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Wednesday, June 8, 2011

What can I do about an executor who won't say whether she has the clearance certificate?

A reader asked me the following question about an estate:

"What can be done if an executor refuses to say if they have a clearance certificate or not as they are using it as an excuse not to distribute assets? Only an executor can check status via CRA but it's been over 8 months already and I a wondering how I'll know when she receives it if she is unwilling to say?"

First of all, I have to assume that you are a residuary beneficiary of the estate, because those are the only people with a right to ask questions like this of an executor. If you are not a residuary beneficiary, you are out of luck and have absolutely no way of forcing the executor to tell you anything.

Let's look at the 8 months issue. It really does take an unbelievably long time to get a clearance certificate from CRA, and many an executor has been wrongly accused of intentionally delaying an estate while waiting for the certificate. There isn't anything an executor can do to speed this up. Keep in mind that if it takes 8 months to get a clearance certificate, that doesn't mean 8 months from the time the person died. It means 8 months from the time the executor applied for it. The executor is not able to apply for it until the estate is wound up, which could be a year after the person died, meaning the clearance certificate might not turn up until 18 - 24 months after the person died.

I don't know anything about the specific estate you are involved in, but I can tell you about the general rule known as the executor's year. It may apply to your situation. The concept of the executor's year states that an estate without complications (such as a lawsuit or claim, difficult corporate winding-up, etc) should be completed in a year. If it it not, the residuary beneficiaries have a right to take the executor to court to push for their inheritance to be distributed. There may also be legal consequences for the executor, depending on the facts of why he or she has failed to distribute the estate.

Don't try estate litigation of any kind without an estate lawyer. Check with an estate specialist in your area to see whether this option is open to you, and if so, how to go about it.

35 comments:

  1. The executor we are dealing with says that we have to wait for the 3rd person ( The estate was divided between 3 people) to sign off before she can give us our part of the money. The tax clearance certificate has been dealt with. But for some reason the executor keeps saying that we need to wait for that 3rd person to sign off on the papers. And the problem with this is that the 3rd person is apparently in italy and they cannot get ahold of her which is completely delaying the process of me receiving the money. I was wondering if she was allowed to do this ? I dont understand why I need to wait for another person to sign off on their money for me to get mine.

    i was hoping maybe you could give me some insight as i am not to familiar with the estate laws

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    1. Hi, the short answer is that yes, the executor can do this. But I am going to make a new blog post today (October 5, 2012) to explain why. Great question, by the way.

      Lynne

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  2. I inherited money and oil right shares 50% with my brother from my grandmother in 2008 who lived in Winnipeg. We have been recieving royalties from the Oil Company for 4 years as they deem us the beneficiaries as the estate lawyer sent them a copy of the will. Now they want to drill another well and it turns out that the title of the rights were never transferred to our names. So the oil company instructed the executor to sign on our behalf to go ahead with this endeavor. If the estate is closed (per the final accounting, the release to executor and the clearance certificate) then is he authorized as "former executor" to sign on our behalf? My American lawyer (I am a Canadian/US legal alien living in Alabama) says in the US, the estate would need to be re-opened in order to "re-instate" him granting him authority to sign on our behalf until the title changes (which could take 2-6 months). In reviewing the Final Report from the estate lawyer, there is no mention of the shares in the list of assets. Nor in the release to Executor. Is is not standard to include the title change as part of the execution of the estate? Apparently, the oil company requested that the estate lawyer change the title in a letter in 2008. Nobody has offered me an explanation as to why it did not happen then nor in the four years since. The estate lawyer has jumped on taking care of this immediately in the last week in response to the request from the oil company and myself. It is my understanding that the oil company told the former executor to go ahead and sign on our behalf. I am all for a speedy exploration for more oil, AND I want to make sure that this is all correct. And that in fact, there is nothing else that has not been included. Do oil rights not constitute being listed as an asset in an estate accounting? Is it an oversight? If the estate needs to be re-opened, then I want to take advantage of the opportunity to review the files more closely. Help. I need a Canadian lawyer, I think.

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  3. hi ,in ontario canada ,how long after a death do i receive a inheritance letter from a formal will?

