It is fairly common for will-makers (testators) to make bequests to charities in their wills. Such gifts can be a specified sum of money, an identified asset or a portion of the estate.
Where there are ambiguities in the language of the will, or the intentions of the testator are otherwise uncertain, will disputes are likely to arise, even in a charity context. A will which is unclear increases the likelihood of a party being able to claim that they are entitled under the will or that the will is void for uncertainty.
An example of a charity clause challenge comes from the recent decision of the Supreme Court of British Columbia in Royal Trust Corporation of Canada v The Welfare Institution of the Jews of Athens. In this case, a charity claimed to be entitled to money held in a trust created by a will. It highlights the importance of receiving advice from experienced estate litigators when an unclear will threatens your or your organization’s interests.
Will granted power of appointment to daughter to nominate charity
A woman born in Constantinople died in Victoria, British Columbia in 1986, after spending most of her life in Turkey, Greece and Switzerland. The year before she died, she prepared a will that created a testamentary trust. She directed her executors to set aside her deposits at the Royal Bank of Canada and pay the interest to her daughter “as long as she shall live”.
The will also allowed her daughter to appoint a Greek charity to receive the money in her will:
“If my daughter shall by her Last Will and Testament appoint sum [sic] reasonable charity within the country of Greece for such funds they shall be delivered in accordance with the directions made in such Last Will and Testament of my said daughter.”
Finally, the will contained a contingent beneficiary provision which stated that if the daughter did not make such an appointment, the money shall be paid “to the President for the time being of Estia of Constantinopolis”. This is a non-profit association that operates nursing homes in Greece.
Daughter appointed a charity, but later revoked this in another will
The testator’s daughter, who lived in Switzerland, made a will in 2017 that appointed the trust property to The Welfare Institution of the Jews of Athens, another Greek non-profit organization.
However, in a 2018 will, the daughter revoked all prior wills and left her estate to a Greek man. She then died in 2019.
The trust property contained funds of approximately $500,000. The trustee applied to the court seeking its direction as to how to distribute the money. The other parties were Estia of Constantinopolis and the representative of the daughter’s estate under Swiss law.
Court found the power of appointment in the 1985 will was valid
Justice Kent explained that the contest was between Estia and the daughter’s estate. The Welfare Institution of the Jews of Athens did not participate in the proceedings, and the other parties agreed that the daughter’s 2018 will revoked her 2017 will.
The first issue was whether the power of appointment in the 1985 will was valid. The daughter’s estate claimed that it was void for uncertainty because “[some] reasonable charity within the country of Greece” was too ambiguous.
His Honour agreed that the language was “perhaps somewhat vague” but not vague enough to be fatally uncertain. The property was earmarked for charitable purposes in Greece and the testator’s selection of Estia indicated these intentions. The daughter had no problem understanding the terms and selecting a charity as well.
The gift was intended to be made to the charity, not its president personally
The daughter’s estate also argued that the contingent beneficiary provision in the 1985 will, which granted the trust property to Estia if the daughter did not make an election, was invalid. The daughter’s estate claimed that it was unclear whether the gift was to go to the President personally, either the one in office in 1985 or the one currently in office, or to his office on behalf of Estia.
Justice Kent explained that courts make every effort to determine which beneficiary was intended by the testator. Given that the testator did not know the President of Estia and the provision included the phrase “for the time being”, his Honour concluded that it was the charity of Estia who was the intended beneficiary. The President in office at the time of distribution was simply the mechanism for delivery of the gift to the charity.
The gift goes to Estia under the contingent beneficiary provision
The final argument advanced by the daughter’s estate was that the gift to Estia failed because Greek law did not recognize trusts and the President held the gift in trust on behalf of Estia. Given that the testator was a Canadian citizen when she died, the trust was recognized under Greek law because it was a valid testamentary trust under Canadian law.
As a result, the Supreme Court decided that the trust property was payable to the charity Estia. Because the power of appointment in the testator’s will was valid, it was exercised by the daughter in her 2017 will but revoked by her 2018 will, and the gift went to the charity, not its president personally, under the contingent beneficiary provision of the testator’s will.
Contact Meridian Law Group in Vancouver for Representation in Estate Disputes
Meridian Law Group helps clients involved in estate disputes to enforce their rights and move on with their lives. Whether the will contains a charitable bequest or not, the estate litigators at Meridian Law Group will take action to protect your interests and resolve the conflict as soon as possible. Whether it be through negotiation or litigation, we deliver results that exceed expectations allowing you to put the stress caused by the dispute behind you.
Located in downtown Vancouver, the firm proudly represents clients throughout West Vancouver, North Vancouver, Coquitlam, Penticton, Kelowna, Richmond, New Westminster, Burnaby, Surrey, Langley, and White Rock. To arrange a confidential consultation for your estate matter, please call 604-687-2277 or reach out online.