How Do I Choose My Estate Trustee (Executor)?

By Bethany Anderson

The person you select as an estate trustee (executor) will depend on a number of factors.  Spouses often appoint each other, but need to consider an alternate estate trustee for after both spouses have passed away, or in case the surviving spouse has become incapable.

There are some qualities that you should ensure the person you are appointing has, such as trustworthiness, organization, possibly negotiation skills, and at least a basic understanding of finances.  As you age, you should also consider the age of your alternate estate trustee and try to find someone younger than you, if possible.

It is best to appoint Estate Trustees who reside in Ontario, or within Canada.  Appointing a Trustee who resides in the United States, for instance, can carry with it a host of issues, such as cross border taxation concerns, the requirement to post a bond, and practical/logistical issues related to dealing with assets in Ontario.

The people you appoint need not be experts in all fields; a proper Will usually provides your Trustees with the power to hire the professionals he or she may require, such as accountants, lawyers, financial planners, etc., and to pay them their ordinary fees.

Your Estate Trustees are fiduciaries, and need to make decisions that they will be responsible for, however, they should be able to work with the assistance of professionals in their respective fields.

Depending upon your situation, a professional trust company can also be a good option.   Trust companies will usually wish to review the draft Will, and it is normal for them to ask you to include specific clauses   to ensure they are able to act.  Your estate planning lawyer will be able to work with you to ensure that your Will reflects your wishes and contains the powers required by the trust company.

bethany

Bethany is an associate lawyer in the Wills and Estates department at Berry Gage LLP. 

You can contact Bethany with your estate planning questions at: banderson@bgfamilylaw.ca

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Early Neutral Process Planning

Separating can be overwhelming, especially in the initial phase.  It’s hard for separating spouses to know where to start (Lawyers?  Therapists?  Financial professionals?  Mediators?  All of the above?).

Choosing where to start – and how to start – is one of the most important decisions separating spouses must make.  It is the process that will guide the family through the difficult discussions and choices that follow.  Choosing the process that will work best for the family is paramount.

Early Neutral Process Planning (or “Early Neutral Consultation”) is a service that we provide for separating spouses (and/or their supportive friends and adult family members).  We help prepare a roadmap for the family so that they, together, can choose the most efficient, economical and respectful process.

In an Early Neutral Process Planning session we do not provide legal advice to participants (that would be a conflict of interest because both parties are present).  We do:

  • Walk clients through the separation process step by step;
  • Provide general information about the law;
  • Provide information about the different process options and professionals (including lawyers, financial professionals and family professionals) available – their roles, how to make the best use of their services, etc.;
  • Set out the disclosure that parties will need to make, regardless of their chosen process, and options for compiling that disclosure; and
  • If needed, provide referrals (we are not compensated for this by the professionals to whom we may refer clients).

If you or somebody you know might be interested in this service please do not hesitate to contact our Business Manager, Fiona Bryan, at 905-338-7941 ext. 230 or fbryan@bgfamilylaw.ca

http://www.bgfamilylaw.ca

Marian Gage is a Partner (a Collaborative Family Lawyer, a Certified Specialist in Family Law and an Accredited Family Mediator) at Berry Gage LLP.

“Do I Need a Will?” (and other questions for our Wills and Estates Lawyer)

People call us every day with questions about wills.  We thought it would be helpful to interview our Wills and Estates lawyer, Bethany Anderson, so that she can provide the answers to some of these questions.  Here are Bethany’s answers:

Do I need a Will?

“The most general (and obvious) two reasons to have a Will are that it allows you to a) decide who will be responsible for administering your estate (your “Estate Trustee”) and b) determine who will receive the assets of your estate and in what proportions/quantities.

A Will also allows you to create trusts for minor children, directing the age at which they will receive assets outright, and allowing for discretionary payments and/or milestone payments of income and capital along the way.

If you are providing for disabled beneficiaries, you can create a trust that will allow your beneficiary to maintain eligibility for government support payments and other ancillary benefits.

Basically, a properly drafted (and thought out) Will allows you to be flexible, and ensure your wishes are carried out.”

What happens if I die without a Will?

“In Ontario, if you do not have a Will, the Succession Law Reform Act (“SLRA”) governs what happens to your estate.  The intestacy provisions of the SLRA do not reflect everyone’s wishes, and many people are surprised when they learn how those SLRA provisions work.  For instance, a common assumption is that if a person is married (and has children) “everything will go to my spouse anyway.”  This may or may not be true, depending upon your circumstances, value of your assets the way your assets are held during your lifetime.    Under the SLRA, your surviving spouse (provided you are married) would receive the “preferential share” of your estate ($200,000.00), after which, he or she would share the remainder of your estate with your children.

