Wills and Estate law can impact people's lives in a number of ways. You may want to create a Will for yourself, you may have been appointed to look after the property of someone who has passed away or you may be a beneficiary under someone else's Will.
The law regarding Wills and Estates is described here in general terms. This is not meant to be a legal authority on the subject. It is not a self-help kit on making a Will, distributing an estate or dealing with concerns you may have as a beneficiary. For specific legal advice you should consult a lawyer and may also require advice from other professionals, such as an accountant or other estate planner.
Although we have tried to use easy to understand language throughout this booklet, it will be helpful to first become familiar with a few special terms that relate to this area of the law.
Testator - The person who makes a Will.
Testatrix - Sometimes used to describe a female testator.
Estate - After a person's death, their assets and liabilities make up their estate. A person's estate can include personal possessions and real property.
Personal Property - Refers to goods and money, including items such as furniture, vehicles, jewelry, animals, clothing, stocks, shares, patents and copyrights.
Real Property - Refers to immovable property such as land and real estate.
Beneficiary - A person named in a Will to receive some of the estate.
Bequest - A gift, usually of personal property, under a Will.
Devise - A gift or transfer of real property under a Will.
Codicil - An addition or change to a Will.
Executor - A person named in a Will to carry out the terms of the Will.
Executrix - Sometimes used to describe a female Executor.
Administrator - A person appointed by the Court to handle the estate if the testator does not name an Executor in their Will, or no Will exists.
Intestate - A person who dies without a Will.
Probate - The Court process of proving that a Will is valid and administering the estate under the supervision of the Courts.
Letters Probate or Letters of Administration - Documents issued by the Court authorizing an Executor or Administrator to deal with an estate.
Creating a Will
A Will is a legal document that sets out how you want your property (everything you own or have an interest in) to be distributed after your death. Wills come into effect only after your death, meaning that beneficiaries under a Will have no interests before your death. During your lifetime, you can change your Will whenever you like.
Why Have a Will?
Writing your Will may be one of the most important things you'll ever do. A properly drafted Will can help ensure that following your death your property is divided the way you intended and benefits the people you intended.
Not having a Will can create considerable hardship for family, friends and business partners. Without a Will, your property may not be distributed the way you had intended. It may be difficult to trace relatives who may be entitled to inherit, and locating all your property and belongings can be more complicated.
If you have a Will, the administration of your estate is generally easier, quicker and usually less expensive. If you have a Will, you can authorize your Executor to do things that cannot be done otherwise. For example, in your Will you can authorize your Executor to...
- make choices to maximize tax benefits
- make choices about investments that would not otherwise be authorized
- deal with trust funds
- borrow money
- trade in assets
Who Can Make a Will?
Any mentally competent person who is 18 years of age or older can make a Will. In a few instances, persons under the age of 18 can make a Will. For example, persons under the age of 18 may make a valid Will if they are married or living in a spousal relationship, or are on active duty with the armed forces.
At the time of making a Will you must be of sound mind. You must understand the value and extent of your property and that it will be left to the beneficiaries named in your Will.
For a Will to be valid you must feel free from any force, threat or undue influence exercised by someone else. A Court can invalidate a Will made under circumstances of force, threat or undue influence.
A Will is usually prepared by a lawyer. A lawyer can ensure that...
- the requirements for a valid Will are met
- the Will states your intentions clearly
- you receive advice about whether the terms are enforceable
- you get advice about the contents of the Will and general estate planning
Under Saskatchewan law, a Will must be in written form and signed by the testator. Unless you make a holograph Will, you must sign your Will in front of two witnesses. Each witness must then sign the Will.
A Will should not be witnessed by a beneficiary or the spouse of a beneficiary. Such witnesses will lose any benefit under the Will unless they obtain a Court Order allowing them to benefit.
If all the legal requirements for a valid Will are not met, but the intention of the deceased person is clear, a Court can still be asked to give effect to the document. In appropriate circumstances, the Court may agree to recognize the document. This application process can be time consuming and costly, however, and may not always result in the document being legally recognized. A lawyer can help ensure that the legal requirements for a valid Will are met and that your last wishes can be followed.
Holograph Wills are valid in Saskatchewan provided that they are entirely in the testator's own handwriting and signed by the testator. Holograph Wills do not need to be witnessed.
Form Wills, which may be purchased online or in stores, have printing other than the testator's own handwriting and do not qualify as holograph Wills. These Wills must be witnessed by two individuals.
Each province sets its own laws regarding what is required to make a valid Will, and what rights exist for dependants' relief or division of family property. If you move to another province or out of the country after you make a Will, you may want to check with a lawyer in your new area. This will help you determine how your Saskatchewan Will applies to any part of your estate that is in a different jurisdiction.
Depending upon where you move to, you may want to consider making an international Will. You will need a lawyer's assistance to do this. An international Will follows a standard format for Wills that is recognized by an international convention. As long as you follow the format set out in the Convention, all of the jurisdictions which sign on to the convention will recognize your Will as valid in their jurisdiction. The Convention, included at the end of The Wills Act, is available from the Queen's Printer.
