Karon C. Bales - The estate talk: dos and don’ts
Whether in the family living room or the lawyer’s office, it’s not easy to broach the subject of wills, powers of attorney and estate issues with older adults, Toronto estate and family lawyer Karon Bales tells AdvocateDaily.com.
But it has to be done and most people feel better once they’ve taken care of it, says Bales, a founding partner with Bales Beall LLP who focuses on family law, wills and estates.
It can be challenging for young lawyers to talk about death and legacies with older clients, especially if clients aren’t comfortable talking about it. In her practice, Bales says she’s often told: “I’ll think about it and get back to you.”
'Mom always loved you best': rebutting the presumption of undue influence - Kristine J. Anderson
As Canada's population ages, more children are assisting in caring for their elderly parents.
It is not unusual for one child to take the lead in caregiving, which can take the form of frequent visits, or even moving in with mom and dad.
If, in this situation, the parent gives their son or daughter a gift of money or an asset before they die to the exclusion of other children, the optics can lend themselves to an allegation that the son or daughter unduly influenced their parent to make the gift. Gifts prior to a person's death are referred to as inter vivos gifts.
Equal shared parenting proposal doesn’t serve children: Richard Diamond
Despite calls for new legislation that establishes equal shared parenting as the default position in custody disputes, Toronto family lawyer Richard Diamond tells Law Times he’s opposed to the proposal.
“It focuses on the rights of the parents, not the rights of the child,” says Diamond, an associate with Bales Beall LLP. “Proponents of this sort of legislative agenda can try to conflate the issues.”
Will expansion become a reality? featuring Karon C. Bales
Karon Bales, managing partner of Bales Beall LLP in Toronto, is supportive of the move to expand the unified courts throughout the province, but she remains skeptical that the federal and provincial governments will actually reach that goal.
“I remember when it first started in Hamilton, we were told to expect a rollout across the province very quickly,” she says.
She also says there are other issues that cause frustration for lawyers and litigants.
Bales to co-chair inaugural Cambridge Family Law Forum
Toronto estate and family lawyer Karon Bales will co-chair the inaugural family law forum at an upcoming Cambridge Forums event.
Bales, a founding partner of the boutique Toronto firm Bales Beall LLP, will also co-lead a session on trusts and family law entitled “ When the Love Dies but the Trust Lives On: Trusts and Relationship Breakdown.”
The event will run from Nov. 19-21 at Langdon Hall in Cambridge, Ont.
Better outcomes for children through mediation by Richard Diamond
Couples in the midst of a bitter breakup may want to think twice before starting litigation as a contentious divorce can have long-term negative impacts on the children, Toronto family lawyer Richard Diamond tells AdvocateDaily.com.
“I have seen how conflict between the parents correlates to stress for the children, which can manifest in many ways: behaviour, socialization problems, depression and the like,” says Diamond, a senior associate with the firm Bales Beall LLP.
Can you set aside a marriage contract when seeking dependant's relief?
The existence of a marriage contract does not, on its own, disqualify someone from making a dependant's relief application under the Succession Law Reform Act (SLRA) for proper support if they have been denied it in their spouse’s will. The existence of the marriage contract is only one of several other factors that the court will consider.Read more here.
Seminar to explore comprehensive estate planning for entrepreneurs
On Oct. 18, Toronto estate and civil litigator Kristine Anderson will share her insights on comprehensive estate planning at a breakfast seminar for entrepreneurs and business professionals.Read more here.
Limitation periods and dependant's relief claims by Alexander Turner
Following the coming into force of Ontario's Limitations Act, 2002, litigants have had a reasonable degree of certainty that, in most cases, there is a two-year limitation period to bring a claim and commence a lawsuit.
However, the Act also carves out several categories of claims with their own unique limitation periods. A claim for dependant's relief, brought by a dependant against an estate, is one such example is one such example.
A claim for dependant's relief under Part V of the Succession Law Reform Act must be made within six months of the Certificate of Appointment (probate) being granted to the estate trustee.
Hot housing market stings divorcing couples featuring Richard Diamond
The hot housing market in parts of Canada has put added stress on couples who are ending a marriage, says Toronto family lawyer Richard Diamond.
“With the market being as high as it is, there is an incentive for separated couples to sell the house quickly to maximize the price in a hot real estate market,” he tells AdvocateDaily.com.
He says the rise in interest rates, implemented to cool housing prices, can likewise create problems.
“When people are separating and one spouse wants to stay in the house, it can be difficult for that person to afford the mortgage payments on their own. It forces many people to sell their homes — even if they don’t want to,” says Diamond, an associate with Bales Beall LLP.
