Estate planning changes in Ontario

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    Under this bill the Inheritance Reform Act and Substitute Decision Act both were changed to allow remote witnessing of wills and powers of attorney. Virtual signing was temporarily permitted last spring after the outbreak of the COVID-19 pandemic and is now a permanent option for lawyers and clients.

    As it has become more convenient for people to do business with professionals from a distance, this could have interesting ramifications. A real estate attorney in Timmins, Ontario can now do business with Toronto-based clients more easily. Also, given the efficiency and simplicity of remote meetings with attorneys who prepare them, there may be less hesitation in obtaining a will or power of attorney – legal documents that so many people do not have.

    Bill 245 also changed a section of the law reforming inheritance law, which resulted in wills being invalid upon marriage. This change is especially important given all of the subsequent marriages and second marriages that, up to this point, have resulted in a will being revoked in Ontario unless specifically made into consideration of that marriage.

    Ontario wills made before marriage can now be valid after marriage. However, getting married can affect a surviving spouse’s family law claims for death as well as tax planning. Therefore, professional advice before a wedding can still be prudent.

    Another marital change to Ontario estate planning as a result of Bill 245 involves separated spouses. If spouses are separated but not yet divorced at the time of a testator’s death, the surviving spouse does not have standard property rights. The will is to be interpreted as if the former spouse were also dead, as long as the spouses lived apart and separated for at least three years and a separation agreement or a court settlement existed.

    An additional amendment to the law to reform the successor law earlier this year also increased the entitlement of a surviving spouse in the case of a person who dies in the bowel. Previously, if someone died without a will in Ontario, the first $ 200,000 of their estate would go to their spouse. That was increased to $ 350,000, with half of the surplus going to the surviving spouse and half going to the deceased’s children. While this is welcome news for surviving spouses, the best way to ensure that the estate wishes are granted is with a valid and current will.

    One final and important change that comes from Bill 245 is to give the courts the power to validate a will or power of attorney, even if not properly executed. That power would apply if the Supreme Court were satisfied that the document adequately set out the intent of the deceased.

    Professionally, I recently had experience with a power of attorney for property signed by both spouses prior to one spouse’s incapacity. As a result, the document was deemed invalid. The resulting process of appointing someone to power was stressful and expensive. I have heard of cases where a technical error in a will resulted in a will being deemed invalid, and the rules of intestity decided the distribution of the estate, rather than that direction that emerged from the final wishes in a will . This new section 21.1 of the Inheritance Reform Act could provide leniency in similar circumstances.

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