Joint Asset Planning Kit

The Joint Asset Planning Kit

Joint Asset Planning Kit

NOTE: Financial and Estate Planners and Advisors receive a discount on bulk orders of the kits. Please call 1-877-439-3999 to find out more.

The Joint Assest Planning Kit™ is subject to a license agreement. (click here for a full copy of the licence ). You may purchase the Joint Asset Planning Kit™ to distribute to an individual client as long as the seal is not broken
before delivery to the client.

Advisors Get Dragged into Disputes over Joint Assets

Have any of your client’s set up joint accounts with their kids?  That’s the question investment advisors should be asking themselves in the wake of recent Supreme Court of Canada’s decisions on the issue.

If the answer is yes, welcome to the messy and destructive world of estate disputes.

The country’s highest court, whose decisions are only rendered in the most important cases, has handed down two decisions that legal experts claim have dramatically changed the law regarding how joint accounts are dealt with on death.

The Supreme Court, recognizing “the widespread use” of joint accounts for many Canadians, had to decide whether joint accounts held between a parent and a child should automatically flow to the surviving child or to the parent’s estate when the parent dies.

“Disputes over joint accounts are one of the most common we see” says Jordan Atin, an estate litigator with Hull & Hull LLP and Chair of the Ontario Bar Association Estates Section.  In a common scenario, a parent puts one of her adult children on as a joint owner of a bank account or investment account.  When the parent dies, that child expects to receive the account for himself, while the other children expect that account to be divided equally as part of the Will.

Who is right?  That depends on what the parent intended when the account was made joint, says Atin.   The problem is, of course, that the parent’s clear intention is rarely documented and with the parent gone, it becomes hard to prove one way or another. Often, the financial advisor is dragged into the dispute as a witness to the parent’s intention.

Historically, the law presumed that if a parent put one of his assets into joint names with a child, that parent intended to make a gift to that child.  In legal terms this was called the presumption of “Advancement”.  The asset would only be divided as part of the parent’s Will if the parent’s other beneficiaries could prove that no gift was intended.

According to Atin, that position has been reversed by the Supreme Court of Canada. Now, the presumption is that a parent intended joint assets held between that parent and an adult child are to be divided in accordance with the parent’s Will as part of his or her estate.   This presumption of “Resulting Trust” now applies throughout Canada where an asset is held joint between a parent and his or her adult child.  In the case of minor children or spouses, the presumption of Advancement still appears to apply.

However, if the intention of the parent is clear, that intention still governs what will happen to the joint account.

Don’t the account forms that parents sign indicating “joint with right of survivorship” prove that the parent wanted the asset to go to the surviving child?  Not according to the Supreme Court of Canada.   Those forms document the relationship between the financial institution and the client. They don’t necessarily prove the parent’s intention. 

Clearly documenting the parent’s intention is the key, confirms Atin.  “Without a doubt, written evidence from the parent confirming her intention quickly ends most of these disputes.  The problem is that most parents don’t write down anything, never mind addressing all of the factors set out by the Supreme Court.” 

Lawyer Barry Fish thinks he has an answer. Barry Fish and his partner, Les Kotzer have devised a simple Kit that parents can use to document their intention and cut off these disputes before they happen.   The Supreme Court of Canada reviewed a whole list of factors that taken together can prove a parent’s intention in Court.  That makes documenting the intention that much more difficult.  Fish says his kit addresses those issues.  “We carefully reviewed the Supreme Court’s decisions and tailored the documents accordingly.” 

Called the “Joint Asset Planning Kit”, the parent fills in the details of the jointly held assets and signs the form.   There are separate forms depending on what the parent’s intentions are.  Those kits can be ordered online at www.jointasset.com or directly from Fish’s office at 1-877-439-3999. 
Isn’t Atin afraid that these kits will put him out of business?  The kit may end disputes over joint assets but, Atin jokes, “there is always something for kids to fight about”.

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