This week on Hull on Estates, Diane Vieira and Rick Bickhram discuss the issue of when an estate trustee is responsible to search for potential heirs to an estate.

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.

Posted on May 27^th, 2008 by Hull & Hull LLP

Megan Connolly: Hi, you’re listening to Episode #112 of Hull on Estates on Tuesday, May 27^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.

Paul Trudelle: Hi, Megan, how are you today?

Megan Connolly: Hi, Paul. I’m fine.

Paul Trudelle: We should introduce ourselves. I’m Paul Trudelle.

Megan Connolly: And I’m Megan Connolly.

Paul Trudelle: And today we thought we would talk about an issue that comes up time and time again. It’s an issue that plagues a lot of estates. It arises from the fact that people don’t always organize their affairs as neatly and as nicely as we would like. It’s the issue of lost Wills and what you can do in the case of a lost Will, where there’s a Will that you know existed but doesn’t exist now; what are the options open to the estate trustee under that lost Will or the beneficiaries of the estate.

Megan Connolly: And as a starting point, I think the first question to ask is, why do you know it’s lost? Where is it supposed to be? Do you have a Mom who you know made a Will, and was keeping a copy of it in her bedside drawer and suddenly it’s gone?  Or do you just know generally, you think your Mom made a Will and it might be out there somewhere. I think the first thing to do is establishing whether it’s lost or whether somebody, some sort of professional has it, and you’re just not sure who.

Paul Trudelle: That’s right. And I think that’s a key issue is just finding that Will, steps taken to find a Will. Often people know of the lawyer for the deceased and they can make inquiries of that lawyer and that lawyer might help you down the right path to finding the Will he made, or she may have a copy of that Will or may give you some information as to what happened to the Will, whether it was given to the deceased, where it may have been kept, other steps you would take. I guess there’s a number of other steps to finding the Will. We can talk about those in another podcast. But, if you do know that there was a Will and you have some evidence of that and the Will no longer exists, there are options open to you. And you can prove that lost Will or prove a copy of that Will and then have that copy admitted to probate if you’re able to find out with some certainty of the fact that it did exist.

Megan Connolly: I think one of the first determinations that need to be made is, has the Will simply gone missing or did the testator intend to destroy it? This is an important distinction. I may make a Will, decide I don’t want it to be in effect any more and tear it up. That would be me intentionally destroying it. Likewise, I could have a Will. It could get destroyed by accident, such as in a fire or something. I guess technically it’s destroyed but that doesn’t mean I intended to revoke it.

Paul Trudelle: Right and I think that’s a key distinction, is the intention. The Succession Law Reform Act talks about revocation of a Will and how it’s revoked. One of the ways a Will can be revoked is “by burning, tearing or otherwise destroying it” and I’m reading this from the Section now, “by the testator or some person in his or her presence and by his or her direction” and the key word is “with the intention of revoking it”. So if it’s destroyed, and there is an intention to revoke, then the Will will be considered to be revoked. And with a lost Will, if you don’t know where the Will is, there are presumptions in law that apply and the Court will find that if a Will is lost, they will presume that it’s been revoked, that it’s been lost through destruction with the intention of revoking it. 

So that is a key presumption that comes into play where a Will is lost and that’s a presumption that will fly unless there’s some way of overcoming that presumption.  And maybe we can talk a bit how that presumption can be overcome and what cases will a Court find that a Will is lost, however there was no intention to revoke the Will.

Megan Connolly: So one of the issues that comes up is tracing where the Will last was.  Was the Will last in the possession of the testator or was the Will somewhere else, like in the lawyer’s office? And this sort of goes back to that presumption of whether or not the testator intended to revoke it.

Paul Trudelle: That’s right. If the Will was last in the possession of the testator, and it’s not found at the time of death, the presumption is that it was revoked. However, you can overcome that presumption or the presumption won’t apply if the Will wasn’t in the possession of the testator. So, like you said, if the Will was with a third party, was left with a lawyer or someone else and then was lost outside of the control of the testator, then the Court will not find that there was an intention to revoke because it’s not an act that the testator did to get rid of this Will. And we’ve seen cases where Wills are in the possession of lawyers and they can be destroyed through fire or accident or in the possession or left with third parties and can be lost or sometimes they’re lost after the person dies. So the Will is there when the person dies.  Subsequently, however, through the act of cleaning up the

Megan Connolly: the house

Paul Trudelle: the estate, cleaning up the house, usually it goes out with all of the

Megan Connolly: all the garbage

Paul Trudelle: all the old newspapers

Megan Connolly: and the original Will

Paul Trudelle: and the original Will goes too.

