by Lisa Collins | April 15, 2014
Over the past couple of weeks, we have been highlighting some of the key changes resulting from the Wills, Estate and Succession Act (WESA), in regards to BC’s wills and estates legislation. Click here to see previous posts in the series. In this final part of this blog series, we outline some final important changes.
Gifts and Loans
Previously, it was presumed that a gift made during a will maker’s lifetime to a child was an advance of that child’s inheritance. This is no longer the case. With WESA, any gifts in the will now survive and are distributed according to the terms in the will.
The following presumptions have also been abolished:
- That legacies in a will are revoked if the will-maker made a lifetime gift in the same amount
- That a debt owed by the will-maker is satisfied by an equal legacy to a creditor.
If you would like to account for either of the above in your estate, it will now be necessary to specifically indicate this in the estate plan.
Benefit Plan Beneficiary Designations
WESA includes a new framework for benefit plan beneficiary designations. WESA benefit plans are those which provide benefits to employees, their dependents, and their beneficiaries, including pension/retirement plans, welfare or profit sharing plans, and others. These can also include arrangements for the payment of an annuity, RRSP, RRIF or TFSA.
This section of WESA does not apply to contracts of insurance or declarations for Life/Accident/Sickness Insurance – these are governed by the Insurance Act of BC. Where there is a conflict or inconsistency with other BC or Federal enactments, those prevail over WESA.
A beneficiary designation itself under WESA is fairly informal; it only needs to identify the plan contract, the benefit and the intended beneficiary(s). For written documents, forms or agreements (other than a will), there is no requirement for a witness when signing the designation. WESA now allows for an irrevocable beneficiary designation, but this cannot be made in a will and must be filed with the specified office of the benefit plan administrator. Additionally, a designation can now be made in many formats: in a will, on a benefit plan administrator’s form, in a legal document/agreement, or as a declaration (written or electronic). You can see that the scope is quite broad!
With designations now allowed in additional formats, executors will have far more responsibility to seek out beneficiary designations that may have been made outside the will (and/or be in conflict with the will). Moving forward, it will be crucial for your lawyer and financial advisor to work closely together, to ensure that your will plan is coordinated with any beneficiary designations.
Any questions about the new WESA? Leave me a comment below. If you’re ready to explore whether a review and update of your estate plan is in order, please contact me at any time.