Suddenly Your Married Spouse Dies: What are Your Family Law Election Rights in Ontario?
First off, you are entitled to condolences. Losing a spouse is a devastating event. It shatters your world and turns you upside down. You struggle with your new reality. Everyone is ready to give you advice and you are bombarded with questions.
You need experienced legal advice in estate matters. Here are some things to consider.
First, confirm there is a valid will
Some lawyer-prepared wills are not easy to understand. Some lawyers use legal lingo that is difficult to read or interpret. You may need to consult a lawyer other than the will lawyer for advice.
Some people reduce probate costs by preparing multiple Wills. These Wills are often referred to as primary and secondary Wills (or private and public Wills). These may group assets into different categories. Some assets then become subject to provincial Estate Administration Tax EAT.
Consult estate lawyers, not family law lawyers
Family law lawyers do not usually handle common estate documents or issues. They can recommend that you consult an estate lawyer. This could be a lawyer familiar with a Family Law Election or estate issues like your spouse’s business.
Is There a Business?
It may be wise to decline to act as the estate trustee if there are unknown liabilities. Handling a professional practice is risky. You may not be prepared to operate it until it can be sold. How much do you know about running an accounting or dental practice?
If a professional is co-executor, you may wish to let them administer the estate business.
Your Ontario Family Law Election Rights
These are not voting rights. You have the right to decide what share of the estate you receive. Election means you have the right to choose (elect) what you receive from your deceased spouse’s estate.
Here are your options:
- If there is a will, you may accept your gifts under the will. If your spouse leaves you everything in his will, you may be immediately relieved.
- If there is no will, you may accept your statutory rights to share in your spouse’s estate. (If there are no children, you inherit all. See below.)
- If you make an election, under the Family Law Act you may receive what you would be entitled to if you filed for divorce. This is half of the difference between your net family property and your late spouse’s net family property.
Is There a Domestic Contract?
If there is a prenup or domestic contract, your election rights may have been modified.
To make an election, you must start a court application and make your election within 6 months of your spouse’s death. Courts can extend these time limits. But it is too risky to delay or do nothing.
You need financial information from the estate executor. You may need to go to court to obtain more time. Making the election disqualifies you as the estate executor. That is a factor to consider with your estate lawyer.
Courts have limited discretion to award an unequal division of family property. This could be more or less than half the difference between your net family property values.
Do You Need Help?
*If there are children, you receive your spousal preference share or the first $200,000 after expenses plus a share of
- 1/2 of the residue if there is 1 child or:
- 1/3 of the residue if there are 2 or more children.