Understanding Probate and Wills
An introduction to this important legal process.
The death of a loved one can be a time of overwhelming grief that is further complicated by the legal proceedings required to finalize a person’s estate. To make things a bit easier, hopefully, some planning has been done to ensure there’s a will with an executor appointed to carry out final wishes.
Dealing with a person’s estate is no easy matter and can come with a steep learning curve for many, since it usually includes a flurry of legal and financial documents, lawyers, accountants and even the court system.
An important part of dealing with an estate is a legal process called probate. Here we’ll help you understand what this is and why it matters.
What is probate?
Probate is where a provincial court of law confirms the validity of a will and the executor’s (also known as an estate trustee) authority to administer the estate. If the deceased didn’t have a will, the court appoints someone to act on behalf of the deceased.
When do I need to apply for probate?
Executors may find the probate process is necessary in order to access the financial accounts of the deceased. It’s not as simple as walking into a bank with a death certificate and asking for access to the funds. You can expect that financial institutions will ask to see court-approved documentation that proves you are the executor.
There’s a lot to comprehend when handling a person’s estate. This Government of Canada resource offers detailed information, including what to apply for, application deadlines and various provincial or territorial fees.
What happens if there’s no will?
Dying without a will is called intestate and can make it quite challenging to wind down an estate. When a person passes away without a will, provincial law decides how assets are distributed. The specific rules for asset distribution vary by province, so assets may not be distributed as you intended. In addition, if you have minor dependent children and there isn’t another surviving parent, the court will choose their guardian.
An individual can apply to the court to be given authority to act as executor. If no one is available or willing to be executor, then a public trustee may be appointed. Assets are frozen as the case moves through the system, and depending on the complexity of the estate, the process could take years.
Can I avoid probate?
It’s not required by law, but most wills in Canada can be expected to go through probate to ensure that things go as smoothly as possible during the final administration of an estate. Going through the probate process protects the executor from liability if the will is challenged, or if the estate is involved in any legal matters.
Probate may not be necessary for a very small estate and a financial institution agrees to release funds to the executor. You may need to apply for small estate status depending on the rules outlined by your provincial government. Probate may also not be necessary when bank accounts and property are jointly held and can pass directly to the surviving joint-owner, such as a spouse.
In Quebec, it’s interesting to note that probate is not a requirement for wills that are drafted by a notary, otherwise known as a notarial will. However, handwritten or holographic wills and wills made before witnesses do require probate.[1]
Do I need a lawyer?
A lawyer isn’t required to file for probate, but professional help might make the entire estate process a bit easier for an executor. A lawyer can help to ensure everything is in order and that things go as smoothly as possible. A good estate plan should identify a lawyer and accountant who the deceased trusted to help with the administration of their assets.
What are the fees involved with probate?
The fees involved with probate vary based on the size of the estate and where you are filing. Each province has its own probate fee schedule, and there may also be additional administration fees involved. Professional assistance provided by a lawyer or accountant will result in additional costs. If there is real estate in more than one province, then plan to file for probate and pay the necessary fees for each province involved. Please refer to this probate fee chart for more details.
How long does the probate process take?
An organized estate plan can greatly help in the probate process, beginning with a will that is easily located after death, and which also identifies the executor. Imagine a distraught family searching high and low for your will, or trying to figure out which lawyer you might have used, to see if they have a copy.
Once the necessary paperwork is submitted to the appropriate provincial court, you may wait weeks or even months for your case to move through the system. If there isn’t a will, then the probate process can take much longer - even years - depending on the complexity of the estate.
Probate and privacy
There may be instances where privacy is a priority and efforts are made to keep details of an estate confidential. When a will goes through probate, it becomes a matter of public record, and the details of the estate are available for anyone to see.
Generally, assets that aren’t part of your estate, aren’t part of probate. These assets can pass to their intended beneficiaries with increased privacy. This isn’t the case in Saskatchewan where insurance policies with a named beneficiary and jointly-held property must be identified as part of probate even though these assets don’t flow through the estate and aren’t subject to probate fees.[2]
It may not be possible to avoid probate if the estate is complex or if the will is challenged. In these situations, one way to plan ahead and protect how much of your estate is made public is through the use of a trust.
Assets that are in an existing trust, set up while the deceased was alive are considered outside of that person’s estate and are excluded from the probate process. Learn more about trusts here.
Beneficiaries and probate
Naming a beneficiary is important, especially when it comes to probate. Whether it’s a life insurance policy, investments such as a TFSA, RRSP, RRIF or segregated fund, or an employer pension plan the application process prompts you to name a beneficiary. Typically, a beneficiary is a spouse or other close family member that you would like to have receive your assets after you’re gone.
By naming a beneficiary (or beneficiaries), these assets bypass probate. Without a beneficiary, these assets are included in probate process and frozen until the case is processed. This can be an incredibly difficult situation, especially when a family may need a life insurance payout to cover living expenses.
Carrying out the final wishes of a loved one can be emotionally exhausting, time consuming and confusing, but a good estate plan can go a long way toward making this important process much easier. When it comes to estate planning, wills, what’s involved in being an executor, probate and more, speak with your advisor. For additional information, check out these resources:
You’ve been asked to be an executor… now what?
The value of naming a beneficiary
[1] Probating a will in Quebec, 2023
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