If your children are minors (under 18 in Ontario), without a Will, there are no trust provisions established.  Minors are not entitled to receive assets outright, so often the Office of the Children’s Lawyer becomes involved.   Further, if you and your spouse are in a common law relationship and you have children together, your spouse does not automatically have the same property rights under the SLRA as they would if you were married, and unless a dependent’s support claim is possible, your children may be entitled to all of your estate.

The SLRA provides for distribution amongst next of kin – if you wish to make gifts to friends or charities, this won’t happen unless you have a Will creating these gifts.

Without a Will, you do not have a choice in who will act as your executor/estate trustee.  Someone will need to make an application to the Court for a Certificate of Appointment of Estate Trustee Without a Will.”

 My situation is very simple…Can’t I just get one of those less expensive Will Kits online?  Do I really need a fancy estate planning lawyer?

(We note Bethany has a lot to say about this!)

“Estate planning is a process, not just a document or a set of documents.  In many ways, you really do get what you pay for.  Everyone thinks of themselves as “simple” or “straightforward”, but if you are not aware of issues that might impact your estate, then you can’t consider them.

A lawyer who is well versed in estate planning will discuss your personal and financial circumstances with you.  They will talk to you about your goals, possible outcomes, contingencies, and how your plan may be impacted by the way you hold your assets.  They will be able to raise issues for you with respect to taxation (and may wish to work alongside your accountant in some cases), family law issues, etc.  They should be able to offer you options and advise you of risks that you may decide to accept or attempt to avoid.

The Will you prepare with an estate planning lawyer might appear “simple” or more complex, but it is very important to consider these issues as part of the process.  There is a lot more thought required for a proper Will (or estate plan) than just inserting names on a sheet of paper.

A Will kit is an inexpensive tool that allows you to prepare your own Will.  The price tag can be attractive, as can the simple availability online or in stationary stores. I am often asked “if I do a Will myself, will it be valid?”  That is not an easy question to answer.

With a Will kit, a person might end up with a Will that is technically valid (if it has been drafted and signed correctly) and that works for them. However, if it is not executed properly, it will not have met the technical requirements of a Will.   If it is “valid”, an even more important question is “does it do what you want it to do?”. If you have done it yourself, you have not received advice from a lawyer, and will probably not have considered various contingencies.

The language used in Will kits can be successful/correct or not – it really depends.  Many Will kits are missing clauses relating to things other than the distribution of assets.  When incorrect language is used, the person using the Will kit may not notice or understand the impact.  In some instances, the effect of using the wrong word (one common example, the use of  “children” instead of “issue” in an important context) the effect may be that the Will is interpreted in the exact opposite manner than the testator intended.

These are just some of the risks.  Wills from Will kits are also often lacking in provisions dealing with the powers of the estate trustees, compensation, and other “standard” Trustee provisions used by lawyers that are carefully crafted and included to prevent litigation and to ensure that Trustees have the toolkit they may need under the circumstances.  It can be a trade off: an initially low cost (the price of the kit) vs the risk of possible headaches and litigation costs (or wishes not being fulfilled) after your death.”

bethany

Bethany Anderson practices Wills and Estates law at Berry Gage LLP.  You can read more about her and contact her with your own questions by clicking this link: http://www.bgfamilylaw.ca/bio-ba.html

 

It’s Not Win or Lose. It’s How you Play the Game

Around August every year we pull out the fall calendars and the cheque books and the sports bags and dance bags hoping some of that equipment will still fit.  Time to register the kids for their fall activities.

According to my newsfeed, research shows that it’s important for kids to participate in more than one sport rather than specializing exclusively in just the one.  Good to know.  In addition to rep hockey, parents who really want to do right by their kids will find time in that schedule for some soccer or swimming or basketball.

Managing the kids’ activity schedules and the associated costs is enough of a challenge in an intact family.    When parents separate, the kids’ extracurricular activities can become a divisive issue.  Here are a few things to consider when creating a parenting plan to avoid possible conflict over activities when registration time comes around every year:

  1. Set a budget. Put it in writing.  Stick to it.

This is obviously helpful even where parents are not separated.  When coaches and instructors tell us our children have “what it takes” it’s hard not to give in to pressure to pay for the next level of training, etc.

