- A per stirpes distribution is the distribution of a share of the gift to a branch amongst the members of the branch.
- While terms like per stirpes have precise meanings, these terms sometimes are used imprecisely and inconsistent with its legal definition.
- Where per stirpes is used incorrectly, the court will first ascertain the intention of the deceased based on the wording in the Will. If the intention of the deceased cannot be determined, the court will use the arm-chair rule to interpret the Will.
The Legal Definition of “Per Stirpes”
Estate planning lawyers use arcane terms like “per Stirpes” to articulate long-standing and precise meanings. The legal definition of “per stirpes” distribution means each branch is entitled to one share of the gift distributed among the members of the branch. For example, where a gift is made to issue alive at the testator’s death “per stirpes”, the children of a deceased child of the testator each share the deceased child’s share of the gift.
Moore v. Moore: When Lawyers use Per Stirpes Incorrectly
For clients with no legal background, arcane terms like per stirpes are incomprehensible jargon. Unfortunately, lawyers are also guilty of using these terms in a manner inconsistent with the precise meaning.
This is the challenge faced by Justice Broad in Estate of Stanley Moore v. Moore, 2018 ONSC 6420, where the lawyer who authored a Will used “per stirpes” inaccurately. In this case, Stanley Moore (“Stanley“) died in June 2017 with a Will dated in October 1979. Stanley never married and did not leave any children. In his Will, Stanley divided into two equal shares divided as follows:
- One share was divided between his siblings, Verna and John, “for their own use absolutely”;
- The other share was to be divided among his surviving nieces and nephews, “per stirpes”
- If either of Verna and John or Stanley’s nieces or nephews predecease Stanley, the shares of those surviving would be enlarged, per stirpes.”
Stanley’s brother, John, predeceased Stanley. As a consequence, the remaining beneficiaries of the Estate sought clarification from Justice Broad on how the Estate of Stanley ought to be divided.
During the hearing, Justice Broad was faced with four competing interpretations. The Estate Trustee favoured an interpretation where the phrase “per stirpes” is ignored as a result of its’ use in a manner inconsistent with its established meaning.
Representing John’s children, Romesh Hettiarachchi relied on the Ontario Court of Appeal’s in Dice v. Dice Estate, 2012 ONCA 468, to argue:
- The starting point to construe a Will is to ascertain Stanley’s intention simply based on the words used in the Will.
- Where the plain meaning of the language in the Will does not clearly state Stanley’s intention, the court may consider the surrounding circumstances known to Stanley at the time his lawyer authored the Will (known as “the armchair rule“).
The principles set out in R. v. Lachowski (1976) 1976 CanLII 774 (ON SC) supported Romesh’s position:
- Where a clear intention is shown, a later provision in a will cuts down an absolute gift and
- if two parts of a will are inconsistent, the latter prima facie prevails.
In this case, Justice Broad found in favour of the Respondents. Relying on the armchair rule, Justice Broad put himself as close as possible to, the same position of Stanley when [making] his last will and testament and found the following:
- Stanley wished to benefit his siblings equally with one half of the residue of his estate;
- Stanley wished to benefit the second generation of the two branches of the family (his niece and nephews) promptly, with the other one half of the residue of his estate;
- Stanley did not wish to directly benefit subsequent generations of the two branches, in the event of one or more of his nephews and niece predeceasing him;
- Stanley wished to promptly benefit the individual members of the second generation of the two branches in equal shares, notwithstanding the fact that Verna had three children and John had two; and
- Allowing for the difference in the number of nieces and nephews in the two branches of the family, Stanley wished the total benefit given to each branch to be roughly equal.
Justice Broad continued to find it would be an error to give prominence to the word “absolutely” in one paragraph of the Will and give no importance to the phrase “per stirpes” in a later paragraph of the Will. The latter provision “cut down” the former provision.