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BC Estate Litigation Arises from Suspicious Marriage and Missing Gold Coins

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  • BC Estate Litigation Arises from Suspicious Marriage and Missing Gold Coins

BC estate litigation arising from predatory marriage is not uncommon and may become more common as the BC population ages. Elderly people are often targeted by predators looking to get control over finances or property or to gain access to the estate. A marriage entered into for the sole purpose of exploiting or taking advantage of an elderly or otherwise vulnerable individual (for example, due to cognitive impairments) is known as a “predatory marriage” and, as our BC estate litigation lawyers have previously discussed, such marriages may be set aside due to lack of capacity to enter the marriage.

BC estate litigation against an allegedly predatory spouse  

In addition to challenging the validity of the marriage itself, beneficiaries or estate executors can challenge suspicious transfers of property or questionable actions of a widowed spouse. For example, the BC estate executor in Fox Estate v. Sevilla-Blanco, 2020 BCSC 497 commenced court proceedings against a California resident named Lorena Sevilla-Blanco, who married a man one day before his death in December 2016. In the proceedings, the executor alleged that Ms. Sevilla-Blanco took valuable gold coins belonging to the deceased’s BC estate and converted them to her own use.

Marriage took place one day before death of testator

The relationship between the deceased and Ms. Sevilla-Blanco began in 2014 as a business relationship but it eventually became romantic. The deceased entered the hospital after suffering a heart attack in late November or early December 2016. While in the hospital the deceased and Ms. Sevilla-Blanco decided to get married. They were married on December 9, 2016. The deceased passed away the next day. In the month after his death, Ms. Sevilla-Blanco went from California to BC to retrieve a cashier’s cheque and title documents from the deceased’s safety deposit box at the Scotia Bank in Campbell River, BC.

Estate litigation: Executor infers that widow must have removed the gold coins

There was evidence that the deceased had purchased 244 gold coins in June 2016 (about six months before he died) and put them into the safety deposit box in BC. When the BC estate executor opened the safety deposit box on July 26, 2017, the box was empty and was devoid of any gold coins. According to Ms. Sevilla-Blanco, there were no gold coins in the safety deposit box when she attended in January 2017. The missing coins had an estimated value of $438,468. The BC estate executor inferred that the widow of the deceased must have removed the coins after her husband’s death and served Ms. Sevilla-Blanco in California with a Notice of Civil Claim.

Default judgment granted against widow in BC estate litigation

Ms. Sevilla-Blanco failed to file and serve a response to the BC estate litigation claim commenced by the estate executor. On May 21, 2019, the executor took default judgment against Ms. Sevilla-Blanco and on July 17, 2019 damages were assessed to be $438,468 (the value of the gold coins) plus costs in the amount of $2,469.56. Once served with the damages order, Ms. Sevilla-Blanco hired a lawyer in BC who applied on her behalf to set aside the default judgment.

Damages order and default judgment in BC estate litigation matter set aside

After damages have been assessed, BC courts no longer have the authority to set aside a default judgment under the BC’s Supreme Court Civil Rules. However, BC courts maintain inherent jurisdiction to regulate practice and procedure so as to prevent a miscarriage of justice. Justice Hopi, writing for the BC court in the Fox Estate litigation matter, concluded that it would be a miscarriage of justice to allow the default order assessing damages to stand. Once the damages order had been set aside, it was then open to Justice Hopi to exercise the authority under the Rules to set aside the default judgment.

BC estate executor’s evidence insufficient to support default judgment  

The executor has the burden to prove her case against the alleged predatory spouse. In granting Ms. Sevilla-Blanco’s application to set aside the default judgment, Justice Hopi noted that the evidence relied upon by the BC estate executor in the Fox Estate litigation matter was insufficient to support a default judgment. The default judgment was based upon the inferences made by the BC estate executor – inferences which Justice Hopi found to be weak at best. For example, the evidence did not clearly establish how many gold coins were deposited into the safety deposit box in the first place. And even if 244 gold coins were so deposited, the deceased may have removed the gold coins himself prior to his death, as there was evidence that the deceased had accessed the box twice after the coins were purchased. In these circumstances, it was in the interests of justice to set aside the default judgment and require the BC estate executor to prove her case.

Estate awarded costs thrown away by widow’s failure to respond to claim

Justice also required that the estate of the deceased be compensated for its costs thrown away as a result of Ms. Sevilla-Blanco’s failure to respond when she was served with the Notice of Civil Claim in the BC estate litigation. Ms. Sevilla-Blanco pointed to the fact that she lives in California, speaks limited English, and had difficulty retaining a BC estate litigation lawyer. However, this was not enough to satisfy the court that Ms. Sevilla-Blanco did not wilfully or deliberately fail to respond to the Notice of Civil Claim. Her failure was tempered by the fact that she moved in a timely manner to set the default judgment aside. Ms. Sevilla-Blanco was ordered to pay the estate’s costs thrown away on a solicitor-client basis and ordered to file her response to the Notice of Civil Claim within 14 days. It remains to be seen whether the BC estate executor will be able to prove her case in relation to the missing gold coins.

Bottom line on BC estate litigation against predatory spouses

There are several legal options for BC estate executors or beneficiaries who wish to challenge the validity of a marriage, the propriety of transfers of property made to a spouse under suspect circumstances, or the questionable actions of a predatory spouse. When allegations of impropriety or wrongful conversion of property are made, the executor or beneficiary making the allegations will have the burden to prove the case.

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