Spence v. BMO Trust Company, 2015 ONSC 615 & Spence v. BMO Trust Company, 2016 ONCA 196

By C.A. Gilmore, J
Ontario Superior Court & Ontario Court of Appeal
Jan 27, 2015





Verolin Spence and [redacted] Spence


– and –


BMO Trust Company, Donna Spence,[redacted] Spence-Perkins and [redacted] Spence-Perkins








Michael S. Deverett, for the Applicants


Heather B. Hogan, for the Respondent, BMO Trust Company

No One Appearing for the Respondents, DonnaSpence, [redacted] Spence-Perkins and [redacted]Spence-Perkins






HEARD: January 13, 2015





[1]               This application was brought for advice and directions in relation to a dispute initiated by the daughter of the deceased against her sister, the other daughter of the deceased, and the Trustee, Respondent, BMO Trust Company.

[2]               The applicant’s sister, Verolin Spence, requested the court set aside the last will and testament of her father, Rector Emanuel Spence, deceased.  The deceased’s will disinherits her and benefits her respondent sister, Donna Spence, and Donna’s two children, the remaining respondents, [redacted] Spence-Perkins and [redacted] Spence-Perkins.  Verolin asserts that the will is void for public policy reasons and should be set aside resulting in an intestacy.  An intestacy under the Succession Law Reform Act in Ontario would result in the two sisters sharing the estate equally. 

[3]               Verolin also brings the application on behalf of her son, [redacted], born [redacted], 2003.  [redacted] [redacted] [redacted] are the grandchildren of the deceased.  Verolin asks the court to disregard a statutory limitation period that expired over a year ago and grant dependant support and interim costs to her and [redacted], for whom she acted as litigation guardian. 

[4]               The respondent, BMO Trust Company, in its capacity as Estate Trustee with a Will, opposes the applicants’ request for relief.

[5]               After hearing submissions, the court determined that the will would be set aside on the grounds that a provision of the will offended public policy.  Given that decision, it was not necessary for the court to determine the applicants’ request for leave to proceed with an application for dependent’s relief.   In the event that issue had to be decided, I would have found that the applicants did not meet the test for leave and would have denied the claim for dependent’s support and interim costs. 

[6]               In the result, it was further ordered on the hearing date that BMO’s costs would be paid out of the estate and that the applicants’ legal costs of $11,300 would also be paid out of the estate.  The value of the estate as of the date of hearing the application was $398,875.

[7]               Given that BMO’s appointment as estate trustee became void as a result of the intestacy, counsel were invited to provide further brief written submissions in the event that the distribution of the estate on an ongoing basis became an issue.

[8]               Affidavits were submitted in this case by Verolin, as well as Imogene Parchment, on behalf of the applicants.  The respondent, BMO, provided a factum and a six paragraph affidavit of Kathy Melidy, sworn January 5, 2015.

[9]               The endorsement of January 13, 2015 indicates that reasons would follow with respect to the setting aside of the will.  These are the reasons.

Background Facts

[10]           The deceased died on January 25, 2013 at the age of 71 and was predeceased by his wife, Norma Spence, who died on June 25, 2011.  Verolin and Donna are the deceased’s two adult children by a previous marriage.  They are 51 and 52 years old respectively.  [redacted] is Verolin’s 11 year old child, born [redacted] 2003, and Verolin acted as his litigation guardian.  Donna’s two minor children, [redacted] and [redacted], live with her in the United Kingdom.  Donna did not file a Notice of Appearance, nor attend on the hearing of the application, although properly served.

[11]           The Office of the Children’s Lawyer was served with all of the documentation in this case.  They did not appear at the hearing on the grounds that they were concerned about an increase in legal costs and duplication of effort.  They have asked to be advised of the result of the hearing.  BMO was the Trustee of the deceased’s estate until the will was set aside as a result of this judgment.

[12]           When the deceased separated from Verolin and Donna’s mother, Verolin began to reside exclusively with the deceased and Donna resided exclusively with her mother.  After separation, Donna and Verolin never lived together with the same parent, nor did they communicate with each other.

[13]           In 1979, the deceased immigrated to Canada.  Verolin remained in London, England to complete her secondary school education.  Donna remained in the United Kingdom and never immigrated to Canada.  In January 1984, Verolin completed her General Certificate of Education examination from the University of London and immigrated to Canada to reside with her father.  At no time when Verolin was living with her father, or in communication with him, did he ever express an interest in visiting Donna, nor did Donna ever visit him during the time he lived in England and Canada.

[14]           From 1987 to 1989, Verolin attended full-time undergraduate studies at York University in Toronto.  She lived with her father during this time and graduated from York University with a Bachelor of Arts degree in history.

[15]           From 1989 to 1990, the deceased supported Verolin while she attended full time at the University of London, Institute of Education in England.  She graduated with a post-graduate certificate in Education and Business Studies and Economics on August 1, 1990.

[16]           From 1990 to 1991, the deceased supported Verolin while she attended full-time studies at the University of London, Institute of Education in England and she graduated with a Master of Arts degree in Education in Multi-Cultural Urban Areas on November 20, 1991.

[17]           Verolin returned to Canada from her graduate studies in 1992 and lived with her father at his home on 11 Ridgefield Crescent, Maple, Ontario.  Around that time, the deceased advised his daughter that he had made a will which provided that she would inherit 11 Ridgefield Crescent.  The deceased gave Verolin a set of keys allowing her unlimited and continued use of that property.

[18]           From 1994 to 1997, the deceased supported Verolin while she attended full-time studies at the New York School of Law at Queen’s College.  She graduated with a law degree on August 1, 1997.  Verolin’s affidavit indicated that her father placed a great deal of emphasis on education and that he was very pleased and proud of her educational accomplishments.  She deposed that he had provided her with support and tuition for her eight years of post-secondary education and that they had an excellent relationship.

[19]           In September 2002, Verolin’s relationship with her father came to a dramatic end.  She told her father that she was pregnant and that the father of her child was Caucasian.  Her father exclaimed that he was ashamed of Verolin and from that point onwards, the deceased restricted his communication with her.  He made it clear to Verolin, according to her affidavit, that he would not allow a white man’s child in his house. 

[20]           From 2002 until his death in 2013, the deceased would not return Verolin’s calls and refused to have anything to do with his grandson, [redacted].

[21]           Verolin is aware that from the time of the separation of her parents, Donna had little or no contact with the deceased.  She certainly never lived with him, nor did her father express any intention to contact Donna.  In fact, Donna’s name never came up in any of their conversations.  [redacted] and [redacted] have never met the deceased, nor did they have any contact with him.  As far as Verolin is aware, her father never provided any financial support to [redacted] , [redacted], or [redacted].

[22]           The deceased’s last will and testament, dated May 12, 2010, includes a clause specifically pertaining to the disinheritance of Verolin at page 4, paragraph 5(h), which is reproduced below:

I specifically bequeath nothing to my daughter, Verolin Spence, as she has had no communication with me for several years and has shown no interest in me as a father.

[23]           The will appoints BMO as estate trustee and distributes the estate to Donna and her two children.  BMO obtained a Certificate of Appointment of Estate Trustee with a Will on May 1, 2013, and has been administering the estate since that date, pursuant to the Certificate of Appointment. 


Affidavit of Imogene Parchment

[24]           Imogene Parchment was a friend of the deceased and deposed that she had known the deceased’s wife, Norma Spence, for over thirty-five years.  Norma and the deceased did not have any children.  Ms. Parchment was aware that the deceased had two children from a previous relationship, namely Verolin and Donna. 

[25]           Ms. Parchment met Norma when they worked as nurses at North York Branson Hospital in 1981.  They were best friends from 1981 until Norma died on June 25, 2011.  As Norma’s best friend, Ms. Parchment spent a lot of time with her and the deceased, and met Verolin at their home many times when Verolin was living with her father while attending York University.

[26]           Ms. Parchment deposed that before Norma died, the deceased had a falling out with both of his daughters.  When he found out that the father of Verolin’s son was not black, he told Ms. Parchment that he had no further use for Verolin and her “bastard white son”.  He told her on several occasions that the reason he disinherited Verolin and her son was because the father of her son was white.  He told her that he changed his will on May 12, 2010, because he wanted to exclude Verolin and include Donna and her two sons, since the father of Donna’s sons was black.

[27]           Ms. Parchment deposed that after the deceased signed his will on May 12, 2010, he told her that he had had a fight with his daughter, Donna, on the telephone and that he would never call her again, nor did he want anything to do with her.

[28]           Ms. Parchment cared for Norma during her illness and she asked her friend to take care of her husband while she was in hospital.  After Norma’s death, Ms. Parchment kept her promise to Norma and took care of the deceased until he died.  Ms. Parchment’s evidence was that she visited the deceased several times every week to attend to his needs and that he was a difficult person.  He had an explosive temper and was demanding.  He had virtually no friends and mistreated his agency caregivers to the point where the agency stopped sending them.  About two weeks before his death, Ms. Parchment spoke with the deceased about the possibility of reconciling with his two daughters.  The deceased went into a rage, banging his fists on the table and told her that he had changed his will, removing both his daughters and their children as beneficiaries. 

