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This section is set up as a Most Frequently Asked Questions format. Have a look at the question list, and click on them to find the answers straight from Brad!

If your specific question isn't answered here, feel free to mail a brief question to Brad, and he'll respond as soon as he has a moment. There is a link here and one at the bottom of this page.
 
                                                           

                                                                                                                       

                                                                                              



1. HOW TO BEAT PROBATE FEES

QUESTION: With all the publicity about Probate Fees, I'm wondering if I should be putting my children's names on all my assets. That way, when I die, it will go directly to them without the government getting its bit.

Tax Fighter

Dear Tax Fighter,
The government is pretty good at getting "its bit". Sometimes trying to avoid tax can leave you outsmarting yourself.

Suppose you decide to put little Johnny on the deed to your house. Yes, when you pass away, you will avoid the Probate Fee, but have you thought about the following?

1. You won't be able to sell or mortgage your property without his consent. If you need to get your money out, you better hope you're still getting on with Johnny!

2. If Johnny gets sued or into a family dispute, his creditors or spouse may argue that his half of the house is one of Johnny's assets that should be used to pay his debts or settle his divorce.

3. If Johnny doesn't live there, its not his principal residence for tax purposes. If the two of you sell it, he may be responsible for capital gains taxes on his half of any increase in value since he went on title.

4. If you are getting a Senior's Tax Rebate on your property taxes, technically that would be canceled on Johnny's half - unless he's a senior, too!

5. If Johnny goes bankrupt, or has to rely on Welfare or a Disability Pension, it is possible that the authorities would require him to sell his share of your home.

WOW! All these problems to think about just because you want to avoid a Probate Fee that really isn't so much anyway. For example, Probate Fees on a $100,000.00 estate are $1,375.00.

REMEMBER, Your own circumstances are unique and, perhaps for some, the transfer is a good idea, but proceed carefully.....you might just outsmart yourself instead of the government!



2. HOW TO BEAT LAWYERS' FEES

QUESTION: Legal fees seem so high sometimes. Once you start paying, it seems you don't have any idea where it will all end. I want to save. Can I safely do my own will? Or a sale of my cottage?

Cheapskate

Dear Cheapskate,
You may think that, as a lawyer, I'm somewhat biased, but I think that even legal fees can be good value. This is particularly true of the two examples you use.....a will and a simple sale.

Yes, it's conceivable that you could do it yourself, but most people cannot. Some can fix their cars, but most of us can't and would be better off if we decided not to try and end up in a worse mess.

Being a Country Lawyer, I often have to deal with "homemade wills". I remember one where a fine old gentleman wrote that "my house and contents goes to my wife and everything else to my son". He probably felt that he had done his will successfully and saved $100.00 in legal fees.

The problem was that he kept his money in a jar in the kitchen. Naturally his wife thought it was "contents" and his son thought it was part of "everything else". What the old gentleman thought, no one knows. His family had to get different lawyers, and each spent much more than had been saved by a "homemade will".

A property sale is even more complex and trying to do it yourself may be like deciding to fix your Jaguar yourself. Most cottage sales would be completed by a lawyer for $500-$600.00.

You're right that on other matters legal fees can seem to grow and grow. As I tell my clients, lawyers don't sell shoes or groceries. We sell time. When it comes to litigation, it is often impossible to tell how much time a case will take. Hence the dreaded hourly rate, perhaps up to $200.00 an hour.

For the most part, I prefer to send litigation clients on to an expert. We are often asked to stay involved on a consulting basis, just to be sure that everything continues on track and at a fair price.

Even if the final bill can't be determined, you are entitled to an estimate, and to know how far in you are at any one time.


3. I DON'T HAVE MUCH. DO I NEED A WILL AND A POWER OF ATTORNEY?

QUESTION: I just live on a pension in a rental apartment. I don't really have much. Do I need a Will and Power of Attorney?

Senior Citizen

Dear Senior Citizen,
YES.

One of the best gifts you can give to your family, is to take a little time to make things easier after you are gone or unable to handle your affairs.

Even if you don't have many assets, there will be matters to look after when you're gone. Your executor is the person you pick and designate in your will to arrange for your funeral, to receive and distribute your personal items and your final cheques.

If, as you grow older, you become unable to handle your financial matters, it is important that you have chosen the person you want to do it for you. The person you pick in your "Financial Power of Attorney" will then be in charge. If you don't have a Power of Attorney, the Government, through the Public Trustee, will become involved, or your family will have to go to Court to get permission to take the job on.

Death is one of the two famous inevitabilities. Do you want to be kept alive on a machine or let go mercifully? You may wish to put a "Living Will" provision in your "Personal Care Power of Attorney", to let your family know your thoughts. Believe me, they will be glad to know how you feel on this issue, instead of being left wondering if they did the right thing.


4. WHAT IS WITH THIS TWO PAGE DOCUMENT MY REAL ESTATE AGENT WANTS ME TO SIGN WITH ALL SORTS OF QUESTIONS ABOUT MY HOUSE? 

QUESTION: I have listed my house for sale. The real estate agent, a great person, wants me to complete and sign a document that outlines a whole lot of information about my house. Most of the questions I don't understand and alot of the information being asked is unfamiliar to me. My agent said that without the document, the chance of getting a decent offer on my house is greatly reduced. What should I do?
 
Yours truly,
Confused but want to sell
 
Dear Confused, etc.:
Well, as you saw on the document, you are giving alot of information about your house to anyone interested in giving you and offer to purchase the property. You should speak to your lawyer before signing any document associated with the sale of your property. I cannot stress that enough although it rarely, if ever, happens. 
As for the document, you fill it out as best you can. You are providing the purchaser with ammunition to use against you if there turns out to be a problem with the house after the purchaser becomes the owner. You are also giving your real estate agent ammunition to use against you because there is now a record of what information you provided about the property to the agent. 
If you complete such a document, PLEASE make reference to it in the Offer (or Agreement) and specify that it is not intended to be relied upon by the purchaser. Yes, there is a statement to that effect on the document; however, most purchasers won't pay attention to it there and will, if questioned in court, likely say that they did not see it and no one told them about it. 
In order to have your liability for any statement you made about the property properly limited, bring it to everyone's attention directly in the Offer (or Agreement). While that may even not be 100% effective, at least it is a good indication of your intention and your efforts to inform the purchaser. As well, the purchaser has to sign the Offer (or Agreement). The purchaser does not have to sign the information document. Usually, we are held to what we sign.   
There is a bit of a controversy about that document. Check out comments and articles written by Bob Aaron, a well respected Toronto area real estate lawyer, at www.aaron.ca

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