In addition to purchasing a first home, the birth of a child is another momentous life event that often spurs people to prepare a will. Expecting parents and parents of young children are usually keen to put wills in place in order to ensure that if something happens to them, their children will be cared and provided for. While many parents are aware that this planning includes appointing guardians of their minor children in their wills, they may not fully understand these appointments or the considerations that should go into making them.
It's first helpful to understand that a minor child's finances and property are dealt with separately from a minor child's custody and personal care--two discrete areas of responsibility in Ontario. Ontario's Children's Law Reform Act governs both areas and in this blog we will focus solely on custody.
The statute provides a limited right to the person "entitled to custody of a child" (usually one or both natural or adoptive parents) to appoint in his or her will a "custodian" for the child (in this blog post, we use the colloquially familiar term "guardian"). The right is limited because the appointment only applies if no other person is entitled to custody of the child at the date of the parent's death, and it is only effective for 90 days from the date of the parent's death. On or before the expiry of this 90-day period, a court application can be made for a permanent custody order.
Although guardianship appointments in wills do not create long-term legal rights for a child's custody, the parents' expression of their wishes on this issue is important. The written expression of the parents' preferred choice of guardian in their wills can be persuasive evidence for a court that is asked to determine a child's permanent custody. This evidence is particularly important if a custody dispute arises after the death of the child's parents.
A person who has limited 90-day custody through a will or who has been granted permanent custody by a court has the same rights and responsibilities as a natural parent and must exercise those rights and responsibilities in the child's best interests.
Aside from the operation and effect of the legal rules, what other related considerations should parents take into account when preparing wills and making guardianship appointments? Here are a few:
1. Parents should ensure that they each appoint the same people in their respective wills. Under Ontario law, if both parents die simultaneously in a common accident, only those appointments naming the same people in both wills will be legally effective.
2. Parents should discuss the appointments with the intended guardians. Acting as a guardian carries great responsibility. Further, guardianship appointments in wills are only effective if the persons appointed consent to act.
3. Should only one person be appointed alone or instead together with their spouse? What if the couple were to separate or divorce? Or the family member you intended to have primary responsibility dies? Providing temporary legal custody of the child to a former family member could result. Each situation will be different in terms of what is appropriate and desirable.
4. If the will contains a trust for a minor child, it may also be wise for parents to include specific provisions and guidance for the trustee to make certain discretionary payments from the child's trust to the guardian for expenses the guardian incurs in caring for the child to minimize the financial burden on the guardian. Payments could be for such purposes as off-setting the guardian's increased household expenses, or for reasonable expenses associated with remodelling the guardian's residence to accommodate the child or purchasing a new vehicle in order to properly care for the child.
5. Parents may consider preparing a separate "Letter of Wishes", which would be addressed to the appointed guardians and set out guidelines regarding their children's care and upbringing, touching on such matters as philosophy for raising children, family values, religion, education, dating, marriage, career advice, extracurricular activities and hobbies, as well as the parents' goals and wishes for their children.
Once new wills containing guardianship appointments have been signed, it is important to periodically revisit and review them to ensure they are updated when necessary. For example, children's changing needs as they grow up may call for the appointment of different people. The personal circumstances of the named guardian(s) can also change. Relocating to different parts of the world for work, illness, starting their own family, the effects of aging--all are factors that can affect the appropriateness of someone being named as a guardian in a will.
Please watch for our next post which will consider the topic of over-complexity in estate planning.
The comments offered in this article are meant to be general in nature, are limited to the law of Ontario, Canada, and are not intended to provide legal or tax advice on any individual situation. Before taking any action involving your individual situation, you should seek legal advice to ensure it is appropriate to your personal circumstances.