How Does Probate Work in Ontario? Jeff & Katie

During estate planning, the subject of probate is bound to come up. It’s an important, yet sometimes confusing legal process deeply entrenched into Canada’s guidelines for inheritances and succession planning.

If you have assets that include real estate, your estate will go through probate before your beneficiaries can receive what’s rightfully theirs. Since probate isn’t something we can always avoid, this post is dedicated to answering your most pressing questions.

Do you need extra support during a sensitive transaction? Our detailed seller’s checklist can help you stay on track.

What Is Probate?

The more cynical among us will state that it’s just another way for the government to get their share of your estate. While this may be true to a point, anyone with valuable assets understandably wants to protect them until ownership successfully changes hands.

Essentially, probate is permission granted by the courts for the Estate Trustee (formerly, and still sometimes known as Executor) to distribute your belongings according to the terms you outline in your Will. Before granting probate, the courts will verify that the Estate Trustee is who they say they are, and that they are willing and able to perform their duties as required. During this time, they’ll also make sure your Will is genuine, up-to-date, and a true, legal reflection of your wishes.

In any kind of transaction, the first step is a basic understanding of how real estate works. That’s even more true when facing a challenging situation. The posts below can help:

How Does Probate Work?

You should begin thinking about probate before you or your loved ones are actually facing it. First, the estate holder chooses an Estate Trustee to handle their affairs after they are gone. For everything to go smoothly, they should also have a clear, legal Will that is uncontestable. An experienced family lawyer can help with this to ensure all terms are above board.

Keeping all account numbers and important documents in one place known by the Estate Trustee will also streamline the process. Otherwise, they will be scrambling trying to make sense of things, all while facing their own sense of loss.

After the estate holder passes away, the Estate Trustee has many responsibilities to juggle all at once. These include:

Locating the Will
Finalizing a complete inventory of the deceased’s belongings and assets
Applying for probate
Managing the estate until it is fully settled
Notifying beneficiaries of their inheritance
If applicable, selling the family home

The courts will issue a Certificate of Appointment of Estate Trustee, which formally recognizes their authority to transfer or sell assets, pay off any debts and income taxes and finalize the estate.

What is an Executor (Estate Trustee), why do you need one, and how do you find one? All those questions and more are answered in the posts below:

When Is Probate Required?

Probate isn’t always required for everyone. However, the moment someone holds real estate solely in their name (and not in joint tenancy), owns any asset that requires third party involvement, or there is a dispute over the Will, probate must be complete before the estate can be settled.

The longer probate takes, the more money goes to lawyers and courts and less to the loved ones left behind. That’s one of the many reasons estate planning isn’t just beneficial; it’s really non-negotiable.

For example, you can avoid probate on certain assets, such as investments and cash in bank accounts, just by assigning a beneficiary. It’s more complex with large assets like real estate, but there can be ways around it. For example, you might consider setting up a trust or putting someone on title with you. These options come with a myriad of legal and financial complications, so we recommend that you talk to a lawyer before making any decisions.

At the end of the day, the best way to handle probate is to plan carefully and have all of your affairs in order while you are still healthy and of sound mind. Then, you can rest assured that your loved ones will be taken care of and be able to move on with their healing process after you are gone.

Do you want to know more about how to handle probate? The posts below can help:

What Does Intestate Mean?

Intestate simply means dying without a Will. Many of us plan to be around forever with our loved ones. As a result, some people never get around to making their Will. Or they get too busy, with the best intentions to do it later, or the topic is just too painful and easy to put off.

Whatever the reason, the real question is what happens next?

Why Do I Need a Will?

To better understand why you need one, think of what happens if someone dies without a Will. In Ontario, being intestate means the division of assets defaults to rules set out by the government. By a stroke of luck, these may align with your wishes. More likely than not, it could be the exact opposite of your wishes – which is why it’s critical to make a Will. (No one knows how much time we have, no matter how healthy we may be.)

If there’s no Will, chances are there is also no Estate Trustee. The courts will appoint someone, usually a close relative. If that person accepts, they become known as the “Estate Trustee Without a Will” – which complicates everything.

The Estate Trustee Without a Will then applies for probate. This already slow process can get bogged down even more as the courts question the application and determine who the beneficiaries will be.

Asset Distribution Becomes Automatic

Without a Will, the distribution of your assets follows an automatic protocol. The surviving legally married spouse gets the preferential share. Any remaining funds are divided between the surviving spouse and the deceased’s children according to a statutory formula.

If there is no spouse or children, that portion of the estate goes to the parents. If they are predeceased, the estate goes to the siblings. If there are none, then it goes to any nieces or nephews.

Finding the right beneficiaries can take time. With the backlog in the courts, you can expect considerable delays to divide the estate. If disputes arise, it will take even longer.

There are no provisions for friends or charities without a Will, and even common law spouses must file a claim as a dependent against the estate. In the unlikely scenario that there is no next of kin, the government gets it all. Unless you’re happy with the idea of the courts deciding who gets what, you need a Will. If you’ve been putting it off, the time to act is now.

What is estate planning, and why is it so important? Find out in the posts below:

What Happens After Probate Is Granted in Ontario?

The deceased’s estate is in limbo while courts complete the probate process. During this time, the Estate Trustee will manage the assets to the best of their ability, but nothing can be distributed to the beneficiaries until then.

In addition, the house cannot yet be sold. Technically speaking, it can be listed. However, the buyer cannot take possession until the Certificate of Appointment of Estate Trustee is in hand. Listing too soon can cause unnecessary stress for both the seller and the buyer as they prepare for what might be a long wait. And if a house sits on the market for too long, buyers often lose interest altogether.

The Estate Trustee can prepare by performing any renovations and repairs and bringing the house up-to-date to appeal to potential buyers. But before the listing becomes official, it is generally better to wait until probate is fully complete.

At this point, you can follow standard practices in selling a home, even if you need to speed up the process. It can be a heavy burden, especially as you deal with your own grief and a busy schedule. However, having an experienced real estate team you can rely on will ease your burden and set you up for a streamlined transition.

Dealing with an estate sale or have questions about how the process works? Our Peterborough real estate agents are committed to meeting you wherever you are. Reach out to team@jeffandkatie.ca or call 705-243-9797 to start the conversation today.