Megan Connolly: goes to the dumpster.

Paul Trudelle: Now again, in those cases sometimes there is an intention to revoke but it’s not the testator who wants to revoke it. So that sort of evidence is what the Court will want to hear with respect to where the Will was and how it came to be lost.  And it’s often a difficult question to answer and I always bug my kids about that, where did you lose it? But, you know, if you can lead some evidence as to where it was when it went missing, that will help.  And either the presumption won’t apply or depending on whether it was in the possession of the testator, it may be held that the presumption does apply and then you’ve got the problem with the lost Will and prior Wills may be in effect or there may be an intestacy.

Megan Connolly: Now something that does arise is whether or not a copy of the Will can be found.  And one of the things that happens is a lawyer drafts the Will, gives the original to the testator. The lawyer maintains a photocopy of it in his file, although not always.  And when the Will, the original suddenly disappears, people look to the lawyer for the copy. Now that can help but, of course, it doesn’t necessarily speak to the fact of whether or not the testator intended to destroy the original or whether it simply went missing.

Paul Trudelle: Right, no, it doesn’t address that. But it does address the fact of what the Will actually said. So if the other evidentiary issues with respect to the lost Will can be overcome, then the Court at least has something to propound, has something to declare as being valid or reflecting the wishes of the testator.  So the Court can prove a copy of the lost Will or in some cases, where a copy doesn’t exist, the Court may receive evidence as to what the Will actually said from those who may have read it or prepared it.

Megan Connolly: So if you have a situation where there is no copy of the Will and someone wants to prove it, what would they do? What sort of evidence do you think would be helpful?

Paul Trudelle: Well again, the evidence with respect to how it went missing is going to be helpful, you know, necessary.  If there is some evidence from let’s say a lawyer who prepared the Will who can say that, “Yes, I prepared the Will, this is what the instructions were, this is what the Will said”, this is…and you can give evidence as to the circumstances as to its execution because that’s something that’s going to have to be proved as well.  And then can give some evidence as to what happened afterwards, you know, “I held on to it, I put it into this file and when we moved offices it was lost”. That evidence is going to be very helpful.  Notes and records that the lawyer may have kept or his recollection or her recollection with respect to the Will will be relied upon by the Court.

Megan Connolly: Providing the lawyer is still living. If he’s not, then you’ve got another problem.

Paul Trudelle: If he’s not, then it’s yet another evidentiary problem and you may be able to prove the Will is lost but no one knows what that lost Will said, in which case, the Court won’t find in favour of that Will and you may have an intestacy. Perhaps we can spend a minute or two talking about the procedure for proving a lost Will.

Megan Connolly: Okay.

Paul Trudelle: And the procedure is set out in the Contentious Proceedings Rule 75 that relates to estates. And it’s Rule 75.02 and it provides that the validity and contents of a Will that has been lost or destroyed may be proved on an application and then it sets out two different streams. The first stream is by Affidavit evidence, without an appearance, so it can be done over the counter, where all persons who have a financial interest in the estate consent to the proof.

Megan Connolly: Right, so that’s potentially a live issue, consent, right there, as being the operative word.  And if the beneficiary is under the lost Will and the beneficiary is under the intestacy or a previous lawyer different to you likely won’t be doing it over the counter.

Paul Trudelle: Consent might be harder to get in those cases.   But in a lot of cases, though, the Will says that, “all my estate goes to my two children” and the two children are the intestate beneficiaries, so they’re prepared to consent to what the Will says.  No one else has a financial interest in the estate, so it can often go over the counter. 

In addition to that, if there is no consent, then it’s to be proved in a manner provided by the Court in an Order giving directions under Rule 75.06.  So if it is a contentious issue and the beneficiaries on intestacy are different than the beneficiaries under this lost Will, then the Court will set out a procedure for dealing with that and will set out, you know, what the issues are to be decided, allow the parties to go out and obtain the evidence of anybody who has knowledge of the Will or knowledge of what happened to the Will, and then provide for probably a trial of the issues down the road.

