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  Personal Planning: Wills and Powers of Attorney
by Heather McKinnon, B.Comm., LL. B


Why Make a Will?

Preparing a will is one of the most important tasks you will do in your lifetime. A will is essential in order to simplify matters following your death and allows you to plan a sensible, cost effective and satisfying transfer of wealth. It provides you with the opportunity to prepare for the future in a manner that protects you and your loved ones. A carefully planned will is also imperative if you are responsible for the care and support of an individual with special needs.

Why Make a Will Through a Lawyer?

The making of your will, in all likelihood, will result in the largest transaction that you will ever undertake in your lifetime. In view of the fact that your will contains the sum of your life's transactions, it only seems logical to seek professional advice.

To make a sound will, you need to consider numerous factors, such as your assets and how you hold them, taxes that arise at death and how to postpone them, immediate cash to deal with death expenses/taxes, etc. It is imperative that someone help you identify all of the issues that you must address and provide you with options as to how you might best deal with these issues.

Everyone is unique with unique circumstances that generally cannot be fully and/or adequately addressed with a fill-in-the-blank will.

Dying Without a Will

A properly prepared will ensures that your property passes on your death to those whom you wish to benefit. Without a will, your property may pass to individuals you did not intend to benefit, while those you wanted to benefit, receive little or nothing.

When a person dies without a will, the law in Ontario provides a formula for dividing the property of the deceased person. This formula, with the exception of the spouse, only provides for relatives of the deceased. To qualify as a spouse under this law, there must be a legally recognized marriage. Furthermore, the division and distribution of the property of a person who dies without a will is slower and more expensive than that of a person who dies with a will.

Essentially, the distribution is such that the spouse receives the first $200,000 of the deceased's property and anything in excess of $200,000 is split between the deceased's spouse and children. If the deceased leaves a spouse and two or more children, the spouse is entitled to the first $200,000 and any amount over $200,000 is distributed one third to the spouse and two thirds equally between the children, however many there are. In circumstances where there is no spouse or children alive, the deceased's property goes to his/her next of kin. If there is no next of kin, then the deceased person's property becomes the property of the Government of Ontario.

Will Review

Your will should be reviewed at least every five years to ensure that both new laws and your changing circumstances are reflected in your will. A will should also be reviewed immediately in the event a named beneficiaries dies, marriage, divorce, birth of a child or grandchild, or if there is a significant change in the value of your estate. A will is revoked by marriage, except in certain limited circumstances.

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Powers of Attorney

What is a Power of Attorney?

While a will deals with your wishes about matters after your death, a power of attorney deals with matters while you are alive. A power of attorney is a legal document wherein you appoint the person of your choice to make decisions for you in the event that you are unable to make your own decisions. When you give someone power of attorney, you are giving that person the authority to make all the decisions that only you yourself would normally be entitled to make.

All powers of attorney cease to be effective upon death, at which time your will comes into effect.

Power of Attorney for Personal Care

A power of attorney for personal care enables the person you have appointed to make any & all personal care decisions for you if you become incapable of making them for yourself. It includes authorizing the person you have appointed to make decisions that may pertain to your health, your medical treatment, where you are living, etc. It only becomes effective if you become mentally incapable of making your own personal decisions.

General Power of Attorney for Property

A general power of attorney for property is used if a mentally capable person wants to appoint someone to act on their behalf for a specific period of time or for a specific task. It becomes valid immediately unless otherwise stated in the document and ceases to be of any effect if the person who gave it becomes mentally incapable.

Continuing Power of Attorney for Property

A power of attorney for property enables the person you have appointed to make any and all decisions with respect to your property that you would normally be capable of making for yourself. This may include such things as making bank deposits, paying bills, investments, buying, selling or refinancing a home, filing income tax returns etc. This power of attorney can be made effective immediately, while you are mentally capable and/or it can be made to be effective in the event of any mental incapacity.

Why Make Powers of Attorney?

If, for some reason, you are unable to make decisions about your financial or personal affairs, who will make those decisions for you? Mental incapacity can happen to any of us, at any time. It can happen suddenly, as a result of a stroke or accident, or gradually as a result of a disease like Alzheimer.

If you do become mentally incapable, who would you prefer to have looking after your affairs? Someone of your choosing or someone in accordance with legislation or from the government? If you have not already appointed a power of attorney and you become mentally incapable, it will be too late for you to choose.

If you become mentally incapable and do not possess a power of attorney for personal care individuals not of your choosing may be making decisions for you with respect to medical treatment. The Health Care Consent Act provides for who may make consent to treatment decisions on behalf of an incapacitated person. This person could be your spouse, your child or your parent, your sibling or any other relative.

Should you become mentally incapable and do not possess a power of attorney for property, the government may become responsible for your affairs and will conduct them in the manner that they feel is best for you. While the government has certain legal obligations to manage your assets fairly, your family's views and needs, and even your own views and needs, might not be adequately taken into consideration

By choosing to prepare powers of attorneys, you are in control of your future. A power of attorney is a simple and inexpensive way to plan ahead and choose who will make decisions for you on your behalf if you are unable to do so yourself.

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This website contains general legal information and this information does not constitute legal advice. If you require specific advice you should contact and retain a lawyer directly. Zimmerman McKinnon Anderson expressly excludes any representations or warranties express or implied to the fullest extent possible.



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