Transitioning to WESA

As we have mentioned on several occasions, the Wills, Estates and Succession Act (“WESA”) is now in force.  That does not mean, however, that every legislative provision that WESA replaces is entirely obsolete.  Sections 185-190 of WESA contain the transition provisions and provide, in part, as follows:

  • the provisions regarding the validity of wills and the legal effect of wills apply if the will-maker died on or after the date WESA came into force, even if the will was executed prior to that date.  However, the WESA provisions will not invalidate a previously valid will or revive a previously revoked will;
  • the variation of wills provisions apply if the will-maker died on or after the date WESA came into force.  However, these provisions are generally the same as under the Wills Variation Act;
  • the provisions regarding survivorship, intestate distributions, and estate administration, among others, apply if the will-maker died on or after the date WESA came into force;
  • the provisions regarding beneficiary designations apply if the participant dies on or after the date WESA came into force;
  • administration and probate granted under the old legislation are treated as though they have been granted under WESA; and
  • the court may give any transitional directions that are necessary in the circumstances.

In most cases, if the deceased died prior to WESA coming into force, the old legislation will apply.

The amendments to the Supreme Court Civil Rules (the new probate rules), which came into force at the same time as WESA, apply to proceedings taking place after the date they came into force.  In other words, regardless of whether WESA applies or not, the new probate rules provide the appropriate procedure.

An Update on Interests in Discretionary Trusts under the Family Law Act

In a previous post, we discussed some of the issues raised by the new Family Law Act (the “FLA”) in the context of discretionary trusts.

Under the FLA, “family property” is divided equally between spouses, and includes all real and personal property owned by one or both spouses at the date of separation, unless the property is “excluded property”. If the property is “excluded property”, any increase in its value during the relationship is still shared equally between the spouses on a breakdown. Currently, “excluded property” includes property held in a discretionary trust where the spouse did not contribute to the trust, the spouse is a beneficiary of the trust, and the trust was settled by a person other than the spouse. As a result, many discretionary family trusts used for estate planning fall within “excluded property” under the FLA. This means that the growth in value of trust property during the relationship may be subject to division, which is problematic since the spouse’s interest in the trust is only discretionary and there is no guarantee the spouse will benefit from the trust property.

Recently, the provincial government introduced Bill 14, Justice Statutes Amendment Act, which proposes amendments to the FLA in an effort to address this concern. If the amendments come into force, the meaning of “excluded property” will be modified with the result that only the growth in value of a spouse’s beneficial interest in trust property (and not the trust property in its entirety) will be subject to division. This change will help clarify the application of the FLA to interests in discretionary trusts, but will also raise valuation issues since it is more difficult to value a spouse’s interest in a discretionary trust, than it is to value the underlying trust property.

WESA Summary

Further to Amy’s post, our Wealth Preservation Group has prepared a summary of the Wills, Estates and Succession Act which provides an overview of some of the key changes that the new legislation will bring. This summary is in the current issue of our newsletter, Your Estate Matters, and is available here.