Toronto Estate Law Blog : Toronto Estate Lawyer : Hull & Hull Law Firm : Trust Mediation and Succession Planning : Serving Ontario, Ottawa, Mississauga, Hamilton

• Email This
• Print
• Comments
• Trackbacks
• Share Link

On April 7, 2009, I blogged on the decision of Justice Strathy in Richardson (Estate Trustee of) v. Mew.  In that decision, His Honour considered the situation where a deceased’s first spouse was unexpectedly the named beneficiary of a life insurance policy owned by the deceased, the second spouse seeking to remedy what she argued to be an unjust situation. As I noted, His Honour, while not exercising his jurisdiction to rectify the policy, left open the possibility that, in the right set of circumstances (i.e. clear evidence of a mistake), the court could properly employ such a remedy.

The Ontario Court of Appeal released a unanimous decision on May 14, 2009 upholding Justice Strathy's decision.  Of particular significance to the trusts and estates bar, the Court of Appeal clearly stated that, after the mental incapacity of the donor, the attorney under a power of attorney was not permitted to change a beneficiary designation even in circumstances where there was compelling evidence that the donor would have done so if capable:  "As a fiduciary in a role rising to that of trustee, [the second wife] was bound to use the power only for Mr. Richardson's benefit."

In commenting on the case, The Lawyer's Weekly has noted that counsel for the disappointed second wife is seriously contemplating an application to the Supreme Court of Canada for leave to appeal.  In question: is there ever a situation in which the attorney under a Power of Attorney ought to have power to act in the best interests of the donor to effect a testamentary disposition that accords with his or her last known intentions before becoming incapable?

David M. Smith 

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Declarations of beneficiaries of Life Insurance policies are sometimes thought to be “unassailable.” However, where a deceased’s first spouse is unexpectedly the named beneficiary of a life insurance policy owned by the deceased, the second spouse may have recourse to various legal remedies in an attempt to remedy what is argued to be an unjust situation. Inevitably, a Separation Agreement between the deceased and his or her first spouse is central to any such argument.

The recent decision of the Honourable Justice Strathy in Richardson (Estate Trustee of) v. Mew considered such a situation. The case also stands as an excellent summary of the recent jurisprudence that has developed in this area.

In short, the disappointed spouse can seek the remedies of either constructive trust or rectification. Justice Strathy points out that “except in exceptional circumstances” the Insurance Act requirements for the change of a beneficiary designation must be strictly interpreted. His Honour clearly had difficulty with understanding “how the designation of a beneficiary under a life insurance policy could be anything other than a juristic reason for an “enrichment.” Although he did not find this to be a case for the exercise of the court’s jurisdiction to rectify the policy, he left open the possibility that, in the right set of circumstances (i.e. clear evidence of a mistake), the court could properly employ such a remedy.

David M. Smith

 

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Annuities are often employed when an individual plans his or her estate. We have covered different aspects of annuities on past blogs on Hull on Estates.

A testator, for example, may choose to have one child’s portion of the future estate placed into an annuity that will create a flow of money over time. The child would have access to the cash flow, but not necessarily access to the principal amount. 

In September 2008, Gayle Reid applied to the Superior Court of Justice for an interpretation.  The claimant’s father, Bernard Wiesberg, died and left an annuity to his friend, Avonne Richter (also identified as his common-law spouse). Minimum annual payments of the annuity were directed in the Will to Ms. Richter who received them from 2003 through to 2007. 

The Applicant was to receive the residue of her father’s estate.  A 2005 Order by Dandie  J.  required Ms. Richter to designate Ms. Reid as the beneficiary.  (A provision of the Income Tax Act required the beneficiary to be named, otherwise the retirement income fund would have collapsed, defeating the testator's intent.)

The issue arose when Ms. Richter, who received the previous annual annuity payments in arrears up to 2006, chose to take the $17,015.57 payment in January, in advance for that year. Ms. Richter died on April 17, 2007.

The Applicant sought an interpretation of her father’s Will, specifically regarding the annual payments. As the payments were for the “lifetime” of Ms. Richter, the Estate owed $12,027.44 to the Applicant because the Court reasoned that calculations must be made to the date of Ms. Richter’s death. Therefore a pro-rata calculation was “the only reasonable and fair manner to ensure the two gifts in the Will are honoured.”

If the annuity had been paid in arrears that December, Ms. Richter’s Estate would have been owed a pro-rata amount of the annuity for that year calculated to the date of her death.

Have a good day.

Jonathan

• Email This
• Print
• Comments
• Trackbacks
• Share Link

 

Listen to:

The Interrelationship Between a Guardian of Property and a Trustee Under a Testamentary Trust

This week on Hull on Estates, Rick Bickhram and David M. Smith discuss the complications that can arise when an incapable person is both the subject of a guardianship order and the beneficiary of a testamentary trust.

Comments? Send us an email at hull.lawyers@gmail.com, call us on the comment line at 206-350-6636, or leave us a comment on the Hull on Estates blog.

 

The Interrelationship Between a Guardian of Property and a Trustee Under a Testamentary Trust - Hull on Estates Podcast #133

Posted on October 21^st, 2008 by Hull & Hull LLP

Rick Bickhram: Hello and welcome to Hull on Estates. You’re listening to Episode 133 on Tuesday, October 21^st, 2008.

Welcome to Hull on Estates, a series of podcasts for the Canadian legal community dealing with issues and insights surrounding estate planning in Canada.  Hosted by the lawyers of Hull & Hull, the podcast will touch on some key considerations when planning estates and wills. Now, here are today’s hosts.

 

Rick Bickhram: Hi and welcome to another episode of Hull on Estates. I’m Rick Bickhram.

David Smith: And I’m David Smith.

Rick Bickhram: If you want to be heard on Hull on Estates you can participate in our discussion by leaving a comment. Give us a call at area code 206-350-6636. The number is in the show notes along with our e-mail address which is hull.lawyers@gmail.com, or you can visit our blog at estatelaw.hullandhull.com. Today David Smith and I are going to be discussing the complications that can arise as a result of guardianship applications.

David Smith: That’s right, Rick. I think what we thought we would discuss is, we’re generally familiar with the concept of guardianship applications. I want you Rick, just to give us a refresher on that before we delve into some of the complications that can arise, because the management of property is not always a simple thing, especially when there are competing interests that arise which require the guardian to seek legal advice or consider whether there is any kind of conflict of interest. Before we get into that, Rick, though, let’s talk about guardianship generally. What are the two types of guardianship and how is a guardian appointed in Ontario?

