Registering your Last Will and Testament: what’s the point?

One of the most frequent questions we receive at LegalWills is “do I have to register my Last Will and Testament somewhere in order for it to be official?” The short answer is of course, no, but we’ll spend a little time today delving into what it means to register a Will.

First, a point of clarification. We are speaking purely of registering your Will while you are alive, not the registration of a Will that happens once you have passed away, after your Will has been probated and read.

The act of registering a Will while you are alive is an attempt to overcome the problem of people not being able to find a Will when they need it. We wrote about this in a previous blog posting, and we’ve seen stats claiming that 67% of people do not know where to find their parents’ Will. It is vital that the right people can find your Will at the right time, and this is where the concept of registering the Will comes in, but in our opinion it’s a highly ineffective way of attempting to solve the problem.

No country has an official central Will registry, but let’s look at a few approaches taken by different jurisdictions that allow for the registering of a Will.

In British Columbia, you can register the location of your Will with the provincial department of vital statistics. For about $18 you can file a notice that ” identifies that a will has been registered and describes the person who has made the will, where the will is located, and the date of the will.” You cannot register the Will itself, but you can say “I have a Will and it’s at home in my bedside table”. Once you have passed away, your loved ones can contact the vital statistics department, pay $20, submit a death certificate and request a search.

In the UK it has been left to private enterprises to offer the same kind of service. Certainty.co.uk appears to be the market leader in allowing you to register the location of your Will, but again, it’s not the Will itself, but a pointer to the location of the Will, whether that be with a solicitor or a location at home. For this, the charge is £30. (although searching for the registered Will costs anything from £25 to £235!!).  However, Willdata.info also claim to be the UK National Wills registry and it never helps to have more than one national registry!! (WillData incidentally is free to register a Will, and £18.50 to search)

Some States in the US have tried to do a little more. For example, in Alaska, you can deposit a Will for safekeeping with the courts. The service is described as follows

“If you deposit your will with the court, it will be kept in a secure place, and the will is kept confidential by the court until you die. After you die, your will is no longer confidential and it becomes a public court record. Also, even though your will itself is confidential while you are living, the fact that you deposited your will for safekeeping is not confidential, and others may search electronically for the names of  people who have deposited wills.”

The fee for this service is $40. But the service comes with this reminder “It is your responsibility to be sure the designated person(s) know that upon your death they must contact the court and request your will.”

There is definitely a real issue with Wills not being located when they are needed, but the registration process seems to be a very poor effort at solving that problem. I would hazard a guess that less than 1 percent of Wills are registered, and in reality, hardly anybody has even heard of these registries. The idea of paying $20-$50 to store centrally the piece of information that states that your Will is stored at home in a cookie jar seems ridiculous, and in some cases it is little more than opportunism by private corporations.

The bottom line is that there is no requirement to register your Will centrally to make it legal and in our opinion, there is very little value in doing this. We do have a service at LegalWills that allows you to create messages for loved ones to be distributed after you have passed away, and this would seem to be as effective as any of these Will registries. We try to reinforce the practice of regularly reviewing and updating your Will so storing the document itself with a government agency would seem to be counterproductive.

By far the most effective approach is just to tell your Executor where your Will is located. You will be trusting your Executor to distribute your assets according to your wishes, and they should be told ahead of time that they have been selected for this role. So you should have enough faith in this person to let them know where your Will is stored. This should guarantee that the document will be available to the right people at the appropriate time.

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Beyond your Estate plan, what’s your legacy?

If you are a fan of crime writing and TV drama you may have a romantic notion of a Last Will and Testament being your voice from the grave. The opportunity for you to tell everybody what you really think of them and share some of your values and opinions. In reality, a Last Will and Testament is generally a clinical legal document that must be unambiguous and to the point. It has to clearly set up the roles and responsibilities of the Executor and Trustee, unequivocally lay out your wishes for the distribution of the estate, and include clear instructions for additional responsibilities like guardians for minor children. Because the document has to be completely unambiguous, it is not the most appropriate vehicle for sharing your opinions on the World and your circle of loved ones.

