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Estates & Wills & Trusts

Simplified rules for smaller estates could cut probate costs

Ontario should implement special rules for smaller estates to bypass the need for probate, Toronto trusts and estates lawyer Daniel Bernstein tells AdvocateDaily.com.

The CBC recently reported on the bureaucratic nightmare an Ottawa woman was faced with trying to transfer ownership of a car into her name from that of her deceased husband.

The woman’s spouse died without a will, leaving her unable to drive or scrap the vehicle without paying more in legal fees than the old car was worth.   

Bernstein, a founding member with Weltman Bernstein, says the problem could be fixed if the provincial government mimicked legislation in Saskatchewan, Manitoba and the Northwest Territories, which impose a simplified procedure on estates worth less than an amount ranging from $10,000 to $35,000.    

“It’s too bad that there isn’t some special set of administrative rules for estates that are so small,” he says. “After people suffer the loss of a loved one, they don’t want to have to go to a lawyer. It can be an intimidating experience for many people.”   

According to the CBC story, the 2004 car was one of the few assets the couple owned, and the woman was named jointly on their insurance slip. The news outlet reports that the Law Commission of Ontario has a long-standing campaign for probate reform, calling its cost "disproportionately high for small estates.” As a result, it can “outweigh the benefits."

Bernstein says clients have frequently been referred to him with circumstances similar to the woman in the CBC’s story, in order to have probate waived in smaller cases.

Lawyers like Bernstein are asked to write an opinion letter to the Ministry of Transportation declaring the widow or widower the likely beneficiary of a vehicle.

That allows the person to obtain a certificate of appointment of estate trustee without a will and avoid the need for probate.

Bernstein says he is concerned that the ministry has recently tightened its policy around the opinion letters, requiring unequivocal statements in favour of the apparent beneficiary.  

“It used to be that you could give an opinion and couch it as based on the facts provided to you,” he says. “Now, they want no equivocations, which means that there’s no other possible heir. You have to be quite forceful, which makes me a little uncomfortable.”

Still, Bernstein says heirs of recently deceased intestate individuals should be aware that probate isn’t always mandatory.

“Frequently people come in and say the bank told them they had to get probate to transfer $50,000 in the person’s account,” he explains. “But if you talk to a manager rather than a teller, you may be able to get it waived. Sometimes they will insist, but it’s a large amount of paperwork for $50,000.”

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