Megan Connolly: Well, of course, the down side is if this happens, it’ll probably be…well, potentially contentious and may be an expensive way of going about things.  So if you have an original Will, I guess, try not to lose it.

Paul Trudelle: I think that’s a very fair message.

Megan Connolly: Well I guess on that note…

Paul Trudelle: On that note, maybe we will wrap up. We want to thank you for listening and if you have any comments, we ask you to send us an e-mail at hull.lawyers@gmail.com.

Megan Connolly:  Or you can give us a call at 206-350-6636 or visit us on-line at estatelaw.hullandhull.com.

Paul Trudelle: That’s great. Thank you, Megan.

Megan Connolly: Thanks, Paul.

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

Posted on May 13, 2008 by Hull & Hull LLP

Suzana Popovic-Montag:  Hi, and welcome to Hull on Estate and Succession Planning.  You’re listening to Episode #112 of our podcast on Tuesday, May 13^th, 2008.

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.

Ian Hull: Hi, Suzana.

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

Ian Hull:  I’m great thanks.  This week is a big week.  We had the pleasure earlier this week to record Hull On Estates as well, so we did both of the firm podcasts, so to speak.  Before we get into our topic today, I just want to remind everyone that we welcome comments and that’s our call-in number at 206-457-1985.

Suzana Popovic-Montag:  And, of course, that number, if you didn’t catch it, will be in our show notes as well as our e-mail address which is:  hullandhull@gmail.com, if you prefer to send us a comment by e-mail. 

Ian Hull:  So we had some really interesting blogs last week and I noticed yesterday’s blog was particularly interesting.  When I say yesterday, when it goes into the Internet we won’t know what yesterday is, but I encourage you looking at our blog as well, because it’s at hullandhull.com.  But we had some interesting comments by Chris Graham last week and Diane Vieira this week as well. 

Alright, now before…oh yeah, also our last podcast that we did on Hull On Estates, we spent more time than I intend to today, but we would like to again note with great enthusiasm that Terry Fallis, our great friend at Inside PR, has won the Stephen Leacock Medal of Humour Award, which was given to him last week.  And is an incredible result for him because he self-published his book, “The Best Laid Plans”, and as a result of winning the award, he also had the book reviewed in The Globe and Mail which was very exciting for him.  So, it’s a tremendous honour for him, no doubt, but well deserved.  It’s a terrific book called, “The Best Laid Plans”, and we congratulate you, Terry.

Suzana Popovic-Montag:  That’s for sure.  Congratulations, Terry.  Your book is outstanding and it’s great to see good things happen to good people.

Ian Hull:  Okay, so let’s talk about accounting.  And it seems like a good segway because no doubt Terry is counting his money as it comes in with his self-published book.  But we finished off our last podcast and the work that we’re doing really focusing…we touched briefly on the whole question of accounting.  But certainly, and it’s one of these things with podcasting, every week that we do this you live on the experiences of the week before, and unfortunately for the clients that I’ve seen in the last week, there has been a myriad of messy accounting situations come into our office.  And, you know, you do feel very badly for some clients who do not understand some of the basic expectations of an accounting that come from your role as an estate trustee.

Suzana Popovic-Montag:  And generally speaking, what you’ll do as an estate trustee, of course, is to try to keep as detailed an accounting as possible so that you can, at the end of the day, indicate everything that’s come into the estate and everything that’s been paid out of the estate and to whom.  And as part of that whole process, you want to prepare this accounting for review ultimately by the beneficiaries of the estate.

Ian Hull:  And one of the things I like to do before we get into some of the formal steps, is the informal step of making sure my beneficiaries know what’s going on, on a fairly regular basis.  And I compare it to a stockbroker or an investment advisor who would be expected to give quarterly updates as to the status of their account with their client, but certainly would expect it to do an annual update.  And many financial planners will sort of identify annually that they have to at least once a year sit down with their client.  They will be in contact with them throughout the year, but once a year they make an effort to go and see them or meet with their financial advisor.  And that’s sort of a good benchmark if I’m an executor.  And that’s just business thinking, not necessarily fiduciary law.  There is not, sort of, something written in stone, but it’s a good informal benchmark.

