What do Marriage, Cohabitation, and Break-ups have to do with your Estate, anyway?
When you get married or cohabit with a significant other for at least two years, you may have automatically chosen an “estate plan” for yourself, whether you intended to or not. The same may apply when such relationships end. In view of this, everyone should be aware of how the estate laws apply to these common life events. Otherwise, unintended consequences can result.
So you got married…
The new Wills, Estates and Succession Act (WESA), which came into force on March 31, 2014, is the governing law for estate matters. Prior to WESA, the law provided that marriage would automatically revoke your existing will; that is, unless you had provided otherwise in the Will. Essentially, the former law assumed that people’s testamentary intentions changed with their marital status.
In contrast, WESA has changed this. If you have an existing Will prior to getting married, it now continues to be a valid Will after marriage. Because of this, if your Will as a bachelor(ette) does not reflect your testamentary intentions relating to your spouse, then it will be a good idea to have it revised. If you do not provide adequately for your spouse, he or she has a right to challenge the Will in court, and if he or she is successful, the court may then effectively revise your Will after your death according to what the court thinks is fair.
Note that if your Will was revoked by marriage prior to March 31, 2014, it remains revoked and you must execute a new one as soon as possible.
You’ve been living together for two years or more…
The above discussion assumes that you have not already been cohabiting with your significant other. However, many couples often live together before tying the knot, or remain this way indefinitely. So how does this affect things?
Once you have lived in a “marriage-like relationship” with someone for at least two years, WESA treats them as a “spouse” – or what we often refer to as a common-law spouse. Under estate law, a common-law spouse is treated no differently than a married spouse. As such, if your Will before does not reflect your testamentary intentions towards your common-law spouse, then it would be a good idea to have it revised. As with married spouses, if you do not provide adequately for a common-law spouse, he or she has a right to challenge the Will in court.
What about if you die without a Will? The law refers to this as an “intestacy” or that you have “died intestate”. If you die intestate, there are distribution rules that dictate who gets your estate and how much, depending on your circumstances. There are various scenarios that can result and these will apply regardless of whether you are survived by a married spouse or a common-law spouse. As such, being in a common-law relationship can make a world of difference in what happens to your estate. In general, these scenarios are as follows:
- If you do not have any children, then everything goes to your spouse;
- If you and your spouse have any children together and you don’t have any children from other relationships, then your spouse gets the household furnishings and $300,000. If anything is left after this, your spouse will also receive half of what remains while the other half is divided equally among your children; or
- If you have any children from a former relationship, then your current spouse gets the household furnishings and $150,000. If anything is left after this, your spouse receives half of what remains while the other half is divided equally among your children (whether from your current relationship or not).
So what if your estate assets do not exceed $150,000 or $300,000? In that case, your spouse’s share takes priority. If there isn’t enough to cover your spouse’s share, then there will be nothing for your children.
In light of the above, you should be cautious if you are a married or a common-law spouse who has not executed a Will. If the above scenario that applies to you is not what you intend, it’s recommend that you execute a Will as soon as possible.
What happens if you and your spouse break up?
If you have left anything in your Will to your spouse while they were a spouse, but the relationship ends before your death, then your spouse will receive nothing under the Will. Again, this applies whether you are a married spouse or common-law spouse.
With regard to married spouses, mere separation (as opposed to a divorce) will disentitle your spouse from receiving anything under your Will. As for common-law spouses, it is simply when the relationship has ended (i.e., either of you tells the other, “it’s over”). Likewise, if you do not have a Will and die intestate, a married or common-law spouse will receive nothing under intestacy rules if the relationship has ended before your death.
Given that marriage, cohabitation, and break-ups can have a lot to do with your estate and how it gets distributed, a review of your estate plan with a legal advisor is advised whenever one of these events has taken place. This will ensure that your estate planning documents are revised and updated as necessary. If you have not done any estate planning yet, it’s always a good idea to have a preliminary discussion with a legal advisor to consider whether this is necessary in your circumstances.
For more information on Estate Planning refer to the following resources:
- Powers of Attorney and Representation Agreements
- Wills, Trust and Estate Planning
- Probate, Trust and Estate Planning
- Charitable Planning
- Wills Variation Claims
- Seniors and Financial Abuse
- Estate Litigation and Disputes
- Disability and Dependents Planning
For more information on Family Law issues, refer to the following resources:
- Alternative Dispute Resolution
- Division of Assets
- Child and Spousal Support
- Child Protection Issues and MCFD
- Custody and Guardianship
- Mobility Disputes
- Pre-nuptial and Cohabitation Agreements
- Tax Implications Upon Marriage Breakdown
- Valuing and Protecting Business Interests
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