When Is Unequal Ever Fair?
By Ray Riddell QC
Your estate consists of everything you own at the time of your death. Some items that are owned jointly or have designated beneficiaries like life insurance, RRSP, homes and camps are not included in your estate. There is a great saving of probate fees and time because they pass automatically to the beneficiary. Some couples arrange for everything to be owned jointly so there is no need to go to Probate Court when one of them dies. Even if a car is owned in just one name, or a small bank account is in one name only, they may be transferred without going to Probate Court if there is a valid will.
A good rule to remember is the smaller your estate, the smaller the probate fees. A lawyer, banker or financial planner can be very helpful in making sure you pay less money to the taxman.
When you have a list of your property, you need to write down in plain English in your own handwriting your instructions as to who gets what (beneficiaries), who handles your estate (executor) and who will look after your infant children (guardian). Money given to children is held in trust by a person called the trustee. The trustee, executor and guardian may be the same person but many think that separating the roles is better since two heads are better than one. If you sign your instructions at the bottom of the sheet of paper you have made a will. You do not need any witnesses. You can also take these instructions to a lawyer and have a formal will prepared and signed by two witnesses. Your lawyer may have some helpful advice and if you give the lawyer your instructions before you meet it will save time and money.
For most couples, the decision is simple. Most couples leave everything to each other and appoint the survivor to handle the estate (executor). The spouse is familiar with the financial details and will usually be supported by family and capable advisors when necessary. It is important to have a back up plan in case your spouse dies before you or at the same time. In that case it is common to appoint a backup executor to handle the estate and to lay out a backup plan for dividing their estate.
Most commonly, but not always, the surviving parent will leave everything to the children. The children may be infants and in that case there are some additional considerations such as appointing a trustee to look after the money.
If all of the children are adults the best way to create a future battleground is to treat children unequally. More family disputes happen after the death of a parent and the majority of those disputes result from a perception of unfairness. Money from an inheritance can increase the quality of life and open up opportunities that could not have been possible before, but human traits such as greed and anger can be magnified and without Mum or Dad around to settle the squabbles, brothers and sisters may never talk to each other again.
Parents who treat adult children unequally claim to have good reasons. One child may be in need and another well off. Unfortunately, life changes and what you see now may change and roles could be reversed. Parents may also want to punish a child for something done in the past. A will is not the place or time to do that. I knew of one widow who actually cut off her son because he did not show up for Mothers Day. She did not imagine the permanent damage she caused to her family. Dividing the estate equally among the adult children and appointing them all as executors reduces the chances of an all out war.
Ray Riddell QC is a resident of Woodmans Point, NB. He practised law in Halifax, Nova Scotia for 30 years with particular focus in probate, property, labour law and civil litigation. He is presently on sabbatical.
Ray Riddell QC
Your estate consists of everything you own at the time of your death. Some items that are owned jointly or have designated beneficiaries like life insurance, RRSP, homes and camps are not included in your estate. There is a great saving of probate fees and time because they pass automatically to the beneficiary. Some couples arrange for everything to be owned jointly so there is no need to go to Probate Court when one of them dies. Even if a car is owned in just one name, or a small bank account is in one name only, they may be transferred without going to Probate Court if there is a valid will.
A good rule to remember is the smaller your estate, the smaller the probate fees. A lawyer, banker or financial planner can be very helpful in making sure you pay less money to the taxman.
When you have a list of your property, you need to write down in plain English in your own handwriting your instructions as to who gets what (beneficiaries), who handles your estate (executor) and who will look after your infant children (guardian). Money given to children is held in trust by a person called the trustee. The trustee, executor and guardian may be the same person but many think that separating the roles is better since two heads are better than one. If you sign your instructions at the bottom of the sheet of paper you have made a will. You do not need any witnesses. You can also take these instructions to a lawyer and have a formal will prepared and signed by two witnesses. Your lawyer may have some helpful advice and if you give the lawyer your instructions before you meet it will save time and money.
For most couples, the decision is simple. Most couples leave everything to each other and appoint the survivor to handle the estate (executor). The spouse is familiar with the financial details and will usually be supported by family and capable advisors when necessary. It is important to have a back up plan in case your spouse dies before you or at the same time. In that case it is common to appoint a backup executor to handle the estate and to lay out a backup plan for dividing their estate.
Most commonly, but not always, the surviving parent will leave everything to the children. The children may be infants and in that case there are some additional considerations such as appointing a trustee to look after the money.
If all of the children are adults the best way to create a future battleground is to treat children unequally. More family disputes happen after the death of a parent and the majority of those disputes result from a perception of unfairness. Money from an inheritance can increase the quality of life and open up opportunities that could not have been possible before, but human traits such as greed and anger can be magnified and without Mum or Dad around to settle the squabbles, brothers and sisters may never talk to each other again.
Parents who treat adult children unequally claim to have good reasons. One child may be in need and another well off. Unfortunately, life changes and what you see now may change and roles could be reversed. Parents may also want to punish a child for something done in the past. A will is not the place or time to do that. I knew of one widow who actually cut off her son because he did not show up for Mothers Day. She did not imagine the permanent damage she caused to her family. Dividing the estate equally among the adult children and appointing them all as executors reduces the chances of an all out war.
Ray Riddell QC is a resident of Woodmans Point, NB. He practised law in Halifax, Nova Scotia for 30 years with particular focus in probate, property, labour law and civil litigation. He is presently on sabbatical.
January 28th, 2010 at 1:10 am
Hi, I am looking for some advice, but also letting you know when someone dies without a will there are all kinds of complications. Two years ago my sons father died without a will, their father and I had not been together in 12 years at the time of passsing my sons were 17 and 19. Their father also had a long time girlfriend whom he never married. After he passed away the girlfriend remained in the house and tried to get the boys to sign off their rights to the property. The phone and power are still under a deceased persons name which we are still in the process of trying to get disconnected,the truck that their father owned was somehow changed to her name after he died. and it has all just been a huge mess.by the way the house that is part of the estate was given to the boys father from my side of the family only 4 years ago under the understanding that it would go to my sons if anything happened (the boys father was ill at the time). My oldet son just got named as the excutor. where do the boys go from here?