Author: Nick Esterbauer

26 Jan

Technology and Aging in Place During COVID-19

Nick Esterbauer Elder Law, In the News Tags: , , , , 1 Comment

Technology is often considered as a tool more common among younger generations, with older individuals less likely to have embraced the internet and smartphones that, for many of us, have become important parts of our lives.

As lawyers know, the court system and legal profession have embraced technology in a number of new ways over the past year.  From Zoom hearings to probate applications filed by email, we have had to adapt to better use technology in the practice of law.  Recent news articles also suggest that the pandemic appears to be increasing the use of technology among older adults.  In particular, the last ten months are noted to have seen:

  • Acceptance of applications typically used primarily by millennials seeking convenience by other groups;
  • For many, home delivery has become a “necessity”;
  • Video chat has become a “lifeline for older adults”, who may otherwise be totally isolated;
  • Increased accessibility to telemedicine and virtual caregiving support; and
  • Online education for individuals of all ages, whether geared to enhance career potential or otherwise.

Many of these trends have the potential to assist seniors in aging in place during the COVID-19 pandemic, which no doubt has become an increasingly attractive option in light of the tragic situation at many long-term care facilities.  Increased technology use by seniors is noted to be a positive that has emerged as a result of COVID to make independent living more comfortable and safer.  There are also a number of online resources available with recommendations for seniors wishing to safely age in place, including this review of possible Home Modifications available through Family Assets, a resource for senior care.

It will be interesting to see how our use of technology continues to evolve to assist individuals at all stages of life during the pandemic and beyond.

Thank you for reading.

Nick Esterbauer

25 Jan

Medication and Mental Capacity

Nick Esterbauer Capacity, Estate & Trust, Health / Medical Tags: , , , , 0 Comments

As estates practitioners know well, the medication that an individual takes could reflect underlying conditions that affect mental capacity.  High doses of pain medications or other medication prescribed to treat serious physical ailments may also impact a person’s cognition.

A recent article on Considerable highlights the impact that certain common medications may have on mental capacity.  An estimated 25% of seniors take “anticholinergic” drugs to treat a variety of common issues, including allergies, insomnia, and asthma.  These medications are known to target acetylcholine, a chemical messenger that plays an important role in concentration, cognition, and memory.  Some drugs (including over-the-counter medications as well as those for which a prescription is required) impact acetylcholine levels more than others and, when they are taken together, can have a cumulative effect.  As a result, high doses of anticholinergic drugs, which are often believed to have only inconsequential side effects, can interfere with brain messaging and result in symptoms consistent with dementia.

The article refers to a patient whose score on a Mini-Mental Status Examination increasing from 11 to 28 out of 30 after a readjustment of her medication, which included common antihistamines and medication for mood and gastrointestinal issues.  Further research is being conducted on the short-term and long-term effects of anticholinergic use, as there is concern that prolonged use may cause irreversible cognitive decline.

As our readers know, due to the nature of capacity standards and importance of reviewing capacity on a case-by-case basis at the time of the relevant decision or instructions, it may be worthwhile to consider whether medication, even that commonly prescribed to seniors, may be a contributing factor.

Thank you for reading.

Nick Esterbauer

 

Other blog entries that may be of interest:

29 Oct

Continued Inaccessibility of Digital Assets

Nick Esterbauer Estate & Trust, In the News Tags: , , , , , , , , 0 Comments

We have previously blogged extensively on the issue of inaccessibility of digital assets and the absence of legislation in Canadian provinces, including Ontario, to clarify the rights of a fiduciary to access and administer digital assets on behalf of a deceased or incapable rights holder.

While the Substitute Decisions Act, 1992, and Estates Administration Act provide that attorneys or guardians of properties and estate trustees, respectively, are authorized to manage the property of an incapable person or an estate, Ontario does not currently have any legislation that clarifies these rights by explicit reference to digital assets.  While continuing powers of attorney for property and wills can be crafted to explicitly refer to digital assets and the authority of an attorney for property or estate trustee to access accounts and information in the same manner in which the user him or herself was able, access issues can still arise during incapacity or after death.

