What can a lawyer charge to help you with an estate?

If you hire a lawyer to look after an estate, what will it cost? It may be more complicated and possibly more expensive than you realize. The following is a note I received from a reader who is dealing with that very issue.

"I'm looking for some advice regarding legal fees in relation to the administration of my late Aunt's estate in BC. The value of the estate was just over $207,000, with the highest proportion of this sum related to the sale of her apartment. She did not leave a will and therefore died intestate with all the benefactors (including me) residing outside of Canada. While I understand that completing the administration of her affairs in such circumstances presented a number of difficulties than would otherwise be the case, I consider the fees charged by the legal firm appointed to resolve matters, which amounted to $42,000 as grossly excessive. Can you advise me of the approved formula or mechanism for calculating fees relating to estate administration?"

 

There are a few factors in play here that need to be explored. First, it's important to understand what, exactly, is included in that $42,000. And as that amounts to about 20% of the estate, I can see why you're asking.

 

There is a difference between legal fees and estate administration fees. In your case, it appears that you've had the lawyer doing both. I'll talk about this more in a moment. In addition to fees, the bill for the estate likely also includes disbursements. This refers to anything that is paid out-of-pocket by the lawyer on behalf of the estate, such as probate fees, any of your aunt's unpaid bills, taxes, accountant's fees, funeral bill and so on. This money doesn't go to the lawyer; it comes out of the estate and is paid to a third party. Your aunt's estate was administered in BC, which is one of the most expensive jurisdictions in terms of probate fees.

 

The lawyer may also have charged for disbursements in his/her own office, such as for faxes or long distance charges. In any estate where the beneficiaries all live in another country, disbursements are going to be higher.

 

And of course there is tax on all of that. Canada has goods and services tax (GST) that is charged everywhere, and in all provinces but one has a provincial sales tax added to it (together they are the HST).

 

So once you separate out the disbursements and the taxes, all of which should be carefully itemized on the lawyer's statement of account, you can see how much was actually charged in fees.

 

Now here is the kicker. There is no "approved formula or mechanism for calculating fees for estate administration" here. And even if there was, you've asked the lawyer to do much more than a simple estate administration. I can give you a few guidelines though, that you can use to judge the bill you've received.

 

Normally a lawyer will charge about 1.5% of an estate simply to obtain the probate document, or as in your case, the Letters of Administration. The actual fee is not laid down in a law. Lawyers may charge more. Whoever actually hired the lawyer should have received a quote before the lawyer started work. Quotes from lawyers may include a "job" price for a piece of work such as obtaining probate, but they may not. Most lawyers will tell you their hourly rate up front even though it's impossible to tell at the beginning how many hours the work is going to take.

 

In addition to those fees, the lawyer may charge for doing the work that an executor would normally do. While an executor normally may receive up to 5% of an estate, and more if there are complications, an executor may hire experts (such as lawyers) at the expert's normal hourly rate.

 

In addition to that, the lawyer may charge additional legal fees for additional legal work. Specifically, the selling of an apartment is not considered part of the executor's fee because the executor would have hired a lawyer and paid him/her a fee to do it. You should expect a couple of thousand dollars in fees and several disbursements for this transaction alone.

 

I hope this information helps you to understand the lawyer's bill and understand what exactly the lawyer was paid to do. If you feel that the bill is still unreasonably high, you can take steps to have it changed. Believe it or not, you can ask the lawyer to adjust the bill voluntarily. If he/she won't do that, you have the option of going through a process called taxation of account. This involves the client and the lawyer meeting with an officer of the court whose job it is to decide whether lawyers' bills are fair. Whether this would work for you when none of you is local is another matter.

 

I can see why in this case your family hired a lawyer for help. None of you lives in Canada and someone had to deal with the estate. Hiring a lawyer is definitely a good way of getting things done properly, but it's not necessarily the cheapest. There probably isn't a lot you could have done to keep the bill lower. For example, you couldn't have cleaned out the apartment yourself or taken meetings at the bank.  Somebody who lives near to the deceased could have done a lot more to control costs.

