Eight Drafting Tips for Primary and Secondary Wills
At the recent Six-Minute Estates Lawyer, several areas of interest were discussed. One that served as a helpful reminder to me was the presentation on the estate administration tax-avoidance strategy of using primary and secondary wills. Many tips are contained in the paper presented by Kathleen Robichaud. Here are eight of them:
- Checklist – develop a thorough intake process and form, so you can ensure a detailed meeting with your client takes place that will give you the information needed to make recommendations best suited to your client’s needs;
- Revocation clause – ensure each will has one that takes the other will into account, so each will won’t revoke the other;
- Estate trustee – using the same estate trustee (and same alternate) for both wills may reduce the risk of drafting errors and usually simplifies the administration (although for a second will regarding outside Ontario assets, it is ideal to have the estate trustee and assets both in the same jurisdiction);
- Debts and Taxes – it is of particular importance to delineate how debts are to be paid in both wills, especially if you have difference beneficiaries and/or estate trustees in each of the wills;
- Know which assets require probate – sounds trite, but when in doubt only include assets in the secondary will that you are certain do not require probate (e.g. real property (subject to exceptions), bank accounts with large balances, RRSPs left to the estate, shares of publicly traded companies, an interest in a privately held partnership and investment accounts generally require probate);
- Define the assets carefully – otherwise you may have a partial intestacy that could defeat the testator’s wishes;
- Out of jurisdiction assets – when dealing with out of jurisdiction assets, consider that a second, third or even fourth will may be appropriate for varying reasons (e.g. because of difference succession rules or difference taxation rules); and
- Beneficiaries – listing the correct beneficiaries for the right assets, and matching the right set of beneficiaries with the corresponding will, can avoid drafting errors that may otherwise result in both wills having to be probated and/or rectification orders being needed.
Thanks for reading and enjoy the long weekend!
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