Having said that, it is extremely important to be able to leave a little of yourself for future generations, and now people talk about the leaving of a “legacy” beyond your estate. A legacy plan differs from an estate plan because it communicates your values, wishes and memories rather than the distribution of your possessions.

There is more connecting the Last Will and Testament to the Legacy Plan than you may at first think. You may have chosen to leave tens of thousands of pounds or dollars to a child or grandchild – a legacy plan would give you the opportunity to share with that young person the values that go along with that inheritance. If you have spent a lifetime frugally accumulating a reasonable estate, it would go against all of your principles for the recipient of an inheritance to rush out a buy a new Porsche with their new-found wealth. With an inheritance comes responsibilities and although a Will may make passing reference to the sentiment behind a bequest, it is not a place to share your moral values and explain how you would want an inheritance to be received. If for example you accumulated some money by placing every loose penny in a jar for your whole life and then investing those pennies wisely, a $2,000 inheritance may mean a little more to the recipient than a new big screen TV.

Your legacy documents should be stored with your estate planning documents and can be made up of things like a video message, letters to loved ones, a scrapbook of important events, photos, memorabilia and journals. There is a wonderful book called Your Legacy of Love by Gemini Adams that explains the importance of your legacy items with practical tips for creating a lasting legacy. The book includes the amazing statistic;

“If one of your parents died, what would you prefer: to inherit their money, or a letter saying how much they loved you?” Over 90% expressed a wish for the loving letter.

So although it is important to have your estate planning documents in place, consider complementing those documents with a description of what your estate means to you and what your loved-ones mean to you. Explain why your estate is being distributed the way you have outlined in your Will and share some of your values that should accompany any inheritance.

The Executor and Trustee – your most important appointment

We’ve raised this issue time and time again in this blog. Sadly, news articles continue to surface that describe Executors stealing the money that they should be distributing. In a previous post we referenced four cases of Trustees either helping themselves to funds, taking exorbitant fees or simply money just going missing and not being accounted for.

Over the weekend, the Globe and Mail published a feature article of one of the most egregious cases in Canada and it gave some interesting insight into the process of distributing an estate. Paul Penna had a very successful career in the mining industry, and was a generous philanthropist throughout his life. Hardly a day went by that he didn’t make some kind of charitable gesture, but even though he gave much of his money away throughout his lifetime, he died with an estate worth about $24 million. He hired a top city law firm to create his Will, but unfortunately he appointed a long-term friend and colleague, Barry Landen, to be his Executor. Mr Landon was appointed to gather up Mr Penna’s estate and distribute it according to the wishes outlined in the Will. Sadly, over the course of seven years Mr Landen helped himself to the money which should have been passed on to the charities.

The Globe and Mail article explains some of the nuances around probating a Will – the estate lawyer “said in a court affidavit that she recommended the complex will be probated, a legal process that registers a will with court officials to ensure its legality and to oversee distributions to beneficiaries. Ms. Roberts’ affidavit said Mr. Penna’s trustees declined to probate the will …By not probating the will, the estate avoided Ontario probate fees that can be exorbitant – but it also meant there was no court supervision and no assurance that the beneficiaries would be notified.”

This successful businessman and philanthropist accumulated $24 million which he bequested to charity, and where did it end up? “Most of the money ($3 Million) was used to buy and renovate a newly purchased home in Forest Hill for Mr Landen. He also charged the estate $122,000 for Raptors and Leafs tickets and special entertainment suites at the games. Another $130,000 was spent to lease five cars, including a Porsche and Mercedes.”  and “about $12-million was unaccounted for.”

At the same time another Canadian family saw their charitable bequest hijacked by a family friend they had appointed as a trustee. In 2009, the relatives of Robert and Signe McMichael discovered that the estate’s trustee, former Crown attorney Geoffrey Zimmerman, had helped himself to more than $1-million of a $5-million bequest designated for the McMichael Canadian Art Collection.