 

Another option would have been to hire a trust company, who would have done the same work for a flat fee of less than 5% of the estate (plus disbursements and tax of course).

 

Anyone hiring a lawyer to help with an estate must have a frank discussion about fees, disbursements and taxes. Don't be afraid to ask what you can do to keep a lid on the costs. Get your estimate in writing before the lawyer starts working on the estate. Another good idea is to ask for a monthly statement of fees so that you can see what is happening at each step, and what each of those steps costs.

 

 

Do lawyers tell clients to make wills so that lawyers can make more money?

Do lawyers tell clients to make wills so that lawyers can make more money? A reader asked me that question, and my answer appears below.

"I was telling my friend that if you do not have a will it is going to cost you more money than if you have one. He said this is not true that the lawyers want to make more money. (Sorry, no offence meant with this comment.)"

No offence taken. Since you have asked me a blunt question, I'm going to give you a blunt answer.

If we lawyers wanted to make more money, we'd never help anyone do a will. The real money for us is in the litigation that is caused by inadequate, invalid or incorrect wills that people make for themselves. If all we cared about was making money, we'd be urging everyone to make their own wills so that we could reap the benefits once they passed away and their families fell to fighting over the mess.

Why would we bother making someone's will for a few hundred dollars, when we could let them make their own will, then make tens of thousands of dollars on the lawsuit?

Your friend is completely mistaken. I can pretty much guarantee that he's never actually talked to a lawyer and so has no real idea what an estate planner can do for him. One day a lawyer is going to make a nice fee when he or she handles the litigation that your friend is leaving to his family.

How can an executor stay involved while the lawyer processes the paperwork?

Some executors or administrators of estates will hire a lawyer and ask that the lawyer take care of the entire estate from A to Z. More commonly though, executors and administrators want to be more involved than that. They want to keep costs low, keep the estate file moving along, and maintain control of the estate. Recently a reader in exactly that situation wrote to me, and I'm sharing the answer here.

"My father recently passed away and unfortunately does not have a will. I am trying to wrap my head around what exactly I need to do to get things straightened out. I've spoken to a lawyer and he has outlined what is required and I do need to give him some more information so that he can start the necessary process but if I am able to do some thing(s) myself, then by all means I am willing to tackle them."

There is a lot of opportunity for an executor (or, as in this case, an administrator) to take on tasks to keep legal costs low and to keep the estate file moving as efficiently as possible.

During the initial stage of the file, the lawyer will be gathering information to put together an inventory of assets and debts, as well as a list of beneficiaries and family members. You can supply a list of names, addresses and birth dates, and call around to family members to come up with information that might be missing.

You can also go through your father's house to find paperwork such as bank statements, investment statements, insurance policies, title deeds, property tax assessments, pink slips for vehicles, credit cards and bills of sale. All of these items contain vital information such as account numbers that will save the lawyer a lot of time. You can save even more time and money if you are able to go to the banks yourself to get updated statements (that isn't always possible for administrators, but it is for executors).

If there is a house, cabin or land to be sold or transferred to a beneficiary, you can save time and money by arranging to get appraisals. I recommend that you get at least two for each piece of property.

Once the lawyer interprets the law for you so that you know who is going to be a beneficiary under the intestacy laws of your province, you should notify them of what's going on. Once you have the grant of administration, you may wish to set up a day for everyone to get together and divide up the personal and household items.

Your lawyer may ask you whether you want to open an executor/administrator's bank account or have him run everything through his trust account. You can do it either way, but it's cheaper to do this yourself, unless there are beneficiaries who don't trust you to handle the funds. As an administrator (rather than executor) you won't be able to open the bank account until the court has issued you the letters of administration.

When it comes time to prepare an accounting to the beneficiaries, the lawyer should draft the Release documents. But you can save a lot of money if you prepare the statements yourself. Please understand though that you have to prepare a proper accounting that deals with all payments into the estate and payments out. If you prepare something inadequate or misleading and it ends up in court, you won't have saved any money or any time.

If you would like more of a step-by-step guide, pick up my book called Alberta Probate and Administration Kit. Even though the majority of the forms in it are for Alberta, there are also executor's accounting forms that can be used anywhere in Canada, and plenty of information, tips and ideas that apply to executors and administrators across the country.

