You wake up one morning and receive a telephone call that your Uncle Charlie passed away during the night and made you one of the heirs in his Will. You are also advised that he named you as his sole executor. In legal parlance, we sometimes refer to this as estate trustee.
Regretfully, Uncle Charlie never discussed whether or not you even wanted to be his executor in advance of his passing, nor did he explain his estate plan to you, the whereabouts of his assets, or the location of his other heirs. Uncle Charlie also failed to discuss his funeral arrangements with you, or better yet, to prepay his funeral.
The first thing you need to know is that you do not have to accept, and second, the time to resign is before you take any steps as estate trustee. Once you accept the role and begin your duties as estate trustee, you will need a court order allowing you to renounce your role, and you will have to prepare an accounting for any money belonging to the estate that you have administered.
So, if you do not want the position, renounce it now, before you begin. A simple letter of renunciation to the lawyer handling the estate will usually suffice. If however, Charlie was your favourite uncle, and you want to do right by him, especially since he left you $500,000 in his Will, you may decide to accept the appointment.
First, take care of the funeral arrangements
Many psychologists will tell you that a funeral service fulfills an important role in the bereavement process. Sometimes you will find that the deceased will have provided instructions for their funeral in their Will, but often you will find the words, "I leave the disposition of my remains to the absolute discretion of my estate trustee." This is not very helpful, but it is a pretty concise statement of the law granting you the discretion to choose how the deceased's remains will be laid to rest.
Your first step might be to consult other members of the family to find out if Uncle Charlie ever discussed his funeral wishes with any of them, and failing that the more risky inquiry: "What do you think Uncle Charlie would have wanted?" There will be many and varied opinions on this subject. Sometimes you will not even have to wait for an opinion, as many will be offered once the family finds out that Charlie left no instructions.
It would have been perfect if Uncle Charlie had pre-arranged and prepaid his own funeral, but in the absence of that, the law provides some guidance on what is appropriate. The courts have determined that funeral costs and arrangements should be appropriate to the station and place of Uncle Charlie in the society in which he travelled at the time of his demise. In our example, we can assume that Uncle Charlie can afford a two-day wake with a service in the chapel to follow, as well as a limo to carry his grieving family to the internment, and later, the installation of a large gravestone near someone important in the cemetery. I'm sure Charlie would also have liked some of those roll-up sandwiches with the crust cut off and the pickle and cream cheese in the middle at the reception arranged by the funeral home.
The wise estate trustee will search for a standard that is respectful and dignified for the deceased, but also meets the needs of the family in mourning.
Interestingly, even if Uncle Charlie had gone to great pains to spell out every detail for his funeral, the courts have determined that an estate trustee is not bound to follow the instructions of the deceased's Will, because the remains are not property owned by the deceased, which can be governed by their Last Will and Testament. This means that you, as estate trustee, will have the last say, and you may or may not choose to follow Uncle Charlie's instructions.
On the flip side, the courts have also found that an estate trustee has the discretion to follow the deceased's wishes, even where they have not been included in their Will, or where a will does not exist and the person died "intestate." In an Ontario case, the court held that a husband who was administering his wife's estate was entitled to follow his Muslim wife's instructions to be cremated, even though the rest of her family thought her religious requirement for a burial should prevail.
As many people know, there are several less expensive options instead of a traditional funeral. For example, statistics show that cremation of remains now comprises up to 80 per cent of funeral arrangements. The remains can be divided and shared with family members to be buried or spread across lakes, rivers and forests, or even your own backyard. Just keep in mind that the law prohibits that they be "buried" with pet remains.
A real case in point was the woman who arranged and paid for her own cremation and dictated in her Will that her thoroughbred horse be put down shortly after her death, and that the remains of both of them be scattered along the path where they used to ride together. The estate trustee heard and acknowledged these instructions from the woman, but refused to put down the horse. Legally speaking, the horse was property, but mingling the ashes stepped over the boundaries of the law. The lucky horse survived for another 15 years, and led a fulfilling life on a farm outside of Ottawa.
Who should pay for the funeral costs?
When it comes time to pay for the funeral, an estate trustee should not sign the funeral contract personally unless it is obvious that he or she will be able to be reimbursed from the estate. This is because an estate trustee who incurs a funeral obligation for an estate that has no resources is personally liable for the funeral debt. You do not want to become liable for the cost of an overly extravagant funeral for a person of modest means. Often a member of the family will step forward to pay for the funeral, and the primary contractual obligation for the funeral will then rest with them instead of you. Their payment should always be reimbursed by the estate, if the funds are available.
The job of the estate trustee begins with the funeral, which is of primary importance for public policy reasons. Funeral expenses are therefore the first obligation of the estate before other creditors. Making the right decision is fortunately made easier by the competent and ethical advice of the funeral directors in our community.
John Johnson is a partner with the law firm of Nelligan O'Brien Payne (www.nelligan.ca) with offices in Ottawa, Kingston, Vankleek Hill and Alexandria.
[This article was originally published in the May 2015 edition of Fifty-Five Plus Magazine.]