Wills and Estates

1. Wills and Estates In partnership with Edmonton Public Libraries

2. Disclaimer The information presented during this session may have limited application to your particular situation. The lawyer or law student that are here this evening CAN provide legal information that may give you a greater understanding of how the law might apply to your own situation. The presenter here this evening CANNOT provide you with individual legal advice.

3. Estate Planning Tools • Will • Enduring Power of Attorney • Personal Directive

4. Wills Overview • What is a Will • Advantages in making a Will • Wills and Succession Act • Requirements of a valid Will • Who can make a Will • Effect of Marriage and Divorce • Limitations on Testamentary Freedom • Proving a Will • Court Powers • Executor • What happens if you don’t have a Will

5. What is a Will? • Lets you make decisions that will be carried out after your death • A legal document containing a person’s wishes concerning how your estate will be distributed and who will be responsible for the distribution

6. What is an Estate? • Land, assets, bank accounts in your name alone and insurance payable to your estate • Property not forming part of your estate includes joint property owned by spouses, and life insurance, RRSP’s, and pensions where the estate is not the named beneficiary • (key phrase: Designated Beneficiary)

7. Wills and Succession Act (WSA) • Effective February 2012 • Repealed and replaced: • Wills Act • Survivorship Act • Intestate and Succession Act • Dependants Relief Act • Section 47 (pension plans and funds) of the Trustee Act

8. Requirements of a Valid Will • Formal Will – section 15 of WSA • In writing • Signature of the testator • Testator makes or acknowledges signature in the presence of 2 witnesses present at the same time • Each of the witnesses signs the will in the presence of the testator • Witness should NOT be a beneficiary or his/her spouse

9. Requirements of a Valid Will • Holograph Will – section 16 WSA • Wholly in the testator’s own handwriting and signed by the testator

10. Who Can Make A Will? • Section 13 of WSA • 18 years of age • Mental capacity • Under 18 if certain conditions are met

11. Advantages of Making a Will • You can exercise choice over YOUR: • Executor • Beneficiaries (charities, dependents) • Trusts for minor children (delayed gifts) • Trustee for the trusts • Guardian for minor children • Potentially less conflict amongst family • Tax and legal implications

12. Limitations on Testamentary Freedom – Family Maintenance and Support • Family members can apply for support from the deceased’s estate. Family members include: • Spouse, minor children, dependent adult children • An adult child under age 22 who is a full time student • A grandchild who depends on a deceased grandparent or great grandparent

13. Executor • Locates assets • Pays funeral costs, debts and taxes • Distributes remaining money and property according to will • Is accountable to the beneficiaries • For more complex estates, may need professional advisors-lawyers and accountants

14. Executor • Can choose any adult you wish • Best suited if: • Is trustworthy, reliable and competent • Basic knowledge of business • Most often a family member, a beneficiary or trusted friend • Can also be a trust company

15. Effect of Marriage and Divorce • Marriage or an adult interdependent agreement – section 23 of WSA no longer revokes a will • Divorce – section 25 of WSA – revokes a gift, also voids appointments to the ex spouse

16. Example – Divorce • Bill and Sue are married • Bill leaves his convertible to Sue and appoints her as executor • They divorce after February 1, 2012 • Bill dies • Sue does NOT get the convertible and is NOT the executor

17. Proving a Will (Probate) • After death, a will is submitted to the Surrogate Court for “probate” • A process whereby the court verifies that the will is valid and confirms the appointment of the Personal Representative (PR) • PR will need probate before dealing with property • For more complex estates , the PR may need professional advisors – lawyers, accountants

18. Court Powers • Courts may admit outside evidence to establish testator’s intention (s.26) • Courts may validate improper wills and alterations (sections 37 and 38)

19. What Happens Without a Will • An intestacy is defined in WSA as “an estate, or any part of an estate, that is not disposed of by a will” • Someone with an interest in the estate must make an application that appoints him/her as the “administrator” • Administrator has the same duties and powers as the executor

20. What Happens to the Estate • Part 3 WSA Estate goes to immediate family: • Examples: • If you leave a surviving spouse or AIP and no descendants – all to the spouse/AIP – section 60 • If you leave a surviving spouse or AIP and ONLY descendants from that relationship – all to the spouse/AIP – section 61