Consider all of the costs – not just the initial registration fees but tournaments (and associated costs such as travel, meals and hotels), equipment, costumes, private coaching, dance exams, makeup, photographs, videos – and how you will fund these throughout the year.

Look at the funds that are available.  Remember that the income the family had before separation must now be used to fund two households.  Have a realistic discussion about what the family can afford.  Put that in writing in a parenting plan.

  1. Set out your mutual goals.

Separated parents won’t agree on everything.  When it comes to the kids you probably have some common goals surrounding their best interests including health and well-being and academic standards.  If you put these in your parenting plan all future discussions about whether to increase or reduce the extra-curricular activities can refer back to these goals to help with the decision-making process.

  1. Set limits.

Whether it’s the number of hours in a week, or days, or tournaments or the number of activities in which a child will participate set this out in a parenting plan to avoid future disagreements.  The more detailed this is in a parenting plan the less parents will have to argue about when issues arise in the future.

  1. Set out responsibilities.

Who will do the driving?  Who will be responsible to care for siblings when one child is participating in an activity?  Are parents required to volunteer?  Will all parents have the opportunity to attend practices, games, recitals, etc. regardless of the schedule?  How will extended family participate?

  1. Include a detailed “Dispute Resolution” provision.

Think about…

  • What will you do if there is a disagreement in the future?  How will you come to a child-focused resolution?
  • Other than parents, whose input will you want before deciding (this may be the children, counsellors who work with them, teachers, medical professionals, coaches, etc.)?
  • Will you work with a mediator (and, if so, how will you choose the mediator and how will you share the cost?)
  • If you really can’t agree will you outsource the decision-making to a third party such as a parenting coordinator or an arbitrator?
  • How much time will parents need to consider these decisions before a response is required?

All of this should be set out in a parenting plan to provide a clear path to follow if parents disagree going forward.

Most importantly – don’t forget to have fun!

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Marian Gage is a Collaborative Family Lawyer, an Accredited Family Mediator (OAFM), a Certified Specialist in Family Law (LSO) and a partner at Berry Gage LLP…
…and a dance mom / soccer mom!

Does it matter if “I do?” What if “I don’t?”

By Marian Gage

The Angus Reid Institute recently published a poll indicating more than half of the respondents feel marriage is not important to them.  Younger Canadians are waiting longer to get married, or they are not getting married at all.

The same poll indicates that most Canadians feel that married spouses and spouses who are cohabiting but not married should be treated equally in law.

The reality is that the law distinguishes between married and non-married spouses who are living together in several ways.  On some issues there is no distinction at all.  Here’s the brief breakdown…

Parenting and Child Support

It makes no difference whether a child’s parents are married, unmarried and cohabiting, or practical strangers who never shared a home.  The law around parenting is child- focused and based on a child’s best interests.

Similarly, child support is considered the child’s right and has nothing to do with the parents’ marital status or living arrangements.

Spousal Support

Married people are considered “spouses” who may be entitled to receive – or have an obligation to pay –  spousal support once they are married.

Cohabiting spouses who are not married are considered “spouses” who may be liable to pay or entitled to receive spousal support after they have been living together for three years, or for a shorter period of time “in a relationship of some permanence” if they have children together.

In short, in longer relationships there is no difference between married and unmarried (but cohabiting) spouses when it comes to spousal support.

Property

The law in Ontario provides a regime for sharing the value of property that has accumulated from the date of marriage to the date of separation.  If one spouse has accumulated greater wealth in his or her name during the marriage, then that spouse is required to share that gain with the other spouse.

This regime only applies to spouses who are legally married.  While there are some other rights and remedies available to unmarried spouses they do not share the same entitlement in the legislation.

Matrimonial Home

A matrimonial home, by definition, is a home (and/or cottage/houseboat/vacation property, etc.) that married spouses are occupying in the ordinary course at the time the marriage ends.  The matrimonial home is treated differently than other property and married spouses benefit from certain rights with respect to a matrimonial home even if that home is in only one spouse’s name (and even if that spouse owned the home prior to the marriage, even if that spouse inherited the home, etc.).

No matter how long two people are cohabiting, no matter how many children they have together, no matter how much a spouse contributed to the equity/value of a home, the rules about matrimonial homes do not apply to unmarried spouses.

As self-serving as this will be given that a lawyer wrote it, I would strongly urge spouses who are thinking about cohabiting (even if there are no plans to marry) to get advice about what this means legally to avoid unpleasant surprises in the future.

