Category Archives: Probate

Estate Administration Misconceptions

The Executor can implement the will right away.

No! The Executor is not the official legal representative of the Deceased until the Court has confirmed the will and issued Letters Probate to the Executor.

Probate takes about a month or two.

Well, sort of… Before an application for probate can even be submitted to the Court, the Executor must search for other wills, confirm all assets and liabilities, then notify all potential beneficiaries of your passing and provide them with a copy of your will. After submitting the application, processing times at the Court Registry often take about a month or two, or more.

But then… Following receipt of Letters Probate, your affairs must be settled (debts paid, assets sold, tax filings submitted to government) and a proposed distribution must be approved by your beneficiaries or confirmed by Court Order. Distribution of assets commonly takes place a year or more following death.

Probate is too much work, it is better to die without a will.

Just the opposite! Dying intestate (without a will) does not avoid probate, it merely adds a layer of administrative work to the process. Before an intestate’s estate may be probated, a legal representative (Administrator) must be selected and approved and the Administration may be required to deposit a sizeable financial bond with the courts. All other steps remain and must be completed after the appointment of this Administrator. The Administrator must then distribute assets in accordance with legislation rather than your personal wishes.

Executor’s Fees

“You want to charge what?!” In a perfect world, no executor would ever hear these words (and no beneficiary would feel the need to utter them). Unfortunately, issues involving executor’s fees often do arise.

Whether you are crafting your own will, agreeing to act as an executor, or approving accounts as a beneficiary, it is imperative to understand how executor’s fees are set. Fees can be set in a will itself, but if they are not specifically set out in a will, the Trustee Act limits fees to a maximum of 5% of the value of estate assets, plus a calculation for ongoing management if that becomes necessary.

It is a misconception that executors are entitled to 5%; this is the maximum fee under the statute.

Let’s assume your executor sells your assets for a total of $300,000, distributes some of the estate immediately but then must hold $200,000 in trust for three years before distributing to certain beneficiaries. Assume the executor invests that money and the estate earns $15,000 in interest each year. Maximum fees would be:

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In determining what to charge as an executor, and what to approve as a beneficiary, the size of the estate, complexity of the matters dealt with, time and skill required to finalize matters and level of success achieved are all to be taken into consideration. Every beneficiary whose inheritance is affected by the fee must approve the executor’s fees, or the executor will have to apply for the Court’s approval before taking the fee and finalizing the estate.