It’s Never “Just a Will”

Why your lawyer is nosy about your assets when you just want a will.

We often hear some variation of the following: “I have a simple life and I want a simple will. Why are you asking for detailed information about my house(s), bank accounts, investments, life insurance, etc.?” In today’s post, we will provide a brief overview of why such information is so important for a lawyer asked to draft someone’s will.

Most people know they can name a beneficiary of their life insurance, pension, RRSP and TFSA, or that having both their name and the name of their spouse on the title to their home may make things simpler if one of them dies. Unfortunately, many have not taken the time to sit down with estate planning professionals to ensure that the way they have structured their assets is sound from a legal and tax standpoint. Sadly, the consequences for failing to attend to such considerations can be an unpleasant legacy left for loved ones. This is why when someone contacts us for help with a will, we respond by saying we would be happy to assist with their will and estate planning.

A will-drafting lawyer’s job is not just to write a will that says what a client wants, but to look at the overall picture of how a client’s assets may flow upon their passing. Then our role is to help the client come up with a plan that increases the likelihood that their wishes will be fulfilled after their death. These steps usually include crafting a will but should always involve more than that.

When a client comes to us for help with a will, it is part of our job to also help them ensure that their will and the way their assets are set up work together well. The goal is to provide a client with information, options, and advice that enables them to set up their asset structure and will (and any other related documents) so all those pieces work together as efficiently and securely as possible given the client’s wishes, assets, and circumstances.

Contrary to common belief, one need not have lots of money, complicated assets, or a complicated family situation to benefit from this approach. We consistently find that folks with very simple and modest estates can save their surviving family members significant hassle and expense with some relatively minor tweaks to how their assets are arranged. This is why we ask clients who come to us for assistance with a will to provide relatively detailed information regarding their assets and liabilities.

Getting detailed information about a client’s assets when asked to assist with a will is such an important aspect of the lawyer’s duty that a practice note, aimed at lawyers and entitled Documenting Client Discussions to Avoid Negligence Claims (produced by Thompson Reuters’ Lexis Practical Guidance service) states:

“If the client does not wish to discuss the details of his or her wealth, the lawyer should seriously consider declining the retainer or referring the client elsewhere.”

In future articles, we will discuss several ways that various asset arrangements and documents other than wills can achieve one’s estate planning goals more effectively than a will alone, even if one has a “simple situation”. Those posts should provide a good overview of some of the many ways detailed information about one’s assets can be vitally important to a lawyer’s ability to assist. To briefly summarize in the meantime though, we will conclude by attempting to provide a succinct answer to the following oft-asked question:

I have a simple life with simple assets and all I want is a simple will, why do you want me to fill in a detailed assets and liabilities questionnaire!?

We do this for three main reasons (though there are others):

• It allows us to see if a client has any assets that require special planning. For example, assets such as: small business assets, shares in a private company, Registered Education Savings Plans, Registered Disability Savings Plans, significant accumulations of air-miles or similar reward points, time shares, burial plots, assets in other jurisdictions, second homes / vacation homes / rental properties, and many others, often require special attention. We frequently encounter folks who are insistent that their situation is simple, but they have assets that require special attention and are unaware.
• It is a helpful tool to assist a client in going through the important process of checking on all their assets and making sure they are structured the way they want. For example, checking on that RRSP or life insurance policy set up years ago before one was married to one’s current spouse to see if the beneficiary needs to be updated. For a sad example of why going through this exercise regularly is so important, one need only look to this case that was recently in the news.
• It allows us to have a robust basis to test and document that a client knows what their assets are and the approximate value of those assets. This awareness of one’s assets and their value is one of the key components of the test for mental capacity to make a will. Someone may later assert that a will should not be upheld because the client was not mentally capable when giving instructions or signing their will. For example, it might be asserted that someone was suffering from an illness, taking medication, or dealing with a particularly overwhelming life event like the recent loss of a spouse that affected their mental capacity. If such a claim is raised, the drafting lawyer’s notes regarding assessment of mental capacity can be critical in efforts to have the will upheld. A detailed list of a client’s assets, produced by the client, can play a vital role in a lawyer’s efforts to build a robust set of notes documenting how the lawyer concluded that the client had the required mental capacity at the relevant times.

So, the next time you go in for help with a will, remember that the lawyer will be (or at least should be) asking for detailed information about your assets because it is needed to do the job properly. Even for the simplest situations, it is always a matter of addressing the will and estate planning – it is never just the will that requires attention. This approach helps protect your wishes and the people you leave behind.

In future posts, we will expand upon this idea by discussing some of the basic estate planning considerations relevant to commonly held beneficiary designatable assets like life insurance, RRSPs and RRIFs, TFSAs, pensions, and some investment products.

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Photo by Melinda Gimpel on Unsplash