Dying Without a Will: What Happens Next?

By Paula Lester, Senior Trust Advisor

We all know that having a Will is a vital part of a good estate plan. However, sometimes clients need to be convinced of the need for a Will. Here are some specific examples.

If a person dies without a Will, the following may occur:

1. The province decides how the estate is to be divided, and it’s not always how you would think. In Ontario, if you have a spouse and children (even minor children), the spouse is entitled to the first $350,000 of the estate, but the remainder is split between the spouse and children. Also, in Ontario, common law spouses do not have any right to a deceased’s estate under provincial legislation. They may instead have a “dependent’s relief” claim, which requires a more extensive court application.

2. If a minor child inherits under provincial law, there is no opportunity to place their inheritance in trust. Rather, the entire sum is paid into court and then turned over to the child at age 18.

3. Probate may be required, if there is no Will. I remember one poor lady recounting that, when her husband died, all assets were joint except for his car. Because her husband did not have a Will, she had to undergo probate just to have the car ownership transferred into her name.

4. You miss out on the opportunity to appoint your executor. This right then falls to your spouse, followed by the next of kin. In contentious situations, the executor who steps in may not be the best choice.

5. There are likely to be increased fees, probate tax, income taxes, and delays. Part of the importance of a well-drafted Will is that it gives the executor the ability to undertake a number of strategies, such as tax elections and corporate reorganizations, which facilitate the administration of the estate. Executors do not have all of the same freedoms under legislation and therefore an executor administering an estate without a Will may find their hands tied.

Raymond James Trust Services are offered by Raymond James Trust (Canada) in the provinces of British Columbia, Alberta, Saskatchewan, and Ontario, and by Raymond James Trust (Québec) Ltd. in the province of Québec. Trust Services are not covered by the Canadian Investor Protection Fund. This document is not intended to provide legal or tax advice.