“I’m seeing a great deal of anxiety in recently separated clients who want to resolve the housing issue quickly so they can qualify for a mortgage on their own before interest rates increase,” he says.
Diamond points out that the residence is usually the couple’s most significant asset and it can be heavily leveraged.
“In a stable housing market, if the father moved out, there would be time for the family to adjust before selling.”
Under Ontario law, the matrimonial home is the only asset for which you don’t receive a date-of-marriage deduction in the calculation of the equalization of net family property, Diamond says.
“That’s something people are surprised about when they separate: notwithstanding that they brought this property into the marriage, they must account for its value on the date of separation, but they don’t get to deduct the value on the date of marriage,” he says.
As a comparison, Diamond says the only the growth of an investment account during the marriage is subject to net family property equalization, allowing the party that brought the asset into the marriage to get a credit for its value on the date of marriage.
Another way the state of the housing market can put added pressure on a divorcing couple is that they are sometimes forced to continue to live together, Diamond adds.
“I’m seeing more people who are separated but still residing together while they work out a resolution because it’s not affordable for either one to move out,” he says.
While it can be awkward for the former partners, it can be especially painful if there are children involved and there is conflict in the home, Diamond says.
“It’s easier to move on and to deal with each other amicably if you’re not in the same household,” he says.
One way to avoid conflict over the residence and other assets would be through a premarital agreement, Diamond says.
“I'm seeing more couples entering into prenuptial and cohabitation agreements. If a party wants to protect their interest in a home that they are bringing into the marriage, he or she can suggest an agreement that states that only the appreciation of the home during the marriage is shareable,” he says.
Diamond compares a prenuptial agreement to purchasing insurance.
“People don’t want to bet against their relationship, but it’s a prudent thing to do. It’s like buying home insurance. You don’t expect your house is going to burn down, but if it does, you want the protection.”
Emotionally driven litigation can cost detached children by Kristine J. Anderson
Well-meaning children can find themselves embroiled in costly litigation if they jump to uninformed and emotional conclusions about how their parents' assets are being managed.
That’s the lesson to take from a recent Superior Court decision, which sets out an all too familiar scenario involving the child of an elderly person who does not have much involvement in their parent’s lives but becomes suspicious about the way their assets are being handled by a third party.
The court sets a high bar for the removal of a power of attorney (POA) or for ordering a passing of accounts. Barring clear evidence of mismanagement or fraud, the court will be reluctant to interfere.
The facts of the case are fairly straight forward: The 81-year-old mother ran a motel business, which her only son assisted with over many years. The son and his partner also shared a home with both of his parents, as well as their own child until the pair separated in 2003.
When she was in her late 70s, the mother had a fall, and her husband passed away shortly thereafter. After a period of rehabilitation and a brief stay in a retirement residence, she moved in with her son’s ex-partner and grandson. At the same time, her son stopped participating in the motel business and failed to visit his mother, claiming he was suffering from back problems and grief.
After moving in with her, the mother named her son’s former partner as her POA for Property, jointly with her bookkeeper of 30 years. A year later, her son started the litigation, claiming his mother's assets were being mismanaged, and that the two women acting under the POA should be suspended and ordered to pass their accounts. He also started a related action against them for conversion of property he alleges was his.
Fundamental to any dispute of this nature is whether the grantor of the POA has capacity, especially in cases like these, where there is an allegation that the grantor does not understand that her attorney is mismanaging her affairs. In regard to POAs for property, the following factor into an assessment of whether or not the grantor had capacity:
•Do they understand the value of their property;
•Do they understand any obligation they may have to any dependants;
•Do they understand that they are giving the power to manage their property to someone else and in doing that this person must account to them;
•Do they understand the gravity of so doing and the potential for abuse;
As part of an Order for Directions laying out how the litigation would proceed, the son asked for a capacity assessment to be ordered for his mother.
The court is given the authority to order a capacity assessment under the Substitute Decisions Act, 1992 if there are reasonable grounds to believe the individual is incapable. In so doing, the court will balance the affected party's fundamental rights against the court's obligation to protect vulnerable people. A capacity assessment is seen as a substantial invasion of privacy. It should not be assumed that a capacity assessment will be ordered just because the individual is elderly.
In this case, a capacity assessment had already been done and it was determined the mother had capacity. The mother's counsel had ordered one as a pre-emptive strike against the son's application. The son argued that a second one was required due to various technical and format breaches in the report’s preparation, as well as claiming the original version was out of date and did not cover all the facts raised in the application.
The son relied on specific memory lapses his mother had in regard to financial matters to argue she did not have capacity. The court focused on the evidence of the mother herself, concluding that she had the overall ability to understand her assets and finances, and finding no reasonable grounds to suspect that she was now incapable. As a result, the court refused to order a fresh capacity assessment.
