What is a Disclaimer?
Receiving an inheritance under a will is a gift, and there is no obligation, as a beneficiary, to accept it. It is possible for a beneficiary to waive their right, or “disclaim” their interest, to a gift under a will.
As established in Biderman v Canada, 2000 CanLii 14987 (FCA):
A disclaimer is the act by which a person refuses to accept an estate which has been conveyed or an interest which has been bequeathed to him or her. Such disclaimer can be made at any time before the beneficiary has derived benefits from the assets. It requires no particular form and may even be evidenced by conduct.
Furthermore, Biderman v Canada establishes that “there is no entitlement to an estate until it is opened since a testamentary gift can always be revoked until death. Once made, the disclaimer is retroactive to the date of death of the deceased.”
There is no prescribed form for drafting or implementing a disclaimer of inheritance. Generally, the waiver should be a written agreement, acknowledging the waiver of inheritance (preferably drafted by a lawyer). The disclaiming agreement should be signed by the beneficiary, and witnessed.
It is also important to ensure that the beneficiary waiving their right to inheritance was not improperly or unduly influenced to do.
The disclaimer, once signed, does not need to be filed with the court. It is important that the lawyer who acts for the estate or the estate trustee keeps the waiver.
If an inheritance is disclaimed, the gift will be deemed void and fall into the residue of the estate, which will then be distributed according to the deceased’s will, or pursuant to the intestacy provisions of the Succession Law Reform Act. When disclaiming a gift, the beneficiary does not have any control over who receives their part of the inheritance.
A beneficiary can not disclaim part of a gift; once you disclaim part of your interest in an inheritance, you disclaim all of it. In Re Skinner, 1970 CanLii 360, the Ontario Supreme Court established that “the law is clear that, where there is a single undivided gift, the donee must take the whole or disclaim the whole: he cannot disclaim part.”
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