When it is brought into force, the new British Columbia Wills, Estates and Succession Act will increase the preferential share that goes to a spouse of a person who dies without a will.
The current law, section 85 of the Estate Administration Act, provides that when someone dies without a will in British Columbia leaving a spouse and descendents, the spouse is entitled to the first $65,000 of the estate (as well as household furnishings and a life estate in the spousal home). The spouse’s portion of the rest of the estate is one-half, if the deceased left only one child or one-third if the deceased left more than one child. For the purpose of determining the spouse's share, a child who has died before his or her deceased parent is counted if that child left descendents who are living at the intestate parent's death.
Under section 21 of the Wills, Estates and Succession Law Act., the spouse’s preferential share will be increased. The amount will depend on whether the deceased’s descendents are all also the surviving spouse’s descendents or some of them are not the surviving spouse’s descendents.
If the deceased's descendents are all common descendents of both the deceased and the surviving spouse, then the spouse’s preferential share is $300,000. If some of the deceased’s descendents are not common descendents than the spouse’s preferential share is $150,000. The theory behind this is no doubt that if all of the descendents are common to both the deceased and the surviving spouse, they will most likely eventually inherit something from the surviving spouse.
The spouse’s portion of the rest of the estate under the new Act will be one-half, with the other half going to the deceased’s descendants in the manner set out in the legislation.
Let’s look at a couple of examples. Paul dies without a will leaving his wife Sarah, and their two children. His net estate (after payment of his debts and funeral expenses) consists of $400,000 of investments.
Under the current laws, Sarah would be entitled to $176,666.67 ($65,000 plus one-third of the remaining $335,000), and each of their children would be entitled to $111,666.66 (one-half of the remaining $223,333.33).
Under the Wills, Estates and Succession Act, Sarah would be entitled to $350,000 ($300,000 plus one-half of the remaining $100,000), and each of their two children will be entitled to $25,000 (one-half of the remaining $50,000).
Now let’s change the facts a little bit. Paul and Sarah have one child together, but Paul also has a child from a previous marriage. Sarah would receive $275,000 ($150,000 plus one-half of the remaining $250,000). Each of Paul’s two children would receive $62,500 (one-half of the remaining $125,000).
Under the new Act, the surviving spouse will still be entitled to the household furnishings, but there are new provisions concerning the spousal home, which I will discuss in another post.
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