Over the next twenty to thirty years, Canadians will experience a massive transfer of wealth from the Baby Boomer generation to their heirs. Wills and estate lawyers play a fundamental role in the transference of this wealth. This article addresses basic practical and technical issues of the probate process.
The Ontario government has made relatively no attempt to educate the public about the legal process and its complexities when dealing with the estate of the deceased. The purpose of a probate is to legally appoint an executor(s) by the court, so that the executor(s) can legally administer the estate and distribute inheritances to beneficiaries. But before any wealth transference can occur, an executor must retain a lawyer who understands the practical and technical processes of a probate.
The first step the lawyer undertakes is to meet with the executor(s) named in the will, or to discuss an appointment of an executor with the family in the case where there is no will. The lawyer begins by conducting an initial intake to gather information about the deceased, the executor(s) and the beneficiaries, and reading the will.
Once the will is read and preliminary issues are dealt with, the lawyer determines the proper jurisdiction of the court where the application is to be filed. Jurisdiction is determined by where the deceased lived at the time of death. Where the deceased died does not matter, although in most cases it is the same. Normally, a funeral home death certificate is sufficient to determine jurisdiction.
Once jurisdiction is established, the lawyer undertakes to assist the executor(s) to complete a full inventory of the estate at the date of death, and to categorize assets either as probatable or non-probatable. This inventory sometimes takes time, as the executor may have to conduct searches of the deceased’s property, which include obtaining financial records from financial institutions, appraisals of real estate holdings, as well as valuations of personal property and businesses. Once all assets are accounted for, they are then classified as probatable or non-probatable; at this time, the lawyer determines whether a probate is necessary.
Probatable assets are any assets that are owned outright by the deceased at the time of death. In contrast, non-probatable assets include assets held in joint tenancy, as a joint account, where beneficiaries are listed directly on financial instruments or where assets are shielded by a multiple will.
All probatable assets are valued to determine the estate administration tax or probate fee, which is 1.5% of the total value of all probatable assets in the estate. Once the tax is determined, a cheque is drawn made payable to the Minister of Finance, Ontario. This tax, which is the only monies the government is legally entitled to receive from the estate, is paid to the court at the time the court application is filed. The remainder of wealth in the estate is distributed to the beneficiaries under the will or by statute where there is no will, when inheritances are given out.
So how is a probate application prepared? The lawyer prepares an Application for Certificate of Appointment of Estate Trustee with a Will (or without a Will) and files it in the Superior Court of Justice, Ontario in the jurisdiction where the deceased lived at the time of death. With the application is attached supporting documentation such as the original will, Affidavit of Execution proving the validity of the witnesses who signed the will, a notarized copy of the will and notarized death certificate, Affidavit of Service to beneficiaries with the Notice of Application, and, most importantly, the Certificate of Appointment of Estate Trustee with a Will. Also submitted with the application at the time of filing is the cheque for the probate tax. Once the application is submitted, it goes before the registrar of the court. Upon review before the registrar, which could take between 2-6 weeks and even sometimes longer, depending on the volume in the court and other unanticipated issues, a Certificate of Appointment is issued and returned to the lawyer, signed and sealed by the registrar. This completes the probate process, with the exception of filing an Estate Information Return with the Ministry of Finance, Ontario, within 90 days of the signing of the certificate.
So why is it important to retain an experienced estate lawyer to prepare a probate. The main reason is that the preparation and production of a probate application is very technical. Mistakes can be made at every stage which could delay the receipt of a certificate for months. A lawyer trained in the detailed minutiae required to prepare an application with no mistakes is worth every penny of the retainer fee.
If you wish to have more information about the estate administration process or about wills and estate planning, contact Gary D. Indech at 905-636-8890 to speak to him directly, visit Gary at his office at 207 Mary Street, Milton or visit Gary’s website at www.indechlawchambers.com.