980] W.A.R. 97 (S.C.W.A.), refd to. [para. 23].

Sutherland v. Public Trustee, [1980] 2 N.Z.L.R. 536 (S.C.), refd to. [para. 23].

Gartside v. Sheffield, Young & Ellis, [1983] N.Z.L.R. 37 (C.A.), refd to. [para. 23].

Hodgson v. Evans & Rice, [1983] A.J. No. 576 (Alta. Q.B.), refd to. [para. 23].

Finlay v. Rowlands, Anderson & Hine, [1987] Tas. R. 60, refd to. [para. 23].

Hawkins v. Clayton (1988), 164 C.L.R. 539 (Aust. H.C.), refd to. [para. 23].

Makhan v. McCawley (1998), 58 O.T.C. 283; 158 D.L.R.(4th) 164; 22 E.T.R.(2d) 88 (Gen. Div.), refd to. [para. 23].

Smolinski v. Mitchell, [1995] 10 W.W.R. 68; 10 B.C.L.R.(3d) 366; 8 E.T.R.(2d) 247 (S.C.), refd to. [para. 23].

Seale v. Perry, [1982] V.R. 193, refd to. [para. 23].

Haig v. Bamford, [1977] 1 S.C.R. 466; 9 N.R. 43, refd to. [para. 24].

Rivtow v. Marine Ltd. v. Washington Iron Works, [1974] S.C.R. 1189, refd to. [para. 28].

University of Regina v. Pettick et al. (1991), 90 Sask.R. 241; 77 D.L.R.(4th) 615 (C.A.), refd to. [para. 28].

R. v. Wilson, [1983] 2 S.C.R. 594; 51 N.R. 321; 26 Man.R.(2d) 194, refd to. [para. 44].

Statutes Noticed:

Contributory Negligence Act, R.S.S. 1978, R.S.S. 1978, c. C-31, sect. 2, sect. 3 [para. 48].

Counsel:

P. Foley, Q.C., for Don Wilhelm;

M.S. Hall, for the respondents, Hickson and Melanie Heilman;

G. Currie, for Thomas Earl as appellant and respondent and also Maxine Earl as respondent;

R.G. Kennedy, for Ruth Bennett as indi­vidual and executor.

This appeal was heard on September 21, 1999, by Bayda, C.J.S., Sherstobitoff and Jackson, JJ.A., of the Saskatchewan Court of Appeal. Sherstobitoff, J.A., delivered the following decision for the Court of Appeal on January 20, 2000.