The Society of Trust and Estate Practitioners is the leading international organization for trust and estate professionals.
Friday, March 22, 2019
SEARCH:
 
Education
Is the STEP Assessment by Exam for you?

Courses covering the major areas of estate planning expertise:

  • Law of Trusts
  • Taxation of Trusts & Estates
  • Wills, Trust & Estate Administration
  • Trust & Estate Planning

GET STARTED

Assessment by Essay

The approved list of essay topics includes topics from five subject areas:
  1. Law
  2. Accounts and Administration
  3. Tax
  4. International
  5. Incapacity
You may choose one topic from any of the five subject areas. In order to complete the program, you must have passed three essays from any three of the five subject areas. You may NOT write multiple essays on the same subject area.

There are two cut-off dates for marking: October 1 and May 1. Each essay should between 2,500 to 3,000 words in length, not including footnotes or references.

These topics are effective for any essays submitted in 2019.
A Law
A6 Exculpatory clauses are often found in wills and trusts. Discuss the nature and scope of such clauses, the reasons for the use of such clauses, their effectiveness and the typical language used in drafting them with suggestions for improvements and advice concerning common errors or pitfalls. Include comments with respect to the criteria that courts have applied in determining the validity of such a clause in particular circumstances, referring to case law and doctrine.
A7 Whether or not an individual had capacity to execute estate planning documents can be a sticky issue. What factors would a Court consider in a challenge to a Will and POA on the grounds that the testator/grantor did not have capacity to execute the documents? How can a practitioner help to ensure that capacity will not be successfully challenged in relation to these documents? Finally, how would you advise a client who is acting as POA for an individual who has lost capacity as far as what estate planning options are open to the incapable person?
A8 From time to time, questions arise concerning the interpretation of one or more provisions in a Will. Describe, using examples from jurisprudence, the general principles or rules of construction (in Quebec, rules of interpretation) that courts use to determine the meaning of a Will. In your description, include an analysis of the type(s) of evidence that can be admitted to court to assist the court in determining the meaning of the Will.
A9 [Common Law Jurisdictions] Although "testamentary freedom" is often used to describe the scope of a testator's ability to make a Will, the reality is that there are certain limitations imposed by law on that freedom. Describe, using examples from jurisprudence and/or statute, the limits that exist on a testator's freedom to make a Will that disposes of his or her estate as he or she sees fit.

