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Estates & Wills & Trusts

The nightmare of retaining estate planning documents

Like most of her estate-planning colleagues, Toronto wills and estates lawyer Mary Wahbi retains the originals of clients’ wills — encompassing wills and other estate planning documents, such as powers of attorney — in a “vault,” she writes in The Lawyers Daily.

In addition to the wills she has prepared, Wahbi has also inherited those prepared by retired or deceased partners.

“This practice may have started when will drafting was a 'loss leader' — with lawyers charging nominal fees for the will in the hope of getting the more lucrative estate administration work,” writes Wahbi, a partner with Fogler Rubinoff LLP. “Given the degree of technical skill required and exposure to liability in drafting wills, that approach has fallen by the wayside and retention is generally provided as a courtesy to clients.”

Retention by the lawyer ensures the safekeeping of these important documents against destruction, loss or other potential disasters, such as handwritten changes by clients on their original documents, but it also imposes onerous obligations on the lawyer, Wahbi writes.

“Section 3.5-2 of the Rules of Professional Conduct requires the lawyer to 'care for the client’s property as a careful and prudent owner would when dealing with like property,'" she says.

The article notes that according to the Law Society of Upper Canada’s Guide to Retention and Destruction of Closed Client Files, lawyers should store the documents in a safe, fireproof and locked facility, and should maintain an accurate and current record of the documents stored for clients.

“The guide also notes that if lawyers wish to retire or close down their practice, they are required to advise their clients in writing and seek instructions to transfer the documents to another lawyer or deliver them to the clients,” Wahbi writes.

If a retiring lawyer is unable to obtain instructions from a client, the documents can be transferred to another lawyer, who must preserve the documents in accordance with s. 3.5 of the Rules of Professional Conduct, she says.

“In the alternative, the lawyer can retain custody of the client’s documents in compliance with s. 3.5. The lawyer is also required under the guide to notify the law society in writing of the location of the documents and send a letter to the client’s last known address advising of same,” Wahbi writes.

Finally, original wills may be deposited for safekeeping with the Superior Court of Justice, she says.

“This service only applies to wills or codicils, and is only available to a lawyer who has custody of a will or codicil at the time of retirement, a lawyer’s estate trustee if the lawyer had custody of the will or codicil at the time of the lawyer’s death, a person authorized by the testator in writing to deposit the will or codicil, or the testator. The current cost is $25.”

If none of the above options is available, Wahbi says the retention obligation may not be indefinite.

“Although the law is not clear, it may be limited to somewhere between 100 and 125 years after the will was executed!” she writes.

There may be additional obligations that lawyers face, Wahbi says.

“Does the retention of original wills impose an obligation to read the obituary pages to determine if the client has died? Is there an obligation to inform the client of developments in tax law and estate law, or to learn of changes in the client’s financial or family circumstances? The law is not clear,” she writes.

While the quagmire persists for stored wills of clients who cannot be located, Wahbi questions the best practices to adopt going forward, short of ceasing to store original wills.

“Consider discussing the nature and extent of these services with clients and providing for a method to terminate the retention. Obtain from the client a document in which the client acknowledges the following:

  • Documents that are being stored.
  • The storage is at the client’s request.
  • There is no duty on the lawyer to check the obituaries.
  • There is no duty on the lawyer to keep a client advised of changes in tax or estate laws.
  • There is a duty on the client to advise the estate trustees or attorneys about the location of documents being stored with the lawyer.
  • There is a duty on the client to keep the lawyer apprised of changes in address and contact information.
  • There is a duty on the client to advise the lawyer if estate-planning documents have been replaced and to arrange to pick up stored documents from the lawyer or instruct them to destroy originals.
  • If the lawyer retires or leaves the practice of law, documents may be transferred to another lawyer and the requirement to communicate with the client will be met by a general notice to will clients on the firm’s website.
  • The issue of termination of retention should be addressed with the client, including what kind of notice is to be provided and by whom, the fallback treatment if the client can't be located and when the document can be destroyed.

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