Alberta Court of Appeal admits extrinsic evidence to determine testator’s subjective intent

The Alberta Court of Appeal has allowed extrinsic evidence to be used in determining the testator’s subjective intent.

Dr. Barrie Strafford executed a will before his death in Strafford Estate (Re), 2023 ABCA 99. He left one-half of his estate’s residue in equal shares to his four children and directed that the share that would be transferred to his daughter Sheree Strafford-Bliss would be used to purchase an annuity giving her a monthly income of at least $3,500.

Dr. Strafford died in April 2016, and four months later, his daughter Sheree died of a drug overdose. Sheree died before Dr. Strafford’s representative obtained a grant of probate and before they purchased the annuity referred to in the will.

Sheree’s estate applied for advice and direction from the court on interpreting the will. Sheree’s estate argued that the language of the will should be interpreted to mean that her share of the residue of her father’s estate had vested in her by the time of her death. As a result, Sheree’s estate argued that Sheree’s share should be paid to her estate.

Meanwhile, Dr. Strafford’s estate asserted that the testator intended only to provide Sheree with a guaranteed income stream during her lifetime to be offered by way of annuity. The estate argued that Sheree’s death brought her interest in the annuity to an end and disputed that Sheree’s estate is entitled to receive anything from Dr. Strafford’s estate.

During the trial, the parties presented evidence of the strained relationship between Dr. Strafford and his daughter Sheree because of her substance dependency, inability to maintain employment, and financial mismanagement.

The trial judge found that the testator’s intention “was to provide Ms. Strafford-Bliss with only an income during her lifetime. The Strafford-Bliss Estate is not entitled to the sum that would have purchased an annuity for Ms. Strafford-Bliss.” The judge explained that it was the testator’s subjective intention to prevent Sheree from receiving a lump sum amount from his estate due to his concerns about her financial mismanagement, among other things.

Dr. Strafford’s estate raised the matter to the Alberta Court of Appeal, arguing that the trial judge rectified the will in a manner that did not comply with the Wills and Succession Act. The estate also argued that the trial judge failed to apply the presumption of early vesting.

The appeal court noted that in determining a testator’s subjective intention, the court could intervene if the will’s interpretation demonstrates palpable and overriding error, absent an extricable error of law which is then subject to a correctness standard.

The appeal court, citing jurisprudence, explained that a will must be interpreted to give effect to the subjective intention of the testator. The court further said that extrinsic evidence is admissible to ascertain the testator’s intent. Its admissibility does not depend on a finding that a word could mean more than one thing, or an ambiguity exists.

The court ruled that the trial judge properly considered extrinsic evidence to ascertain and give effect to the testator’s subjective intention. The court further said that the judge did not commit any palpable and overriding errors in finding that the testator intended to treat Sheree differently from his other children.

The court concluded that ample evidentiary records support the trial judge’s ruling that the testator intended for the annuity to be non-commutable and non-assignable.