All About Estates

Testamentary Letter of Wishes- Part 2

In my last blog post of January 27, 2017, I discussed testamentary letters of wishes and some of the benefits and potential pitfalls of their use. For the purposes of the post, I limited the discussion to testamentary letters of wishes which are designed to convey a testator’s wishes and desires regarding the disposition of personal items after the testator’s death. This post continues the discussion.

Another “pitfall” of letters of wishes arises out of the fact that they are not legally binding. Although it imposes a strong moral obligation on the beneficiaries and executors of the estate, it should not impose (if the letter is properly and cautiously worded, as discussed in my last post) a legal obligation. The use of a letter of wishes therefore will not be appropriate in all circumstances. For example, it may be unwise for a client to prepare a letter of wishes if the beneficiaries of his or her estate have tense relationships with one another. Even if everyone gets along, if there are items of significant sentimental value that more than one beneficiary will strongly wish to receive, it will be more prudent to deal with such items in the testator’s Will, where legally binding instructions can be given. Similarly, a letter of wishes is generally not the appropriate place to convey a client’s wishes regarding items of significant monetary value.

A gift to charity should also generally be made in the Will rather than a letter of wishes. There are several reasons for this. First, the charity is usually an arm’s length third party and so the moral obligation imposed upon them by the letter of wishes is less than that which would be imposed on a loved one who knew the testator. This increases the risk of a challenge to the letter or a request that it be formally reviewed or approved in some way. Including directives to make gifts to charity in the Will may also simplify the process the charitable tax credit process.

Here are some other practical tips for drafting successful letters of wishes:

  • Just as with a direction in a Will, consider contingencies and spell them out in the letter (e.g. in the event a beneficiary predeceases the testator, is a minor when the gift is received or if there is a reason the beneficiary may be unable to use the gift).
  • Ensure that the letter contains a statement (out of an abundance of caution) that the wishes apply only to the extent that the property referred to therein is owned by the testator on the date of his death.
  • A letter of wishes can be a good opportunity to convey more personal messages to loved ones that may not be appropriate to put in a formal (and public) Will (e.g. “My purple vase to my friend, Jane Eyre, who always appreciated the simple beauty in life, if Jane Eyre is alive on the date of my death. May you it remind you of our many conversations around my dining room table.”)
  • The testator should sign and date the letter of wishes.
  • Ideally, the letter of wishes will be kept alongside the Will. The testator should ensure that the individuals appointed as his executors know of the existence of the letter and its location.
  • Be as specific as possible in describing items referred to in the letter. If there could be any doubt regarding the items, especially 10 or 20 years from now when memories are fuzzy, considering appending to the letter labelled photos of the items. Beware of using generic terms in describing items, such as “art”, “jewellery” and “china”. Also try to avoid introducing any element of interpretation (e.g. “the earrings I love to wear with my black dress”).
  • Always ask to review a client’s letter of wishes to ensure that it avoids the problems sometimes seen with letters of wishes. If not preparing the letter for the client, consider providing the client with a template letter of wishes he or she can complete. Keep a copy of the final letter of wishes on file and request that the client provide a revised version whenever updates are made.
About Katie Ionson
Katie Ionson is an Associate at Fasken Wealth Management, Charities and Not-for-Profit Group. As part of her wealth management practice, Katie assists clients with Wills, powers of attorney, trusts, marriage and domestic contracts, and trust and estate administration. She has experience using estate planning to address a variety of client objectives, including income splitting arrangements, asset protection and business succession issues. Katie is engaged in a broad practice in the areas of charities and not-for-profit law, which includes preparing applications for charitable status, assisting clients with transitioning to the new federal or provincial not-for-profit legislation, drafting endowment and gift agreements and advising on administrative and tax-related issues. Email: kionson@fasken.com

2 Comments

  1. Brian liddell

    February 27, 2017 - 2:40 pm
    Reply

    I question your suggestion that a letter of wishes be signed an dated.

    In my jurisdiction (Alberta) that could result in the letter of wishes being found to be a holographic codicil to the will and not only enforceable but also required to be submitted with the will for probate

    • Katie Ionson

      February 28, 2017 - 5:15 am
      Reply

      Hi Brian, Thank you for your comment! That a letter of wishes might meet the requirements for a testamentary document is a major potential pitfall of letters of wishes. I discussed this risk in more detail in my first blog. To avoid the possibility that a letter of wishes will meet the requirements for a valid holograph will, in addition to making very clear the testator’s intention that the letter is precatory only, one should avoid having the letter written in the testator’s handwriting. Normally, I would either prepare the letter myself or provide the client with a word template for editing. As mentioned, it is always a good idea to review and keep a final draft of the letter if the client wishes to try drafting the letter him or herself initially.

      I still suggest that letters of wishes be signed and dated by the testator. It is important that the letter is signed in order to help dispel questions as to whether the letter was truly prepared by the testator. It is important that it be dated so that the executors can confirm that it is the latest version of the letter. The date may also be important if capacity issues are raised or if there are issues surrounding the interpretation of the letter or Will.

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