Executive Summary
Since the risk of controlling private properties increases with age as death continues to be inevitable, many individuals, who have properties, live in fear of dying intestate. The most appropriate and legally accepted modern way of avoiding intestacy is through the writing of formal wills and testamentary trusts to accord certain responsibilities and property ownership to trustees and executors. Whereas individuals find it lawful and appropriate to leave a will stipulating ownership conditions and trustees to take charge of executing a will, sometimes a will may deem void if the testator failed to consider some important issues in will writing. Therefore, this term paper seeks to assess a written testamentary trust or rather a will by a Canadian estate owner Mr. Albert Peter Cross with a view of highlighting the major issues that may affect probation of the will in a court.
The will contains seven important sections that Peter Cross states his wishes and desires regarding the execution of the will. Whereas writing a will is becoming a common practice among families as an important end of life decision-making process that halts future controversies regarding a privately owned property, it is never a straightforward task. The written will of Peter Cross has important stipulations, but some contradict each other and even legal dilemmas regarding regulations governing the testamentary trusts. Testator of the proclaimed will in the first place has been writing wills previously and his first clause aims at the revocation of the previous wills. The ultimate written will revokes the previous wills of Peter, but circumstances and justifiable reasons for such revocations remain unknown as no part indicates the reason for the physical act to revoke the past wills.
Although the will is a legal document that is flawless, certain issues in the will may generate legal implications when the executors and trustees underestimate or ignore certain principles. Although Peter selects the two original trustees and executors without any coercion, the powers bestowed to the trustees and executors in the will may result to unprecedented problems. Peter appoints two original trustees and gives them equal powers over the decisions regarding partnerships, hiring and firing of new trustees and employees of the estate company. The further appointed trustees shall also have equal powers over operations of the estate company, and in such cases, the possibility of the will attracting serious legal implications due to personal interests is high. Whereas the will in itself may contain appropriately organized clauses that exhaust almost everything require for future progress of the estate company lies on the credibility of the appointed trustees.
With equal powers bestowed to the trustees in terms of management of operational activities, human resource management practices and control financial issues of the estate company, some ethical issues may protract from the written will. First, it is possible that the trustees will develop conflict of personal interests in the maintenance of the estate company at any of the legally appointed trustee or executor, shares equal estate management powers as per the stipulations of the will. The power to make decisions about the operations of the estate company remains shared equally upon the two willfully selected trustees, and even other trustees and executors appointed by the main trustees. The chain of appointing trustees may increase as the estate expands, and the possibility of management crisis between the trustees and the other appointed, as they share equal powers, authorities and discretions about the estate operations. Moreover, evidence to indicate the mental fitness of the testator lacks in the will, and thus attracts legal and ethical dilemmas.
Introduction
Family property ownership has been a critical social and economic issue that appears on regular public discourse across the American communities. Inheritance of family property has been a common tradition and customary practice in many of the American families that understand the importance of investing for their future generation (Garb & Wood, 2010). Existing individuals can take ownership of a property of the departed. At old age or following health implications, private property owners normally experience challenges in making decisions about whom to entrust to inherit the property. On the verge of death, many Americans remain worried about the future of their property and the possibilities of occurrence of ownership controversies between the living family members (Garb & Wood, 2010). Departing individuals normally fear dying intestate and writing a will becomes appropriate for them. In the American federal and customary laws, it is common that most of the American families have the practice of writing wills and testaments regarding the legal inheritance and ownership of their property.
The writing of wills or testaments is a process that involves the property owner (testator) engaging on a documentation of a legal credence to state wishes on who to entrust to own the property in case of death, physical or psychological incapacitation (Garb & Wood, 2010). The person that the deceased entrusts to take ownership or partial charge on the property is the trustee or personal representative and is normally responsive for further decision-making process over the property. The trustee of the will is the legal owner of the assets and remains legally bound to manage the assets as per the wishes and credence issues of the deceased through the will (Garb & Wood, 2010). The entrusted owners are mainly spouse, children, or relatives of the deceased individual who follow the will with the help of the mentioned legal will executor. Prior to the departure of the owner, the trustee or personal representative to departed takes responsibilities over the operations and major decisions regarding the described property.
