You’ve been named as an Executor? What next?
Your role begins the moment your loved one passes away so it’s important to know what rights and responsibilities you have and how you should exercise those powers. They can be broken down into the following five steps:
Step One – Make funeral arrangements
Perhaps surprisingly, there is no obligation to consult with the deceased person’s family. Where practical to do so, it is still preferable to obtain their input, but the ultimate decision about what should happen to the deceased person’s remains lies with you. The funeral expenses are paid out of the estate and must be reasonable in all the circumstances. Unless you get a draft from the deceased’s person’s bank, you may have to pay those expenses first and seek reimbursement from the estate once the grant of probate is issued. This unfortunately could take months.
Step Two – Identify estate assets and liabilities
This is your first big task and one of the most important (and time-consuming) ones. The key thing to do is to keep a very clear, organised inventory of all the estate assets and liabilities. This is going to be vital if you are ever challenged. This could include property in Alberta, outside the province, or in another country altogether.
Step Three – Obtain a grant of probate if necessary
It is sometimes possible to administer an estate without a grant of probate but, in many cases, a grant of probate will be required in order to withdraw assets from financial institutions, or transfer land. It is an application that is made to the Court including the relevant forms.
Step Four – Satisfy debts
The next step is to ensure that all debts (testamentary expenses, taxes and other debts) are satisfied before the assets of the estate are distributed. Provided you are satisfied that the estate is large enough to pay all debts, you can pay the debts of the estate in any order. If there is any concern there may not be sufficient assets to pay them all, it is vital that you pay them in the order specified by the legislation.
It is also possible to advertise for creditors and claimants to ensure you find them all. Executors can be held personally liable for debts if they start distributing the estate to beneficiaries before all debts have been satisfied.
Step Five : Distribute the estate
The final step is to distribute the estate to the beneficiaries. You are entitled to be paid a reasonable amount for your work as an executor, taking into account various factors.
Whatever is left after the debts have been paid, including your compensation for acting as executor, should then be distributed. It is good practice to obtain a release from each beneficiary before distributing assets to them to ensure that there is no dispute at a later stage.
Whether or not that is the end of your responsibility, or just the beginning, will depend on whether there are any ongoing roles for you to fulfil, such as maintaining or administering any trust.
We hope the above information helps to get you started in your new role as an executor. If you need any more information, or would appreciate guidance along the way, our lawyers at Mountain Vista Law would be pleased to help you. Feel free to call us on (403) 981-000 and we can set up an appointment to discuss your options with you.
Article by Paul Manning
Although we are a law firm, this blog post does not constitute legal advice. It is for informational or entertainment purposes only and shouldn’t be seen as financial or legal advice of any kind. You should consult with a lawyer before relying on any of the information contained in this blog post. We can be contacted on (403) 981 0700 to set up a consultation with one of our lawyers who can review the specific circumstances of your matter and provide you with personalised legal advice.