"If history repeats itself, and the unexpected always happens, how incapable must Man be of learning from experience." - George Bernard Shaw.
In these monthly installments, I will review an eclectic series of legal topics that I hope to be of general interest. The legal issues discussed will be ones that can occur to anyone, and more likely than not, unexpectedly.
The first topic is that of intestacy. Intestacy is the state of dying without a will. A person is said to have "died intestate" if he or she dies without a will. If this happens, that means that the provincial government decides how your assets will be divided - and not you.
The survivors of an intestate person - often a spouse or a child - are often surprised to be in this situation. They often think that the deceased had a will or that a will was not necessary. Sometimes the intestate person dies so suddenly that a will, although planned, was never made.
The survivors of an intestate person will have to consult Probate Court in the Pictou County Justice Complex for closure of an intestate's estate and the distribution of the estate's assets. In order to manage the intestate's estate, a survivor will have to apply to be the "administrator" of such an estate. An administrator would enjoy many of the powers that an executor would have if the deceased had made a will. An administrator must post a bond to ensure that the administrator carries out his or her duties properly.
There is a statutory formula to choose an administrator, with first preference given to the intestate's spouse and/or children. Multiple administrators are possible. If there is conflict in this group as to whom should be administrator, then a court will have to decide who is appointed administrator. If an administrator is not chosen from this group, then other persons could be selected from a list set out in the Act. This list includes the public trustee, a government official appointed when there is no one higher in the list who wishes to act as an administrator. Even a creditor of an intestate could be appointed administrator.
In Nova Scotia, the spouse of a deceased intestate person collects entirely if the intestate has left no children. Asset distribution may be delayed by a number of months via the probate process unless all assets were already in joint names. Even if the intestate has left children, the spouse under Nova Scotia law gets special treatment. If the net value of the deceased's estate is less than $50,000, it all goes to the surviving spouse, regardless of whether the intestate had children or not. If the net value of the estate is greater than $50,000 and the intestate had children, the wife may elect to either have a claim on the estate for $50,000, or the home itself that includes the surrounding land and furnishings of the home. The residue of the estate is then divided 50/50 if there is a surviving spouse and one child, or one-third of the estate goes to the spouse if there are two or more children.
Even then, it is not clear-cut that the spouse will inherit. The Intestate Succession Act of Nova Scotia provides that if a spouse has left the intestate at the time of the intestate's death and is living in adultery at that time, the spouse is barred from inheriting under the Act. Although this provision is obscure, it is still the law and capable of use. This could provide incentive for litigation if the estate is large. Some potential intestacy beneficiaries might try to prove the surviving spouse was adulterous at the time of the intestate's death in order to remove the spouse from inheriting and secure their own claims on the estate.
If the intestate left no spouse or children, then the intestate’s parents stand to inherit. If no parents survive the intestate, then the intestate’s brothers and sisters inherit. If no siblings, then nephews and nieces inherit. If no nephews or nieces, the law computes inheritance based upon the degree of consanguinity (blood relatives). Grandnephews and grandnieces, grandparents, first cousins and the like are considered in order of how closely they are connected by blood to the intestate.
Another area that frequently gives potential intestacy beneficiaries' sleepless nights is the status of blended families. What happens to the intestate who dies leaving children who are illegitimate or are stepchildren from his or her spouse's prior relationships?
The Act specifically states that illegitimate children of the intestate can inherit as equally as legitimate offspring. The level of contact, care and support the intestate and the children may have shared during the intestate's lifetime is irrelevant in intestacy law.
The inheritance of children of the intestate's spouse from previous relationships, according to the Act, hinges on the Act's definition of the children of the intestate, called "issue." Issue is defined as the "lawful lineal descendants of the ancestor." So, step-children who have not been adopted by the intestate before he or she died cannot inherit on intestacy. Again, the level of contact, care and support the children and the intestate shared during the intestate's lifetime is irrelevant in intestacy law.
No matter what your family situation, intestacy takes away what you would like done with your estate and makes others the decision-makers. For your peace of mind today and your family's peace of mind tomorrow, avoid the unexpected and make a will. It's an easy, inexpensive solution.
Douglas Lloy, Q.C. is a lawyer with Nova Scotia Legal Aid, a published author and president of the Pictou County Barristers' Society.