There are many pitfalls to avoid when planning your estate and drafting a Will. In this series of articles, we have highlighted a few of these pitfalls, so that our readers may be better equipped to sidestep them when the time comes to prepare or revise a Will.

If you leave your property to your “new” spouse outright and rely on his/her generosity to leave it in his/her Will to your adult children from your previous marriage, remember that a Will can be changed at any time, and in the span of about ten minutes. What if you pass away and your new now-widowed partner meets somebody new? In that case, the Family Relations Act may result in your assets being split with his/her new partner rather than your adult children….perhaps not your first choice?

Estate Planning and Blended Families

It is very important to have a proper Estate Plan set in place if you have children. It is, however, crucially important to have an Estate Plan in place if you have children and your current spouse is not the parent of your children. Although it is common for spouses to leave their assets first to each other and then to the next generation, such a plan does involve risks. Let’s say you and your current spouse both have children from previous relationships. You may agree with your current spouse for example, that you will leave your assets first to each other, and then, with the death of the last of you to go, distribute these assets evenly between all the adult children you have separately and together. This sounds fair at first glance. However, your current spouse can change their Will at any time. Let’s say you pass away first. Perhaps ten years go by, and your now-widowed spouse meets someone new who also has children from another relationship. We must be realistic about the possibility that your children may end up with little or nothing in such a scenario. Even if your now-widowed spouse keeps his/her word, your children’s share may be diluted by their new partner’s desire to have all of his/her assets combined with your now-widowed spouse’s assets and then distributed amongst what the new partner would consider their children, which might not include your children.

Even though you may be certain that your current spouse will show the same generosity to your children as his/her own, your children may feel some anxiety knowing that their step-parent has inherited everything and they must wait for this person’s demise to inherit their share.

This situation intensifies considerably when an older person with adult children begins a relationship with a much younger partner, possibly as young as or younger than the adult children.

Consider the case of Banton v. Banton. In this Ontario case, an 88 year old man who had lost both his first and second wife ended up in a nursing home, where he met a 31 year old waitress. The two struck up a romantic relationship. Up until this point, Mr. Banton had a warm and loving relationship with his five children. Perhaps understandably, the adult children were concerned about this new relationship and took steps to have Mr. Banton’s competency assessed. Shortly thereafter, the young woman married Mr. Banton, and, the day after the wedding, she arranged for him to sign a new Will at her lawyer’s office, leaving his entire estate to her.

Although the courts found this new Will invalid, (due both to Mr. Banton’s delusional suspicions with regard to his children, and also to the undue influence exercised by the third Mrs. Banton) the young waitress nonetheless inherited a sizable portion of Mr. Banton’s estate. The reason was that, without a Will, Mr. Banton died intestate, and as his legal spouse the young woman was entitled to a portion of the estate.

What this case underlines is that the potential legal issues that arise when organizing an estate plan for a blended family encompass not only questions with regard to Wills and estates, but also family law legislation.

Consider the case in Ontario of Stone v. Stone, in which an elderly husband, diagnosed with incurable cancer and told he had a mere three weeks left to live, was determined to leave his assets to his own children and not the new Mrs. Stone’s children from a previous marriage. He gifted to his own children assets with a value of approximately$1,300,000, leaving the new Mrs. Stone with $250,000 and a life interest in the matrimonial home (use of the remainder of her lifetime). In this case, the new wife claimed that she had an interest in the assets gifted to the adult children under family law legislation, and that therefore her husband’s attempt to give those assets away amounted to fraud. She was successful, and the gifts to Mr. Stone’s children were rendered void under fraudulent conveyances legislation. No such case has been argued yet in BC, but a successful challenge could be made here if the circumstances were similar to those in Stone v. Stone.