Grim reality: Have your estate plans in place in the face of COVID-19 pandemic

Mar 20 • COVID-19, Feature Story, LifeNo Comments on Grim reality: Have your estate plans in place in the face of COVID-19 pandemic

By Daniel Whittal
Special to The Voice

The rapid global impact of the COVID-19 coronavirus has been unsettling, to say the least. Social norms that we have taken for granted have been pulled out from under us and left us bewildered and nervous for the future. The sad fact is many Canadians are not prepared for the implications of a global pandemic in terms of their own safety and security.

As a lawyer who works closely with estate planning clients and estate trustees, I am concerned about the potential fallout during a global health crisis for Canadians who do not have a will or Powers of Attorney in place. This lack of preparation by what some have estimated to be over half of the adult Canadian population could quickly become a critical issue, leaving loved ones unable to make emergency health-care decisions and further bogging down our already busy court system for years to come.

We’ve seen how quickly the current situation has escalated, and while estate lawyers are always cautioning clients to prepare for the worst, it’s often too late by the time people realize the value in that kind of forward-thinking preparation.

I do not think it’s too late for people to correct the mistake of putting off their estate planning, but I would encourage them to act quickly. While we remain optimistic that our widespread social distancing efforts will stem the spread of the coronavirus, we know that the situation can change rapidly, and now is the time for Canadians to take action on this front.

Many of us have a bit of extra time on our hands right now – I would urge Canadians to put it to good use and review their estate plan. As you take stock of your own estate plan, pay particularly close attention if any of the following circumstances describe you:

If you do not have a will or powers of attorney

If you do not have a will, now is the time to get one. Stop putting it off. If nothing else can convince you, let this current global crisis do it. If you are over the age of 18 and own anything, you should get a will. Now.

If you have a will but need to change your executor or attorney

Having an estate plan is not useful if you don’t appoint the right person to carry it out. Many people made a will years ago, and named an executor that was appropriate at the time, but is no longer appropriate due to that person’s death or a change in life circumstances. If that is the case, you should update your will.

If you have become separated or divorced since making your estate plan

Simply put, this is one of the biggest issues we see in estate planning. Most couples make mirror wills, which means they name each other as executor and beneficiary. When you are separated, your will provisions don’t automatically change. So if you’d named your separated spouse as your estate trustee or beneficiary, then that is still the case even if you’ve separated.

The law around a divorced spouse being named as a beneficiary or executor is even more complicated. If you named your previous spouse in your will, that person gets skipped over – as if they were dead – and if you don’t have a backup beneficiary or executor, then your estate is in for an expensive, complicated court process – one that could have been avoided with proper planning.

If you have gotten married since making a will

Many people are unaware that – unless it specifically says that it is made “in contemplation of marriage” – a will becomes void upon marriage. If you have a will but have been married since making it, then you no longer have a valid will and need to make one as soon as possible.

If you are in a common-law relationship

If you are in a common law relationship and die without a will, your common-law partner will receive nothing. While other laws have evolved to recognize common-law partnerships, estate law has not.

If you have had children since making a will

Upon having children, there are important factors that must be addressed in your will, including appointing guardians, making provisions for your child’s inheritance, and making trust provisions for minor children.

If you own a business

Business owners have unique needs that may need to be addressed in a will, especially when that business is a corporation.

If you have a will but no powers of attorney

A power of attorney is a document in which you appoint someone to manage your affairs when you are still alive, but incapable. This is done in two separate documents: one of which appoints someone to make health care decisions on your behalf, and the other of which appoints someone to make financial and property decisions on your behalf.

It is now standard practice to prepare powers of attorney at the same time as a will. It wasn’t always that way though, so a number of people have a will but do not have powers of attorney. If you made a will more than twenty years ago, you should review whether you also made powers of attorney.

Estate lawyers are constantly reminding people to make a will, review their estate plan and update their documents regularly. Sometimes we feel like broken records, and we might seem alarmist, but we do it because we’ve seen what can result when people put it off. The first time you have to sit at a conference table with a grieving family and it’s your job to heap more bad news on them because their loved one didn’t make estate planning a priority, it changes your perspective.

Many of us feel uncertain about many things right now, but please don’t let your estate plan be one of them. Talk to your lawyer now to ensure you have an appropriate plan in place. Completing an estate plan isn’t a particularly exciting process, but it will provide some much-needed peace of mind in an uncertain time.

 

  • Daniel Whittal is owner and principal lawyer at Whittal + Company Law Firm in Chatham.

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