The executor of a will has many responsibilities, and they can be complicated if they are not understood. In this article, we will go through some of the main duties of executors in Ontario so they can understand their role very clearly. In most cases, being an executor is a rewarding experience that allows you to know that you are helping your friend or relative carry out their final wishes.
What is an executor?
The executor of a will has the responsibility of carrying out the wishes of the person who wrote the will. This does not mean that an executor is responsible for what’s written in a will — they are only responsible for carrying out its contents.
In Ontario, executors are considered trustees. This is because they are given the deceased’s property in trust. This means that they are responsible for administering the estate and distributing it amongst the beneficiaries.
The role of an executor
The executor is the person who has been appointed by the deceased to carry out their wishes after they pass on. They can be a friend or family member, or they can be someone from outside the family circle. A corporate executor may also be used for complex estates where there is no spouse or children who want to take on this responsibility.
Choosing the right executor is important to ensure that the process of administering your estate is carried out seamlessly. Although many people are tempted to equally divide the role of executor across family members, this is not always the best option. Certain family members may not have the financial prowess to adequately carry out the job or there may be tensions among the family members who are all tasked with the role. This is further complicated when all executors do not live in the same place.
Executors have a fiduciary duty to hold the estate for the beneficiaries. Some of the duties of the executor include avoiding conflicts of interest, fair and equal treatment of the beneficiaries and the proper and timely administration of the estate. Carrying out these duties may involve mediating beneficiary disputes and hiring professional advisors, such as lawyers and accountants, to assist with the job. In the following sections, we will address some of the responsibilities executors have in Ontario.
Overview of executor responsibilities
- After death, the executor should review the will immediately to determine the specific responsibilities that the deceased has taxed them with. This includes arrangements for funerals, burials and cremation. The executor may also need to arrange temporary care if any children or pets are involved, approve organ donation and secure various assets like the deceased’s home or business.
- The executor will need to obtain a death certificate, cancel any of the deceased’s accounts that remain open. This includes subscriptions, credit cards, memberships, passports, driver’s licence, health card and benefits such as a pension. Other parties, like banks, advisors and insurance companies, will need to be notified of the death as well. From there, the executor should list the deceased’s assets and seek legal advice to streamline the process.
- In the weeks after death, the executor should rely on the advice of the professionals they’ve sought out. They will need to arrange for the proceeds from life insurance, TFSAs and the like to be paid either to the estate or to the beneficiaries listed in the will. The executor will also need to follow up on any legal actions that the deceased was involved in.
- Several months after the death, the executor will still have things to do. They will need to transfer ownership of the estate, collect any debts owed to the estate, sell assets in accordance with the will, file estate tax returns and apply for compensation amongst other duties.
Executors receive compensation for their role
Yes, that’s right — executors are entitled to receive compensation for this job. The value of the estate is taken into account when determining how much they will receive. Executors may receive 2 percent of the first $500,000 or 2 percent of any excess over that amount (up to a maximum of $5 million). In addition to this fee, if there are any assets left over after paying out all debts and expenses related to administering the estate (for example taxes owed on an asset), the executor will also be paid 1 percent per year until all remaining assets have been distributed.
What if I don’t want to be an executor?
The process to be removed as an executor is not an easy one. If you do not want to be an executor, it is important to speak to a lawyer to start the process of removal as soon as possible. If you act as executor, you may be considered to have accepted the role.
If an executor wants to be removed, the executor must apply to the Court to be released from their duties. This is provided for in section 37 of the Trustees Act, which reads:
37 (1) The Superior Court of Justice may remove a personal representative upon any ground upon which the court may remove any other trustee, and may appoint some other proper person or persons to act in the place of the executor or administrator so removed.
If an alternative or co-executor is named in the will, the court will not need to appoint another person to act in this role.
Being an executor is a job to take seriously
As an executor, you have a great deal of power and freedom to make decisions about the deceased’s estate. However, it is crucial that you use this position wisely and according to law. If you don’t, you could potentially lose your authority as executor or even be held accountable for any problems that arise from your actions.
Here are some ways to use your position wisely:
- Pay attention to what is going on with the estate—know who is owed money and how much they’re owed so that everyone gets paid fairly and on time;
- Keep accurate records of all transactions related to the estate (bank accounts, investments, etc.); and
- Ensure everything happens in accordance with court orders or instructions from a lawyer.
Contact the Estate Lawyers at Derfel Estate Law in Toronto for Advice on Executor Responsibilities
At Derfel Estate Law, our estate lawyers can help you protect the financial, health and personal interests of yourself and your loved ones.
We provide strategic and compassionate advice and will take the time to thoroughly understand your specific concerns and desired outcome and will act accordingly while making sure all relevant parties are protected throughout the process. Call us at 416-847-3580 or contact us online to schedule a consultation.