In this recent decision, Dagg v. Cameron Estate, of the Ontario Superior Court, the Honourable Mr. Justice Bale discussed whether a child who had not been born at the time of his father’s death and/or the mother of that child were entitled to dependant support from the father’s estate.
Section 58 of the Succession Law Reform Act (“SLRA”) enables the dependant of a deceased person to bring an application for support if the deceased person has not, through his or her will (or through intestacy) made adequate provision for the dependant. A “dependant” includes the spouse of the deceased and the child of a deceased to whom the deceased was providing support, or was under a legal obligation to provide support, immediately before his or her death.
When Stephen Cameron died of cancer, he left behind a surviving partner, Evangeline Dagg, who was eight months pregnant. Although they were not legally married, they had been in a committed, conjugal relationship for several years and intended to marry. Stephen’s will named Evangeline as his sole beneficiary, but his only significant asset at the time of his death was a $1 million life insurance policy.
Prior to Stephen’s relationship with Evangeline, he had been married for eight years to Anastasia Cameron, with whom he had two children, both minors. At the time of his death, Stephen and Anastasia were still legally married and in the midst of divorce proceedings. Anastasia had obtained a temporary court order on consent which required Stephen to “maintain Anastasia as irrevocable beneficiary on any life insurance policy” as security for his child and spousal support obligations.
Stephen initially complied with the order, but after his terminal cancer diagnosis, he changed the designation of his insurance policy, leaving Evangeline 53.6 percent and the remaining balance to Anastasia and her children. Anastasia found out about the change and obtained a court order requiring Stephen to switch it back.
One week later, Stephen died. His son, James, was born shortly thereafter. Evangeline commenced an application for dependant support under the SLRA on behalf of her and James. Anastasia opposed the application on the grounds that Evangeline was not a “dependant” as defined in the SLRA, and that even if she were, the proceeds of Stephen’s life insurance policy should be excluded from any dependant support claims. This decision dealt with a motion brought by Evangeline for interim support pending final resolution of the application.
Meaning of “Spouse” under the SLRA
Anastasia’s main arguments centred upon the definition of “spouse” in the SLRA and, in particular, the fact that James wasn’t born until after Stephen’s death. The SLRA defines “spouse,” for the purposes of dependant support, as follows:
“spouse” means a spouse as defined in subsection 1 (1) and in addition includes either of two persons who,
(a) were married to each other by a marriage that was terminated or declared a nullity, or
(b) are not married to each other and have cohabited,
(i) continuously for a period of not less than three years, or
(ii) in a relationship of some permanence, if they are the natural or adoptive parents of a child. (“conjoint”) R.S.O. 1990, c. S.26, s. 57; 1999, c. 6, s. 61 (1, 2); 2005, c. 5, s. 66 (3-8); 2006, c. 19, Sched. C, s. 1 (1).
Anastasia argued that Evangeline was not Stephen’s spouse since he was still married to Anastasia at the time of his death. Since Stephen and Evangeline had cohabited for less than three years at the time of his death, the dispute centred on whether Stephen and Evangeline were the natural or adoptive parents of a child, and whether a “child” included a child in utero.
Justice Bale rejected the argument that Evangeline was not a spouse simply because James had been born after Stephen’s death. If such an interpretation were adopted, then the surviving parent of a child born one day before the deceased parent’s death would be deemed a spouse for support purposes, but if the child were born one day after the deceased parent’s death, then the surviving parent would be disentitled to support. Such a result would be entirely inequitable. Instead, Justice Bale held that under s. 1(1) of the SLRA, a “child” included a child conceived before, and born alive after, the parent’s death.
Justice Bale further held that a deceased person could have two spouses within the meaning of the SLRA, and that Evangeline could therefore be deemed to be Stephen’s spouse even though Stephen was still legally married to Anastasia at the time of his death. Although they were not spouses in the strict statutory sense, “they were common law spouses in the commonly understood sense of the word.”
Proceeds of Life Insurance Policy Available to Satisfy Dependant Support Claims
Once the court determined that Evangeline and her son both qualified as dependants and that adequate support had not been made for them under Stephen’s will, the court needed to assess whether the proceeds of Stephen’s life insurance policy were available to satisfy the dependants’ support claims.
Under s. 72(1)(f) of the SLRA, any amount payable from the proceeds of an insurance policy owned by the deceased can be allocated towards the payment of dependant support claims. However, since Stephen had designated Anastasia as the irrevocable beneficiary under the policy, she argued that he no longer owned the policy and that the proceeds should therefore not be made available to satisfy any support obligations.
The court disagreed, stating: “If the Legislature had intended to except life insurance policies which are subject to an irrevocable designation under section 72, one would have expected the exception to be made explicit.” The designation had been made pursuant to a temporary order, and Stephen had retained the right to argue, at the final hearing of the family law application, that the designation to Anastasia was not warranted, or that only a portion of the insurance money ought to be subject to the designation.
In the result, Evangeline was awarded $20,000.00 of the life insurance proceeds in interim support for her and her son, and $2,000.00 per month to cover the costs of litigation until the application was heard.
Although unique in its circumstances, this case nonetheless sets an interesting precedent pertaining to dependant support claims. Since James was born alive, Evangeline was deemed to be Stephen’s spouse and was therefore entitled to make a claim for support from his estate. If James had not survived the birth, the court presumably would have determined that Evangeline was not Stephen’s spouse, as they had not cohabited continuously for three years prior to his death, and that she was therefore not entitled to dependant support.
Going forward, it will be interesting to see how the courts will treat cases where dependant support is claimed by a child who was not conceived at the time of one parent’s death (such as a child born through in vitro fertilization or cryopreservation) or the surviving parent of such a child.
Furthermore, this decision makes clear that life insurance policies owned by a spouse, the proceeds of which are irrevocably designated to another beneficiary, can nonetheless be treated as part of the deceased spouse’s estate for the purposes of satisfying dependant support claims.
If you are involved in a matrimonial or estate-related dispute, we encourage you to contact the lawyers at Blumberg Segal LLP, who have expertise in these areas. We can provide you with the information you need to determine whether to proceed with litigation, and can help you achieve a positive resolution in a cost-effective manner.
Maria Constantine is an associate at Blumberg Segal LLP, practicing in civil and commercial litigation, including family and estate litigation. Maria can be reached at firstname.lastname@example.org or 416-361-1982 ext. 246.