It seems clear that the degree of understanding required of a donor is the same as testamentary capacity when the effect of the gift is to dispose of the only asset of value and preempt the devolution of the estate. In MacGrotty v. Anderson, [1995] B.C.J. No. 1857 (S.C.), Josephson J. dealt with the validity of a transfer to a fiduciary. He summarized the law, in part, at para. 20, as follows: If the effect of the gift was to dispose of the donor's only asset of value and to pre-empt the devolution of his estate under his will or on his intestacy, the degree of understanding required is as high as that required for a will and the donor must understand the claims of all potential donees and the extent of the property to be disposed of. ... Josephson J. went on in the paragraph to emphasize that, where a donor makes a gift and then dies, the evidence “must be examined with care, even with suspicion, though it need not necessarily be corroborated”.
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