Executor / Executrix  FAQ

What is an executor?

An executor is the person you name in your will to handle your property after death. The executor must be prepared to carry out a long list of tedious and time-consuming tasks.

LeanLegal is in the process of preparing a free legal tutorial outlining the procedure for probating an estate.  If you would like to be notified when this information is available, please sign up for our free e-mail newsletter LeanLegal Briefs.

What does an executor do?

The executor protects and manages your property until all debts and taxes have been paid and then transfers the remaining property to your heirs.   The law does not require an executor to be a legal or financial expert or to display more than reasonable prudence and judgment, but it does require the highest degree of honesty, impartiality and diligence. This is called fiduciary duty or the duty to act with scrupulous good faith and candor on behalf of someone else.

Depending on the complexity of the estate, an executor or administer would normally:

• decide whether probate is necessary (if the deceased person's property is under a certain amount, formal probate may not be required).

• determine who inherits property from the will if there is one.

• if there is no will, an administrator will follow statutory guidelines which govern the distribution of property under intestate succession.

• decide whether it is legal to transfer some items immediately, even if probate is required for other property.

• file the will and all required legal papers in the local probate court.

• find the deceased person's assets and manage them during the probate process.  This may take up to a year and may involve decisions to sell real estate or securities owned by the deceased person.

• handle other details, such as terminating leases and credit cards and notifying banks and government agencies of the death.

• open an estate bank account to hold money that is owed to the deceased person, e.g. paychecks or stock dividends.

• use estate funds to pay ongoing expenses such as mortgage payments, utility bills and homeowner's insurance premiums.

• pay debts.  As part of this process, the executor must follow certain rules and procedures set out by provincial or state law to officially notify creditors of the probate proceeding.

• pay taxes. A final income tax return must be filed, covering the period from the beginning of the tax year to the date of death.

• supervise the distribution of the deceased's property to the people or organizations named in the will.

How do I choose an executor?

An executor doesn't need special financial or legal knowledge. Common sense, conscientiousness and honesty are the main requirements. An executor who needs help can hire lawyers, accountants or other experts and pay them from the assets of the estate.

The person you choose should be honest, organized and able to keep track of details. If possible, name someone who lives nearby and who is familiar with your financial matters as it will make it easier to do chores like collecting mail and locating important records and papers.

Many people select someone who will inherit a substantial amount of their property. This makes sense because a person with an interest in how your property is distributed is likely to do a conscientious job of managing your affairs after your death. He or she may also know where your records are kept and understand why you want your property left as you have directed.

Make sure the person you choose is willing to do the job. Discuss it with him or her before you make your will.

Does the executor have to serve?

No. An executor can accept or decline this responsibility.  Someone who has already agreed to serve can resign at any time. Many wills name an alternate executor to take over if necessary.  If an alternate is not available, the court will appoint someone to step in.

Does an executor get paid?

An executor is  entitled to payment.  The exact amount is regulated by provincial or state law and is affected by factors such as the value of the deceased's property and what the probate court decides is reasonable under the circumstances.  Close relatives or friends (especially those who are inheriting a substantial amount anyway) don't usually charge the estate for their services.

Does an executor have to hire a lawyer?

Not always. An executor should definitely consider handling the paperwork without a lawyer if he or she is the main beneficiary, the deceased person's property consists of common assets (house, bank accounts, insurance), the will seems straightforward, and good self-help materials are available.   Normally, there are no disputes which require a decision by a judge.   There is a lot of paperwork involved in probating an estate. The executor may never have to appear in court and may be able to do everything by mail.  The job requires persistence and attention to detail, but not necessarily a law degree.

If  the estate has many types of property, significant tax liability or potential disputes among inheritors, an executor may want some help.

If the executor just doesn't want to deal with the probate process, a lawyer can do everything and will be paid out of the estate. In most provinces and state, the law authorizes a lawyer to take a certain percentage of the gross value of the deceased's estate unless the executor makes a written agreement calling for less.

If an executor doesn't want to hire a lawyer, is there any other way to get help?

Other sources of information and assistance might be:

• The court.  Probate court clerks may answer basic questions about court procedure, but will firmly avoid saying anything that could  be construed as "legal advice."
  

• Other professionals. For certain tasks, an executor may be better off hiring an accountant or appraiser than a lawyer. For example, a C.A. may be a big help on some estate tax matters.
  

• Paralegals. In many law offices, lawyers delegate all the probate paperwork to paralegals (non-lawyers who have training or experience in preparing legal documents). In some areas of the country, experienced paralegals help people directly with probate paperwork.  Paralegals don't offer legal advice.  They just prepare documents as the executor instructs them, and file them with the court.

LeanLegal is in the process of preparing a free legal tutorial outlining the necessary steps to probate an estate. If you would like to be notified when this information is available, please sign up for our free e-mail newsletter LeanLegal Briefs.

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