Deziel’s deathbed gift — when good intentions meet legal hurdles
As the holiday season approaches, the topic of gifts is on everyone’s mind. But what happens when a gift, especially one given on a deathbed, runs into legal roadblocks?
The case of Deziel v. Deziel (2024 ONSC 5279) highlights this dilemma. Elizabeth Deziel, a mother of three, wrote a $40,000 cheque to her daughter Debra as a gift to compensate her for caregiving. Tragically, Elizabeth passed away 14 days later, and the cheque had not been cashed. The court ultimately invalidated the gift because it failed to meet the requirements for a “deathbed gift,” or donatio mortis causa.
What is a deathbed gift?
A deathbed gift is a gift made from an ill or dying donor that creates a resulting trust back to the donor should they recover. To qualify as a deathbed gift, three conditions must be met:
- The gift must be made in contemplation of imminent death.
- It must revert to the donor if they recover.
- The gift must be successfully delivered.
In this case, while the first two conditions were met, the court ruled the cheque was not “delivered” because it hadn’t been cashed before Elizabeth’s passing.
Why did the gift fail?
Debra’s intention was to wait to cash the cheque to ensure her mother had funds in case of unexpected expenses. Ironically, this cautious and well intentioned approach led to the failure of the gift.
The court acknowledged Debra’s good intentions, but legal technicalities prevailed. Had she cashed the cheque immediately, a resulting trust would have been created for her mother’s benefit, thereby satisfying the concerns that caused her to wait.
Should the law be reconsidered?
This case raises broader questions about whether the law on deathbed gifts needs reform. Should the donor’s intention and reasonable efforts to deliver the gift carry more weight?
For instance:
- Intentions matter: Debra’s actions aligned with the purpose of deathbed gifts: protecting the donor’s financial security. Yet, the gift was invalidated due to a technicality.
- Delivery challenges: Writing and signing a cheque is a common way to transfer funds. Expecting deathbed donors to use complex methods like certified cheques or wire transfers seems impractical for most.
Balancing reform and protection
While reform could simplify gifting for everyday people, courts must also guard against potential elder abuse and undue influence. In Deziel, the court had to balance protecting Elizabeth’s estate with respecting her wishes — a delicate and difficult task.
The case serves as a cautionary tale about the complexities of estate planning and the importance of understanding legal nuances. As we celebrate the season of giving, it’s a reminder to approach significant gifts with care — and maybe even professional advice.
This article was originally published by The Hamilton Spectator.