Rick Bickhram: Well, there are two types of guardianships. The first type of guardianship is the guardianship of property.  And basically a person is appointed to manage with the individual’s or the incapable’s financial affairs.  And the other type of guardianship is the guardianship of personal care. And what that pretty much entails is a substitute decision-maker is appointed to handle the personal care decisions involving the incapable individual. Now looking at what governs substitute decision-makers, there is a statute, which is known as the Substitute Decision Act which is the primary statute governing the appointment of all substitute decision-makers in Ontario.

David Smith: That’s right, Rick, and you know, guardianship is under the supervision of the Court. It’s where the Court steps in and appoints a guardian in those circumstances where someone may not have otherwise provided for a substitute decision-maker by making a Power of Attorney either for property or for personal care. And of course, you can sometimes have situations where one or more attorneys are appointed under a Power of Attorney and can’t agree, and in that situation, where there’s a contest between the individuals who are meant to act jointly but can’t, that’s a situation where you’ll see a contested guardianship application, where the parties basically go in front of the Court and say, judge, over to you, we can’t agree, we need some help here. So that’s the subject of another podcast. 

But today what we want to talk about is complexities that can arise when the alleged incapable person has an interest in property where the discretion to encroach or the discretion to exercise an entitlement may be in question. So, Rick, typically in the guardianship applications that we see in our office, and that you see in this area of practice, when someone is alleged to be incapable and the Court is asked to supervise the substitute decision-making for that person by appointing a guardian, obviously one step a guardian has to make is to prepare a management plan, right?

Rick Bickhram: My understanding of what a management plan is, is that it sets out the guardian’s plan, or his or her proposal to manage this individual’s property going forward.

David Smith: When we’re talking about property, Rick, what are we talking about? Are we talking about just real estate or are we talking about financial assets or can it be all these things?

Rick Bickhram: My understanding is that it involves all of the incapable person’s property, real estate, his bank accounts, any investments that he may have, etc.

David Smith: Right. Now the interesting thing with this area of law is you get all kinds of different scenarios. You will have an incapable person who may have no interest in property or money whatsoever.  You may have someone who simply receives a pension.  You may have someone who’s been brain-injured in an automobile accident and who, therefore, is receiving the benefit of a structured settlement.  Or you may have someone who, through whatever means, has gained a significant amount of their own assets. 

And the complication I want to talk today, Rick, is an interesting situation which I’ve run across, and that’s a situation where let’s suppose that the incapable person has been incapable since childhood. Through one means or another, that person has managed to accumulate some significant personal assets. In addition, that person’s parents, when they passed away, left Wills that provided a testamentary trust for the benefit of the incapable person. So the incapable person then has two sets of assets. One of the assets is let’s say, an investment portfolio, consisting of their own personal investments. The other asset is an interest in a testamentary trust. Now the testamentary trust will be in the discretion of the trustee appointed under the testamentary trust, and that trustee will have a discretion to pay out income to the incapable person. The interesting question, of course is, how does that responsibility dove-tail with the responsibility of the guardian? And the Courts are beginning to have to wrestle with this question. Because once the guardian is in place, the guardian has to manage the affairs. And while the guardian is responsible for administering the property of the incapable person, there’s also a responsibility to receive income from the testamentary trust. The complication, of course, is that the trustee under the testamentary trust is an entirely different person from the guardian.  And so you’ve got two sets of responsibility here. You’ve got a trustee under a testamentary trust making decisions as to what and how much money to pay out to the incapable person.  And on the other hand, you’ve got the guardian for the incapable person who is themselves looking after the property. It’s kind of an interesting question, eh, Rick?

Rick Bickhram: I completely agree with you. What’s your take on whether or not a conflict is present?

David Smith: Well, good question, Rick, because let’s suppose the guardian for the incapable person is also the same person who would be the capital beneficiary on the death of the incapable person. That is to say, let’s assume that the testamentary trust provides for the benefit of the incapable person, gives the trustee the discretion to encroach on the capital for the beneficiary person, but also says that on the death of the incapable person, the beneficiary is by happenstance the same person who seeks to be appointed as the guardian. Sounds like a conflict to me, Rick. What do you think?

Rick Bickhram: Absolutely, and the conflict, I guess, at least in my mind, has to deal with the even hand principle.

David Smith: What’s the even hand principle and how would that apply here, Rick?

Rick Bickhram: Well the even hand principle pretty much is where there’s a trust set up, there are two beneficiaries. There’s a capital beneficiary and then there’s the income beneficiary.  And what the even hand principle stands for, is that the trustee has to act with an even hand for the benefit of both the income beneficiary and the capital beneficiary.

David Smith: That’s right. And of course, you know the difficulty is that the trustee who has to decide whether to exercise discretion, needs to, there are some questions to what criteria the trustee has to consider in deciding whether or not to pay money out of the trust.  And there’s been some talk in some of the cases that talks about a means test which basically is, does the trustee have to look to the means of the alleged incapable to decide whether they’re in need of money from the trust, and if so, how much money?

Rick Bickhram: Well that sounds like an interesting decision, Dave. What case is that?

David Smith: Well you know, Rick, there was a case of Hinton and Canada Permanent Trust Company, and in that case, the wording of the Will in question was strongly in favour of a claim to encroach. Nevertheless, the principle applied. The failure of the author of the trust to allude to the resources of the beneficiary led to an inference that the trust is to maintain and benefit the beneficiary, regardless of and without recourse to his own needs. 

So Hinton seems to stand for the proposition that you don’t necessarily look to means. I think the other interesting issue is there’s a whole body of cases that deal with when the Court has jurisdiction to interfere with discretion exercised by the trustee. And we’re not going to get into that now. One of the cases is Fox and Fox Estate, and there are some other cases that deal with situations when the Court will be critical of the trustee for not acting for the, not appropriately exercising discretion for the benefit of the beneficiary. That’s the issue for a separate podcast. 

