In an effort to modernize estate law practice, several amendments to Ontario's inheritance laws have recently been implemented. These changes were largely prompted by the enactment of the Accelerating Access to Justice Act, 2021, which introduced significant amendments to the Succession Law Reform Act ("SLRA"), the legislation governing inheritance matters in Ontario.
Traditionally, under intestacy rules, if a married couple lived separately and one died without a will, leaving behind only a spouse, the spouse would inherit the deceased's property outright. However, if the deceased left a spouse and one child, the spouse's entitlement would be half of the estate remaining after the payment of the spousal preferential share, currently set at $350,000. In cases with multiple children, the spouse would still receive their preferential share, with the remaining estate divided between the spouse and the deceased's children.
However, on January 1, 2022, an amendment to section 43.1 of the SLRA introduced significant changes regarding separated spouses in intestacy matters. This amendment not only exempts separated spouses from intestacy rules but also provides a comprehensive definition of what constitutes a "separated" spouse. The aim is to bring clarity and fairness to estate distribution in situations where marital relationships have broken down.
Who qualifies as a "spouse" under the SLRA?
Under the SLRA, "spouse" has the same meaning as in section 1 of the Family Law Act ("FLA").
Section 1 of the FLA defines "spouse" as two persons who:
(a) are married to each other, or
(b) have together entered into a marriage that is voidable or void, in good faith on the part of a person relying on this clause to assert any right.
According to section 43.1 of the SLRA, a spouse is considered "separated" from the deceased person at the time of their death if:
(a) Before the person's death,
i. they lived separate and apart as a result of the breakdown of their marriage for a period of three years, if the period immediately preceded the death,
ii. they entered into an agreement that is a valid separation agreement under Part IV of the Family Law Act,
iii. a court made an order with respect to their rights and obligations in the settlement of their affairs arising from the breakdown of their marriage, or
iv. a family arbitration award was made under the Arbitration Act, 1991with respect to their rights and obligations in the settlement of their affairs arising from the breakdown of their marriage; and
(b) at the time of the person's death, they were living separate and apart as a result of the breakdown of their marriage.
It's essential to note the difference between common-law spouses and married spouses regarding property rights. Unlike married spouses, common-law partners do not have the same legal treatment and do not automatically possess equivalent property rights.
By providing clarity on the treatment of separated spouses in intestacy cases and defining the term "separated" spouse, the amendment aims to promote fairness and equity in estate distribution practices. However, it also underscores the ongoing need for individuals to be aware of their legal rights and obligations, particularly in the realm of family law and estate planning.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
