Top Seven Questions Canadians Ask About Estate Administration

Administering an estate can be difficult and bring about many questions.

Keep reading to learn the answers to the top seven questions Canadians have asked ERAssure

about their estates over the past five years. 

 

 Top Estate Planning Questions From Canadians

Q. What do "estate" and "executor" mean?

The executor is the personal representative of the deceased person and has essentially the

same rights, duties and obligations that the deceased person had while they were alive .

The executor is able to sue other parties, and is the individual that is sued by other parties in

respect to issues related to the estate. This may come as a surprise to family members who

thought the "estate" is a specific legal entity.

 

Q: I have a lawyer -- does his or her insurance cover the estate?

The lawyer's’ professional insurance covers the lawyer for errors made in the practice of law,

but does not cover the executor of the estate.

 

Q. Can an ex-spouse have a claim on the estate even though they were not named in the

will?

Given the frequent nature of divorce and remarriage, family law issues that may frustrate the

efforts of the executor trying to settle the affairs of the estate are not unusual.

Family law issues involve some tension. Lawsuits arising out of the executor or estate not

recognizing or providing for obligations under Family Law are not uncommon.

 

Q. What happens if the estate gets sued after the estate is distributed to the

beneficiaries?

There are statutory limitation periods that exist at law which represent dates after which no

claims may be brought against the estate. The limitation period may be as short as two years

from the last date of certain activities; in other cases, the window to sue remains open for much

longer. In order to claim protection under an applicable limitation period, the executor may be

required to pay a lawyer or claimant personally in order to defend or settle a claim. Ultimately,

some or all of the cost of defense may have to be "clawed back" from the beneficiaries.

claims may be brought against the estate. The limitation period may be as short as two years

from the last date of certain activities; in other cases, the window to sue remains open for much

longer. In order to claim protection under an applicable limitation period, the executor may be

required to pay a lawyer or claimant personally in order to defend or settle a claim. Ultimately,

some or all of the cost of defense may have to be "clawed back" from the beneficiaries.

 

Q. We are managing the financial investments and selling the real estate privately - do we

have a risk?

A growing number of people opt for “Do it Yourself” in an effort to reduce commissions related to

real estate or financial investments. DIY activities can cause the estate to lose some or all of the

statutory consumer protections which exist at law by using a licensed advisor or real estate

agent. This may mean that the estate is exposed to the legal liability risks that arise from these

activities – potentially expensive in the case of real estate sales.

 

Q. It looks like Dad made some serious investment mistakes and we think his estate may

be bankrupt. Should we be concerned?

Maybe not; there are established guidelines that the executor can follow to deal with a bankrupt

estate. One risk, however, is that there may be unsatisfied creditors that pursue the executor

after the estate has been distributed and the cost of defending yourself in such a case may be a

financial burden for the executor.

 

Q. Who pays when the estate gets sued?

Traditionally, it was acceptable to use the beneficiary's' money from the estate to defend and

pay for legal actions brought against the estate during administration.

Courts today are re-examining the traditional access to estate money in respect to lawsuits; they

may impose restrictions or prohibit the executor from using estate money to fund the cost of

litigation against the estate.

 

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If you’re looking for more answers about estate administration, you can find the full FAQ by visiting www.ERAssure.com or you can submit your question to ERAssure here.

 

You can also download other valuable estate resources from ERAssure such as the

Executor Guide or Will Preparation Guide.

For a list of ERAssure Estate Service Providers in your area

Estate Services Directory

Are you Currently Acting
as an Executor?

Executors can be held personally liable for actions they take in estate administration. Talk to one of our Estate Risk Professionals today for your free estate risk analysis.

1-855-636-3777   


Downloadable Resources

Want more information on planning, preparing and administering an estate? Download our easy to use reference guides and resources to help you along the way.

 

  • Executor Liability Insurance - Return the completed application to our office to find out if you are eligible for executor liability insurance.

 

  • Fiduciary Bonds - Have you been asked to provide a bond for the estate? Download the application and follow the directions to apply for a bond.

 

  • Free Executor Guide - If you have been asked to be an executor or are acting as an executor this guide will help you understand your responsibilities and help track your activities.

 

  • Free Will Preparation Guide - A step to step guide to the questions you will need to address when preparing your will.

  


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Did you know the executor of your estate has unlimited personal liability?

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ERAssure is the exclusive Preferred Supplier of executor E&O insurance for Canadian Bar Association members.

ERAssure® is the exclusive Preferred Supplier of Executor Insurance for clients of Canadian Bar Association members.