BCBusiness

M C Q U A R R I E What You Need to Know About Estate Planning Trying to save money may cost you dearly in the end I t's not uncommon for peopletotry toavoid the perceived expenses associated with retaining lawyers, at least with regards to estate planning; but taking matters into one's own hands by establishing joint property ownership can ultimately be costly, as well as ruinous to relationships, according toElyssa Lockhart, partner atMcQuarrieHunter LLP. At face value, joint ownership seems attractive becauseif one owner diesit gives the last surviving joint owner title to the asset without delay. Also, "people feelthey are streamlining the legal process and saving money by taking steps to avoid the need to probate their estate," says Lockhart. However,after the death of a spouse, surviving partnersoften add one or more children as joint owners of their assets— andthat's when the trouble begins. Trouble often stems from what Lockhart refers to as diƒering "investment time horizons." She explains: "With spouses, jointure is successful because—in addition to truly being owners of the assets—you have similar life plans and lifespans; but siblingsunderstandablyhave diƒerent ˆnancial ambitions, timelines and needs." Over time, children canbecome proprietary about assets held in their names—preventing parents from selling and using them freely.Often children do not share these assets with siblings after the death of their parent, as was anticipated by the parent. And, "Jointuredassets aren't conˆned to property: they can also be vehicles, banking and certain investment accounts—a multitude of things," says Lockhart."Incidences ofproprietary behaviourseem to be increasing, and while legal steps can be taken to rectify the ˆnancial situation, litigation doesn't resolve the bitterness created within the family." The legal team atMcQuarrie, which is currently marking its50th anniversary, is especially motivated to helping clients avoid thehazards stemming from substitut- ing simple solutions forcomprehensive legal advice. "In terms of the legal landscape, the public generally does not fully appreciate its intricacies," says Lockhart. One example of something not commonly known by lay peopleisthat jointures don't necessarily save families money, even in the absence of litigation. "If you list a child who doesn't live on your property as a joint owner, it is treated as an investment in their hands and growth in value can be taxable as a capital gain—a much higher rate than the approximate 1.4-per-cent probate fee," says Lockhart. Yet more di•cultiescan result if a couple opts to draft their own wills. "So- called 'simple wills' have their own set of hazards. Instead, we strive for 'suitable wills' to best protect our clients." For example, simple wills generally don't protect step-children because, in law, a stepchild hasno claim to the estate of a step-parent. If the parent dies and leaves all assets to his or her spouse, that spouse may later disinherit the step-child with impunity. "By contrast, a will from a lawyer can be structured to acknowledge both the spouse and the child."Plus, law ˆrms such asMcQuarrietake the time to explain complicated legal processes in ˆne detail to clients, so they gain a ˆrm understanding of their obligations and theplanningstrategiesavailable to them. Lockhart concludes:"Consulting with an experienced lawyer is always the best option when you have to make important personal asset and business decisions. In the long run it saves you time and money— and possibly a lot of heartache." McQuarrie is a multi-practice, Surrey-based law rm that serves the needs of businesses, individuals and institutions in the Lower Mainland and throughout B.C. www.mcquarrie.com S P O N S O R E D C O N T E N T Elyssa Lockhart, partner at McQuarrie, says that some people feel they are stream- lining the legal process and saving money by taking steps to avoid the need to probate their estate. But sound advice can help them in the long run.

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