Over the last year-and-a-half, Canadians have experienced significant changes in both their day-to-day lives as well as more significant aspects of their lives, such as health and employment. The legal profession has also had to adapt to COVID-19 and coming out of the most serious phase of the pandemic, some of the once temporary changes to estate law are ready to be made permanent through amendments to Ontario’s Succession Law Reform Act. The Act also introduces new measures which should have a significant impact on how estates are managed.
Virtual will signing is now permanent
With COVID-19 making it difficult for people to meet in person, a temporary measure was put in place in 2020 to allow witnesses to review a will over audio-visual technology and then sign their own, identical copy of a will. Each individual’s copy of the will would then be sent to a lawyer, who would collect and compile them.
While this was originally going to be a temporary measure, it is now an approach to will signing that will be available on a go-forward basis.
Making it easier to manage small estates
While large estates are what normally make headlines, most people have fairly simple estates, perhaps made up of a home, personal property, and bank accounts.
As of April 1, 2021, estates not valued at more than $150,000 are eligible for the small estates probate process, which allows for the estate to be distributed more quickly than larger, complex estates. This option is available for estates with wills as well as for those without.
An increase to preferential shares
Any lawyer would tell you that it’s extremely important to have a valid will in place, but the truth of the matter is that many people don’t have wills. Prior to March, if someone died without a will, their spouse would be entitled to $200,000. That amount has now been increased to $250,000.
In cases where there are no children, a spouse could expect to receive the entire estate. What preferential shares do in situations where people have children is provide the surviving spouse with up to $300,000 and divide the rest up amongst the surviving spouse and children.
How marriage and separation impact wills and estate distribution
Up until the changes to the Act, if someone had a will in place prior to marriage, the marriage would automatically revoke any older wills. The Act now states that wills signed before someone is married are still valid. This means that anyone who wishes to include their spouse in their will (assuming they are not already included), they will have to update their will to include their spouse as a beneficiary.
Going back briefly to the topic of preferential shares, once a couple separates, the surviving spouse will no longer be entitled to their preferential share. This change comes into force on January 1, 2022. As of right now, a divorce is needed in order for preferential shares to be automatically rescinded.
The curing of invalid wills
If you’ve read our blogs, you’re likely aware that one of the most common issues experienced with wills are those related to their validity. Once someone dies, it’s obviously impossible for them to fix their will, and something like a missing witness signature might mean that an otherwise valid will cannot be enforced.
As of January 1, 2022, courts will be able to “cure” wills that have small flaws. This includes instances where only one witness signs a will, but two witnesses were present.
If you have been appointed a trustee, executor, attorney for property, or attorney for personal care, contact Derfel Estate Law to speak with an estates lawyer. We regularly provide guidance to fiduciaries to ensure they are carrying out all of their obligations and making decisions that are in the best interests of testators or grantors, while minimizing the fiduciaries’ legal risks. Call us at 1-844-2-DERFEL or contact us online to schedule a consultation.