In many parts of Canada, a marriage automatically invalidates any Will that comes before it. But in Ontario, a legal change took effect in January that is signaling a need to revise estate laws across the country. Kim Parlee speaks with Pierre Letourneau, a High Net Worth Planner at TD Wealth, about what this new rule change means and why it may be more important than ever for couples to keep their Wills up to date.
Here to give us his perspective Pierre Letourneau. He's a High Net Worth Planner at TD Wealth. He joins me now. Pierre, it's always great to have you with us. This change in law around wills, maybe you could just clarify a little bit about what the law was before and what is it going to be, or what is it now.
- Sure. Thanks for having me, Kim. So yeah, prior to this change in Ontario, when you got married, a will execute prior to the marriage would be invalidated. So it would no longer be valid. There were exceptions to this rule, but these exceptions really applied in limited circumstances. So if none of those exceptions applied, and if you died before you had a chance to update your will after marriage, then you essentially died without a will. So what we call dying intestate. So that meant that all the careful estate planning that you had put in place prior to that is now just thrown out the window.
So under the changes that were-- they are now in force actually as of January 1 of this year, marriage no longer revokes the wills. So the will that was drafted prior to marriage survives the marriage. Now Ontario is the fourth jurisdiction to do that change. And to repeal this rule, British Columbia, Alberta, and Saskatchewan have already done so. And one note as well to is the Quebec never had such a rule. So it really was a non-issue in Quebec.
- So in terms of the other provinces, they had similar laws to Ontario and they changed them?
- Yeah, and in fact, all other provinces other than Quebec and territories had similar laws. So you can see, I only named a few there. So some of them haven't changed this rule as of yet.
- Is that all of-- like, what you just told us is that the entirety of it? Or, my understanding I think is that it was a bill that came out. It was a pretty sweeping bill that came out, and it had a lot of things that affected divorced and separated couples in estate law. So maybe even more context and what else may have changed.
- Right. This was just a particular amendment so that is part of a larger legislative change in estate law in Ontario. So one of those changes affects married spouses that are now separated. So a divorce or separation doesn't revoke a will, but a divorce does revoke any gifts that are made to a divorced spouse under a will. It also revokes any appointment of a divorced spouse as an executor of a will, and also eliminates any entitlements that a divorced spouse may have as part of an estate when a person dies intestate. So that was always in place in Ontario.
What has changed now is that these rules now extend to separated spouses, so married spouses that are now separated. So prior to the change, if an individual-- if a couple was separated, a previous spouse, a separated spouse, could still be entitled to an individual's estate if that individual died without a will, so died intestate. In Ontario, intestacy rules could lead to a spouse inheriting up to, or at a minimum, the first $350,000 of an estate. So it's a pretty significant rule change for separated individuals.
Also, the legislation also made virtual witnessing of wills and powers of attorney permanent. This measure was a temporary measure that was introduced due to COVID and social distancing rules. So now this is here to stay. Ontario is following suit on what BC has done. So BC made this permanent as of August of 2020, and they're just following suit.
And then finally, Ontario has strict rules with respect to executing a will and making it valid. So in the past, if you didn't follow those strict requirements, a will could be deemed to be-- or may not be deemed to be executed and then invalid. So what's changed with the new legislation is that a judge could determine that a will that is substantially in compliance of the rules is sufficient to be executed. So that's way more lenient than the previous rule which was really strict. So you really had to meet all the requirements for your will to be considered executed invalid.
- What were the reasons for making-- for this bill coming out and all the sweeping changes? Why change the laws?
- I think the main reason behind these changes really was to have legislation that better reflects life in 2022. And also, legislation that improves access to justice for all individuals in the province. So when we look at separated individuals, I think we have a lot of couples that separate, but don't necessarily follow through with the divorce they may have and the intention of divorcing in the future, but they don't get around to it.
Well, obviously, with the previous rules, those individuals weren't necessarily protected, especially if they didn't get around to updating their wills as well too, so they could have a former spouse inheriting a large portion of the estate-- of their estate, which may not be their goal. So this rule change is really provides protection to those individuals.
Also when we look at the rule with respect to virtual witnessing of wills and powers of attorney, you can see that this will obviously help individuals that live in remote locations in the province, or maybe the individuals that have mobility issues, it will help them access legal services more easily. And then when we think about the rule that was in place that revoked a will when marriage occurred, that rule was initially in place to protect a new spouse, especially when an individual remarries.
That new spouse probably wasn't included in a previous will that was drafted by the individual. So the new rule was-- the rule was helpful in protecting that new spouse because it would revoke any previous spouse. And then if no will was put in place, at least that new spouse would be entitled to part of the estate through intestacy rules.
The issue that has occurred, unfortunately, is that there's been a rise of predatory marriages in jurisdictions that have this rule still in place. So individual's financial predators are taking advantage of this rule specifically to marry individuals that maybe are a little bit more vulnerable or elderly and use this rule to gain access to part of that individual's estate when they eventually pass away. This rule was really-- the change was really meant to protect vulnerable and elderly individuals that may be targets of those financial predators.
- Pierre, I've only got about 30 seconds left, so which is maybe any other final things we should keep in mind.
- Yeah, I think the key takeaway here is that for everyone to review their wills, especially if these new rules will impact them, so anybody that is getting married this year or in the future, they may want to take a look at updating their wills. If you're a separated spouse and you want your former spouse to still inherit your estate, make sure that you get a new will in place to reflect that because the new rules will change that consequence.
And I always recommend anybody, even if these rules don't impact you, I think it's important to review your will every three to five years. Your circumstances changes over the years, you want to make sure that your wills really reflect your wishes.
- That's right. A little time now saves a whole lot of pain later on. Pierre, always a pleasure. Thanks so much.
- Thank you.