What is Probate/Letters of administration?
Answer: The Executor named in a Will must probate (or prove) the Will before obtaining the right to administer the affairs of the deceased. The Executor must file an Application to the Court of Queen’s Bench after which the court signifies the validity of the Will by issuing probate.
If there is no Will, someone must apply to the Court for the right to administer the affairs of the deceased. In this case the order that issues is called “Letters of Administration”. Normally, a spouse or in the absence of a spouse, a child or near relative will make this Application. Such an applicant however must be a resident of Manitoba and must give a personal guarantee and , in some cases, a commercial bond guaranteeing that administration will be carried out properly.
There is a summary procedure available in cases where the total value of the Estate is not in excess of $5,000.00. In these cases, a formal Application is dispensed with.
Duties of an Executor or an Administrator (Personal representative)
The Executor of Administrator, sometimes referred to as the Personal Representative, stands in the place of the deceased and is responsible for carrying out the terms of the Will or, if there is no Will, for administering the Estate according to law.
Generally speaking, this individual is in charge of everything pertaining to the deceased and must take immediate control of the affairs of the deceased including property of the deceased. Among the various further duties of the Personal Representative are the following:
- Locating and listing all assets of the Estate and valuing same
- Locating and listing all debts of the deceased including placing advertisements for debts
- Gathering in all money and property belonging to the deceased
- Paying funeral expenses and all other debts of the deceased including income taxes and the like
- Making decisions as to converting into money, where applicable, assets of the deceased
- Locating beneficiaries
- Arranging to pay bequests
- Delivering to the beneficiaries any articles not consisting of money that may have been bequeathed to them
- Arranging to file appropriate income tax returns both as at date of death and subsequently
- Preparing the final accounts of the Estate and payment out to those entitled according to law after obtaining approvals of the beneficiaries and/or the Courts, where required
Some answers that may be required immediately.
The Executor is in charge of burial arrangements. If there is no Will the next-of-kin normally takes responsibility for this.
Canada Pension plan
Often there are death benefits including funeral expenses payable. Persons who may be entitled to benefits should make immediate application to the nearest Canada Pension Plan office.
In Winnipeg, the address is:
Income Security Programs
Health & Welfare Canada
Main Floor – 255 Portage Avenue
Box 818 Station Main
Immediate Access for Spouse
Most things are frozen until Probate or Letters of Administration issue. However, particularly when amounts are small and the parties are known to the financial institution, financial institutions will often make immediate arrangements for a surviving spouse.
All assets held jointly by spouses pass to the surviving spouse. If, for example, there is a joint bank account, the surviving spouse may have immediate access to all funds in that account.
Similarly, if there is a safety deposit box registered in both names, the surviving spouse may immediately obtain access to the contents of the safety deposit box. If the box is registered only in the deceased’s name, the Bank will open the box for the purpose of listing the contents only; the contents must remain in the box until Probate or Letters of Administration issue. These contents might be title documents, Will, etc. The Bank is obliged, however, to provide a copy of the list of the contents and release the Will to the intended Executor.
If Canada Savings Bonds, Certificates of Deposit or Guaranteed Investment Certificates issued by financial institutions are in both names jointly, upon appropriate proof being given to the financial institutions, they will be transferred to the surviving spouse.
Once again, if these documents are not held jointly, the Executor must transfer them in accordance with the Will.
One should note that a Certificate such as those above may be for a specific number of years and may not normally be redeemed at the date of death; however, some Certificates provide for redemption at the option of the Personal Representative of the deceased at the date of death. These terms and conditions must be canvassed very carefully.
Life insurance, unless the beneficiary is the Estate, goes directly to the beneficiary and does not form part of the Estate. The beneficiary normally contacts the policy owner’s agent and after filing appropriate proof of death and the like, is able, in fairly short order, to access these funds.
The Court of Queen’s Bench charges Estates based on the value of the assets. For example, an estate valued at $100,000.00 will pay a fee of $601.00. Again, joint property and insurance proceeds not payable to the Estate do not form a part of this calculation.
Executor’s or Administrator’s fees
A personal representative may ask for payment for services rendered and is entitled to a fair and reasonable allowance for care, pains, trouble and time. That allowance is not a fixed amount or percentage but will vary according to the work done. If all beneficiaries are adults and are satisfied with the work of the personal representative, they may agree on the amount of the fee. In the alternative, the personal representative may be called upon to pass his or her accounts before the Court of Queen’s Bench and the Court will set the fee.
The personal representative is permitted to employ a lawyer to assist in his or her duties. The fees of the lawyer are paid out of the Estate and are governed by the Court of Queen’s Bench Rules. Briefly stated, the basic fees are computed on the basis of the value of the Estate; and in Estates of average complexity are computed as follows:
- 3% on the first $10, 000.00
- 2% on the next $90, 000.00
- 1% on the next $200, 000.00
- Over $300, 000.00 by agreement of application to the Court.
- Only 40% of those fees are payable where the personal representative is a Lawyer, a Trust company or the Public Trustee
The fees are always subject to review by the Court.
These fees are intended to cover ordinary Estates and lawyers are permitted to charge additional fees for matters not intended to be covered by the above tariff.
Who is the Lawyer acting for?
Normally, the lawyer acts for the personal representative. Any beneficiary is free to obtain separate legal advice from some other Lawyer.
Do I need a Lawyer to handle an Estate?
It is often said that a person who acts for himself has a fool for a client. A Lawyer is prepared by training and experience to handle the administration of an Estate. Legal advice will often save costly and time consuming errors.