Family estate planning can be a complex endeavour in any circumstance, especially if there are issues to consider such as trusts, family businesses, and investments. However, when each person in a couple has children from previous relationships, the situation becomes even more complicated. When drafting a Will or otherwise making an estate plan for a blended family, there are certain considerations that must be taken into account to avoid trouble down the road such as hurt feelings, unnecessary headaches for executors or even costly litigation.
The primary issue that comes up most often when estate planning for a couple with children from previous relationships is how to handle beneficiaries. When a couple only has children together, there is a standard line of succession, in that a testator will usually leave their estate to their spouse, who will then leave everything to the couple’s children upon their death. Most Wills will also contain a clause saying that if the other spouse should predecease the testator, the estate will go to the couple’s children directly. This becomes much more challenging when the testator has children from a previous relationship whom they want to ensure will benefit from their estate. In this scenario, the testator cannot know for certain that their current spouse will pass on a portion of their estate to those children after death. Because of this, careful planning is essential.
Legal Obligations to Stepchildren Under B.C. Law
Under provincial succession law, certain familial relationships create obligations with respect to estate planning. For example, if a spouse or a child is left out of a Will, they can bring a legal challenge in court claiming that they were not sufficiently provided for under the Will. With respect to children, this right is limited to biological and adopted children; stepchildren are not legally entitled to bring such a challenge. Even when it comes to biological or adopted children, they may not be successful if they are adults living independently. In this case, a court is likely to determine that the parent was entitled to leave their child out of the Will. This situation would likely be different in the case of an adult child with disabilities, however.
According to British Columbia’s Wills, Estates and Succession Act, (WESA), a step-parent has no legal obligation to leave any portion of their estate to their stepchildren. This means that even if a couple had discussed the surviving spouse providing for the children of the deceased spouse after their death, there is no obligation to do so. For this reason, many couples with children from previous relationships must take additional steps to ensure their children retain a right to their estate when they die.
Estate Planning Options for Blended Families
There are certain precautions couples can put into place to protect the interests of their children from previous relationships upon their death. First, a couple can enter into a carefully drafted marriage agreement protecting the assets each person brought into the marriage. Secondly, if the couple purchases a home together, they can choose to take title as Tenants in Common rather than Joint Tenants. The differences between the two forms of ownership are critical in terms of how the property is treated after the death of one owner. As Joint Tenants, each owner on title owns 100% of the property and the surviving spouse has an automatic right of survivorship. This means that the entire property could be transferred into their name upon the death of their spouse. Tenants in Common, however, enables property owners to divide the ownership of the home and hold the shares separately, so they can pass the shares on or sell their interest independent of the other owner. If a couple owned a home 50/50, each spouse could leave their half of the property to their children, entitling them to half of the proceeds when the home is eventually sold.
Estate matters can quickly become acrimonious, particularly when a second marriage is involved. One of the best things a parent can do is to pre-plan and carefully outline the rights of their children from a previous relationship. This will go a long way to eliminating stress and potential court battles between the various parties after one’s death.
The estate lawyers at Cherkowski Marsden LLP in Vernon are extremely knowledgeable with respect to all aspects of estate planning and Will drafting. They have extensive experience drafting countless custom estate plans that range from simple to highly complex. For questions and advice about your estate planning needs, please contact their office online or by phone at 250-308-0338 (Vernon office) or 250-803-9171 (Salmon Arm office) to schedule a consultation.