Printer-friendly version

What happens when a segregated fund names one child as beneficiary, mom passes away without a will, and the other sibling decides he's entitled to half?

That's exactly what played out in RBC Life Insurance Company v. Masitch et al, 2026 ONSC 2277. Whose money is it when a beneficiary and an estate both claim it? | Wealth Professional

Background:

Valentina Masitch died intestate in 2023, having named her son Dimitri as sole beneficiary on two segregated fund contracts (one non-registered, one TFSA). Her other son, Oleg, argued the proceeds should be split evenly, claiming Dimitri was only named for "administrative convenience" and was holding the funds in a resulting trust for the estate.

Outcome:

Justice Dietrich didn't buy it.

Applying Mak (Estate) v. Mak over Calmusky v. Calmusky, the court confirmed the presumption of resulting trust does not apply to segregated fund beneficiary designations in Ontario. Dimitri got the full proceeds.

Why this matters for your Segregated Fund business:

• This is the second ruling in Ontario this year reinforcing that a named beneficiary on a Seg contract stands; even without a will backing it up
• The mother's own handwritten notes to her advisor were reviewed by the court but weren't enough on their own to prove intent to split
  • A good reminder that thorough advisor notes can make or break these cases

Bottom line (tl;dr):  

Segs remain one of the strongest tools to bypass probate and honour a client's actual wishes; even when there's no will (or a messy one) in the picture.

There are court tests to back the power of the beneficiary designation

If you want to talk through how this plays into estate planning conversations with your clients, feel free to schedule time with me: Book Meeting with Me

BMO Market Commentary:

This Week With Sadiq: Click Here

• Markets appear to be realizing that the U.S.-Iran conflict could continue for some time. That risk and other uncertainties are why we’ve trimmed our Equity allocation this month while remaining slightly overweight.
• Public opposition to data centre construction runs the risk of increasing costs for AI companies, though we think the facilities’ employment and productivity benefits will help them get built.
• So far, both Canadian and American consumers have held up relatively well in the face of tariffs. If some weakness does eventually materialize, we’d expect it to show up in Canada first.

BMO ETF Portfolio Monthly Commentary: Click Here

BMO GAM Monthly House View: Click Here

Flash Piece: BoC on Hold: healing, but not booming

Please let us know what questions you have.