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Separation vs. Divorce: Is there a difference when estate planning?

estate planning May 20, 2020

When couples split up, the last thing they’re thinking is, “What happens if I die?” Breakups are emotionally difficult times, with many hard decisions. But the ramifications of a split are magnified when the parties do not go through with a divorce.

Many people think the mere act of “separating” will result in cancelling their partners in their Wills, estate plans, powers of attorney and beneficiary designations. This is not 100 percent correct.

Separation = update your documents

While a divorce changes many things, a separation does not necessarily make these changes. Anyone who is separating should immediately speak to an estate lawyer and have them review their Will, beneficiary designations and estate plan so they can confirm what will occur if they should die prior to being divorced.

During the separation process, it’s very important to update your Will, even if the updated Will is not going to be your final Will and you haven’t figured out all the details. We can always revoke this interim Will if you get back together with your separated spouse.

Worse case scenarios

The worst scenarios I have seen are the ones where a couple has been separated for decades, and then one party dies and the RRSP’s or life insurance passes to their ex-spouse because they did not change their beneficiary designation.

A second problem we see is when a person is deemed to have two spouses. While a person cannot have two legally married spouses, they could be considered to have two spouses if they are still legally married to one and living common-law with another.

We recently had a situation where a man passed away and his common-law spouse called our office looking for legal advice.  He had been married 27 years earlier but had separate from his wife after 2 years of marriage. He never filed for a divorce.  He later moved in with our client and they lived common law for 22 years.  Unfortunately, he had never changed his insurance policies and as a result, his wife of 2 years was considered to be his beneficiary and she also had dower rights in the home he had shared with his common-law partner for 22 years. A home that the first wife had never seen.  This is a very messy situation that ends up being dealt with in the court system. This takes time, costs money and can reduce the value of the estate.

If you have recently separated and need to readdress your Will and other estate planning documents, call our office today.  We can assist you in updating your documents and answer any questions you may have about your estate plan.  We are here to help!


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