Do’s and Don’ts of Adding Beneficiaries to a Will

A recent legal challenge, in the British Columbia Supreme Court case of Becker v. Becker, 2016 BCSC 487, was brought to settle an elderly woman’s estate. This case provides helpful do’s and don’ts of adding beneficiaries to a will.

The Situation: Late in life addition of beneficiaries who are not “next of kin”

Ann Andrews had no children of her own, but her common-law husband, Mr. Becker, had four grandchildren that Ms. Andrews had known for almost 30 years. In late December 2011, Ms. Andrews was hospitalized with an inoperable brain tumour. While in the hospital, she made a new will leaving everything to Mr. Becker, with the remainder of her estate to be split between Ms. Andrews’ six godchildren when Mr. Becker died. Five days later, after prompting from Mr. Becker, Ms. Andrews made another will, this time adding Mr. Becker’s four grandchildren as beneficiaries. So, by the terms of that most recent will, there would be ten “residuary beneficiaries” instead of the original six (Ms. Andrews’ godchildren).

Ms. Andrews died on February 10, 2012 at the age of 73. After Mr. Becker died in 2014, the six godchildren challenged the most recent will – they wanted the original will to govern so they would get a larger share. The court looked at all of the circumstances surrounding the addition Mr. Becker’s grandchildren as beneficiaries and decided that the most recent will was valid. As a result, the six godchildren had to share the residue of Ms. Andrews’ estate with Mr. Becker’s four grandchildren.

Here are the do’s and don’ts that can be drawn from the court’s decision:

1. Do make sure that the will-maker’s intention is clear when the will is changed to add beneficiaries who are not next of kin.

It can be a red flag when a new will is made to benefit someone who is not next of kin, especially when that person only recently came into the will-maker’s life. That was not so in Ms. Andrews’ case, as she had known Mr. Becker’s grandchildren for years and had watched them grow up. She had as close of a relationship with them as she did with her own godchildren. It was simply an oversight that she didn’t add them as beneficiaries in her earlier will.

2. Don’t allow the will-maker to be dominated or “unduly influenced” by another person.

It was concerning that Mr. Becker played a role in contacting the lawyer to have Ms. Andrews’ will changed to add his grandchildren as beneficiaries. It was also troubling that Mr. Becker was present for significant parts of the initial meeting with the lawyer. However, the lawyer who prepared the new will was careful to confirm, in Mr. Becker’s absence, that Ms. Andrews truly wanted to add Mr. Becker’s grandchildren as beneficiaries. Also significant was that Mr. Becker was not present when the new will was executed.

3. Do ensure that the will-maker is mentally competent to give instructions to add beneficiaries to the will.

Mental capacity can fluctuate, especially when the will-maker is elderly or suffering from a terminal illness that may cause confusion or memory problems. At a minimum, the will-maker has to have an understanding of the value of their estate and the potential beneficiaries.

The lawyer who assisted with the new wills met with Ms. Andrews on four occasions over the span of eight days and judged her capacity each time. Evidence of Ms. Andrews’ doctor also helped to establish that Ms. Andrews was bright and alert, even though she was very emotional and knew that death was imminent.

4. Don’t overlook the importance of timing if the will-maker does have diminished mental capacity.

The two key time periods are:

• When the will-maker gives instructions to prepare or make changes to the will; and
• When the will is executed.

Ideally, the will-maker should have intact mental capacity at both of those key time periods. However, the courts recognize that mental capacity can fluctuate, so some variation may be allowed. For example, the will of a person who is competent to give instructions, but has lost capacity when the will is executed, may be valid so long as, at the time the will was executed, the person was capable of understanding that she was executing a will prepared in accordance with her previous instructions.

Ms. Andrews very emotional and confused when giving the initial instructions to the lawyer who prepared the first new will in the hospital. Ms. Andrews’ godchildren pointed to that as raising suspicion that Ms. Andrews may not have had the necessary mental capacity to add Mr. Becker’s grandchildren as beneficiaries to her will. However, the evidence showed that at all subsequent meetings with the lawyer Ms. Andrews was brighter and clearer, less emotional, and could converse easily. Ms. Andrews’ confusion at the first meeting was more likely because she had recently been told she had an inoperable brain tumor – in other words, it was due to her emotional state rather than cognitive decline.

On all of the evidence, the court found it was reasonable that Ms. Andrews would want to include the Becker grandchildren and that she had the mental capacity needed to add beneficiaries to her will.

Take Home Point on the Do’s and Don’ts of Adding Beneficiaries to a Will

The above do’s and don’ts of adding beneficiaries to a will provide helpful guidelines when dealing with changes to an estate plan. However, it is important to keep in mind that overall, the question of whether a beneficiary has been validly added to a will always depends on the specific facts and circumstances of the case.