A recent CBC article highlights the inadequacy of legislation facilitating access to digital assets.  A surviving wife of over forty years was the estate trustee and sole residuary beneficiary of her late husband’s estate.  In seeking access to an Apple account that she shared with her husband, she was told that she would require a court order, even after providing Apple with a copy of her husband’s death certificate and will.  Apple cited the United States’ Electronic Communications Privacy Act, which predates the prominence of computers and the internet in our daily lives, as prohibiting them from distributing personal electronic information.  Four years after her husband’s death in 2016, the Ontario woman is now obtaining pro bono assistance in seeking a court order granting access to the shared account in the absence of any other options.

It is anticipated that the adoption of the Uniform Law Conference of Canada’s Uniform Access to Digital Assets by Fiduciaries Act would resolve some or all of the issues currently faced by Ontario residents in accessing and administering digital assets.  However, now over four years since its release, only Saskatchewan has implemented provincial legislation mirroring the language of the uniform act.

It will be interesting to see in coming years whether legislative updates will address continued barriers to the access and administration of digital assets and the corresponding access to justice issue.

Thank you for reading,

Nick Esterbauer

 

Other blog entries that may be of interest:

27 Oct

Separation, Divorce, and COVID-19: Don’t forget to update your estate plan

Nick Esterbauer Estate & Trust, Estate Planning, In the News, Wills Tags: , , , , , , 0 Comments

Recent reports suggest that divorce and separation rates are on the rise during the pandemic (with rates of separation cited as having increased as much as 20% to 57% from last year, depending on the jurisdiction).  This has been in part attributed to the stresses of lockdown and worsening financial situations.

Many Canadians may not be fully aware of the legal impact that separation and divorce have upon an estate plan, mistakenly believing that there is no real difference between marriage and a common-law partnership.  However, the distinction in Ontario remains important from an estate planning perspective – for example:

  • A common-law or divorced spouse does not have any automatic rights upon the death of a spouse who does not leave a will, whereas married spouses take a preferential share and additional percentage of a predeceasing married spouse’s estate on an intestacy;
  • A married spouse has the right to elect for an equalization of net family property pursuant to the Family Law Act on death, whereas common-law spouses have no equalization rights on death;
  • Marriage automatically revokes a will (unless executed in contemplation of the marriage), whereas entering into a common-law relationship has no such impact; and
  • Separation (in the absence of a Separation Agreement dealing with such issues) does not revoke a will or any gifts made to a separated spouse, whereas gifts under a will to a divorced spouse are typically revoked and the divorced spouse treated as having predeceased the testator.

While top of mind for estate lawyers, lawyers practising in other areas of law and their clients may not necessarily turn their minds to the implications that separation and divorce may have on an estate plan, particularly soon after separation and prior to a formal divorce.  With the potential for family law proceedings to be delayed while courts may not yet be operating at full capacity, combined with elevated mortality rates among certain parts of the population during the pandemic, it may be especially worthwhile in the current circumstances to remind our clients of the importance of updating an estate plan following any material change in family circumstances, including a separation or divorce.

Thank you for reading and stay safe,

Nick Esterbauer

26 Oct

Witnessing Requirements for Powers of Attorney

Nick Esterbauer Capacity, Elder Law, Power of Attorney Tags: , , , , , , 0 Comments

In Ontario, a Continuing Power of Attorney for Property or a Power of Attorney for Personal Care must be signed by two witnesses.  As our readers also know, as a result of COVID-19, witnessing and execution requirements for Powers of Attorney in Ontario have been relaxed to facilitate access to incapacity planning during the pandemic.  These provisions have recently been extended to November 21, 2020.  Provided that one witness to a Continuing Power of Attorney for Property or Power of Attorney for Personal Care is a licensee under Ontario’s Law Society Act, the document may be witnessed using audiovisual communication technology and signed in counterpart.  The document does not otherwise need to be witnessed by a lawyer (although, where a lawyer has assisted in the preparation of Powers of Attorney, it will often be most practical for the lawyer and one of his or her staff to witness the client’s execution of the document).

