How to avoid problems stemming from contested wills

Inheritance disputes have the potential to tear families apart.

When parents pass away without a clear and well-organized estate plan, even close-knit siblings can find themselves at odds. In Canada, messy inheritances are increasingly common as family structures become more complex and the value of estates grows, particularly due to rising real estate prices and investment wealth. Failing to plan properly can lead to confusion, resentment and even legal battles between children—outcomes that can permanently fracture family relationships.

Here’s how a messy inheritance can strain family ties and steps you can take to prevent it:

How a messy inheritance can create conflict:

Unclear or outdated wills--If your will is unclear or hasn’t been updated to reflect changes in your financial situation or family structure, it can create confusion about how assets should be divided. Disagreements over what you “would have wanted” can quickly escalate into accusations and fractured relationships. For example, if one child receives a larger share of the estate because of an outdated will that didn’t account for financial support given during your lifetime, other siblings may feel slighted.

Unequal distributions--While it’s your right to divide your estate however you see fit, unequal treatment between children is a common source of inheritance disputes. Even if you have valid reasons for leaving more to one child—such as additional caregiving support or financial need—unequal distributions can be seen as favouritism. That can lead to feelings of betrayal and accusations of manipulation, especially if one sibling had more involvement in helping manage your finances or care decisions late in life.

Joint ownership and beneficiary designations--Assets like joint bank accounts, real estate and life insurance policies that bypass the will and go directly to a named beneficiary can cause confusion and conflict. If one child is named as a joint owner or sole beneficiary of an account, other siblings may feel excluded or believe that the decision was influenced by unfair circumstances.

Family business or real estate--Inheriting a family business or shared real estate adds another layer of complexity. If one child wants to keep a property while another wants to sell, or if a business is left to one sibling without compensation to the others, disputes can arise over valuation and fairness.

Steps to prevent a messy inheritance:

1. Create a clear and updated will

A professionally prepared and regularly updated will is the foundation of a well-organized estate plan. Work with an estate lawyer to ensure your will reflects your current financial situation and family dynamics. Be clear about how assets should be divided and address specific items like family heirlooms or properties to avoid ambiguity.

2. Communicate your intentions openly

One of the most effective ways to prevent conflict is to have an open conversation with your children about your inheritance plans. Explain why you’ve made certain decisions, especially if you’re planning an unequal distribution. Transparency can help prevent misunderstandings and reduce feelings of resentment later on. Document those discussions.

3. Use trusts to avoid probate and conflict

Trusts can be a useful tool to manage complex assets and protect your estate from disputes. A trust allows you to outline specific terms for how assets are distributed, reducing the chances of siblings arguing over intent. Trusts also help avoid probate, which can be time-consuming and expose your estate to legal challenges.

4. Appoint a neutral executor

Appointing one of your children as the executor of your estate can create power imbalances and spark resentment among siblings. Consider appointing a neutral third party, such as a lawyer or trust company, to oversee the distribution of your estateas that helps avoid conflicts over perceived bias.

5. Handle joint ownership carefully
If you hold assets in joint ownership with one child, be clear about why you’ve structured it that way and how it will impact the overall estate distribution. In some cases, it may be more straightforward to divide assets equally in the will rather than relying on joint ownership arrangements that could bypass the will entirely.

6. Review beneficiary designations

Accounts like RRSPs, TFSAs and life insurance policies are not governed by your will but instead pass directly to the named beneficiary. Make sure your beneficiary designations align with your broader estate plan to avoid conflicts and misunderstandings.

7. Consider professional mediation

If tensions between siblings are already brewing, involving a professional mediator before you pass away can help resolve disagreements and establish a path forward. Mediation allows everyone to voice concerns and helps you make adjustments to your estate plan that reflect the needs and expectations of your family.

The bottom line is messy inheritance can strain even the strongest sibling relationships, sometimes beyond repair. But with careful planning, clear communication, and professional guidance, you can minimize the chances of conflict and ensure that your legacy brings your family together rather than driving them apart.

Taking the time to organize your estate properly is one of the most valuable gifts you can leave your children and one that will protect not only your financial legacy but also the relationships that matter most.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.