“I’ve written to everybody that I can think of and had no answer,” says Nicholas Gehl, a real estate lawyer in Waterloo, Ont., and father of murder victim Nadia Gehl, in reference to his concerns about the urgency of proclaiming the amendments.
Nadia’s husband, Ronald Cyr, is seeking to appeal his conviction last year for first-degree murder in the case, a move that could allow him to receive up to $500,000 in insurance money if the court finds him not criminally responsible.
The murder victim had two insurance policies that named Cyr the beneficiary for both claims. But according to her father, recent amendments to s. 194 of the Insurance Act could prevent Cyr from receiving the money.
One of the key changes allows a judge to decide whether or not a beneficiary can have access to the deceased spouse’s estate. Otherwise, the insurance money would go to the state. The province, however, has yet to proclaim the amendments.
“The amendments are positive on two levels: one from the estates planning standpoint and the other is from the family law bar,” says Ian Hull, cofounder of Hull & Hull LLP. Hull says the amendments will fix beneficiary designation procedures that were a key complication under the existing legislation.
“I think it adds flexibility to the estates planner because you can clearly put in an alternate on the beneficiary designation that wasn’t readily available before,” says Hull.
“The insurance companies are going to be forced essentially to give us more options at the time of our designations than we did before, which is only good.”
The amendments reflect similar provisions in Alberta and British Columbia’s insurance acts that came into force in July 2012. According to Jodi Skeates, senior counsel for the Canadian Life and Health Insurance Association Inc., Canada’s life insurance legislation had had no substantial revisions since 1962 prior to the recent provincial amendments.
But the amendments are still under review and are subject to consultations with various stakeholders, including the insurance companies. According to Vincent De Angelis, a trusts and estates lawyer and chairman of the statutory review subcommittee of the Ontario Bar Association, the insurance association made submissions last April with a number of concerns and suggested changes.
“I’m certainly looking forward to seeing the act proclaimed, hopefully with some of the changes that have been requested, especially by the insurance industry,” says De Angelis.
But with the changes at a standstill since 2012, Gehl says they’ll have no effect until the Ontario government proclaims them. Although the amendments won’t apply to any cases prior to proclamation, Gehl hopes they’ll “prevent this sort of thing from happening to anyone else.”
According to the Record newspaper in Waterloo, Dennis Zvolensky and Nashat Qahwash shot Nadia twice at a Kitchener, Ont., bus stop on Feb. 2, 2009. Court heard the two men were longtime friends of Cyr, who had hired them to kill Nadia in exchange for a portion of her insurance claims. The three men are now serving automatic life sentences with no chance of parole for 25 years.
Gehl doesn’t believe Cyr should receive his daughter’s insurance policies. According to Gehl, Cyr assigned his assets to legal aid for his defence, which would include Nadia’s policies if the court overturns his conviction.
“My essential argument is that the money should be paid out to the appropriate beneficiary — the estate,” says Gehl, who believes insurance companies should allow other suitable beneficiaries to inherit the policies. “If you thought you weren’t going to get the money, nobody would pay for life insurance.”
For Gehl, the problem with the Insurance Act comes down to a 1992 Supreme Court ruling in Brissette Estate v. Westbury Life Insurance Co. that determined that a named beneficiary of an insurance policy who’s responsible for the murder can’t collect the money and neither can anyone else.
Since Gehl was a secondary beneficiary on only one of the policies — one valued at $300,000 — the victim’s other policy for $200,000 would pass to the state. Gehl says that scenario wouldn’t happen if the amendments were in place.
“Under the other policy, he [Cyr] was simply named as beneficiary, nobody else,” says Gehl. “So if he doesn’t get the money, the court decision of the Supreme Court says nobody gets it.”
Gehl believes that the Supreme Court’s decision was “silly” because it only deals with the insurance contract.
“It doesn’t deal with the issue of if there’s no other assets or even if there are other assets, should kids get the money or should it be held in trust funds for them?” says Gehl. “That is the purpose of life insurance and the Supreme Court of Canada, in the decision, just ignored all of that stuff.”
But although his daughter had no children, Gehl says he has witnessed several cases where the state still collected a victim’s insurance claims rather than the surviving offspring.
“They’re the only ones who benefit from this and that’s ridiculous,” says Gehl. “If there were three or four kids involved, those kids wouldn’t get a dime of this stuff and that’s offensive as far as I’m concerned.”
For now, no beneficiary changes can take place pending a motion for Cyr’s appeal application, but Gehl hopes the amendments will have an impact on similar estates cases in the future. Since the Liberal leadership campaign has ended, Gehl says maybe now “they’ll start to think about this sort of thing” and proclaim the amendments.
Gehl’s concerns follow the case of Ontario lawyer Demitry Papasotiriou, who’s accused of murdering his husband Allan Lanteigne and is now in a legal battle with the victim’s family over the life insurance money.
For more, see "Accused lawyer seeking deceased husband's insurance."