By: Jennifer A.N. Corak - Wills and Estates Group
As an estate planning lawyer, it is not unusual for individuals to confess to me that they do not have a Will (or that it has been a long time since they turned their mind to their Will and estate planning). The reasons for not engaging in the process vary. When it is based on an unwillingness to confront one’s own mortality, it may be difficult to overcome. However, when someone does not have an up-to-date Will because they are unclear about the process itself, a qualified Will and estate planning lawyer can help. To help demystify the Will and estate planning process, this article provides comments on three questions I have been asked over the years:
- What is the Will and estate planning process?
- What if I do not have a Will?
- What kind of information will my Will and estate planning lawyer ask for?
1. What is the Will and estate planning process?
When an individual engages in the Will and estate planning process, they are taking action to have a say in how their assets are to be distributed following their death. The process involves the individual (for the purposes of a Will referred to as the testator) executing one or more Wills.
A Will should:
- Set out who will inherit the testator’s assets following their death (i.e., who will be the beneficiaries of the testator’s estate), and
- Name one or more executors who will be responsible for administering their estate (following the instructions set out in the Will).
It will typically set out a number of executor and trustee powers, and may also include a provision specifying who should have decision-making responsibility (previously referred to as custody) when a testator has minor children.
The estate planning process goes beyond the preparation and execution of a Will and must be tailored to an individual’s circumstances. For example, steps may be taken to reduce exposure to estate administration tax (commonly known as probate tax). Individuals are also encouraged to plan for incapacity, which generally involves the preparation and execution of Powers of Attorney for Property and Personal Care.
2. What if I do not have a Will?
In Ontario, if an individual dies without a valid Will their estate will be distributed in accordance with the laws of intestacy set out in the Ontario Succession Law Reform Act (“SLRA”) and the appointment of a person to administer the estate will be determined in accordance with the Ontario Estates Act. Simply put, if you do not have a valid Will you will not have a say in who will receive your assets, how your assets will be administered, and by whom.
The implications of this will depend on your circumstances. For example, let’s say an individual who dies without a valid Will is survived by a common law spouse and no issue (i.e., no children or more remote descendants). The SLRA provides that if an individual is survived by a married spouse and no issue, the spouse will obtain the deceased’s entire estate. It does not make the same provision for a common law spouse. If you want your common law spouse to inherit your estate, you should provide for this in a Will.
As another example, let’s say an individual dies without a Will and is survived by their spouse (who they were legally married to), and two children – one who is a minor and the other with whom the deceased was estranged. In this case, the SLRA provides that the surviving spouse is to receive a preferential share in an amount prescribed by regulation (which is currently $350,000 for deaths after March 1, 2021) and the remainder is to be divided so that the spouse receives 1/3, and the remaining 2/3 is divided between the surviving children. This distribution does not consider that since the deceased and one of the children were estranged, the deceased may not have intended for such child to receive a portion of the estate or as large of a portion. Where the minor child is concerned, the share will get paid into court until they turn 18, at which point the child will receive it outright. If the deceased had executed a Will, steps could have been taken to avoid the need to pay the funds into court. The deceased could have specified the age or ages the child should receive the gift (since many people feel 18 years of age is too young to receive a large sum of money). Without addressing these issues in a Will, the distribution may go against your true wishes, to the wrong people, or at the wrong time. If you want a person you care for or a charity you support to receive a portion of your estate, you can do this through your Will.
3. What kind of information will my Will and estate planning lawyer ask for?
A Will and estate planning lawyer is likely to ask a number of questions about you, your family, and any other intended beneficiaries, such as information related to:
- Your occupation,
- Date of birth,
- Marital status,
- Members of your family,
- Age and place of residence of intended beneficiaries,
- Whether any beneficiaries are recipients of Ontario disability support program (ODSP) payments, and
- Whether you have any dependants.
Financial information you will likely be asked for includes:
- A description of your assets (including tangible assets and digital assets),
- How you own your assets,
- Where assets are located,
- Where applicable, whether you have named designated beneficiaries, and
- A description of your liabilities.
You will also be asked to describe who you want to receive your assets following your death. You will need to consider whether you have entered into any agreements that may impact distribution of your assets following your death (such as marriage contracts, separation agreements, and/or shareholders’ agreements).
This information is important as it informs the planning process. For example, if you tell your lawyer you have personal property of significant value, shares in a private corporation, and/or assets outside of Ontario, they can discuss with you the advantages of having multiple Wills. If applicable, they can help you seek the legal advice of a qualified lawyer outside of Ontario to advise on the laws of the jurisdiction where your assets are located. Further, equipped with information relating to your personal circumstances and asset ownership, a qualified Will and estate planning lawyer can identify potential pitfalls associated with certain instructions. They can counsel you on the options available to you, so that you can make informed decisions – for example, they can explain and discuss with you the implications of naming non-resident executors or making an outright gift to a minor or an ODSP recipient.
Overall, the estate planning process is a personal one. It looks different each time and is shaped by each individual’s values, wishes, and circumstances. As a Will and estate planning lawyer, the goal is to help you navigate the process. If you already have a Will, you should review it periodically, and at least after a major life event or change in circumstances. Should you wish to discuss your situation in greater detail, contact Jennifer A.N. Corak at email@example.com or any lawyer in our Wills and Estates Group.