Planning Your Will
Naming an Executor
Choosing a person to be responsible for looking after your estate is an important decision. Carrying out the terms of your Will may be a short-term or a long-term job. If you like, you can name more than one Executor to act together as joint Executors. You can also name one or more alternate Executors, in the event that your first named Executor or Executors cannot act. Naming too many Executors, however, can make the Executors' duties difficult to carry out.
You can choose anyone you want as Executor. Some people choose their spouse, a family member or friend, while others choose a professional, such as a trust company. It is alright to name an Executor who is also a beneficiary; in fact it is not uncommon to name your main beneficiary as your Executor also. If you are planning on naming a friend or family member, it is a good idea to discuss the matter with them first.
Your Executor should be a responsible individual who is willing to carry out your wishes as stated in your Will. They must be able to make decisions on the advice of lawyers, accountants and other professionals after considering the advantages and disadvantages of each decision.
You may want to choose an Executor who lives in your province - it will generally be more convenient and less costly. If you name more than one Executor, you may be able to avoid delays and possible loss of documents in the mail if they live in the same general area. You may want to choose an Executor who is younger than you, but old enough to be responsible and make all the necessary decisions. Your Executor should be trustworthy and competent.
By law, Executors under a Will and court-appointed Administrators have a right to be paid for their services. Fees are discussed in more detail under the section titled Estate Costs.
Information for Your Executor
Your Executor stands in your place upon your death and their duties begin immediately upon your death. Your Executor is responsible for funeral and burial arrangements, and distributing your estate according to your Will. You can help your Executor by preparing a letter detailing matters such as...
- your plans for burial or cremation
- where your bank accounts are held
- life insurance policies that you have
- where other important documents are kept
- instructions concerning different matters relating to your estate
If you have particular plans for your burial or funeral, it is important to discuss these in detail with your Executor and close relatives. Your Executor has the legal responsibility for arranging your funeral and burial. While your Executor is not bound by your wishes, it is rare that your wishes would be ignored. But it is important to discuss these matters with your Executor; merely stating your preferences in your Will may not be adequate because your Will may not be located or read until sometime after your death. If you have entered into a prepaid funeral services contract, make sure to make a copy of the contract available to your Executor. You and your Executor may also be interested in PLEA's publication A Death in the Family.
Choosing a Legal Custodian for Minor Children
If you have children under the age of 18 you will want to think about who you would like to care for them in the event of your death, where there is either no surviving parent or there is an agreement or court order authorizing you to appoint a legal guardian.
It is important to understand that naming a legal custodian in your Will is not binding and can be challenged on the basis of "the best interests of the child." A Court can review the custody of children at any time. Concerned relatives or friends may ask a Court for such a review. If a legal custodian is unable or unwilling to act, the Court can appoint another person to be the legal custodian. However, it is still important to deal with this matter in your Will so that your wishes are known, as they will always be an important consideration should the matter be challenged.
In choosing a legal custodian, you may want to consider the attitudes of the proposed custodians towards important matters, such as education and religious beliefs. You may want to consider their financial ability to raise your children, keeping in mind what you are able to provide for under your Will. It is important to discuss your wishes with the legal custodian you are considering. You can change this, or any, part of your Will if circumstances change or you simply change your mind.
Naming a Property Guardian for Your Children
Your Executor will manage your children's property that passes through the estate, such as sums of money or real estate. You may also want to name a property guardian to manage children's property that is not part of your estate, such as a Registered Retirement Savings Plan that names a child as a direct beneficiary. The property guardian can be the same person as your Executor. If you do not name a property guardian and one is needed, the Court can appoint a guardian. If no one is available, the Court will appoint the Public Guardian and Trustee to be the property guardian.
The Public Guardian and Trustee is authorized to exercise some of the provincial government's guardianship powers over dependant adults and children under the age of 18, and also monitors the actions of Executors and trustees who are managing a child's property.
Dealing with Your Property
You can leave your property to anyone you wish - family, friends, charitable organizations and so on. You can make specific gifts of individual items of personal belongings, such as jewelry or furniture, and real property, such as land and buildings. For example, a Will might say something like "To my brother John Brown, I leave my entire stamp collection" or "To my only daughter, Sarah Brown, I leave my cabin located at Sandy Shores, Saskatchewan."
You can also divide your estate between certain people without specifying who gets what. For example, a Will might say something like "I direct that ½ of my estate be given to my spouse, Pat Green, and the remaining ½ portion of my estate to be divided equally between my children, Robin, Dale and Toby."
Many Wills provide for some specific gifts and divide the remainder of the estate between particular beneficiaries. It is important to adequately describe specific gifts so that they can be easily identified. If the specific gift no longer exists at the time of death of the testator, the named beneficiary will not receive anything in its place.