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    1. This can vary from a few months to a couple of years, depending on the circumstances. Where there is a lawsuit or someone is contesting the will, don't hold your breath - it will be a year or more. If the estate is not contested but is complex (meaning business to be wound down or sold, house in another country to be sold, etc), that too could take up to a year. Even where there really are no legal complications, an awful lot of executors drag their heels for no good reason and take longer than they should.

      Lynne

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    2. hi its a formal will , my grandma passed on dec.22 so i think my aunt can file her (my grandmas last income tax in 2013) shes my grandmas executor ,is she entitled to 20 % or only if it states she gets that(the 20 % just for being executor) in the will? i know my grandma wanted it devied all out evenly ..??

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    3. 20% is extremely high for an executor. The normal rate in Canada is between 1% and 5%. You're right though that if the will says she gets 20%, then she can claim that, plus expenses. Testators have the right to pay their executors more if they want to.

      Lynne

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  4. Executor that does not want to share information about the will or tell all of her siblings that she's the executor. Also, packing up all clothing but at the same time saying if anyone purchased or loaned something can come and pick it up-it's hard when things are being packed. Offered to help with packing clothing and it was denied. Can a husband of the executor be there at the deceased person's home? as the siblings seemed to not be able to go.

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    1. If she's not willing to tell people she's the executor, are you sure that she really is the executor? Assuming she is, then she has the right to exclude anyone and everyone from the house because she becomes responsible for every item in the house. Yes, she can let her husband in, but if he causes anything to go missing, she is legally responsible for it.

      Lynne

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  5. my children and their cousins are the beneficiaries of their grandfathers will. the will was read May 25th 2011. two executors were appointed, one the grandfathers old accountant and 2 his youngest son. the settlement of the estate has dragged on for almost 2 yrs. the biggest problem is the son executors also owes money to the estate by way of a mortgage on his business. he has sidestepped paying this out, refused to remortgage to payout the estate mortgage, listed property way over value so in 2 years it hasn't sold so executor 1 the accountant cant order the CCRA certificate because estate is not settled, in the meantime lawyer, both executors are getting paid out fees and expenses which is depleting the account the money is being held in.isn't there a conflict of interest here? can this keep going on much longer?

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    1. Sounds like a bit of a mess, and yes it probably could go on longer if nobody lights a fire under these two executors.

      Are your children or their cousins minors? If so, try talking to the Office of the Public trustee. They often get involved in estates on behalf of children who are minors. They may be in a position to put some pressure on the executors.

      If that's not an option, the only thing that is going to get this thing moving is an application to the court to force the executors to take action. Two years is definitely long enough. A judge might impose deadlines on the executors, or order them to take certain steps. This lawsuit would be brought by the beneficiaries. Make sure your children see an experienced lawyer before making a decision about litigaton. It can be painful, lengthy and expensive and shouldn't be undertaken lightly.

      Lynne

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  6. I was a joint executor of my father's estate. My siblings signed their rights over to me to act on their behalf. It has been close to a year since our father's death and I am still waiting for info form CRA before I can proceed and apply for a Clearance Certificate. My siblings seem to think I am intentionally dragging things out, however I am proceeding with each step as soon as the last one is completed. How can I make them understand that the time frame to complete this is out of my control?

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    1. This is a problem for a lot of executors. Beneficiaries, by and large, get pretty suspicious of executors, for various reasons. Over the years that I've been involved in estates, I have seen executors and beneficiaries alike disbelieve me when I tell them it will take several months to get a clearance certificate.

      I suggest that you follow up with CRA in the next few days, and send a summary of your follow-up to the beneficiaries. If you send an email to CRA, copy it to the beneficiaries. If you phone CRA, send the beneficiaries a summary of what you found out. Be pro-active with giving them information and it will help to manage their expectations.

      Lynne

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  7. how does one find out if they are included in the will. My sister was poa , but i have yet to hear from her it hs been a year since mom died

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    1. Hi Leftout,

      Do you know for sure that your sister is the executor? The fact that she was POA doesn't give her any right to look after the estate after you mother passed away. Do you know for sure that there is a will, and that your sister has it? If not, ask her these direct questions.

      You should be aware that only people named in the will are entitled to see the will or be notified about it. This may mean that you are not in the will. However, it's pretty rare that a parent disinherits a child, and it's logical that you should be included.

