Dying without a Will: A Guide to Intestacy

Most people assume they have plenty of time to draft a will. But life is unpredictable, and many Albertans pass away before they have the chance to put their wishes on paper. When this happens, it is known as dying “intestate.”

There is a common misconception that if you die without a will, the government automatically seizes your property. While this is rarely the case, the reality is still complicated. Without a will, you lose the ability to choose who inherits your assets or who cares for your minor children. Instead, the province steps in with a rigid set of rules to make those decisions for you.

Understanding how intestate succession works in Alberta is crucial for protecting your family’s future.

The Role of the Wills and Succession Act

In Alberta, the Wills and Succession Act governs what happens to your estate if you die without a valid will. This legislation creates a hierarchy of beneficiaries based on their relationship to you. It prioritizes immediate family—specifically spouses and children—before moving on to more distant relatives.

The rules are strict. The law does not account for the quality of your relationships. It does not matter if you were estranged from a sibling or if you had a close friend you wanted to support. If it isn’t written in a Will, the Act dictates the distribution.

Who Inherits When There is No Will?

The distribution of an intestate estate depends entirely on your family structure at the time of death. Here are the most common scenarios under Alberta law:

1. You have a spouse or adult interdependent partner (but no children)

If you leave behind a spouse or an adult interdependent partner (often referred to as a common-law partner) and have no descendants, your entire estate goes to them.

2. You have a spouse/partner and children (all from that relationship)

If you pass away leaving a spouse and children who are also the children of that spouse, the spouse inherits the entire estate. The law assumes the surviving parent will take care of the children.

3. You have a spouse/partner and children (from a different relationship)

This is where it can get complicated. If you have a “blended family”—meaning you have children from a previous relationship—your spouse does not automatically get everything.

Instead, your spouse or partner is entitled to a “preferential share.” This is currently set at either 50% of the net estate or $150,000, whichever amount is greater. The remainder of the estate is then divided among your children.

4. You have no spouse/partner but have children

If there is no surviving spouse, the estate is divided equally among your children. If a child has predeceased you but left their own children (your grandchildren), those grandchildren typically inherit their parent’s share.

5. You have no spouse and no descendants

If you leave no direct descendants, the Act looks to wider family members in a specific order:

  • Parents
  • Siblings (or their children, if the sibling has passed)
  • Nieces and nephews

Only if no living relatives can be found within the degrees of relationship specified by the Act does the estate potentially escheat (transfer) to the government, specifically to the Crown.

Who Manages the Estate?

When you write a Will, you appoint an Executor—someone you trust to handle your affairs. When you die intestate, no Executor exists.

Someone must apply to the court for a “Grant of Administration” to gain the legal authority to deal with your assets, pay your debts, and distribute the inheritance. The Act sets out priority for who can apply. Typically, a spouse has the first right, followed by adult children.

If no family member is willing or able to take on this role, or if there is a dispute among family members about who should do it, the process can become expensive and delayed. In some cases, the Office of the Public Trustee may need to get involved.

Take Control of Your Legacy

While the Wills and Succession Act provides a safety net, it is a “one-size-fits-all” solution that rarely fits anyone perfectly. Relying on intestate succession can lead to unintended consequences, such as a new partner inheriting assets intended for your children, or a rigid distribution that creates tax burdens for your heirs.

Furthermore, a Will is the only place you can appoint a guardian for your minor children. Without one, the courts will decide who raises them, potentially choosing someone you would not have selected yourself.

Drafting a Will gives you the final say. It ensures your assets go exactly where you want them to and saves your grieving family from the stress of navigating a complex legal administration during a difficult time.

If you have been thinking about a Will, or didn’t think you need one yet, it’s never too early or too late to draft your Will. Contact us today with questions on how to get started. Don’t leave your legacy up for question while you have the power to determine your family’s future.

What You Need to Know Before Being a Power of Attorney

Being asked to serve as someone’s power of attorney is a significant sign of trust. It means a person believes in your judgment and integrity to manage their affairs if they cannot. While it is an honour, the role carries substantial responsibilities and potential challenges. Before you say yes, it’s crucial to understand exactly what you are agreeing to.

What is a Power of Attorney (POA)?

A power of attorney is a legal document that gives one person, known as the “agent”, the authority to act on behalf of another person, the “principal.” This authority can be broad or limited, depending on the type of POA. The agent’s role is to make decisions that reflect the principal’s best interests.

