Wills and Estates lawyer Jennifer Corak's article "Interpreting in Equal Shares Per Stirpes: The Case of Jonas v Jonas" was published in Section Insider from the Ontario Bar Association's Trusts and Estates Law Section. The article addresses the importance of using clear language in Will clauses.
The article was originally published on March 4, 2023. To read it in OBA, visit: https://www.oba.org/Sections/Trusts-and-Estates-Law/Articles/Articles-2023/March-2023/Interpreting-in-equal-shares-per-stirpes-The-case?_zs=NnxsN1&_zl=1goT2 (no subscription required).
Interpreting in Equal Shares Per Stirpes: The Case of Jonas v Jonas
In the case of Jonas v Jonas,1 the Ontario Court of Appeal considered the proper interpretation of a Will's residue clause. More specifically, this case relates to the proper interpretation of the often used term "in equal shares per stirpes" in the context of a specific Will.
The deceased, Saul Jonas, was a senior lawyer with experience in wills and estates who died on March 26, 2018. He was survived by his common law spouse, Mary Ann West, and his four children. One of his children, Miriam Young, was the appellant in this case. Mary Ann West and two of the deceased's children (Naomi and Deborah) were appointed as Estate Trustees. At his death, the deceased had four grandchildren.
The relevant Will clause (the "Clause") provided:
I DIRECT my trustees to divide the rest, residue and remainder of my estate as follows: forty per cent (40%) to be divided equally among my children who shall survive me and sixty per cent (60%) to be divided equally between my grandchildren and my great grandchildren (if any) who shall survive me or be born within ten years of my decease, in equal shares per stirpes. Provided that the share to my grandchildren shall be kept and invested by my trustee and used for the support of such grandchildren and for their education and then paid to each of them upon such grandchild attaining the age of 40.
As mentioned above, there was uncertainty surrounding the interpretation of "in equal shares per stirpes" as found in this Clause. The Estate Trustees brought an application seeking the court's opinion, advice and direction, regarding the appropriate distribution. The application judge was presented with six different possible interpretations, but only two were argued before her – one by the appellant and one by the Office of the Children's Lawyer ("OCL") (who represented the interests of the deceased's grandchildren and unborn and unascertained beneficiaries of the deceased's estate).
Before the application judge, the appellant's position was that all of the residue (including the 60%) should be divided equally among the deceased's children. This would mean that: (a) a child who had no children on the vesting date (being 10 years after the date of death of the deceased) would receive one-quarter of the total residue (being 10% of the 40% allocation and 15% of the 60% allocation); and (b) any grandchildren alive on the vesting date would receive an equal share of their parent's 15% of the 60%.
Disagreeing with the appellant, the application judge held that the whole 60% was to be divided equally among the grandchildren alive on the date of the deceased's death, plus any grandchildren or great grandchildren born by the vesting date (being 10 years after the date of death of the deceased).2 This was the interpretation proposed by the OCL.
The application judge concluded that the deceased's intention was to create two classes of beneficiaries (the children being one and the grandchildren/great grandchildren being the other) and ensure an equal distribution within those classes, and that accepting an interpretation that gives any grandchild less or any child more would be inconsistent with the deceased's intention to be fair to each member of each class of beneficiary. The appellant's position would have given her (and one of her sisters) a greater benefit and created inequality among the grandchildren and great grandchildren.
On appeal, the only issue was whether the application judge erred in interpreting the Clause and, if so, how it should have been interpreted.3
In engaging in the process of Will interpretation and ultimately coming to her decision, the application judge relied on the "armchair rule" set out in the case of Dice v Dice Estate,4 which rule was reiterated by the Court of Appeal in the Jonas decision as follows:
[t]he court must determine the testator's intention as ascertained from the language that was used and the will as a whole. Where the intention cannot be ascertained from the plain meaning of the language used, the court may consider the surrounding circumstances known to the testator when making the will. The court sits in place of the testator and assumes the same knowledge they had of the extent of their assets, the size and makeup of their family, and their relationship to the family members, based on the evidence presented.
Noting the ambiguity of the Clause, the Court of Appeal found that the application judge properly applied the armchair rule.
The Court stated that it "[does] not accept that the case law interpreting the term per stirpes admits of only one definition." When it is unclear which generation forms the stirpes, the court must look at the language of the will for context. Where the Clause was concerned, the application judge determined that in the context of the deceased's Will, per stirpes reflected an intention to benefit equally the living grandchildren and any other grandchildren or great grandchildren born within the vesting period.
Further, the Court stated that although a number of different interpretations were open for consideration by the application judge, "she chose the one proposed by the OCL because it most closely conformed to her assessment of the testator's intention, reading the Will as a whole at the time it was made." The Court was not persuaded that there was a basis to disturb the application judge's decision and therefore dismissed the appeal.
1 2022 ONCA 845 [Jonas].
2 The application judge also found that the rule in Saunders v Vautier applied so that the funds would be available to each beneficiary as of the vesting date and upon reaching the age of 18 years. With respect to the remaining 40% of the residue, the decision confirms that the deceased's children received a partial distribution from the estate which all but the appellant agreed constituted their 40% share (see Jonas at para 7).
3 See Jonas at para 12 regarding standard of review. It is also noteworthy that the appellant raised a further possible interpretation of the Clause in her factum, the OCL argued it was inappropriate to raise the new argument for the first time on appeal, and the Court of Appeal found it was not necessary to address this issue as the appellant's submissions on the proposed interpretation of the Will revealed no error in the application judge's reasoning (see Jonas at paras 15-18).
4 2012 ONCA 468, at paras 36-38.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.