Estate planning clients are often under the misunderstanding that they have the ability to choose a permanent custodian or guardian for their minor children under a Last Will and Testament. However, while parents in Ontario can appoint someone in their wills to assume custody of their minor children upon death, the ultimate determination of custody is reserved for the court. It is important for estate planning lawyers to understand and explain to clients how these testamentary custodial appointments work.
It should also be noted that there is an important distinction between guardianship in terms of custody in relation to children (a form of guardianship of the person) and guardianship of a minor’s property. Where there are two parents with custody of a minor child and one parent dies, the surviving parent will automatically have the legal right to custody of the child. In contrast, a guardian of property refers to the individual appointed to manage a minor child’s assets until he or she reaches the age of majority. Parents do not have the automatic legal right to take guardianship of a child’s assets; rather, they must make a formal application to the court to obtain this authority. Most frequently, appointing a guardian for a minor child in a will refers to naming a custodian suitable to take the parent’s place rather than a guardian of property.
The Children’s Law Reform Act (the “CLRA”) provides parents the right to use a will to appoint someone to assume custody of minor children when they die. If two or more people are entitled to custody of the child and death occurs simultaneously, subsections 61(4)(b) and 61(5) of the CLRA provide that the appointment will only be effective if both parents appointed the same person as custodian. In the event that one parent predeceases the other, the appointment of the first parent to die is typically ineffective. In other words, the appointment under the will of the surviving parent prevails. The designated custodian(s) should also be consulted to ensure that they are comfortable with the proposed appointment when the will is prepared.
Upon the date of death, the parents’ decision with respect to testamentary custody is typically effective for 90 days. A formal application to the court must be made during the 90-day period in order to obtain permanent custody of the child, on notice to the Office of the Children’s Lawyer.
It is not uncommon for family members to dispute the custodian appointment and file a competing application for permanent custody of a child after his or her parents’ deaths. While a testator’s wishes with respect to custody are considered by the court – along with the child’s preference if they are of age to express them – the best interests of the child will always prevail. Courts may be reluctant to ignore the wishes of the parents as expressed in their wills unless evidence is brought forward to demonstrate that the appointed custodian would not be fit for the role and thus it would not be in the child’s best interests.
Section 24 of the CLRA sets out guidelines to determine the best interests of the child, stating that courts “shall give primary consideration to the child’s physical, emotional and psychological safety, security and well-being.” A more extensive list of factors to consider follows this initial preface, including “the child’s needs, given the child’s age and stage of development, such as the child’s need for stability” and “the ability and willingness of each person in respect of whom the order would apply to care for and meet the needs of the child.”
Particularly because of the temporary nature of testamentary custodial appointments, it is important to support one’s decision with a clear rationale. In addition to leaving clear instructions in a will or codicil, estate planning clients may wish to take steps to ensure that family members are aware of their testamentary custody wishes and that any disagreements are brought to light while the parents are able to explain their rationale for custody-related wishes. This may facilitate a transition in custody following the simultaneous death of the parents, for the benefit of the children and their new custodians.
It is also worth noting that, as of March 1, 2021 (and scheduled to be incorporated into the legislation later this month), the term “custody” was changed to “decision-making responsibility” under the Divorce Act. According to information from the Department of Justice, “the Divorce Act now features concepts and words that focus on relationships with children, such as parenting time, decision-making responsibility and contact. The term ‘parenting order’ replaces ‘custody order’ throughout the Act, for instance. Similarly, the term ‘contact order’ describes an order that sets out time for children to spend with important people who are not in a parental role, such as grandparents.”
Although it is unpleasant to consider the prospect of an untimely death which would result in a minor child being left behind, it is important that this scenario, however unlikely, is not only considered but adequately planned for when creating or amending an estate plan where minor children are involved.
