All About Estates
By Mohena Singh
September 5th, 2025
Litigation takes place in the context of a bitter family dispute— Was the money a gift or a loan?
In the realm of family law and financial planning, the case of Klemensiewicz v. Klemens et al sheds light on the intricacies of familial financial support, particularly the distinction between gifts and loans.
Many individuals prefer to see their loved ones benefit from their generosity while they are alive, allowing them to witness the positive impact of their support. This desire can sometimes lead to misunderstandings or disputes, as seen in this recent court case, where the intention behind a significant financial contribution was contested.
It is important to clearly document and communicate intentions when making either a loan or a gift to a family member. Sometimes we assume a verbal agreement is sufficient but having clear written documentation removes uncertainty and mitigates the risk of disputes arising after the fact.
When providing for loans or gifts to family members during a person’s lifetime, it can be helpful to make a note of such transfers for estate planning purposes as well. If someone wishes to take into consideration any loans or gifts made to family members in their estate planning, it is important that such amounts are clearly documented.
It is then easier to incorporate such amounts in the will, including in any equalization provisions so that all beneficiaries are treated equitably. Accurate characterization of amounts paid to family members is also critical to determining whether there are additional assets of an estate, such as loans owing from family members.
