Although getting a Will done ranks right alongside a trip to the dentist, having an up-to-date Will is an expression of caring that can ease the sorrow of your passing. Dying without a Will leaves your grieving loved ones puzzling over why you didn’t care enough to get it done and wondering how to deal with the resulting chaos.
For some of us with few assets and if no one is expecting to have access to our assets, Ontario’s intestacy laws (how an estate is distributed upon death if there is no Will) may be enough. For example, if a married person dies without kids and having most assets jointly-held with his or her spouse, the surviving married spouse gets it all. If the deceased was single and never had kids, his or her parents share the estate. However, having died without a Will means that it will take longer to access the assets and settling the estate will require more time and money.
The distribution dictated by Ontario’s intestacy laws is, in our experience, rarely what people expect and may come as a bit of a surprise. For example, Chris’ marriage ended three years ago but no separation agreement was ever signed. A year ago, Chris’ unemployed girlfriend moved into his house and she was never added to the title. Chris never had children. Chris was living in a common law relationship at the time of his unexpected death. Chris never signed a Will. Under Ontario’s intestacy laws, Chris’ estranged wife will likely get everything. Although his common law girlfriend may have a right to support and possibly a right to claim against some portion of his estate under a constructive trust argument, a costly court battle may be necessary to establish such claims. She has no automatic right to any of Chris’ assets other than to any assets they may have owned jointly or as a named beneficiary on life insurance policies or RRSPs or RRIFs.
Anyone in a blended family (second marriages or a relationship with any combination of ‘yours, mine, and ours’ offspring) should be particularly concerned about the results of dying without a Will or without an up-to-date Will. Many do not realize that marriage nearly always revokes a prior Will; however, the new spouse could opt to let the Will stand. In our experience, this is unlikely if the new spouse is not mentioned in the Will. Without a Will, the new spouse will inherit $200,000 plus either one-half or one-third of the deceased spouse’s estate. If the deceased had just one child, the amount of the estate over $200,000 will be shared 50-50 between the deceased’s child and the surviving spouse. If the deceased had two or more children, the amount of the estate over $200,000 is shared one-third for the surviving spouse and two-thirds shared equally among the deceased’s children.
An important point: a deceased’s estate does not include jointly-owned assets if there is a surviving joint owner nor does it include life insurance, RRSPs, RRIFs or similar assets for which there is a named living beneficiary. When a marriage ends, both spouses should review and update beneficiary designations promptly and should consider whether jointly-owned assets should be divided or transferred to one spouse’s name or the other.
Often the single most valuable asset that a couple own is the family home and/or cottage. If located in Ontario, the title of such real estate can be changed from one form of joint ownership (joint tenants) to another form of joint ownership (tenants-in-common) which would ensure that half the value of the property would pass on death to the deceased spouse’s estate and not to the surviving estranged spouse. This is a step, referred to as ‘severing the joint tenancy’, that can be taken without the consent or knowledge of the other joint owner.
Reproduction of this blog is permitted if the author is credited. If you have questions or if you would like more information, please call us at 613 836-9915. This blog is not intended to be legal advice but contains general information. Please consult a lawyer or other professional to determine how the information in this blog might apply to you.
Blog posts pre-dated December 1, 2015 were originally published under Neff Law Office Professional Corporation.
