British Columbia Probate Kit

Everything you need to probate or administer an estate

Mary-Jane Wilson, Lawyer
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L E G A L

S E R I E S

British Columbia Probate Kit

British Columbia Probate Kit

Mary-Jane Wilson

Self-Counsel Press (a division of) International Self-Counsel Press Ltd. Canada UsA

Copyright 2011 by International Self-Counsel Press Ltd. All rights reserved. No part of this book may be reproduced or transmitted in any form by any means graphic, electronic, or mechanical without permission in writing from the publisher, except by a reviewer who may quote brief passages in a review. Any request for photocopying, recording, taping, or information storage and retrieval systems of any part of this book shall be directed in writing to Access Copyright, the Canadian Copyright Licensing Agency. To contact them call 1-800-893-5777 (extension 235) or go to their website, www.accesscopyright.ca, for more information. Self-Counsel Press acknowledges the nancial support of the Government of Canada through the Canada Book Fund (cbf) for our publishing activities. First edition: 2011 Library and Archives Canada Cataloguing in Publication Wilson, Mary-Jane British Columbia probate kit / Mary-Jane Wilson. ISBN 978-1-77040-078-8 1. Probate law and practice British Columbia Popular works. 2. Probate law and practice British Columbia Forms. I. Title. KEB246.W45 2011 KF765.Z9W45 2011 346.711052 C2010-906933-1

Self-Counsel Press (a division of) International Self-Counsel Press Ltd. 1481 Charlotte Road 1704 North State Street North Vancouver, BC V7J 1H1 Bellingham, WA 98225 Canada USA

Contents

Introduction 1 Upcoming Changes to British Columbias Wills, Estates and Succession Act (WESA) 2 Personal Representatives
1. Executor 2. Administrator 2.1 Administration with will annexed 2.2 Co-executors and co-administrators 3. Executor and Administrator Fees and Costs 4. Doing It Yourself versus Hiring a Lawyer 5. Deciding to Act 6. Insolvent Estates

xiii 1 5 5 6 7 7 8 9 10 12 13 15

Responsibilities of the Personal Representative

2. Locating the Will

1. Dealing with the Remains and Funeral Arrangements 13

3. Care and Management of Assets 3.1 Prevent break-ins and theft 3.2 Secure assets 3.4 Search for unclaimed bank accounts 3.5 Business 3.6 Financial institutions 3.7 Mail 4. Guardianship of Minors 5. Pets 6. Dealing with Liabilities 6.1 Review lease or rental agreements 7. Cancellations and Notications 7.1 Cancel the passport 7.2 Cancel the Social Insurance Number (SIN) 7.3 Medical Services Plan (MSP) 7.4 Notify the Credit Bureaus 7.5 Utilities and other services 8. Accounting 9. Expenses 10. Small Estates

17 17 17 18 19 19 19 20 20 20 20 20 20 21 21 21 22 22 23 24 25 25 27 29 30 31 31 31 32

3.3 Locate vehicle insurance and vehicle registration 18

Preparing to Make an Application for Probate or Administration

1. Reviewing the Will 2. Information Gathering 3. Income Tax Returns 4. Canada Pension Plan (CPP) and Old Age Security (OAS) 4.1 CPP death benet 4.2 Survivors pension 5. GST/HST Credit 6. Life Insurance

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7. RRSPs, RRIFs, and TFSAs 8. Property Passing outside the Deceaseds Estate 9. Salary 10. Intestacy 10.1 Devolution of property 10.2 Intestate succession 10.2a Spouse 10.2b Separated spouses 10.2c Children 10.3 Intestate successors you cannot nd 11. Bonding

32 32 33 34 34 34 35 38 38 39 39 41 42 42 44 44 49 54 54 59 60 61 61 64 66 71 71 77 77

Probate Application
1. Certicate of Search of Wills Notice 2. Requisition 3. Notice of Intent to Apply for Probate 4. Afdavit of Notice 5. Afdavit of Executor 6. Renunciations 7. Additional Afdavits

Administration Application
1. Certicate of Search of Wills Notice 2. Requisition 3. Notice of Intent to Apply for Letters of Administration 4. Afdavit of Notice 5. Afdavit of Administrator (no will) 6. Afdavit of Administrator with Will Annexed 7. Renunciations and Consents 8. Security 9. Additional Afdavits

Contents

vii

Disclosure Statement for Executors and Administrators

1. Part I: Real Property 2. Part II: Personal Property 3. Part III: Debts and Liabilities 3.1 Safety deposit box 4. Part IV: Distribution of Estate

85 87 90 92 93 93 95 95 96 97 97 97 101 102 105 107 107 109 110 110 110 111 112 112 113 115

Filing the Documents

1. Swearing the Afdavits 2. Submitting the Documents 3. Probate Fees 4. Backing Sheets 5. Issuance of Grant

9 10 11

Creditors
1. Advertising for Creditors

Taxes Distribution of Estate and Transfer of Assets

1. Distribution of the Estate 1.1 How contesting the will can affect distribution 2. Transferring Assets 2.1 Real Property 2.1a Transfer of property to personal representative 2.1b Transfer to a beneciary 2.1c Transfer to a purchaser 2.2d Joint tenancy