It’s important to note that a POA is only valid while the principal is alive. Once the principal passes away, the agent’s authority ends, and the executor of the will or estate administrator takes over.

Key Types of Power of Attorney

Understanding the different types of POAs is the first step in knowing what might be asked of you.

  • General Power of Attorney: This grants the agent broad authority to make financial and legal decisions for the principal. This can include managing bank accounts, selling property, and filing taxes. A general POA typically terminates if the principal becomes incapacitated.
  • Enduring Power of Attorney: The word “durable” is key here. A durable power of attorney remains in effect even if the principal becomes mentally or physically incapacitated. This is one of the most common types, as it prepares for future health issues, ensuring someone can manage the principal’s affairs without interruption.
  • Special or Limited Power of Attorney: This type limits the agent’s authority to specific situations or a certain timeframe. For example, it might grant you the power to sell a home on the principal’s behalf while they are out of the country.
  • Medical Power of Attorney: Also known as a Personal Directive, this document gives you the authority to make medical decisions for the principal if they are unable to do so. This includes choices about treatments, surgeries, and end-of-life care.

Your Responsibilities as an Agent

Accepting the role of agent means you are taking on a fiduciary duty. This is a legal obligation to act solely in the best interest of the principal. Your responsibilities are significant and demand care, honesty, and diligence.

Financial and Legal Duties

If you are named in a general or Enduring POA, your duties may include:

  • Managing Finances: This involves paying bills, managing bank accounts, and handling investments. You must keep meticulous records of every transaction.
  • Handling Property: You could be responsible for buying, selling, or managing real estate and other assets.
  • Filing Taxes: You may need to ensure the principal’s state and federal taxes are filed and paid on time.
  • Dealing with Benefits: This includes applying for and managing government benefits.

Medical Decision-Making

A Personal Directive requires you to make healthcare choices based on the principal’s known wishes. Your responsibilities could involve:

  • Communicating with Doctors: You will be the primary point of contact for healthcare providers.
  • Making Treatment Decisions: This could range from consenting to routine procedures to making difficult choices about life-sustaining treatment.
  • Following Advance Directives: You must honor any wishes stated in the principal’s living will or other advance directives.

Potential Challenges and Risks to Consider

The role of an agent is not without its difficulties. It’s important to be aware of the potential hurdles you might face.

  • Emotional Strain: Making decisions for a loved one, especially during a health crisis, can be emotionally draining. You may face pressure from family members who disagree with your choices.
  • Time Commitment: Managing someone’s affairs is time-consuming. It can feel like a part-time job, requiring you to balance these duties with your own work and family life.
  • Personal Liability: As a fiduciary, you can be held legally liable if you mismanage funds or fail to act in the principal’s best interest. Even unintentional errors can lead to legal challenges from family members or other interested parties.
  • Family Conflicts: Money and health are sensitive topics. Your decisions may not be popular with all family members, which can create tension and conflict within the family.

Questions to Ask Before You Agree

Before accepting this role, take time for honest self-reflection. Answering these questions can help you make an informed decision.

  1. Do I fully understand what is being asked of me? Make sure the principal clearly explains their expectations and the scope of your authority.
  2. What is my relationship with the principal? A strong, trusting relationship is essential. Are you comfortable having difficult conversations with this person about their finances and health?
  3. Am I organized enough to handle the record-keeping? The duty to keep detailed records of all financial transactions is non-negotiable. If organization is not your strength, this role could be a poor fit.
  4. Do I have the time and emotional capacity for this role? Be realistic about your own life and commitments. Can you add these responsibilities without becoming overwhelmed?
  5. Do other family members support this decision? While not a requirement, knowing that other family members are on board can reduce future conflicts.

Setting Yourself Up for Success

If you decide to accept the role of power of attorney, there are steps you can take to protect yourself and effectively serve the principal.

  • Read the Document Carefully: Do not just sign it. Read every clause of the POA document to understand the scope of your powers and when they become effective.
  • Talk Openly with the Principal: Discuss their values, wishes, and fears. Ask specific questions about how they want their finances managed and what their end-of-life preferences are. The more you know, the better you can represent their interests.
  • Keep Your Finances Separate: Never mix the principal’s assets with your own. Open separate bank accounts for their funds to maintain a clear and transparent record.
  • Seek Professional Advice: Do not hesitate to consult with professionals. A lawyer can help you understand your legal obligations, and a financial advisor can guide you in managing assets. The cost of this advice can often be paid from the principal’s funds.
  • Set Boundaries: Communicate with other family members about your role. Be clear that you are acting on the principal’s wishes. Setting expectations early can help prevent misunderstandings later.