[29]           On December 25, 2012, the deceased suffered a stroke.  While in hospital, no one visited him, other than Ms. Parchment and his doctors.  The deceased died on January 25, 2013.  The only people who attended his funeral were friends of Norma’s and Ms. Parchment deposed that she was the closest friend to the deceased before he died.

[30]           Based on Ms. Parchment’s knowledge, Donna never visited the deceased, nor did he visit her in England.   Donna told Ms. Parchment by phone after the deceased died, that she had never been to Canada.  Donna did not come to the deceased’s funeral.  Donna never expressed that she was sorry that she would not be attending her father’s funeral.

[31]           Subsequent to his death, Ms. Parchment contacted Kathy Melidy, the trust officer at BMO, and made arrangements to provide her with the key to the deceased’s residence.  She mentioned that the deceased had told her that he had made another will after May 12, 2010.  No will has subsequently been discovered.

[32]           Ms. Parchment’s evidence in her affidavit was that it was clear to her that the reason the deceased excluded Verolin from his will and included Donna and her sons, was because Verolin had a child with a man who was not black and he wanted to discriminate against her.

The Issues

Is the will void on grounds of public policy?

[33]           The applicants take the position that the will should be set aside based on public policy resulting in an intestacy.  The applicants rely on the Parchment affidavit, which has not been challenged by BMO, nor was Ms. Parchment cross examined.  The uncontradicted evidence of Ms. Parchment is that the reason the deceased gifted money to Donna and her children was to make a point to Verolin in relation to her having a child with a Caucasian man. 

[34]           BMO’s position is that public policy does not apply absent a testamentary document that is manifestly contrary to the public interest. Further, the applicant’s extrinsic evidence as to the alleged utterances of the deceased is immaterial to the issue and in any event do not comply with the Ontario Evidence Act.

[35]           The leading authority on the doctrine of public policy is Canada Trustco v. Ontario (Human Rights Commission) also known as Re: Leonard, 1990 CarswellOnt 486.  In that case, the court considered whether the terms of a trust established by Ruben Wells Leonard was void by (a) reason of public policy as declared in the Human Rights Code 1981; (b) other public policy; (c) discrimination because of race, creed citizenship, ancestry, place of origin, colour, ethnic origin, sex, handicap or otherwise; or (d) certainty. 

[36]           The lower court found that the trust provisions were not invalid for any of the reasons set out above.  Specifically, the trust document opened with four recitals that required that the recipient of any scholarships from the trust must be white, Christian, of British nationality or parentage and that only twenty-five per cent of the recipient of the scholarships could be women.  

[37]           The Ontario Court of Appeal found that it was in the interests of society that the court intervene on the grounds of public policy.  While it recognized the freedom of an owner of property to dispose of his or her property as he or she chose and that this was an important interest that has long been recognized in society, the court held that the trust was premised on notions of racism and religious superiority, which contravened contemporary public policy.  The court struck out the recitals and removed all restrictions with respect to race, colour, creed, religion, ethnic origin and sex.

[38]           BMO argued that the public policy doctrine does not apply in a case such as this in which the granting document (ie: the will) does not say anything that would contravene public policy or create harm to the public.  There is no mention in the will that Verolin is being disinherited because the father of her child is not black.  In fact, the will states that the basis for Verolin’s disinheritance was a lack of communication with her father.  As of the date when Verolin informed her father of the parentage of her child there had been no communication between Verolin and her father, and as such, the relevant paragraph of the will cannot be impugned.

[39]           The applicants rely on McCorkill v McCorkill Estate2014 NBQB 148 (CanLII), 2014 NBBR 148 (NB QB).  In that case, the court determined that the payment or transfer of the residue of the McCorkill Estate to National Alliance was against public policy, as National Alliance had a long history of inspiring and carrying out hate motivated violence and terror.  There were many interveners in the case, including the Province of New Brunswick, B’Nai Brith, the Centre for Israel and Jewish Affairs and the Canadian Association for Free Expression.  The court held that the information disseminated by National Alliance was hate propaganda, which it described as “malodorous, malicious and evil” and was of the kind targeted by the Criminal Code.  The court held that the dissemination of hate propaganda by the National Alliance violated public policy of Canada.  The residual request to National Alliance in the will of Harry Robert McCorkill was found to be void.

[40]           BMO noted that the McCorkill case has not escaped criticism and that the facts in the case at bar are very different from the facts in McCorkill.  InMcCorkill, the National Alliance was a corporation which had a long record of publishing hate speech.  The court likened the gift in the will to financing hate speech and acknowledged the narrow circumstances of the case.  The facts in the case were unusual given the number of interveners and given the court’s own comments about the unique nature of the case.

[41]           BMO submits that the facts in the case at bar are very different as the case at bar involves a gift of residue to the deceased’s daughter in the United Kingdom.  There is nothing manifestly harmful in that as Donna and her children are individuals and there is no evidence that Donna would do anything harmful with her inheritance.  On the contrary, one must only look at the granting document which sets out that the reason for the disinheritance which is clearly stated and based on the deceased and Verolin not having talked in years.

[42]           BMO points out that the courts have not looked at the intentions of the deceased in public policy cases and will do so only where the validity of the will is in issue, or if there is any ambiguity or uncertainty on the face of the will.  None of those factors apply in this case.  The relevant terms of the will are unambiguous and the validity of the will has never been challenged.

[43]           The applicants rely on the McCorkill case as being an example of a fact situation in which a will was set aside, even when the terms of the will on its face did not offend public policy.  Specifically, the applicants rely on the analysis in the McCorkill case in which Grant J. refers to Egerton v. The Earl of Brownlow, (1853) 10 E.R. 359 (UK HL) at para 84,

The owner of an estate may himself do many things which he could not (by a condition) compel his successor to do.  One example is sufficient.  He may leave his land uncultivated, but he cannot, by a condition, compel his successor do so.  The law does not interfere with the owner and compel him to cultivate his land (though it be for the public good that land should be cultivated) so far the law respects ownership; but when, by a condition he attempts to compel his successor to do what is against the public good, the law steps in and pronounces the condition void.

[44]           While it is true that the relevant paragraph in the deceased’s will does not, on its face, offend public policy I find that, like McCorkill, the matter bears further scrutiny.  The court has before it the uncontradicted evidence of Ms. Parchment and the applicant herself.  I note that Ms. Parchment has no stake in this case.  She is neither a beneficiary, nor an executor and stands to gain nothing by her participation in this application.  She was friends with both the deceased and his wife.  She took care of the deceased because of her friend’s dying request and despite the fact that the deceased had a rather explosive temper and unappreciative manner.

[45]           There is therefore no reason not to accept the evidence of Ms. Parchment as to the utterances of the deceased with respect to his daughter, Verolin, and an explanation as to why she would be left out of the will.  Those statements, taken on their face, express a very specific reason for disinheritance; that is, that Verolin had a child by a man who was not black.  Both the applicant’s affidavit and that of Ms. Parchment make it very clear that at the moment of discovering this fact, the deceased stopped communicating with Verolin, notwithstanding her efforts to try to resurrect such communication. 

[46]           There is no evidence that prior to learning about the child’s parentage, Verolin had anything but a good and healthy relationship with her father.  In fact, her father financed many years of post-secondary education for Verolin, both in Canada, the United States and England. There can be no explanation for such a sudden and complete cessation of communication between the deceased and Verolin other than the information received by the deceased about the father of his grandson.

[47]           What adds to the unique facts in this case is that the deceased’s other daughter, Donna, did not file a Notice of Appearance, nor did she attend at the hearing of the application, although properly served.  There is therefore no evidence to contradict that of Verolin and Ms. Parchment that the deceased had no relationship with his daughter, Donna, nor had he ever seen his grandchildren, Kairo and Kailen. 

[48]           In Professor Bruce Ziff’s  article, Welcome the Newest Unworthy Heir, 1 ETR-CAN-ART 76, Estates and Trust Reports (Articles) 2014 he raises important questions with respect to the application of the doctrine of public policy when it comes to private gifts made through wills.  Professor Ziff specifically grapples with the issue in McCorkill, with respect to whether or not a will should be set aside where the granting document itself does not contain any impugned terms.  Professor Ziff acknowledges that fixing on stipulations such as terms which expressly recite discriminatory preferences are important but that such elements were not necessary in the McCorkill case because the racist preferences were found memorialized in the published works of the donee.  Professor Ziff concludes that despite issues with respect to litigation floodgates and the necessity of having specifically recited terms in the granting document, that there was something absolutely correct about the holding in the McCorkill case.

[49]           Were it not for the unchallenged evidence of Ms. Parchment and Verolin, the court would have no alternative but to go no further than the wording in the will.  However, it is clear and uncontradicted, in my view, that the reason for disinheriting Verolin, as articulated by the deceased, was one based on a clearly stated racist principle.  Does it offend public policy that the deceased’s other daughter, Donna, should receive the entire estate simply because her children were fathered by a black man?  That, in my view, offends not only human sensibilities but also public policy.

[50]           For the reasons given above, the will is set aside.  Pursuant to the Succession Law Reform Act in Ontario, there is a resulting intestacy and the deceased’s estate shall therefore be divided equally between Verolin and Donna.

