What is an Estate Asset?

Estate Asset Lawyers

We guide our clients through the intricacies of estate assets and the laws and litigation regarding them.

After the passing of a loved one, beneficiaries to an estate may be surprised to learn the assets held by the deceased person do not form part of the estate. Assets owned by the testator may be held jointly with another person or be placed in trust. At Onyx Law Group of Vancouver, we guide our clients through the intricacies of estate law and represent them in litigation proceedings.

What is an estate asset?

Individuals have the right during their lifetimes to give away property as they wish or to hold it jointly with another person. For this reason, beneficiaries may be surprised to learn which of their loved one’s assets are considered assets within the estate and which are not included in the will.

Sometimes, an individual may hold an asset jointly with another individual with the intent that the asset be distributed equally to all beneficiaries upon the individual’s death. When death occurs, however, the surviving individual may claim the asset was not in fact held in trust and other beneficiaries are forced to commence legal action to contest the claim that this was a gift.

A person’s estate will include only those assets that are in the name of the deceased person at the time of his or her passing. This means that assets held jointly and assets held in trust are outside the estate. Assets held in trust are administered by the trustee and assets held jointly at the time of death pass to the surviving individual. Similarly, insurance proceeds and R.R.S.P.s do not form a part of the estate.

Therefore, assets that were given to others as gifts or were placed in trust in order to ensure they were not subject to the provisions of wills variation actions do not form part of the will and are not inside the estate.

British Columbia Estate Asset Lawyers

At Onyx Law Group, we pride ourselves on our integrity, competence and passion for justice. We represent clients engaged in highly personal and emotional disputes that can also be legally complex. We take the time to listen to and understand our clients’ needs and use our legal knowledge and skill to find practical and effective solutions to meet them.

Free Consultation

We believe it’s important to know your legal rights and obligations before making any decisions. That’s why we offer 30 minute free consultations to give you the opportunity to discuss your matter with a passionate and knowledgeable lawyer who can advise you on the best steps forward.

Probate assets versus assets that pass around the estate

The single most useful distinction in this area is between property that passes through the estate and property that passes around it. Estate (or probate) assets are things the deceased owned alone in their own name — a solely held home, a bank account with only their name on it, investments, a vehicle, personal belongings. These are gathered by the executor, used to pay debts and taxes, and then distributed under the will or, if there is no will, under the intestacy rules in Part 3 of WESA. Non-probate assets skip that process entirely and go directly to a survivor: property held in joint tenancy passes by right of survivorship, and registered plans and insurance with a named beneficiary — RRSPs, RRIFs, TFSAs, pensions, life insurance — pay out straight to the beneficiary named on the plan.

The line has a direct cost consequence. Probate fees in BC are set by the Probate Fee Act and are charged on the value of the estate that passes through probate: nothing on the first $25,000, then roughly $6 per $1,000 up to $50,000 and about $14 per $1,000 above that — close to 1.4% on a large estate. Because those fees apply only to probate assets, assets structured to pass outside the estate are also outside the fee. That is a legitimate reason people hold property jointly or name beneficiaries, but it is also why the size of the “estate” is so often smaller than the family expected, and why disputes arise over whether an asset truly passed outside it.

Assets in more than one place, and digital assets

Where an asset sits changes the rules that apply to it. Real estate is governed by the law of the jurisdiction where it is located — its situs — not the law of where the owner lived. A Vancouver resident who owns a cabin in another province or a condo abroad usually needs a separate grant in that jurisdiction to deal with the property, which adds cost and time and can pull a foreign legal system into the administration. Personal property is generally governed by the law of the deceased’s domicile, but the situs of real estate is a hard rule, and planning that ignores it leaves the executor stuck.

Digital assets are the newer problem. Online accounts, cryptocurrency, loyalty points, domain names, and cloud-stored files can carry real value, but British Columbia has not yet enacted the uniform legislation some provinces are adopting to give executors a clear right of access. In practice, an executor’s ability to reach a digital asset depends on what the will authorizes and on the platform’s own terms of service, which frequently prohibit transfer. Cryptocurrency held in a wallet whose keys die with the owner can be lost entirely. Listing digital assets and leaving access instructions is one of the few ways to keep them from disappearing from the estate.

Why the estate line decides wills variation and creditor claims

This is where the classification stops being academic. A wills variation claim under section 60 of WESA — the route a spouse or child uses to ask the court for a larger share — reaches only assets that are in the estate. Assets that passed by survivorship or by beneficiary designation are generally beyond its reach, which is why a testator sometimes moves property into joint names or a trust specifically to shrink the pool a variation claim can touch. British Columbia courts do not always let that stand: through the presumption of resulting trust (the Pecore line of cases) a joint asset can be pulled back into the estate where the transfer was gratuitous and no gift was intended. Creditors follow a related logic — estate assets are available to pay the deceased’s debts, while some designated assets and insurance proceeds can be protected from them. Whether an asset is in or out of the estate therefore decides who inherits, who can claim a larger share, and who gets paid first. It is worth advice before, not after, the question is contested.