It is a common assumption among estate trustees that in order to administer an estate, a deceased's Last Will and Testament must always be probated; that is, submitted to the court along with an application and supporting documents in a process whereby the court examines such Will in order to determine its validity and authenticity, as well as to ensure that the proper estate trustees are appointed and beneficiaries notified. Where a deceased passes away without a Will, the probate process ensures that estate trustees are appointed in accordance with legislative rules.
A brief note on terminology: the term probate is no longer officially used in Ontario. It has been replaced with a Certificate of Appointment of Estate Trustee With or Without a Will, or, in other jurisdictions, Letters Probate or Letter of Administration.
Despite that where a Will exists the authority of the estate trustee(s) is derived from the Will itself, a Certificate of Appointment of Estate Trustee serves as an assurance to third parties that the estate trustees are the proper appointees and have authority to deal with the deceased's assets. For example, many financial institutions are reluctant to release the money to estate trustees without a Certificate of Appointment because of the liability that they may incur as a result of releasing money to an estate trustee under an invalid Will or an estate administrator who is not entitled to act. Equally, purchasers of a deceased's real estate will seek to ensure that a Certificate of Appointment of Estate Trustee has been issued prior to the closing of the transaction. Third parties rely on the probate process to ensure that estate property is being held by individuals with the authority to do so and is transferred to the appropriate persons.
Some assets, however, can be transferred without a Certificate of Appointment, either because of their nature or their ownership. These include vehicles and vessels, jointly owned assets (which pass by right of survivorship or must be dealt with in accordance with the Will under presumptions of resulting trust), real property falling under the first dealings exemption, and registered accounts with designated beneficiaries. Accordingly, it is important to ascertain the nature and ownership of the deceased's assets prior to commencing the probate process in order to ensure that estate property is dealt with in an expedient and cost-effective manner.
Crucially, whether or not a Certificate of Appointment of Estate Trustee is issued, estate trustees remain responsible for accurately identifying the deceased's property, ascertaining its value, ensuring that all taxes and debts are paid, and distributing such property in accordance with the deceased's Last Will and Testament or, where a person died without a Will, in accordance with legislative provisions.
Please feel free to reach out to any of Devry Smith Frank's estate administration lawyers to learn more about whether or not probate is required in an estate for which you have been appointed as trustee.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