Weak claim against the estate could cost you big time

"Gone are the days when the costs of all parties are so routinely ordered payable out of the estate that people perceive there is nothing to be lost in pursuing estate litigation". So said Ontario's Court of Appeal in the case of Smith Estate v. Rotstein earlier this year.

In that case, a woman challenged her mother's will on the basis that the deceased lacked testamentary capacity (i.e. didn't know what she was signing) and was unduly influenced into making the will. The woman's brother was the executor and was forced to defend the will. By the time the case made it through two levels of court, his legal bills were over $700,000.

The judge said that there was so little evidence supporting the woman's claim that she should never have brought the case in the first place. And if she had brought the case in good faith, she should have dropped it early on once she saw all of the evidence. However, the woman stubbornly carried on with the lawsuit, apparently thinking that the costs wouldn't matter because the estate would pay them.

She had a nasty surprise. The judge made her responsible for the brother's costs of $700,000, as well as $30,000 in disbursements. Ouch!

This should be a major heads-up to anyone who is thinking about bringing a weak lawsuit against an estate for emotional reasons. Yes, it's tempting to make the executor stop and pay attention to your issues. Yes, it's tempting to vent your emotions this way. And yes, you may even have heard that when estates end up in court, the estate pays all the lawyers. But this case makes it clear that pointless litigation just for spite won't be tolerated. The free ride for will contests is over. Unless there is strong evidence to back up your claim, don't count on the estate paying your lawyer.

Are all legal fees for an executor paid out of the estate?

I've received the following question about lawyer's fees on an estate, which I think will be useful to many readers.

"My mother is an executor of a will and the lawyer who has assisted her with the proper legal forms etc, has sent her a lengthy letter and bill stating that his fees are to be paid out of her own pocket or rather out of her executor’s fee. It has been my understanding that all professional fees regarding the estate are paid out of the estate. Am I wrong in this?"

A blanket statement that included "all professional fees regarding the estate" would in fact be wrong. Let's take a look at the general rule, and then talk about what might change the general rule.

The general rule is that the legal fees for getting probate and looking after an estate are to be paid from the estate and would not not affect any executor's pay. This would include legal advice, obtaining probate or administraiton, sending out notices, preparing Releases, etc. However, the lawyer is often asked to take on tasks over and above legal work. For example, many executors ask the lawyer to hold estate funds in the lawyer's trust account, or to hold meetings with the beneficiaries, or to prepare an accounting.

When the lawyer does tasks that are really the executor's job, such as those last three examples I gave, this is not supposed to come out of the estate, but out of the executor's fee. If the lawyer does the executor's work, why should the estate pay both the lawyer and the executor? That means the estate is paying twice for the work to be done once.

People mistakenly think that the lawyer's job is to "do the whole estate". However, that is the job of the executor, not the lawyer. The lawyer's job is to take care of the parts of an estate that pass through the legal system, such as getting probate from the courts, or dealing with any litigation. If an executor is hiring a lawyer to do other, non-lawyer things - such as selling a house or cleaning out personal possessions from the home - the executor is simply choosing to hire an agent to do the executor's own work.

In this reader's case, I think the letter and bill were probably "lengthy" because the lawyer was giving a breakdown of exactly which tasks he or she did on behalf of the estate, in an effort to explain why funds were to come out of the executor's fee.

Based on my own experience of over 25 years of dealing with wills and probate, I believe that part of the problem is a mis-communication between lawyer and client. While the lawyer may think she is being perfectly clear when she advises the executor that the estate will only cover legal fees "to do the probate", this isn't a lot of help when the executor doesn't actually know what is and isn't included in a probate.

A bigger part of the problem, of course, is that most people are only executors once in their lifetimes or twice if they are very unlucky, and they don't really know what to do or where to start.

Here are some tips for dealing with legal fees on an estate:

1.  If you hire a lawyer, discuss legal fees up front before the lawyer does any work. Ask for details about what is covered. Ask a question such as "is there anything you're going to do on this estate that will come out of my executor's fee?"