[51]           The applicants’ solicitors shall receive $11,300 from the estate in costs, inclusive of disbursements and HST.  BMO’s costs shall also be paid out of the estate.  Given that the intestacy results in BMO’s appointment as estate trustee becoming void, counsel are at liberty to provide short written submissions to me in the event there are issues with respect to the distribution of the estate ongoing.


Justice C.A. Gilmore

 Released: January 27, 2015




CITATION: Spence v. BMO Trust Company, 2016 ONCA 196

DATE: 20160308

DOCKET: C60021

Cronk, Lauwers and van Rensburg JJ.A.

In the Estate of Rector Emanuel Spence, also known as Eric Spence, deceased


Verolin Spence and A.S.

Applicants (Respondents)


BMO Trust Company, Donna Spence, K. S.-P. and K. S.-P.

Respondents (Appellant)

Justin W. de Vries and Angela Casey, for the appellant

Earl A. Cherniak, Q.C., Jasmine T. Akbarali and Michael S. Deverett, for the respondents

Heard: September 4, 2015

On appeal from the judgment of Justice Cory A. Gilmore of the Superior Court of Justice, dated January 13, 2015, with reasons reported at 2015 ONSC 615.

Cronk J.A.:

[1]          Is it open to the courts to scrutinize an unambiguous and unequivocal residual bequest in a will, with no discriminatory conditions or stipulations, if a disappointed beneficiary or other third party claims that the bequest offends public policy?  Is third-party extrinsic evidence of the testator’s alleged discriminatory motive for making the bequest admissible on an application to set aside the will on public policy grounds?

[2]          This appeal raises these important issues.  They are matters of first impression for this court.

I.        Background Facts

(1)         The Parties

[3]          Rector Emanuel Spence, also known as Eric Spence (“Eric”), was born in Jamaica. He died in Ontario on January 25, 2013 at 71 years of age.  He was predeceased by his wife, Norma Spence (“Norma”).  Eric and Norma had no children. 

[4]          Eric and his previous partner had separated in about 1964 or 1965. They had two children: the respondent Verolin Spence, born in England in 1963, and Donna Spence, born in England in 1964.  Verolin is now 52 years of age.  Donna is 51 years of age.

[5]          After their parents separated, Verolin lived with her father and Donna lived with her mother.  The two sisters did not communicate with each other after the separation.  

[6]          Eric immigrated to Canada from England in 1979.  Verolin joined him in 1984.  She lived with her father in Canada, except for periods of educational study abroad, until approximately 1993.  Donna lived with her mother in England.  She continues to live there, with her children.

[7]          According to Verolin, she and her father enjoyed a positive relationship for many years.  However, as I will describe in more detail later in these reasons, she claims that their relationship changed in September 2002 when she told Eric that she was pregnant. Verolin says that Eric, a black man, began to restrict his communications and any other contact with her when he learned that the father of her child was white. 

[8]          Verolin gave birth to her son A.S. on April 26, 2003.  A.S. is now almost 13 years old.  Unfortunately, he never met Eric.

(2)         The Will

[9]          Eric made a will on May 12, 2010, almost eight years after Verolin alleges that he cut off all contact with her (the “Will”).  The Will makes no provision for Verolin or A.S.  Instead, it provides that: i) Donna’s two sons are to inherit Eric’s jewellery; ii) Norma or, if Norma predeceased Eric, Donna, is to inherit Eric’s personal and household articles; iii) the residue of Eric’s estate is to be divided in equal shares among Donna and her sons; and iv) one of Eric’s cousins is the remainder beneficiary of Eric’s estate.

[10]       Eric expressly excluded Verolin from sharing in any part of his estate. Clause 5(h) of the Will states:

I specifically bequeath nothing to my daughter, [Verolin] as she has had no communication with me for several years and has shown no interest in me as her father.

[11]       The appellant, BMO Trust Company (“BMO Trust”), was issued a Certificate of Appointment of Estate Trustee with a Will on May 1, 2013 and began to administer the estate.

(3)         The Litigation

[12]       Verolin and A.S. did not challenge the Will or BMO Trust’s appointment as estate trustee in the probate proceeding.  Instead, in mid-October 2014, they applied in the Superior Court under r. 75.06 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 and ss. 58 and 60 of the Succession Law Reform Act, R.S.O. 1990, c. S.26 (the “SLRA”) for: i) a declaration that the Will was void, in whole or in part, because it was contrary to public policy; ii) leave to proceed with a dependant’s relief application under the SLRA; and iii) directions from the court.

[13]       In support of the application, Verolin filed her own affidavit, together with an affidavit sworn by Imogene Parchment (“Imogene”), one of Norma’s friends who had acted as Eric’s occasional caregiver after Norma’s death.  In both affidavits, the affiants alleged that Eric’s decision to exclude Verolin and A.S. from his Will was racially-motivated.  Neither Verolin nor Imogene were cross-examined on their affidavits.  I will refer to their affidavit evidence, collectively, as the “Extrinsic Evidence”.

[14]       Verolin described the nature of her relationship with her father in her affidavit. She said, among other things, that she and Eric enjoyed a very good relationship as father and daughter from the time of her birth.  However, Verolin alleged that this changed dramatically in the fall of 2002:  

In about September 2002, my relationship with my father came crashing down. That is the time when I told my father that I was pregnant. When he found out that the father of my child to be was white, my father told me that he was ashamed of me. From that point onwards, my father restricted his communications with me.

My father made it very clear to me that he would not allow a “white man’s child" in his house.

The reason my father severed the relationship with me is because I gave birth to a child fathered by a white man.

[15]       Imogene’s affidavit supported Verolin’s version of the reason for her estrangement from her father and exclusion from the Will.  Imogene swore that: i) Eric had told her on several occasions that he disinherited Verolin and A.S. because A.S.’s father was a white man; ii) Eric had told her that he changed his Will on May 12, 2010 “because he wanted to exclude Verolin and include Donna and her two sons, since the father of Verolin’s son was white and the father of Donna’s sons was black”; and iii) based on her relationship with Eric, it was “very clear” to her that the reason he excluded Verolin from his Will, and included Donna and her sons, was “because he wanted to discriminate against Verolin because the father of her son was a white man”.

[16]       Verolin also swore in her affidavit that, in about 1992, Eric told her that he had made a will specifying that she was to inherit his home on his death.  In her affidavit, Imogene indicated that Eric had told her that he “changed his will” in 2010 essentially to disinherit Verolin and benefit Donna and her two sons.  No other evidence regarding the alleged existence of this earlier will forms part of the record before this court.  In any event, the Will contains a standard revocation clause, revoking all prior wills, codicils and testamentary dispositions by Eric.

[17]       Based on the Extrinsic Evidence, and contrary to the plain language of clause 5(h) of the Will, Verolin argued before the application judge that the real reason she was disinherited by her father was because she gave birth to a child fathered by a white man. She asserted that, because her disinheritance was motivated by racial discrimination on Eric’s part, the Will was void by reason of public policy and should be set aside.

(4)         Application Judge’s Decision

[18]       The application judge held that, on its face, clause 5(h) of the Will did not offend public policy (at para. 44).  She also stated, at para. 49: “Were it not for the unchallenged evidence of Ms. Parchment and Verolin, the court would have no alternative but to go no further than the wording in the [W]ill.”

[19]       The application judge further held that, given the “uncontradicted” and “clear” Extrinsic Evidence, Eric’s reason for disinheriting Verolin was “based on a clearly stated racist principle” and that the provisions of the Will favouring Donna and her sons to the exclusion of Verolin offended “not only human sensibilities but also public policy” (at para. 49). 

[20]       The application judge therefore set aside the Will, in its entirety, on the basis that it violated public policy against discrimination on racial grounds.  She also granted declarations that an intestacy in Eric’s estate thereby resulted by operation of the SLRA and, consequently, that the estate was to be divided equally between Verolin and Donna.  Notably, the effect of these declarations was to wholly disinherit Donna’s sons, named beneficiaries under Eric’s Will.  The application judge granted costs to Verolin and A.S. ($11,300) and to BMO Trust, payable out of Eric’s estate.

[21]       In light of her decision to set aside the Will, the application judge concluded that it was unnecessary to address Verolin and A.S.’s request for leave to proceed with a dependant’s relief claim under the SLRA. Nonetheless, she indicated that, if the leave application had to be decided, she would have denied leave as the test for leave had not been made out.

[22]       BMO Trust appeals the application judge’s decision setting aside the Will on public policy grounds. Verolin and A.S. do not cross-appeal the application judge’s ruling on their SLRA claim.  Donna and her sons took no part in the proceedings before the application judge or this court.[1]

II.       Issues

[23]       As argued, the appeal raises four issues:

(1)     Was the Extrinsic Evidence admissible before the application judge?

(2)     If the answer to question (1) is ‘yes’, did the application judge err in her assessment of the Extrinsic Evidence?

(3)     Did the application judge err by improperly interfering with Eric’s testamentary freedom?

(4)     In any event, did the application judge err by setting aside the entire Will, rather than only the residual bequest?

III.      Analysis

(1)         Parties’ Positions

[24]       BMO Trust makes four main arguments.  First, it submits that the Extrinsic Evidence, as evidence of Eric’s intention behind disinheriting Verolin and benefiting Donna and her two sons, was inadmissible.  Further, and in any event, it submits that the application judge erred by placing any weight on the Extrinsic Evidence because it is contradictory and internally inconsistent. 

