Why you need a Will
While it may be difficult to contemplate what to leave behind and to whom upon your passing, it is always best to be prepared in advance for the inevitable. Few people realize that death can be emotionally and financially burdensome for family and loved ones left behind. Even more so, death can be legally taxing as well. Written instructions can help; the more detailed and specific they are, the more streamlined and thorough one’s estate distribution can be.
- Should you pass without a valid Will (i.e. intestate), your estate will be distributed in accordance with provincial laws, which may or may not represent the best possible outcome for your family and loved ones.
- Maintaining a current or up-to-date Will ensures that the distribution of your estate is in accordance with your intentions, your preferences and your specifications.
- A current, detailed and valid Will provides you with the peace of mind and it prevents your passing from becoming a source of tension, stress, or a legally administrative burden upon your family and loved ones.
Family Law Implications
- When you marry, any valid Will made prior to your date of marriage is invalidated, unless it was made in contemplation of your upcoming marriage. Here are a few of the disadvantages:
- Divorce, on the other hand, does not invalidate a pre-existing valid Will. Your former spouse may nevertheless be able to claim a share of your estate, unless your previous Will is updated to reflect your change in marital status.
- If you have minor children, you can specify in your Will how they can be cared for and provided for by your estate, upon your passing, as well as who is to be appointed as their guardian until the children have reached adulthood or become independent.
- If both you and your spouse die at the same time, your guardian of choice can look after your children, so long as they are dependents. This choice, as specified in a valid Will, is also taken into consideration in a court’s final decision with respect to guardianship.
- You can also designate a property guardian or trustee to manage the wealth you leave behind for the benefit of your children until they reach adulthood or become independent.
- If only one of the spouses passes away and there are minor children left behind, the surviving spouse will need to apply to the court to be an Estate Trustee without a Will.
- You must also keep in mind the differences that exist between the treatment of common law spouses and married spouses when one of the parties dies without a Will.
- A common law spouse does not have the same rights to share in the assets of the deceased spouse, as a married spouse would. Unless there is a valid Will in place specifying otherwise, a common law spouse may end up with no property after the passing of his or her partner.
- When there is no valid Will in place, a surviving married spouse in the Province of Ontario is entitled to the first $200,000.00 of the deceased spouse’s estate assets, with the remainder of the estate being split in equal shares between the child(ren) and the surviving spouse.
- Pursuant to section 4(2) of the Family Law Act, property, other than a matrimonial home, which was acquired by gift or inheritance from a third person after the date of the marriage, is excluded from the spouse’s net family property at separation.
- However, income from such property may be included in the spouse’s net family property, unless the donor or testator expressly states in his or her Will that such income is to be excluded from the spouse’s net family property.
- Practically, this means that property gifted to or inherited by your child upon your passing, through a valid Will, may be protected by being specifically excluded from your child’s net family property, thus preventing your child’s former spouse from sharing in on the value of this gifted or inherited property post-separation.
When does the Office of the Public Guardian and Trustee become involved?
The Office of the Public Guardian and Trustee (OPGT) will protect the interests of potential heirs when an Ontario resident dies leaving an estate behind with no one available to administer it. The OPGT will apply to be appointed estate trustee if:
- The deceased was an Ontario resident or owned real estate in the Province of Ontario; and
- The deceased did not make a Will or the deceased made a Will, but the executor elected to administer the estate has since died, become incapable or is unwilling to be an executor; and
- There are no known next-of-kin to the deceased living in the Province of Ontario or the next-of-kin are minors or mentally incapable adults; and
- The estate is valued at a minimum of $10,000.00 after payment of funeral expenses and all debts owing by the estate of the deceased.
Dying without a Will
Here are some obvious disadvantages of dying without a Will:
- Estate division and/or distribution is done in accordance with a provincial distribution formula, as opposed to in accordance with your wishes and preferences as a donor or testator.
- The individual looking after your estate may not be the person you would have chosen to handle your affairs upon your passing.
- The process of settling estate affairs of the deceased is more costly and time-consuming when there is no valid Will in place.
- Until a Certificate of Appointment is issued, there is no person with the requisite authority to deal with your estate.
- A power of attorney previously granted by your to someone else automatically terminates upon your passing. Therefore, if there is no valid Will in place, your previous power of attorney will not be able to deal with your estate affairs.
- In cases where you own property with another individual (other than spouse) as joint tenants, if you die without a will, the joint tenancy will be severed and ownership reverts fully to the other individual. This means that upon your passing without a valid Will, your surviving spouse and child(ren) will not inherit your half share in that property.
- Specific instructions in your Will severing the joint tenancy upon your passing and having it convert to tenancy in common ensures that your surviving spouse and child(ren) share in on the asset.
Leaving things to chance does not work in life; why would it be any different upon death? At Nanda and Associate Lawyers, we can assist you with all of your estate planning needs, so you do not have to rely on chance.
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