2.  Get the details of the planned legal fees in writing. In some jurisdictions in Canada, lawyers are required by the Law Society to give this to clients in writing, so it might happen automatically, but always ask for this. Then when you get the letter you can read it over to make sure you understand the arrangements.

3. A key phrase to listen for when discussing the estate with the lawyer is something like "would you like me to take care of that, or would you like to handle it yourself?" If you can do it yourself but choose to get the lawyer to do it, chances are you're paying extra.

4. If you don't have the time or the ability to do all of the required estate tasks yourself, or the beneficiaries are questioning everything you do, you may well be tempted to hire the lawyer to do the whole estate. It's a lot cheaper, and in many cases much more efficient, to hire a trust company to do that. If you bank with one of Canada's major banks, you can simply ask the manager or the banking officers to put you in touch with the bank's trust company arm. (Or call me, I'll fix you up!)

Judge says feuding siblings can pay their own lawyers if they want to keep fighting over the estate

I found this story to be one of those car wrecks where I couldn't look away, even though I knew what I was about to see was going to be ugly. It's the story of a father who left 75 million dollars to sons who couldn't get along. Five years after the father's death, the sons are still fighting over the estate and the legal bills are over five million dollars. The legal fees were being paid out of the estate until a judge got sick of these feuding siblings and told them they'd have to pay their own lawyers if they wanted to keep fighting (well done judge, I'm with you on that one). Click here to read this story, which applies to all of us even if our estates don't amount to 75 million.  The story and the attached photo are from http://www.capitalmagazine.ca/.

Can the lawyer who writes the will be an executor? How much can he charge?

The relationship between lawyers and executors is in theory pretty simple. The executor represents the estate and hires the lawyer to give legal advice and to prepare probate documents. However, in practice there is often confusion among clients, executors and beneficiaries as to the role the lawyer is supposed to play. The following question, which is really a group of separate but related questions, was sent to me some time ago by a reader. Because this reader's questions are those I hear so often in my work, I thought everyone would be interested in the answer.

The question:

Can a lawyer who writes up a will also be an executor of that will? Also, can he claim fees as both a lawyer and as the executor? And who decides how much the executor receives? If there are two executors, do they both get the same amount? Are there any limits to executor fees?

Certainly a lawyer who writes a will can be an executor of the will. There is no conflict there. However, if the lawyer who writes the will is also a beneficiary, that's a problem. Over the years I've met a handful of elderly people who are so grateful for help and attention that they have wanted to leave me something in their wills that I prepared for them. I've never accepted this, and I never will. Even if I knew for sure I hadn't influenced them in any way, the optics of the situation would be terrible.

At the time the lawyer drew up the will, he or she would have billed the client legal fees for that service. If the client later passes away and the lawyer is the executor, the lawyer can only charge executor's fees and not legal fees for the executor work.

Having said that, you must realize that an executor normally hires a lawyer to prepare probate documents, and pays the lawyer legal fees for that. If the executor is a lawyer, it is acceptable if he or she hires himself or herself (or their office, partners etc) to do that. The lawyer can charge legal fees for the probate work. This is not charging legal fees for the whole estate; I am referring to the steps involved in preparing the probate documents, filing them, going to court if necessary and obtaining the Grant of Probate.

The billing and recording of the lawyer's time on the estate might be complicated, as the lawyer is filling two roles. The executor's rate of pay and the lawyer's rate of pay are likely quite different, and will be billed and paid at different times.

As for who decides how much the executor receives, I wish more people addressed this in their wills. If there is an amount or a percentage stated in the will, that is how much the executor will get. The will rules. The majority of wills, though, don't say anything about executor's fees. When nothing is said in the will, the executor calculates how much he or she thinks is appropriate, based on time spent, complications (missing beneficiaries, overseas beneficiaries, missing assets, etc), size of the estate (bigger estate = more responsibility), number of beneficiaries, any losses the executor may have caused to the estate, and similar factors.

The executor asks for this amount by including it in his or her final accounting that is presented to the residuary beneficiaries at the end of the estate. If the beneficiaries agree, they sign off and the executor [ays himself or herself out of the estate.

