1. Who is an Executor?
An executor of a will in Canada is the person who is responsible for carrying out the wishes of the deceased person as expressed in their will. This includes tasks such as:
- Gathering and valuing the deceased person’s assets
- Paying off any debts or taxes owed by the deceased person
- Distributing the deceased person’s assets to their beneficiaries
The executor is also responsible for administering the deceased person’s estate in accordance with the law. This may involve obtaining probate, which is a court order that confirms the validity of the will and appoints the executor as the legal representative of the estate.
The executor can be anyone who is over the age of majority in their province or territory and who has the mental capacity to manage the estate. The executor can be a family member, friend, lawyer, or accountant.
2. What happens if I do not appoint an Executor?
If the deceased person has not named an executor in their will, the court will appoint one. The court will typically appoint a family member or friend of the deceased person, but they may also appoint a professional executor, such as a lawyer or trust company.
Here are some tips for choosing an executor:
- Choose someone who is trustworthy and reliable.
- Choose someone who is organized and detail-oriented.
- Choose someone who is familiar with the deceased person’s estate and their wishes.
- Choose someone who is willing and able to serve as executor for the duration of the estate administration process.
Being an executor can be a challenging and time-consuming task, but it is also an important one. By choosing an executor carefully and providing them with the support they need, you can help to ensure that the deceased person’s wishes are carried out smoothly and efficiently.
3. What powers does an Executor have?
In addition to the tasks mentioned above, executors may also have other specific powers that are granted to them in the will. For example, the will may authorize the executor to sell real estate, to start or continue a business, or to manage a trust for the benefit of a minor or incapacitated beneficiary.
Executors also have a number of fiduciary duties, which means that they must act in the best interests of the estate and its beneficiaries. These fiduciary duties include the duty of loyalty, the duty of care, and the duty of impartiality.
4. What must an Executor do after the testator has passed away?
While individual situations will vary, below is a rough list of things that should happen.
- Secure the testator’s belongings and property. This may involve changing the locks on the testator’s home, canceling credit cards, and notifying banks and other financial institutions of the testator’s death.
- Gather important documents. This includes the testator’s will, death certificate, birth certificate, social security number, and insurance policies.
- Notify the testator’s loved ones. This may involve contacting family members, friends, and co-workers.
- Arrange for the testator’s funeral or memorial service.
- Take inventory of the testator’s assets. This includes identifying all of the testator’s assets, such as bank accounts, investments, real estate, and personal belongings.
- Hire a lawyer to help with the probate process.
- Apply for probate. This is a court process that confirms the validity of the will and appoints the executor as the legal representative of the estate.
- Notify the testator’s creditors. The executor is responsible for paying off all of the testator’s debts, including credit card debt, loans, and taxes.
- Begin distributing the testator’s assets to the beneficiaries. This may involve selling assets, such as real estate or investments, and transferring the proceeds to the beneficiaries.
- File the testator’s final tax return.
- Obtain valuations for the testator’s assets. This will help the executor to distribute the assets fairly to the beneficiaries.
- Cancel the testator’s driver’s license and passport.
- Update the testator’s credit report with the three major credit bureaus.
- Continue distributing the testator’s assets to the beneficiaries.
- Close the testator’s bank accounts and credit cards.
- Transfer the testator’s vehicle titles to the new owners.
- Sell the testator’s real estate.
- File the testator’s estate tax return.
- Close the testator’s estate.
- Keep good records of all of your transactions as executor. This will help you to account to the beneficiaries and to the court, if necessary.
- Communicate regularly with the beneficiaries. Keep them informed of the progress of the estate administration process and answer any questions they may have.
- Seek professional help if you need it. Lawyers, accountants, and other professionals can provide valuable assistance to executors.
5. Can the Executor of a will take everything?
The executor of a will cannot take everything, unless they are the sole beneficiary of the will. An executor is a fiduciary to the estate, meaning that they have a legal obligation to act in the best interests of the estate and its beneficiaries. This means that the executor cannot simply take the estate assets for themselves, even if they are the only beneficiary.
Instead, the executor must distribute the estate assets to the beneficiaries according to the terms of the will. If the will does not specify how the assets should be distributed, the executor must follow the laws of intestate succession in their province or territory.
If an executor does attempt to take everything from the estate, the beneficiaries can file a lawsuit to challenge the executor’s actions. The court may order the executor to return the assets to the estate and may also remove the executor from their position.
Here are some examples of what an executor can and cannot do:
- Gather and value the estate’s assets
- Pay off the estate’s debts and taxes
- Distribute the estate’s assets to the beneficiaries according to the terms of the will
- Take the estate’s assets for themselves
- Change the terms of the will
- Give preferential treatment to any beneficiary
6. What must the Executor share with beneficiaries?
An executor has a legal duty to disclose certain information to beneficiaries. This duty of disclosure is important because it helps to ensure that beneficiaries are informed about the estate administration process and that they can make informed decisions about their inheritance.
The following are some of the things that an executor must disclose to beneficiaries:
- The existence of the will. The executor must inform the beneficiaries that a will exists and must provide them with a copy of the will.
