Estate Law – Common Pitfalls when Preparing a Will

At Onyx, we’ve seen many estate files where family members dispute the will because the will was prepared inadequately. Below, we’ve outlined some common pitfalls that may lead to litigation after the testator passes away:

1. Writing your own will;
2. Not making adequate provision for your spouse or children; and
3. Not understanding what ‘residue’ means.

Let’s explore each one of these issues in detail.

1. Writing your own will

For the purposes of convenience and to save legal fees, some people choose to write their own will. While you can download various will templates from the Internet, these templates are not ‘one size fits all’, and generally do not take into consideration each person’s unique financial circumstances and desired testamentary dispositions. Most importantly, these templates may not fulfil the formal requirements under the Wills, Estates and Succession Act (“WESA”) and as such may not be a valid will in British Columbia. As a result, even though writing your own will may save you some money in the short run, your loved ones and your estate may have to bear significant legal fees if the will is challenged or is otherwise ambiguous.

For example, in Burns Estate, 2013 BCSC 2199, the co-executors of the estate petitioned for the court’s opinion on the validity and interpretation of testamentary gifts and trusts made in a handwritten will.

The will gifted a sum “to my brother Richard Burns before any division of the estate happens”. The court was asked to interpret the meaning of the underlined portion. The court interpreted the underlined portion as meaning that the gift be distributed prior to the division of the residue of the estate.

On the issue of the validity of the trust, the court found that the testator failed to create a trust which met the proper requirements. In order to create a trust, the trust must have certainty of intention, certainty of subject matter, and certainty of objects. In other words, the testator must intend to create a trust, it must be clear who would benefit from the trust, and it must be clear what would constitute the trust property. The court found it was unclear who were to benefit from the trust. The relevant portion of the will reads as follow:

After these two requests have been honoured, I elect [sic] that my remaining estate which includes my wife [sic] contributions, will be split evenly between my heirs and my wife’s heirs.

Since my wife expressed her desire to have the money used for education and welfare of our second and [indecipherable] generation, I direct that Linda Moreau be elected as the [indecipherable] for one half (1/2) of my estate with full authority to spend the [indecipherable] result of the capital, with spending any of capital and seeing as a good administrator to invest to returns of capital.

Similarly, David and Eric for their children, evenly.

Since the residue of the estate was to be split evenly between the testator’s heirs (David and Eric) and his wife’s heirs, it was unclear whether the testator meant that his wife’s heirs would “similarly” also receive the residue “evenly” like David and Eric, or whether Linda Moreau had discretion to distribute any amount to each of the wife’s heirs as she saw fit. As such, the trust failed.

2. Not making adequate provision for your spouse or children

In theory, a testator is free to distribute his or her estate in any manner he or she wants. However, it has long been established that it is contrary to public policy to allow a testator to disinherit his or her spouse and children. WESA codifies this principle under section 60, which allows the court the power to vary the terms of the will if the will does not, in the court’s opinion, “make adequate provision for the proper maintenance and support of the will-maker’s spouse or children”. This is known as a ‘wills variation claim’. To learn more about wills variation claims, please explore our other articles:

• Estate Litigation: Common Reasons for Contesting a Will in BC
• Wills Variation: Life Estates; Legal & Moral Obligations
• Moral Obligation to Spouse Garners $225K Wills Variation
• Wills Variation Action Not Barred By Marriage Agreement
• Wills Variation Based on Post-Death Change in Circumstances
• Limitation period for wills variation in British Columbia

3. Not understanding what ‘residue’ means

The residue of an estate is the remainder of the estate after deduction of liabilities, expenses, fees, and specific gifts of assets and cash. For example, if there is an estate of $500,000, and the will provides that $100,000 be gifted to Linus, and the residue split equally between Sally and Charlie, then assuming there are no expenses and fees, Sally and Charlie would split $400,000. In other words, Sally and Charlie would each receive $200,000.

However, since the residue is everything remaining in the estate after deduction of expenses, fees, and specific gifts, it is possible that there is no residue.

For example, let’s apply the scenario above, except this time, the gift to Linus is $500,000.

Since the value of the estate is $500,000, after the gift of $500,000 to Linus, there is no residue for Sally and Charlie. As such, even though the testator might have thought that he or she had provided for Sally and Charlie, in reality, they would receive nothing.

If Sally and Charlie receive nothing, they might have recourse by contesting the will. To explore ways to challenge a will, read Estate Litigation: Common Reasons for Contesting a Will in BC.

If you would like more information, please visit our blog or call us for a free consultation.