12 Ofcial Administrator Glossary

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Samples
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 1 2 Application for Search of Wills Notice Requisition General Notice of Intent to Apply for Probate List of Heirs-at-Law and Their Address and Persons Served Afdavit of Notice Afdavit of Executor Renunciation Requisition (Administration) Notice of Intent to Apply for Letters of Administration Afdavit of Notice Afdavit of Administrator Afdavit of Administrator with Will Annexed Renunciation (Administration) Consent for Administration of Will Annexed Creditors Consent Statement of Assets, Liabilities, and Distribution Backing Sheet 43 45 46 48 50 55 57 62 63 67 72 74 78 80 82 93 98

Tables
Table of Consanguinity Intestate Succession 36 37

Contents

ix

Acknowledgments
I wish to acknowledge the following people who assisted me in the preparation of this book. Firstly, I must thank my husband, Tony Wilson, as he made the appropriate introductions, and without him I would not have had the opportunity to write this book. I also thank my children, Emma and Jeremy, who allowed me to spend the many hours necessary to write the book. I thank Jonathan Vogt and Susan Munro from the Continuing Legal Education Society of British Columbia (clebc). Chapters 5 and 6 adopt some passages from the British Columbia Probate and Estate Administration Practice Manual (Practice Manual) with permission from clebc. The Practice Manual is an excellent additional resource for those seeking more detailed information on probating or administering estates in BC. My assistant, Alena Walters, who typed the original manuscript and whose help I could not do without. Thank you to my accountant, Gordon Abercromby, who assisted me with some of the issues relating to taxes and cpp deductions on executors fees.

I also want to thank my editors, Tanya and Eileen, whose comments and questions made it a better book. Probate and estate administration is a complicated area and I hope I have demystied some of the procedures involved. It is a practice area I enjoy and work in every day. If you have any questions you may contact me at mjwilson@wilsonrasmussen.com Good luck! Mary-Jane Wilson

Acknowledgments

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Notice to Readers
Laws are constantly changing. Every effort is made to keep this publication as current as possible. However, the author, the publisher, and the vendor of this book make no representations or warranties regarding the outcome or the use to which the information in this book is put and are not assuming any liability for any claims, losses, or damages arising out of the use of this book. The reader should not rely on the author or the publisher of this book for any professional advice. Please be sure that you have the most recent edition. Note: The fees quoted in this book are correct at the date of publication. However, fees are subject to change without notice. For current fees, please check with the court registry or appropriate government ofce nearest you.

xii

Introduction: An Overview of Probate and Administration

Probate is the act of having the court legally establish that a will is valid. The will in your possession may look like a valid will but various banks and registries (e.g., land title, motor vehicle) will want the Supreme Court of British Columbia to validate it; meaning, the executor (the person named to perform the deceaseds last wishes) will need to probate the will. If the deceaseds estate is more complicated, contentious, or you just do not have enough time, you should consider retaining the services of a lawyer. However, if the estate is uncomplicated, and you have the time, you may want to tackle the paperwork necessary to obtain probate yourself. This book will guide you through the probate and administration process whether you decide to take on the job yourself or hire a lawyer to assist you. If the deceased left a will naming an executor, the executor will go through the probate process where necessary. If the deceased left no will, an administrator must be appointed and letters of administration must be obtained. If there is a will, but it is invalid or incomplete in some way, an administrator must be appointed and letters of administration with will annexed must be obtained. An administrator

xiii

performs a similar role to the executor of a will, but where there are no instructions in a will, the administrator must distribute the estate of the deceased according to the rules laid down by the Estate Administration Act [RSBC 1996] Chapter 122. Many people believe that if there is no will, the estate of the deceased goes to the government. This is not the case in British Columbia unless no next of kin can be found. The procedure to apply for letters of administration is similar to that of probate, but consents must be obtained from those who have a greater or equal right to apply to act as administrator and often a bond is required to be posted by the administrator to ensure that once he or she is appointed that the assets are protected. If there is a will, the testator (the person who made the will) chooses his or her executor, a trusted individual, so the court does not require a bond to be posted in this case. All wills do not need to be probated and all estates do not need to be administered. In British Columbia, estates with more than $25,000 require probate, but there are certain exceptions. Often the deceased holds assets jointly with someone else or appoints designated beneciaries under life insurance policies, tax-free savings accounts, Registered Retirement Savings Plans (RRSPs), or Registered Retirement Income Funds (RRIFs). These types of assets are not included in the deceaseds estate. They pass to the survivor or beneciary by operation of law. Many couples will hold all their assets this way so when one of them dies no probate or administration is required. If the assets held in the deceaseds name are worth more than $25,000, probate or administration will usually be required. For example, if the deceased held a vehicle in his or her name with a value of $15,000 and also had a bank account with $15,000, the value of the estate is $30,000 and it will require probate. However, in certain situations, nancial institutions will not require probate if the bank balance is more than $25,000, provided that the executor signs a letter of indemnity. This is often a standard bank form. The letter of indemnity will outline that if the nancial institution is wrong in recognizing that the will is valid and pays the bank balance to you in error, you will indemnify the bank or pay back the money you were paid in error. Various banks have different thresholds for using the letter of indemnity. If the deceased was a regular client, and had an excellent

