Ontario law has seen the treatment of common law spouses differ greatly from married spouses. One issue that leads to this is the how the “spouse” is defined in two separate Acts: The Family Law Act (FLA) and the Succession Law Reform Act (SLRA).
Because of the inconsistency between these two acts, common law spouses fail to receive the same automatic rights as married spouses. For example, the SLRA outlines that your entire estate goes to your closest blood relative, unless otherwise specified in a will. This means that your child, parents or siblings take full priority over your significant other.
Amy M. MacAlpine, a Wills and Estates lawyer with Hummingbird Lawyers LLP, provides some examples of how you can make sure your common law spouse is taken care of in the event of your death.
Dying intestate (dying without a will) creates many problems that may have once been overlooked or never thought of. MacAlpine notes, “Not creating a will can result in unfortunate and inadvertent outcomes that can be both financially and emotionally devastating.”
Fortunately, MacAlpine says that there are some easy ways to avoid those outcomes.
Create a will
A will is a legal document that appoints an Executor or Trustee who will be responsible for carrying out your wishes after you pass.
“Creating a will is a simple and economical way to avoid an inadvertent and sometimes catastrophic event.” MacAlpine continued, “Within a will, you can direct your Executor to legally transfer your property and assets, whole or in part, to your common law spouse.
“This ensures that your assets go directly to the person you intend to continue to provide support.”
MacAlpine notes that having a lawyer prepare your will can save time, money and emotional distress for your common law spouse. It also ensures that it reflects current law, includes all the powers your Executor may need and meets the requirements of a valid will.”
Hold property by joint tenancy
Holding property with a joint tenancy is another way to provide for your common law spouse. MacAlpine explains that, “By operation of law, the survivor of a joint tenancy inherits the entire interest or ownership of the property. This happens automatically and will not require a will or probate.”
Because this is done outside of a will, it will avoid probate fees and as a result, your loved one will receive more financial support. On the topic of finances, Bank accounts and real estate are easy assets to transfer into joint tenancy.
While this may be the case, MacAlpine still recommends that, “Prior to transferring any property you should consult your lawyer and accountant to discuss all the possible tax and legal consequences.
Complete beneficiary designation forms
To prevent your common law spouse from being left out of your estate, MacAlpine recommends completing beneficiary designation forms. “These forms are provided by life insurance policies, RRSPs, RRIFs, TFSAs and pensions,” she explained.
She continued, “By doing this, the finances will automatically go directly to the beneficiary outlined in the forms. Similar to the joint property transfer, this also acts outside of a will and without probate fees.
Always be sure to keep track of your forms once they are completed. Also, keeping track of them allows you to confirm whether they properly reflect your current wishes. Note: A common misconception about these forms is that making a will, or getting married, may trump an old listed beneficiary.