[25]       Second, BMO Trust argues that the application judge unjustifiably interfered with Eric’s testamentary freedom, which allows him to distribute his property as he chooses, subject only to certain statutory requirements that are inapplicable in this case.

[26]       Third, BMO Trust says that, for various reasons, the application judge did not have jurisdiction to set aside the entire Will.  And, fourth, allowing the application judge’s decision to stand would increase uncertainty in estates law and open the floodgates to litigation in estates matters.

[27]       In response to the first argument, Verolin and her son submitted in their factum that the Extrinsic Evidence was properly admissible “to evaluate whether Eric’s intention to disinherit Verolin and benefit Donna and her children offends public policy”.  During oral argument, this position shifted.  At the appeal hearing, Verolin and A.S.’s counsel acknowledged that evidence of Eric’s intentions in disposing of his property under his Will was inadmissible on the authority of this court’s decision in Rondel v. Robinson Estate, 2011 ONCA 493, 106 O.R. (3d) 321, leave to appeal to S.C.C. refused, [2011] S.C.C.A. No. 536.  Nonetheless, they maintained that the Extrinsic Evidence was properly admissible because it relates, not to Eric’s intention, but rather, to his specific discriminatory motive for disinheriting Verolin.       

[28]       Verolin and A.S. submit that the Extrinsic Evidence supports the application judge’s finding that the Will is based on offensive racist principles.  Further, the application judge made no palpable and overriding error in her assessment of the Extrinsic Evidence.  As a result, she did not err in concluding that the Will must be set aside as contrary to public policy against discrimination.

(2)      Testamentary Freedom

[29]       I begin my analysis of the issues on appeal with consideration of the important principle of testamentary freedom.

[30]       A testator’s freedom to distribute her property as she chooses is a deeply entrenched common law principle.  As this court emphasized in Canada Trust Co. v. Ontario (Human Rights Commission) (1990), 74 O.R. (2d) 481, at p. 495, citing Blathwayt & Lord Cawley, [1976] A.C. 397, [1975] 3 All E.R. 625 (H.L.):

The freedom of an owner of property to dispose of his or her property as he or she chooses is an important social interest that has long been recognized in our society and is firmly rooted in our law. 

[31]       The Supreme Court has also recognized the importance of testamentary autonomy, holding that it should not be interfered with lightly, but only in so far as the law requires: Tataryn v. Tataryn Estate, [1994] 2 S.C.R. 807, at p. 824.

[32]       The freedom to dispose of her property as a testator wishes has a simple but significant effect on the law of wills and estates: no one, including the spouse or children of a testator, is entitled to receive anything under a testator’s will, subject to legislation that imposes obligations on the testator.

[33]       Tataryn is a case in point.  In Tataryn, the Supreme Court was concerned with the principles to be applied to s. 2(1) of the British Columbia Wills Variation Act, R.S.B.C. 1979, c. 435.  Under that section, if a testator failed to make adequate provision for the proper maintenance and support of a surviving spouse and children, including independent adult children, the court was authorized to order provision from the estate that it considered “adequate, just and equitable in the circumstances” for the claimant.[2] 

[34]       In considering the purposes and scheme of the British Columbia statute, the Supreme Court held that the legislation protected two interests: i) adequate, just and equitable provision for the spouses and children of testators; and ii) testamentary autonomy.  With respect to testamentary autonomy, the Supreme Court observed, at p. 816:

The Act did not remove the right of the legal owner of property to dispose of it upon death.  Rather, it limited that right.  The absolute testamentary autonomy of the 19th century was required to yield to the interests of spouses and children to the extent, and only to the extent, that this was necessary to provide the latter with what was “adequate, just and equitable in the circumstances”.   [Emphasis in original.]

[35]       Tataryn holds that, in British Columbia, a testator’s broad right of testamentary freedom is constrained by, but only to the extent of, the specific obligation imposed by the British Columbia legislature on testators to provide what is “adequate, just and equitable in the circumstances” for the testator’s wife, husband or children after the testator’s death. 

[36]       Even when required to enforce a statutory requirement of this kind, Tataryn instructs, at pp. 823-24, that the courts should be cautious in interfering with a testator’s testamentary freedom:

In many cases, there will be a number of ways of dividing the assets which are adequate, just and equitable.  In other words, there will be a wide range of options, any of which might be considered appropriate in the circumstances. Provided that the testator has chosen an option within this range, the will should not be disturbed.  Only where the testator has chosen an option which falls below his or her obligations as defined by reference to legal and moral norms, should the court make an order which achieves the justice the testator failed to achieve.  In the absence of other evidence a will should be seen as reflecting the means chosen by the testator to meet his legitimate concerns and provide for an ordered administration and distribution of his estate in the best interests of the persons and institutions closest to him.  It is the exercise by the testator of his freedom to dispose of his property and is to be interfered with not lightly but only in so far as the statute requires. [Emphasis added.]

[37]       I note at this point that, unlike the legislation addressed in Tataryn, in Ontario there is no statutory duty on a competent testator to provide in her will for an adult, independent child, whether based on an overriding concept of a parent’s alleged moral obligation to provide on death for her children or otherwise: see Verch Estate v. Weckwerth, 2013 ONSC 3018, at paras. 43–44, aff’d 2014 ONCA 338, at paras. 5-6, leave to appeal to S.C.C. refused, [2014] S.C.C.A. No. 288.  Adult independent children are not entitled to dependant’s relief protection under the SLRA because they do not meet the definition of “dependant” under that statute.  Ontario law accords testators the freedom to exclude children who are not dependants from their estate distribution.

[38]       Notwithstanding the robust nature of the principle of testamentary freedom and its salutary social interest dimensions, the courts have recognized that it is not an absolute right.  Apart from limits imposed by legislation, it may also be constrained by public policy considerations in some circumstances.

[39]       Canada Trust is instructive in this regard.  Canada Trust involved a charitable trust, established in 1923, that provided educational scholarships.  By the express terms of the trust instrument, both the eligibility of students to receive scholarships and that of educational institutions to serve as places of study for scholarship students were subject to overt discriminatory conditions based on race, religion and gender.  For example, the terms of the trust stipulated that the scholarships were available only to white, Protestant, British subjects and that no more than 25 percent of the scholarship funds could be allocated annually to female students.

[40]       The trusts operated in conformity with these conditions for about 65 years.  However, when the Ontario Human Rights Commission challenged the trust in the 1980s, the trustees sought directions from the court as to the trust’s validity.  The issues before the court were whether the terms of the trust were contrary to public policy and, if so, whether the trust law cy-près doctrine could be applied to preserve the trust.  In the Supreme Court of Ontario, the trust was upheld in its entirety.  On appeal to this court, this decision was reversed unanimously.

[41]       Justice Robins of this court, Osler J. (ad hoc) concurring, took account of the Supreme Court of Canada’s admonition in Re Millar, [1938] S.C.R. 1, at p. 7, that public policy “should be invoked only in clear cases, in which harm to the public is substantially incontestable, and does not depend on the idiosyncratic inferences of a few judicial minds”.  He noted the public or quasi-public nature of the trust and held that there are cases “where the interests of society require the court’s intervention on the grounds of public policy” (at p. 495).  In Robins J.A.’s view, the terms of the trust were antithetical to Canadian values and its continued operation was against the public interest. He reasoned, at p. 496:

The settlor’s freedom to dispose of his property through the creation of a charitable trust fashioned along these [discriminatory] lines must give way to current principles of public policy under which all races and religions are to be treated on a footing of equality and accorded equal regard and equal respect.

[42]       Justice Robins explained that the foundation for the court’s intervention on public policy grounds rested on the unique terms of the trust. He emphasized, at pp. 496-97, that the trust was valid and not contrary to public policy when created in 1923.  However, with changing social attitudes, public policy had also changed.  As a result, the continuation of the trust as originally contemplated was no longer in the community interest. Rather, it had become “impracticable to carry it on in the manner originally planned by the settlor”.

[43]       Justice Robins was satisfied that the settlor of the trust intended the whole of the trust property to be devoted to the educational purpose of the charitable trust.  In these circumstances, in his view, the trust should not fail.  Instead, it was appropriate to apply the cy-près doctrine and to invoke the court’s inherent jurisdiction to bring the trust into conformity with public policy so that the settlor’s general charitable trust intent to advance education or leadership through education could be continued.  Consequently, he struck the offending conditions of the trust indenture, leaving the charitable trust intact and the trust administrators to carry on the trust without regard to its original discriminatory stipulations.

[44]       In his separate, concurring reasons, Tarnopolsky J.A. also concluded that the discriminatory trust provisions were void as contravening public policy.  He, too, at pp. 514-15, endorsed the proposition that, as “[i]mportant as it is to permit individuals to dispose of their property as they see fit, it cannot be an absolute right.” 

