The Creation of Estates: Presumptions and Words of Limitation p 376-377

The Creation of Estates: Presumptions and Words of Limitation p 376-377

·       can apply a condition to any right.

·       Generally, these are all construction of terms in a grant, a conveyancing document or a will.

·       "Courts like to grant things; don't like to divest people". So where the

o    Conveyance through will (unilateral), courts will favour the grantee: the grantor had the opportunity to clarify the condition and has no use for the estate if he's dead.

o    Conveyance through contract (bilateral): the bias is more balanced, courts assume the parties willingly and knowingly negotiated the agreement (could go either way)

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  McColgan: Must determine interpret the grant upon the expressed interest and not the intentions of the testator.
  
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  Sifton ” (L. Rowell – contextualize and normal for a single woman to leave Canada, L. Latchford executors should apply own judgement, L. Ficher the word permanent is a clerical error, it should say principle, L. King reside is indefinite, changes mind as says that she has to live in one place, Henderson C/S void for uncertainty.
  
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  Clayton v. Ramsden conditions of defeasance for “jewish parentage” fails because of uncertainty and lack of precision
  
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  RE Canada Trust Tarnopolsky J. Reuben Leonard – White Race superior, WASP British Empire and no RC’s- Charitable Trusts must have four purposes (Relief from poverty, advancement of education, advancement of religion, other purposes set out by thte Court – Must satisfy 3 conditions: It must as an object one of purposes, purpose must be wholly/exclusively charitable, must promote public benefit. To promote public benefit: Must be beneficial and not harmful to public and benefits must be available to a cross section of public. Meets all tests here. In private/family trusts discrimination is possible as the decision affects only charitable trusts.
  
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  Mackay v Nagle, 1988: did the word living mean children alive at the time the will took effect or did it mean living at the time the widow’s life estate expired?  Uncertainty in the word LIVING.  Therefore, the courts decided the interest should vest early Court says it prefers early vesting – based upon whatever the testator’s intent as what the Court comes up with.
  
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  Laurin v. Iron Ore Co. Look at the entire instrument for interpretation for restriction on alienation.
  

·       Fee Simple/life estate/chattel/whatever…) ABSOLUTE ESTATE

·       Fee Simple)/life estate/chattel/whatever…) DEFEASIBLE ESTATE not tied to the estate, it is tied to personal obligations/duties

o     E.g. you get the house on the condition that you must live in it (the condition is directly tied to estate to be valid). McColgan

·       The primary intention is to convey, and the suppletive intention is to control behavior. Courts generally favour the living here (as opposed to the wishes of the dead) – Court generally finds in favour of grantee regarding the interpretation of the conveyance.

o    Reversion: Grantor is left with right of re-entry. When the condition is broken, the grantor has the right to end the grantee’s estate, but the estate is not automatically broken.

o    Rules limiting conditions: Held void on:

§  Uncertainty or

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  Clayton L. Killowen and L. Romer For defeasible to be valid, the will of the grantor must be disposed with a high degree of precision, no uncertainty! Here “jewish parentage” too vague (religion/race/proportion of blood/standard unknown/practicing/grandparents/is he jewish at wedding etc…)
  
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  Sifton: Requirement to live in Canada is void for uncertainty.
  
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  Noble v. Wolf Justice Hogg; wants to buy into development, was wishes to invalidate restrictive covenant on race: the exact % of blood can never be ascertained – thus race in the ordinary and popular sense, clause not void for uncertainty (opposite of Clayton)
  
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  RE Canada Trust Not uncertain – the gift here was intended to be fulfilled. Proposed beneficiaries (students) have existed over six decades
  

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  Noble v. Wolf Justice Hogg 2 test: a) Does the issue fall into a class concerning public policy already recognized in statute or common law NO b) If no, is the harm to the public substantially incontestable? If no, then Court should not deal with public policy issue. Here Public policy rules should not be sought out in the rules of any other country or the United Nations Charter until the laws have been made part of the laws of Canada. – here Canadian public policy is shown through the categories of peoples recognized in the census, as the categories are the same Re Canada Trust WASP restrictions are against public policy, as public policy determined through a reference to a variety of courses, including provincial/federal statutes and official declarations of government policy and the constitution – public policy concerns against discrimination exists in laws in every jurisdiction of Canada. – Here discriminates on grounds of race, colour, nationality, ethic/religious origins and sex. Affirmative actions trusts that are restricted to visible minorities, women, or other disadvantaged groups must be evaluated on a case by case basis to have validity challenged, promotion of affirmative action is not bad though, must go through analysis of context, purpose and effect of restriction.
  