But again, I think the really curious issue here is, to what extent does the guardian have any sway over the exercise of the discretion by the trustee, and to put it another way, when the trustee has to consider on what basis to pay out money to the beneficiary. To my mind, that trustee is him or herself exercising a substitute decision-making role in a sense, over the incapable person because the trustee is having to consider what and how much money is required by the incapable person which, of course, is exactly the same responsibility that the guardian has. I suppose another way of looking at it, is that the guardian can simply just passively wait to see how much the trustee is going to give him.  But in any scenario, it’s hard not to imagine that the trustee on a testamentary trust would have to communicate at some level with the guardian.

Rick Bickhram: Absolutely. It’s a give and take relationship it sounds like to me.

David Smith: Right, because both of them are looking after the same person. The guardian is safeguarded to look after the well-being of the incapable, whereas the trustee under the testamentary trust has a fiduciary duty to ensure that the beneficial entitlement of that person, who happens to be incapable, is provided for. And of course, the whole reason that the testamentary trust was set up was because the person was incapable and needed a trustee to look after their affairs. So you’ve got an interesting dove-tailing of responsibility between a trustee and a guardian.

 

Rick Bickhram: Sounds very interesting, Dave.

David Smith: Well, Rick, thanks a lot for this discussion. I really enjoyed it and it was good to sort of explore some of the outer limits of the relationship that can occur between guardians and trustees.

Rick Bickhram: It was a pleasure to podcast with you today, and we look forward to hearing from our listeners.  You can send us an e-mail at hull.lawyers@gmail.com or just pick up the phone and leave us a message on our comment line at again, 206-350-6636. Be sure to visit our blog at estatelaw.hullandhull.com where you’ll find even more information and discussion on today’s practice of estate law. We hope you enjoyed the show. I’m Rick Bickhram.

David Smith: And I’m David Smith.

Rick Bickhram: Until next week, so long.

This has been Hull on Estates with the lawyers of Hull & Hull. The podcast you have been listening to has been provided as an information service. It is a summary of current legal issues in estates and estate planning. It is not legal advice and you are reminded to always talk with a legal professional regarding your specific circumstances.

 

To listen to other podcasts, or to leave a question or comment, please visit our website at www.hullandhull.com.

 

Our theme music is Upper Structure by DJ AKid  and is courtesy of the Podsafe Music Network.

 

/mem

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Listen to Variation of Trusts

Craig Vander Zee and Bianca La Neve discuss variation of trusts, with an emphasis on the Variation of Trusts Act and approval of variations of trusts on behalf of minor, unascertained, unborn or contingent beneficiaries.  The well-known case of R. v. Irving (1975), 11. O.R. (2d) 42 (H.C.) is discussed.

Comments? Send us an email at hull.lawyers@gmail.com, call us on the comment line at 206-350-6636, or leave us a comment on the Hull on Estates blog.

Variation of Trusts - Hull on Estates Podcast #127

Posted on September 9^th, 2008 by Hull & Hull LLP

Bianca La Neve: Hello and welcome to Hull on Estates. You’re listening to Episode #127 on Tuesday, September 9^th, 2008.

Welcome to Hull on Estates, a series of podcasts for the Canadian legal community dealing with issues and insights surrounding estate planning in Canada.  Hosted by the lawyers of Hull & Hull, the podcast will touch on some key considerations when planning estates and wills. Now, here are today’s hosts.

 

 

Craig Vander Zee:  Good morning, Bianca, how are you?

Bianca La Neve: Good, how are you, Craig?

Craig Vander Zee: Very well, thank you. It’s nice to have you back here full-time back in the office after being away with your little guy.

Bianca La Neve: Thank you.

Craig Vander Zee: And it’s a pleasure to be podcasting with you today.

Bianca La Neve: It is, it is a pleasure. How was your long weekend?

Craig Vander Zee: Pretty much filled with championship baseball and soccer. The baseball was Saturday, so six hours on the diamond on Saturday for my little guy, and my little girl played in the rain for three separate games on the Sunday. But they had a blast and it was a good weekend.

Bianca La Neve: Great. So, today Craig, I thought we’d talk about variation of trusts. So in starting our discussion of variation of trusts, I think, Craig, the first step is always to look at your trust document. It’s really important to go back to basics, take a look at what the trust document says, its wording, and from there decide on what your next steps are. And those can be?

Craig Vander Zee: Well, I mean, first of all just piggybacking on that, you need to look at, it could be a testamentary trust arising out of a Will, it could be by way of settlement, it could be by other disposition.  So you need to understand the trust document and the exact wording of the document. It may be that what you really need is an interpretation of a section in the trust, or opinion, advice and direction of the court. But if those have been considered and it’s truly a variation of the trust, then when you’re considering how you want to go about it, you look towards the Variation of Trusts Act.  And when I say how you’re going to go about it, it could be that the variation arises just due to a single issue in the trust; it could be tax reasons or the trust doesn’t provide in a manner that it should, it doesn’t allow for an encroachment and everyone believes in the situation that an encroachment is absolutely appropriate and proper and consented by everyone. But it could also arise from Minutes of Settlement dealing from another procedure, such as a passing of accounts which was contested and as a result, that involves a trust, and as a result the settlement may contemplate a variation of the trust.  Obviously, that would have to be done pursuant to the Act and in consideration of the case law criteria.

Bianca La Neve: So it’s important to know that a variation of trust can be a stand-alone procedure, or proceeding, or it can be ancillary to some broader relief sought, like you had, your passing of accounts or approval of a settlement.

Craig Vander Zee: And that’s right, and even if it is piggybacking if you will, on another settlement or another proceeding, you still would bring the application itself. You still do need to bring the application under the Variation of Trusts Act. And the size of the Act or the length of the Act is quite surprising, it’s only one section in length and we shouldn’t let the length of it fool you, because we simply can’t ignore it.

Bianca La Neve: So essentially the Act permits the Court to approve a variation of a trust, whether it be under a Will, a settlement or other disposition, and allows the Court to approve it on behalf of minor, unascertained, unborn or contingent beneficiaries if the variation in the words of the Act appears to be for the benefit of those persons.

Craig Vander Zee: Well in relying on the Act for the jurisdiction to go ahead with it, there are many things to consider in pursuing the variation such as the procedure to follow and the criteria to be met for the variation to be allowed by the Court.

Bianca La Neve: Now, Craig, there is that well-known case, R. v. Irving which sets out essentially the three criteria that a Court considers in determining whether to approve the variation.

