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Saturday, March 12, 2011

Should I re-do my will when I am separated from my spouse?

While at one of the local Scotiabank branches yesterday, I happened to stop to chat briefly with a customer. She said that her banking officer had just told her that because she is separated from her spouse, she should re-do her will. She didn't really understand why. She isn't alone; many of us don't really think about wills during that particular life event, and even if we do, we don't necessarily understand the implications.

In many parts of Canada, including here in Alberta, becoming separated or even divorced from your spouse doesn't have any legal effect whatsoever on your will. Most married people have wills that leave their entire estates to each other. Usually you're not quite so keen for the person to have your whole estate if you're not married to them anymore.

You could, for example, spend a year or so battling through your matrimonial property division until all assets are divided. But if you are killed in a car crash and haven't changed your will, your former spouse will get everything right back again under your will.

This isn't the same everywhere. In Ontario, separation has no legal effect on your will. However, if you are divorced, the parts of your will dealing with your spouse are rescinded. Your will might be alright, but then again it might not. If you appointed your spouse as your executor, as most married people do, and then left the whole estate to him or her, rescinding those parts of the will might have the effect of rescinding pretty much all of your will.

Your goals have changed now that you are separated, and your will should reflect that to make sure that your current wishes are carried out. Most people will want to focus on leaving funds to the children or if there are no children, to other family members and charitable organizations.

Making a separation agreement in which you both agree not to make claims on each other's estates (which is standard boilerplate language) does not in any way change your will.

In my view, the banking officer was absolutely right to alert the customer to the need to look at her will during her separation. This is good advice right across the country.

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