[45]       Importantly, Tarnopolsky J.A. also stressed the distinction between private trusts and public charitable trusts.  He stated, at p. 515:

A finding that a charitable trust is void as against public policy would not have the far-reaching effects on testamentary freedom which some have anticipated.  This decision does not affect private, family trusts.  By that I mean that it does not affect testamentary dispositions or outright gifts that are not also charitable trusts. … It is [the] public nature of charitable trusts which attracts the requirement that they conform to the public policy against discrimination.  Only where the trust is a public one devoted to charity will restrictions that are contrary to the public policy of equality render it void.    [Emphasis added.]

[46]       Thus, Tarnopolsky J.A. viewed the public nature of the charitable trust as central to the determination whether interference with testamentary freedom was warranted on public policy grounds in light of the explicit discriminatory provisions of the trust indenture.  In the end, like the majority, he agreed that the charitable trust should not fail, that the trust could be applied under the doctrine of cy-près, and that the offending discriminatory provisions should be deleted from the trust instrument.

[47]       The scope of testamentary freedom and the court’s role in limiting that freedom in light of Tataryn and Canada Trust are central issues in this case.

[48]       BMO Trust submits that Eric’s gift of the residue of his estate and his disinheritance of Verolin are unambiguous, unequivocal and unconditional and that clause 5(h) – the ‘disinheritance clause’ of the Will – contains none of the unsavoury or patently discriminatory provisions of the type at issue in Canada Trust.  Additionally, Eric’s bequest of the residue of his estate is of a private, rather than a public, nature.  In these circumstances, BMO Trust says, the application judge erred by unjustifiably interfering with Eric’s testamentary freedom in circumstances where Verolin and A.S. have no legal right to share in Eric’s estate.

[49]       Verolin and A.S. counter that the courts have jurisdiction to assess whether testamentary bequests should be set aside as offending public policy.  They contend that there was admissible evidence before the application judge establishing that Eric’s motive for disinheriting Verolin and benefiting Donna and her sons was racist.  Since racial equality is firmly embedded in the public policy of Canada and the destructive force of racism is contrary to Canadian public policy, the application judge did not err in setting aside the Will on grounds of public policy.

[50]       I turn now to consideration of these arguments. 

(3)      Unavailability of a Public Policy-Based Inquiry

     Regarding the Validity of the Will

[51]       Three factual aspects of this case are especially significant.  First, as I have already emphasized, under Ontario law Verolin and A.S. have no legal entitlement to share in Eric’s estate.  This is not a case like Tataryn, where a statutory constraint on a testator’s testamentary freedom is in play.  In order to share in her father’s estate, Verolin must succeed in setting aside the Will.

[52]       Second, this is not a wills construction case.  The terms of the Will gifting the residue of Eric’s estate to Donna and her sons and disinheriting Verolin are unequivocal and unambiguous.  No interpretive question arises concerning the meaning of the Will. 

[53]       Third, unlike Canada Trust, the Will imposes no conditions that offend public policy.  It provides unconditionally for the distribution of the residue of Eric’s estate to Donna and her sons and states, at clause 5(h), that no provision was made for Verolin because “she has had no communication with me for several years and has shown no interest in me as a father”.  Although this may reflect the sentiments of a disgruntled or bitter father, it is not the language of racial discrimination.  The application judge held that clause 5(h) of the Will “does not, on its face, offend public policy”.  I agree, and would add that the same may also be said of clause 5(f) of the Will, the residual bequest provision.

[54]       In these circumstances, was a public policy-based inquiry regarding the validity of Eric’s Will available?  Was judicial interference with his testamentary freedom warranted?  I conclude that they were not, for the following reasons.   

[55]       The fact that Eric’s residual bequest imposes no conditions or stipulations is significant.  The courts have recognized various categories of cases where public policy may be invoked to void a conditional testamentary gift.  These include cases involving: i) conditions in restraint of marriage and those that interfere with marital relationships, e.g., conditional bequests that seek to induce celibacy or the separation of married couples;[3] ii) conditions that interfere with the discharge of parental duties and undermine the parent-child relationship by disinheriting children if they live with a named parent;[4] iii) conditions that disinherit a beneficiary if she takes steps to change her membership in a designated church or her other religious faith or affiliation;[5] and iv) conditions that incite a beneficiary to commit a crime or to do any act prohibited by law.[6] 

[56]       The pivotal feature of these cases is that the conditions at issue required a beneficiary to act in a manner contrary to law or public policy in order to inherit under the will, or obliged the executors or trustees of the will to act in a manner contrary to law or public policy in order to implement the testator’s intentions.  In these circumstances, the courts will intervene to void the offending testamentary conditions on public policy grounds.

[57]       In this case, however, no such condition appears in Eric’s Will.  Eric’s residual beneficiaries are not obliged to act in a manner contrary to law or public policy in order to inherit the residue of his estate.  Nor is BMO Trust required to act in a manner contrary to law or public policy in order to implement Eric’s intentions.  This case, therefore, is markedly different from those in which judicial interference with a testator’s wishes has been justified on public policy grounds.

[58]       Verolin and A.S. rely heavily on the recent decision of the New Brunswick Court of Queen’s Bench in McCorkill v. McCorkill Estate, 2014 NBQB 148, aff’d 2015 NBCA 50, leave to appeal to S.C.C. requested, to argue, in effect, that the courts have overarching authority to examine the validity of a testamentary residual bequest on public policy grounds.  On their argument, this authority extends to cases where the terms of the bequest do not include discriminatory conditions but evidence is tendered that a testator’s alleged motive in making the bequest offends public policy.  I see no support in the established jurisprudence for the acceptance of such an open-ended invitation to enlarge the scope of the public policy doctrine in estates cases.

[59]       In McCorkill, the testator left the residue of his estate to the National Alliance, a neo-Nazi organization in the United States.  The testator’s sister, supported by numerous interveners, challenged the validity of the will, arguing that the residual bequest was void as “illegal and/or contrary to public policy”.  The executor and another intervener defended the bequest.  They argued that only facially repugnant testamentary conditions could be set aside on public policy grounds and that the nature or quality of the intended beneficiary was irrelevant. 

[60]       The application judge disagreed.  In his view, the ‘worthiness’ of the residual beneficiary was a central consideration.  On the basis of extensive extrinsic evidence regarding the residual beneficiary, much of it generated by the beneficiary itself, he held, at para. 75, that the National Alliance’s entire purpose was contrary to the public policy of Canada because it stood for “anti-Semitism, eugenics, discrimination, racism and white supremacy”.  The effect of the testator’s gift to such an organization was to finance hate crimes, contrary to s. 319 of the Criminal Code of Canada, R.S.C. 1985, c. C-46 and Canadian human rights legislation and international commitments.  As a result, the application judge held, at para. 89, that voiding the gift was justified on the ground of illegality, as well as public policy, because the beneficiary’s “raison d’être is contrary to public policy”.  In so holding, the application judge expressly accepted that voiding the residual bequest based “on the character of the beneficiary is, and will continue to be, an unusual remedy”.  

[61]       The Court of Appeal for New Brunswick, in brief reasons, upheld the application judge’s ruling, stating that it was “in substantial agreement with the essential features” of his reasons: Canadian Association for Free Expression v. Streed, 2015 NBCA 50, at para. 1.[7]

[62]       The decision in McCorkill is significant in at least two respects.  First, prior to McCorkill, public policy-based justification for judicial interference with a testator’s freedom to dispose of her property had been advanced only in respect of conditional testamentary gifts.  InMcCorkill, as in this case, the testator’s residual gift was absolute, not conditional.

[63]       Second, before McCorkill, Canadian law recognized two kinds of “unworthy heirs”: i) beneficiaries who claimed entitlement to a testator’s property after having killed the testator; and ii) terrorist groups who, contrary to ss. 83.02 and 83.03 of the Criminal Code, sought to benefit from a testator’s financial support.  McCorkill, however, recognizes a third kind of “unworthy heir”: a beneficiary whose self-declared reasons for existence involve activities that constitute offences under Canadian criminal law and run contrary to Canadian public policy against discrimination.

[64]       McCorkill has been the subject of academic scrutiny and some criticism.  Professor Bruce Ziff, in an article entitled “Welcome the Newest Unworthy Heir” (2014) 1 E.T.R. (4th) 76, argues that McCorkill is but the latest judicial attempt “to find the proper demarcation between acceptable and intolerable discriminatory private conduct”. He suggests that the extension of public policy to void absolute gifts is warranted in certain circumstances, e.g. when, as in McCorkill, it would be illegal to donate money to an unworthy heir because of its status as a hate organization. 

[65]       However, Professor Ziff also acknowledges that, even in unworthy heir cases like McCorkill, the invocation of public policy considerations to void an unconditional testamentary bequest may overreach the proper ambit of the public policy doctrine.  He observes:

The more challenging problem with McCorkill is that it may be overbroad.  That is so because this gift, uniquely, was invalidated even though it involved an unqualified and absolute transfer of legal and beneficial title.  As noted above, all previous cases in which the doctrine of public policy was applied involved terms embedded in the granting document.

Fixing on such stipulations is important for several reasons.  Such terms expressly recite the discriminatory preferences and thereby provide cogent proof of the predilection.  The stipulations also give the stated preferences teeth, for failure to comply can have legal consequences.  Moreover, as an incidental effect, a focus on such stated terms will necessarily limit the number of cases in which challenges can be brought; the litigation floodgates do not open. [Emphasis added.]

I agree.