The painful lesson from these cases is that you must choose your Executor wisely. They will potentially have unfettered access to sums of money that they are not accustomed to dealing with, and although they are permitted to take a fee, it can be very tempting for some people to dip into the estate a little more than they are entitled to. If you are not sure whether you have a suitable candidate to act as Executor there are a couple of options open to you; name more than one Executor to act jointly so that all decisions have to be agreed upon, or if you feel that this arrangement could introduce its own issues, you can hire a professional. Most banks offer Estate Trustee services.

What will happen to your digital assets?

One of the most important reasons for writing your Last Will and Testament is to describe how you would like your possessions and assets to be distributed after you have passed away. There are of course other important elements to a Will, like naming a guardian for children, but for the most part, people associate the writing of a Will with providing an inheritance to friends, family and charity.

Traditionally these assets include things like a house, a car, money, possessions and heirlooms; all of these items being tangible ‘things’ that the Executor can collect and distribute – also known as “chattels” and “personal property”. Recently however there has been a growing awareness of a new type of asset that is typically not included in a Will, and that is the idea of a “digital asset”.

Just supposing that you write your Will and you leave everything to your children in equal shares. Your Executor has the responsibility to gather your estate, including your possessions and bank accounts, and then divide this estate between your children. However, there is a very high likelihood that your Executor will miss your digital assets and won’t even know that they exist. Then if they are located and accessed, it is not always clear how they can logistically be transferred to your beneficiaries.

So what would a digital asset look like? Here are a few examples;

You have some domain names that you “own” or rather continue to pay for annually that will expire. There is still a very active trade in domain names and they can be worth a lot of money. Domain names will regularly change hands for tens of thousands of dollars, but if the renewals lapse, they are worth absolutely nothing.

You may have a blog with sponsored banner ads. If you have established a loyal readership and attract significant followers to your blog, you could be generating a sizeable income from this blog. You may even be an affiliate of LegalWills generating commissions on re-directed traffic to our sites. Where will this money go?

You may have PayPal accounts, or be holding an account balance at PaddyPower or PartyPoker. What if you have a successful eTrade account? Again, these online accounts could be worth significant sums of money, but where will the money go and how will an Executor gain access to it?

Then of course, there are digital assets that may be worth less financially, but much more emotionally. Who will gain access to your Flickr, Facebook, Gmail, Twitter, iTunes and Dropbox accounts for example? It could be argued that online photo sites like Flickr are the family photo albums of the future. Not many of us now have a printed, dusty album to pass to our children. So how do we make sure that we have an ongoing family legacy.

Take for example this headline from a few weeks ago “Ottawa music critic leaves records to University” a gift of over 20,000 vinyl records and 10,000 CDs. Will this just be an iTunes account in a few years? Some iTunes accounts have several hundreds if not, thousands of dollars invested in them. Wouldn’t this have enough value to be treated like a tangible legacy?

I’m not even sure the law is keeping up with the concept of these digital assets; for example, whether a collection of potentially valuable domain names constitutes a part of the estate for probate purposes. Furthermore, in which jurisdiction is an online account even located?

I’m also not sure whether many legal professionals are recognizing the need  to include these assets as part of an estate plan – “and my Flickr account goes to my daughter Susan”.

A few businesses are cropping up to address the needs of the digital legacy, and maybe we’ll profile these in a future post. But for now, make sure that when you create your Last Will and Testament, store it with some information about your digital assets; User ID’s, passwords, and who you would want to take over your accounts. Include a note to indicate whether these accounts have any financial value. LegalWills actually has a service that allows you to create messages to be distributed after you have passed away which is ideal for this type of situation. The online equivalent of a sealed envelope, but with much greater control and security. But even if you are creating your Will with a legal professional, make sure that they are aware of the implications of your digital assets.