Introduction – Testamentary Freedom and Its Restrictions in Ontario
In Spence v. BMO Trust Company, the Court of Appeal for Ontario affirmed an individual’s right to dispose of their property as they choose upon death. Similarly, the Supreme Court of Canada in Tataryn v. Tataryn Estate emphasized the significance of testamentary freedom but acknowledged its limitations under provincial legislation.
Ontario’s Family Law Act and Succession Law Reform Act (SLRA) impose restrictions on absolute testamentary freedom. For example, financial obligations like spousal support under the Family Law Act and dependent claims under the SLRA allow eligible individuals to make claims against an estate. Part V of the SLRA specifically addresses mechanisms for providing support to dependents who were not adequately provided for by the deceased.
This article explores the grounds for contesting a will in Ontario. If the deceased owned property in other jurisdictions, additional complexities may arise, making professional guidance critical. Consult an experienced Canadian accountant for assistance in understanding the tax implications related to contesting or managing an estate.
Grounds for Contesting or Challenging a Will in Ontario
A will is generally considered valid if the deceased:
- Had testamentary capacity to make or approve the will.
- Knew and understood the contents of the will.
- Signed the will voluntarily without undue influence or coercion.
- Was not operating under mistaken beliefs during its execution.
If these conditions are not met, the will can be declared invalid.
Dependent Relief Claims:
Under the SLRA, dependents—including common-law spouses and children—can claim relief if they were not adequately provided for. The SLRA defines “dependent” broadly, encompassing children conceived after death (e.g., through in vitro fertilization) and divorced spouses. Courts can order adequate provisions for dependents from the estate if claims are substantiated.
What Happens if a Contested Will is Declared Invalid?
If a will is declared invalid, the deceased is deemed to have died intestate (without a valid will). In Ontario, the SLRA governs the distribution of intestate estates:
- Preferential Share: The surviving spouse is entitled to the first $200,000 of the estate's net value.
- Residue Distribution: Remaining assets are divided between the spouse and children.
If the deceased left no spouse or children, property distribution follows SLRA provisions for next of kin. Common-law partners can make dependent relief claims irrespective of intestacy or a will’s validity.
Who Can Contest a Will in Ontario?
Under Rule 74.15 of the Rules of Civil Procedure, any person with a financial interest in an estate can contest a will. This includes individuals making dependent relief claims or those entitled to inherit under intestacy laws.
How to Contest a Will in Ontario
To contest a will, an interested party must file a notice of application with the Ontario Superior Court of Justice. The application may challenge the will's content or the estate trustee’s actions.
Legal representatives of the estate may require court approval through:
- Certificate of Appointment of Estate Trustee with a Will (if a valid will exists).
- Certificate of Appointment of Estate Trustee Without a Will (in cases of intestacy).
- Certificate of Appointment During Litigation (when a will is contested).
Limitation Period for Contesting a Will
Under Ontario’s Limitations Act, the limitation period for contesting a will is two years from the date the claim is discovered. Additionally, no proceeding can commence after 15 years from the date of the act or omission giving rise to the claim.
Tax Guidance and Contesting a Will in Ontario
Contesting a will has potential tax implications for the estate and beneficiaries:
- Estate Income Tax: Income earned during the estate's administration may be taxable.
- Dependent Relief Payments: These may require careful structuring to minimize tax burdens.
If you feel that you were unfairly treated under a will or were left out entirely, seek guidance from a qualified Canadian accountant. A professional accountant can ensure that all financial and tax-related aspects of contesting or managing the estate are handled correctly.
Conclusion
Contesting a will in Ontario is a complex process requiring thorough understanding of legal and financial frameworks. While dependents and financially interested parties may have valid claims, the mere dissatisfaction with a will's content is insufficient grounds to contest it.
Engaging an experienced accountant ensures proper financial management and minimizes the tax impact on the estate and beneficiaries. For tailored guidance, consult a Canadian accountant specializing in estate and tax matters.
This article is written for educational purposes.
Should you have any inquiries, please do not hesitate to contact us at (905) 836-8755, via email at [email protected], or by visiting our website at www.taxpartners.ca.
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