Eight ways to avoid a family war over your will

Will and estate lawyers Les Kotzer and Barry Fish have seen it all - boomers fighting over their parents’ estates, predatory marriages, even guardians using their wards as pawns in their own divorces.

Here’s their advice on what creates family wars and eight tips for avoiding them:

1.  Appointing an executor: parents often make the mistake of appointing one child, often the eldest, as the executor but that can ruin the relationship between the siblings. He may be good with money but what if he has a different idea of what you wanted – or what his siblings would like? And, what if he’s really trying to act in the best interests of your estate?

TIP: The courts won’t overturn an executor who is ‘acting reasonably’, says Kotzer so you’re better off picking someone else.

2.  Appointment of a guardian: “‘Beware’ if you appoint your brother and sister-in-law as guardian”, says Kotzer. If they divorce later on, your in-law could use your children as pawns in their divorce dispute.

TIP: Only appoint the blood relative, not the in-law.

3.  Leaving the house to your caregiver: When a caregiver child lives with their parent, should the parent leave the house to them? Often the other kids want the house sold and want to kick out the caregiving child who may not be able to afford another home.

TIP: Tell all your kids your decision while you’re still alive, leave a letter stating the reasons why you made the decision and get a doctor’s report to verify that you are competent to make the choice. And make sure that none of your kids are with you and your lawyer when you sign your will. If you don’t, the other kids could contest your will.

4.  Giving your children different amounts of your estate: You may leave 5% of the estate to one child and 95% to another such as the caregiver child. That means that the child with 5% is now a minority shareholder in the estate and could contest decisions about the estate because they may feel slighted.

TIP: Give the 5% child, cash instead. “He is disposed of with one cheque and he’s out of the estate and has no rights whatsoever on anything else,” says Fish.

5.  Joint ownership: If you put your son or daughter on title to your cottage or another asset like a bank account, that’s no guarantee that they’ll actually inherit it. What if their marriage fails or they run into major debt? Someone could come after that half of your asset. What if there are other siblings and your will states that everything is to be divided equally? “Unless the parent specifically provided that this was supposed to be a gift to that child, it’s held in trust for everybody,’ says Fish.

TIP: Complete a ‘declaration of intention’ at the time of the gift or joint partnership, otherwise your will trumps everything and the assets will be divided amongst all of your children.

6.  Loans vs. gifts: If you loan your kids money there could be confusion about whether or not it was a gift. If your child thinks it was a gift, they may not think they need to pay it back. If your child did repay the loan but you didn’t keep accurate records to prove it, the other siblings may think the money is still owing to the estate and come looking for it.

TIP: Document any loans with a promissory note and keep accurate records of any amounts repaid. That way everyone will know if there is an outstanding balance.

7.  Homemade wills and will kits: Homemade wills can have very confusing wording. If you leave all your ‘personal stuff’ to your daughter, what happens if some of that stuff is your husband’s? What qualifies as an ‘antique’? What is ‘memorabilia’? “If the will’s not clear the party who intended something cannot clarify because that person is not around anymore,” says Fish. Will kits try to cover every possible scenario but they can’t, which could lead to court battles later on.

TIP: Spend a couple hundred dollars and do it right the first time.

8.  Marriage revokes a will but separation doesn’t: A second marriage will revoke an earlier will. If there’s no will the second wife gets $200,000 of the estate. If you have two or more kids, she gets one third of what is left and they get two thirds. For one child, the split is 50/50 between them and your second wife.

If you separate from your first wife, fall in love with someone else, don’t do a new will and then die, the new partner gets nothing because the first will is still valid.

TIP: It’s not very romantic, but update your will as soon as your circumstances change. If you divorced your first spouse and intend to marry a new person make a new will ‘in contemplation of’ this new marriage and name the person. This can trump the first will.

Barry Fish likens the world of wills to the movie, “Back to the Future”. “What I’m doing today - the faceoff with the brother and the sister kind of thing – that was created when a woman was in a lawyer’s office in 1973, signing in pen in front of two witnesses and then she got up from the table. She set the table in 1973 for what started here in 2006… It’s Marty McFly.”

RESOURCES:

“The Family Fight: Planning to Avoid It”

“The Family War: Winning the Inheritance Battle”

“Where there’s an Inheritance”

Fish and Associates, Barristers and Solicitors

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