Changes to Estate Law in Alberta

By Gary Kirk of Kirk Montoute Dawson LLP posted in Estate Law on Friday, August 2, 2013.

In February, 2012, the Alberta government proclaimed the Wills and Succession Act. This legislation replaced a patchwork of previous legislation. It also made significant changes to well established practices in the area of Estate law and Matrimonial law. Anyone who is now separated or anticipates becoming separated (whether in a married or a “common-law” relationship) should seek advice about the impact of the Wills and Succession Act.

Let’s look at a positive change in Estate law. Previously a will executed prior to marriage was voided upon marriage; however, divorce (or separation in the case of common-law partners) did not void an existing will. Where a party did not execute a new will after divorce or separation, former spouses was named as Executor or a beneficiary would receive a windfall inheritance. Under the Wills and Succession Act, any former spouse named as an Executor or beneficiary in the will of their now divorced (or separated common-law spouse) is deemed to have pre-deceased that spouse, precluding them from acting as Executor or receiving a benefit.

In the case of parties who are separated but not divorced it is crucially important that a new will be executed to avoid the “gap” between separation and divorce during which a benefit may accrue to the separated spouse.

Section 117 of the Wills and Succession Act has not been well received by Estate and Family law practitioners. Under the new legislation, a surviving spouse is presumed to have a claim to 50% share of matrimonial property in addition to benefit received in the deceased spouse’s will as well as any property, insurance proceeds, etc., flowing to the surviving spouse outside of the will. This section is potentially disruptive to many carefully considered estate plans, particularly in the case of second or third marriage and blended families, where provision for the other spouse is made outside the will. Protests from the Estate and Family law bar led the government to suspend s. 117 pending further consultation. It is expected this provision will remain in the Wills and Succession Act in similar form but with an “opt in or opt out” clause.

It is important that one have a current will – even more important if one has separated but not yet divorced. Contact Kirk Montoute Dawson LLP to create an estate plan and will that preserves your assets for intended beneficiaries.