 

Craig Vander Zee: Yeah, and those are in summary, does the variation keep alive the basic intention of the testator or the settler? Does the variation benefit those for whom the Court is asked to consent? And then whether, and this is sort of the legal jargon, but whether a prudent adult motivated by intelligent self-interest and sustained consideration of the expectancies and risks of the variation, would likely accept it. So you first consider, who does the variation need to be done on the behalf of and then you look to those criteria.  And for the purposes of today, Bianca, we won’t be getting into the case law that have considered those criteria, because there’s certainly debate as to the importance of each of those specific criteria and how they would apply to different situations, that is, different factual situations. So we’ll leave that for a different day.  But what I thought we could focus on today, for the remainder of our session is, looking at the representation of the incapacitated beneficiaries and then touching upon briefly, the procedure. 

So essentially then, with minors, the Children’s Lawyer in a trust scenario where the minor as a respondent is going to be the representative and we’ll act as the litigation guardian for the purposes of the variation of the trust. And then we can also look at unborn and unascertained beneficiaries as well.

Bianca La Neve: And Rule 10.01(1) authorizes the Court to appoint a person to represent these interests. This is also known as a representation order. Now although Rule 10 doesn’t specifically refer to the Children’s Lawyer, Courts have traditionally appointed the Children’s Lawyer to represent this class of beneficiaries.

Craig Vander Zee: And again, when dealing with the Notice of Application that’s necessary for a variation, the Notice of Application should specifically request such a representation order in this particular circumstance.  And it may very well be that the order is sought for the Children’s Lawyer to represent all minor, unborn and unascertained beneficiaries to cover the global category of those beneficiaries. 

And then I guess lastly, Bianca, we should touch upon those beneficiaries that are mentally incapable persons or absentees.

Bianca La Neve: In the case of a mentally incapable person or absentee, where there is already a person that has the authority to act as their litigation guardian, attorney or committee, such person usually acts as their litigation guardian in these variation of trust applications, unless the Court orders otherwise. If there is no person that has the legal authority to protect the interests of the mentally incapable person or the absentee, and there is no suitable person willing to act, then the order that should be sought is appointing the Public Guardian and Trustee.

 

Craig Vander Zee: Well and that’s right. And I think, given the amount of time, if we’ve dealt with the representation aspect, obviously those who don’t fall into those categories, beneficiaries who are adults and who are capable, certainly ought to seek independent legal advice as well. But they are capable of obtaining that representation and what we were really touching upon were those who the Court and in law don’t see as being capable and as such, need these types of representation orders or types of representation.  And so I think given the balance of the time, we’ll just touch upon the documents that would be required for a variation.

Bianca La Neve: So the first document you need is the Notice of Application. The Application is brought in the Ontario Court General Division so in your Notice of Application the relief you are seeking is approval of the variation on behalf of the incapacitated beneficiaries.

 

Craig Vander Zee: And when you’re dealing with the beneficiaries, that’s whether they’re vested or contingent beneficiaries.  And while the Notice of Application is certainly the first document in the Application record, perhaps the most important document in the Application record is the deed of arrangement itself. And the deed of arrangement will set out what the terms of the variation are intended to be.  And that is well, that is being requested to be approved by the Court and is to be executed by all of those beneficiaries that have capacity. So it may also be the case that the trustees sign the deed of arrangement as well. And aside from the deed of arrangement, there would be an Affidavit that will set out what is often in the recitals of the deed of arrangement in terms of the facts in putting that before the Court so the Court can understand the situation of how it arises, and that it is in the best interests of those who the Court is asking to approve it on behalf of. And then there’s a Factum and it may very well be that a Factum isn’t necessary, that leave can be sought, that the Factum not be necessary.  And that is typical in situations where there is Minutes of Settlement arising from a proceeding and the variation is part of that proceeding, albeit an application unto itself, but that it’s clear to the Court how this variation arises. 

And then obviously there’s a draft judgment that would be circulated amongst the parties so that everybody is on notice as to what the terms of the judgment are going to be. And I think that does it for us today, Bianca.

Bianca La Neve: So thank you for listening to our discussion on variation of trusts. As always, we look forward to hearing from our listeners. You may send us an e-mail at hull.lawyers@gmail.com or leave us a message on our comment line, area code 206-350-6636 and be sure to visit our blog post daily at estatelaw.hullandhull.com.

Craig Vander Zee: Thanks very much, Bianca and I look forward to the next opportunity to podcast with you.

Bianca La Neve: Thanks, Craig.

This has been Hull on Estates with the lawyers of Hull & Hull. The podcast you have been listening to has been provided as an information service. It is a summary of current legal issues in estates and estate planning. It is not legal advice and you are reminded to always talk with a legal professional regarding your specific circumstances.

 

To listen to other podcasts, or to leave a question or comment, please visit our website at www.hullandhull.com.

 

Our theme music is Upper Structure by DJ AKid  and is courtesy of the Podsafe Music Network.

 

/mem

• Email This
• Print
• Comments
• Trackbacks
• Share Link

The common law in Ontario now appears to clearly provide for claims by “disappointed beneficiaries” against drafting solicitors where a bequest to a beneficiary fails as a result of the negligence of the solicitor. (See Harrison v. Fallis, 2006 CanLII 19457 (ON S.C.))

A decision out of the Saskatchewan Court of Queens Bench appears to open the window to this type of claim even wider. Disappointed beneficiaries may also have a cause of action as against financial institutions and others that provide estate planning advice.

In Mayer v. Nordstrom, 2003 SKQB 397 (CanLII), the deceased consulted with a financial adviser with respect to his estate plan. The deceased owned a mutual fund plan, and designated his son as the beneficiary. However, the plan was not registered, and the designation was therefore void.  The fund fell into the deceased’s estate, and the son received only half of the value of the fund as a beneficiary of the estate. The disappointed son sued the financial planner for negligence. 

The financial planner resisted the claim, taking the position that he did not owe a duty of care to the son.

The Court disagreed. The Court held that the “disappointed beneficiary” principles articulated in solicitors’ negligence cases such as Earl v. Wilhelm (2000), 183 D.L.R. (4^th) 45 (Sask. C.A.) and White v. Jones, [1995] 1 All E.R. 691 (H.L.) applied equally to other professions. The “disappointed beneficiary” principle “is not a function merely of the defendant’s occupation”. The planner was a professional who held himself out as possessing special skill, judgment and knowledge in financial planning, which included estate planning tools. The planner ought to have known that carelessness on his part would cause harm to a third party.

