What is a Testamentary Contract?

A testamentary contract allows a will writer to leave their estate to another person in exchange for something. Usually, this comes in the form of services, like end of life care for the will writer. A testamentary contract is a binding contract. A will writer will not be able to change the beneficiary of the assets after agreeing to the contract. Testamentary contracts can often give rise to estate litigation, for a number of reasons. In this article, we’ll cover the basics of testamentary contracts and problems that can arise from them in your estate plan.

Basics of the Testamentary Contract

When a will writer enters into a testamentary contract, they are agreeing to give their estate, or a specific asset to a specific person. If they later change their will to deprive this person of the assets promised in the testamentary contract, the beneficiary can sue for breach of contract. If they are successful in proving the existence and breach of a testamentary contract, either before or after the death of the testator, the Courts can enforce the contract by varying the will.

Common Problems

It is not uncommon for testamentary contracts to take the form of a verbal agreement. The most common problem litigants face in enforcing a testamentary contract is proving the existence of the contract to the Courts. This exact problem came before the B.C Supreme Court in the 2022 case of Angelis v. Siermy. 

In this case, a woman with no children left the majority of her high-value estate to one of her nieces in a 2002 estate plan. Years later in 2011, the aunt changed her will to give most of her estate to a different one of her nieces. The first niece, the claimant, alleged she had an oral testamentary contract with her aunt. In the alleged agreement, the aunt promised the majority of her estate to this niece in exchange for several years of unpaid end of life care. She claimed that the execution of the 2011 will breached this agreement. 

Somewhat unusual in estate litigation, the will writing aunt was still alive when her niece brought this claim. The aunt denied the niece’s claim that they had a testamentary contract or even a verbal agreement, though neither parties had witnesses to support their claims. The claimant provided the Court with letters allegedly written by her aunt which explained her reasons for executing her 2002 will. The aunt denied writing these letters and, ultimately, the Court found that the claimant had forged two of the letters she submitted as evidence. The Court stated there wasn’t sufficient evidence that a testamentary contract ever existed between the two parties, and the claim was dismissed. 

Key Takeaways

Testamentary contracts are not uncommon in estate planning, as will writers promise loved ones certain assets in exchange for end of life care or other services such as home maintenance. However, people entering into these agreements should clearly document that there is an exchange of estate assets for services or other consideration. It is also advisable to ensure that other parties are aware of the will writer’s intention to exchange specific assets for services from a beneficiary. Having a record of the agreement which can be supported by witness testimony will ensure that the Courts can enforce a testamentary contract, even after the death of the will writer. 

If you have questions about giving estate assets to a beneficiary in exchange for services, or if you are concerned that your testamentary contract won’t be honoured by a will writer, contact an experienced estate lawyer today.

Have a question about this topic or a different legal topic? Contact us for a free consultation. Reach us via phone at 250-888-0002, or via email at info@leaguelaw.com.