The property remaining after specific items are distributed is called the residue. It is important that your Will have a residual clause to deal with any property not specifically mentioned. If you do not include a residual clause in your Will, and your estate includes property not otherwise covered in your Will, this property will be divided according to The Intestate Succession Act. This Act sets out rules for distributing an estate when there is no Will and is discussed more fully under the section titled Distributing the Estate.
Property Outside of Will
Some property, such as benefits under an insurance policy or Registered Retirement Savings Plans, may be passed on directly to a named beneficiary without forming part of your estate. Your Executor or Administrator is not responsible for dealing with this property and no estate fees attach to it.
Joint property is property that is owned by two or more people, such as bank accounts and land. Generally joint property includes the right of survivorship, meaning that when one joint owner dies, the ownership of the property passes to the surviving joint owner or owners. Joint property with the right of survivorship cannot be disposed of under a Will and does not form part of the deceased person's estate.
Location of Property
Generally speaking the validity and effect of a Will regarding real property, such as land, is determined by the law of the place where the land is located, while the validity and effect of a Will regarding personal property is determined by the law of the place where the testator lived at the time of their death.
Although you can leave your estate to anyone you choose, the law protects a dependant, such as your spouse or child, if you have not properly provided for them. Under The Dependants' Relief Act the Court has the power to review your Will and redistribute your estate to properly provide for your dependants.
A dependant may include...
- your spouse by marriage
- someone you lived with, as a spouse, for at least two years
- someone you lived with for less than two years but have a child with
- a child under the age of eighteen
- a child over the age of eighteen who is mentally or physically unable to earn a living, or who, because of need or other circumstance, ought to receive a greater share of your estate
Dependants must apply for relief within six months after Letters Probate or Letters of Administration are issued by the Court.
Under The Family Property Act, married spouses or couples who have lived together as spouses for two or more years may apply to have family property divided before the estate is dealt with. Under the Act spouses are generally each entitled to one half of their combined family property, recognizing that both spouses contribute to child care, household management and financial support in the relationship.
If the Court divides family property under this Act, the estate will only include the deceased person's share of the property after the division under the Act.
Spouses cannot apply if they have signed a valid agreement or contract giving up their rights under these laws. There are time limits for making this kind of application.
Tax planning can be one of the most beneficial purposes served in making a Will. The absence of a Will can mean that certain properties need to be sold to pay income taxes and capital gains taxes. This may be avoided or minimized through careful estate and tax planning. Sometimes, taxes can be deferred indefinitely. Tax concessions may be available to...
- assist in farm properties passing from generation to generation
- assist in passing certain shares in business corporations to children
- defer or minimize taxes through the use of life interests
- "roll over" property to avoid capital gains tax on the estate
- "roll over" Registered Retirement Savings Plans to a spouse or dependant children
Cancelling or Changing Your Will
You can cancel or change your Will at any time. You can cancel your Will by doing any of the following...
- physically destroying your Will with the intention of destroying it
- writing and signing something that indicates that you are changing or cancelling your old Will - if this writing is not entirely in your own handwriting the change must be witnessed by two individuals
- making a new Will
Minor changes to a Will are usually done by making a codicil. A codicil can be a separate document made in addition to your Will. Changes may also be made directly on your Will. If the changes are made entirely in your handwriting and signed by you, no witnesses are required. However, if the changes are not entirely in your own handwriting, the changes must be signed by you and two witnesses.
Entering or Ending a Spousal Relationship
If you make a Will and later marry or live in a spousal relationship for two or more years your Will is invalid, unless you indicate in the Will that you are making the Will in contemplation of the marriage or spousal relationship. This general rule does not apply where a testator makes a Will while living in a spousal relationship and later marries that spouse.
Ending a spousal relationship can also revoke or cancel your Will or parts of it. For example, if you name your spouse as your Executor or leave part of your estate to your spouse, those parts of your Will are revoked or cancelled after you divorce, or after 24 months of separation in the case of other spousal relationships, unless you expressly say otherwise in your Will.
Reviewing a Will
Many people put off reviewing a Will even more than they delay making one in the first place. However, a regular review of your Will helps make sure that it still does what you want it to, in light of changing circumstances in your life.
Some experts suggest a periodic review every two to five years. At the very least, you should review your Will when significant events occur in your life, such as...
- ending or entering a spousal relationship
- your children reaching the age of 18
- your child or other dependant becoming ill or disabled to the extent of needing long term financial support, even into adulthood
- beneficiaries predeceasing you
- your children entering or leaving spousal relationships
- new children coming into your family, including grandchildren
- changing financial circumstances, such as receiving an inheritance or selling your business
Safekeeping a Will
A Will should be kept in a safe place where the Executor can easily locate it after the testator's death. Care should be taken to protect it from being accidentally destroyed or lost.