The court also rejected the son’s request for an order that the attorneys pass their accounts to show all of the transactions they had participated in on his mother's behalf.
In reaching this decision, the court relied on the evidence of the mother concerning her thoughts on how her money was being managed and the veracity of her assertion that it was her money to do with as she pleases.
Compelling a passing of accounts in the son’s situation was not automatic. He was not a dependant, a creditor of his mother, or the POA for personal care. He could only compel a passing with leave of the court.
As a passing of accounts is a detailed review of a person's finances which then becomes public when it is filed with the court, the court will only grant leave sparingly when there is evidence of abuse.
The incidences that raised the son’s suspicions were that he felt the business was sold for less than it was worth, the manner in which title to a home where his mother and former partner lived was held, and that other assets were sold off rather than kept (such as paintings and vehicles).
The court was critical of the son's evidence on these alleged suspicious activities, leading to a conclusion that he overstated his suspicions, and that they arose primarily out of a misunderstanding of the reasons behind the decisions being made.
The court further stated: "The fact that [the son] does not agree with the manner in which the Attorneys are conducting [his mother’s] affairs does not mean that they are conducting those affairs improperly."
One should be careful before choosing to engage in litigation of this nature and check their emotions at the door. They must ensure they have done a thorough analysis and balancing of the desire to protect the elderly without inadvertently taking on a patronizing attitude as to their parent's abilities and choices.
Mediation a great option in estates disputes
The number of interested parties in estates matters makes mediation a great option for settling disputes, says Toronto estates litigator Alexander Turner.
Under the Rules of Civil Procedure, mediation is mandatory in contested estates, trusts and substitute decision cases commenced in Superior Courts in Toronto, Ottawa or the County of Essex, but Turner, an associate with Bales Beall LLP, says litigants in all corners of the province could benefit from the process.
“It is something that everyone should be aware of and consider. When you have a family fighting over an estate, there can be a number of claims that need to be sorted out at once. It’s likely that many people are going to get something, it’s just a question of how much,” Turner tells AdvocateDaily.com.
When family, estate law converge by Karon C. Bales
How a life insurance policy impacts an estate depends on a variety of factors, including family circumstances, Toronto estate and family lawyer Karon Bales tells AdvocateDaily.com.
Also playing a significant role is where an individual lives because every province deals with family relationships differently.
“There is an assumption it’s the same everywhere — that if you’ve been living together for a long time you have the same rights as married couples,” says Bales, a founding partner of the boutique Toronto firm Bales Beall LLP. “That’s certainly not so in Ontario or Quebec. It is, however, the case in British Columbia, Manitoba, Saskatchewan.”
Family trust property not always sheltered from spouse in a divorce by Kristine Anderson
Unless careful thought has gone into setting up a family trust, spouses who hold an interest in property through such a trust can not necessarily stop a partner from getting their share following a marriage breakdown, Toronto estate and civil litigator Kristine Anderson tells AdvocateDaily.com.
Anderson, a partner with Bales Beall LLP whose practice covers all aspects of litigation involving wills, estates, and guardianship matters, says people will often use trusts as a mechanism for keeping assets out of probate, transferring assets onto children and grandchildren or to shift tax liabilities.
Costs rulings show how public policy plays out in estate litigation by Alexander Turner
Although in estate litigation, the unsuccessful party is often responsible for the successful side's costs, there is an exception when public policy considerations are engaged — and several recent decisions show how these matters play out, Toronto estates litigator Alexander Turner writes in The Lawyer’s Daily.Read more here.
The weight of words in family law matters by Richard Diamond
Lawyers can help set a more positive tone for splitting couples going through a tough period simply through the language that they use, Toronto family lawyer Richard Diamond tells AdvocateDaily.com.
“In my practice, I favour the terms ‘parenting time’ and ‘parenting schedule’ rather than ‘access’,” says Diamond, an associate with Bales Beall LLP.
Bales offers concierge service to estate, family clients
Last time she checked, Toronto estate and family lawyer Karon Bales was the only Ontario lawyer certified by the Law Society of Upper Canada as a specialist in both family law and wills and estate matters.
Unusual as it is, this combination of practice areas strikes her as a natural fit, Bales, a founding partner of the boutique Toronto firm Bales Beall LLP, tells AdvocateDaily.com.
“It’s a seamless approach,” she says, especially as many concepts of the Family Law Act apply to inheritance and vice versa. “To me, it seems obvious that the two areas are related.”