The duty of care to potential beneficiaries, opened in the White v. Jones decision, continues to expand.

Thank you for reading.

Paul Trudelle

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Spouses commonly execute virtually identical Wills, called “mutual wills”, on the assumption that each will give the same gifts on death out of the same “family” pool of property.  Oftentimes the residue of the estate of the first spouse to die is left to the surviving spouse, as long as he or she lives at least 30 days after the death.

 

A problem can arise if both Wills provide for the same gifts in case of simultaneous death or death within 30 days.  If both spouses do in fact die within 30 days of each other then an unintended double legacy could result. 

 

The following wording might cause exactly that problem in a mutual will scenario (and perhaps should be avoided or redrafted):

 

1.           I direct my estate trustee to pay or transfer the residue of my estate to my said Husband ( Wife) if he (she) survives me by at least thirty days. 

 

2.           If my said Husband (Wife) dies before me or fails to survive me by at least thirty days, then I direct my estate trustee to pay $100,000.00 to my daughter Sue and pay or transfer the residue to my son Joe.

If both spouses have that wording in their wills, and both die within 30 days of each other, Sue might get two gifts of $100,000 for a total of $200,000 at Joe’s expense, even though only one $100,000 gift was intended.  Joe would not be a happy beneficiary.

Thanks for reading.

Sean Graham

• Email This
• Print
• Comments
• Trackbacks
• Share Link

The contemporary attitude is that we live in a young country.  True in some respects.  Yet we own the oldest contiguous institutions.  Trusts are one aspect of this venerable inheritance: the trust is as old as the Common Law.  Actually, a little older in some respects: the English trust finds its roots in the 12th century.  

It all started when a few knights returned from their crusades to find that the "friends" to whom they had entrusted management of their feudal lands refused to return said lands.  There was no mechanism at law to force the new untrustworthy owners to return the land so the law courts could do nothing. 

Naturally, the irate knights went to the Lord Chancellor and "asked" for justice.  One can imagine the scene: the silk-gowned Lord Chancellor looking down at the length of his shoe, then up at a selection of battle-worn armored thugs with gauntlets tapping hilts on chipped swords, over at the foppish, yawning new land-holder, then down again at the length of his shoe.  Unsurprisingly, the knights who had nothing else to live for continually won in the Courts of the Chancellory and the concept of trustees and beneficiaries was born.  I wager that trial by ordeal would have reached similar results so this must have been fate at work.

Tomorrow some interesting case law, I promise. 

Chris Graham

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Listen to Beneficiary Designations

This week on Hull on Estate and Succession Planning, Ian and Suzana discuss core issues in estate planning; specifically the importance of beneficiary designations.

Beneficiary Designations - Hull on Estate and Succession Planning Podcast #82

Posted on October 16^th, 2007 by Hull & Hull LLP

 

Suzana Popovic-Montag:  Hi, and welcome to Hull on Estate and Succession Planning.  You’re listening to Episode #82 of our podcast on Tuesday, October 16^th, 2007.

 

Welcome to Hull on Estate and Succession Planning, a series of podcasts hosted by

Ian Hull and Suzana Popovic-Montag, that will provide information and insights into estate planning in Canada, from the offices of Hull Estate Mediation in Toronto, Ontario, Canada.  Here are Ian and Suzana.

 

Suzana Popovic-Montag:  Hi there Ian, how are you today?

 

Ian Hull:  I’m great Suzana.  How are you doing?

 

Suzana Popovic-Montag:  I’m fine thank you.

 

Ian Hull:  We have had a busy short last while.  We’ve been obviously busy with our practices but been out speaking and having some fun dealing with some of these interesting estate issues.  I know you hosted our Hull on Estates Breakfast which was, I think it was October 4^th now.  So we’ve come and gone with that.  And you were also heavily involved in a Law Society of Upper Canada program in the past week which was a great success where we spoke with a group of lawyers on capacity issues relating to personal injury claims.

 

Suzana Popovic-Montag:  It’s certainly been a good fall beginning to the fall season with all of the excellent CLE that’s out there, Ian, so it’s been a wonderful opportunity.

 

Ian Hull:  And we’re looking forward to…I know I’m looking forward to next week to a busy continued programs that we’re both going to be involved with.  So why don’t we turn today on Hull on Estate and Succession Planning to the topic that we’ve been sort of working through.  As we have in the past, we’ve sort of broken down what we call the tax planned Will issues and some of these issues Lindsay Histrop brought to the fore, so to speak, at a seminar that she presented on September 17^th, 2007 and we really enjoyed both what she had to say and some of the paper that she…and certainly her paper that she presented.  And it sort of was a trigger for you and I to sit back and re-focus our discussions on Hull on Estate and Succession Planning on some of the core issues relating to estate planning.  We have generally tried to get people to think outside the box and talk about, you know, talk to your family, talk about some real communication aspects of estate planning.  But we’re sort of circling back to make sure that we don’t miss any of the core tax planning issues that are very important to an estate plan.

 

Suzana Popovic-Montag:  And traditionally also, the core of much of the planning that’s been done.  So notwithstanding our hope that, you know, we can bring about conversation and openness and things like that in the estate planning process, the truth is that there are certain things that will always be the core to when people decide to plan and administer their estates.

 

Ian Hull:  And as we’ve talked about, there’s sort of….we’ve broken down this series, we’ll call this our mini-series on tax planning and issues relating to estate planning.  And we’re talking about obviously the core issue of avoiding in Ontario certainly what we call the estate tax itself, talking about deferral and capital gains and those sort of core issues in terms of tax avoidance.  And then finally dealing with later in the series, we’re going to deal with some of the US issues which can be very important.  And can be important with a lot of estates because even in situations where an estate may at first look fairly simple, you throw in a condominium down in Florida into the mix of an estate plan, and you create your own new estate planning issues.

 

But let’s re-circle back here and talk a little bit about what we…why don’t we spend a minute just talking about what we had covered last week and then move into our new area of beneficiary designations.

 

Suzana Popovic-Montag:  Well Ian, last week we were talking about the fact that people can have more than one Will and we called them the primary and the secondary Wills.  The idea being that one Will, the primary Will, would be the one that you would actually probate, whereas the secondary Will would be one that you wouldn’t have to.  And we talked about, you know, the reasons we would want to do that and the kinds of assets that we would put into those particular Wills.

