Canadians face significant executor burden in settling estates

Traders Union
All News
Business & Wealth
Executor burden in estate settlement

Highlights

Executors often spend hundreds of hours managing estates, coordinating legal, financial, and personal tasks, and covering upfront expenses before probate completion.
Provincial rules may limit executor compensation if unspecified in the will, even though executors bear fiduciary responsibilities requiring prudent asset management and liability payments.
ClearEstate polling found nine in 10 Canadians view executor duties as complicated and time-consuming, with two-thirds deeming it unfair for a family member to handle alone.

Executor duties span legal, financial and personal tasks

As reported by MoneySense, settling a loved one's estate can involve hundreds of hours of work, from arranging funeral details and securing property to contacting banks, service providers and beneficiaries.

Executors also need to obtain death certificates, locate the original will and make sure insurance coverage does not lapse. In many cases, they must go through probate, the court process that validates the will and formally authorizes the executor to act, although that requirement does not apply in every situation.

Until probate is completed and estate funds are released, executors may have to cover funeral expenses, legal fees, accounting costs and other outstanding bills themselves. They are generally entitled to compensation for their time, but where the will does not specify an amount, provincial rules can limit what they receive.

The role also carries a fiduciary duty to protect beneficiaries' interests. Mark Biderman, senior vice-president of trust and legal at Cidel Private Bank, said executors must manage assets prudently, pay liabilities without wasting estate value and ensure investments and property remain properly overseen during what can be a lengthy administration process.

Financial strain and planning gaps raise the stakes

The burden can intensify when an estate is insolvent, because creditor claims may leave executors exposed to added pressure and risk. Complications can also increase when the executor lives in a different jurisdiction from the deceased, especially if collateral is required to act outside the province or if foreign assets bring another country's laws into play.

Recent polling commissioned by ClearEstate suggests many Canadians recognize the difficulty of the assignment while still feeling obliged to accept it. Nine in 10 respondents said the job is complicated and time-consuming, three-quarters said they would agree if asked, and nearly two-thirds said it is unfair to expect a family member to manage the process alone.

Experts say some of that pressure can be reduced through better preparation before death and more disciplined record-keeping afterward. They recommend reviewing the location of the will, banking relationships, passwords and other key information in advance, while executors should keep receipts, document conversations and consider outsourcing parts of the bureaucracy to professional firms when needed.

In our earlier article on a Malaysian Court of Appeal ruling on commission-partner liability, we explained how the court found a lawyer listed as a commission-based partner could still be treated as a “partner” under the Partnership Act 1961 and held responsible for a firm-related debt. We also noted the case’s broader implications for professional firms, as the decision signals that titles and how a firm presents someone to the public can affect personal exposure to liabilities.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.