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Estate Litigation

In the estates and trusts field, a seemingly minor dispute can be very hard to resolve. Complicated legal issues combined with this highly-charged and emotional time can lead to difficult situations. The team at Shibley Righton LLP can help. We act for estate trustees and other fiduciaries, individual and institutional beneficiaries, as well as drafting solicitors.

Our lawyers can assist with the following branches of Estate Litigation:

  • Will Challenge / Will Interpretation Applications
  • Guardianship Applications
  • Passing of Accounts Applications
  • Solicitor's Negligence Claims
  • Removal / Replacement / Appointment of Estate Trustees
  • Rectification and Variation of Wills and Trusts
  • Claims Against Estates

As a full service firm, we regularly liaise with our Tax Group, our Real Estate Group, and our Wills and Estates Group in order to give our clients the most complete level of service. Together, we guide our clients by giving advice and opinions in an efficient, thorough, and cost-effective manner. 

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Marlin Horst head shot

Testators can head off the threat of an estate dispute by explaining decisions to family members before death, says Toronto corporate and estates lawyer Marlin Horst.

“The worst situation is where someone passes away, and the family is shocked by the contents of the will,” says Horst, a partner with Shibley Righton LLP. “It shouldn’t be that way, but it’s that lack of communication that leads to so many family disputes.”

A recent survey carried out by TD Wealth identified family conflict as the biggest threat to estate planning, with almost half — 46 per cent — of respondents claiming it was their biggest worry. That figure was almost double any other concern, with market volatility and tax reform trailing behind at 24 per cent and 14 per cent respectively.

Digging even deeper into the issue of family conflict, 30 per cent of respondents cited beneficiary designation as the biggest point of contention. Other leading causes of conflict were non-communication and blended families, according to the survey.

The results come as no surprise to Horst, who advises his clients to forewarn family members about any decisions that depart from the norm.

“There are a few assumptions made in families that will not always hold true,” he tells AdvocateDaily.com. “So when a client wants to give a large portion to charity or differing amounts to their children, I ask them to think long and hard about it, and then to explain to their children what is going to happen and why.”

According to Horst, parents will frequently have understandable reasons for differential treatment of their children in a will, and he says the simple act of disclosing them offers a release valve for any developing sibling resentment.

“Parents may base the allocation on the actual or perceived financial need of each child,” he says.

But even equal treatment among children is no guarantee of smooth estate administration, especially in cases where one sibling feels they are more deserving than the others.

“It’s not unusual for the bulk of caregiving responsibilities for elderly parents to fall on one child, so if they get the same share as siblings who did nothing, that can cause strife, even though it’s a typical way to divide an estate,” Horst explains.

He says another common gripe can see bereaved family members divided along generational lines when testators make their bequests to their grandchildren rather than their direct offspring.

“It comes up more often in wealthier families, but the children of the deceased are offended because they see it as an indictment of their ability to be good stewards of the family wealth,” Horst says.

While he acknowledges some estate disputes are unavoidable, he says the chances are reduced when testators are open about their intentions.

“Communication is key in my mind,” Horst says. “At the same time, estate litigation is one of the fastest-growing areas of the law, and we’re going to be seeing a lot of movement in the coming years as the aging Baby Boomer generation — the wealthiest to ever live — transfer their assets to their children.”

 

 

Date_Published
2019-11-18
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Matthew Urback Head Shot

The controversy surrounding the death of financier Jeffrey Epstein shows that no matter how rich or famous you are, issues around estate planning can come up after you die, says Toronto wills and estates lawyer Matthew Urback.

“Having hundreds of millions of dollars does not necessarily insulate anyone from the legal challenges in an estate after a person dies,” says Urback, a partner with Shibley Righton LLP.

According to a CNBC story, a bitter legal battle is expected following the 66-year-old’s suicide in a Manhattan jail cell, where he was being held pending trial on charges of sex trafficking with minors. His last will was drawn up just two days before his death, the story states, with his estate valued at more than US$577 million, as well as the fine arts, antiques and collectibles that have yet to be evaluated.

It is expected that the women who accused him of sex offences will file claims against his estate, tying it up in litigation for an unknown period of time, CNBC reports.

While Ontario’s laws in this area are different from those in the United States, Urback says the tussle over Epstein’s fortune provides three valuable lessons for people on this side of the border.

Your debts don’t die with you

“Epstein left quite a sizeable estate, and many lawsuits are almost certainly coming against it, so I think people might wonder if the same situation arose here in Canada, would the debts be passed onto the beneficiaries,” Urback tells AvocateDaily.com.

“The answer is no because any money awarded from the lawsuits is taken from the estate first, with no liability passed onto heirs,” he says.

In Ontario, if someone has launched a lawsuit against an individual and that person dies, a court order has to be granted for the action to continue, with the estate trustee or executor standing in place of the deceased person in defending the lawsuit, says Urback.

“If Epstein were an Ontario resident, just because he’s dead wouldn’t mean that he would escape from his debts,” he says.

We don’t have an estate tax

Since one of Epstein’s five homes is located in New York City, the story notes that New York State will probably apply to have its estate tax — which tops out at 16 per cent — levied against him.

“By contrast, Canada is a very favourable jurisdiction for hoarding assets and wealth and transferring it onto future generations,” says Urback.

The only thing Canadians pay upon death is a probate fee of approximately 1.5 per cent of the estate, he says, explaining that it’s meant as more of an administrative surcharge.

“Who knows, one day our government may bring in an estate tax, following the example of other countries, including the United States,” Urback says.

Deathbed wills are valid but troublesome

The story states that Epstein’s last will was drawn up two days before his suicide.

“There’s nothing wrong with that, as people make wills all the time on their deathbed, but that can lead to potential challenges,” says Urback.

“Doing a will right before your death isn’t inherently problematic, but the circumstances surrounding it leads to some vulnerabilities,” he says.

Those challenging the will of people who are unhealthy and nearing the end of their lives could argue they are not competent or susceptible to undue influence, even though there have been cases in Ontario where people suffering from illnesses have been deemed to have the capacity to change their wills, Urback says.

“If someone is in hospital and being medicated, those drugs can impact their thinking and mental state, leaving open an avenue for people challenging the will,” he says.

“Many issues evident in the Epstein case really transcend economic status,” Urback says.

 

Date_Published
2019-11-04

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