As mentioned in previous episodes of Hull & Hull TV, even well thought out and well-drafted wills can end up being challenged in court. Avoiding litigation and keeping everyone on speaking terms should be every family's goal -- but it is easier said than done.
We live in an era where families have become more complex. The modern family often incorporates second and third marriages, step-children, half-children and common law spouses. Issues and tensions tend to underlie these types of relationships and they can become exacerbated when estate planning concerns arise. Although easier said than done, good communication and family meeting-style discussions can go a long way to facilitate estate plans being upheld.
We often recommend to our clients that they create a 'global' estate plan, incorporating other agreements such as cohabitation agreements, marriage contracts and separation agreements. Having these documents well-synced to wills and powers of attorneys can go a long way in sorting things out when plans go awry.
Another frequent recommendation we make to clients is to ensure their estate plans are up-to-date. Family dynamics and finances often change and a good estate plan should adapt to those developments.
There are also some 'hot-button' issues that are almost always avoided in estate planning, such as extra-marital relationships and children born outside of marriage. A comprehensive estate plan will incorporate those types of relationships either directly or indirectly to avoid claims against estates.
Poorly drafted wills are another common cause of estate litigation. Having seen so many of these, it has become clear to us that you "get what you pay for." Drafting your own will based on information found on the Internet or in a do-it-yourself kit cannot replace the skill and experience of a well-seasoned estate planning lawyer.
Complicated finances are another reason estate plans can fall apart. We live in a world where assets are increasingly mixed between different investment vehicles, such as RRSPs, investment accounts, holding companies and inter vivos trusts. These complex set-ups tend to bring out the flaws in estate plans. We often tell clients to not shy away from contacting their investment advisors and money managers in order to make sure that all the "Ts are crossed and Is dotted." For example, make sure that RRSP designations are done and that advisors have all of the necessary documentation and information that they need in the event of your death.
Another important consideration that can influence the likelihood of estate litigation is the appointment of an executor you trust and in whom you have confidence. This role is obviously crucial in the administration of an estate as executors are afforded significant rights and responsibilities under the law. It is important to carefully consider whether or not it is a good idea to appoint multiple executors, as riffs can occur between them and between those who feel slighted by not being chosen. People often automatically appoint a family member as executor when this doesn't have to be the case. It is sometimes wise to have a family friend or professional act as executor when family dynamics call for it. These people are often well-suited for the job as they can look at the family from the outside without any pre-conceived notions about what should or shouldn't be done. The most important thing to consider when appointing an executor is that it should be someone you trust implicitly because you won't be around to keep tabs on them.
Taking steps to shield your family from the undesirable process of estate litigation is one of the greatest gifts you can leave behind. Even though they might not appreciate it after you are gone, you will have peace of mind knowing that you have done everything in your power to protect them.
*Ian Hull and Suzana Popovic-Montag are partners at Hull & Hull LLP, an innovative law firm that practices exclusively in estate, trust and capacity litigation. To watch more Hull & Hull TV episodes, please visit our Hull & Hull TV page.