Executive Summary: Key Legal and Evidentiary Issues

• Conflicting instructions in paragraph 10 of the Will created ambiguity regarding whether proceeds from the Residence sale should form part of the estate residue or be divided among grandchildren.

• The drafting solicitor acknowledged the conflicting clause was an accidental error carried over from a precedent document.

• Betty Ann Gall's disclaimer of her life estate accelerated the grandchildren's remainder interest in the Residence.

• Wylene Buchert's uncorroborated testimony regarding the Deceased's intentions was insufficient under section 11 of the Alberta Evidence Act.

• Insufficient estate funds necessitate abatement of monetary gifts under section 28 of the Estate Administration Act.

• Corporate assets belonging to LarRon's Excavating Ltd. cannot be used to satisfy estate bequests as they are not personally owned estate property.

Background and parties involved

Larry Wayne Gall passed away on August 2, 2021, leaving behind a Will dated September 26, 2018, and a codicil dated May 6, 2021. At the time of his death, he owned a residence where he lived with his spouse, Betty Ann Gall. The applicant, Wylene Lynn Buchert, is the Deceased's daughter and the sole residuary beneficiary under the Will. The respondents include Betty Ann Gall (surviving spouse), David Wiens (current Personal Representative), and the Deceased's eight grandchildren, one of whom is a minor represented by the Office of the Public Guardian and Trustee.

The conflicting will provisions

Paragraph 10 of the Will contained two contradictory instructions regarding the disposition of the Residence. One sentence directed that any residence held by the trustees "shall form part of the residue of my estate," while another sentence stated that upon the death of Betty Ann Gall, "the above noted property shall be sold and the proceeds shall be divided in equal shares between my grandchildren." This internal contradiction required the Court to determine the Deceased's true intention.

The Will also contained bequests of $25,000 to each of the eight grandchildren and $1,000 to each of the Deceased's two sons, totaling $202,000 in paragraphs 14-23. Paragraph 24 designated Wylene Buchert as the sole residuary beneficiary. The Deceased's shares in LarRon's Excavating Ltd. were bequeathed entirely to his daughter and were valued at $910,903.00 in the inventory filed in support of the application for a grant of probate.

Evidence of testamentary intent

Norman Tainsh, the solicitor who drafted the Will, provided critical evidence through his affidavit sworn October 25, 2022. He testified that the Will contained an error, explaining that he had neglected to remove the provision designating proceeds to the estate residue from a precedent he was using. His file notes documented that the Deceased instructed his assistant Patricia Fenton that upon Betty Ann Gall's death, the Residence was to be sold and divided eight ways among the grandchildren.

Betty Ann Gall testified at questioning that the Deceased had contemplated leaving the proceeds of the sale of the Residence to Wylene Buchert but then ultimately decided to leave the proceeds to his grandchildren. This contradicted Wylene Buchert's evidence that she had several conversations with the Deceased that led her to believe she was to inherit the Residence upon his death. The Court found Ms. Buchert's account uncorroborated as required under section 11 of the Alberta Evidence Act and inconsistent with other evidence in the record.

The Court's interpretation and rectification

The Court applied the principles of will interpretation under section 26 of the Wills and Succession Act and common law, finding that the Deceased intended to leave the proceeds of the sale of the Residence to his grandchildren. When read as a whole, the Will used consistent language regarding the equal division of proceeds among grandchildren in both paragraphs 10 and 12. No evidence was presented explaining an intention to treat the proceeds differently depending on whether the Deceased survived his spouse or her life interest ended after his death.

The Court exercised its power of rectification under section 39 of the Wills and Succession Act to remove from paragraph 10 the sentence: "Subject to the interest of my spouse, any residence held by my Trustees under the terms of this paragraph shall form part of the residue of my estate." The Court found the evidence of the Deceased's intention, based on a reading of the Will as a whole, the evidence of Betty Ann Gall, and the evidence of Mr. Tainsh, including his file notes, to be clear and compelling.

Acceleration of interests and abatement of gifts

Although Betty Ann Gall did not predecease the Deceased nor has she died, she disclaimed her life interest in the Residence. The Court held that when a person who is the beneficiary of a life estate disclaims that interest, unless a contrary intention is contained in the will, the subsequent interests are accelerated. Ms. Gall's disclaimer therefore accelerated the grandchildren's remainder interest in the Residence.

Given the rectification, there are insufficient assets in the estate to fund the monetary gifts of $202,000 set out in paragraphs 14-23. The Court applied section 28 of the Estate Administration Act, determining that these general gifts must abate. Any remaining shortfall is to be borne pro-rata by the specific gifts in paragraphs 10, 11, and 13, calculated based on the net value of those gifts at distribution.

Disposition of ancillary claims

Betty Ann Gall's claim for division of family property was dismissed as she did not pursue it at the hearing and the conditions precedent under section 5 of the Family Property Act did not exist—the Deceased and Ms. Gall were married and living together at the time of death. Her claims for return of a pistol and reimbursement of an electrical bill paid on behalf of LarRon were dismissed without prejudice to her ability to bring civil claims against the appropriate parties for relief, as these matters fell outside the estate action.

The Court directed the Personal Representative to provide documentary evidence within 60 days supporting assertions that certain vehicles were jointly held with Betty Ann Gall and that the RBC Dominion Securities Account had a designated beneficiary. The application to set the Personal Representative's compensation was deemed premature, but he was authorized to hold back $35,000.00 from distribution pending determination of his claim for compensation.

Ruling and outcome

The Court ruled in favor of the grandchildren regarding the proceeds from the sale of the Residence. Justice R.W. Armstrong of the Court of King's Bench of Alberta ordered paragraph 10 of the Will rectified to remove the erroneous residue clause. The proceeds from the Residence sale, amounting to $397,408.73, are to be divided equally among the eight grandchildren, subject to pro-rata abatement for any further expenses, debts, or liabilities of the estate, including the Personal Representative's compensation. The specific amounts to be contributed from each gift cannot be determined until the final accounting of the estate is complete.