Especially in light of social distancing measures, it is important to keep in mind the restrictions on who can witness incapacity planning documents.  In Ontario, neither a Continuing Power of Attorney for Property nor a Power of Attorney for Personal Care can be witnessed by:

  • the attorney or the attorney’s spouse;
  • the grantor’s spouse;
  • a child of the grantor;
  • a person whose property/personal care is under guardianship; or
  • an individual of less than eighteen years old.

If the lawyer him or herself is being appointed under the document, which is not an uncommon practice, the involvement of a second lawyer or a paralegal in the virtual execution and witnessing of the document(s) may be necessary.

In the Yukon, the witnessing requirements for Powers of Attorney are somewhat different.  As it currently stands, in order for a Continuing Power of Attorney for Property (there referred to as an Enduring Power of Attorney) to be effective, a Certificate of Legal Advice must be provided by a lawyer.  As a result, the lawyer typically witnesses the Power of Attorney, which is not otherwise valid.   While only one witness is required, the lawyer providing the Certificate cannot be the attorney or the attorney’s spouse.

A recent article from Canadian Lawyer reviews proposed changes to Yukon’s Enduring Power of Attorney Act.  One of the key amendments is the replacement of the requirement that a lawyer be involved in witnessing the execution of Continuing Powers of Attorney for Property with the option of the witnessing of such documents by two other individuals.  Similar to the requirements in Ontario, a witness must be an adult and cannot be the spouse of the donor, the attorney, or the spouse of the attorney.

If approved, the recent Yukon Bill will eliminate the necessity that a lawyer be involved in the witnessing of Powers of Attorney to increase access to incapacity planning throughout the territory.

Thank you for reading.

Nick Esterbauer

30 Jul

Interpretation of Settlement Agreements

Nick Esterbauer Estate Litigation, Litigation, Mediators, Wills Tags: , , , , , , 0 Comments

A recent decision of the Alberta Court of Queen’s Bench highlights the importance of carefully reviewing settlement agreements prior to their execution.

In Anderson Estate (Re), 2020 ABQB 428, the Alberta Court of Queen’s Bench revisited a settlement that had been negotiated during a judicial mediation.

Mr. Anderson had left a Last Will and Testament executed roughly one month prior to his death that directed that the residue of his estate be distributed to his three children, who were the parties to the litigation.  The Will addressed certain advances made to his children during his lifetime, the disposition of real property, and declared the testator’s intent that the parties be treated equally.

One son, who later brought the motion with respect to the interpretation of the agreement, had previously disclaimed real property gifted to him under the Will because the value assigned to the property in the Will itself was significantly higher than the appraised value of the property (with a discrepancy of $2 million), such that he would take a correspondingly lower distribution from the residue of the estate to reflect his acceptance of the gifted property.  The judicial mediation process had been initiated with the intention of resolving interpretation issues in respect of the Will arising from the son’s disclaimer of the property.  The terms of the Will and the settlement agreement were not straightforward, but the settlement provided in part that the son would receive at a value of $4 million a different property than that bequeathed to him under the Will that he had disclaimed.

Pursuant to the terms of the settlement agreement, the matter returned to the case management judge for the determination of its proper interpretation.  The son sought an interpretation of the agreement that provided that he had substituted his receipt of one property for the other at a notional cost corresponding to advances tied to the first property.

Justice Jones reviewed the law in general relating to ambiguities appearing in contracts, such as the settlement agreement that the parties had executed (at paragraphs 35 through 40, briefly summarized below):

  • true legal ambiguity arises where a phrase is reasonably susceptible on its face to more than one meaning;
  • courts can consider surrounding circumstances that include everything that affected the language of the document from the perspective of a reasonable person;
  • extrinsic evidence, however, is intended to serve “as an objective interpretative aid to determine the meaning of the words the parties used”, with limitations set out by the Alberta Court of Appeal in Hole v Hole, 2016 ABCA 34;
  • the goal of the courts is to give effect to the objective intentions of the parties, rather than to “second-guess the contract”;
  • even in the absence of ambiguity, a judge is to consider relevant surrounding circumstances in interpreting the contract.