If the beneficiaries don't agree, and believe me they frequently don't, they can attempt to negotiate the fee with the executor. If that is unsuccessful, the amount of executor fees must be set by a judge. Keep in mind that no beneficiaries can be paid their shares until this question is resolved, because nobody will know what the judge is going to decide.

There are limits on how much an executor can charge (where there is no guidance in the will). Each province and territory has a Trustee Act that says something about fees, but in many areas it only refers to a "fair and reasonable fee", which is certainly open to interpretation. The courts have dealt with this frequently and clearly, and the range of "fair and reasonable" is interpreted as between 1% and 5% of an estate.

The final question is whether two executors split a fee equally. Yes, they split the fee, but the split should only be equal if the amount of work done by them was approximately equal.

Answering two Alberta-specific questions

Two different readers have recently asked me questions about things specifically relating to Alberta, so I'm answering them both here.

Firstly, the form you use to put a Notice to Creditors and Claimants in the newspaper (in Alberta only) is called Form NC34, and is found in the Surrogate Rules. I'm attaching a link here that you can follow to get the form. You'll have to scroll about halfway down; the forms are in numerical order.

Also make sure you read Rule 38 which governs how and when to publish the notice, as follows:

38(1)  If a personal representative publishes a notice to claimants, the personal representative must do so in accordance with this rule and may use Form NC 34.

(2)  A notice to claimants must be published in a newspaper

             (a)    that is published or circulated in the area where the deceased usually lived, or

             (b)    if the deceased did not usually live in Alberta, that is published or circulated in the area where a significant amount of the deceased’s property is situated.

(3)  A notice to claimants must be published,

            (a)    in the case of an estate with a gross value of $100 000 or less, at least once, or

            (b)    in the case of an estate with a gross value of more than $100 000, at least twice with 5 days or more between the publications.

AR 130/95 s38;135/96;165/2010

The second question was about how much a lawyer charges to file for probate in Alberta. The general rule set down about 15 years ago is that lawyers will charge $2,250 plus .5% of the estate where the estate is valued at no more than $150,000. Where the estate is valued at more than that, the lawyer will charge $2,250 plus 1% of the estate. This charge is for what are known as core legal services, or the services that are normally required on any estate, including applying for probate. If the lawyer does any of the work that is normally done by the executor (the non-core legal services), the lawyer will charge his or her usual hourly rate.

Not all lawyers follow this general guideline, nor is it required that they do. It's always a good idea to discuss fees and disbursements in the first meeting with any professional before you ask them to do any work for you.

(By the way, both of these questions and many others are covered in my upcoming book, the Alberta Probate Kit).

Questions to ask your estate planning attorney

This article gives some advice on how to find the right lawyer for you when you want to do your estate planning. It's American, which is why it refers to "attorney" and not "lawyer", but the advice given is certainly applicable to everyone. Click here to read it.

Executor's fees, lawyer's fees or both?

Today I'd like to answer another excellent question from a reader that I think will be of interest to many of you. The question is:

"Can a lawyer who writes up a will also be an executor of that will? Also, can he claim fees as both a lawyer and as the executor? And who decides how much the executor receives? If there are two executors, do they both get the same amount? Are there any limits to executor fees? Thanks."

Yes, a lawyer who writes up a will can be the executor, though he should not witness the will if he is named as executor.

At the time the will is drawn, the lawyer will claim his usual fee for writing the will. Later, when the testator passes away and the lawyer acts as executor, he will claim an executor's fee, which would be the same as a non-lawyer would claim. The lawyer would only be able to claim a lawyer's fee on top of that if he did legal work for the estate that would have needed a lawyer in any event. For example, if a lawyer would have been hired to file for probate anyway, then the lawyer/executor (or his firm) can do that work and charge the usual lawyer's rate for that work.

When a lawyer or accountant is named as an executor, it's a good idea to include a clause in the will that specifically addresses the fact that they can be paid professional rates for professional work and not for their entire executorship. The lawyer and the accountant should already know what they can charge, but the other people involved in the will might not know.