If you have a lawyer prepare your Will, they may offer to keep the original copy at no additional cost. You should be provided with a copy of the original Will to keep with other important papers that your Executor may need. The copy should indicate contact information for the lawyer who prepared the Will. Your Executor can obtain the original copy from the lawyer after your death and is not under any obligation to use that lawyer's services.
Queen's Bench courthouses throughout the province provide for safekeeping of a Will for a small one-time fee (currently $10). You can take your Will to the nearest Court of Queen's Bench - the original will be sealed and kept there. You will be given a certificate to keep with your other important papers, indicating the whereabouts of your original Will. A copy of the certificate is also filed in a central registry at the Court of Queen's Bench in Regina.
Administrating an Estate
When a person dies, someone must look after their estate. A person who was authorized to deal with someone's property during their lifetime is no longer entitled to do so. For example, if you have been appointed as someone's power of attorney, you cannot use that power after their death. A power of attorney ends when the person who granted the power of attorney dies.
If a deceased person has left a Will and named an Executor, the Executor will carry out their duties according to the Will and the law. If the deceased person had a Will but did not name an Executor or did not have a Will, their next of kin or other interested party may apply for Letters of Administration. When there is no Will the property will be divided according to The Intestate Succession Act.
An Executor's or an Administrator's duties include...
- paying the debts of the deceased and of the estate
- distributing the estate according to the Will and the law
- accounting for the distribution of the estate
Professional assistance and advice from a lawyer is not legally required. However, most Executors and Administrators seek professional legal advice to avoid legal problems and personal liability. Additional services from other professionals, such as accountants, may also be very helpful. Reasonable fees for such services can be charged to the estate.
Letters Probate formally recognize that a Will is valid and that an Executor is entitled to deal with the estate. If the estate does not involve any real property, it may not always be necessary to get this document from the Court before dealing with the estate. Practically speaking, however, many agencies and institutions will insist on such formal recognition before dealing with an Executor or agreeing to the release of funds. Agencies, such as banks and insurances companies, can have their own policies about what is required before they will release funds they hold. Real property cannot be dealt with without Letters Probate or Letters of Administration.
The Court requires several documents before granting Letters Probate. These documents must be signed before a Commissioner for Oaths. In Saskatchewan, lawyers are also Commissioners for Oaths. If a lawyer has prepared the documents, their signature will be sufficient. If someone other than a lawyer has prepared the documents, you can find a Commissioner for Oaths by looking through the yellow pages of the phone book, online directory or checking with the courthouse.
The following documents must be filed with the Court before Letters Probate can be issued...
- Affidavit of Execution of Will with Original Will Attached: one of the witnesses to the Will must swear an Affidavit stating that they witnessed the testator's signature. If neither witness can be located, the Court may accept proof by analysis of the signature of the testator or one of the witnesses.
- Application for Grant of Probate: includes information about the deceased and beneficiaries, the date of death and a request for Probate of the Will.
- Affidavit of Executor: a document sworn by the Executor that requests Probate from the Court and contains promises by the Executor to properly administer the estate.
- Statement of Property: a statement which outlines in detail all the known assets of the deceased which are to be administered by the Executor and their value at the date of death and a statement that lists the description and estimated value of property of the deceased that does not form part of the estate, such as jointly owned property and items payable to a named beneficiary under particular documents, such as life insurance policies, RRSP's and annuities.
- Notification to the Public Guardian and Trustee that there are beneficiaries under the age of 18 or dependant adults with an interest in the estate (if applicable).
- Certificate that there are no persons under 18 years with an interest in the estate (if applicable).
There is a Letters of Probate package available online at www.sasklawcourts.ca under the Wills and Estates - Application for Probate section. This package has the forms you need to apply for Letters Probate and shows how they should be filled out. The package can only be used when there is a Will that names an Executor and the Will was witnessed by two people. Information kits may also be available at your nearest Court of Queen's Bench.
Documents and required fees must be submitted for filing with the Registrar of the Court. A Judge will review all the documents and grant Letters Probate if everything is in order. Although there is no requirement, in many cases a lawyer's assistance will be needed to probate the Will.
Letters of Administration
Sometimes a person dies without naming an Executor to deal with their estate. This can happen if the deceased person didn't prepare a Will or prepared a Will but didn't name an Executor. In other cases, a person may have named an Executor in a Will, but that person may be unable or unwilling to act as Executor.
In situations such as these, certain people can apply to the Court for authorization to act as Administrator of the estate.
A beneficiary or other interested person, usually the next of kin, may apply for Letters of Administration. The law sets out who has priority to apply for Letters of Administration - a spouse, then children, then parents, and so on. A person applying for Letters of Administration must have the approval of other persons who have greater or equal rights to apply. Up to three people may apply to jointly administer the estate.
Documents similar to what an Executor files for Letters Probate must be filed. However, in these circumstances the documents are...
- Letters of Administration - where there is no Will, or
- Letters of Administration with Will Annexed - where there is a Will but no Executor is named or the named Executor is unable or unwilling to act
The Court may require an Administrator to post a bond to help ensure that the estate is properly administered. A bond may not be necessary if all beneficiaries and creditors agree that it is not necessary.
