The role of an executor

Zoomer | January 1st, 2006

An executor is one of those people you will never need in your lifetime, but who will be extremely important to the family after death.

This is a person, or an institution, appointed in your will, whose duty is to administer and distribute the estate’s assets after a death. The executor is responsible for carrying out the deceased’s wishes. The selection of an executor is one of the first and most important considerations in the process of will preparation. Often Canadians select a family member, a trusted friend or relative, or a business associate to act as executor.

It is recommended that more than one executor be appointed. An alternate executor should be named, since, upon death, the named executor might choose not to take on this responsibility, or he or she may have predeceased. It is also important to obtain the consent of the individual or individuals appointed before naming them in a will.

At the simplest level, the executor’s duties are the same for all estates. However, given the complexity of a particular estate, they may appear very different. The tasks may be few, and simple to execute. Or they may be many and complex, and take years to complete. Irrpective of the size of the estate, the executor takes on great responsibility.

Here is a run-down of some of the responsibilities that are involved, and skills required. Let’s look at them from the perspective of someone who has just assumed an executor’s responsibility.

Locate and review the will
Your first priority as executor is to obtain the most recent original copy of the deceased’s will. Ideally, you will have been informed where it is, or you may already have a copy. If it cannot be located among the deceased’s papers at home, check the safety deposit box. This will necessitate calling the bank and making an appointment to come in to open the box. Bring the key, a copy of the death certificate (a burial certificate issued by the funeral home may suffice), and your identification. If the will is there, confirm that you are indeed named as executor. If so, you should be allowed to take the will with you. A bank employee will make a listing of the contents of the box and will give you a copy of it. Ironically, a safety deposit box is a poor place to keep a will, for just this reason.
Organize a meeting
Organize a meeting of the deceased’s family, to review funeral arrangements, and allow you to confirm the whereabouts of insurance policies, investment statements, safety deposit boxes, share certificates, etc.

Arranging the funeral
Assuming the funeral has not been pre-planned, one of your first major duties as executor may be to assist with funeral arrangements. The funeral is one of your direct responsibilities as executor. You will, no doubt, want to consider the deceased’s wishes as expressed in the will or elsewhere, and the wishes of the immediate family.

After the funeral, the funeral bills can be presented to the deceased’s bank. The bank will give you an official cheque drawn on the deceased’s account to pay the funeral home. Financial institutions will generally permit cheques to be drawn on the deceased’s account, with minimal documentation, as long as these payments are for the funeral, and medical bills incurred immediately prior to the death. Much beyond these, the financial institution will demand that all their documentary requirements be met before releasing further funds.

Routine financial matters
Cancel all the deceased’s credit cards, subscriptions, etc. Utility services may need to be terminated. If the deceased is entitled to CPP and OAS, make application for whatever benefits there may be. Communicate with the deceased’s employer, if applicable, regarding any benefits that may have been available. Commence claims on any private life insurance policies that the deceased held. If you believe it to be appropriate, place an advertisement in a local newspaper asking creditors to come forward so that you can ensure that all of the deceased’s legitimate debts can be paid.

Beginning to manage the estate
Prepare an inventory of all of the deceased’s assets. Remember that any assets that were owned in joint tenancy with another person, or where a beneficiary designation had been made, such as with life insurance policies, RRSPs, and RRIFs, do not form part of the estate. Ensure that tangible assets are secure and that proper insurance is in force. In particular, ensure that homeowner’s insurance does not lapse because the home may be vacant.

Distributions from the Estate
Payments on behalf of the dependants of the deceased may be permitted. But you should not make any distributions from the estate during the first six months without the surviving spouse’s written consent, or an authorization from the Court. In fact, you should wait six months before distributing any assets to the beneficiaries, even if there is not a surviving spouse, because the deceased’s dependents have six months during which they may contest the will. Lastly, you may not make a final distribution of estate assets until you have a “clearance certificate” from CCRA or Revenu Quebec, certifying that the estate has no income taxes owing.

For assets such as marketable securities and real estate, Letters Probate or Letters of Administration are almost always necessary for transfer of title. Financial institutions will generally require “notarial copies” of Letters Probate/Letters of Administration before they will amend the registration of a financial asset, or disburse funds to the executor/administrator. This protects the financial institutions from liability arising from claims by other parties.

Keep detailed records
Ensure you keep full and accurate records of all transactions either in to, or out of, the estate account. If you are asked to do so, you must be able to provide a full accounting. Keep track as well of all your disbursements made in the course of your duties as executor. Lastly, when you do finally distribute the estate, obtain releases from the beneficiaries absolving you from any further claims.