Appeal court's life insurance decision strengthens support security by Alexander Turner
Family lawyers can breathe easy after an appeal court decision limited when life insurance proceeds can be counted towards the value of an estate, says Toronto estates litigator Alexander Turner.
The deceased in the appeal court case separated from his wife in 2012 and took out a court-ordered life insurance policy that named his ex-wife as beneficiary in order to secure his future child and spousal support obligations.
Turner, an associate at Toronto firm Bales Beall LLP, says this kind of arrangement is employed routinely by family lawyers as a mechanism to protect their clients in case the support payors should die before their obligations are met.
Podcast tackles risks of will exclusions by Kristine Anderson.
Testators who plan to leave a child or spouse out of their will should discuss their intentions with the rest of their family, says Toronto estate and civil litigator Kristine Anderson.
Speaking on the Estate Planning Project podcast, produced by the charity Caregiving Matters, Anderson explained that people have responsibilities to certain members of their family, even after death. And cutting them out of the will could cause upheaval if the aggrieved party chooses to go to court to enforce their rights.
“It is something to think about when you are doing your estate planning: who’s going to be left to deal with these issues when you pass away,” said Anderson a partner with Bales Beall LLP whose practice covers all aspects of litigation involving wills, estates, and guardianship matters.
Ruling shows flexibility in section of Limitations Act by Alexander Turner
One of the first decisions to deal with the issue of limitations periods when it comes to an application brought under the Succession Law Reform Act (SLRA) on behalf of a disabled person shows a willingness by the courts to be flexible in such matters, Toronto estates litigator Alexander Turner tells Law Times.
The Ontario Superior Court decision, reports Law Times, found that a disabled woman’s application against the executor of her deceased common-law spouse’s estate was not statute barred, as a six-month limitations period did not come into effect until after a litigation guardian was appointed.
Hidden issues arising out of second and third marriages and also divorce - Kristine J. Anderson on Caregiving Matters' Podcast
Have you ever thought of what second and third marriages and also divorce can do to an estate plan? These are important life developments that need to be included in estate plans. To help us better understand these issues, Kristine J. Anderson who is a partner with the law firm of Bales Beall LLP, based in Toronto, Ontario speaks to some of the issues surrounding this topic.Read more here.
Ensure beneficiary designations are properly done by Jessica Feldman
When planning your estate, give serious consideration to beneficiary designations, says Toronto trust and estate lawyer Jessica Feldman.
“Properly naming beneficiaries can reduce fees and delays,” says Feldman, a senior associate with Bales Beall LLP.
Beneficiaries can be named on policies and plans such as life insurance, RRSPs, RRIFs (Registered Retirement Income Fund), and TFSAs (Tax-Free Savings Account) and those funds can pass directly to a beneficiary without going through probate.
“For married people, naming a spouse as the beneficiary of an RRSP or an RRIF is the most tax-efficient way to pass on that money,” says Feldman. “The proceeds of the plan are paid directly to that individual. They’re not considered an estate asset, meaning the estate doesn’t pay estate administration taxes on the value of the plan. That’s why designating beneficiaries is very attractive.”
Including children conceived posthumously in SLRA raises questions by Kristine Anderson
Recent legislative changes that include children conceived posthumously in the definition of ‘child,’ — allowing them to claim financial support from the deceased parent’s estate — raise a number of questions, including timing of the distribution of an estate, Toronto estate and civil litigator Kristine Anderson writes in The Lawyer’s Daily.
As Anderson explains, Ontario has expanded the definition of “child” in several pieces of legislation including the provisions of the Succession Law Reform Act (SLRA) that deal with applications for dependant’s relief.
The pitfalls of pre-death transfers to estate beneficiaries by Alexander Turner
In estate administrations, it is not uncommon for beneficiaries to receive substantial amounts of money, or property, from the deceased before death. This is particularly the case when the deceased is the sole surviving parent and there are several children who are beneficiaries.
This can take the form of gifts, loans, or in certain cases, a trust. It is important for the estate trustee to identify and categorize the effect of each of these property transfers when conducting the estate administration. Below, I highlight some common pitfalls with each:
Uncertainty in dependant relief applications by Kristine Anderson
Diligent estate planners should counsel clients on the potential hazards of not properly providing for a spouse or dependents in their estate plans and wills, says Toronto estate and civil litigator Kristine Anderson.
Without adequate planning, the client's estate may become vulnerable to a claim for support by a spouse, dependent child or dependent sibling, and such litigation can be time-consuming, divisive and expensive, she tells AdvocateDaily.com.
The challenge, however, is it’s becoming harder to provide clients with certainty when advising them as to how their previous marriages and obligations might intersect with their current ones, Anderson points out.
