What's the executor's role with respect to assets that pass outside the estate?

Not everything owned by a person will form part of his or her estate upon death. For example, if the deceased was an owner of jointly owned property and the other joint owner is still alive, then the joint property is not part of the deceased's estate. The surviving joint owner will have complete ownership. This rule applies to joint real estate and joint financial assets, such as bank accounts.

Another example is an asset with a beneficiary that was designated by the deceased while he or she was alive. For most estates, this means an RRSP, RRIF, LIRA, life insurance policy and/or a pension. When the deceased passed away, the person named in the asset became entitled to ownership of the funds. (Note that this does not apply to an RESP, which behaves differently).

When assets owned by the deceased are going to be owned automatically by someone else and are not controlled by the deceased's Will, they are said to "pass outside of the estate". An executor is appointed by a Will to take care of the assets in the estate. So what is an executor supposed to do about the assets that pass outside of the estate?

The executor will not be able to deal with those assets as it will be beyond his or her legal role to sign the necessary documents or to receive the funds. The executor's role is more or less to provide notification, information and documentation to others so that they can deal with the assets.

The executor must let each of the holders of the assets - the holders being the banks, insurance companies, etc - know that the deceased has passed away. This should be done in writing by providing a copy of the Death Certificate. The funds will not be sent to the executor for handling and in most cases the executor won't even be kept in the informational loop about what is happening with the assets. But if the executor has in a timely manner provided the necessary information that allows others to get on with business that will cause the deceased's plans to be carried out, then the executor has fulfilled his or her duty.

In the matter of joint property, the executor can simply notify the other joint owner(s) of the deceased's death, provide a copy of the Death Certificate, and ask that the surviving joint owner deal with the asset. After that, it's up to the surviving joint owner to get the asset switched into their name alone.