If the will states how much an executor is to be paid, then that is how much the executor will receive. Occasionally the amount is set out in dollars, but usually it's expressed as a percentage of the estate. Unfortunately, plenty of wills don't address executor's fees.

If the will doesn't address executor's fees, the executor must fall back on the statute law and case law for guidance. Executor fees vary from province to province, though there are usually only general guidelines to follow. Estates vary widely, depending on the kind of assets, the value of assets, the number and location of beneficiaries, whether there are claims or difficulties, the expertise of the executor and a hundred other things. As a general rule, an executor is able to claim between 1% and 5% of an estate, with only the more complicated estates reaching the top of that range.

The amount the executor receives - within the range mentioned - is normally determined by the residuary beneficiaries of the estate. During the final accounting for the estate, when the executor is ready to cut the cheques to the beneficiaries, the executor should put forth in writing a proposal of the fees he or she wants to claim. The beneficiaries are asked to approve the estate accounting including the proposed executor's fee.

If the residuary beneficiaries think the fee is too high (and quite often that's the case) then the executor and the beneficiaries may be able to negotiate a sum that's satisfactory to everyone.

If they can't agree, the executor's fee must be set by the court. This involves a hearing in courtroom. The estate can't be distributed to the beneficiaries until that has happened because the fee may be set higher or lower than the executor had requested.

If there is more than one executor named, the fee is expected to be split among them. It's not always an equal split. Sometimes one executor has taken on more of the work because of geography, time or skill. The executors should work out between themselves how they are going to split the fee, and if they simply can't agree, it has to be decided by a judge.

Your first meeting with the estate lawyer - what to bring, what to expect

Many times an executor has come to his or her first meeting with me loaded down with a cardboard box (or two) crammed full of papers. The explanation is always that the executor didn't know what to bring, so he or she brought everything. That makes sense, but somehow it still ended up that I needed things the executor hadn't brought along. This post is intended to make that first meeting between an executor (or administrator) and the estate lawyer run a little more smoothly.

What to bring:

• paper and pen for taking notes
• 2 pieces of I.D.
• the original will
• a Death Certificate and/or Funeral Director's Statement of Death
• the deceased's I.D.
• the deceased's social insurance number
• the most recent statements from the deceased's bank accounts, investments, RRSPs, RRIFs, TFSAs, LIRAs, DRIPs, loans and lines of credit
• the deceased's last tax return
• if the deceased was paying child support, a copy of the order or agreement to pay the support
• copy of the deceased's life insurance policies
• names and addresses of all beneficiaries named in the will
• names and addresses of the deceased's spouse and children
• the birthdates of any beneficiaries who are minors
• copy of title to the deceased's real estate, or the tax notice for the property

What to talk about:

• a timeline for individual tasks, and for the estate as a whole
• what the lawyer is going to do for you
• which tasks you are going to do yourself
• who the lawyer represents and will speak with
• who is entitled to see a copy of the will
• any possible claims on the estate
• what to do about personal effects in the deceased's home
• what and when the lawyer will charge for fees and disbursements
• paying the lawyer from the estate
• any further paperwork the lawyer needs from you
• any immediate need for cash for the deceased's spouse
• payment of the funeral bill
• opening an executor's bank account
• any of the deceased's assets that are in danger of being lost or damaged
• what to do if the deceased's house is now vacant
• whether you will claim executor's compensation, and if so, when and how much

Make sure before you leave the lawyer's office that you are clear on exactly what you have to do next to keep the estate moving. Open a binder or accordion file to keep estate documents, lists and statements organized.

Does a lawyer charge to release an original Will?

When an executor is going to apply to the court to probate a Will, he or she must have the original Will of the deceased. People are encouraged to store their Wills in logical places so that the Wills can be found (I've been involved in estates where original Wills have been found stuffed inside the headboard of a bed, rolled up in an empty shaving cream can, or placed under the ice cube tray in the freezer. Gotta love people's quirks!). One of the popular places to keep an original Will is at the office of the lawyer who drew up the Will.

