After someone passes away, the estate trustee will often apply for a certificate of appointment of estate trustee. While it is not technically mandatory to apply for the certificate of appointment in order to administer the estate, it is often a practical requirement in order to deal with certain types of assets. Applying for the certificate triggers the requirement to pay estate administration tax on the assets of the Estate. Even where it will be practically necessary for the estate trustee to apply for the certificate in order to administer the estate, there are certain ways you can structure your affairs to minimize the estate administration tax that will be payable.
It is generally understood that an estate typically needs to go through probate where the deceased held real property without any other “joint tenants”. Contrary to popular belief, however, there are some exceptions that allow us to deal with real property without first having to go through probate. One of the more curious and relatively unknown exceptions is known as the “first dealings'' exemption.
Joint tenancy and the right of survivorship are concepts that many non-lawyers have at least some exposure to, even if they do not know it by name. For those who own property jointly with another person as joint tenants, whether it is real property (i.e. you house) or personal property (i.e. a joint bank account), the right of survivorship derived from the joint tenancy relationship means that, upon the first person’s death, the entirety of that individual’s interest in the property is transferred to the surviving joint tenant.
In our day and age, elderly people often place their children as joint tenants on their bank accounts and other like assets. In this video, the lawyers discuss the law and address issues like the presumption of a resulting trust and the presumption of advancement.
One of the most important features of a joint tenancy is the right of survivorship. The right of survivorship means that when one of the owners dies, his or her interest in the property passes to the other named owner. To avoid this result and have an ownership interest pass to an estate, the joint tenancy must be severed so that each ownership interest is converted to a tenancy in common.
What happens when two people have a joint bank account and one of them decides to withdraw all the money? That’s one of the questions that the British Columbia Court of Appeal (“BCCA”) addressed in Zeligs v. Janes]. The case is a good case to read for those who want to better understand the law of joint tenancy, tenancy in common and joint bank accounts. For the purposes of this blog our focus is on just one question – when one joint tenant empties out the account, what are the rights of the other joint tenant? Let’s review the case and then discuss the BCCA’s conclusions on this point.
Two people own a bank account in joint tenancy. In the ordinary course, when a joint tenant dies, the surviving joint tenant is entitled to the deceased’s share. Does this situation change because it is an elderly parent and child? Maybe.
As a general rule when people own assets or property on joint account or joint tenancy there is a right of survivorship. So for example, if Frank and Peter have a joint bank account and Frank dies, then Peter is entitled to all that money by right of survivorship. Two recent Supreme Court of Canada decisions have underscored the need to carefully document a person's intentions with respect to jointly held assets.
Law suits often start when siblings discover that one child was made a joint account holder by a parent. When the parent dies the child, as the remaining joint tenant, claims the money by right of survivorship.