Do You Need to Update Your Will?
We often discuss the importance of putting a Will in place. However, in some cases, having an out-of-date Will may be more problematic than not having a Will in place at all. The following example is illustrative.
Ali’s Current Will
At the time the Will was drafted, Ali was married to Brett. They had two children, Austin (12) and Blake (15). A lawyer prepared mirrored Wills (i.e. two individual, almost identical Wills, where the terms of each Will reflect those of the other). Both Wills have the following terms:
· The surviving spouse is to be appointed as Personal Representative.
· Brett’s sibling, Morgan, is selected as an alternate Personal Representative, due to a background in accounting.
· The surviving spouse is named as a guardian for Austin and Blake. Morgan is named as an alternate guardian.
· On the death of the first spouse, all assets are to be distributed to the second spouse.
· On the death of the second spouse, all assets are to be split between Austin and Blake (to be held in trust for each child until they reach 21 years of age).
What Might Prompt Ali to Review the Will?
· New Child or Grandchild.
o If Ali and Brett have another child, their Wills should be reviewed. Depending on the wording used in the existing Will, their estate may be split amongst Austin and Blake specifically, rather than all their children, unintentionally excluded the new child. If needed, options would be available to provide such child with a fair share – but most of those options would require a Court application. The simplest and most cost-effective option would be updating the Wills.
o Similarly, depending on the wording used in the existing Will, a grandchild might not automatically become a contingent beneficiary.
o Further, if Ali wished to provide a specific gift to such grandchild or establish a trust for such grandchild, the Will would need to be updated accordingly.
· Successful Business Venture.
o In addition to considering how the business assets are to be dealt with on death, if Ali’s estate has grown significantly from the time the existing Will, the entire estate plan should be reviewed.
o Among other things, Ali may wish to increase the age that funds would be distributed to the children from trust, from 21 to 30 (or any other age), and provide that funds can be distributed ahead of age 30 for the purpose of education, medical need, or for a down payment on a home.
o If Ali and Brett get a divorce judgement, Ali’s Will would be interpreted as if Brett predeceased Ali, unless Ali’s Will specifically indicated otherwise. Brett would not be entitled to receive all of Ali’s estate and Brett would no longer appointed as a Personal Representative or a guardian of the children.
o However, depending on the circumstances, Ali may still wish for Brett to named as a desired guardian of the children, ahead of Morgan.
o Additionally, depending on Ali’s relationship with Morgan, Ali may wish to remove Morgan as Personal Representative, desired guardian, or both (or simply to add a person ahead of Morgan).
o The death of Brett would prompt similar considerations as above. Regardless of whether Ali wishes to keep the references to Morgan, at least one further alternative should be added.
o The death of Morgan would remove the alternative Personal Representative and guardian. While an update in such circumstances may not be considered as urgent, if Ali and Brett were to both pass prior to updating their Wills, someone would have to apply to the Court to administer their estate(s). Such person would likely be Blake or Austin if they had reached the age of majority. In such circumstances, Ali would not have a say as to who administers the trusts set up for the children.
o If Ali and Brett were separated but not yet divorced, Ali’s Will would be read as-is. An update to remove Brett would likely be desired.
The are numerous other life events that could have an impact on one’s estate planning. Please see our non-exhaustive list of circumstances that should prompt a review here. https://nerlandlindsey.com/when-to-review-your-estate-plan/
If any change of circumstance has occurred since the time your Will was originally drafted or if five years or more have passed, you may wish to review your Will with a lawyer. Depending on the circumstances, your Will, Enduring Power of Attorney and Personal Directive may need to be updated or revised in their entirety.
No matter your personal circumstances, our Estates and Trust team at Nerland Lindsey LLP would be pleased to assist you with the estate planning process. Our team consists of both Alberta and British Columbia lawyers. If you would like to discuss this article in greater detail, or would like assistance with any estate planning matter, please contact Catie Attwood at (403) 984-0378 or firstname.lastname@example.org.
Please note that the foregoing is information for general discussion purposes only and should not be construed as legal advice to any one person or company. If the issues discussed herein affect you or your company, you are encouraged to seek proper legal advice.
1. Wills and Succession Act (Alberta)
2. Estate Administration Act (Alberta)