      I would start pursuing this right away, as there is little point trying to get your inheritance if someone spends if first. If your sister admits that she is the executor named in a will, ask her for a full accounting of what she has done so far.

      If you do not get cooperation from your sister, you might consider going down to the courthouse nearest where your mother lived to do a search. Find out whether anyone has applied for probate of your mother's will. If so, there will be documents including the will as well as a list of assets and debts.s

      Lynne

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  8. How do you know that an executor has included all assets and money in the final dispursesments of the estate. ( Meaning: leaving something out without beneficiaries knowledge of all the assets)

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    1. The only real reassurance that you have is that the inventory of assets provided is part of a statement sworn under oath. An executor who lies is committing perjury.

      You have to read the documents provided by the executor carefully, check the math, and look back at the inventory of assets provided at the beginning of the estate to see if anything has been left out.

      Some executors do get away with fraudulent or negligent actions that lead to losses for the beneficiaries. Sometimes the beneficiaries just don't catch the mistake (or the deliberate lie, as the case may be).

      At other times, the beneficiaries know something is off, but either don't want to, or can't afford to, challenge the executor in court.

      Lynne

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  9. Hi, Do you have to have the certificate of clearance first, in order to do a final tax return of a deceased person?

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  10. Do you have to have the certificate of clearance in hand before you can do a final tax return for a deceased person?

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    1. No, in fact you cannot have the clearance certificate if there are still returns to be filed.

      Lynne

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  11. Hello My eldest of two brothers is the executor of my fathers Estate. He recently received a letter from FMEP (Family Maintenance Enforcement) regarding the moneys owed by my other brother for child support. Stating that the Executor must issue any moneys owed to my Dead Beat Brother be paid to FMEP. Can FMEP hold Executor Brother legally responsible if he does not pay? Is the Executor viewed as an income provider? Does FMEP have the rights to ask for accounting information regarding Estate to verify the amount owed to Dead Beat Brother?

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    1. No, the executor is not an income provider. However, the executor does have the legal responsibility to use the estate funds to pay debts as far as those funds will go. Yes, they can ask for accounting information, but a summary should do. They will only want this information if the executor tells FMEP there isn't enough money to pay them. They will be looking for a) what assets were in the estate, and whether those assets were handled properly by the executor, and b) whether the executor has paid some debts that perhaps rank lower than FMEP in priority, and c) whether the executor has paid anything to beneficiaries. In other words, if the executor has made any mistakes that mean FMEP aren't going to get paid, then he may be on the hook for paying the debt out of his own money.

      Lynne

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  12. My separated husband has died and apparently disinherited his minor daughter and myself (current spouse). We were not informed by his lawyer or his executor/executrix (his daughter from his first marriage) of his passing or sent a copy of his will. When we learned of his death (it was an expected death), we asked the executrix to provide us with an estate viewing. Her response was she wanted to know what we meant by that. Her responses also include several references to her having and following legal advise. The legal advisor, has complaints filed about him at the law society. The Excutrix has demanded a walk through of our home, that my spouse has moved of his own choosing from in Aug 2013. Should I allow, or is this a disruptive shopping trip? The executrix and her mother (my husband's ex), are not on good terms with us, at all.
    I wish to contest the Will, there is not going to be provision (or adequate provision) for our minor child, likewise for me the spouse. During separation my spouse would not declare his full income, thus he never paid any child support or spousal support.

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    1. I'm not surprised that the executor asked what an estate viewing is. I don't know what it is either.

      I don't have any idea why you included the fact that the lawyer has complaints against him, since it's not relevant to your question or your situation.

      I have concerns about the executor taking a walk through your home. She has a right to access of all assets belonging to the deceased, but does he still own the house? I think we may assume that he no longer owns any of the contents, since he moved out almost two years ago. If his name is on the house, then she needs to be able to set a value for the estate inventory.

      However, things are more complicated than that. In addition to anything you may or may not have been left under the will, you have rights under provincial matrimonial property law (assuming you're legally married and not common law) and that has to be decided first.

      Also, if you and/or your daughter have been left out of the will, you both have an automatic right to claim against the estate even if you're not mentioned in the will. That also has to be done before the estate is finalized.

      You need to talk to a lawyer who can look at all of the facts and paperwork. You may be giving up some important rights under matrimonial and estate law if you don't see someone. Be prepared for a long meeting with lots of number crunching.