While it is important for individuals not to die intestate and leave a will that gives credence to certain entrusted individuals to take property ownership, wills have not been a final solution concerning inheritance and property ownership (Garb & Wood, 2010). Wills and testaments are trusts that contain legal and ethical implications that normally arise between entrusted inheritors or families taking the ownership of a property of a testator. Trusts in a will are normally the legal arrangements that can provide guidelines towards flexible ownership of the mentioned asset or property under inheritance arrangements (Garb & Wood, 2010). Will involves several trust agreements and declarations that all parties involved in the will must adhere and execute in accordance to the wishes and directives that the initial property owner presented (Garb & Wood, 2010). Trusts normally require members involved in the will agreements to ensure that they adhere to all stipulated conditions in the will regarding trustees, executors, beneficiaries and the conditions regarding the inherited property.
Purpose of the Will Term Paper
Whereas several deceased individuals have left wills and testamentary trusts regarding the subsequent ownership of their properly and some living to practice the same, it is viable that wills and testaments on property ownership provoke ethical and legal dilemmas. The living fear among individuals not to die intestate and engage in testamentary trusts and wills to give proper credence and incredible flexibility for property or asset ownership is genuine and legal, but still not a culmination towards property inheritance crisis. During development of a will or testamentary trust, the testator has the willpower, without any coercion, to decide the trustees, the executor and the proper beneficiaries. The state of the testator, the arrangements that the testator makes in the will, the desired ownership regulations, and the relationship between trustees, normally provoke ethical quandaries in several wills. This term paper seeks to analyze major legal dilemmas in the will with certain stipulations and provides a business reality regarding the testamentary provided.
Term Paper Methodology
Generally, the term paper involves an assessment of a written will, and the possible ethical and legal implications that are likely to rise in the designed will. The will documents that Peter Cross as the testator, willfully writes to provide legal credence of property ownership to his two estate trustees is the primary source of data to analyze ethical and legal implications that often arise in wills. Secondary sources of data to enrich the arguments of this term paper will involve legal journals associated with Canadian legislations, and prior case scenarios that involve unveiled implications regarding wills of similar kinds. In analyzing issues regarding the will and implications involved in the documented will, the term paper begins creating a problem scenario that directly involves the parties mentioned in the will. It is possible that despite wills and testamentary trust being legal documents that have certain legal arrangements, the trustees, or beneficiaries may act in contrast to the agreed legal arrangements.
The Will and the Presumed Case Scenario
Still alive, Albert Peter Cross (the testator) develops an ownership will of his property and willingly chooses two family members whom he entrusts to take ownership of his assets and properties in case of death or any form of incapacitation. Peter Cross entrusts his own daughter, Linda Lalonde, to be the foremost trustee and executor of his will. Incase Linda Lalonde does not agree, unwilling to act on his behalf, or stay alive to inherit the mentioned property, his grandson Mathew Lalonde will be the executor in the written will. Due to the condition of the property involved in the inheritance arrangements, Peter Cross refers the two trustees as estate trustees. Peter gives the two foremost estate trustees equal executive powers regarding appointment, property selling, asset retention, and in managing several operations of the estate company. The possible scenario that may cause attrition is conflict of personal interests in the management and operations of the estate company.
Description and Explanations of the Will Clauses
Clause 1: Will Revocation
As identified in the Canadian legislations about wills and testamentary trusts, Peter Cross wrote a living will, which is often revocable on legal terms. Peter Cross explains that prior to developing the recent will all the previously written wills have undergone revocation. This meant that the recent will that Peter Cross has written is the will that will serve his final ambitions and anticipations regarding his property ownership. The Canadian wills and testamentary making regulations require property owners to revoke or cancel completely any previously written will, when in the process of making a new will regarding the same private properties or assets. Despite the number of properties or assets a testator may own, each property has only one validly and legally accepted will or testamentary trust. The Canadian law bestows legal power to property owners to revoke wills when are willing to, at any time of their survival so long as the revocation does not breach legal norms governing wills.
Although any surviving testator has the legal mandate to revoke a will through a subsequent codicil that trustees and executors were executing validly, certain consequences may hamper the process of will revocation (Spenceley, 2009). One important lifetime circumstance involving the testator that impels revocation of a valid will is a change in family circumstances mostly including divorce cases. Before mentioning the daughter as the trustee, the testator does indicate the main circumstance that led to his decision to revoke the other written will. Canadian laws claim that a valid revocation of a will must have justifiable reasons (Northcott & Wilson, 2008). Since the testator does not explicitly state the convincing situations that led to the revocation of the previous wills, the present will may become controversial, leading to intervention of law to term it void. From a personal view, the process behind revocation of the precious wills is unclear and despite the testator managing to produce a new will on the same property, there are no justifiable reasons stated.