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relationship with his or her banker, then the nancial institution is more likely to use the letter of indemnity. Some nancial institutions will insist on probate of the will if the value of the bank account is more than $25,000, even by $1,000. If there is no will, it is unlikely that the nancial institution will pay out the bank balance without letters of administration. If the only asset is a piece of land and it is less than $25,000, the Land Title and Survey Authority of BC will insist on probate of the will or administration if there is no will. For example, if the deceaseds only asset was 1 percent of a piece of property in British Columbia worth $150,000, the value of the estate is $15,000 (less than the $25,000 threshold), probate is still required. The probate registry is very particular about the documentation led with it. Remember, the will is the last word of the deceased, so the paperwork must be in order. The executor or administrator must be very careful to ensure everything is accurate and pay close attention to every detail. If you are appointed as an executor under a will, or you are considering applying to become the administrator of the deceaseds estate, you should review the executors duties before deciding to take on this role. It may be an honour to be appointed as an executor or you may feel some responsibility to apply to be an administrator, but be advised that acting as an executor or an administrator can be very challenging, and you should only take on this responsibility knowing that the task will be time-consuming and stressful. Once you begin the process of dealing with the estate assets, you are legally bound to complete the job, and you can only be relieved of your responsibility by a court order. The CD that comes with this kit includes forms for probate, letters of administration, and letters of administration with will annexed. The information provided in the book will help you choose what forms will apply to your situation. There is also a glossary at the end of the book to help guide you through the terms used throughout the book.

Introduction

xv

Upcoming Changes to British Columbias Wills, Estates and Succession Act (WESA)
British Columbias new Wills, Estates and Succession Act (WESA) received Royal assent on October 29, 2009. The new Act is expected to come into effect in mid-2011, but it is possible that further delays may occur. This statute amalgamates many of the statutes that govern estate administration in British Columbia including the Wills Act and the Estate Administration Act. The changes are an attempt to modernize the legislation that governs wills and estate administration. Some of the statutes have been on the books since the early 1900s. New Supreme Court rules are also expected to be drafted by the legislature before the WESA will be proclaimed in force. At the time of writing this book no new Supreme Court rules that govern the administration of estates have been nalized. The recommendations of the BC Law Institute are still being reviewed by the legislative drafters. The WESA and the expected new Supreme Court Rules are likely to come into force at the same time. If you are probating or administering an estate, you should determine whether WESA has been proclaimed into force as this will change some of the procedures outlined in this book. If you follow the old procedures, your application will be rejected by the probate registry and you will be expected to follow the new procedure. This will delay any grant of probate or Letters of Administration being granted.

This new act is a comprehensive statute designed to modernize and streamline the making of wills and the administration of estates in British Columbia. Wills made before the new act comes into force will not be invalidated, but the Act will apply to the interpretation of existing wills. Some of the key changes to the existing regime include the following: 1. A simplied procedure for administering small estates. A British Columbia Law Institute (BCLI) report recommended that the amount set be $50,000 initially. Currently estates dont need to be probated if they are worth less than $25,000. It is anticipated that an entirely new procedure will be available for all estates that are worth less than $50,000 if there is no real property (i.e., land or buildings) involved. The procedure will be simplied and make it easier to conrm your authority to deal with the deceaseds assets whether you are the executor under a will or want to be appointed as the administrator if there is no will. 2. The use of the term will-maker rather than testator. 3. The court will have power to declare a document which does not meet the formal requirements of a will to be effective as a will. 4. Marriage will no longer revoke a prior will. 5. The rules that apply in the case of an intestacy will change signicantly. The spouse will take an increased share, if there are children. Currently a spouse is entitled to the rst $65,000 and to a life interest in the spousal home; after WESA it is expected that the spouse will receive the rst $300,000 and have an opportunity to purchase the spousal home for a specied period of time. 6. Where two people die at the same time or in circumstances that make it unclear who died rst, there will no longer be a presumption that the youngest survived the eldest. 7. The denition of spouse will acknowledge both marriages and marriage-like relationships of at least two years, including relationships between persons of the same gender. 8. The intestacy regime will be changed to a parentelic distribution scheme, in which the descendants of parents take priority
British Columbia probate kit

to descendants of grandparents. Under the current intestacy rules, where there is no spouse or descendants, the persons in the nearest degree of consanguinity share in the estate. 9. In lieu of a life estate in the spousal home, on an intestacy, a surviving spouse will be entitled to an option to purchase the spousal home within a specied period of time.

10. Abolishing of the presumption that a gift by the will-maker during his or her lifetime to a child is an advancement of a gift in the will. Instead, such a gift would take effect according to its terms.

Upcoming changes to British Columbias Wills, Estates and Succession Act (WESA)