Suzana Popovic-Montag:  And we certainly know from our experience, Ian, that it just helps if people are kept informed.  As soon as there’s a cloud of some secrecy or not being fully apprised of what’s going on, that just leads to uncertainty with respect to the whole process.  So it just makes sense to provide this information, provide it regularly and provide it completely.

Ian Hull:  So carrying on with this theme that should we have done that or should we be in a situation where it is not contentious, there are no beneficiaries that are upset with our work as executor, at the end of the process, and the end of the administration, you can typically write to the beneficiaries sending out your accounts, maybe in an informal form, and look to them to provide you with a release.  And that release, before you finally distribute all the money, in most cases, and, you know, this is a complicated area, but generally speaking, if you can get a release, that, in most cases, will end your involvement and it will wrap up your disclosure obligations on the estate.

Suzana Popovic-Montag:  And just to keep in mind that you can get a release in situations where all the beneficiaries are adults and have consented to the accounts.  If, though, you’ve got an incapable beneficiary or a minor beneficiary of an estate, it’s not as easy.

Ian Hull:  That’s for sure.  So, let’s talk about the more formal passing of accounts because, like you say, there are situations where, if you have a minor or you have an incapable beneficiary, you simply have to formally pass your accounts.  But there are also cases where the beneficiaries will not agree to sign a release and close things off for you, so you still need to go into the Court system to pass your accounts.

Suzana Popovic-Montag:  And the ultimate goal, just for a passing of accounts, is to provide the executor with a release from the Court now because the beneficiaries themselves may not be able to or will not consent.  And so it’s basically a stamp of approval by the Court saying that what you’ve done during the course of this administration has been proper.  And that really is important to close the loop in terms of the fiduciary responsibilities of a trustee at the end of a day.

Ian Hull:  That’s such a good point.  Because really, at the end of a day, all we’re trying to do is allow for either an informal (when you just look for a release and a letter), or a formal audit of your work.  And when you’re an estate trustee, your work really is, although we’ve talked a lot about the kinds of things like worry about burial arrangements, worry about all of this.  When it comes right down to it, your work is fundamentally based on how you handle the money; paying the bills, paying the beneficiaries and so forth.  So there is this need at the end of the process for an audit.  And whether it’s formal or informal, you want to make sure you’ve done one or the other, finally wrapped up by a blessing from Canada Customs and Revenue, who will give you what we call a Clearance Certificate.  But that’s a little different in the sense that you do that right at the end.  And so, let’s talk a little bit about the process, so people can get a sense of what you’re going to get into should you be forced to pass your accounts in the formal courtroom setting.

Suzana Popovic-Montag:  And if you’re actually doing a formal passing, we would certainly recommend the assistance of an accountant or an account preparer who is familiar with the process of preparing accounts in Court format, because those are very different.  And I know my clients are always surprised by the fact that they’re very different from the normal financial statements that accountants prepare for companies.  And it’s a very different process.  So to the extent that you can have that done properly, right from the get-go, I think it saves time and aggravation at the outset.

Ian Hull:  And if you want to get an example, and we say this to clients and they sort of glaze their eyes over it, and say, “yeah, yeah, yeah, we’ll talk to the accountant”.  But if you want to get an example of what these accounts look like, go to our webpage and there’s a Breakfast Series that we produced, and in that we talk about various passing of accounts.  And we have precedents in there of accounts that Suzana and I worked up as a format account to show people what these things actually look like, because it’s hard to describe the form of estate accounts until you see them.  But it is essentially a bank book ledger, a start to finish line-by-line listing of all of the financial transactions which then isn’t in the courtroom but then has to be backed up by receipts; no different than the real world when you’re running your own chequebook and you’re balancing your own chequebook.

Suzana Popovic-Montag:  And in terms of the actual application itself, that’s really a very formalized set of requirements that are set out here in Ontario in our Rules of Civil Procedure.  So there is, for instance, a Notice of Application that has to be issued by the Court that will refer to the accounts, will refer to the period of time during which the accounts are being passed and also set out what the claim for compensation by the estate trustee is for that period of time.