Clause 2: Singular/Plural/ Gender
The clause in the will explains about the gender elements that may involve the group of persons involved in the written will. The testator in this clause wanted to distinguish the masculinity and femininity of the trustees, executors or even the beneficiaries of the property mentioned in the will. The testator clarifies that the plural and singular words may be used interchangeably, especially when referring to the trustees and executors of the written will. The main intent of the clause is to help in legal interpretation of the will when certain circumstances in the processed will force the intervention of the courts and Canadian law. Generally, the clause is important in expressing the existing relationship between the trustees and the executors as the will involves future probability of having various actors on the same will. Critically, the writings on the clause seem complicated and uneasy to interpret what the testator wanted to express, hence in the absence of the testator, may become misinterpreted in law.
Clause 3: Executor and Trustee
The third clause involves the chosen trustees and executors of the written will, which the testator refers as the estate trustees. Peter Cross as the testator and the property owner willfully appoints his daughter Lind Lalonde as the main trustee and executor of the will. The testator also appoints his grandson Mathew Lalonde to act as the trustee or the executor when Linda Lalonde is unable, unwilling, dead, or incapacitated to be competent to execute the written will. When the will is under probation, the testator required an appointment of another estate trustee without any performance bond to execute the will. The testator gives credence to the original trustees to appoint an executor or trustee appropriately deemed imperative in overseeing the operations of the company. The testator requires the original trustees to appoint one or more trustees, through the deed of appointment as deemed appropriate, to help any of the original executors or trustees to carry out the will.
Any legal testamentary trust willfully written by the original property owner must have a mentioned trustee and/or executors that the testator wishes to entrust the property ownership (Northcott & Wilson, 2008). Any testamentary trust left without a mentioned trustee or executor becomes a legal matter where the court processes will lawfully appoint the trustee. The main implication is that the testator bestows powers upon the original trustees to appoint without any interruption, one or more executors, and trustees were deemed appropriate (Spenceley, 2009).). Peter originally appoints two estate trustees and gives them equal willpower on the execution of the will and further bestows equal power to the original trustees to appoint more trustees when appropriate. The will itself requires the appointed executors and trustees to have equal powers, authorities, and discretions with the appointers, who are the original trustees (Northcott & Wilson, 2008). From a critical perspective, conflict of interest may affect decision-making process for the estate company as multiple trustees with equal autonomy may have divided intentions.
Clause 4: Authority of the Estate Trustees
The clause presents information regarding the division of power between the selected estate trustees in the testamentary trust. The testator in this clause provides conditions of power upon the estate property involved in the designed will. Regarding the powers of investment, the testator gives his trustees the discretion to develop any investment they deem appropriate, except those that the Canadian law has unauthorized. The testator states that none of the trustees shall account for any unexpected loss following attempts to invest benevolently. On the authority over selling and disposing of the estate property, the testator gives the trustees equal powers upon individual wish, to sell or dispose any of his investments at any given time and any desired manner. On matters regarding retention of assets, the testator allowed the estate trustees to retain the estate assets or investment any form deemed appropriate prior to his death unless the law requires them to invest trust monies.
In any manner discreetly considered appropriate, the testator allowed the estate trustees to locate or distribute any of the estate property in specie while considering the future expectations related to such assets or investment. The testator bestowed equal powers to the estate trustees to select, hire, fire and even compensate employees, managers and corporation of the estate investment. The testator also gave the trustees the power to lease any of the estate investments in any form considered appropriate, receive rental money, and spend it in any manner they may consider constructive be it for repairs and maintenance or making further investments. The trustees also had discretion over settlement of claims, securities/shares, handling elections and other estate related transactions. The Canadian law does not exempt anyone or any investment from government taxation, whether on a will or still under the management of the original owner. Direct powers on financial matters, elections, and issues regarding taxation are granting the executors mandate to directly deal with the property and may frustrate the beneficiaries.
Clause 5: Rewards to the Estate Trustees
The clause in the will intends to demonstrate the rewards, debts, and gifts offered to the estate trustees by the testator, or any of the important parties involved in the will. In debts and death taxes, the will allows the trustees to use the estate capital in settling any pending debts, including payable income taxes, funeral expenses, testamentary costs, inheritance, and other legal expenses prior to his death, during his death and after his death. The trustees shall pay out of the estate capital any beneficiary mentioned in the will, named in an insurance policy or mentioned in a contractual agreement. In conversion of the testator’s assets, the property owner allowed the trustees under the appropriate absolute discretion of their powers, to hold the testator’s asset on the due date of his death without any liability for loss. Concerning real property ownership, if the testator to death owns property municipally known as 174 Abbotsford Road in Ottawa, estate trustees shall transfer the ownership to his surviving daughter.