      Lynne

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  13. What steps do I take to stop the disbursement and disposal of an Estate where the Will has not yet been probated, and there will be contesting of the Will? As this Will, will be contested, how long legally must the Executor keep the estate intact? Can the Executor do an interm disbursement of goods or funds, when the current spouse (separated) and minor child have not been informed or settled? What are the consequences, if information of the estate has been withheld to the current spouse? What does the current spouse do about an adversarial Executor (with an equally adversarial lawyer)? Is contesting the Will more likely to succeed if I immediately (with circumstantial evidence - no Will copy), file a motion to stop the dispersement/disposal of Estate? The Executor has admitted to dipersing goods out of country, and disposing of goods, so is she responsible to replace or compensate the value? How do we persuade the Executor to provide us with copies of family digital photos and heirlooms that are significant only to us, befor they are disposed? If the deceased has written a letter of promise prior to his current will, can the minor child claim the item(s), since a sum was exchanged for the promissory note?

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    1. Ok, you're asking a ton of questions here, so I really hope you will get a lawyer of your own to talk with. I'm going to talk about this here on the blog a bit, but if someone came into my office with all of these questions, I would devote at least an hour or two to discussing it. I'm just telling you that so you realize I can't possibly do your questions justice in this forum.

      The first thing that occurs to me when reading your note is what you mean by "there will be a contesting of the will?" Have you filed anything at the court? You can't blame an executor for getting on with the estate efficiently if he or she has no idea someone is going to contest it. If you're going to contest it, then do it.

      The executor should give notice to the spouse of the deceased (note that in some provinces, common law spouses are not considered beneficiaries of estates unless they are specifically named in the will) and to the representatives of minor children. However, that notice is usually sent out at the time the will is sent for probate, so if as you say the will has not yet been probated, the notice may not yet have been sent.

      Without the probate, the executor won't be able to deal with all assets, most notably any real estate. However, if any of the deceased's assets were held in joint names, there is no need for probate to deal with those. There is nothing you can do to hold up those assets because they are not part of the estate.

      Normally an executor must keep estate assets together, with the exception of paying bills, for six months after the grant of probate or until a) the spouse advises that he/she won't make a claim, or b) the spouse makes a claim.

      It appears to me that you might consider making a claim for dependent relief - i.e. a larger share of the estate than is given under the will. I realize you don't actually know what you are given under the will, if anything, but if assets are being distributed you may assume that they were not left to you.

      You need a lawyer. And you need one quickly.

      Lynne

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  14. If the Husband dies 2 days short of 2 years since the Separation action was commensed, and the trial for divorce is set for the spring of 2016 (10 months from his death). Does the Separation Claims that were filed 2 years ago prevail or take priority over the Will of the recently deceased?

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  15. If the deceased wrote a Will or did a transaction days before his death, (POA may have done transaction), can it be invalidated due to Deaceased being incompetent and Executor (POA) being biased for personal interests?
    If Physician indicates verbally that person is 'severely mentally deteriorated', how does the court view? Is this evidence required in writing? Can medical records be subpoena to support, or Dr.s called as witnesses if they don't want to be?involved?

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    1. This is really a collection of very different questions. I'm going to start with the power of attorney (POA).

      Since the deceased had a POA, it would be appropriate for the person named to do transactions for the deceased. If it was an ENDURING (or continuing) power of attorney, no it would not be invalidated by the deceased being incompetent. In fact, the possibility of incompetence is the reason the POA was signed in the first place.

      There are different ways for a POA to be brought into action. Those that are "springing" usually need a brief certificate from a doctor attached. That doesn't require the doctor or anyone else to appear in court. The documents are designed for that purpose.

      In other words, mental incompetence is part and parcel of using a POA.

      You mentioned that the executor might be biased for personal interests but that really doesn't tell me anything. I don't actually know whether you mean the POA and the executor are the same person, and he may have done a transaction that personally benefitted him, or whether you mean that he influenced the making of the will. I could write a book on those subjects (in fact, I already have) so if you want an answer on that, please give me some details to go on.

      Now, on to your question about the deceased making a will shortly before his death.