Information kits regarding Letters of Administration may be available at your nearest Court of Queen's Bench.
When the value of an estate is small there are two options that can simplify the process.
If there is real property but the total value of the estate in under $15,000, Letters Probate (if there is an Executor) or Letters of Administration (if there is no Executor) are still required but the local register can prepare them. This means that no application for probate or administration needs to be made. A person who is entitled to apply for Letters Probate (the Executor) or Letters of Administration (beneficiary, next-of-kin or other person who has the consent of others with more priority under the law) can contact the local register to determine the required documents to have the local register prepare the letters for them. There is small fee for this.
If there is no real property and the total value of the estate is under $25,000, Letters Probate or Letters of Administration are not required. Any interested individual can apply to court for an order that the property be given to them to be distributed. This is done by preparing An Application in Small Estates - Memorandum to the Judge. This is form 16-36 in the Queen's Bench Forms. The person applying to the court states how they propose to deal with the estate (pay funeral expenses and debts and then distribute the rest to the person(s) entitled). They also file an Affidavit setting out who is entitled to share in the estate and the amounts of debts and funeral expenses.
Responsibilities of the Executor or Administrator
The duties of an Executor are to carry out exactly what the testator stated in their Will. By law, the Executor must pay all debts of the deceased from the proceeds of the estate, distribute the remaining assets and make an account of all the property received and distributed.
An Administrator does not always have the benefit of a Will to assist in determining the intentions of the deceased. The Intestate Succession Act sets out in detail how the assets of an estate must be distributed when there is no Will.
Whether you are acting as an Executor or an Administrator, the steps in administering an estate are the same...
- locate the Will, if there is one
- locate the assets of the deceased and determine their value
- obtain death certificate and notify various agencies of the death - some agencies will require a copy of the death certificate
- prepare a list of beneficiaries and their addresses
- file claims for life insurance, pension plans, death benefits
- pay funeral bills (banks may allow these to be paid directly from the deceased person's account if the bills are submitted to the bank)
- obtain the appropriate Court Order - Letters Probate or Letters of Administration, if required
- notify the Public Guardian and Trustee if there are any children under the age of 18, or dependant adults, who may have an interest in the estate
- advertise for creditors in the required form and manner to help protect yourself from liability
- call in the estate - gather the assets, arrange for sale or disposition of assets not specifically left to a named beneficiary, place all monies from all sources into an estate bank account
- transfer Title of all real property to the estate
- pay the bills and debts of the deceased and the estate
- complete Income Tax Returns and obtain the necessary Income Tax Clearance Certificate required to complete the distribution of the estate
- keep complete records of all assets coming into the estate and going out of the estate
- obtain appropriate releases from beneficiaries required to complete the distribution of the estate or arrange for passing of accounts if there are any disputes amongst the beneficiaries - passing of accounts means asking the Court to approve your financial records of the estate and your plan for distributing the estate
- distribute the estate according to the Will or The Intestate Succession Act
Must I Act as Executor?
In some cases, you may be unable or unwilling to take on the responsibility of acting as Executor. Other commitments may prevent you from devoting the necessary time and attention to the administration of the estate. You are not required to act as Executor if you do not wish to do so. You may simply sign a Renunciation of Probate form indicating that you are giving up the appointment as Executor. This allows a person named as an alternate Executor to apply to the Court for Letters Probate or, if no alternate Executor was named, for another person to apply to the Court for Letters of Administration.
The Executor or Administrator is responsible for distributing the estate to the people legally entitled to all or part of the estate. This means distributing the estate according to the Will, or The Intestate Succession Act if there is no Will, but it also means first dealing with any liabilities or debts of the estate. Failure to properly deal with potential claims on the estate can result in the Executor or Administrator being found personally responsible for amounts that were improperly transferred out of the estate.
Waiting Period for Dependant or Spousal Claims
Executors and Administrators must wait six months after Letters Probate or Letters of Administration are issued to distribute the estate. This allows dependants and spouses to apply for relief. If an Executor or Administrator ignores this time period and distributes the estate earlier, they may be personally liable to dependants or spouses. Executors and Administrators may obtain written permission from dependants and spouses who consent to an earlier distribution. Executors and Administrators may want to obtain legal advice on all matters pertaining to possible claims under these laws.
The Public Guardian and Trustee
Where children under the age of 18 years have an interest or claim in an estate, the Public Guardian and Trustee becomes involved. The Public Guardian and Trustee ensures that a child's property interests are protected. Because the Public Guardian and Trustee monitors the actions of Executors and Administrators where children or dependant adults are concerned, it may be necessary to obtain consent from the Public Guardian and Trustee before dealing with an estate. For example, if a child is left a house or some land, the Public Guardian and Trustee must consent on behalf of the child before the Executor or Administrator can sell the house or land.
