Effective March 31, 2014, British Columbians have a new set of laws that govern both the making of Wills and the management of an estate after a person dies. The Wills Estates and Succession Act (the “WESA”) and the new rules of court govern estate administration and estate disputes, and contain some fundamental changes that both clarify and complicate these matters.
Most importantly, under the WESA there are some significant changes for the spouses of those who die without a Will (“intestacy”). The impact is greatest on those in second or subsequent marriages, where there are children of prior relationships and the assets of the couple are not jointly owned. Whereas under the old law, the spouse automatically got a life estate in the family home, that is no longer the case. This is either very good or very negative, depending on whose perspective is being viewed.
The whole question of whether the rules of intestacy work for you is easily remedied, of course. Just ensure there is an up-to-date Will in place.
Why the emphasis on an up-to-date Will? It has nothing to do with the WESA, because existing Wills remain valid, though they will be probated under the new rules. The fact is, though, that many people, even if they have a Will, made it so long ago that it no longer really works. By “works” I mean that a Will is meant to determine who gets the estate, who manages it, and how it is to be managed and distributed. Maybe the Will is so old that key people have died, marriages have broken up or the kids are adults who no longer need guardians. Maybe those kids have turned out to have significant needs or issues. Probably tax planning for the current reality was not on the radar. In any of those cases, it is time to revisit the plan. Having an inadequate Will may be as bad as having no Will!
I routinely meet with people who have finally decided that their 25 year old Wills no longer “work.” They made them when their kids were young, and haven’t looked at them since.
The problem is often just getting to the planning stage; it seems like an overwhelming job so people put it off, sometimes until it is too late. Getting that process started is very important. The planning that goes into making a Will can lead to decisions about lowering taxes, life insurance (to pay those taxes), the use of joint ownership, creating trusts for family members with special needs or who may not be good with money, and other beneficial strategies. The best plan is to get someone with expertise in these matters to get the ball rolling and help you sort it out.
People who ignore the need to plan for the future lose the opportunity to avoid the problems created by dying without a Will or with an inadequately planned Will. Why would anyone miss out on that opportunity? If you have the chance to have your say about what happens after your death, and at the same time ensure your family and heirs are properly provided for, shouldn’t you take it?
The bottom line is, the WESA does not change the need for having a well-planned Will, but it does give us a clear view of what happens if you don’t. And it’s not a pretty sight.