Resolving Challenges to Testamentary Documents and other estate disputes

Sometimes estate disputes are inevitable given the family dynamics for the challenge to be made. A variety of mechanisms exist to resolve disputes arising over testamentary documents, such as informal settlement, mediation, and court.

Informal Settlement  

At any time, the matter can be resolved informally. Legal counsel may discuss the case and advise the parties to settle. Sometimes settlement comes early on in the matter; at other times it is only after documents are exchanged and significant disclosure has been made and the parties are able to assess the case. Once lawyers are retained, the Rules of Professional Conduct preclude lawyers from dealing directly with the “opposite” client. All communications must be lawyer to lawyer. This does not, however, stop the clients from speaking with each other directly. Sometimes clients talking amongst themselves can lead to an agreement.

Mediation

Mediation provides a usually successful dispute resolution opportunity for the parties with settlement in mind. The Ontario Rules of Civil Procedure establish mandatory mediation of estates disputes. The Rule applies for virtually all disputes arising from Wills, trusts, powers of attorney, trustee accounting, statutory claims against estates, and other trust, estate and fiduciary matters in Toronto, Ottawa and Windsor.

Early on in the estate litigation process, a motion for directions is typically brought to set out the procedure for the litigation. These directions usually include details regarding the conduct of the mediation, such as the issues to be mediated, the parties who are to attend the mediation, the allocation of mediation costs, service and timing.

Likewise, on their own initiative, the parties can voluntarily agree to mediate. There is no set time when mediation is to occur.

Mandatory mediation is a minimum of three hours, though the parties may agree to extend the duration. Non-mandatory mediation typically lasts one full day. All communications at the mediation, and the mediator’s notes and records, are deemed to be without prejudice settlement discussions. If the mediation leads to a solution, a settlement agreement is prepared and the matter ends. Otherwise, the litigation proceeds.

Mediation can be “rights-based”, where legal positions play a key role in the negotiations, “interest-based”, where the process seeks to uncover the parties’ underlying values and concerns; or a combination of the two. In most estate situations, interest-based mediation is appropriate, since deep-rooted family feelings may present a major challenge to the mediator and also lead to creative solutions.

Mediation offers several advantages, including confidentiality of the issues. The mediator is a neutral third party chosen by the parties or otherwise by the court’s mediation coordinator.

After the mediator and date are determined, each party prepares a statement of the factual and legal issues, and sets out his/her/its position and interests. In addition to the brief, key documents are included  (e.g., the Will, estate inventory, the estate value, a family tree with ages of the relevant family members, and a real estate appraisal and/or family business valuation where applicable.

The mediation itself typically occurs informally yet professionally. The mediator is not a judge (although he or she may be a retired judge) and does not decide the case for the parties. Some mediators will not give their own views of the case being mediated if asked. The mediation process has proven to be very effective and has become the norm even where it is not mandatory.

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