After decades working with the same succession laws, Alberta is moving into the 21st century by amending various statutes which impact individual’s estates. The new legislation, to be known as the Wills and Succession Act, was proclaimed on February 1st, 2012. Some of the changes are retroactive, requiring individuals who may be affected to review their existing estate plans and determine whether changes are needed.
One significant proposed change, section 117, is still being studied by the Government. If passed, it may affect many individuals in second marriages, those with businesses they wish to pass to the next generation, or those with farming operations which will need to be rolled to the next generation. This is a provision which allows a surviving spouse to make a claim for a matrimonial property division AND in addition receive what is given under the will of the deceased spouse.
Such a change may negate some very careful estate and succession planning. Luckily there are ways around these issues with the use of spousal trusts, prenuptial and postnuptial agreements, mutual wills and the insertion of clauses which provide for the disinheritance of those who bring an application against the estate.
Section 117 may be added to the Act at a later date. The provisions may not be enacted exactly as proposed so we will continue to monitor the situation and keep you informed of further changes.
Distribution of estates on intestacy (where no will exists) will change substantially, and arguably, for the better. Where a spouse dies leaving a spouse and children, all of the estate will go to the surviving spouse if the children were all of the marriage or relationship of the deceased and the surviving spouse.
However, if the children are not all of that relationship, the spouse will receive 50% of the estate or the amount of the preferential share of $150,000, whichever is greater.
Where the deceased and the surviving spouse were separated for more than two years, the surviving spouse does not receive a share of the estate. However, the surviving spouse may still have a claim under the Matrimonial Property Act or as a dependant.
If there is no spouse or children, the estate goes to the closest degree of living decendants.
These are only two of the areas that are affected by the new legislation.
Other changes include the following:
- Marriage or the signing of an adult interdependent partnership agreement will no longer nullify a will, if the will is made after February 1st of 2012;
- A spouse or interdependent partner has the right to stay in the home of the deceased for a three month period, although this may be extended if there are dower rights to the home;
- Children over 18 and still enrolled in full-time school can make a claim for support until the age of 22;
- Minor grandchildren who were supported by their deceased grandparent can make a claim for support from the grandparent’s estate; and
- If a marriage or adult interdependent partnership agreement ends before the death of a spouse, any gift in a will is revoked, provided the relationship ends after February 1, 2012.