Mutual Wills

Although not common, mutual wills between spouses are being increasingly used in blended family. If two spouses make identical (mirror) wills leaving their respective estates to each other, after the first spouse dies the surviving spouse can change their will as they please. This gives the surviving spouse flexibility moving forward with their life and is often not contentious when the only children involved are children of both spouses. However, in blended families, this can prove problematic and lead to litigation. Disputes can arise over whether or not the wills entered into were mirror wills or mutual wills and, if found to be mutual wills, how the assets of the surviving spouse are used during their life time.

In order for a will to be a mutual will it must include terms that create an enforceable contract between the two will makers. Both spouse must give consideration as regards the disposition of their assets. The agreement must be clear and unambiguous. Finally, the wills must include terms that prevent the spouses from changing or revoking their wills without the express consent of the other.

Beneficiaries do not have to wait until the second spouse dies before they can commence legal action to prove that a will is a mutual will. Actions taken by the surviving spouse that are not consistent with the terms of the mutual will can be cause for litigation. Often, the first step in that litigation is to prove that the wills in question are mutual wills. If you are a secondary beneficiary of a mutual will it will be important to seek legal advice if the surviving spouse is disposing of or gifts major assets in a manner not consistent with the mutual wills.

If the court determines that the wills are not mutual wills and are only mirror wills, then the surviving spouse is under no legal obligation to follow the terms of their own will and has the right to alter and change their own will in the future.

If two spouses make mutual wills, disputes can arise between the surviving spouse and the future beneficiaries. The future beneficiaries may be concerned that the surviving spouse is depleting or disposing of assets that will detract from the former’s inheritance. Depleting assets for necessities during the life time of the surviving spouse is less likely to be deemed inappropriate and in contravention of the mutual will then disposing of substantial aspects of the estate to preferred beneficiaries.

Whether or not these steps are appropriate for a surviving spouse to be engaging in will often depend on the terms of the mutual will. Mutual wills can contain stewardship clauses that dictate what a spouse can and cannot do with certain assets during their life in order to prevent the assets from being depleting or disposed of. If the surviving spouse goes against these stewardship clauses they are in breach of the mutual wills and litigation can be commenced by the future beneficiaries to enforce the terms of the mutual wills.

If there is not clear stewardship clauses the courts will have to consider if they think the disposition is meant to defeat the true intention of the mutual wills. This is a subjective test that the court will have to engage in and different interpretations are possible.

If you are the surviving spouse of a mutual will it is important to understand the obligations imposed upon you by the mutual will and seek advice regarding the terms of the mutual will before altering or disposing of any significant assets.

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