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  R. v. Rattray 13 million left to Queen’s in will struck down for uncertainty based upon it cannot be given to “communists, socialists, or fellow traveller.”
  
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  Fox V Fox Estate 1995 Leaves widow 75% of estate, power to use capital to grandchildren, and what is left to son, widow uses power of encroachment to stop estate residue to son as he marries a non-jewish woman. Galligan J.A. cites Canada trust and finds that this discriminates upon grounds of race or religion – this brings in charitable restrictions into private trusts. Any court will not uphold disinheritance now to marry outside of faith.
  
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  Re Hurshman 1956 Requirement to not a jew at time of inheritance is against public policy because she must divest herself of a husband.
  
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  Re Ramsden Estate 1996 bequest to uni for protestant students not allowed because university cannot administer test, but other body could, distinguishable from Leonard because here not “blatant religious supremacy and racism.” Motive of testator plays a role. University of Victoria v. The Queen 2000 restricting trust to class of RC recipients who are members of a particular faith does not offend public policy.
  

o    If held invalid: some argue it is integral. Invalidity destroys the gift for condition precedent – the person who created the estate would not want anyone to get the estate unless the condition is fulfilled.

o    Normally cannot impose a negative obligation.

o    Until condition is achieved - A will have only what is called a contingent interest. If someone dies or if the condition becomes impossible of performance, the interest will be extinguished and there is nothing that can pass to the heirs.

o    If there is A for life, then to B for life if she reaches 21 – if B reaches 21 while A is still alive, here estate becomes vested in interest as she has no right to possession until A dies. (Courts will generally favour the living in vesting).

o    Uncertain about acquiring

§  Un-ascertained recipient: First of child to get married, have a class of people, but there is no certainty about which among the class meets the test set out in the condition so ok here.

·       2 - Conditions Subsequent: An independent clause (Robert McGarry and William Wade’s): a condition that defeats an already vested estate (to C in fee simple, but if he does X, to D in fee simple), “defeasible” or “subject to divestment.” A condition subsequent defeats an (external) estate that has already been granted when the condition kicks in (kills interest)

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  McColgan “until her death” included in bequethment is an independent clause added to complete the fee simple absolute, which operates to defeat it. The condition is voidable if impossible, but the gift remains so it is an add-on, if she dies it is defeasible not determinable.
  
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  Sifton estate is for the benefit of the daughter “so long as she continue to reside in Canada, she wants to leave 11 months of the year – Could be precedent, but the Court finds if it is a CS, the Court must be determine to see from the words precisely and distinctly with accuracy what future conduct will fall within terms of will. Here, although not entirely uncertain, “land is for the living” so the Court interprets as uncertain clause = void, with CS, clause is struck out and the gift takes place.
  

o    Reversion: Grantor is left with right of re-entry. When the condition is broken, the grantor has the right to end the grantee’s estate, but the estate is not automatically broken.

o    Rules limiting conditions: Cannot contravene public policy. If the condition is held invalid by the court, the condition only is struck, and the grantee takes the estate free of the condition

·       C in fee simple, but if he ever does X, then to D in fee simple (Fee simple defeasible on condition subsequent) These conditions of defeasance are personal – if the condition of defeasance is not met, then C’s heirs will inherent a fee simple absolute.

 

Determinable Fee/Estate;-something less than fee simple nature of estate is that condition is part and parcel of fee. Determinable fee simple/limitation – CONDITION is a part of/tied to) the estate). The condition is considered part and parcel of the fee simple,

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  McColgan defines determinable as setting out the limit for an estate to be granted in the first place – if it is violated then the interest fails entirely.
  
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  Sifton if the condition is a determinable condition and is void, then the gift never gets off the ground.
  

·       Primary intention is to impose the condition, so if that condition is struck down for uncertainty or violation of public order, it automatically back to the grantor or further divests, but AUTOMATICALLY.

§  Reversion: determinable is automatically ended if the event specific occurs – this right in the grantor is called a possibility of reverter.

§  Rules limiting conditions: Cannot contravene public policy. If the condition is found invalid, the estate is entirely void and reverts to grantor.

§  Look for (Robert McGarry and William Wade’s) “until, ”“during,” “While,” “,as long as” but not entirely determinative.

·       After the Ontario CLPA (199) revisions (except PEI on Fee tail) all A to B and her heirs, A to B in fee simple, X to A forever and X to A means FEE simple. Now the Court just looks at the intention of the grantor to determine.