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Estate litigation often engages the rights of children, and a substitute decision-maker is frequently required to step in and represent their interests. Parents of minors may believe that role automatically falls to them, but that is not always the case. Depending on the situation, parents may not automatically be their child's substitute decision-maker, and they could even have to answer to other individuals or organizations.
What legal rights do minors have in Ontario estates?
In Ontario, a minor is anyone under the age of 18.1 Minors have restricted legal rights and responsibilities; for instance, they cannot make a power of attorney, commence legal proceedings, or directly receive an inheritance under a will.
Can parents access information about their child's trust or estate share?
It may surprise parents to learn that they are not necessarily entitled to information about their child's interest in a trust or an estate. Subject to limited exceptions, only the minor, the Office of the Children's Lawyer,2 a guardian of property, or an estate trustee/trustee is entitled to information about a minor's share of an estate or a trust. This means that a parent may be effectively shut out from the process unless they have obtained a court order specifically appointing them guardians of their child's property, which can be a lengthy and burdensome process.
How are inheritances paid to children under 18?
Typically, wills contain specific provisions directing a minor's share to be held in trust until they reach the age of majority or some other specified age.
If there is no such clause in the will, no court-appointed guardian for the minor, and the amount due to the minor is $35,000 or less, the trustee can pay the funds to a parent with whom the minor resides or a person who has lawful custody.3
The trustee can also choose to pay any amount owing to a minor into court by depositing the funds with the Accountant of the Superior Court of Justice (the "ASCJ"), who will invest the funds on the minor's behalf and pay them out upon the minor reaching the designated age. Once a trustee pays the funds into court, he or she has no further responsibility to the minor in respect of the money that has been paid in. The ASCJ will issue tax slips to the child's parent or caregiver, and any income earned on payments into court is non-taxable until the child reaches age 21.
If the child requires the funds before they reach 18, their parent or caregiver can submit a request for the money to be paid out of court through the Office of the Children's Lawyer's Minors Funds Program.
Who represents a child in estate litigation?
Because minors cannot commence legal proceedings, their interests must be represented in litigation by a litigation guardian. A child's parent can act in this capacity so long as they have no interest in the proceeding that is adverse to their child. This ensures that the litigation guardian is free from any conflict of interest between them and the minor. If there is no appropriate person to act as the minor's litigation guardian, the Children's Lawyer may take on that role.
Further, because a minor cannot sign settlement documents or provide a valid legal release, any settlement involving their interest must be approved by a judge.4
Need guidance on protecting a minor's interests in an estate?
If you are a fiduciary or a parent or caregiver who is dealing with a minor's interest in an estate or a trust, speak to our experienced Estates and Trusts Litigation Group. To ensure that your estate plan stands up to future risks and protects the minors you intend to benefit, consult the experts in our Private Client Services Group.
Footnotes
1. Section 1, Age of Majority and Accountability Act, R.S.O. 1990, c. A.7
2. The Office of the Children's Lawyer is an independent law office in the Ministry of the Attorney General that delivers justice programs on behalf of children.
3. Sections 51(1) and (1.1) of the Children's Law Reform Act, RSO 1990, c. C.12
4. Rule 7 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194
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.
