Dagg v. Cameron1 is one of those cases that law school professors use to challenge the way you think.
Stephen Cameron was a 48 year old guy living with Evangeline who was 8 months pregnant with his baby. Tragedy struck and Stephen died. The baby was born after Stephen’s death. What made things interesting was that there was no will.
Evangeline made an application for support under Ontario’s Succession Law Reform Act, R.S.O. 1990, c. S.26 (“SLRA”) claiming that the deceased did not provide adequate and proper support for her and the baby. So why did this end up in court?
Let’s start at the beginning. In 2004 Stephen married his first wife Anastasia. They lived together in Ontario for 8 years and had two children. In January 2012 they separated and one month later in February 2012 Stephen reignited a relationship with Evangeline, a woman who lived in the USA. To be together Stephen got a job in British Columbia so he could commute to see Evangeline in Washington State.
For two weeks in every month Stephen visited with Evangeline and they lived together as man and wife. They wanted to get legally married, but Stephen was still legally married to Anastasia. One year after they got back together Stephen and Evangeline fulfilled their desire to have a child and Evangeline became pregnant. Evangeline gave up her job in Washington and moved to British Columbia and the two lived together in a marriage like relationship on a full time basis.
In November 2013 Stephen found out he had cancer. He changed the designation of his insurance so that Evangeline would get 53.65 % of the insurance and Anastasia and her two children would get the balance. When Stephen first took out the life insurance he irrevocably designated Anastasia as beneficiary. Anastasia went to court and got an order to switch it back. Stephen died one week later on November 23, 2015. Enter the lawyers.
Evangeline sued. She wanted all of the insurance proceeds for herself and her son. Anastasia opposed the application. Let’s break down the argument.
Part V of the SLRA permits both a spouse and a child to sue when they were dependants of a deceased person who failed to provide them with adequate and proper support.2 For the purposes of support for dependants the assets of the deceased include things that are not ordinarily considered part of the estate3. One such example is an Insurance policy.
Anastasia claimed that there was no way that Evangeline could be Stephen’s spouse because he was still married to Anastasia at the time of his death.4 The court disagreed. In paragraph 14 the judge said,
Because Stephen and she were still legally married at the time of his death, Anastasia argues that she, and not Evangeline, was his spouse on the date of his death. There is no reason, however, why a deceased person cannot have two “spouses” to whom he or she has support obligations.
Anastasia’s next argument was that Evangeline was not a spouse because she and Stephen did not cohabit continuously for a period of not less than three years or and their child was not born until after Stephen died.5
In paragraph 15 of his order the judge explained why he disagreed,
Anastasia argues that the definition of spouse requires the “relationship of some permanence”, and the parenthood, to have coexisted at some point in time, and that because Stephen died before James was born, Evangeline and he were never spouses. She says that otherwise, a person could become a spouse of a deceased person after the deceased’s death, which would be “an absurd result”. … they were common law spouses, in the commonly understood sense of that term. …. There is nothing absurd in interpreting the Act to attach a support obligation to a common law relationship, based upon the birth of a child following the death of one of the common law spouses. Rather, to interpret the Act in the way that Anastasia suggests would mean that if a child was born, for example, the day before the death of one parent, the surviving parent would be a spouse, but not if the child was born two days later – clearly an inequitable result…
The judge went on to explain that
“under section 1(1) of the Act, “child” includes a child conceived before, and born alive after, the parent’s death. ….on the facts of the present case, Stephen and Evangeline were, on the date of death, the parents of a child who was conceived before, and born after, Stephen’s death.”
Anastasia came up with another interesting argument. Under section 72(1)(f) of the SLRA, “any amount payable under a policy of insurance effected on the life of the deceased, and owned by him or her,” is available for satisfaction of dependant support claims. Anastasia argued that Stephen did not own the Canada Life insurance policy, on the date of his death, because he had designated her as the irrevocable beneficiary under the policy. The judge said, 6
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. Anastasia’s argument is contrary to established precedent..”
So what new things did this case teach us? According to this judge the date of birth of a child is irrelevant as to whether that child qualifies as a dependant. As well, while a irrevocable designation of a beneficiary precludes the changing to that designation by the owner of the policy, it does not remove it from being a section 72 asset. This is not really new, because Anastasia’s argument was contrary to established precedent. (see Matthews v. Matthews Estate.7
The law is clear that, under the Succession Law Reform Act, life insurance policies owned by a spouse as in the case of this Respondent, even where another beneficiary is irrevocably designated, can be treated as part of the deceased spouse’s estate and available for the payment of support to a dependant
Query, what a judge might do if the facts were different. For example would the unborn child still be a dependant if the mother stored the father’s sperm (as couples sometimes do when the father may be going through chemotherapy) and the children was both conceived and born after the father died. Would the child still be a dependant? Would Anastasia’s argument that Evangeline was not a spouse have succeeded because at the time death there was no child? These questions, undoubtedly, will make interesting litigation in the future.
- 2015 ONSC 2597 (“Dagg”). This is available on line at http://bit.ly/Dagg-v-Cameron ↵
- These are the relevant sections of the SLRA for our discussion: Order for support 58. (1) Where a deceased, whether testate or intestate, has not made adequate provision for the proper support of his dependants or any of them, the court, on application, may order that such provision as it considers adequate be made out of the estate of the deceased for the proper support of the dependants or any of them. R.S.O. 1990, c. S.26, s. 58 (1). ↵
- The value of certain transactions that ordinarily are not included in a deceased’s estate, but are deemed to be part of his or her net estate for purposes of ascertaining the value of his or her estate, and being available to be charged for payment by an order for support are set out in section 72 of the SLRA. They include: (a) gifts mortis causa; (b) money deposited, together with interest thereon, in an account in the name of the deceased in trust for another or others with any bank, savings office, credit union or trust corporation, and remaining on deposit at the date of the death of the deceased; (c) money deposited, together with interest thereon, in an account in the name of the deceased and another person or persons and payable on death under the terms of the deposit or by operation of law to the survivor or survivors of those persons with any bank, savings office, credit union or trust corporation, and remaining on deposit at the date of the death of the deceased; >(d) any disposition of property made by a deceased whereby property is held at the date of his or her death by the deceased and another as joint tenants;(e) any disposition of property made by the deceased in trust or otherwise, to the extent that the deceased at the date of his or her death retained, either alone or in conjunction with another person or persons by the express provisions of the disposing instrument, a power to revoke such disposition, or a power to consume, invoke or dispose of the principal thereof, but the provisions of this clause do not affect the right of any income beneficiary to the income accrued and undistributed at the date of the death of the deceased;(f) any amount payable under a policy of insurance effected on the life of the deceased and owned by him or her; (f.1) any amount payable on the death of the deceased under a policy of group insurance; and (g) any amount payable under a designation of beneficiary under Part III. R.S.O. 1990, c. S.26, s. 72 (1); 1999, c. 12, Sched. B, s. 17. ↵
- For a fuller treatment of this issue, we refer the reader to the article, “…there is nothing that precludes … being in a spousal relationship with more than one person at a time…” – It is available on line at http://bit.ly/spousal-relationship ↵
- The exact definition of a spouse is set out in section 57 of the SLRA. It states, “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). ↵
- Dagg, at paras 21, 22. ↵
- 2012 ONSC 933 (CanLII).) ↵