Many people are unaware of the most fundamental issues with respect to their estate. Here are some basic points that everyone should be aware of:
- Everyone should have a will. If you do not have a will, there are rules, case law and statute law, which determine how your estate will be distributed. This is known as an “intestacy”. Should you wish to have some say and control over your estate, you must have a will.
- Should you prepare a subsequent will, the new will should always contain a standard clause which nullifies and makes void any prior will.
- A person can make a valid will (called a holograph will) by writing it out entirely by hand, dating it, and signing it immediately below. No witnesses are needed. This is not advisable and we specifically recommend that you never do this unless you are facing immediate death and there is no alternative. It is very difficult to fully comply with the legal requirements necessary when preparing this kind of will.
- A person may create a new will, changing their estate distribution significantly, without advising anyone. This is particularly relevant for parties who are divorcing. In a separation agreement a divorcing couple can make any sort of agreement which they wish concerning wills, but with respect to their wills, immediately thereafter either of them can change it without the other party being aware.
- If you are married and your spouse dies, you can elect to take equalization of net family property, or to take what you are given under the will (or what you would receive under the intestacy).
- Intestacy will only operate and result in an inheritance if you are married. Otherwise, there must be a will.
- Property can be held in conjunction with another person in a number of different manners, the most common being joint tenancy or tenancy in common. Upon death of a party, joint tenancy dictates that the surviving party becomes the sole owner of the property. A will need say nothing on that point. Tenancy in common specifies the percentage interest that each party has. For example, if the parties decide that they will each hold a 50% interest in the property (referred to as an “undivided interest”), upon the death of one party the other party does not become the sole owner of the property. Rather, the deceased party’s interest devolves to their estate.
- A will must be abundantly clear in what it purports to do. It should be drafted with a mind to how people will act after your death. You should assume that there will be a dispute unless you draft everything so clearly that there is no question that can be made an issue in a litigation proceeding.
- A trust can sometimes be a helpful vehicle, assisting in dealing with your estate.
- A spouse may be eligible for some government benefits in the event of the other spouse passing.
- For the purpose of equalization of net family property in a divorce, anything that a person receives as a beneficiary under a will, is exempt.