Assuming that the testator of the Will has died and his executor has tracked the Will to the lawyer's office, the executor has the right to request that the original Will be handed over to him. The executor will have to show his identification to prove that he really is the person named in the Will, and he'll have to sign a receipt for the Will as well.

I've been asked whether in this situation, the lawyer storing the Will will charge a fee to the executor.

If at the time the Will is handed over, the lawyer sits down with the executor and reviews the Will, and gives the executor some advice on how to handle the estate, of course he or she will likely charge for that. While some firms offer a free half-hour consultation on certain types of files, that practice is by no means universal and no executor should assume that he or she is going to get free legal advice.

Advice aside, will there be a fee? There is no standard practice in place for lawyers everywhere. I've worked for three of the city's larger law firms and one trust company, and none of them charged a fee for this. If the lawyer or her staff tell the executor that there is a fee, the executor should ask exactly what the fee is for. Documents prepared for clients, including Wills, belong to the client. In the case of an executor who steps into the shoes of a deceased client, the Will must be turned over to the executor. Therefore there shouldn't be a fee simply for giving the document to its rightful owner.

Perhaps a fee would be in place for storage of the Will in the law firm's premises. I find it unlikely that a law firm charging for storage would allow years to go by without sending a bill to the client and plan to collect its fee only when the client has died. That just doesn't seem like much of a business model. So any fee for storage should be small.

Paying even a small a fee at this stage of an estate can be problematic. Obviously if the executor is only at the point of getting possession of the Will, he or she doesn't yet have access to any estate assets to use to pay any bills. If the executor is unwilling or unable to pay the charge himself, other arrangements might have to be made. I don't think that would be much of a problem. The executor could, for example, agree to include any outstanding fee on the inventory of the estate, and pay it at the same time other estate debts are paid. Or, if the executor has a lawyer, the lawyer could request the Will and undertake to include the fee on the estate inventory.

Tax deductible legal fees on an estate?

The legal fees paid to settle an estate are usually not tax-deductible, but read this article from All About Estates to find out when they might be tax-deductible. For a tax article, it's very readable!

Cowboy will writers in the UK: Save now and pay later?

In the UK there is apparently a will-writing industry, with non-lawyers in the business of writing wills for people. Usually the customers who use these businesses do so because they are trying to save money, as these businesses are cheaper than lawyers. Apparently there is a reason why they are cheaper, and this article from Diane A. Vieria explains how customers are running into serious problems. We don't have independent will-writers here, but this article really does show how dangerous they can be.

What should I expect from an estate-planning meeting?

So, you've got an appointment coming up with a Will-planning lawyer and you're wondering what exactly you're in for. What will be covered in that first meeting? Will there have to be more than one meeting? Will the lawyer want other people to get involved? In this post, I'm going to talk about what you should expect.





First of all, the lawyer should be someone whose personality clicks with yours on a business level. You should feel at ease, and feel that you can speak freely without being judged. You should feel that the lawyer listened to you and understood your priorities. I remember once going to a doctor I didn't know, only because mine was on vacation, and I disliked the new doctor as soon as he opened his mouth. He was short-tempered and sarcastic. I would never consult him again. You don't necessarily have to become personal friends with your lawyer, but on the other hand, it shouldn't be unpleasant when you spend time with him or her either.





You should also have confidence that the lawyer you're working with has experience in this area of law. If you want to ask how long the lawyer has been practicing or how many Wills he or she writes in a year, go ahead. But even without asking those questions, you should feel that the lawyer spoke with confidence and gave you solid advice.





I've noticed that many people are very reluctant to get second opinions on legal matters, even though it's commonly done for medical issues. If you absolutely cannot accept what the lawyer is telling you, or think he or she is wrong, simply say that you're not ready to have the lawyer do any work for you until you've had a second opinion elsewhere. Someone said that to me once and it didn't hurt my feelings!





If you are a senior and are being brought to the meeting by a caregiver or one of your children, you should expect the lawyer to want to see you alone. This is a way of protecting you, and is not an insult to the person who brought you to the meeting.





