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In the recent case of Dagg v Cameron (Estate), 2015 ONSC 6134, the Court considered whether two individuals could be considered “spouses” because they had an unborn child together at the time of the father’s death. This case considers who is a “spouse” as defined by the Succession Law Reform Act (SLRA) for the purposes of the dependants’ support and how insurance proceeds are to be dealt with when proceeds are claimed by competing “spouses”.
The applicant, Evangeline Dagg (“Evangeline”), was living with Stephen Cameron (“Stephen”) at the time of his death. Evangeline was pregnant with their child. They had been living together for less than three years. At the time of his death, Stephen had not yet finalized his divorce from his wife Anastasia Cameron (“Anastasia”), with whom he had two other minor children. Evangeline and Stephen had intended to marry, but had been unable to due to delays in the matrimonial proceedings.
As part of the divorce proceedings, Anastasia obtained a temporary court order on consent which required that Stephen maintain Anastasia as irrevocable beneficiary on any life insurance policy” for the purposes of child and spousal support.
When Stephen was subsequently diagnosed with terminal cancer, he changed the designated beneficiary of his life insurance policy contrary to the court order. His change divided the designation between Evangeline, who was to receive 53.6% of the proceeds, and Anastasia and her two minor children, who were to receive the remaining 46.4%. Anastasia discovered that Stephen had made the change and she then obtained a court order requiring the insurer to restore the prior designation.
Evangeline’s gave birth to their child, James, after Stephen’s death. She then filed a dependants’ support application on behalf of herself and James against Stephen’s estate. Evangeline brought this motion before the court for interim support pending final resolution. Two issues were before the court in this decision: Whether Evangeline is a “dependant” under section 57 of the SLRA and whether life insurance money would be available to satisfy Evangeline’s claim.
Anastasia argued that because James was not born until after Stephen’s death, and because Stephen and Evangeline had not cohabited continuously for 3 years, Evangeline was not Stephen’s “spouse” and he therefore did not owe her any support obligation at his death. The Court held that although Stephen and Evangeline were not statutory spouses under the SLRA, they were common law spouses “in the commonly understood sense of the word.” The Court found that Evangeline and James’ status as dependant child and dependant spouse, and their resulting entitlement to support, were contingent on James’ live birth following his father’s death.
This case is also notable because it questions the common practice in family law cases of designating ex-spouses as the irrevocable beneficiary of a life insurance policy in order to secure support obligations. The Court held that although such a policy provides an alternate source for the payment of support should the support-payor die, the policy is also available to all dependants. This case provides another example of the intersection between family law and estate lawyers. It will be noteworthy to see the final outcome of the final hearing of the application in this case
If you have questions about this case, please contact experienced family lawyer Jason P. Howie, online or at 519.973.1500.
To read the full decision, click here.
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