What is Probate, and do I Have to Apply for it?
Although a Will becomes effective upon death, in the vast majority of cases, it is necessary to have the Will probated. Probate refers to a process whereby the Court issues a document known as a “Certificate of Appointment of Estate Trustee” (previously known as “Letters Probate”). This document is court confirmation to third parties that the executor named in the Will has the authority to deal with estate assets.
Obtaining a Certificate of Appointment of Estate Trustee is usually necessary if the deceased owned certain assets in his or her name alone at death, which include bank accounts, investment accounts and real estate located in Ontario. There are exceptions to this general rule and we encourage you to speak with a lawyer to determine if probate is necessary.
What are my Initial Responsibilities?
Making proper funeral and burial arrangements; determining that the Will appointing you is the last Will of the deceased; apply for Canada Pension Plan benefits (forms provided by funeral home); obtain proof of death (provided by funeral home); secure custody of the deceased’s assets; advise third parties of death, including employers, banks, tenants, advisors, cancel subscriptions and credit cards and re-direct mail; contact Passport Canada to cancel deceased’s passport, contact Service Canada to cancel deceased’s SIN and contact Service Ontario to cancel deceased’s OHIP card.
This is only a list of the initial and immediate responsibilities. We encourage you to seek legal advice as to how to proceed in your particular circumstance.
Do I Have to Organize a “Reading of the Will”?
There is no requirement to organize a reading of the Will for the family members and other beneficiaries of a deceased person. In Ontario, beneficiaries who are entitled to a specific gift in the Will, such as a cash gift or a gift of personal effects or property are entitled to receive the excerpt of the Will that relates to his or her gift. If a beneficiary is entitled to a percentage/share of the estate, he or she is entitled to receive a copy of the full Will of the deceased.
What Information Should I be Sharing with Family Members Who are Not Beneficiaries?
There is no obligation at law to share a copy of the Will with individuals who are not beneficiaries. That said, certain individuals may have a claim against the estate and should be notified that the executor is making an Application for a Certificate of Appointment of Estate Trustee. This is especially true of spouses or a dependent who was a spouse, parent, child or sibling of the deceased who may be of the opinion that they were not treated fairly in the deceased’s last Will.
A spouse has six months from the death of his or her spouse to make a claim for equalization against the estate. A dependent who wishes to make a claim against the Estate has six months from the date the Certificate of Appointment is granted. In either of these cases, the executor should, as a courtesy, notify these individuals when the Application for a Certificate of Appointment has been made and when the Certificate of Appointment is obtained.
Is This a Paid Job?
Although the law provides that an executor is entitled to be compensated for their time and effort, such compensation either must be awarded by the Court or agreed upon by all the beneficiaries. If any of the beneficiaries cannot provide consent because they are minors or incapable adults, compensation can only be awarded by the Court.
Generally, the starting point for determining executor’s compensation is 2.5% of funds that come into an estate plus 2.5% of funds that flow out of an estate. If there are assets being held in trust, there is an additional fee of 2/5 of 1% of the value of the assets being held.
That said, a strict calculation of these amounts is not the whole story. Often, there are other factors that need to be examined and we encourage you to seek legal advice before paying yourself a fee.
Written by: Richard Diamond, Senior Associate, Bales Beall LLP