You should expect your lawyer to come up with ideas and solutions. Present your situation factually, then tell the lawyer what you want to achieve (e.g. protection for minor children), and possibly what you want to avoid (e.g. excessive taxation). Once in a while clients come to see me with everything pre-planned and basically try to dictate a Will to me. That won't work with an experienced lawyer. The lawyer is supposed to bring his or her experience and knowledge to the table and use his/her judgment to come up with ideas that work for you. That's what you're paying for. You should hear ideas that you hadn't thought of yourself. You should find yourself thinking, "I didn't know that". You should be able to talk through the pros and cons of any ideas you might have thought of, so that you and the lawyer can evaluate it for effectiveness.





The lawyer should be able to put you in touch with other professionals that you may need during the estate-planning process, such as accountants, financial advisors and insurance representatives.





If your estate is not overly complicated, you may well be able to leave the first meeting with the estate plan completely outlined between you and the lawyer. If things are more complicated, it may take more than one meeting.





You should expect the lawyer to tell you what it is going to cost to draft your Will and incapacity documents, as well as anything else required (e.g. trust deed). The lawyer should indicate how much the fees will be, as well as whether there are any disbursements. Disbursements are things the lawyer pays for out of pocket, such as a corporate registry search, or something the lawyer charges for per unit, such as photocopying.

As with any dealings with your lawyer, you should expect him or her to keep your matters completely confidential, even if the lawyer knows your kids or your neighbours or business associates. Your lawyer shouldn't mention your estate planning to anyone without your authorization.

Finally, you should leave the meeting with a clear idea of who is doing what as the next step. If there are things the lawyer asked you to do or to find out, you should have them in a list. You should have an idea of what happens next, and when you should expect it to happen.

Will writers taking thousands from customers

This is an article from the UK about companies - non-lawyers - who write Wills for people for a fee. We don't have this system in Canada. Even the banks (which are also briefly mentioned in this article) in Canada send each and every client out to a private lawyer who doesn't work for the bank, for the customer's protection.

According to a BBC investigation cited in this article, these companies, which are not regulated, are ripping off customers to the tune of thousands of pounds. This situation is exactly why I worry about people who want Wills but don't want to pay a lawyer. I've seen individuals ask people who have never been trained in Wills law - legal secretaries, law students, accountants, financial advisors, police officers - to make them a Will because they think it will be cheaper. As these poor people in the UK are finding out, it most definitely is not cheaper, and it will be your loved ones left behind who pay the price.

Click here to read the article.

What do lawyers charge to make Wills?

In their June 2010 edition, Canadian Lawyer magazine has presented the results of a survey of law firms across Canada to find out what lawyers are charging clients to prepare their documents. While the survey covers several kinds of fees from criminal defense work to intellectual property, I'm going to focus just on the fees for Wills and Powers of Attorney (in other words I'm picking and choosing from the data). The link to the digital edition of the magazine is here, but you will need an email address to access it so I'm not sure if everyone can actually see the article.

Ontario:
fees to do a simple will range from $278 to $510
fees to do a complex will range from $704 to $2,061
fees to do a power of attorney range from $108 to $219

Western Canada:
fees to do a simple will range from $242 to $508
fees to do a complex will range from $538 to $1,520
fees to do a power of attorney range from $124 to $251

Atlantic Canada and Quebec:
fees to do a simple will range from $215 to $642
fees to do a complex will range from $662 to $2,100
fees to do a power of attorney range from $137 to $338

It's also interesting to compare the average cost nationally by the size of the law firm:
simple will by a firm having 1-4 lawyers: average $294
simple will by a firm having 5-25 lawyers: average $413
simple will by a firm having 26+ lawyers: average $489

complex will by a firm having 1-4 lawyers: average $751
complex will by a firm having 5-25 lawyers: average $1,147
complex will by a firm having 26+ lawyers: average $1,520

I still sometimes hear people, who apparently have sticker shock when they are quoted a price by a lawyer, saying things like "I can get a Will from the lawyer down the street for $100". Seriously, the days of $100 Wills are over. You might as well do it yourself as pay the person who charges $100. The real value of a lawyer when preparing your Will is the advice that you get on trusts, taxes and executorship, and the peace of mind that your family is protected.