 

Ian Hull:  So moving on from that core estate planning technique, another fundamental estate planning technique is really important, is of course the organizing and dealing with essentially beneficiary designations.  Many of us have different types of investments that can be beneficiary designated.  Some flow outside of the estate, some flow through the estate, but nonetheless, there are instruments such as life insurance policies and the like that can be designated specifically to an individual for a lot of good reasons.

 

Suzana Popovic-Montag: And the key to that designation is if you designate someone other than your estate to be the beneficiary of, for instance, your life insurance proceeds or your RRSPs, then that designated beneficiary would receive the benefit of that policy without it passing through the estate and without it therefore attracting probate fees.

 

Ian Hull:  And the other aspect of designations of beneficiaries and where it can be a very useful tool is, is that it is a fundamental creditor protection technique that works in not all, but in most cases.  For an example, an insurance policy is typically creditor-proof, when it’s in a situation where it flows outside of the estate.  And some situations certainly, recently some of the case law is pointing to RRSPs as being able to be essentially creditor-proof as well.  So there’s another aspect of your, you know, estate administration, and good reason for making sure we have organized our designations of beneficiaries properly.

 

Suzana Popovic-Montag:  Ian, while we’re talking about this topic, one thing that sort of comes to mind is what happens if you’ve designated a beneficiary whose actually a minor at the time of your death?

 

Ian Hull:  Well, that can be I guess problematic if you haven’t thought it through.  There are, and in our web page we have some great articles on this specifically.  Anne Werker has written an article for the Probater on insurance trusts.  There are ways to designate.  For example, an insurance policy, essentially the proceeds being designated into a trust.  And as I say, Anne Werker has flushed out the mechanics behind that.  But there are ways to protect and help protect minor beneficiaries, allowing it to come outside of the estate.  And then there are, of course, ways to designate beneficiaries within the estate by simply putting, for example, the insurance proceeds into a testamentary trust that has been established under the terms of the Will.

 

Suzana Popovic-Montag:  And I guess the benefit with that kind of arrangement is then that you can appoint a trustee for those funds, who could hold the funds for the benefit of the minor until he or she attains the age of majority.  Because otherwise, as far as I understand it, if you were to designate a minor as a beneficiary, then that money would, without, you know, some trust arrangement otherwise being established, that money would be payable into the Court and held by the Court until the child turns the age of 18, is that right?

 

Ian Hull:  Well, that’s right.  And the other way, of course, we could control that money is if we go under the Children’s Law Reform Act and get appointed guardian of the minor child’s property before they turn 18, so proceeds from an insurance policy that aren’t properly designated, are either going to end up in Court or they could end up in the hands of the parent after what can be a relatively expensive process of applying to the Court to essentially gain control of those monies for your minor child.

 

Suzana Popovic-Montag:  So the point then really being that even though you think you’re doing all this fancy planning by designating a beneficiary other than your estate to receive these proceeds from life insurance, RRSPs or the like, you also want to keep in mind that there’s a practical consideration there in terms of the age of that beneficiary as well.

 

Ian Hull:  For sure.  Let’s turn now to designations generally.  Now, we’ll use the Ontario example because under the Succession Law Reform Act, there are fairly basic rules that have been established as to how and what we can do in designations of beneficiaries.

 

Suzana Popovic-Montag:  And as I said before, you can use your Will to actually create a trust so that you can appoint, you know, trustees, designate who the beneficiaries of the trust funds will be, and empower the trustee with rights and obligations and duties that wouldn’t otherwise be the situation if the money were simply paid into Court.

 

Ian Hull:  And under the Act, for those who are interested in seeking this, you know, so the background is is that we need to look to Section 51…I’m just trying to read my Act here…51 of the Succession Law Reform Act, and that points us to some of the rules surrounding and the statutory authority for making these kinds of trust designations and creating these kinds of designations for beneficiaries under a Will.

 

Suzana Popovic-Montag:  And just as a practice point I think in terms of where you actually put this provision in a trust when someone’s actually drafting it, you typically will see it set up at the very beginning of a trust before the other provisions in the Will so that it’s separate from the other estate assets and therefore free from possible claim for probate fees on that trust as well.

 

Ian Hull:  So, and then to just step back on our sort of last rounding up of this issue, designation of beneficiaries, we also, you know, we’ve got the more complex situation where you have minor children.  Or if you have a disabled child, where you want to create these trust arrangements.  But the basic scenario and one that is used effectively in estate planning is to simply pass an insurance, for example, an insurance policy, directly to the surviving spouse.  And that’s the one we see most often where a husband and wife situation where the husband or the wife owns an insurance policy and then they simply say, fill out the form when they apply for the insurance policy and they put down beneficiary designation being the wife.  It creates some great planning abilities, it avoids the estate tax in Ontario, it gives you creditor protection so that those monies can pass to the surviving spouse notwithstanding your own estate situation and it is so important.  And I tell my clients it’s so important that we want to sit down and re-visit those designations of beneficiaries, whether it is a complex scenario.  That’s one that would trigger a re-visiting most naturally, but even in simple situations, you want to make sure, I tell my clients you want to make sure that you’ve not got situations where, for example, the insurance policy for $100,000 is being designated to the estate.  You will create a tax problem for the estates administration tax, you will lose your creditor protection quite possibly if it’s going directly to the spouse, and it may not make sense in most situations.  It may make sense in other situations but it’s a personal choice that you want to look at your global estate plan before you’ve made your final decision on the designation of beneficiaries, which people don’t…most people don’t do when they’re filing their insurance policy application.

 

Suzana Popovic-Montag:  That’s a great point Ian, and in addition, I think you want to re-visit it too as your circumstances change, because it may turn out that you’ve designated a former spouse, for instance, as a beneficiary of some proceeds.  And then when you pass away, that might not have been necessarily what you would have otherwise intended.  So as your circumstances change, you want to make sure that those designations are still what you intend them to be.

 

Ian Hull:  No, that’s a great point.  We’ve seen cases like that and it’s frustrating for the family sometimes when they get in a situation where they’ve gone and the marriage breakdown, they’ve changed their Wills as they are told to do but they forget to deal with the insurance designations and the policy ends up somewhere where maybe it shouldn’t.