21. Example – Spouse plus children from other relationship: • Spouse/AIP gets “preferential share” –greater of prescribed amount ($ 150,000) or 50% of the net value of estate • Rest divided equally among the surviving children and deceased children who left surviving descendants

22. Example - Spouse and AIP at the same time – section 62 of WSA • William and Kate are married with two children • William leaves Kate to live with Camilla and has a child within a year (AIP formed) • William dies intestate • Kate and Camilla divide preferential share • Residue –each child takes 1/3

23. Example - Separated Spouses- section 63 of WSA • William and Kate are separated for more than two years or have a court order settling affairs • William dies intestate • Kate is disinherited (separated spouse deemed to have predeceased)

24. Example- Separated Spouses with Children- section 63 of WSA • William and Kate are separated for more than two years (or have a court order settling affairs) with two children • William dies intestate • Kate is disinherited (separated spouse deemed to have predeceased) • Residue – each child takes 1/2

25. Unclaimed Personal Property and Vested Property Act • If there is no family or relatives as set out in the WSA, then the Unclaimed Personal Property and the Vested Property Act comes into play. • If a person dies without a will, after 2 years from the grant of administration, the Administrator must give the Provincial Government any portion of the estate not claimed by a valid heir. • The Provincial Government must keep this property/ equivalent value for 10 years. If no one comes forward to claim it within 10 years, then the property belongs to the Government.

26. Helpful Resources • Centre for Public Legal Education has a booklet on things to do and consider when creating a will: http://www.cplea.ca/ • The full version of the Wills and Succession Act can be found on the Alberta Justice & Solicitor General website: http://justice.alberta.ca/programs_services/wills/Pages/default.aspx

27. Planning For Incapacity • Powers of Attorney Act • Personal Directives Act

28. Powers of Attorney Act • Allows for a Power of Attorney (POA): • A document where you (the donor) authorizes someone (the attorney) to deal with property on your behalf. • One of the difficulties with the standard Power of Attorney is that it automatically ceases to have effect if the donor becomes incapacitated. • The legislation allows an attorney to continue to act notwithstanding future mental incapacity. This document is called an Enduring Power of Attorney (EPA).

29. An Enduring Power of Attorney Must Be… • In writing • Dated • Signed before a witness • If donor is physically unable, then signed by another person at the donor’s direction in the presence of the donor and witness • Statement that either • the POA is to continue despite any mental incapacity or infirmity of the donor that occurs after the execution of the POA, or • the POA is to take effect only on the mental incapacity or infirmity of the donor (a “springing” enduring POA)

30. Key Points • Must have mental capacity • Authority terminates: • On death of donor or attorney • If a trustee is appointed • If revoked by the donor who has capacity • Attorney vs. Trustee under the Adult Guardianship and Trusteeship Act • Court order takes time, more expensive, not a private affair • Court decides who will be the trustee

31. Personal Directives Act • Provides for a Personal Directive which is a legal document that you write in case something happens and you cannot make your own personal decisions in the future • Non-financial decisions • Example: healthcare, where to live etc. • Donor appoints an agent • Must be in writing, dated signed before a witness • Agent vs. Guardian under the Adult Guardianship and Trusteeship Act

32. Helpful Resources • Centre for Public Legal Education has a booklet on things to do/to consider when writing a Power of Attorney: http://www.cplea.ca/ • Information and forms for Personal Directives from Service Alberta website: http://humanservices.alberta.ca/guardianship-trusteeship/opg-personal-directives.html

33. Edmonton Community Legal Centre • Offers free legal advice to low-income individuals and families on matters such as: • Estates • Small claims • Landlord-tenant disputes • Immigration law (including issues related to temporary foreign workers) • Human rights concerns • Employment law • Debt law • Income support appeals • Possible to obtain lawyer to help create Will for free or at reduced cost • Call (780) 702-1725 or visit www.eclc.ca

34. Lawyer Referral Service • Telephone service • Can give you the names and telephone numbers of three lawyers who can help you with your situation • No charge for first 30-minute interview – after that can choose whether to pay lawyer for further services • Call 1-800-661-1095

35. Questions