The judge found that the settlement agreement was not susceptible to more than one meaning, stating as follows (at para 84):

A retrospective determination that one entered into an agreement on terms less commercially favourable that one now thinks should have prevailed does not evidence ambiguity.

This decision may serve as a reminder to take care in ensuring that the meaning of a settlement agreement is properly understood by all parties and clearly set out without room for ambiguity.  Remaining silent on certain points that should properly be addressed during the dispute resolution process may limit the rights of the parties to pursue them, even where the settlement agreement will otherwise lead to the distribution of an estate that may be perceived as unfair.

Thank you for reading.

Nick Esterbauer

28 Jul

Life Insurance During COVID-19

Nick Esterbauer Beneficiary Designations, Elder Law Insurance Issues, Estate & Trust, Estate Planning, Health / Medical, In the News, RRSPs/Insurance Policies Tags: , , , , 0 Comments

Life insurance can be an important part of an estate plan, be it taken out to fund payment of anticipated tax liabilities triggered by death, to assist in supporting surviving family members, or to equalize the distribution of an estate within the context of the gift of an asset of significant value (such as a family business) to one child to the exclusion of another, who can be designated as beneficiary of the policy.

In a time when many Canadians are facing their mortality and taking the pause from normal life as an opportunity to review and update estate plans, many Canadians are turning their minds to other aspects of estate planning, including supplementing an estate plan with life insurance.  A recent Financial Post article suggests that life insurance applications have doubled during the pandemic, as more Canadians take steps to plan for the unexpected during this period of uncertainty.

At the same time, premiums for new permanent life insurance policies have increased by as much as 27%.  While term life insurance policies may remain a more affordable option, they too are anticipated to become more expensive, with upcoming premium increases of up to 20%.  The increase in premiums has been linked to lowering interest rates and restrictions to the investment options available to insurance companies.

Other changes to life insurance during the pandemic include the exclusion of the standard medical examination required in order to obtain some types of coverage.  The maximum coverage offered by many providers without a medical exam has increased to reflect limitations to the ability for applicants to safely attend an in-person examinations.  For other providers and types of plans, medical examinations are simply on hold.

Lastly, insurance companies have updated intake questionnaires to include COVID-screening questions.  If an applicant is experiencing potential symptoms, they may be required to wait two weeks before taking out the policy, but are not typically ineligible from coverage altogether.  Some insurers, however, are no longer offering new coverage to seniors or others who are at a higher risk of complications during the period of the pandemic.

One life insurance provider has already doubled its projected COVID-19-related payouts during 2020 from the figures it had released earlier this year.  While there may have been changes to certain eligibility requirements and the cost of life insurance, it remains a suitable estate planning tool for many Canadians.

Thank you for reading,

Nick Esterbauer

 

Other blog posts that you may enjoy reading:

27 Jul

Potential Inheritance Tax Implications of Quarantine

Nick Esterbauer Elder Law, Estate & Trust, General Interest, In the News Tags: , , , , , 1 Comment

Many parts of the world remain under some degree of lockdown due to the COVID-19 pandemic.  For older adults who may have limited access to assistance or company outside of immediate family during the pandemic, and/or whose transition to long-term care may have been delayed as a result, temporary relocation to live with supportive family members may be a suitable option.

As our readers know, inheritance tax is payable in respect of the assets of estates located in a number of jurisdictions, which do not include Canada.  In the United Kingdom, for example, an inheritance tax of 40% is charged on the portion of an estate exceeding a tax-free threshold of 325 thousand pounds (subject to certain exceptions).

One way that some families choose to limit inheritance tax is to gift certain assets, in some cases a family house, prior to death, such that its value will not trigger the payment of inheritance tax.  In the UK, if an asset is validly gifted at least seven years before death, inheritance tax will not be payable on the asset.  However, where the donor of the gift reserves the benefit of the property – for example, if he or she continues to live at real property gifted to another family member – the gift will not be valid for the purposes of inheritance tax calculations.

