Wills, Power of Attorney and Estate Planning
Wills and Powers of Attorney play a significant role in your estate planning. They permit you to structure your affairs both during your lifetime and after your death in accordance with your wishes. If you don't have a will or appropriate powers of attorney, your estate will be dealt with in accordance with the statutory laws for intestate succession or the law governing guardianship of people unable to manage their own affairs, something none of us wish to happen to our families once we have left them.
Intestate Succession [dying without a will]
If you have no will, your estate will be distributed on your death in accordance with the laws set out in the Ontario Succession Law Reform Act. If you have a surviving spouse and children, your spouse will receive the first $200,000.00, whether or not you are separated from your spouse and the spouse and children will divide the rest of your estate, with the percentage depending upon the number of children regardless of your relationship with those children.
Where there are no children, your spouse, whether or not you are separated may be entitled to your entire estate. If you leave no spouse or children, then your estate goes to your next of kin, determined by “degrees of consanguinity” (relationship) under the Succession Law Reform Act.
If you die without a will and any part of your estate passes to a child under the age of 18, that child's share will be administered on the child's behalf by the Ontario Office of the Public Guardian and Trustee, and the child will be given his or her share at age 18.
Our lawyers know that wills and estate proceedings can be a tough time. We are happy to assist with any legal concerns, call us at (613) 232-7900.
Wills & Estate Law
Testate Succession (dying when you have a will)
Subject to your spouse's right to an “equalization payment” under the Ontario Family Law Act, you may deal with your affairs on your death in whatever manner you consider best. Having a Will will enable you to:
- Implement a tax structured estate plan
- Designate the person or persons who will administer your estate as Estate Trustee (Executor)
- Grant to your Estate Trustee a wide variety of powers in dealing with your estate. These might include the power to defer distribution of your estate, to invest assets of your estate, to sell assets of your estate and reinvest the proceeds, to distribute assets to beneficiaries in the form in which they were on your death, to borrow money on behalf of the estate and to make elections under the Income Tax Act (Canada)
Specify how and who will administered your estate for the benefit of minor beneficiaries [for example children], or other venerable beneficiaries [for example old parents or disabled adult children or other loved ones], including:
- who will act as trustee for minor/venerable beneficiaries
- whether monies can be paid either on account of income, principal or both, to minor beneficiaries prior to their age of majority
- whether monies can be paid to the parent or guardian of a minor/venerable beneficiary for the benefit of the minor/venerable beneficiary
- at what age a minor beneficiary will be entitled to his or her share of your estate, either in installments or at one time
- Specify who will receive your personal and household effects.
Updating Your Will
There are numerous circumstances which might warrant a review and possible revision of your will and estate plan. Although a carefully drafted will should contemplate the possible death of a beneficiary or estate trustee, the death of an estate trustee or of a principal beneficiary might justify redrafting the will.
And although the choice of estate trustee may have seemed advisable when the will was drafted, if circumstances change, either because of the relocation of the proposed estate trustee or the declining health of the proposed estate trustee, or if you loss trust in your estate trustee, it might be advisable to draft a new will with a new estate trustee.
Also according the current laws In Ontario, marriage revokes a Will unless certain preconditions are met. On the other hand, a divorce does not have the same effect. Similarly, a separation warrants a review of your will and estate plan. Also, where tax planning has formed a significant factor in the structure of your estate plan, a periodic review of the estate plan in light of changing tax rules is advisable, as the rules with respect to capital gains, tax free transfers, exemptions, preferred beneficiaries, etc. may change from time to time.
Powers of Attorney
The Ontario Substitute Decisions Act creates two types of powers of attorney.
Power of Attorney for Property
A Power of Attorney for Property (also known as a General Power of Attorney) will enable the person designated in the power of attorney to look after your financial affairs including bank accounts, investments, real estate, other property, etc., subject to any restrictions that you elect to include in the power of attorney.
The powers conferred by the power of attorney may be exercised at any time, but are generally intended to enable the designated person to administer your affairs during any subsequent incapacity, however, a power of attorney may also be used to enable someone to deal with your affairs while you are travelling or otherwise unavailable.
Power of Attorney for Personal Care
The second type of power of attorney is a Power of Attorney for Personal Care. This enables the designated person to make decisions regarding care and medical treatment when you are unable to do so due to incapacity.
Although the Substitute Decisions Act enables a court to appoint a guardian for property or for personal care, it is not necessary to apply to the court for such purpose if an attorney has been designated under a power of attorney. If there is a dispute, your power of attorney is clear guidance to the court of your preferences regarding the choice of guardian of your care and property.
