Tax & Estate Planning

Estate Planning in Uncertain Times

By May 15, 2020 May 25th, 2020 No Comments
Tax & Estate Planning

Estate Planning in Uncertain Times

Caution: Documents prepared at home may not be effective in achieving your wishes

Posted by: Britta Graversen | May 15, 2020 | Filed under: Estate Planning

PLEASE NOTE: Since the date of this post, the Province of Alberta passed a Ministerial Order regarding virtual witnessing of estate planning documents, which impacts the options available during this time. Please see our post on that topic dated May 25th, 2020 for additional information.

Everyone speaks about all the “extra time” we have on our hands these days, but I have personally found that, in many ways, it feels like there are even less hours in the day. I imagine that many of our clients (I’m picturing: small business owners, couples with one or both partners working in essential services, parents of young children, grandparents who are now helping with childcare, and high-net worth families with both business and charitable endeavors, among others) relate to this feeling. However, having an estate plan in place is important and has recently become top-of-mind for many. We understand that the process can be overwhelming, particularly if preparing documents for the first time. Our goal is to make the process as painless and efficient as possible.

During these uncertain times, we have been assisting new and existing clients with navigating the options available to create or update estate planning documents, while respecting physical distancing measures. I hope to address some of the most common questions below.

Can I complete the entire estate planning process over the phone or via video conference?

Although this may change in the future, as of the date of this post, Alberta has yet to implement virtual witnessing for estate planning documents, which could allow for Wills, Enduring Powers of Attorney, and Personal Directives to be validly signed and witnessed via video conference. Accordingly, we must be creative to ensure we comply with required formalities while maintaining physical distance.

A formal Will requires two witnesses. Enduring Powers of Attorney (“EPAs“) and Personal Directives (“PDs“) require at least one witness. Witnesses cannot be people named in the documents themselves (i.e., a witness cannot be: your Personal Representative appointed in your Will, a beneficiary of your estate under your Will, a spouse of a beneficiary, your Attorney appointed in your EPA, or your Agent appointed in your PD). During a typical in-person signing meeting, we also complete affidavits of execution, which need to be notarized. If you are in good health and have not recently traveled, one of the best options to ensure your documents are legally effective, continues to be an in-person signing meeting (with your lawyer and an additional witness from our office). We note that our Estates and Trusts group is currently conducting all other meetings remotely, either via phone or video conference. Therefore, prior to an in-person, physically-distanced signing, you would have reviewed, discussed, and approved of a final draft of your documents.

What if I don’t feel comfortable with an in-person, physically-distanced signing?

 We certainly understand. An in-person, physically-distanced signing will not make sense for many people at this time. Although it might not be possible to comply with all usual formalities, other options are available. For example, if a person is living in a health care facility, self-isolating with unrelated roommates, or would be comfortable arranging to meet with trusted neighbours outside, it may be possible to review documents together over video conference and then send copies to be signed and witnessed. Depending on the circumstances, we would likely recommend that you attend our offices for a traditional signing, where all formalities are attended to, once circumstances allow.

If it is not possible to meet in person with anyone, signing a Will without witnesses may be an option to consider. Notably, during the probate process, an application would need to be made to the Court to rectify the lack of witnesses, which would increase the cost of administering your estate. Additionally, it is not guaranteed that the Court would approve such application. In particular, if the pandemic passes and you have the opportunity to update your Will but do not do so, it may be more difficult for the Court to elect to rectify the deficiency. Once possible, a traditional in-person signing should be scheduled to ensure you have a valid Will in place.

Can’t I just write out a Will myself or update my current Will on my own?

You may have heard of a Holograph Will, which is a handwritten Will signed by the Will-maker alone. Holograph Wills are allowed in Alberta if they meet certain requirements. Wording is important; there may be unintended consequences if a lawyer is not consulted with respect to the language used. A Holograph Will is not likely to be a good option for someone who is preparing estate documents for the first time: the entire Will (numerous pages) would have to be written out in their own handwriting and, perhaps more significantly, Alberta legislation does not provide for Holograph EPAs or PDs.

However, a Holograph Will may be an appropriate measure if you have an existing Will that needs minor updates. In such circumstances, we can provide instructions with sample language but, again, we would likely recommend that you attend our offices for a formal signing once circumstances allow.

Alberta legislation allows for two specific types of Wills, either a formal document with two witnesses or an entirely handwritten document. Marking up an existing Will with desired changes creates a document that does not fall in to either category. This is a common issue with pre-packaged Will kits as well. We strongly recommend reaching out to a lawyer if you are considering updating your existing Will or other estate planning documents.

Dying Intestate: What happens if I don’t have a Will or my Will is invalid?

If you do not have a Will currently in place, your estate will be distributed in accordance with the rules for the distribution of intestate estates. There are many Alberta-specific intestacy flowcharts available online and we are happy to answer specific questions in this regard.

We acknowledge that, depending on your circumstances, doing nothing may be a reasonable option.

However, even if you are satisfied with how your estate would be distributed under the intestacy rules, you may need a Will for other reasons. For example, do you have minor children or any other dependants? (You may need to name guardians and/or specify trust terms.) Do you have certain gifts that you would like to be made prior to the rest of your estate being distributed? Do you have certain family members who you wish to specify are not to inherit? Would you like to make a donation to charity on your death?

No matter your personal circumstances, our Estates and Trust team at Nerland Lindsey LLP would be pleased to guide you through the estate planning process. We are working remotely but remain available to assist with your estate planning needs. 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 cattwood@nerlandlindsey.com.

Disclaimer:

Please note that the foregoing is Alberta-specific 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.

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