 

Suzana Popovic-Montag:  And quickly so too, because our experience seems to be that those policies are paid out quite quickly to the named beneficiaries.  So in that case then, if it’s paid out to someone you wouldn’t have wanted it to be paid out to, then you’re faced with a situation where you’re trying to chase the money back, and good luck to you in those situations.

 

Ian Hull:  Absolutely.

 

Suzana Popovic-Montag:  Okay.  Well thanks very much, Ian.  I think that brings us to an end of this podcast.

 

Ian Hull:  Thanks Suzana.

 

You’ve been listening to Hull on Estate and Succession Planning with Ian Hull and Suzana Popovic-Montag.  The podcast you have been listening to has been provided as an information service.  It is a summary of current legal issues in estates and estate planning.  It is not legal advice and you are reminded to always talk with a legal professional regarding your specific circumstances.

 

To listen to other Hull On podcasts, or to leave a question or comment, please visit our website at www.hullestatemediation.com.

 

Our theme music is UpTempo14 by Gary and is courtesy of the Podsafe Music Network.

 

/mem

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Like it or loathe it, the recent federal budget is an election budget, and strives to do something for everyone.



From an estate planning prospective, it reaches out to families with a disabled member, by establishing the Registered Disability Support Plan (“RDSP”).



The plan is available in 2008, and is similar in style to the current Registered Education Savings Plan. An individual who is eligible for the disability tax credit, their parent or legal representative may establish an RDSP.



The intent is that the RDSP would provide an income for the disabled individual once they attain the age of 60.



Under an RDSP, parents, beneficiaries or others will be able to contribute a lifetime maximum of $200,000. Contributions can be made until the beneficiary is 59. While contributions are not tax-deductible, investment income earned on investments within the plan will accrue tax free, and will be attributed to the beneficiary when paid out.



The Government will provide matching contributions, depending on family income. The matching grants are between 100 and 300%! The lifetime matching grant is $70,000.



Benefits paid out under the RDSP will not reduce any federal income-tested benefits. It is stated that the federal government will work with the provinces in order to ensure that the RDSP is “an effective saving vehicle to improve the financial security and well-being of children with severe disabilities.”



The effectiveness of the meshing between the federal plan and the provincial support programs, such as Ontario’s Ontario Disability Support Plan, is yet to be seen.



Thank you for reading,



Paul Trudelle

• Email This
• Print
• Comments
• Trackbacks
• Share Link

LISTEN HERE

READ THE TRANSCRIBED PODCAST

During Hull on Estates Episode #44, Jason Allan and David Smith discuss the duties and obligations of trustees with specific consideration to trustees of discretionary trusts. They discuss various claims available to beneficiaries against a trustee who is alleged to have acted improperly and the defences available to the trustee.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Understanding frequent causes of estate litigation can help avoid an estate dispute.

As I mentioned in yesterday’s blog, in Ian Hull’s book “Advising Families on Succession Planning, the High Price of Not Talking”, he comments on a number of common causes of estate litigation.

In this and tomorrow’s blog, I will review some of these common causes.

A lack of understanding of the need for an estate plan, or the reluctance to seek advice, can cause a dispute. Regrettably, many people die without knowing what an estate plan could have accomplished with their estate or the disputes that a plan might have prevented. An estate plan should, among other things, ensure that your assets go to those people you intend them to go to.

Obtaining inadequate estate planning advice can also lead to an estate dispute. One should look for an estate planning professional, typically, a lawyer, an accountant, financial planner and/or insurance professional who also has experience with your personal circumstances or, alternatively, can be made aware of all of the details of your circumstances. It is perhaps trite to say that as families have very different circumstances from one another, an estate plan for one family’s circumstance will not be appropriate for or applicable to another’s.

If your circumstances have changed, an existing estate plan may no longer reflect your intentions regarding your estate. As such, it is important to keep your estate plan current with new circumstances. Circumstances that should cause you to review your estate plan are, amongst others, if a principal beneficiary dies, you marry, divorce or remarry, a child or grandchild is born, a beneficiary or dependent of yours becomes disabled, the value of your assets have significantly increased or decreased, your beneficiaries under your RRSPs, pension plans or insurance policies are redesignated or have their entitlements changed, you establish a secret trust, a business interest of yours has changed (i.e. a partnership has dissolved or a company has been incorporated), and/or tax or other legislative changes have occurred that might effect your estate plan.

In tomorrow’s blog, I will discuss several other common causes of estate disputes.

Have a great day.

Craig.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Part V of the Succession Law Reform Act (“SLRA”) provides the legislative framework for claims by a dependent of an estate. It sets out:

(i) who is a dependent;
(ii) what rights a dependant has in relation to the estate;
(iii) the circumstances the court should consider in determining the amount of support that should be awarded; and
(iv) the kinds of orders the court can make for the satisfaction of a dependent support claim.

Rule 60.11 of the Rules of Civil Procedure explicitly states that a party may pursue a contempt motion in order to pursue those who violate court orders other than for the payment of money.

Some have argued that, even in the face of the language of Rule 60.11, support orders involving the payment of money should be enforceable through a contempt proceeding.

In 2000, in its decision of Forrest v. Lacroix Estate (2000) 187 D.L.R. (4th) 280, (Ont. C.A.) the Court of Appeal set aside a contempt order made as a result of a failure to pay a SLRA dependent support award, affirming that Rule 60.11 does not permit contempt orders for the payment of money.

At the contempt proceeding in the Forrest case, the Judge attempted to reason around the language of Rule 60.11 regarding the payment of money in considering the contempt. The testator had named his son trustee and sole beneficiary of his estate, valued at $900,000. The testator died without making provisions for his common law wife of 19 years. The son dissipated the estate assets in the face of a specific order prohibiting dissipation, such that the value of the estate was reduced to $48,000 at trial. The son was ordered to pay the common law wife $300,000 under the SLRA. The wife moved for an order holding the son in contempt of court for failing to pay. The son was ordered committed to jail for nine months unless he purged contempt within 28 days by paying the common law wife. The contempt order was made as the Judge held that such an order was akin to orders enforcing family law support payments, and as it is in the public interest that those who choose to ignore court orders should be punished.

The Court of Appeal, however, after an extensive canvassing of the law, was unequivocal in finding that Rule 60.11 contempt orders cannot be used to enforce orders for payments of money, including the payment of SLRA dependant support awards or for payments under the Family Law Act.

