Many people assume that if they pass away without a will, their spouse or children will automatically inherit everything. However, this is not always the case. In Ontario, dying without a valid will means that provincial law determines how your estate is managed. Without a valid will, your loved ones may face delays, additional costs, and outcomes that may not reflect your wishes.
What is a Will?
A will is a legal document that sets out your wishes for how your estate will be distributed upon your passing. This document allows you to name guardians for your minor children, set up trusts for how and when assets should be distributed, and appoint an estate trustee to manage the distribution of your property and assets.
What Is Intestacy?
Intestacy occurs when someone passes away without having a valid will in place. In these situations, Ontario law determines how the estate is distributed. In Ontario, the Succession Law Reform Act R.S.O. 1990, c. S26 is the law that regulates intestacy.
Who Takes Care of Your Estate?
In the event that you pass away intestate, an eligible relative may need to apply to the court to be appointed as your estate trustee.
They are responsible for gathering estate assets and ensuring that liabilities of the estate, including debts, funeral expenses, estate administration costs and taxes, are paid. Once liabilities of the estate are accounted for, the estate trustee can then begin distributing the remaining assets to your relatives
How Will Your Estate Be Distributed?
The distribution of an estate left intestate depends on which family members survived the deceased.
Generally, Ontario law distributes the estate as follows:
If you have:
A spouse only: When a person dies intestate and is not survived by descendants, their spouse is entirely entitled to the property
A spouse and children: In this case, the spouse is always entitled to the “preferential share” of the estate, which is determined by the Lieutenant Governor in Council. In Ontario, this amount is currently $350,000 of the total value of the estate. The spouse may also receive a portion of the remaining estate, with the balance distributed among the children
Children only: When a person dies intestate and is survived by descendants, the property will be distributed equally among them.
Parents or Siblings or Nieces and nephews: If there is no spouse or descendants, the estate will be distributed to parents, siblings, or nieces and nephews
The Ontario Government (The Crown): Where a person dies intestate and there is no surviving spouse, descendant, parent, brother, sister, nephew, niece or next of kin, the property becomes the property of the Crown
Why is a Will Important?
There are many benefits associated with the creation of a will. Some of which include:
- Fraud protection: Without a valid will in place, individuals may improperly make claims to your estate, leaving your family in expensive legal disputes in an effort to reclaim your estate
- Prevents delays: The process of deciding on an estate trustee takes time, leaving your family without access to resources they may need
- Ensuring your wishes are followed: Provincial law follows a specific order of estate distribution. Meaning that even if you wanted your inheritance to only go to your siblings, the court will always distribute assets to your spouse, children, etc. first
- Protecting minor children: With a valid will in place, you are able to appoint a guardian and/or set up trusts for your child(ren)
- Reducing family conflict: A clear will may help minimize family disputes and uncertainty
Is It Worth It to Write a Will?
While it may be uncomfortable to discuss wills and estate planning, having a valid will in place can help provide clarity and peace of mind for both you and your family upon your passing. As every family and estate is different, speaking with a wills and estates lawyer can help ensure that your wishes are protected.