Ian Hull:  And in the materials, and they’ll always include as well a copy of the Will, or the trust or whatever instrument that you’re passing your accounts under in that sense, so you can understand or the Court more particularly can understand what should have been done at law.  For example, if it was set up in a trust arrangement where all of the estate passed to the wife and then on her death, it passed to the kids; that’s a classic spousal trust arrangement.  Well, you need to look at the Will, make sure that that was the case.  Maybe there were some specific bequests as well that needed to be paid and the trustee missed that; maybe there were $100 gifts to all the grandkids and they were never paid or something like that.  When you check the Will, you make sure that those gifts were paid.  Those are the sorts of inquiries that, you know, this doesn’t take training as a lawyer to look for, but, you know, these are kinds of inquiries that you could make at this initial stage.  So, we’re going to start, I think at this point we want to talk in our next podcast in a little bit more detail about what the process is, so that you can get a feel for it.  But, again, the application itself sets the stage, so to speak.

Suzana Popovic-Montag:  Well I think that, Ian, will wrap up this podcast for this week.  I want to thank everyone for having listened and remind our listeners that if they have any comments, that if they’d like to phone and give us their comments by voicemail, feel free to call us at 206-457-1985.

Ian Hull:  And generally speaking, of course, getting a hold of us, chasing us down with an e-mail, giving us some comments is welcomed and encouraged.  We’ve got a hullandhull@gmail.com address and obviously feel free to go to our webpage at hullandhull.com, which will guide you through a myriad of options.

Suzana Popovic-Montag:  Well, thanks very much, Ian.

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

Such difficulties have led some commentators to espouse the viewpoint that a family member ought not to be an executor of an estate in which the family home is the most significant estate asset.  To my mind, such recommendation is a bit extreme:  each family is different and while there is no certainty as to how the children will interact with one another on the death of the surviving parent, it is worth noting that the vast majority of estate administrations are not referred to litigation counsel.

As noted in a recent article in the New York Times, the difficulties that may arise in the sale of the family home are often best resolved through the advice of a good listing agent and effective communication between the executor and his or her siblings. Such issues that may arise include: the appropriate list price, how to show the home to attract the most optimum sale price, and what upgrades (if any) to engage in and whether to use estate assets for this purpose.

David M. Smith

This week on Hull on Estate and Succession Planning, Ian and Suzana discuss how important it is to be prepared for an initial meeting with an estate lawyer.

They have also been listening to and reading David Maister's new (audio)book Strategy and the Fat Smoker and continue their conversation on The Tipping Point by Malcolm Gladwell.

Comments? Send us an email at hullandhull@gmail.com, call us on the comment line at 206-457-1985, or leave us a comment on the Hull on Estate and Succession Planning blog.

This week on Hull on Estate and Succession Planning, Ian and Suzana continue their discussion on what to expect in the early stages of estate administration.

Posted on January 8^th, 2008 by Hull & Hull LLP

Suzana Popovic-Montag:  Hi, and welcome to Hull on Estate and Succession Planning.  You’re listening to Episode #94 of our podcast on Tuesday, January 8^th, 2008.

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.

Ian Hull:  Hi Suzana.

Suzana Popovic-Montag:  Hi there Ian.

Ian Hull:  How are you doing?

Suzana Popovic-Montag:  I’m well, thank you.  How are you?

Ian Hull:  I’m good.  The holidays seem like a long time ago now.

Suzana Popovic-Montag:  Way too long.

Ian Hull:  They were way too short and it feels like they didn’t even happen.  But that’s okay.  We’re into a new year and having a great time moving through what is our mini series on what to expect, bringing some life to an estate administration.  So our last podcast we had some fun talking about this pre-probate stage.  And I think it’s worthwhile.  You were saying before as we were preparing for our podcast it would be worthwhile staying in this pre-probate stage because there are so many other issues that we could talk about before we get the fancy seal on the Court file.  And a lot of these issues are issues that can be dealt with on a homework basis, as you’ve described them and so have I.  So let’s talk about again where sort of we left off in our last podcast talking about what you called were testate estates or situations where there is a Will itself.  So let’s stay in that pre-probate framework and talk about that.