      It's possible that a will made shortly before death could be invalidated on the basis that the deceased did not have the required mental capacity to make a will. Mental capacity is required at two times - when the will instructions are given to the lawyer, and when the will is signed.

      It goes without saying that there must be something about the will that is different from wills made earlier by the deceased - something that is illogical, or seems to have been influenced by someone. Usually it's a will that gives all, or at least a large portion, of the estate to one person.

      If you decide to challenge a will based on lack of capacity, the medical evidence is extremely important. Yes, it will have to be in writing. Most likely it will have to be in the form of an affidavit sworn before a commissioner for oaths, with proper medical records attached to it. Yes, medical records can be subject to subpoena if there is a trial.

      There is really a lot of ground being covered in your question. I really think you should sit down with a lawyer - and please find one with estate litigation experience - to show him/her all of your documentation. Trying to contest a will based on lack of capacity is not impossible, but it is difficult and lengthy, and you should get a legal opinion based on much more detailed facts than you've given here. It does sound as if you might have something to go on.

      Lynne

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  16. Is a minor child a dependant that must be adequately provided for in an Estate irregardless of not being named in the Will or given an pitance of the Estate. What sum is considered necessary for a minor child to recieved from an estate if the funds are available? Does the child's best interests get served prior to all other claims on the estate? What about the legal wife? What if the legal wife was separated? What if the Executor is obstructive?

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    1. Yes, a minor child of the deceased (either biological or adopted, but not step-child) is always a dependent of the estate. If the child is left out of the will or is not adequately provided for in the will, the child automatically has the right to ask the court for more of the estate. This right to ask for more is generally called "dependent relief" and exists in every province and territory in Canada.

      No, the child's claim doesn't necessarily come before everyone else's. Other claims that could compete with the child are claims by other minor children, claims by a disabled adult child, claims by the spouse of the deceased, and in some circumstances, claims by former spouses of the deceased. The court would balance all of these claims, as well as balancing the wishes stated in the will.

      The fact of separation doesn't by itself preclude a wife from a claim under the estate. However, as you can imagine, it changes the details of the claim. It's all about being supported in an appropriate manner, and if the wife has been separated for a while and is doing ok financially, it's harder to show the need for support. However, don't walk away from dependent relief help from the estate without sitting down with an experienced lawyer and going over the numbers!

      There is no set number for what is considered adequate support for a minor child. Setting the amount in court will involve setting a budget, explaining expenses, and possibly an examination of current finances.

      What if the executor is obstructive? Well, that's nothing new. The executor won't be happy that someone plans to contest the will, drawing out his job and making it a lot harder. But he doesn't have to like it. Making a claim against the estate involves filing documents with the court and serving them on the executor. Even if he's hopping mad, you can still serve him.

      Lynne

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  17. Dear Lynne thank you for your website I have read it many times and it has been so helpful. My story is rather long and complicated but I was hoping for your advice. My sister was the POA for my Mother during which time she stole money. After much stress and financial costs we managed to have her removed as POA and reached a settlement where she repaid approximately 50% of the funds she fraudulently took. Sadly my Mom passed away in the summer and my sister is now back as the Executor. We know she has held a second memorial mass (which was not my Mom's funeral) but she has used my Mother's money to pay for. We no longer have finances to continue the legal fight and the estate we believe is pending while the tax certificate is received. Is there anything else we can do in the meantime and is there any other avenue for us to investigate without hiring another lawyer?

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  18. is there anyway to push the executor for early distribution if they wont

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    1. No. An executor is entitled to wait for the tax clearance certificate before distributing the estate. Most don't wait because they don't think there is much risk as long as they have held back enough for any possible taxes and expenses, but the do this voluntarily.

      Lynne

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  19. Hi Lynn: Thanks for our reply.We were rushed to sign the release as we had an appt. at the bank. I just got the Release and Will 2 days ago. First that I have seen it. Everything is here except for the Accounts info. None of us saw any paperwork the day that we picked up our cheques. So we didn't examine anything on that day. We all chatted outside about other things then were rushed in to sign and go. Of course none of us really read the paper we were signing because we were purposely rushed to leave. Also the release paper does not have a date on it. There are 5 siblings (I truly believe that 2 brothers scammed us). A rough guess would be that we were scammed out of $100,000. dollars each. Thanks for your help!

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