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Estate Law, Evidence, Hearsay

Relying on Statements of a Deceased Person in Estate Claims

Hearsay evidence often plays an important role in BC estate litigation. We recently discussed Simard v. Simard Estate, 2021 BCSC 1836, a case in which siblings disputed the transfer of property and assets from their mother to their sister. See that blog post here. If the transfers stood, three of four siblings would essentially be disinherited. The transfers were made during the mother’s lifetime, but the legal challenge did not arise until after the mother’s death. The critical question in cases such as this is the parent’s intention at the time the transfer was made. Did the parent intend to transfer the property or asset as a gift? The difficultly in answering the question is that the parent is no longer alive to give evidence about their intention.

Did the parent intend to make gifts to only one of her children?

In Simard Estate, the mother transferred title to several pieces of property to Julie, one of her four adult children. The mother also added Julie’s name as a joint account holder on all of her bank accounts and investments. When the mother died, her three other children argued that the accounts and properties were held by Julie on resulting trust for their mother’s estate, and should be divided equally among all four of them in accordance with their mother’s will. Julie argued that their mother intended to gift the right of survivorship to her, so that the accounts and properties became Julie’s on their mother’s death and not part of their mother’s estate. Most of the evidence about what the mother allegedly said or expressed regarding her intention when the transfers were made was hearsay. Family, friends, and professionals such as lawyers and investment advisors who interacted with the deceased could relay what the deceased told them about her intention. But could those statements be admitted as evidence and relied on by the Court?

Hearsay may be necessary evidence

Hearsay evidence is an-out-of-court statement relied on for its truth. It is presumptively inadmissible. The concern with admitting hearsay evidence is the inability to test the out-of-court statement through cross-examination. Statements of a deceased person may be admitted into evidence pursuant to the principled exception to the hearsay rule. The principled exception allows for the admission of hearsay evidence if it meets two criteria: (1) necessity and (2) reliability. The onus is on the party seeking to rely on the hearsay evidence to establish necessary and reliability on a balance of probabilities. In the Simard Estate litigation, the mother’s death established the necessity criterion. The more difficult issue was the reliability of various statements or expressions of intention attributed to the mother. Hearsay evidence was tendered by both sides to the dispute (Julie as the defendant, her three siblings as the plaintiffs). Most of the hearsay evidence regarding the mother’s intentions involved testimony about what she “wanted” or what her wishes were, rather than what she actually said and in what circumstances. This made the hearsay evidence problematic as it was completely devoid of context.

Assessing reliability of statements attributed to a deceased person

As the BC Court explained in Simard Estate, there are two aspects to assessing reliability. First is “threshold reliability” (i.e., should the out-of-court statement be admitted). If threshold reliability is established, the second consideration is “ultimate reliability” (i.e., whether and to what degree the statement should be believed and relied on to decide issues in the case). As a preliminary issue, the court must first find on a balance of probabilities that the statement was made by the deceased before it goes on to determine the treatment and weight of such evidence. At that stage, the Court should all relevant consider factors such as the presence or absence of a motive to lie; alternative—even speculative—explanations for the statement; independent corroborative evidence; the timing of the statement relevant to the event; the deceased person’s mental capacity at the time of making the statement; and the solemnity of the occasion when the statement was made (e.g., to a lawyer when preparing a will; when executing bank documents).

Defence witnesses not credible

While the Court should consider all relevant factors, in large part the assessment will turn on the credibility of the other witnesses. Lack of credibility was what sank Julie’s case in the Simard Estate litigation. The Court found that Julie and her witnesses gave self-serving, unconvincing evidence that was inconsistent with evidence proffered by the other siblings and family members. Julie’s hearsay evidence was also inconsistent with the independent evidence that was before the Court. Clinical records from the mother’s hospital stay around the time of the transfers were in evidence; they contained notes of statements the mother made that went to the issues of her mental capacity and her intentions. Also in evidence were notes taken by the mother’s investment advisor during meetings when the accounts were opened. That objective evidence, recorded by people with no interest in the outcome of the litigation, was given considerable weight in testing the reliability of the hearsay statements attributed to the mother. It did not align with Julie’s version of events, providing support for the disinherited siblings’ claim that their mother did not intend to essentially disinherit the plaintiffs when she put the property and assets into Julie’s name.

Bottom line on hearsay evidence of a deceased person

In BC estate litigate claims involving disputes about the presumption of resulting trust, statements of a deceased person may be admitted into evidence as an exception to the usual rule that hearsay is not admissible. Hearsay evidence may be admitted, but entitled to very little weight—for example, where it does not accord with bank documents or other written records, is provided by a self-interested witness, or is inconsistent with more credible evidence from other independent witnesses.