DYING WITHOUT A WILL
So, do you really need a Will? If you die without a Will, provincial legislation provides a scheme for administration and distribution of your estate, and a court will appoint an administrator. If there is a Will, then the executor under the Will may act almost immediately upon death; probate simply confirms the appointment of the executor under the Will.
Problems with a Court-Appointed Administrator
Without a Will, and before the appointment of an administrator by a court, no one is empowered to deal with the affairs of the deceased's estate. Because it can take weeks or months to appoint an administrator, the delay can be a serious problem if, for example, a business needs to be run on a continuous basis. Also, a spouse or close relative will usually apply to become the administrator of the estate, but it is possible that there could be a contest between multiple applicants, which could not only further delay matters, but also result in your estate in the hands of an administrator that you would never have appointed yourself.
An additional problem with the appointment of an administrator upon your death is that if there are children or mentally incapable beneficiaries without a nominee, the court may require security for the Administrator. Security might include a bond. A bond is insurance that the administrator will properly administer the estate and not defraud the beneficiaries. Potential administrators must be bondable and there is a cost involved. If no one will act as administrator of an estate, the Public Trustee may administer the estate for a fee.
Once appointed by a court, the administrator acts in a capacity similar to an executor under a Will. He or she will pay debts, funeral expenses, and taxes, as well as liquidate and distribute assets.
Distribution of Estate If Deceased Has No Will
When it comes time for an administrator to distribute the estate, it is distributed under a legislative scheme. For example, if you have a spouse and no children or other issue (blood descendants), then the entire estate goes to your spouse. The term "spouse" includes common-law spouses who meet the definition of "spouse," which is cohabitation with another person in a marriage-like relationship (including the same gender) for a period of at least two years immediately before the person's death. If spouses have been separated, the spouse may no longer qualify as a beneficiary.
You should be aware that there still could be significant legal issues as to whether someone is a "common-law spouse," whether someone is a separated spouse, or whether a former spouse has acquired property rights through other legal mechanisms. Legislation even contemplates there being more than one spouse. In these cases, hopefully rare, a judge decides who gets what.
If you have a spouse and children, the spouse gets household furnishings and either a preferential share of $150,000 or $300,000 depending on whether the deceased's descendants are common to both the spouse and the deceased. The spouse gets one-half of the remainder of the estate. The spouse may use the share to purchase the spousal home.
If you have children but no spouse, the estate is divided equally among the children. If you have no children or other descendants, and no father or mother, the estate is divided equally among the descendants of your parents, that is your brothers and sisters. If one of your brothers or sisters pre-deceased you, then that person's children receive his or her share.
Another significant issue for those of you with minor children is that if you die without a Will, you have not appointed a guardian. There could be a contest between potential guardians. As with the administrator, you could end up with someone being the guardian of your children that you would never have appointed.
Taxes and Probate Fees Without a Will
Dying without a Will is not likely to affect income taxes or probate fees. The only time the provincial government actually takes the assets of a person who dies without a Will is when no next of kin can be found or they are too remote in the order of descent. Even in these situations, people with a legal or moral claim may make an application to have the money paid to them.
So, you might not need a Will if your requirements are the same as the government scheme. This will be a rare situation, however, and legal advice is suggested. Reliance on the Wills, Estates and Succession Act could well be preferable to having a poorly drawn do-it-yourself Will. Just remember that proper estate planning always results in a smoother and more cost-effective transition for your heirs.
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