Suzana Popovic-Montag:  You know, one thing I wanted to mention, Ian, in terms of that is normally we have a situation where there’s a formal Will, a Will that’s been prepared by a lawyer . But that doesn’t mean that a hand-written Will prepared by the deceased and signed by him or her is not as equally a valid document.  And I know you talked about witness requirements and things like that during our last podcast.  But there are different requirements and rules that govern hand-written Wills, but they are equally effective at law.

Ian Hull:  Good point.  And we haven’t talked about that at all.  We’re sort of focusing on the conventional scenario but we can’t forget that less conventional scenario.  So why don’t we talk a bit about situations where you’re applying with a Will.  And you’ve got a fairly conventional scenario, or unconventional scenario - typewritten or hand-written.  One of the questions you’re going to be asked, and a bit of homework you can do, is get the details of who are all the estate trustees named in the Will that you have or you know about.  Are they alive?  Are they able?  Are they willing and competent to act?  Those kinds of details of where their addresses are, contact numbers and so forth.  This is just a good little homework exercise to follow through.

Suzana Popovic-Montag:  And another thing that you might want to consider is whether or not, and we’ve talked about these on previous podcasts, whether spouses are making elections under the Family Law Act for instance.  And if that’s the case, then there is case law that suggests that the Will is to be read as though that person has predeceased the deceased.  And so they won’t be entitled to be the executor of the estate and they won’t necessarily be entitled to gifts in the Will, as a general rule.

Ian Hull:  And you have, as usual, understated the importance of the case law because you did the Factum on the leading case on that issue.  And Reid vs Reid-Martin stands for that proposition that yes indeed, the surviving spouse has some problems acting as the estate trustee.

In terms of, you know, I guess another little detail point is you will need legal names of the estate trustees, addresses, occupations - you always have to note that in the probate application.  Other little details - you’ll want to get SIN numbers and dates of birth because sometimes they’re going to need that to open estate bank accounts.

Suzana Popovic-Montag:  I think you’ll also want to consider whether or not this is a situation where some of the named estate trustees may want to renounce.  And that’s the situation where someone decides I may be named, but I don’t necessarily want the job.  And in that case, they have to sign a formal document actually renouncing the appointment so that the other named estate trustees would have the authority to then continue with the administration.

Ian Hull:  Now that’s a very good point.  Alright, we’ve talked about situations where there is a Will.  Let’s turn now to situations where there is no Will, where we’ve got intestate estates, where you have to turn to the legislation in the different commonwealth jurisdictions that deal with situations where essentially the government tells you how the estate is going to be distributed.

Suzana Popovic-Montag:  And generally speaking, in those situations I think it’s usually the situation where you’re going to have that estate pass on to the next-of-kin, however that next-of-kin is actually defined.  And so the closest living relatives will be the ones who are, at first blush, going to be entitled to the estate.

Ian Hull:  So this is where I say you can do some of the most effective homework because this isn’t time you want to waste a lot with a professional across the table at hourly rates.  This is complex stuff that a professional is going to want to know almost to a level of detail that may seem almost irritating to the client.  And the reason why is, is that you used that term “next-of-kin”.  The term “next-of-kin” is a broadly defined term and one that…I mean, you’ve defined it perfectly…but one that has to be determined with great precision.  You have to make sure you don’t miss one possible next-of-kin or class of next-of-kin.  So to do that, you’re going to need some major information.

Suzana Popovic-Montag:  And you start, of course, with full legal names of all the family members that you know of, their addresses, their actual relationship to the deceased and their respective dates of birth.