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Suzana Popovic-Montag and Tori Joseph
I am not sure why, but whenever I talk to my friends about the benefits of having a Will, they seem to dismiss the advice, thinking that Wills are only meant for old people. I was thus delighted to come across this article which highlights millennial-centric reasons for having a Will, some of which are as follows:
Digital Assets – while many millennials attest to not being flush with cash, many are flush with digital assets. I have previously written about my digital presence, admitting that I have two personal e-mail addresses, four social media accounts, and so many points through reward programs such as Aeroplan, Indigo, Greenhouse Juice – the list goes on and on. These assets carry both a financial and personal value. Millennials preparing a Will should think about how they wish to transfer these assets.
Young Children – if a child is a minor, under the Children’s Law Reform Act, it is possible for a testator to appoint one or more persons to have custody of that child in a Will. It is also possible to set up a trust in the Will to ensure that the child’s inheritance is spent responsibly. I often tell people that in making a Will, do not think of it as being done to benefit oneself (i.e. the testator), but to benefit and help your loved ones. Being able to take care of minor children is a great example of this.
Pets Pets Pets – without engaging in the dog vs cat debate, it is suffice to say that many millennials have pets. In fact, millennials these days are opting for pets over parenthood – just walk through Trinity Belwoods Park on a Saturday afternoon. In Ontario, pets are considered property, and thus require specific estate planning. Some options include leaving a cash legacy to a pet guardian or setting up a trust for a pet guardian, both of which can be accomplished in a Will.
Hoping that my millennial friends now agree that Wills aren’t just for old people!
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The Ontario Court of Appeal recently considered the issue of whether the litigation files of the Office of the Children’s Lawyer are subject to a freedom of information access request in Ontario (Children’s Lawyer) v. Ontario (Information and Privacy Commissioner), 2018 ONCA 599. This appeal arose from a father’s request for the production of the Children’s Lawyers’ records. The Children’s Lawyer acted for the father’s children in the course of a custody and access dispute. Accordingly, a portion of the Children’s Lawyer’s records were privileged.
Justice Bennotto, in writing for a unanimous panel, found that the issue turned on whether the records are “in the custody or under the control” of the Ministry of the Attorney General for Ontario (“MAG“) for the purposes of the Freedom of Information and Protection of Privacy Act, R.S.O. 1990, c. F. 31.
The answer was no.
The Children’s Lawyer’s records are not in the custody or under the control of MAG because she operates separately and distinctly from MAG and,
“ [she] is an independent statutory office holder appointed by Cabinet through the Lieutenant Governor. She derives her independent powers, duties and responsibilities through statute, common law and orders of the court.
 To allow a disgruntled parent to obtain confidential records belonging to the child would undermine the Children’s Lawyer’s promise of confidentiality, inhibit the information she could obtain and sabotage her in the exercise of her duties. This would, in turn, impact proceedings before the court by depriving it of the child’s voice and cause damage to the child who would no longer be meaningfully represented. Finally, disclosure to a parent could cause further trauma and stress to the child, who may have divided loyalties, exposing the child to retribution and making the child the problem in the litigation.”
For those practising in the estates and trusts context, it is important to note that the role of the Children’s Lawyer is different in family law.
In civil matters that implicate a minor’s financial interest in property, the Children’s Lawyer acts as the minor’s litigation guardian and she is represented by the lawyers of her choice. In custody and access disputes, the Children’s Lawyer acts, at the request of the court, as the minor’s lawyer.
Bonus answer: the current Children’s Lawyer is Marian Jacko.
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You are an Estate Trustee of an estate which leaves an interest to a beneficiary who is presently under 18 years of age. Knowing that as the amount in question is in excess of $10,000.00 that it cannot be paid to the child’s parent on their behalf in accordance with section 51(1.1) of the Children’s Law Reform Act, and not wanting to delay the administration of the estate until the child has turned 18 years of age, you begin to inquire about what options may be available to you. The possible solution? Paying the funds into court for the benefit of the minor beneficiary.
