How Much Estate Planning is Enough?

As I was surfing the internet over the weekend, I came across literature on the need for society to take time to plan for the eventual transfer of their wealth from one generation to the other.  I think a good question that should be asked is how much planning is enough and what type of planning could insulate my estate from litigation?

I came across a 2013 Ontario Court decision, Park v. Park, in which the issue at hand was a contest between Sister and Brother for ownership of their parents’ home.

Mother and Father married each other in Korea during the 1950s.  Mother and Father had five children of the marriage, the eldest was the defendant, “Sister” and the youngest being the plaintiff, “Brother”.

In his evidence, the Brother indicated that he and his Parents arrived in Canada in 1982, and that his family started a doughnut shop which he worked long hours at.  The money that the family earned was pooled together and distributed by his Mother for family needs.

On November 29, 1990, Mother and Father purchased a home and title was taken in the names of Mother, Father and Brother as joint tenants.  The Brother argues that title to the Property was taken in joint tenancy with the expectation that he would eventually inherit the property.  The “family promise” that he would eventually become the owner of the home was made in recognition that he had given up his personal life for the family good.

A few weeks prior to his death Father severed the joint tenancy by a conveyance to himself as a tenant-in-common.  By his Will he left his entire estate to Sister.  Moreover, Father died after the lawsuit was commenced but before it reached conclusion.   Mother was moved to a long-term care facility and was unable to testify at the trial.

Brother wants to set aside the transfer of title in the Property so that on his Mother’s death he will become the sole owner of the property.

After lengthy evidence was taken from experts who gave their opinion on the Father’s mental health along with the Lawyer who facilitated the real estate transaction severing title to the property, the court held that the severance of the joint tenancy by the Father was a valid transfer.

The sister attempted to argue that the Brother held his share of the Property in trust for his Parents; however, the Court held that on the evidence produced it could not find that the Brother held his share of the Property in trust.

I found this case to be of interest because here we have hard working individuals who came to Canada in the 80’s with next to nothing and built a life.  They took time to plan; however, their estate was still strapped in litigation.  As I write this blog, I sit here thinking of how this could have been avoided?

Carpe diem.

Rick Bickhram – For more information on Rick Bickhram, please follow this link.