If my child dies before me, does my son or daughter in law get their share?

Estate planning lawyers ask a lot of "what if?" questions. One of the questions we ask parents who are leaving their estates to their children is what they would like to see happen to a child's share if that child should die before they do. I know nobody wants to think about this, but it's an important question for the proper set-up of the Will.

I've noticed that there is some misunderstanding out there about what will happen with a child's share in this circumstance. Many people assume that the child's share will automatically go to the child's spouse (the son or daughter in law). Others assume that there is some obligation on them to leave something to the son or daughter in law. Neither of those things is true.

Inheritances generally follow the family's bloodlines. This means that if you do not leave a Will, your estate is divided among your spouse and your issue - that is, your direct descendants in your bloodline. Nothing goes automatically to anyone who is married to your issue.

When parents make Wills, they generally state that the estate is to be divided among their children, and that if one of the children should die before them, the deceased child's share is to be divided among that child's children (the parents' grandchildren). As a side note here, if you want to include grandchildren, insist that your lawyer not use the word "issue", which means all following generations.

It's unusual that parents want to leave a deceased child's share to that child's spouse, but it isn't unheard-of. In the case of longstanding marriages, in particular, the parents may want to leave some or all of the child's share to the spouse. It's always the client's choice. In cases like that, I recommend that the gift be made to the son or daughter in law only if he or she was married to and living with the parents' child at the time of the child's death. That eliminates shares going to spouses who are separated or getting divorced.

You can't leave a gift of money to your child on the condition that he or she doesn't share it with his or her spouse. Once you've given the money away, you have no say in what the beneficiary does with it. Also, you can't leave money to your child on the condition that he or she doesn't marry someone you don't like. If you are in a quandary about what to do regarding a child's share, talk to an experienced estate planning lawyer to get some ideas and find out the facts.

What do the in-laws get?

I met with two separate sets of clients this week who asked similar questions. They wanted to know if they were leaving a part of their estate to their married adult child, and the child died before they did, whether the child's spouse would inherit the share that the child would have received if living. This is a very common question.

For example, John and Mary are the parents of Dan and Doreen. Dan marries Janet. John and Mary make Wills leaving their estate equally to their children, Dan and Doreen. Dan dies before his parents do. The question is whether Janet gets Dan's share of the estate.

In Alberta, the answer is no, Janet does not get it, unless John and Mary's Wills say that she does. Most parents whose children are now adults choose to state that should one of their children die before they do, the child's children (John and Mary's grandchildren) will inherit the share that the child would have received. This is also what would happen if John and Mary did not make Wills and the estate was distributed according to intestacy laws. The general rule is that inheritance follows bloodlines, and a son-in-law or daughter-in-law is not in the bloodline.

This is the kind of issue that you should talk out with your estate planning lawyer to make sure you understand what would happen in your case. For example, if Dan and Janet have children who are under the age of 18 and who inherit money from their grandparents, the money must be held in trust until they become adults. During the time the money is in trust, it would be quite common that some amounts would pass through the hands of the surviving parent (in this case, Janet) on behalf of her children. Sometimes this is a problem for the grandparents, if, for example, Dan and Janet were divorced. If that were the case, John and Mary might not be comfortable allowing the children's money to be handled by Janet.

You can give fairly specific instructions in your Will about how trust funds are to be handled. It's always a good idea to be up front about your concerns and goals so that your lawyer can make suggestions about how to address them in your Will.