Section 36(6) of the Trustee Act provides an Estate Trustee with the authority to pay any funds which they holding on behalf of a minor beneficiary into court for the benefit of the minor beneficiary, providing:
“If a minor or mentally incapable person is entitled to any money, the person by whom the money is payable may pay it into court to the credit of the minor or mentally incapable person.”
Should the Estate Trustee pay any funds into court for the benefit of a minor beneficiary, they are discharged concerning such funds in accordance with 36(6.5) of the Trustee Act, which provides:
“Payment into court in accordance with subsection (6), (6.2) or (6.3), as the case may be, and with subsection (6.4) is a sufficient discharge for the money paid into court.”
While the Estate Trustee is discharged from liability as it relates to the funds which are paid into court, this does not necessarily mean that paying funds into court is a sufficient release for the Estate Trustee concerning the administration of the estate as it relates to the minor beneficiary, as the Estate Trustee may still be required to justify how any amount paid into court was arrived at. If the minor beneficiary is entitled to the payment of an amount which is not fixed (i.e. a percentage of the residue), the Estate Trustee will still need to justify how any amount paid into court was arrived at, likely on an Application to Pass Accounts. Presuming that the beneficiary is still a minor when such an Application to Pass Accounts is commenced, the Application will likely be required to be served on the Office of the Children’s Lawyer on behalf of the minor beneficiary.
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Many young families consider estate planning a task that can wait until their children are older, until they have paid off those pesky student loans from university or more importantly until they have acquired assets with significant value. However, an estate planning consideration that often gets overlooked is who will raise your child if you die while they are a minor.
When thinking about who will raise your child if you die before they reach adulthood it is usually the presumption that the other parent will be there to raise the child. So what happens if both parents simultaneously die in an accident? Or what happens if you are the sole living parent or sole custodian of your minor child (i.e. the other parent lost the right to custody by way of court order)?
Section 61 of the Children’s Law Reform Act (“CLRA”) contemplates these situations and provides:
- (1) A person entitled to custody of a child may appoint by will one or more persons to have custody of the child after the death of the appointor.
The testamentary appointment of a minor child is effective only:
- if the parent making the appointment is the only person entitled to custody of the child on the day before the appointment take effect; or
- if both parents die at the same time or in circumstances that render it uncertain which survived the other.
I am certain it goes without saying that the decision of who you will appoint as your child’s custodian is a decision that must be given considerable thought. However, it is especially important in these circumstances because your testamentary appointment expires 90 days after it take effect. Following the expiration of the appointment your chosen custodian must apply to the Court for a more permanent order of custody. Accordingly, regardless of your testamentary appointment your appointed custodian must be able to satisfy the court that a more permanent custody order is in the best interest of the child.
Although the thought of your child being orphaned while they are a minor is inconceivable for many parents, it may nonetheless be something to give some thought.
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This week on Hull on Estates, Natalia Angelini and Jonathon Kappy discuss issues involving minors and incapables. Specifically, they discuss accepting payment into court for the benefit of individuals under the age of majority as well as various statutes dealing with accepting payment into court.
Please leave a comment or send us an email at email@example.com if you have any questions.
Listen to Variation of Trusts
Craig Vander Zee and Bianca La Neve discuss variation of trusts, with an emphasis on the Variation of Trusts Act and approval of variations of trusts on behalf of minor, unascertained, unborn or contingent beneficiaries. The well-known case of R. v. Irving (1975), 11. O.R. (2d) 42 (H.C.) is discussed.
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Listen to Deductions from Compensation.
This week on Hull on Estates and Succession Planning, Ian and Suzana finish up the discussion on the question of accounting by reviewing deductions from compensation and briefly sum up the procedure of the passing of accounts.
Listen to The Formal Passing of Accounts.
This week on Hull on Estate and Succession Planning, Ian and Suzana talk about the specifics of what happens when you have to go to court to formally pass accounts.
Listen to Applying for Probate
This week on Hull on Estate and Succession Planning, Ian and Suzana talk about the applying for probate. They discuss some of the ways that estate administrators can simplify the process.