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Marian Gage is a Collaborative Family Lawyer, an Accredited Family Mediator (OAFM), a Certified Specialist in Family Law (LSO) and a partner at Berry Gage LLP

Slow and Steady Saves Time and Money

We meet a lot of new clients in January/February.

There’s something about this time of year that drives people to make that call and meet with a family lawyer.  For some, this step is part of a process they have been preparing for over time.  For others the separation is unforeseen.  Unexpected and unprocessed.

It’s important for lawyers, mediators and separating spouses to understand that where one party to a separation is taken by surprise (either by the events leading to the separation or the separation itself) that spouse needs time to accept the separation and make decisions about moving forward.  A process where a spouse feels rushed will not result in a quick, efficient agreement.  Quite the opposite, in fact.

We as lawyers and mediators are often the first stop and that makes it our responsibility to work with clients to help them determine whether they would benefit from other professionals – a counselor, a therapist, a minister, a support group – before taking certain steps in the legal process.

Spouses who want to move through negotiations quickly will benefit from allowing time for a spouse who still feels blindsided by the separation to work through things at their own pace.  A successful negotiation requires all parties to be in a place where they can make important decisions about their future.  The results: less time and money spent on the professionals and a reliable agreement.

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Marian Gage is a Collaborative Family Lawyer, an Accredited Family Mediator (OAFM), a Certified Specialist in Family Law (LSUC) and a partner at Berry Gage LLP

 

Watch Out For These Roadblocks to Negotiating Effectively…

Kathryn Jankowski headshot

By Kathryn Jankowski

B.A., CFP, CFDS, FMA, AccFM

Certified Financial Divorce Specialist and Accredited Family Mediator

Divorcing people are, typically, under a lot of stress and sometimes they forget how to argue effectively during their negotiations.  Stressful situations often bring out the worst in people.  Remember, however, that when you are trying to work out a reasonable deal with your soon-to-be-Ex that (s)he is less likely to give you any consideration if you argue in a way that makes them defensive.  Right? So here’s a list of what not to do to ensure you don’t argue ineffectively.

Blaming And/or Bringing Up The Past

Blaming someone for bad behaviour is only going to make them defensive, especially when you do it in front of someone you have known for a relatively short period of time (your collaborative lawyer).  This is not how to get on your Ex’s good side.

Yelling

Often when we yell no one really hears us.  Have you ever noticed that the louder you get the less someone is listening to what it is you are saying?  When you yell the only thing the other person hears is that you are angry.  Sometimes it’s not so much what you say but how you say it.  Consider this when negotiating.

Picking Out Small Issues

When you are negotiating and making decisions that affect your life you might want to stay on track.  Dealing with the important, substantive issues is key.  If you want to pick out the small issues it’s probably not a good idea to alienate your spouse to a point where he or she doesn’t want to consider the rationality about the big stuff if you keep picking out the small stuff.

Interrupting

If you are listening just to get a chance to respond you won’t get anywhere in the conversation.  I call this the ‘circular conversation’ as each person restates their position because they know they weren’t heard.  If you truly listen to the other person you might gain some insight as to why they feel a certain way about something.  That insight might gain you an opportunity to have that need met in another way.  A way that might work for you both.

Assuming

If you aren’t quite sure what someone meant, ask them.  Sometimes I ask my clients to restate what they have heard from the other person just to make sure they were listening.  It also gives the listener an opportunity to restate and reset the understanding if the listener didn’t get it quite right.  Clarifying the point can also give you the opportunity to find out what is important to your spouse and why.  Maybe their need can be met in a way they haven’t considered.

What you could do to be an effective communicator:

Take Your Time

Don’t just say the first thing that you think.  Instead, consider how your spouse might understand what you are about to say.  Put yourself in their shoes.  Sometimes, it’s not what you say but how you say it.  I think I’ve said that before…..

Treat Your Spouse How You Want To Be Treated

OK, I know this isn’t always easy but if you are constantly kind and non-threatening but still getting your message out it can defuse your spouse to reasonableness.  It’s hard to engage your anger when someone is being nice and considerate towards you, even if they aren’t agreeing.  Ever heard the saying, “It’s easier to kill a bee with honey than with vinegar?”

In the end, what you end up with after the negotiations are said and done can affect your life in a big way.  You might consider how you want to argue, effectively or ineffectively.

Kathryn can be reached at:
Financial Divorce Services & Family Mediation
151 Randall Street, Suite 100
Oakville, Ontario
L6J 1P5

Business Phone: 416-729-7981

Website: www.financialdivorceservices.com
Twitter: @KJankowski
Facebook: Financial Divorce Services