The Court of Appeal’s decision in Forrest was followed by the Ontario Court of Appeal in its decision in Murano in 2002. In discussing the requirements for contempt motions under the Family Law Rules, the Court of Appeal adopted the decision in Forrest, writing:

“…the effect of rules 60.05 and 60.11(1)…is to remove the court’s inherent jurisdiction to use the contempt power to enforce an order for the payment of money in cases governed by the Rules…It was taken as a given that the plain language of 60.05 and 60.11(1) do not permit contempt proceedings under those rules to enforce orders for the payment of money…I find that the reasoning in Forrest v. Lacroix, is equally applicable to the Family Law Rules.”

While contempt motions may not be used to enforce the payment of SLRA dependent support awards, they may still be appropriate to address the failure of a party to transfer assets (other than the payment of money) as required or the failure to act pursuant to an Order in respect of assets (and/or liabilities) in proceedings involving the SLRA.

Have a great day, Craig.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

We have made note this week of the fact that a beneficiary designation is subject to considerably less legal formality than a Will. The fact that many Canadians do not have Wills often means that the designation of a beneficiary is the primary means by which an individual engages in estate planning. This is particularly true of those in their thirties or forties whose largest assets will often be RRSPs or life insurance policies. We have noted that such estate planning has the benefit of clearly directing assets to the intended beneficiary without the need for obtaining probate of a Will.

Certainly, non-legal professionals such as financial advisors will frequently highlight the benefits to their clients of structuring their affairs in such a way as to minimize estate administration tax. Lawyers, as well, will recommend such benefits, mindful of the pitfalls associated when a beneficiary does not act as intended. For instance, where an individual designates a beneficiary of an asset, not for that person's personal benefit but rather, to distribute in accordance with a Will or some other written or verbal instructions (ie. a secret trust), the issue of trust becomes paramount.

What if the beneficiary does not distribute the asset as the deceased intended but keeps it for herself? For the litigation lawyer, it may be a serious challenge to prove a breach of trust on behalf of disappointed beneficiaries. The designated beneficiary can simply take the position that she has received all right, title and interest in the asset. If the designated beneficiary is herself named executor of the deceased's estate, there may well be some legitimate questions as to whether she was expected to distribute the asset in accordance with the Will. The designation, if contained in the Will, may ideally clarify whether the asset is to be subject to the terms of the Will.

Have a great weekend and we'll be back on Tuesday, David. --------

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Yesterday's blog introduced the topic of beneficiary designations and considered the law in Ontario as it related to the making of beneficiary designations. Today, we consider the law as it relates to the revocation of such beneficiary designations. This applicable statute is section 52 of the Succession Law Reform Act which, as annotated, reads as follows (with underlined words added for emphasis):

s. 52(1) A revocation in a will is effective to revoke a designation made by instrument only if the revocation relates expressly to the designation, either generally or specifically.

The revocation of a RRSP, for example, must reference the RRSP in sufficient detail, to leave no doubt as to which instrument is being revoked. However, the Courts have had to consider how to interpret this subsection. We will consider this issue further in tomorrow's blog.

(2) Despite section 15*, a later designation revokes an earlier designation to the extent of any inconsistency.

*Section 15 of the SLRA states that a will is revoked only by: marriage, a later will, a written declaration made with the formality of a will, or destruction by the testator or another person under his or her presence and direction.

(3) Revocation of a will revokes a designation in the will.

(4) A designation or revocation contained in an instrument purporting to be a will is not invalid by reason only of the fact that the instrument is invalid as a will.

This subsection is potentially very problematic as, presumably, the objections raised to the validity of the Will such as the capacity of the testator will have a direct bearing on the validity of the beneficiary designation.

(5) A designation in an instrument that purports to be but is not a valid will is revoked by an event that would have the effect of revoking the instrument if it had been a valid will.

(6) Revocation of a designation does not revive an earlier designation.

(7) Despite section 22, a designation or revocation in a will is effective from the time when the will is signed.

Section 22 of the SLRA states that a Will speaks and takes effect as if it had been made immediately before the death of the testator. As we can see, section 52 is a fairly exhaustive list of the possible scenarios that may unfold relating to the revocation of beneficiary designations. Tomorrow's blog will consider these provisions in further detail.

Have a great day, David. --------

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Hello, my name is David M. Smith and I am a partner (and now one of the resident bloggers) at Hull & Hull LLP. The focus of this week's blogs will be on beneficiary designations. While the natural tendency is to focus on the assets of the estate, we know that the reality is that, quite often, those assets which pass outside of the estate by way of beneficiary designation will exceed the value of the estate assets.

Indeed, an increasingly common estate planning tool is to hold as many assets as possible outside of the estate, primarily as a legitimate means of avoiding estate administration tax (more commonly known as probate fees) and, in certain cases, protection from creditors.

The most common example of such assets that come to mind are Life Insurance, Registered Retirement Saving Plans ("RRSP") or Registered Retirement Income Funds ("RRIF"). Similarly, (and an issue to be considered in future blogs), assets that are jointly held (unless impressed with a trust for the estate) will pass to the surviving joint owner by right of survivorship.

The making and revoking of beneficiary designations are not always simple matters and, regrettably, litigation may ensue where there is uncertainty. Recent caselaw has raised some interesting twists on this developing area of estate litigation.

In Ontario, the provisions of Part III of the Succession Law Reform Act relating to the making of a beneficiary designation are contained in section 51 which reads as follows (within underlining added for emphasis):

s. 51(1) A participant may designate a person to receive a benefit payable under a plan on the participant's death,

(a) by an instrument signed by him or her or signed on his or her behalf by another person in his or her presence and by his or her direction; or (b) by will, and may revoke the designation by either of these methods.

s. 51(2) A designation in a will is effective only if it relates expressly to a plan, either generally or specifically.

A "plan" is defined for the purpose of Part III to mean a myriad of financial vehicles but generally relates to Pension Plans, RRSPs and RRIFs. The SLRA does not govern beneficiary designations under all pension plans.

The SLRA excludes plans such as RRSPs issued under Part V of the Insurance Act.

An "instrument" is not defined in the Act. The Act does not require that revocation by instrument follow any particular form or formality (Burgess v. Burgess Estate (2000) 52 O.R. (3d) 61.) Accordingly, it is not necessary for a beneficiary designation to be witnessed by two persons as is the case with a Will.

We will consider the revocation of beneficiary designations in tommorrow's blog.

Have a great day, David. --------