- The identity of the executor. The executor must identify themselves to the beneficiaries and explain their role in the estate administration process.
- The nature and value of the estate’s assets. The executor must provide the beneficiaries with a detailed inventory of the estate’s assets and their values.
- The estate’s debts and liabilities. The executor must inform the beneficiaries of the estate’s debts and liabilities and how these debts and liabilities will be paid.
- The executor’s fees and expenses. The executor must disclose their fees and expenses to the beneficiaries and explain how these fees and expenses will be paid.
- The distribution plan for the estate’s assets. The executor must provide the beneficiaries with a proposed distribution plan for the estate’s assets. The distribution plan should explain how the executor plans to distribute the assets to the beneficiaries in accordance with the terms of the will.
In addition to the above, the executor must also respond to any reasonable requests for information from the beneficiaries. For example, the beneficiaries may ask the executor for information about the status of the estate administration process, the value of their inheritance, or the reasons for certain decisions made by the executor.
If an executor fails to disclose information to the beneficiaries, the beneficiaries may file a lawsuit to compel the executor to disclose the information. The court may also order the executor to pay the beneficiaries’ legal fees if the executor’s failure to disclose was unreasonable.
7. What are the most challenging tasks of an Executor?
The role of an executor can be complex and challenging, and there are a number of difficult tasks that an executor may face. Some of the most difficult tasks for an executor include:
- Distributing the estate’s assets fairly. This can be especially difficult if the beneficiaries have different expectations or if there is conflict among the beneficiaries.
- Dealing with complex estate planning issues. This may include tasks such as interpreting the will, selling assets, and paying estate taxes.
- Balancing the needs of the beneficiaries with the needs of the estate. For example, the executor may need to decide whether to sell a home that is a valuable asset to the estate but that is also a cherished family heirloom.
- Coping with the emotional toll of the job. Being an executor can be a stressful and emotionally draining experience, especially if the executor is also grieving the loss of the testator.
8. What qualities should I look for when appointing an Executor?
When choosing an executor for your estate, it is important to consider the following qualities:
- Trustworthiness and honesty. The executor will be responsible for handling your assets and making important decisions about your estate, so it is important to choose someone who you trust completely.
- Organization and efficiency. The executor will need to be able to manage the estate administration process in an organized and efficient manner. This includes tasks such as gathering and valuing assets, paying debts and taxes, and distributing assets to beneficiaries.
- Knowledge of estate planning. The executor should have a basic understanding of estate planning concepts, such as probate, wills, and trusts.
- Communication skills. The executor will need to be able to communicate effectively with the beneficiaries, creditors, and other professionals involved in the estate administration process.
- Objectivity and impartiality. The executor should be able to make decisions about the estate in an objective and impartial manner, even if there are conflicting interests among the beneficiaries.
In addition to these general qualities, you may also want to consider the following factors when choosing an executor:
- Age and health. The executor should be in good health and should be likely to outlive you.
- Location. If you have assets in multiple states or countries, you may want to choose an executor who lives in a central location or who has experience in dealing with multi-state estates.
- Availability and willingness. The executor should be willing and able to serve as executor for the duration of the estate administration process.
If you are unsure who to choose as executor, you may want to talk to a lawyer or estate planner. They can help you to assess the qualifications of potential executors and make a recommendation.
Here are some additional tips for choosing an executor:
- Talk to your potential executor about their willingness and ability to serve.
- Discuss your expectations with your potential executor.
- Make sure that your potential executor understands your estate plan and your wishes for your estate.
- Choose a backup executor in case your chosen executor is unable or unwilling to serve.
9. Can my Executor change my will?
No, an executor cannot change a will. The will is a legal document that expresses the wishes of the deceased person, and the executor is responsible for carrying out those wishes. If the executor tries to change the will, it is considered a breach of their fiduciary duty.
There are a few limited exceptions to this rule. For example, if the will is ambiguous or if there is a mistake in the will, the executor may be able to petition the court to have the will corrected. However, the executor cannot make any changes to the will without the court’s approval.
10. Does an Executor get paid for estate administration?
Yes, in Canada, executors are typically paid for their services. The amount of compensation that an executor receives depends on a number of factors, including the size and complexity of the estate, the time and effort required to administer the estate, and the executor’s own expertise and experience.
In most provinces and territories, executor compensation is based on a percentage of the estate’s assets. This percentage typically ranges from 2.5% to 5%. In some cases, the court may approve a higher executor fee, if justified by the circumstances.
In addition to executor compensation, executors may also be reimbursed for reasonable expenses incurred in the course of their duties. These expenses may include travel costs, legal fees, and accounting fees.
If you are named as an executor in a will, it is important to discuss your compensation with the testator and to have a clear understanding of your responsibilities before agreeing to serve. You may also want to consult with a lawyer to discuss your compensation options.
Here are some tips for executors on discussing compensation with the testator:
- Be upfront about your expectations. Let the testator know that you expect to be compensated for your services.
- Be flexible. The testator may have their own ideas about how much to compensate the executor. Be willing to negotiate.
- Put everything in writing. Once you have reached an agreement with the testator, put it in writing in a letter of agreement. This will help to avoid any misunderstandings or disputes down the road.