In Saskatchewan, children under 18 do not have the legal capacity to manage their own financial affairs. Children under the age of 18 do not receive their share of the estate outright until reaching the age of 18, at the earliest, or later if the Will indicates. When a child under 18 is a beneficiary under a Will, the Executor may be authorized to manage the child's share of the estate until the child turns 18 or older. The Will may direct the Executor to pay any expenses required to properly care for and maintain the child. An accounting of the estate and investments on behalf of the child must be provided to the Public Guardian and Trustee once a year.
The Public Guardian and Trustee can be appointed as the property guardian for a child under 18 who is a beneficiary of an estate if there is no one else to do so. The Public Guardian and Trustee may also act as a property guardian for a dependant adult if there is no one else to take on the responsibility.
Canada Revenue Agency
One of the duties of the Executor or Administrator is to pay any debts of the deceased or the estate. This includes paying taxes. Once an Administrator or Executor has filed all the necessary tax returns, paid any amounts owing and received all related Notices of Assessment, a Clearance Certificate may be requested. A Clearance Certificate indicates that the deceased person has no outstanding tax liabilities with the CRA. Administrators and Executors who distribute estates before getting this type of clearance can be personally liable if there are any outstanding tax liabilities.
Executors and Administrators are responsible for paying all just debts of the estate before distributing the estate to the beneficiaries. As an Executor or Administrator you may not be aware of all the debts owed by the deceased or the estate. You can protect yourself from future claims by creditors you did not know about by advertising for creditors before you distribute the estate. This way you can pay any legal debts while there is still money in the estate to pay the debts and will not be responsible for debts you did not know about.
To protect yourself against creditor claims you need to advertise in the newspaper nearest where the deceased lived, once a week for two consecutive weeks. The advertisement must be in the form set out in the Queen's Bench Forms. The advertisement must include a date by which any creditor has to notify you, the Executor, of a claim. If you do not receive any notices from creditors and the date has passed, you can go ahead and distribute the estate and you cannot be held personally responsible for distributing the estate.
Under a Will
Once the six month waiting period is over, debts have been paid and Canada Revenue Agency has issued the Income Tax Clearance Certificate for distribution purposes, the Executor or Administrator may distribute the estate according to the Will. Executors and Administrators distribute specific gifts to certain individuals, as set out in the Will. The remainder of the estate may then be divided according to the Will.
Without a Will
When someone dies without a Will, they are said to have died intestate and their property is distributed according to the rules set out in The Intestate Succession Act. This law does not take into account the wishes of the deceased or their family. The Administrator must distribute the net value of the estate in accordance with the Act. The net value of the estate is the value of the estate after payment of taxes, debts, funeral expenses and so on. The remaining portion of the estate is then distributed according to the following rules...
- If there is a spouse and children and the estate has a net value under $100,000, the entire estate goes to the surviving spouse.
- If the deceased leaves a spouse and one child, the spouse and child each receive half of the remaining estate after $100,000 is given to the surviving spouse. If there is more than one child, the surviving spouse receives $100,000 plus one third of the remaining estate; the remaining two thirds is divided among the children equally.
- If there is a surviving spouse but no children, the entire estate goes to the surviving spouse.
- If there are children and no surviving spouse, the entire estate is shared equally among the children. If any of the children have died but left children (grandchildren of the deceased), then those grandchildren of the deceased receive their parent's share.
- If there is no surviving spouse, children or grandchildren, the surviving parents receive the estate.
- If there is no surviving spouse, children, grandchildren or parents of the deceased, surviving brothers and sisters of the deceased inherit equal shares. If a brother or sister died before the deceased, then their children take what would have been their share.
- If none of the above relatives are surviving, nieces and nephews inherit the estate in equal shares.
- If there are no surviving nieces or nephews, the surviving next of kin inherit.
- If no next of kin can be found, the estate is usually paid to the Public Guardian and Trustee's Office on behalf of the Minister of Finance. Anyone claiming to be a beneficiary has six years from the date of death to make a claim. A claim is made to the Attorney General for Saskatchewan.
Under this Act the definition of spouse includes married spouses, as well as spouses that have lived together as spouses for two or more years, provided that they were living together at the time the intestate died or within the 24 months before the intestate's death. However, if a spouse has left the intestate and is living with someone else in a spousal relationship they are not entitled to any of the intestate's estate.
When the Estate is Insolvent
Sometimes there are not sufficient assets in the estate to pay all the debts of the estate. In these instances The Administration of Estates Act sets out the priority for payment of debts. Reasonable funeral and administration expenses of the estate are paid before any other debts. The Executor or Administrator is not personally liable for debts of the estate, nor are any beneficiaries under a Will. It is, however, important that Executors and Administrators follow the legal scheme for distribution to avoid becoming personally liable for some debts.
Common problems in administering an estate include...
