How long does an executor have to settle an estate in Canada?

An executor appointed in a will is the personal representative of the deceased. It is an important role that comes with a lot of responsibilities. The executor’s tasks include handling the funeral, paying estate debts, locating beneficiaries, filing income tax returns, and distributing estate assets. It takes time to perform these tasks, and to do the job properly. But how long is too long to settle an estate? If you are an estate beneficiary, you may be growing impatient. Is there a time limit on the executor to fulfill their duties and finish the job?

BC Executor Checklist

Here’s a checklist of tasks that an executor in British Columbia, Canada, may need to complete:

1. Obtain a death certificate.
2. Notify beneficiaries and other interested parties of the deceased’s passing.
3. Locate the deceased’s will and any other relevant documents.
4. Determine the assets and liabilities of the estate.
5. Secure and value assets, including property, investments, and personal property.
6. File the will with the BC Supreme Court and apply for probate, if necessary.
7. Notify creditors of the deceased’s passing and settle outstanding debts.
8. File any necessary tax returns, including a final income tax return and estate tax return.
9. Distribute the estate’s assets to the beneficiaries according to the will or intestacy laws.
10. Keep accurate records of all transactions and decisions made on behalf of the estate.
11. Obtain legal advice and guidance as necessary.

It’s worth noting that the specific tasks required may vary depending on the complexity of the estate and the instructions laid out in the will. It’s also important for the executor to act with honesty, integrity, and transparency throughout the process.

Does the role of an executor have a time limit?

Because each estate is different, there is no hard deadline or time limit. The estate settlement process can take longer if the estate is complicated, or if issues arise (e.g., a challenge to the validity of the will, or a wills variation claim by a disappointed beneficiary).

Does that mean the timing for estate settlement is entirely up to the estate trustee?

No. Regardless of how simple or complex the deceased’s estate may be, an executor must not “unreasonably delay” in settling the affairs of the estate. In fact, an executor can be personally responsible for loss caused by inaction or undue delay. So, when beneficiaries think that things are moving too slowly, the question is why is it taking so long to wrap up the estate. Is the delay unreasonable in the circumstances? Was the delay caused by something the executor did or failed to do?

Estate Settlement Timeline

While there is no strict deadline, there is a general rule of thumb. In BC, an estate trustee has one year to gather the estate assets and settle the affairs of the estate. This is known as the “executor’s year.” It begins to run from the date of death, or from the date the probate application is granted (if it is necessary to apply to probate court).

Can an executor withhold money from a beneficiary in Canada?

During the executor’s year there is no obligation on the executor to distribute estate assets or any income earned on estate assets to beneficiaries. During that year, beneficiaries can’t compel an executor to pay cash gifts set out in the deceased’s will.

Why is the “executor’s year” necessary?

As mentioned, the role of an executor comes with a long list of responsibilities. The executor must take charge of the estate assets, apply to probate court if necessary, advertise for creditors, pay estate debts, notify beneficiaries, ensure investments are authorized, coordinate with banks and financial institutions, and keep accounts of the estate’s revenues and disbursements throughout the estate settlement process. The rule of thumb “executor’s year” recognizes that all these steps time, and that snags can arise that slow the process down through no fault of the estate trustee (e.g., dealing with foreign assets, real property sitting on the market with no offers, delays in processing probate court applications).

Another good reason for the “executor’s year”

Another very important reason for the executor’s year is that BC’s Wills, Estates and Succession Act (“WESA”) imposes a 210-day waiting period during which an executor must not distribute the estate without beneficiary consents or a court order. The waiting period is needed to allow time for any claims for maintenance from the estate—also known as a wills variation claim—to be brought. These claims can be brought by the deceased person’s spouse or children if they believe that the will fails to make adequate provision for them. A wills variation claim must be started within 180 days from the date the representation grant is issued and served on the estate executor no later than 30 days after that. If the executor distributes an estate before the 210-day waiting period has passed, he or she is exposed to personal liability if a maintenance claim is later brought. If the deceased’s will is challenged, the estate administration process is put on hold and the executor must not distribute the estate without the court’s permission.

What if estate settlement doesn’t happen within the “executor’s year”?

Ideally, the executor will keep beneficiaries informed as to the status of the estate’s administration. Not all executors follow this good practice. If the estate administration process takes longer than one year, and beneficiaries are not satisfied with the level of communication or with the executor’s performance of their duties, there are options:

• After the executor’s year has passed, a beneficiary can apply to court to compel the executor to pass their accounts. The judge will consider the situation and make an order setting the time and method of passing the accounts. If the estate is particularly complex, the courts may be sympathetic to the executor and accept that the executor needs more time.
• If accounts have not been passed after two years, a beneficiary can again apply to the court to require passing of the executor’s accounts. The executor will need to explain why the estate has not yet been settled.
• In some situations, a beneficiary can apply to court demanding payment from the estate.
• In more extreme cases, a beneficiary can apply to court to have estate trustee removed for inaction or undue delay.

Ways to speed up the estate settlement process

The estate settlement process can be sped up by good estate planning. There are many simple and effective steps that can cut down on how time-consuming estate settlement will be. “Inter vivos” transfer of real property or a bank account into joint tenancy is one option; these assets will automatically transfer to the surviving joint tenant after the death of the first joint tenant. If this is done during a person’s lifetime, there is no need for a probate application to transfer that property after their death. The use of trusts is another estate planning strategy that can streamline the process. Assets that are placed in the trust are owned by the trust, not the deceased’s estate.

Do you need help with the estate settlement process?

The estate settlement process can be time-consuming and stressful for both executors and named beneficiaries. Our team of estate planning lawyers and estate litigators can help you navigate the process. Contact us today for practical advice and effective solutions.