The estate trustees shall pay a compensatory sum of $100,000 to his son Steven Cross following such transfer terms. For issues concerning personal property the estate trustees shall share upon all legal documents of personal and household items, automobiles, and other valuable accessories in accordance with a designed memorandum to accompany the will. If the memorandum misses, the trustees should transfer the ownership of such assets to the surviving daughter, Linda Lalonde. Finally, the estate trustees shall divide the remaining assets of the estate property. The trustees shall equally divide the remainder of the property to the daughter, Linda Lalonde, and grandson, Steven Cross, if still surviving after the demise of Peter. If none of the children persist and die before the testator, the law shall assume they still survive purposely for dividing their shares accredited by the lefty will. The provisions of this clause means that the testator wishes to clarify on inheritance benefits to the trustees and beneficiaries.
Clearance about possible rewarding strategies in the will may not be enough to reduce attritions between successors of the testator. The Canadian laws do not exempt any individual or taxable private property from tax, but does not normally impose direct estate taxes (Garb & Wood, 2010). The federal law of Canada advocates for disposal of capital assets of testators immediately after their death. On disposal, the beneficiaries and the trustees may disagree of the percentage of taxable capital, terms of paying the taxes, debts and who would incur the payable taxes upon distribution of the property (Garb & Wood, 2010). While the testator afford to leave a testamentary regarding division of rewards and gifts to authorized trustees and beneficiaries, the Canadian law may question such inter-vivo gifts prior to the demise of the property owner. The Canadian federal law explicitly claims that a reward or gift is only valid if prior to rewarding under justifiable evidence
Three important things determine legitimacy of a gift; the testator must have been aware of the related present effects, the beneficiary must receive the gift, and the beneficiary must accept the property as a gift (Garb & Wood, 2010). It was not indicative whether the beneficiaries and the trustees accepted the offered gifts. Unless the law finds it genuine that the testator was in sound mind, the gifts in the will may remain invalid (Garb & Wood, 2010). Roads are among Canadian public property and every property developed within the cities and towns by the Canadian federal governments lies under the authority of local or national authorities. Transfer of properties such as roads, which are likely to be under the ownership of the Canadian government in any lawful will may deem ineffectual as the practice breaches the federal stipulations. It would deem uneasy for the daughter to find it lawful in acquiring the174 Abbotsford Road in Ottawa as the testator may not have proper jurisdiction over the ownership of the road.
Clause 6 and 7: Payment for Minors and Exclusions
The testator states that if any minor person is to receive shares, the will requires the trustees to retain the shares in the investment until when the minor attains the required age. The testator also authorizes the trustees to make justifiable payments for any beneficiary considered minor through the loco parentis arrangements, especially either the parent or the guardian of the minor. Regarding the exclusion of the net family property, the testator states that the net income expects capital gains from the interests offered to the beneficiary shall remain excluded from the net salary of the family property owned by the specific beneficiary. Pursuant to the amended stipulations of the family law act of 1990, the income from the interests gathered from a property passed to a beneficiary shall remain excluded in case of a divorce case, death, or separation. The stipulations probate the earlier legal mandates offered to the trustees and beneficiaries regarding property distribution, ownership, and beneficence.
Conclusion
Majority of enlightened people constantly fear to die in intestacy and leave multimillion business operations in jeopardy and affected by controversies among inheritors. Although the use of wills has become a common legal practice that reduce such unforeseen problems about property ownership, a formal will itself may contain problems if proper measures of probating the wills and testamentary trusts are not in place. Writing a proper will requires an understanding of legal stipulations governing a nation, state, region, or any federation about property ownership and inheritance.
References
Cross, A. (2013). This is the Last Will and Testament. Notes, 1-7.
Garb, L., & Wood, J. (2010). International Succession. New York: Oxford University Press.
Northcott, H., & Wilson D. (2008). Dying and Death in Canada. Toronto: University of Toronto Press.
Spenceley, R. (2009). The Estate Planner’s Handbook. Ontario: CCH Canadian Limited.