[66]       In this case, relying on McCorkill, the application judge held, at para. 44, that notwithstanding the clear terms of the Will, “the matter bears further scrutiny”.  She went on to conclude, at para. 49, that in view of the Extrinsic Evidence, Eric’s motive for disinheriting Verolin was based “on a clearly stated racist principle” that violated public policy as well as “human sensibilities”.

[67]       With respect, the application judge’s reliance on McCorkill for this purpose was misplaced.  McCorkill must be understood in the context of its unique factual circumstances.  In McCorkill, the implementation of the testator’s intentions would have facilitated the financing of hate crimes, contrary to Canada’s criminal and human rights laws, by funding an organization dedicated to such illegal and discriminatory ends – an unworthy heir.  In contrast, nothing in this case indicates that Eric’s residual beneficiaries are unworthy heirs, or that they would use their bequest for purposes contrary to law. Verolin and A.S. do not suggest otherwise.

[68]       Further, I underscore that the Will does not require BMO Trust to engage in discriminatory or unlawful conduct in order to carry out Eric’s testamentary intentions.  In Canada Trust, this court’s interference with the settlor’s right to dispose of his property as he saw fit was triggered by blatantly discriminatory conditions in the trust indenture that required the trust administrators, in carrying out the settlor’s intentions concerning the operation of a public charitable trust, to engage in discriminatory conduct in the selection of scholarship candidates and eligible academic institutions.  It was this requirement for discriminatory action on the part of the trust administrators in the operation of a public charitable trust that triggered the public policy-based intervention of the court. 

[69]       Similarly, in Peach Estate (Re), 2009 NSSC 383, an estate trustee would have been required to take affirmative steps in violation of provincial human rights legislation in order to carry out the testator’s intentions regarding the sale of his property.  On this basis, the court held that the relevant condition in the testator’s will regarding the class of persons to whom his property might be sold was of no force or effect. 

[70]       These, and analogous cases, confirm that Canadian courts will not hesitate to intervene on the grounds of public policy where implementation of a testator’s wishes requires a testator’s executors or trustees or a named beneficiary to act in a way that collides with public policy. 

[71]       That is not this case.  Unlike Canada Trust and Peach Estate (Re), where implementing the settlor’s or testator’s intentions required discriminatory acts in contravention of public policy, carrying out Eric’s gift of the residue of his estate does not require discriminatory conduct by BMO Trust or by Donna and her sons.  Nor, in contrast to Canada Trust, does it involve the creation or operation of a public charitable trust or other public entity so as to require conformity to the public policy against discrimination.

[72]       And this leads, in my view, to a second, pertinent consideration.  As I have said, Eric’s Will does not “facially offend public policy.”  But what if it did?  Was it open to Eric to disinherit Verolin in his Will on discriminatory grounds, that is, on the express basis that the father of her son was a white man, without triggering review by the courts on the grounds of public policy?

[73]       This question lies at the very heart of Eric’s exercise of his testamentary freedom.  It must be remembered that the bequest at issue is of a private, rather than a public or quasi-public, nature.  Recall Tarnopolsky J.A.’s caution in Canada Trust, at p. 515, that it was the “public nature of charitable trusts which attracts the requirement that they conform to the public policy against discrimination”.  Here, assuming that Eric’s testamentary bequest had been facially repugnant in the sense that it disinherited Verolin for expressly stated discriminatory reasons, the bequest would nonetheless be valid as reflecting a testator’s intentional, private disposition of his property – the core aspect of testamentary freedom.

[74]       In these hypothetical circumstances, neither Ontario’s Human Rights Code, R.S.O. 1990, c. H.19 nor the Charter of Rights and Freedoms would apply to justify court interference with the testator’s intentions.  The Human Rights Code, of course, ensures that every person has a right to equal treatment with respect to services, goods and facilities without discrimination based on race and other enumerated grounds.  The Charter pertains to state action.  Neither reaches testamentary dispositions of a private nature.

[75]       Absent valid legislative provision to the contrary, the common law principle of testamentary freedom thus protects a testator’s right to unconditionally dispose of her property and to choose her beneficiaries as she wishes, even on discriminatory grounds.  To conclude otherwise would undermine the vitality of testamentary freedom and run contrary to established judicial restraint in setting aside private testamentary gifts on public policy grounds.

[76]       Verolin and A.S. rely on Fox v. Fox Estate (1996), 28 O.R. (3d) 496 (C.A.), to resist this conclusion.  I do not think that Fox assists Verolin and A.S.

[77]       The central issue in Fox was whether an executrix’s decision to disinherit a beneficiary on allegedly discriminatory grounds was against public policy.  In Fox, a testator had bequeathed his wife a 75 percent life interest and their son a 25 percent life interest in the residue of his estate.  On the wife’s death, the son was to receive the residue of the estate.  The will gave the wife, as the testator’s sole executrix, wide power to encroach on the capital of the estate for the benefit of the testator’s grandchildren.  The testator’s son had two children, both born after the testator’s death.  Also after the testator’s death, the son divorced and subsequently re-married a woman who did not share his faith (Judaism).  His mother was upset and responded by making a new will of her own in which she disinherited the son.  She later exercised her discretionary encroachment power under the testator’s will to transfer all the residue of the testator’s estate to her grandchildren – the son’s children. 

[78]       The son challenged his mother’s exercise of discretion in encroaching on the capital in this fashion, alleging, in part, that it was driven by a discriminatory purpose.  The trial judge found that, by exercising her power to encroach on the capital of the estate in favour of the grandchildren and to the exclusion of the son, the wife acted properly and within the parameters of the powers given to her under the will.

[79]       On appeal, this court dealt directly with the son’s public policy-based attack on his mother’s exercise of her discretionary encroachment power.  Justice Galligan was of the view that, on the trial judge’s findings, the only reason the wife transferred the residue of the estate to her grandchildren was to disinherit the son because he had married a gentile – a clearly discriminatory purpose.  He stated, at pp. 501-502:

It is abhorrent to contemporary community standards that disapproval of a marriage outside of one’s religious faith could justify the exercise of a trustee’s discretion.  It is now settled that it is against public policy to discriminate on grounds of race or religion.

[80]       Justice Galligan concluded, at p. 502, that the wife’s exercise of her discretion was improper and must be set aside:“[I]t would be contrary to public policy to permit a trustee effectively to disinherit the residual beneficiary because he dared to marry outside the religious faith of his mother”.

[81]       However, it was the wife’s exercise of discretion in her capacity as executrix and trustee of her late husband’s estate that attracted judicial scrutiny and condemnation.  Justice Galligan reasoned, at p. 502, that, just as public policy restrained the settlor inCanada Trust from disposing of property in a manner that required discriminatory action by the trust administrators, public policy also “prohibit[ed] a trustee from exercising her discretion for racial or religious reasons”.  He elaborated, at p. 503:

It is of course a given, assuming testamentary capacity, that a person is entitled to dispose of property by will in any fashion that he or she may wish.  The exercise of a testator’s right of disposition is not subject to supervision by the court.  But a trustee’s exercise of discretion is subject to curial control.  Admittedly, because he would not be subject to judicial supervision, [the testator] if alive, could have disinherited [his son] for reasons which would have contravened public policy. … [The testator’s wife], while acting as trustee, on the other hand is subject to judicial control and that control can and must prevent her from exercising her discretion in a fashion which offends public policy. [Emphasis added.]

[82]       In separate, concurring reasons, McKinlay and Catzman JJ.A. agreed in the result.  Justice McKinlay accepted that if the wife had exercised her discretion as executrix because of her religious bias, her exercise of discretion was unsustainable.  However, she also viewed the wife’s actions as reflecting the wife’s erroneous belief that she was free to deal with her husband’s assets as if they were her own, without regard to the terms of his will.  Because it was the obvious intent of the husband that the son have a life income from his estate and the remainder outright following his mother’s death, all the wife’s encroachments on capital constituted breaches of trust. 

[83]       Justice Catzman agreed with the latter conclusions, but disagreed that the trial judge had clearly found that the wife’s encroachment on capital was driven solely by a prohibited, discriminatory purpose.  In his opinion, the trial judge’s reasons could be read as indicating that the wife had dual purposes for the exercise of her discretion, one legitimate (concern for the financial welfare and security of her grandchildren) and one illegitimate (her displeasure with her son’s choice of spouse).  He therefore declined to dispose of the appeal on public policy grounds.

[84]       Fox is of limited application to this case. First, and most obviously, unlike Fox, this case does not involve a trustee’s exercise of discretionary authority. As stated above, Eric’s residual bequest to Donna and her sons is unconditional. Second, in Fox, the will created an entitlement; the son was entitled to a life income and, on the death of his mother, to the residue of his father’s estate. Here, Verolin and A.S. have no entitlement to any part of Eric’s estate, whether under the terms of the Will or as a matter of law.

[85]       I conclude that to apply the public policy doctrine to void an unconditional and unequivocal testamentary bequest in cases where, as here, a disappointed potential heir has been disinherited absolutely in favour of a different, worthy heir, would effect a material and unwarranted expansion of the public policy doctrine in estates law.  Absent valid legislative provision to the contrary, or legally offensive conditional terms in the will itself, the desire to guard against a testator’s unsavoury or distasteful testamentary dispositions cannot be allowed to overtake testamentary freedom. The need for a robust application of the principle of testamentary freedom is especially important, in my opinion, in the context of a testator’s central right to choose his or her residual beneficiaries.

