Probate is the process by which a “Personal Representative” is formally appointed to have the authority to administer the estate of a deceased. The person appointed Personal Representative assumes the duty of gathering information about all of the assets of the deceased, (such as bank accounts, investments and property) paying the debts of the deceased out of the assets of the estate, and then and distributing the remainder of the assets among the rightful heirs, who are known as beneficiaries .
Even the simplest estates can be time consuming, and a Personal Representatives can require the help of several professionals to successfully administer an estate. These professionals could include lawyers, accountants or appraisers. Being a Personal Representatives comes with a lot of responsibilities which can sometimes bring them stress during an already difficult time. The law appreciates that acting in this capacity is an important and time-consuming responsibility, and so it allows for the reasonable compensation to those assuming these responsibilities. This compensation would be separate from any necessary and reasonable out of pocket expenses realized by a Personal Representative while carrying out their duties.
Personal Representatives can be compensated in two possible ways:
1. The Will: A testator is able to include a clause in their Will that clearly states the amount, or terms upon which the Personal Representative can seek as compensation, often a flat rate or percentage of the residue of the estate.. This clause could also incorporate into the Will a comprehensive Compensation Agreement which would have been negotiated between the testator and the Personal Representative prior to their passing. This agreement would detail the terms of the Personal Representative’s compensation from the estate and is common when a commercial trustee, rather than a friend of family member is appointed.
2. The Probate Act: In Nova Scotia, where the testator has not specifically provided for compensation of the Personal Representative in their Will, the Probate Act provides an avenue by which compensation can be requested. The legislation states that on the settlement of an estate, a Personal Representative may claim a commission of no more than 5% of the value of the estate to compensate them for their work.
Approval is required either from the beneficiaries or the court prior to the Personal Representative accepting any compensation from the Estate under the Probate Act. If the beneficiaries all consent to the compensation being paid, the Personal Representative would not need to apply to court. However, if even one beneficiary is unwilling or unable to approve, then the executor must seek court approval for the compensation claimed.
If you're looking for guidance on administering an estate through the probate process in Nova Scotia our law firm would be happy to help. You can call us at (902) 826-3070 or email us at firstname.lastname@example.org to set up a meeting with one of our lawyers at our Tantallon law firm. You can also schedule a no commitment Issue Review Consult for $100+HST where you have the opportunity to explain your situation to a lawyer and get basic advice before deciding whether or not you'd like to retain us.
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By: Amanda Toulany, J.D. - Articled Clerk
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