A couple of months ago I discussed the purpose of the “30 day survivorship clause” in Wills.  In a nutshell, the clause is designed to address the problems that may arise in the situation where the testator and one or more beneficiaries die in a common accident or otherwise within a short period of time of each other.  By requiring a beneficiary to survive the testator by the specified period of time, the clause also covers situations where it is uncertain who died first.

But what happens in the case of simultaneous deaths where there’s an intestacy or where the Will does not contain a survivorship clause?

Legislation in each province sets out the default rules for determining the order of death in situations where two people die at the same time or in circumstances where it is uncertain who survived the other.

Two possible rules apply, depending on the province.  In Ontario the rule is that each is deemed to survive the other.  B.C., Alberta, Saskatchewan, Manitoba, Quebec and New Brunswick follow the same rule.  In the remaining provinces the youngest survives the older rule applies.  A brief example of how this works:

Bill (age 39) is married to Kate (age 41).  They have no children.  Both have assets in their own name.  In their respective Wills they leave everything to each other in the first instance.  Bill’s Will says that if Kate predeceases him, his estate goes to his mother.  Kate’s Will says that if Bill predeceases her, her estate goes to her brother and sister.  Bill and Kate perish in an avalanche and it’s uncertain who died first.

If the couple lived in Ontario, each estate would be probated and distributed as follows:  the residue of Bill’s estate would go to his mother and the residue of Kate’s estate would be paid to her siblings.  If the couple lived in Nova Scotia – a youngest survives the oldest province – the result woud be very different.  Kate the elder’s estate would be probated and the proceeds paid to Bill the younger’s estate.  Bill’s estate, including the proceeds from Kate’s estate, would be probated and the proceeds paid to his mother.

There’s one more twist to consider.  Four provinces have introduced statutory survivorship rules.  In B.C. and Saskatchewan the beneficiary must survive the testator by five days in order to inherit.  In New Brunswick the survivorship period is 10 days.  Manitoba provides for 15 days.  So, let’s say the couple lived in B.C. and Kate survived Bill by six days.  Her estate would inherit from Bill and the combined estates would be paid to her siblings.   Bill’s mom would miss the cut by a couple of days.

As the examples show, the arbitrary statutory defaults won’t always result in the fairest or most cost efficient distribution or reflect the wishes of the testator.  The best advice is to oust the arbitrary defaults by including a reasonable survivorship provision in your Will.

Gong Hey Fat Choy (or Gong Xi Fa Cai)!  Best wishes to all for a wonderful year of the Monkey!