This is the Manley Law Estate Planning Guide. It's a good start when you're thinking about estate planning. The following is a list of what to think about before you come in to see us about your estate planning.

Who will be your executor?

The Executor is the person who will administer the terms of your will after your death. We recommend appointing an executor and an alternate executor (i.e. a person who would act in the event the executor is not able or unwilling to act). Both the executor and the alternate should be capable people who are likely to be around at the time of your death, but, and this is the most important requirement, the people you choose must be people you trust.

Who are the beneficiaries?

Beneficiaries are, no surprise, the people who benefit from your will.

Where a testator (the person signing the will) is married they may choose to give all they posses to their spouse in the event of their death, but this is not necessarily the case. A testator may choose to benefit their children, rather than their spouse, or to benefit one child more than another child. The testator has the power of decision, but this power is somewhat limited by a spouse’s interest in any property of the marriage. It is most common for couples with children to give all they possess to their spouse, but if the spouse dies before the testator the testator gives their possessions to either their children or the children’s trust (if the children are young).

Think about who you want to receive a benefit from your will and what you want that benefit to be.

Who will be the guardians of your children?

Who would you like to name as the guardian of your child or children? This can be a complicated question when it comes to blended families, but it’s prudent to identify one or more people you wish to be responsible for the future care of your children in the unlikely event both you and the other parent have died.

Also think about who you would like to handle the funds left to children. This can be your executor, the children’s guardian, or a third person as the children’s trustee. The children’s trustee (or trustees); this is the person who will manage the financial needs of the children and any money from your estate to be used for the care and maintenance of the children.

What about your assets?

What you have is almost as important as who you want to give it to. If you have any of following we can have a discussion on how to handle the item in question:

Real Property
Stocks / Investments
Business Interests
Pensions
Life Insurance
Expected Inheritance
Annuities
Valuable physical property (art, jewelry, collectables, etc)
Items of sentimental value (clothing, jewelry, books, photo albums, etc)

How you hold your assets is also important.

Have you named beneficiaries on your RRSP?
Do you hold property jointly with a spouse?

The answers to these questions can change and estate planning strategy.

Estate Planning isn’t just about wills.

A Power of Attorney and a Personal Medical Directive may be necessary to ensure your affairs are handled before death.

Power of Attorney

In the Power of Attorney you appoint an attorney and an alternate who can act as you would to manage your affairs - mostly of a financial nature. We often prepare an enduring power of attorney (one that will allow their spouse to act for them if they become incapacitated).

Think of who you would like to appoint as your attorney (this person is not necessarily your spouse) and also think of who you would like to be your alternate (the alternate will only act if your attorney cannot act or is unwilling to act). Your attorney should be someone who is responsible, trustworthy, and likely to be able and willing to act.

Personal Medical Directive

The Personal Medical Directive is a document in which you outline your values and wishes relating to the management of your care in the event you are not able to make these decisions yourself. The person you appoint, known as the delegate, can make decisions regarding your living arrangements, nutrition, treatment (as well as stopping treatment); however, your delegate cannot make active decisions regarding physician assisted death.

Think of who you would like to appoint as your delegate and also who would be a good alternate. Your delegate should be someone who is responsible, trustworthy, and likely to be able and willing to act. The delegate does not necessarily need to be the same person as your attorney.

Estate planning can be simple or complex, depending on what you have and what you'd like to see happen. Ultimately, it comes down to a discussion with your lawyer. This is a good list to get you started thinking about the process.

This post was written by Anna Manley. If you'd like to contact Anna you can send her an email: anna@manleylaw.ca

Who doesn't like pie? If you own the family cottage with your siblings or other family members it's probably more like a pie than you think. Looking at your deed you might see something like this:


What does "Joint Tenants" mean?
What does "Tenants in Common" (the other alternative) mean?

These are two different way people can own property (also known as "hold title"). One means the whole pie - shared. The other means separate pieces of the pie.

Let me unpack that.

Imagine the cottage as a whole pie.
Delicious.

If you own your property with other people as Joint Tenants is means you have an un-divided interest in the property. What does that mean? In the case of Peter, Paul, and Mary it means they each own the whole thing, but they own it together. They each have an un-divided one-third interest. Their pie would be undivided. Peter can't sell his interest in the property as a separate piece and the property can't be sold without Peter's signature.

Joint Tenancy also carries with it the "right of survivorship" - meaning if Peter dies tomorrow, Paul and Mary automatically inherit his interest in the property without the need to use Peter's will (if he even has one). Due to the right of survivorship, in the context of the family cottage, and in other cases as well, Joint Tenancies can be used as and estate planning measure to avoid the cottage being included in a deceased person's estate (i.e. to avoid probate fees).

Tenants in Common on the other hand means each of the owners of a property have their own separate interest. In the case of Peter, Paul, and Mary, if they held the property as Tenants in Common, instead of Joint Tenants, they would each have a separate one third interest in the cottage. Their pie would look like this:

Mary can even sell her interest to anybody she wants. If Mary dies tomorrow her interest in the property is handled by her will (if she had one) and her heirs will receive her share of the cottage. This means, over time, cottages can end up with many owners. Imagine Mary died leaving her cottage interest to her three children as Tenants in Common and they each had three children , leaving their respective interests to their children as tenants in common. Assuming Peter and Paul are still alive after all this, the pie would look something like this:
Complicated.

Which is why most people try to keep things simple by giving the cottage to their children as Joint Tenants. This strategy doesn’t always work. Families have unique dynamics and leaving the family cottage to your children as Joint Tenants is not a one size fits all solution. You need sound advice to determine what's best for you and your family.

This post was written by Anna Manley. If you'd like to contact Anna you can send her an email: anna@manleylaw.ca