[86]       It follows that, on the facts of this case, there was no foundation for the public policy-driven review undertaken by the application judge.  With respect, she erred by going behind the testator’s expression of his clear intentions regarding the disposition of his property. 

[87]       This conclusion is dispositive of this appeal regardless of the admissibility of the Extrinsic Evidence.  However, as the admissibility of that evidence was fully argued before this court, I will address this issue.  

(4)         Admissibility of the Extrinsic Evidence

[88]       The Extrinsic Evidence was the lynchpin of the application judge’s ruling.  Yet, in relying on it to set aside the Will, the application judge failed to consider whether it was properly admissible.  In fairness, it appears that BMO Trust may not have put the admissibility of the Extrinsic Evidence in issue before the application judge.  Regardless, its proper admission was a pre-condition to its use by the application judge.  And without the Extrinsic Evidence, there was nothing to ground the claim that Verolin’s disinheritance was racially-motivated.    

[89]       In my view, the application judge erred by admitting the Extrinsic Evidence.  I say this for the following reasons.    

[90]       As a general rule, extrinsic evidence of a testator’s intentions is not admissible when the testator’s will is clear and unambiguous on its face.  On the initial application in Rondel, reported at 2010 ONSC 3584, the court considered whether a testator really intended to revoke a previous will, despite a standard revocation clause in the will.  Affidavit evidence was tendered regarding the testator’s intentions in executing the second will.  The application judge ruled, at paras. 45-46, that the evidence was not admissible and that, absent any suggestion of a drafting error, the court could not rectify a clear and unambiguous will based on extrinsic evidence, stating that to do so would be “a significant change in the law”.  

[91]       This court upheld the application judge’s ruling, noting, at para. 23, that while “the fundamental purpose of the law of wills is to give effect to the testamentary intentions of the testator for the distribution of her estate”, the court will determine those intentions “from the words used in the will, and not from direct extrinsic evidence of intent”.  The court warned, at para. 27:

The law properly regards the direct evidence of third parties about the testator’s intentions to be inadmissible.  There would be much uncertainty and estate litigation if disappointed beneficiaries like Dr. Rondel could challenge a will based on their belief that the testator had different intentions than those manifested in the will.

[92]       There are, however, exceptions to the general rule against the admission of extrinsic evidence offered in proof of a testator’s intentions.  In Rondel, this court recognized two such exceptions.  First, direct extrinsic evidence of intention may be admissible where a will is equivocal, that is, where the words used in the will may be read as applying equally to two or more persons or things.  Second, evidence of the testator’s circumstances or the circumstances surrounding the formation of a will may also be admissible in cases where the will is or may be ambiguous.  

[93]       These exceptions are concerned with assisting in the construction of a will.  James Mackenzie expresses the principle succinctly in Feeney, The Canadian Law of Wills, loose-leaf (Rel. 40–11/2012), 4th ed. (Toronto: LexisNexis Butterworths, 2000) at 10.30: “[I]ndirect extrinsic evidence may be used as an aid in construction when the nature and effect of that evidence is to explain what the testator has written, but not what he or she intended to write.”

[94]       This is not a wills interpretation case and the application judge was not sitting as a court of construction.  Here, it is accepted that the terms of the Will are unambiguous and unequivocal.  Consequently, the established exceptions to the general exclusionary rule regarding evidence of a testator’s intentions are not engaged. 

[95]       I acknowledge that the Extrinsic Evidence may be said to be of a different character than that recognized under the established exceptions to the general exclusionary rule concerning evidence of a testator’s intentions.  As Verolin and A.S. point out, the Extrinsic Evidence bears on Verolin’s relationship with Eric and his reasons for making his testamentary dispositions of his property, rather than what testamentary dispositions he intended to make.  Precisely because it is not evidence of the testator’s intentions, but rather the testator’s motives, Verolin and A.S. argue that Rondel and other “intention cases” are irrelevant.  They contend that there is no bar to the admission of extrinsic evidence of motive seeking to establish that a testator’s reason for a testamentary bequest offends public policy, e.g. where the proffered extrinsic evidence indicates that the testator’s motive was racially-motivated. 

[96]       I think that this proposition must be soundly rejected.

[97]       It need hardly be said that public policy in Canada precludes discrimination on the basis of race and other discriminatory characteristics.  The public policy against discrimination is reflected in the Charter and the human rights legislation of every province in Canada, including Ontario’s Human Rights Code

[98]       But the desirability of affirming the public policy against discrimination does not lead to the conclusion that third-party extrinsic evidence of a testator’s alleged discriminatory motive is admissible to challenge the validity of a will where, as here, the testator’s residual bequest to a private beneficiary is absolute, unequivocal and unambiguous.  Quite the opposite.  If, as Rondel holds, extrinsic evidence is not admissible to establish what a testator intended, still less should it be admissible to question why the testator made a particular bequest. 

[99]       In Rondel, this court identified various dangers that would arise from relaxation of the general exclusionary rule regarding the admission of extrinsic evidence of a testator’s intentions.  Rondel warns, for example, that the admission of such evidence would lead to increased estates litigation and create uncertainty where uncertainty does not otherwise exist.

[100]    The same concerns arise regarding extrinsic evidence of a testator’s alleged motive in disposing of her property.  As with evidence of a testator’s intentions, where the testator’s wishes are neither ambiguous nor equivocal, the admission of third-party extrinsic evidence about a testator’s alleged motive would undercut faithful implementation of a testator’s intentions as expressed in her written will.  It would also encourage disappointed beneficiaries to seek an estate distribution different from that intended by the testator based on extrinsic evidence of alleged improper motive by the testator, thereby fostering unnecessary litigation and leading inevitably to confusion, uncertainty  and indeterminacy in estates law. Where possible, such mischief must be avoided.

[101]    Rondel also cautions that third-party evidence of a testator’s intentions gives rise to both credibility and reliability issues.  As Juriansz J.A. explained, at para. 37, credibility issues arise “because would-be beneficiaries can, without fear of contradiction by the deceased, exaggerate their relationship and fabricate the promises of bequests”.  Reliability issues arise “because testators are not obliged to write their wills to accord with the sincere or mendacious assurances they may have given to those close to them”.  Thus, the evidence of third parties, “who cannot directly discern the mind of the testator, is logically incapable of directly proving the testator’s intent”.

[102]    These comments are apposite to third-party evidence of a testator’s motive.  Consider that would-be beneficiaries can, without opportunity for rebuttal by the testator, exaggerate or fabricate the testator’s predilections or utterances and conduct during life in an effort to ground a discriminatory motive claim.  Just as a would-be beneficiary cannot “directly discern” the intentions of a testator, so too is a would-be beneficiary unequipped to “directly discern” a testator’s true motive in making  a particular bequest.  The law does not require a testator to explain, let alone to defend, her reasons for her testamentary dispositions.  Indeed, in my view, the privacy of those reasons is inherent in the principle of testamentary freedom.

[103]    Nor do the applicable authorities support the admission of third-party evidence of a testator’s motive for the purposes urged here.  In Fox, the testator’s motive was not in issue.  Only the wife’s motive in exercising her encroachment discretion was relevant to whether she had improperly exercised her discretion and failed to discharge her obligations as trustee.    

[104]    Moreover, I do not read McCorkill as endorsing the admission of third-party evidence of a testator’s alleged motive to support a public policy-based attack on a testator’s will.  Although extensive extrinsic evidence was admitted and considered by the McCorkillcourt, it was not directed at the testator’s motive in naming the National Alliance as his residual beneficiary.  Rather, it bore on the nature of the National Alliance organization and its communications and activities in support or rebuttal of the claim that it was a known, right-wing extremist group that engaged in racist, white supremacist and hate-inspired activities.  In other words, the extrinsic evidence in McCorkill was focused on the quality of the residual beneficiary and its illegal purposes, rather than on the testator’s motive.

[105]    In these circumstances, the application judge held in McCorkill, at para. 72: “While the jurisprudence on voiding bequests on the grounds of public policy tends to deal with conditions attached to specific bequests, in my opinion the facts of this case are so strong that they render this case indistinguishable from those.”  He elaborated, at paras. 76-77:

The evidence before the court convinces me that in the case of the [National Alliance] the purpose for which it exists is to promote white supremacy through the dissemination of propaganda which incites hatred of various identifiable groups which they deem to be non-white and therefore unworthy.  Those purposes and the means they advocate to achieve them are criminal in Canada and that is what makes this bequest repugnant.

It is also what makes this situation comparable, in my view, to a gift to a trustee for a purpose that is contrary to public policy.  The law of wills is concerned with the intent of the testator and from the very fact that Mr. McCorkill left his entire estate to the [National Alliance] I infer that he intended it to be used for their clearly stated, illegal purposes. [Emphasis added.]

[106]    Thus, it was the illegality of the prospective use of the residual bequest and the unlawful nature of the residual beneficiary’s communications and activities that drove the decision in McCorkill.  These critical considerations are simply not in play here. 

