What is apparent to you might not be real for your family members when it comes to your estate intentions
The thought of your grown children and their step-parent, your spouse, wrangling over your will and its interpretation after your death is something that nobody wants to become a reality.
A recent case in Western Canada illustrates how seeking legal advice early on might prevent that scenario from playing out in your family.
A man and his wife, both previously married with children, had been married to each other for 15 years when he became terminally ill.
At that time the man owned, among other assets, some farmland that he had inherited from his parents and that was held solely in his name.
Soon after being diagnosed he had a will prepared and drafted at a trust company. This was done by a financial adviser who followed his instructions.
The will gave his wife a life-interest in but no ownership of the farmland. Per its instructions, she would receive the income from the farmland for the rest of her life, and at her death the land would pass to her husband’s two grown children.
A few months later the couple re-visited the trust company together. This time, they obtained the necessary documents to change title of the farmland. Subsequently, they changed the names on the title to include hers as well as his.
After filling out the documents they returned to the trust company to have their signatures notarized. At no time did they seek legal advice, but by this act the pair effectively prevented his children from receiving the farmland upon his death.
The change in the title trumped the will. It meant that the wife and stepmother would be the sole owner of the land and therefore could sell it if she chose or bequeath it to whomever she chose.
The couple registered the title change at the land titles office themselves, apparently without his children’s knowledge. Within a year, the man died.
Upon learning the contents of the will, the man’s children sued their stepmother for “exerting undue influence” upon their father. For that reason, they said, they did not receive the farmland that they would otherwise have inherited upon their father’s death.
To support the contention of undue influence, it was pointed out that the husband had a Grade 8 education, was on pain medication, depended on his wife to drive him to and from appointments and had not received legal advice about transferring the land into joint names. The children described their father as confused, vulnerable and dependent on his wife at the time when the land was transferred into joint names.
And, they maintained, because their father did not have legal advice about the transfers, the transfers should be set aside.
The judge disagreed, citing a lack of evidence to support the contention that the husband was confused or dependent on his wife. The lack of independent legal advice was not necessarily fatal, he said, and ruled that the particular circumstances of this relationship did not assume undue influence. A Provincial Court of Appeal agreed with that finding.
Laurie Pawlitza, who practices family law in Toronto, said that if legal advice had been given at the time the title was transferred, the outcome might have been different.
“In this case, had legal advice been given, the lawyer’s file would have been produced at trial and the lawyer would have been a witness, whose evidence would doubtless have been that the husband was advised and understood the effect of the transfer into joint names. Very likely, this would have ended the dispute.
“Instead, the family went through a lengthy and expensive trial, appeal and an application for leave to appeal to the Supreme Court of Canada.
“This could have all been avoided if they had simply gotten legal advice when title was transferred,” she said.