A. Beth Moore, B.A., LL.B.

When You Need A Lawyer: Making a Will

Making a Will has legal consequences. This article explains what a Will is and why you need one. As your lawyer, I can assist you in deciding who to appoint as your executor/Estate Trustee and how your estate will be distributed. I will then prepare your Will and meet with you when you sign it to ensure that it is properly signed and witnessed.

Your Will and Your Estate Trustee

A Will is a legal document that sets out how your property and assets are to be distributed after your death. In Ontario an “Estate Trustee” is the person or persons appointed to administer your estate. The person you name as executor have the right to apply for appointment as your “Estate Trustee With A Will”. If you die intestate, the person appointed to administer your estate will be your “Estate Trustee Without a Will”. You may name two or more persons as your Estate Trustees.

What happens if you die without a Will?

If you die intestate (without a Will):

• your family members may receive less than you had intended and non-relatives will receive nothing
• your estate’s value may be reduced due to higher taxes
• the court may appoint someone you may not have chosen to administer your estate, and
• your children may obtain their shares upon reaching the age of majority, whether or not they can handle the responsibility.

Distribution of an Intestate Estate

In Ontario, the laws for distribution of an intestate estate are set out in the Succession Law Reform Act and are inflexible. The needs of your dependents and your wishes are not taken into account. After payment of taxes, debts, funeral costs and other liabilities your property goes to your surviving spouse and children in accordance with a rigid formula. If you are not survived by a spouse or children, other next of kin become your heirs. By having a Will, you can ensure that your family members will have their future needs met and your assets will be distributed according to your wishes and that a person you trust will be appointed as your Estate Trustee.

How long is a Will valid and can it be changed?

Your Will is revoked by your marriage unless it states that it has been made in contemplation of the marriage. Otherwise, your Will is valid until you revoke it, either by destroying it or by making a new Will. Divorce invalidates gifts made in your Will to your ex-spouse but not the Will itself.

You may change the terms of your existing Will by executing a ‘Codicil’. A Codicil is usually drafted for minor changes. If you are making major changes you should make a new Will and destroy your previous Will.

You should review your Will and amend or redo it when you experience a major life change (e.g. marriage, divorce, death of a family member or the birth or adoption of children or grandchildren).

Legal Requirements of a Will

To be valid, a Will must satisfy the following legal requirements:

• the Will must be written, dated and signed
• the testator of the Will must be legally competent and at least 18 years old
• the signing of the Will must be witnessed by two legally competent individuals (except for certain ‘holograph’ [handwritten] Wills).

The signed original of the Will must be kept in a safe and fireproof place, such as a safe or a safety deposit box, where it is protected. However, it is necessary for the Will to be accessible to the family of the testator at the time of death so a copy should be kept at home or given to the executor if the original is kept in a safety deposit box so that the executor can produce it to the bank staff in order to get access to the box in order to retrieve the original copy.

What should your Will include?

The provisions of your Will may:

• name one or more executors
• authorize your executor to pay your debts, funeral expenses, taxes etc.
• name beneficiaries (family members, friends or charities) of specific items of property or cash legacies
• name beneficiaries of your remaining property (the ‘residue’ of your estate)
• name alternate beneficiaries if a primary beneficiary has predeceased you
• set out provisions for testamentary trusts, and
• name guardians for your minor children.

Instructions about your wishes regarding organ donation and your funeral and burial arrangements may also be included but it is important that you advise your executor and family members of your wishes about these matters in case the Will is not found or referred to until after your funeral.

What is a Testamentary Trust?

A testamentary trust is a trust that is created in your Will. It takes effect on your death. The most common uses of a testamentary trust are to provide for the support and education of minor children and to provide for family members with disabilities. Testamentary trusts in favour of a spouse or adult child beneficiaries may also be used as a method of saving on income taxes.

Either your Estate Trustee or another person may be named as the Trustee of the trust. The Trustee manages the assets in trust for the benefit of the beneficiaries and distributes the income and capital according to the instructions in your Will. Spousal trusts are a special type of testamentary trust under which only your spouse may receive the income and capital during your spouse’s lifetime. Special types of trusts can also be established for heirs with physical or mental disabilities which do not jeopardize their access to government-funded benefits. Tax returns must be filed annually by all testamentary trusts.

Gifts to Charities

Making a charitable gift in your Will provides a way to support an organization whose work you value and to save taxes. A tax deduction of up to 100% of your income can be claimed in your final tax return for any charitable gifts made during the last year of your life or in your Will. As well, if you leave a gift of public company shares to a charity, no capital gains tax is payable on your capital gain on those shares.

Preparing to make your Will

On my web-site you will find a Personal Data Summary and Will Instructions form [link]. It may be helpful for you to complete the Personal Data Summary and review the Will Instructions form before meeting with me to give me your instructions. You do not need to complete the Will Instructions form before our meeting but reviewing it may help you to think about the various issues we will discuss when we meet.

Do-It-Yourself Wills

Your family will not thank you for saving money by doing your own Will if you make an error that has to be fixed at your estate’s expense after your death. Some examples of common errors are:

• having a beneficiary or a beneficiary’s spouse witness the Will (this voids the gift to the beneficiary unless a court order validating the gift is obtained)
• including provisions in the Will that are inconsistent or contradictory, necessitating a court application to have the Will corrected or interpreted
• leaving gifts to minor children without giving your Estate Trustee the discretion to use the gifts for the child’s benefit during his or her minority
• making changes to a Will after it has been signed and witnessed or adding new pages after the signing page (all of which are invalid).

Wills are important legal documents and need to be properly drafted and executed. Please contact me if you wish to meet to discuss your Will.