The recently enacted Smarter and Stronger Justice Act (the Act) streamlines the process to obtain a certificate of appointment (also known as “probate”) for estates with assets of $150,000 or less in Ontario.
As of April 1, 2021, the Estates Act was amended to define a “small estate” as one not exceeding a total value of $150,000 (O. Reg. 110/21: Small Estates). Additional regulations (specifically, O. Reg. 111/21: Rules of Civil Procedure) came into force to amend the Rules of Civil Procedure create a new process for small estates to obtain a new type of certificate of appointment (a “Small Estate Certificate”) following a relatively simple application process. This new process is more streamlined as compared to the more-involved, standard application for a “Certificate of Appointment of Estate Trustee”. A Small Estate Certificate has the equivalent legal effect to Certificate of Appointment of Estate Trustee, except that the authority is limited to receiving and managing the estate assets specifically listed on that application only.
Applicable Rules of Civil Procedure
This new procedure to obtain a Small Estates Certificate is set out in the new Rule 74.1 of the Rules of Civil Procedure. For Certificates of Appointment of Estate Trustee for estates of value greater than $150,000, the procedure to obtain a certificate of appointment set out in Rule 74 of the Rules of Civil Procedure will continue to apply.
What are the differences between the existing probate process and the new process applicable to Small Estates?
The key differences between the new process available to small estates and the standard process to obtain a Certificate of Appointment of Estate Trustee are as follows:
- The small estates process begins with notice to persons (including charities and contingent beneficiaries) entitled to share in the distribution of the assets. Following a 30-day notice period, the estate trustee then files a simplified application with the Court and awaits the issuance of a small estates certificate by the Court’s Registrar.
- The authority granted under the small estate certificate is limited to the assets specifically listed on that application. Conversely, the Certificate of Appointment of Estate Trustee that is obtained pursuant to the standard process grants the estate trustee the authority to manage all the estate’s assets (and does not include a specific listing of estate assets).
- Where additional assets are located after the Small Estate Certificate has already been obtained which are not specifically listed in the Small Estate Certificate, the estate trustee may seek an amended small estate certificate.
- Whereas the standard process to obtain a Certificate of Appointment of Estate Trustee has two sets of forms (one for cases where the deceased had a will and one where the deceased did not), the small estates process has a single set of forms to be used whether the deceased had a will or not.
- In the small estates process, there is no need to obtain and/or file certain supporting documents, like a commissioned affidavit of service or signed renunciations from persons with a right to apply for probate.
- In the small estates process, a bond in not required unless: a) a beneficiary of the estate is a minor, or b) a beneficiary of the estate is incapable within the meaning of section 6 of the Substitute Decisions Act, 1992. To obtain a Certificate of Appointment of Estate Trustee under the standard process, a bond is generally required (except in limited circumstances or where the court dispenses with the need for the estate trustee to post a bond).
- The small estates process application form is more straightforward than the application that must be submitted in the standard process.
Even where the estate’s value is low enough to may qualify as a small estate, an estate trustee may still decide to apply for a Certificate of Appointment of Estate Trustee. This may be a particularly useful approach where an estate trustee’s efforts to ascertain assets of the estate are ongoing at the time the probate application is made. Additionally, the introduction of the small estate process does not change the requirements applicable for the payment of the estate administration tax (or the first $50,000 exemption).
A special thank you to Colton Riley, articling student, for his assistance in the preparation of this blog post.