Drafting one will is hard enough for most people. But for some testators, a secondary will may actually be worth the extra effort.
For several decades, Ontario testators have been able to divide their property between two wills: one for assets that require probate, and one for assets that don’t.
This means that when the testator dies, it’s only the assets in the primary will that need to be submitted for probate, leaving those in the secondary will to be transferred without attracting the 1.5 per-cent Estate Administration Tax otherwise payable on an estate.
The estate planning technique – sometimes known as “dual wills” or “multiple wills” – is particularly attractive to business owners, because shares in private companies and business loans are two of most prominent and potentially valuable examples of assets that are exempt from probate.
If the extra cash isn’t enough to convince you, then think of all the time you will save by avoiding the probate process for at least some the property left behind by a testator. The court’s estates office is horribly overburdened, and it routinely takes months before a certificate of appointment is issued confirming trustees in their position, allowing them to get on with the business of distributing assets.
However, when it comes to actually drawing up dual wills, things can get a bit technical because of the need for the two documents to match up with one another.
Things can get even more complicated when two spouses each leave their own set of dual wills, as one recent case demonstrates. Sadly, the beneficiaries of a deceased couple lost out on some of the benefits of the technique thanks to a combination of family tension, unfortunate timing and some sloppy drafting.
According to the ruling, the elderly couple at the heart of the case each left behind a primary and secondary will after dying in quick succession in 2016 – the husband dying first and the wife 42 days later.
One of their daughters had already received an $800,000 bequest from the mother’s estate when she claimed in court that she was entitled to $800,000 more, based on the text of her father’s dual wills.
After recognizing drafting errors in the husband’s secondary will, the judge in the case found that he had only intended to leave the legacy to the daughter if his wife failed to outlive him by more than 30 days. Since she had survived him for longer than that (just barely), the bequest to the daughter must fail, the judge concluded.
In addition to drafting issues, there has also been some controversy in the courts about the validity of certain clauses often included in primary and secondary wills. That’s why it’s best to consult an experienced lawyer who can guide you through the process and help ensure your wishes are carried out.
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