- a dependant claims that they have not been properly provided for under the Will
- a dispute arises with respect to the custody of children
- beneficiaries feel the Executor's or Administrator's fees are too high or not appropriate
- a dispute arises over the sale of property or personal assets
- a creditor alleges that a disputed debt is owed to them
- someone refuses to turn over an asset belonging to the estate
Executors and Administrators may want legal advice to help work out any problems that arise. Reasonable legal fees can be charged to the estate. If the matter can't be resolved, the Executor or Administrator may apply to the Court for direction. The Court can make an Order that settles the issue.
Costs to administer an estate depend on individual circumstances. The estate is responsible for paying all disbursements or costs incurred in administering the estate. Disbursements include all the out of pocket expenses of the lawyer and the Executor or Administrator. The Court can review all the disbursements paid to ensure they are accurate.
Following are the most common costs related to administering an estate. These fees are accurate at the date of printing but are subject to change.
Court costs are set out in the Fees Regulations. They are $7 per $1,000 of the value of the estate. For example, if an estate has a value of $12,000, the Court costs are $84 (12 x $7). Court costs apply only to the value of the assets which are owned solely by the testator and form part of the estate. These costs are paid to the Court when applying for Letters Probate or Letters of Administration. Costs do not apply to the value of any assets that are jointly owned or that are not part of the estate.
Land Transfer Costs
These include fees such as the fee to obtain the Public Guardian and Trustee's consent to sell land that was left to a child and payments to the Information Services Corporation (ISC) when Title to land is transferred to the estate and then to the beneficiaries.
These are fees payable to the lawyer representing the Executor or Administrator. These legal fees are set out in the Rules of Court. For services directly related to the administration of the estate, referred to as core services, these fees are based on a set fee plus a certain percentage of the value of the estate. The breakdown is as follows...
$1,500 plus 1% on the first $500,000
¾% on the next $500,000
½% on any amount over $1,000,000
Core services include things like meeting with the Executor or Administrator, reviewing the Will or The Intestate Succession Act, obtaining information about the deceased's property and debts, providing advice about estate matters generally, and distributing the assets of the estate. Lawyers may agree to lesser fees in some situations, such as where the Executor or the Administrator performs the bulk of these duties.
Non-core services include things like locating beneficiaries, obtaining bonds, paying bills and dealing with creditors, distributing personal belongings, dealing with joint tenancy issues, and dealing with life insurance policies, pensions and investments not payable to the estate. Things such as dealing with tax returns and clearance certificates, attending with beneficiaries, and matters related to the passing of accounts are also considered non-core services.
Fees for non-core services may be based on a percentage of the value of the estate, a specified hourly rate, a fixed fee or some combination of the above. Before taking on estate matters lawyers must provide the Executor or Administrator with a written explanation of their method for billing for non-core services.
Executor or Administrator Fees
By law, Executors under a Will and Court-appointed Administrators have a right to be paid for their services. These fees vary according to the difficulty of the estate and the amount of work the lawyer handles. Sometimes Wills provide for an Executor to receive a specific fee for services. If a Will fixes a fee, the original Executor will not be allowed any additional fee should they agree to act as Executor. Other times Wills provide for a specific gift for the Executor in lieu of other compensation.
Fees may also be agreed upon with the consent of all beneficiaries. In the event that a Will does not stipulate a manner to determine fees and no agreement can be reached, a Court may be asked to determine fees. The Executor or Administrator may waive fees but they are generally paid for out of pocket expenses.
Saskatchewan law states that Executors and court-appointed Administrators are entitled to a fair and reasonable allowance for their "care, pains and trouble and...time expended in and about the trust estate." The actual amount of compensation, however, is not set out. Determining fair and reasonable compensation involves an examination of each case in light of the fundamental principle that takes time and effort into account.
Although there is not a hard and fast rule to determine fair and reasonable compensation, over time our Courts have established some standard criteria to consider. It is now well established that Courts must consider the following factors in fixing the amount of compensation that will be allowed...
- the size of the estate
- the responsibility involved
- the time occupied
- the skill required
- the success achieved
Fair and reasonable compensation is sometimes calculated on a percentage basis of money that passes through an Executor or Administrator. In very general terms, it is unusual for this percentage to be less than 1% or more than 5%. When considering a percentage basis, however, Courts must consider whether such a formula will meet the statutory requirement of "fair and reasonable" compensation. The Saskatchewan Court of Appeal has warned against determining the amount of compensation by rigid application of fixed percentages. While percentages may be easy to apply and provide predictable outcomes, in some cases a percentage based fee will not bear any reasonable relationship to the actual time and effort used in managing the estate. For example, a small complicated estate may place more demands on an Executor's time and skill than a much larger, but simpler, estate. For this reason it is important to remember that a percentage based formula is only one measure and is not to be the determining factor.
Compensation may also take the form of a lump sum payment, or a mixture of a percentage and a lump sum, or even an annual allowance on its own or in connection with a percentage based fee. It may be necessary to treat different aspects of the estate differently, as different aspects may involve varying degrees of time and effort. Regardless of how the fee is determined, the amount arrived at must ultimately provide fair and reasonable compensation to the Executor.