A recent news article highlights the risk that older individuals in the UK who move back into previously gifted property during the pandemic may lose the benefit of potential inheritance tax exclusions by falling under the “gift with reservation of benefit” exception as a result of benefitting from continued occupation of the gifted property.  While this risk may not outweigh the benefits of obtaining family support, it is a factor that a family may wish to consider as part of a decision to alter living arrangements.

Approximately 600 gifts have failed in the past several years, triggering up to 300 million pounds in inheritance tax in the UK.  It is certainly possible that these figures will continue to increase as a result of shared family accommodations during the pandemic.

Thank you for reading and stay safe,

Nick Esterbauer

 

Other blog posts that you may enjoy reading:

30 Apr

Incapacity Planning Considerations Specific to COVID-19

Nick Esterbauer Capacity, Elder Law, Power of Attorney Tags: , , , , 0 Comments

Earlier this week, Ian Hull and I spoke at Osgoode Professional Development’s program on Powers of Attorney and Guardianship: Non-Contentious and Contentious Matters.

During the program, in addition to discussing new execution options for wills and powers of attorney, the panel shared its thoughts on a number of considerations relevant to the preparation of powers of attorney during the pandemic, including some of the following:

  • It may now be impractical to permit for decisions regarding personal care or property to be made only jointly by two or more attorneys acting together where the attorneys selected are not members of the same household.
  • In light of ongoing travel restrictions, it may be increasingly important that the selected attorney(s) for property and/or personal care are local.
  • It may be more difficult to access multiple medical professionals (or a specified medical professional) to confirm incapacity during a healthcare crisis.  The provision regarding the circumstances in which a power of attorney is to become effective should accommodate potentially limited access to a specified physician or more medical professionals than necessary.
  • It may be more important than ever to ensure that the original power of attorney documents (and/or copies) are physically accessible to the named attorney(s).
  • The current circumstances present a unique opportunity to assist clients in updating outdated plans and ensuring that powers of attorney are put into place for those who do not have them already.

Even outside of the context of a pandemic, considering practical issues like those set out above when creating or updating an incapacity plan is a worthwhile exercise and may expose potential problems with the plan before it is finalized.

Thank you for reading.

Nick Esterbauer

 

Other blog entries that may be of interest:

28 Apr

Funerals During COVID-19

Nick Esterbauer Funerals, Health / Medical, In the News Tags: , , , , 0 Comments

The COVID-19 pandemic has changed the way in which we live our lives, with strict limitations on social gatherings of any kind, including funerals.  However, deaths obviously continue to occur during this period, with death rates among certain population groups on the rise, and delaying memorials and funerals until after the current health crisis has ended, whenever that may ultimately be, may be impractical and/or prolong the grieving process.

A review of recent news articles suggests that several trends are beginning to emerge in respect of funerals as large in-person gatherings continue to be prohibited throughout Canada and much of the world:

  • Some funerals are being held using video-conferencing software such as Zoom, with enhanced ability for family members living abroad to participate, with some funeral services continuing in-person, with very limited attendance (typically limited to five individuals, including the officiant) and distance of no less than six feet between attendees who are not members of the same household;
  • Communities such as Flatrock, Newfoundland, have seen cars line up along the side of a street to blink their lights as the hearse passes by on its way to the cemetery as a way to show their respect without potential exposure to the virus;
  • In Quebec, because of concerns over transmission, embalming in respect of the remains of a victim of COVID-19 is prohibited, there are restrictions as to the timing for visitations and interment, and funeral-related service providers are relying upon protective equipment (such as N95 masks and gloves) to stay safe while handing remains of COVID-19 victims;
  • Funerals in Calgary and elsewhere are reportedly “going digital”, with funeral home directors citing the increased role of online photo gathering and live-streamed funeral services;
  • Online visitations are gaining popularity (according to funeral workers in Windsor), while some Jewish families are sitting shiva on Zoom.

It will be interesting to see whether any of these trends survive the lessening of restrictions on social gatherings.

Thank you for reading.

Nick Esterbauer

 

Other blog entries that may be of interest:

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