Please note that the information provided herein is not legal advice and is provided for informational and educational purposes only. It may not be up to date. Laws change often and without notice. If you need legal advice with respect to Wills and Estates matters, you should seek professional assistance (e.g. make a post on Dynamic Legal Forms). We have Toronto, Ottawa, Hamilton, Brampton, Mississauga and other Ontario lawyers registered to help you. You can also contact me directly.
This is the sixth of a series of MANY blog posts about Estate Administration in Ontario. Be sure to check them all out! Here, I’ll be talking about bonds and security.
When is a bond needed?
A bond is needed to be addressed in the following situations:
- A certificate of appointment of estate trustee WITHOUT a Will is being applied for;
- A certificate of appointment of estate trustee WITHOUT a Will is being applied for by the person with whom the deceased was living in a conjugal relationship outside marriage;
- A certificate of appointment of estate trustee WITH a Will is being applied for and the estate trustee is not a resident in Canada or in a country that is a member of the Commonwealth;
- The estate trustee WITH a Will is not named in the Will as Estate Trustee (section 35 of the Estates Act);
- In the case of a succeeding estate trustee WITH a Will, and the alternate estate trustee or only surviving estate trustee has died leaving part of the estate un-administered, and the persons entitled to share in the distribution of the remainder of the estate who together have a majority interest in the assets remaining have consented to the applicant’s appointment;
- In the case of a succeeding estate trustee WITHOUT a Will, and the applicant is an individual (not a trust company);
- In the case of a foreign estate trustee nominating a person within Ontario as estate trustee;
- In the case of confirmation by resealing of appointment of estate trustee WITHOUT a Will;
- In the case of ancillary appointment of estate trustee WITH a Will; and
- In the case of estate trustee during litigation (unless bond dispensed with by the judge in the order for directions appointing the estate trustee during litigation);
When is a bond NOT required?
A bond is not required in the following situations:
- The estate trustee WITH a Will is resident in Canada or a country that is a member of the commonwealth;
- A government ministry or agency such as the Public Guardian and Trustee is the estate trustee;
- An estate trustee is a trust company authorized to do business in Ontario;
- The surviving spouse (not a person with whom the deceased was living in a conjugal relationship outside of marriage) of the deceased is appointed estate trustee WITHOUT a Will, the estate has a net value of not more than $75,000 (if deceased died before April 1, 1995) or not more than $200,000 (if the deceased died on or after April 1, 1995) and an affidavit of the applicant is filed with the application setting forth the debts of the estate;
- In the case of a succeeding estate trustee WITHOUT a Will, the estate trustee is a trust company authorized to do business in Ontario; and
- In the case o confirmation by resealing of appointment of estate trustee WITH a Will.
If a Bond is Required…It must be from Insurer or Personal Sureties
If a bond is required, it must be from an insurer licensed under the Insurance Act to write surety and fidelity insurance [Form 74.32] or by 2 personal sureties or one personal surety where the estate value is $100,000 or less [Form 74.33][Rule 74.11 (a)][section 35 of the Estates Act]. Where two personal sureties are required, each must post a bond to cover the total value of the assets (not half each). A personal surety must be an Ontario resident and cannot be a minor. Neither a registrar nor a solicitor is permitted to be a personal surety.
Dispensing with a Bond
A judge may, in special circumstances, reduce or dispense with the amount of a bond. It is open to the estate trustee applying for appointment in any estate to request the reduction or waiver of the bond: section 37(2) of the Estates Act.
The applicant’s affidavit in support of the request for an order that the requirement to post a bond be dispensed with MUST include confirmation that: the debts of the estate have been paid, notification to creditors has been published, and that the consent of the beneficiaries has been filed. The applicant MUST also file a draft order [Rule 74.14].
The following forms contain a consent to dispense with the bond:
- Consent to Applicant’s Appointment as Estate Trustee WITH a Will [Form 74.12];
- Consent to Applicant’s Appointment as Estate Trustee WITHOUT a Will [Form 74.19];
- Consent to Applicant’s Appointment as Succeeding Estate Trustee WITH a Will [Form 74.22];
- Consent to Applicant’s Appointment as Succeeding Estate Trustee WITHOUT a Will [Form 74.25];
Order of the Court to Release a Bond
Where the court requires a bond to be posted, a motion must be made to the court in order to release the bond (section 42 of the Estates Act). There is a fee payable for the motion. The bond cannot be canceled without the court’s approval (section 43 of the Estates Act). The court may release a bond where the estate trustee has passed his or her final accounts or has distributed all of the assets of the estate (section 43 of the Estates Act).
A motion for the release of the bond should be made no earlier than 11 months from the date it was posted. Notice of the motion must be served on all necessary parties. Where an order releasing the bond on a passing of accounts is made, the registrar will place a copy of the order releasing the bond in the estate application file.
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This legal form can be used by a Testator or Testatrix (i.e. a person who is making a Will) to appoint an Estate Trustee to manage their final wishes, transfer the residue of their estate (i.e. their leftover assets after debts have been paid off) to their surviving spouse, and appoint a guardian / custodian for their minor children. This Last Will and Testament also comes with affidavits for witnesses to swear / affirm (great for probate!). Best of all, this Last Will and Testament comes with a FREE VIDEO GUIDE (watch a useful example of how this legal form can be customized), a FREE DL GUIDE (read helpful information about this legal form), and another FREE DL GUIDE that offers valuable insight into how contracts can be challenged) What are you waiting for? Go to Dynamic Legal Forms. And if you DO need a lawyer and need some legal advice, simply make a post and get FREE quotes from Ontario lawyers focusing on the area of law you require!
This information and this sample video guide is NOT legal advice and is provided for informational purposes only. If you need an Ontario lawyer, go to Dynamic Legal Forms and make a post.