Ian Hull:  And I will often just say to the client before they come to see me, listen, put together as best you can a family tree.  Show me where and when people were around and what sort of lineage, how it works.  So that you can start to get a bit of a visual as to what is going on, because the lawyer is going to be the one to fill in the blanks per se.  Now just because this is a bit of a complex area, at this point, let’s just talk a little bit about what happens when it’s not a straightforward situation.  Where the next-of-kin are a bit more distant.  Well, for example, you have situation where an elderly couple is married for 50 years, they have no children.  They have brothers and sisters but they never had kids.  And the brothers and sisters have kids.  So you’ve got different generations sort of swirling around.  And depending on who died first, and so on, who are the next-of-kin and so on.  What we’ll often do in situations were there is some uncertainty is we’ll hire a good trace or heir searcher to help us fill in the blanks.  And these people are fascinating.  Some of them they will go to cemeteries to chase down information, look at headstones, back it up and so forth.  And I guess what some…and some people might have heard of…are heir searchers who are not quite so clean in that sense that they usually will want a big piece of the action once they find these heirs, from the estate.  And what will happen is, is that for example if there is someone in England who is a beneficiary, a long lost beneficiary.  And so some of these heir search firms will take a fee, a fixed fee, a reasonable contingency fee or not so reasonable contingency fee.  We’ve seen some tremendous fees that come out, you know, which are just outrageous at some level.  But there are some really terrific heir searchers.  They’re needed.  They have a skill search that is unbelievable…what they can.

Suzana Popovic-Montag: It really is, Ian.  It really…I’m always astounded by the fact that they’ve got resources at their hands that we wouldn’t even necessarily expect.  And notwithstanding the fact that sometimes they can be very expensive, the truth is that estate trustees have a duty in these circumstances to locate family members, to locate the people who are entitled to the estate, to distribution of the estate.  And you don’t want a situation where you’ve possibly paid out the estate to the wrong family members.  And so it’s sort of a cost of doing business.  I know it sounds kind of crude but it is the term that we use when we say to the clients who are trying to administer these estates that it’s really, really important that this job be done properly.

Ian Hull:  And now, chasing down blood relatives is an expertise that these guys have.  The other expertise that we have, as lay people, that we need to employ in all this, is that you need to ascertain the nature of the relationships that the deceased entered into during his or her lifetime.  Not just the typical “I got a brother or a sister” or something like that, or a second cousin.  You want to make sure that we’ve nailed down all the relationships.  Say, twenty years ago, they had a relationship that you know about.  Maybe there were children out of that relationship you need to investigate.  There may be expanded relationships and situations where you have common-law spouses, where you have same sex spouses.  All of these matter for the different types of claims that can be made against the assets of the estate.  They may not be what we called “heirs at law” but they may be obvious claimants.  So it’s worth making the extra effort at the outset and ultimately if you don’t have the resources or the information, you can get your professionals to help you seek out these people and so forth.  But that is an important early step.

We don’t want to forget that, certainly in Canada, the nature of the relationship is crucial if you are a married spouse or you are not a married spouse as well.  Because you have special entitlements as a married spouse and you have other special entitlements if you’re a common-law spouse.  Different types of claims.  There are what we call the preferential share you would get if you were in a married spousal situation.  For the common-law, it’s different and the type of claim there is differently structured.  It’s structured by a dependants’ relief claim or something of that nature as opposed to what the statutes allow for as a preferential share in the claim.  So anyway, we don’t want to get in too deep on the claims side.  But it just shows you, it illustrates why this is important to chase down this information.  And we’re not suggesting this because we want to add work to the process or add layers of complexity.  We’re suggesting it because we want to solve problems at the outset.

Suzana Popovic-Montag:  And just to sort of tie this podcast up, Ian, I think another thing we want to keep in mind is the fact that we also have to determine whether or not there are any children born outside of the marriage.  And that matters for the same kinds of reasons in terms of the distributive share that people will be entitled to on an intestacy.

Ian Hull:  Absolutely.  I forgot about that.  So that’s very helpful.  Alright, so I think that’s a good start.  We will continue to work through this pre-probate stage and the homework and the preparation for our ultimate goal, and that is, to administer the perfect estate.  So we’re looking forward to many more talks and discussions about this in the year of ’08.  And the neat thing about ’08 is, we hope to hit 100 podcasts in ’08.  So that’s going to be an exciting day, probably not as exciting for everyone else, but you and I.  It will be a neat day to hit.  I don’t know how much celebration there will be involved.  It certainly won’t be champagne because we typically podcast early in the morning.  So we’ll try not to drink before noon in ’08.  That’s my new rule.

Suzana Popovic-Montag:  Well, thanks very much Ian.  And I do look forward to our next podcast.

Ian Hull:  Thanks a lot.  We’ll see you.

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

This week on Hull on Estate and Succession Planning, Ian and Suzana discuss what to anticipate as an executor and how to ensure that you are well prepared for your duties.