[107]    Verolin and A.S. also point to Canada Trust as authority for the proposition that the courts will consider evidence of a testator’s motive when a public policy-based challenge to the testator’s disposition of property is mounted.  I disagree.    In my view, Canada Trust does not stand for this proposition.

[108]    In Canada Trust, this court took account of the recitals in the challenged trust indenture, even though they might be characterized as going only to the settlor’s motive in establishing the charitable trust, because they afforded an explicit reason for the establishment of the trust and gave meaning to its restrictive criteria: Canada Trust, at para. 35.  But the settlor’s motive was expressed in the trust indenture itself.  Evidence of motive was relevant in Canada Trust because it formed part of the trust deed at issue. 

[109]    In this case, the Will expressly discloses Eric’s motive, at clause 5(h).  That clause provides an explanation, from the testator himself, for his decision to exclude Verolin from the Will, namely, that “she has had no communication with me for several years and has shown no interest in me as her father”.

[110]    Viewed in this fashion, the purpose of the Extrinsic Evidence was not to establish Eric’s motive for the residual bequest in his Will but, rather, to contradict the lawful motive for the bequest disclosed by the plain language of the Will and to substitute, in its stead, a different and allegedly unlawful motive.  I see no basis at law for the admission of wholly contradictory, extrinsic evidence of motive for this purpose.  In my view, the courts should be loath to sanction such an indirect attack, which the deceased cannot challenge, on a testator’s expressed motive and testamentary choices.

[111]    As I have indicated in these reasons, the scope for judicial interference with a testator’s private testamentary dispositions is limited.  So, too, is the reach of the public policy doctrine in estates cases.  And for good reason.  The court’s power to interfere with a testator’s testamentary freedom on public policy grounds does not justify intervention simply because the court may regard the testator’s testamentary choices as distasteful, offensive, vengeful or small-minded.  As the court observed in Thorsnes v. Ortigoza, 2003 MBQB 127, 174 Man. R. (2d) 274, at para. 14, “a person has the right, subject to fulfilling specific legal obligations to dependants, to dispose of his or her estate in an absurd or capricious manner, whatever others may think of the fairness or reasonableness of the dispositions”. 

[112]    The application judge’s decision in this case implicitly endorses a general supervisory role for the courts in policing a testator’s unqualified and legitimate choice of her heirs on the ground of enforcing the public policy against discrimination.  This proposition, if accepted, would significantly erode and arguably displace meaningful testamentary freedom.

(5)         Other Grounds of Appeal

[113]    I have concluded that the application judge erred by embarking on a public policy-based review of the impugned terms of Eric’s Will and that she further erred by admitting the Extrinsic Evidence tendered in this case.  It follows that I would allow the appeal.  As a result, I do not reach BMO Trust’s other grounds of appeal.

IV.     Disposition

[114]    For the reasons given, I would allow the appeal.

[115]    At the appeal hearing, the parties informed the court of their agreement that the parties’ costs should be paid out of Eric’s estate.  The court was also informed that the value of the estate is slightly less than $400,000, that the parties’ costs of the proceeding before the application judge, which were also ordered to be paid by the estate, totalled approximately $31,500, and that the parties’ claimed costs of the appeal total about $71,000.  Accordingly, payment by the estate of all awarded or claimed costs associated with this litigation, including the costs of the appeal, would reduce the value of Eric’s estate by approximately 25 percent.

[116]    In these circumstances, the court would benefit from further written submissions by the parties regarding the costs of the appeal, including with respect to the relevance in this case of this court’s decision in McDougald Estate v. Gooderham (2005), 255 D.L.R. (4th) 435.  BMO Trust shall deliver its brief written costs submissions by March 24, 2016 and Verolin and A.S. shall deliver their responding brief submissions by April 8, 2016, to the Registrar of this court.


“MAR -8 2016”                                    “E.A. Cronk J.A.”

“EAC”                                                “I agree K. van Rensburg J.A.”

Lauwers J.A. (Concurring):             

[117]    I agree with my colleague that the appeal should be allowed for the reasons she gives, which I wish to supplement briefly.

[118]    The respondents submit that public policy supports the decision under appeal on the basis that: “equality of the races forms part of the public policy of Canada,” and cite in support particularly s.15 of the Canadian Charter of Rights and Freedoms, and s.1 of theHuman Rights Code.

[119]    In this case the respondents ask this court to expand the public policy exception to testamentary freedom, by subjecting Mr. Spence’s will to the test of whether it is discriminatory in its motivation or intention, because there was no bequest to Verolin.

[120]    Would such a judicial move by this court be warranted? In my view, it would not, for two basic reasons.

[121]    I begin with the “slippery slope” argument, not because it is the most important reason for refusing to create a new public policy exception, but because it shows the full scope of the respondents’ proposal.

[122]    Although the respondents expressly confine their submissions to racist motivations and intentions, there is no logical reason to limit the reach of the proposed new exception to racial discrimination alone. The true scope and extent of this proposed expansion of the public policy exception is much larger. 

[123]    There is therefore considerable merit in BMO Trust Company’s argument that allowing the application judge’s decision to stand would increase uncertainty in estates law and open the litigation floodgates. The respondents’ proposal would greatly extend both the court’s jurisdiction and its burden, and would disrupt estates law, which now functions smoothly to pass property from one generation to the next.

[124]    Second, I address the proposed extension of the public policy exception to testamentary freedom as a matter of principle. There is no law in Ontario that entitles Verolin to share in her father’s estate. No law has deprived her of any right. The Charter value of equality that she asserts does not afford her such an entitlement. Ontario could choose to legislate to give effect to the value of equality in estates, but it has not done so.

[125]    In that regard, it is instructive to recall that the Charter exists to control the activities of government, as provided in s. 32, in order to protect personal autonomy and freedom from governmental activities. The Charter does not reach or seek to affect the private conduct of individuals in their relations with each other. See Dolphin Delivery Ltd. v. R.W.D.S.U., Local 580, [1986] 2 S.C.R. 573, at pp. 598-99. 

[126]    Similarly, the reach of the Code is limited. The Code does not regulate the actions of individuals unless they are supplying “services, goods [or] facilities” as provided in s.1, or “accommodation” under s.2, in the market. Individuals are otherwise free to hold and to act on their prejudices, however unsavoury, so long as they do not breach the criminal law. The Code obliges them to act rightly only in the market, whatever their private thoughts might be. Putting it differently, it is not the Code’s purpose to force people to think and act rightly everywhere and at all times.

[127]    Finally, I address Mr. Cherniak’s submission that a Charter hook is available under s.32 as a means for this court to interfere with Mr. Spence’s will. He argues that by probating Mr. Spence’s will under the Estates Act, R.S.O. 1990 c. E.21, the court is a state actor, and is therefore obliged to expand the public policy exception to testamentary freedom in accordance with Charter values.

[128]    I reject this submission for two reasons. First, what is being attacked is Mr. Spence’s will, which is a quintessentially private act of personal expression. There is no doubt that Mr. Spence’s act is not itself state action caught by the Charter or the Code, neither of which interferes with the bequests of testators.

[129]    Second, in probating Mr. Spence’s will there is no state action that engages the Charter in the relevant sense. The court’s jurisdiction in matters of probate in Ontario is narrow, as described by Cullity J. in Otis v. Otis, [2004] O.J. No. 1732. The basic probate question is whether the will itself is formally valid, the testator was of sound mind, and the will was not made in suspicious circumstances. In probating a will the court is not concerned about the validity of specific bequests and does not require proof that bequests in a valid will are non-discriminatory. The court neither condones nor approves of particular bequests.

[130]    For these concurring reasons, in addition to those advanced by my colleague, I would allow the appeal.

“P. Lauwers J.A.”

[1] On March 25, 2015, Huscroft J.A. of this court, sitting in chambers, approved the Office of the Children’s Lawyer’s (the “OCL’s”) abandonment of its appeal from the application judge’s decision. The OCL did not participate in this appeal.

[2] The Wills Variation Act has since been replaced in British Columbia by the Wills, Estates and Succession Act, S.B.C. 2009, c. 13.  Section 60 of that statute affords the courts the same authority as previously set out in s. 2(1) of the Wills Variation Act.

[3] See Waters’ Law of Trusts in Canada, 4th ed. (Toronto: Carswell 2012) at pp. 335, 338.

[4] See for example, Re Thorne (1922), 22 O.W.N. 28 (H.C.); Waters’ Law of Trusts in Canada, at p. 341

[5] See Murley Estate v. Murley (1995), 130 Nfld. & P.E.I.R. 271 (S.C. (T.D.)).  These cases must be contrasted to those involving charitable bequests that simply restrict the class of eligible beneficiaries to members of a particular religious faith.  Cases in the latter category have been held not to offend public policy: see for example, University of Victoria Foundation v. British Columbia, 2000 BCSC 445; Ramsden Estate, Re (1996), 139 D.L.R. (4th) 746 (P.E.I. T.D.) (In Chambers).

[6] Re Elliot, [1952] Ch. 217; Francis Barrow et al., ed., Williams on Wills, 9th ed., vol. 1 (London, UK: LexisNexis Butterworths, 2002), at 34.12.

[7] As at the date of these reasons, the leave application to the S.C.C. in McCorkill remains pending.