[Quebec- Civil Law] Although "testamentary freedom" is often used to describe the scope of a testator's ability to make a Will, the reality is that there are certain limitations imposed by law on that freedom. Describe, using examples from jurisprudence and/or the CCQ, limits that exist on a testator's freedom to make a Will that disposes of his or her estate as he or she sees fit.
A10 [Common Law Jurisdictions Only] Estate planning for parents may involve either or both outright inter vivos gifts to one or more children and gifts of real property and personal assets jointly with right of survivorship. In some cases, following the death of the parent, a child who did not receive such gifts or who was not made a joint owner, will challenge the inter vivos gift or the joint with right of survivorship result. Describe each of the following methods for challenging such non-testamentary estate planning:
  1. that the joint tenancy was severed,
  2. that the outright gift was never effectively made, and
  3. that the parent was unduly influenced in making the outright gift or the gift of real or personal property jointly with right of survivorship
In your answer, please include a description of the legal principles or elements involved in each of the methods (e.g., what is required at law to effect a severance of a joint tenancy, what are the elements of a gift, and what is required to prove undue influence).
A11 [Common Law Jurisdictions Only] From time to time, a parent will "promise" to give a child or another individual real property on the parent's death. However, when the parent dies, his or her Will does not actually provide for the gift of the property "as promised". Is there any remedy available to the child to obtain the "promised" property? If so, describe the remedy as well as how and when it might apply.
B Accounts and Administration
B4 In order for a trust relationship to work, it must be continuously administered until fully executed. The administration of a trust is generally the responsibility of the trustee, and a valid trust will not fail for lack of a trustee. But what if a trustee, after accepting the role of trustee, dies, is unwilling or unable to act, or simply wishes to retire from the trusteeship? Describe, citing jurisprudence and statute, the methods by which a trustee in your province can be removed or replaced, and issues that might be relevant when considering the removal, resignation or appointment of trustees.
B5 Acting as a personal representative (liquidator in Quebec) or trustee can involve substantial time and effort, as well as incurring potential costs. Those who are appointed as personal representatives (liquidators in Quebec) and trustees will likely want to be reimbursed for any expenses or costs they incur in and about the administration of the estate or trust, and they may also decide that they should be compensated for their efforts.
Can personal representatives (liquidators in Quebec) and trustees be reimbursed for costs and expenses associated with administering the estate or trust? Can they be paid for the work they perform in administering the estate or trust? If so, what considerations or parameters are involved? In your essay, include a discussion of the following:
  1. What authority, if any, allows personal representatives (liquidators in Quebec) and trustees to pay or be reimbursed for costs and expenses incurred in their administration of estates or trusts? Are there any limitations concerning such payment or reimbursement? Are there any special considerations concerning litigation costs, tax preparation costs, and/or preparation of accounts costs?
  2. What authority, if any, allows personal representatives (liquidators in Quebec) and trustees to be paid for the work they do in administering estates or trusts? If personal representatives (liquidators in Quebec) and trustees can get paid, how is the compensation determined? Are there any limits to how much a personal representative (liquidator in Quebec) or trustee may charge or receive as compensation? Can compensation be reduced, and if so, why or how?
  3. Can a settlor or testator predetermine the compensation that a personal representative (liquidator in Quebec) or trustee will receive? If so, how?
  4. Are there any special considerations concerning compensation that affect successor executors or trustees?
B6 Corporate shares often comprise the investments of a trust. From time to time, those shares will result in the trustee-shareholder receiving a distribution from the corporation, either in the form of money or shares (either of the corporation itself or of another corporation). An issue can arise as to how to account for such corporate distributions - are they allocated to income or to capital? Where the trust has both income and capital beneficiaries, improper allocation can result in criticism, and potential litigation. Using examples from jurisprudence and/or statute, describe the various types of distributions that corporations may make and the rules for determining the proper allocation of such corporate distributions. Include in your discussion distributions that occur as part of a corporation's "spin off" transaction.
C Taxation
C4 Charitable gift planning can be an effective tax planning tool both during a person's life time and on death. Provide an overview of the tax implications associated with charitable giving in Canada both during an individual's lifetime and on death. Also describe the strategies and the related tax considerations that arise with respect to such charitable giving strategies including but not limited to outright gifts to charities, gifts of publicly listed securities, Charitable Remainder Trusts, residual interest gifts, gifts of life insurance and bequests on death through a will or joint partner/alter ego trust.
C5 Registered plans (RRSPs, RRIFs, RESPs, TFSAs, and/or RDSPs) play an important role in both the financial and estate planning of many Canadians. Describe the tax treatment of three of the aforementioned types of registered plans on death, in the context of different family situations (first marriages, blended families from second (or subsequent) marriages, families with no children, same-sex marriages, etc.). In your discussion, please identify any estate planning opportunities for minimizing tax consequences for those same three registered plans.
C6 Increasingly, estates contain unique assets, which must be administered post death of the testator. These unique assets can bring with them unique tax consequences. Highlight and discuss the taxation of capital property upon death of a testator, making specific reference to relevant income tax act provisions. Analyze in detail the taxation of unique estate assets, such as, but not limited to, artwork, jewelry, music, wine, guns, etc. Address the tax consequences of owning these assets in single form versus owning multiple (i.e. collection) of the asset. Lastly, discuss the tax consequences, and related practical administration, of disposing by way of charitable gift, either (select one) ecological property or certified cultural property.
D INTERNATIONAL ISSUES
D3 Trust issues requiring resolution often fall into one of the following three categories: (i) essential validity; (ii) construction (substantive interpretation); or (iii) administration. Where the trust relationship has elements involving multiple jurisdictions, a resolution of these trust aspects will involve conflict of laws. Using jurisprudence and any relevant academic authorities or statute(s), describe these "aspects" of a trust and discuss how a Canadian provincial court determines the law that applies to each of them (i.e., what are the rules for determining the relevant governing law for each "aspect"). In your essay, consider the "proper law" of a trust and discuss whether more than one jurisdiction's law (whether another province or country) can apply to a trust (or an aspect of it), and whether the applicable law(s), once determined, can change? Also, include in your essay a discussion of clauses relating to governing law and jurisdiction in trust agreements.
D4 Beneficiaries of a testator's estate are not always located in the same jurisdiction as where the testator was domiciled. Likewise, such beneficiaries are not always adults and some may be minor children domiciled in a foreign jurisdiction. Consider and provide responses to the following scenarios:
  1. The age of majority is different in the testator's jurisdiction (i.e. jurisdiction A) than in the beneficiary's jurisdiction (i.e. jurisdiction B), but the testator's will provides for an outright cash gift of $30,000 to the beneficiary. (a) consider and discuss whether the personal representative can pay or transfer this gift to the beneficiary residing in jurisdiction B if the beneficiary is considered a minor under jurisdiction B's law although considered an adult under jurisdiction A's law. (b) discuss the reverse scenario, where the beneficiary is considered an adult in jurisdiction B (the beneficiary's jurisdiction of residence), but a minor in jurisdiction A (the testator's domicile at death).
  2. What if the gifted property in scenario #1 above was real property located in the testator's jurisdiction (jurisdiction A) where the beneficiary would be considered an adult, even though still a minor in jurisdiction B?
  3. The testator's will also creates a trust governed by the laws of the testator's jurisdiction (i.e. jurisdiction A) for a beneficiary domiciled in a foreign jurisdiction (i.e. jurisdiction C). The terms of the trust allow for discretionary payments of income and capital during the beneficiary's minority. Advise how the trustee should administer the trust if: (i) the beneficiary is considered a minor under Jurisdiction A but an adult under jurisdiction C, and (ii) the beneficiary is considered a minor under jurisdiction C but an adult under jurisdiction A.
D5 CBEG Prize Topic: Discuss the matters to be considered when advising a testator with multi-jurisdictional assets in both common law and civil law countries. See www.step.org/qp-essay-topics
E INCAPACITY
E1 Powers of attorney that survive the donor's incapacity ("POA") have become a common staple for estate planning. What are the duties and obligations of an attorney appointed under a POA? In your answer, include a discussion on whether attorneys can engage in estate planning for the donor once the donor has become incapacitated.
E2 Donors, while capable, often provide gifts to family members and charities. But, what happens when the donor becomes incapacitated and his or her attorneys under powers of attorney (in Quebec: mandataries and protection mandates) want to make such gifts? Describe the legal considerations involved for an attorney (in Quebec: mandatary) making a gift to: (i) himself/herself, (ii) family members, and (iii) charities. In your paper, please also include a discussion on the ability of attorneys (in Quebec: mandataries) to designate beneficiaries on registered plans.



Essay Requirements

Essay Marking
Copyright 2002 — 2019  The Society of Trust and Estate Practitioners (STEP)