Agreeing to be a power of attorney is a profound commitment. By understanding the responsibilities and preparing for the challenges, you can fulfill this important role with confidence and care, honouring the trust placed in you.

If you’re considering becoming a power of attorney or appointing one, take the time to fully understand the responsibilities and implications. Open conversations and professional advice can make all the difference. For more insights and guidance, explore our other resources on legal and financial planning and reach out to us for a complimentary consultation.

New Year, New Estate Plan: Why Now is the Perfect Time to Evaluate your Estate Planning Needs

The New Year is upon us once again. With it comes the perfect opportunity to re-evaluate certain aspects of our lives. While most of us use this time to set goals and resolutions, many overlook a crucial element – estate planning. Estate planning may not be the most exciting topic, but it is essential. It secures the future of your loved ones and ensuring that you decide how you distribute your assets. In this blog post, we will discuss why the New Year is the perfect time to evaluate your estate planning needs.

Changes in Life Circumstances

One of the primary reasons to review your estate plan is if your circumstances have changed since the last time you made one. Did you get married or divorced? Or, did you have a child or adopt one? Perhaps some recent business decisions may impact your assets. Did you sell or acquire assets? All of these events may impact the way you distribute your estate and so it is imperative to update your estate plan to reflect these changes.

Tax Laws and Estate Planning

Tax laws are always evolving, which may impact your estate plan. Sometimes these changes may have an impact on how much your heirs may receive. An estate planning specialist can give you the best advice about minimizing your tax liability and maximizing the inheritance for your beneficiaries.

The Importance of Updating Your Beneficiaries

One of the simplest yet most important parts of estate planning is naming your beneficiaries. However, it is essential to ensure that your beneficiary designations are up to date. Many people forget to update their beneficiaries even after major life changes have occurred, which may lead to unintentional complications.

Ensuring Your Wishes Are Carried Out

One of the primary benefits of having a proper estate plan is the ability to have more control over what happens to your assets after you pass away. Even if you do not have substantial assets, you may still want to have control over your sentimental possessions. By putting a proper estate plan in place, you will ensure that your executor can carry out your wishes.

Protecting Your Family’s Interests

Estate planning is not only about you, it is also about your family. A proper estate plan will ensure that you protect your family’s interests and can outline them clearly. It can protect them from potential legal battles, the probate process, and provide peace of mind during a difficult time. A comprehensive estate plan can give your family the tools they need to move on from your passing with ease.

The New Year provides an excellent opportunity to evaluate your estate planning needs. Regardless of age, income, or family structure, estate planning is essential for protecting your family’s interests and ensuring your wishes are carried out. By reviewing your estate plan and updating it as necessary, you are giving yourself and your family peace of mind and security. Contact us to see how we can help ensure that you manage your assets according to your wishes and your legacy lives on as you desire.

Essential Elements to Include in Your Estate Plan

Death is an inevitable part of life, and we don’t like to think about it much. However, it is essential to think ahead and plan for the future, especially by preparing an estate plan. It’s a critical document that ensures your last wishes are met and helps to prevent chaos and confusion among your loved ones after your passing. An estate plan will divide your property and assets, designate guardians for your minor children, and even help with tax planning. In this article, we’ll discuss the essential elements that must be included in your estate plan.

A Will:

A will is a legal document that specifies how your assets and property should be distributed after your death. If you don’t have a will, the court will decide who gets what, which may not be in accordance with your wishes. Your will must specify the distribution of your assets, the person responsible for executing your will, and the amount of inheritance for each beneficiary.

Enduring Power of Attorney and Personal Directive:

An enduring power of attorney and personal directive designates a person to manage your finances and healthcare decisions if you become incapacitated and cannot make decisions for yourself. An enduring power of attorney will allow your designated representative to access your accounts, pay bills, and make financial decisions on your behalf. A personal directive will allow your representative to make medical decisions for you if you are not able to.

 

Guardianship:

Designating a guardian for your minor children is another crucial element of estate planning. If you have minor children and both parents pass away without naming a guardian, the court will appoint someone. This may be a different person altogether, so it’s essential to ensure that your wishes are met. You’ll want to consider factors such as age, location, and values when choosing a guardian.