Where a lawyer acts as an Executor or Administrator and provides necessary professional services to the estate, this factor will be considered and may result in the fee being increased to arrive at a fair and reasonable fee.
Finding the Will
In some situations it may not be easy to find out if a deceased person left a Will and where the Will was kept. If you are not sure if the deceased had a Will or you cannot find it with their papers, you may want to check with any lawyer that did legal work for the deceased to see if the Will was left with the lawyer for safekeeping.
A Will may also have been left with a courthouse for safekeeping. To find out if the deceased did this you can search the Wills and Estates Registry by sending a letter with the deceased person's full name, last known place of residence and date of death. There is a fee for a search that must be sent in with the request.
If you think someone has the Will you can serve notice on that person to appear in Court. The Court can order them to produce the Will. If the person does not have the Will, they can be required to state under oath that the Will is not and was never in their possession. They can also be required to give any information they have about where the Will is located.
|Beneficiaries cannot demand to be told what the Will contains and a reading of the Will to the beneficiaries is optional. In some cases the Executor, Administrator or the lawyer for the estate will meet with the beneficiaries to discuss the contents of the Will and outline the steps they will be taking to administer the estate. Although an Executor or Administrator does not have to show a beneficiary the Will they are required to distribute the estate according to the Will and there are ways, as the estate progresses, to make sure this happens.|
Challenging a Will
If there is doubt about whether a Will is valid, a request can be made to have it proved in solemn form. If this request is allowed, the court will hear evidence from witnesses such as people involved in the preparation of the Will or medical experts. An interested party may make a Court application to have the court determine the validity of a Will if...
- the Will was improperly signed or witnessed
- the deceased lacked the mental capacity to make the Will, or
- the deceased was unduly pressured into making the Will
Even if a Will is properly made, there are circumstances where the distribution of property under the Will can be challenged. There are even situations where a Will can be challenged because the deceased did not provide for someone who looked after him or her with the understanding they would benefit from the estate. This could happen if, for example, a relative gave up their own home and occupation to live with an older or disabled person with the understanding that they would inherit part of the estate.
Challenging a Will can be a complex matter and you will likely require the advice of a lawyer if you want to challenge the validity of a Will.
Checking on Distribution of the Estate
It is the Executor's or Administrator's job to make sure that the property of the deceased is given to those named in the Will. An Executor or Administrator who does not distribute the property as set out in the Will may be responsible for money or property that was improperly distributed. There are ways of checking to make sure that the Executor or Administrator has distributed the estate according to the Will.
In many cases the Will must be probated with the Court before any property is distributed. This must be done if distributing the estate requires any land transfers or if probate is required by an institution or organization holding property of the deceased. Even when a Will is not probated, banks and other institutions may require any beneficiaries named in the Will to agree to the release of money or property.
A Will that has been probated in Saskatchewan will be filed in the Wills and Estates Registry. Anyone can search this registry by sending a request and payment to the Registry, as described above.
If the Executor does not file the Will for probate with the Court within 60 days of the person's death, any interested person can serve notice on the Executor to appear in Court and produce the Will. At that time the Executor will also be required to accept the responsibility of being the Executor or allow the person who served the notice or other interested individual to apply to be in charge of distributing the estate.
A person interested in the estate may apply to Court for an order requiring the accounts of the estate to be filed with the Court at any time if they allege that the person distributing the estate has been negligent or is wasting the estate. The accounts are the records of how the assets of the estate have been handled.
If an Executor or Administrator is not fulfilling their duties or is defrauding the estate a court application can be made to have them removed.
Consent to Distribution
The Executor or Administrator is required by law to pass the accounts within two years of when Letter Probate or Letters of Administration were granted. Accounts also must be filed, even if two years have not passed, if the administration of the estate is complete or the Executor or Administrator wants to be discharged from their duties.
If the Executor or Administrator fails to pass the accounts when required, a beneficiary can serve a notice requiring them to be filed within 30 days. If the accounts are not filed within 30 days, a beneficiary can apply to the court for an order directing the Executor or Administrator to file the accounts.
If the administration of the estate is complete the accounts will include a proposed distribution. This distribution can be approved or, if a beneficiary objects to the proposed distribution, there can be a hearing on the matter. On the other hand, if all beneficiaries are willing to sign a release and they agree with the proposed distribution, the Executor or Administrator can ask the court to discharge them without passing the accounts. It is up to the individual beneficiaries to decide whether they will sign a release and agree to the proposed distribution. Beneficiaries can ask the Executor or Administrator for more information or for changes before agreeing to sign. If a beneficiary is not satisfied they can refuse to sign and then the accounts must be passed and ultimately the court can decide how the estate should be distributed.
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Wills and Estates Registry
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Phone: 306-787-5223ISBN/ISSN number: 1927-1778