Caring for Fido and other family pets in estate plans by Jessica Feldman
Pets are a much-beloved part of many families so it’s not surprising more people are making provisions for them in their estate plans, says Toronto trust and estate lawyer Jessica Feldman.
She tells AdvocateDaily.com that the subject of how pets will be cared for comes up in client conversations about new wills or changes to existing estate plans often these days.
“It’s very common now. I frequently come across individuals who are worried about where their pets will land after their death. People see their animals as members of the family.”
But under Canadian law pets are considered property, and like money or a piece of jewelry, they can’t inherit their owner’s assets, but they can still be provided for in meaningful ways, Feldman says.
Law commission recommends POA education by Alexander Turner
TORONTO - The Law Commission of Ontario is calling for broad changes to systems dealing with powers of attorney in the province
The commission issued a report on Wednesday laying out 58 recommendations aimed at the Ontario government, the province's various professional colleges and even the court system.
Executive Director Nye Thomas says most Ontarians are not clear about their legal obligations when they sign a power of attorney and become a substitute decision-maker for someone who is incapacitated.
He says some of the report's recommendations are calling for greater education on what a power of attorney entails, as well as extra safeguards to make sure they aren't being misused.
Toronto estates litigator Alexander Turner tells AdvocateDaily.com that he welcomes any attempt to increase prospective attorneys' awareness of what they're letting themselves in for.
Finding 'best path forward' a model for client service by Kristine Anderson
Estate litigation is a frightening and novel experience for most people, and lawyers should provide practical advice that’s tailored to individual needs, says Toronto estate and civil litigator Kristine Anderson.Read more here.
Ignorance of misconduct no excuse for co-trustees: OCA by Alexander Turner
A recent Ontario Court of Appeal decision shows ignorance is no excuse for executors who fail to notice misconduct by their co-trustees, says Toronto estates litigator Alexander Turner.Read more here.
Trustees can't always rely on the estate to pick up their legal tab by Alexander Turner
A series of recent cases should serve as a reminder to estate trustees that they could end up personally on the hook for litigation costs, says Toronto estates litigator Alexander Turner.Read more here.
Grieving the loss of a marriage is often amplified during the holidays by Richard Diamond
The holiday season can be a difficult time for recently separated spouses, as they navigate new arrangements with their children and deal with the often amplified emotions of divorce, says Toronto family lawyer Richard Diamond.Read more here.
Can a woman bequeath her frozen eggs? by Jessica Feldman
The Ontario government’s All Families are Equal Act will resolve some legal questions in cases involving frozen reproductive material, but with reproductive technology still in its infancy, estate planners will be charting new territory for years to come, says Toronto trust and estate lawyer Jessica Feldman.Read more here.
Children 'wrongly retained' according to Hague Convention: Diamond
TORONTO — Two Canadian children at the centre of a protracted custody dispute must return to their father in Germany over their objections and against the wishes of their mother, Ontario's top court ruled Tuesday.Read more here.
Transparency, communication key for power of attorney role by Alexander Turner
How someone acting as a power of attorney for an estate communicates and reports to the other interested parties goes a long way in avoiding court action, says Toronto estate litigator Alexander Turner.Read more here.
Feldman to chair event on intersection of fertility, estates law by Jessica Feldman
Toronto trust and estate lawyer Jessica Feldman is chairing an upcoming program which will explore the issues estate lawyers should consider when advising clients in cases that involve frozen human reproductive material.Read more here.
Strongly consider written agreement when executing mutual will by Alexander Turner
Toronto estate litigator Alexander Turner says a recent Ontario Superior Court of Justice decision illustrates an interesting example of the application of the mutual wills doctrine.Read more here.
Dealing with business assets, liabilities in your estate plan by Kristine Anderson
In part one of this series, I explored what happens to your sole proprietorship when you die, provided information on the pitfalls of dying without a valid will in place, and explained the importance of appointing an estate trustee. In part two, I will tackle how to deal with specific business assets and liabilities in your corporate estate planning.
What happens to my business when I die? by Kristine Anderson
Starting and running your own business as a sole proprietor may be more common today but that doesn't mean it’s easy — it takes large amounts of time, energy, focus and vision.
The importance of estate planning for young families by Jessica Feldman
Young families may think estate planning is too expensive or that it’s not a priority, but there are several considerations to take into account, says Toronto trust and estate lawyer Jessica Feldman.Read more here.
Alexander Turner finds fair solutions to estate issues by Alexander Turner
Alexander Turner thrives on helping people find fair and practical resolutions to estate legal issues.
The Toronto litigator advises and represents clients seeking solutions to problems and disputes involving wills, guardianships and powers of attorney.