 

Beneficiary Designations:

Life insurance policies, registered investments, and other accounts require beneficiaries, and these designations must be updated regularly. Make sure you list primary and alternate beneficiaries, and check with your retirement account custodian to ensure your designations are updated and accurate.

 

Digital Estate Plan:

As our lives become increasingly digitized, it’s critical to include a digital estate plan that covers things like social media profiles, online banking, and other online accounts. You may want to consider designating a separate executor for your digital assets, leaving instructions for how to access and handle these accounts.

 

When it comes to estate planning, everyone’s circumstances are unique, so it’s essential to talk to a lawyer or estate planning professional who can help you create an estate plan that meets your specific needs. While drafting an estate plan may seem overwhelming, it’s an essential step to take that can provide peace of mind for you and your loved ones. By following the steps discussed in the article, you can create a comprehensive estate plan that helps to ensure your last wishes are met.

Reach out to us today and let Summit Legal Group guide you in the estate planning process. 

AUTHOR

Craig Gorham is a Certified Executor Advisor at Summit Legal Group, guiding clients through the Estate Administration process with compassion, empathy and a wealth of specialized knowledge. Craig can be reached directly at 587-393-2069 or craig@summitlegalgroup.ca.

Summit Legal Group wins the 2024 Top Choice Award for Wills and Estates Law Firm!

UPDATE (January 11, 2024)

We are pleased to announce that Summit Legal Group WON the 2024 TOP CHOICE AWARD for WILLS & ESTATES LAW FIRM!

Check out all the 2024 Winners here.

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Summit Legal Group is pleased to announce that once again, we have been selected by the prestigious Top Choice Awards as a nominee for the “Top Choice Wills & Estates Law Firm” of 2024!

This nomination is a testament to all the hard work and dedication of our team, providing high-quality legal services in wills and estates. Each of our lawyers and our Certified Executor Advisor are committed to providing our clients with top-notch legal expertise and advice. Our lively and engaging staff are passionate about helping clients navigate estate planning, trusts, and other services related to wills. With our experienced team behind us, we feel confident that we can achieve this great honour!

We invite you to join us in celebrating this incredible opportunity by casting your vote today to help make us YOUR TOP CHOICE!

VOTE HERE: https://topchoiceawards.com/vote?survey_id=V0uE4zGn

But wait, there’s more! By simply voting, you automatically enter a draw with a chance to win one of four incredible $500 cash prizes generously offered by Top Choice Awards!

Stay tuned for further updates and exciting developments on our journey to victory!

Fast Track Grant Approval

Grant application approval

In our recent bLAWg post, we shed light on the typical time frame for a Grant of Probate or Administration approval. However, you may find yourself in a situation that calls for a quicker turnaround. Here’s how you can help expedite the process to fast track the grant approval:

  1. Enlist the right expertise: Choosing an experienced firm is key. Interpretations of the Wills and Succession Act (Alberta) and Surrogate Rules (Alberta) are ever-evolving, even if the regulations themselves don’t change. Outdated techniques may not be applicable today. At Summit Legal Group, we stay abreast of these changes and are consistently in touch with the Surrogate section of the Court to ensure our applications align with the current expectations.
  2. Full disclosure is the best approach: Before we start, we circulate a comprehensive questionnaire to the proposed executor. This information gathering is crucial as minor mistakes can lead the court to reject it. Simple errors such as misspelled names or incorrect addresses can cause delays. The application is sent back to us for revisions before we can resubmit the application to the court. Plus, we can only guide you based on the information you provide. Therefore being as thorough as possible in your responses allows us to assist you better.
  3. Ensure you have a valid will: Make sure you and your loved ones have valid wills. As we’ve highlighted before, grants eligible for electronic submission can often be approved in a matter of weeks, instead of months.

Don’t let the process of obtaining a grant slow you down. Reach out to Summit Legal Group’s team of skilled Estate professionals today for efficient and cost-effective Estate solutions. Let us help you navigate this journey with speed and precision with the hopes to fast track the grant approval process.

Craig Gorham
Certified Executor Advisor

AUTHOR

Craig Gorham is a Certified Executor Advisor at Summit Legal Group, guiding clients through the Estate Administration process with compassion, empathy and a wealth of specialized knowledge. You can reach Craig directly at 587-393-2069 or craig@summitlegalgroup.ca.