When a person dies, all their possessions become part of their estate. The estate then needs to be “liquidated”, in accordance with specific procedures.

It is advisable to enlist the help of a professional to carry out these steps, in order to speed up the process and simplify your task. Here are the various steps involved in liquidating an estate.

We are also available to answer your questions by phone at 418 387-2922 . 561 or by e-mail. 

1. Obtaining proof of death

In order to proceed with the succession, the death must be proven by 2 documents: the death certificate and the death record.

As liquidator, you will usually need these 2 documents. These are the only legally recognized documents, issued by the Directeur de l’État civil du Québec. Your notary can request and obtain them for you, to simplify your task.

2. Searching for the last will

As part of the process of executing a will, the liquidator or their notary must conduct a search for the last will and testament made by the deceased. This is an essential step, as it identifies the heirs to the deceased’s estate.

This search is carried out using the two official registers in Quebec: that of the Chambre des notaires and that of the Barreau du Québec.

In addition as liquidator, it is your responsibility to go through the deceased’s papers to check whether there is a will made by hand (holograph will) or in the presence of witnesses. If this is the case, you will be required to use the most recent will to liquidate the estate. You should also check whether there is a marriage or civil union contract that may contain a “last living” gift clause.

If no valid will or gift can be found, the provisions of the Civil Code of Quebec will apply to determine who may inherit from the deceased.

3. Validating the will

If the will has been drawn up by hand, before witnesses or with the help of a lawyer, this means that it is not notarized. In such a case, a further step is required: you must have the will validated by a notary. The purpose of this procedure, established by law, is to ensure that the will: 

• Is the last one (that there is no other notarized will);
• It complies with legal requirements and laws;
• It is valid.

4. Register a notice of appointment of liquidator

When accepting the role of liquidator of an estate, you must make public your identity as liquidator, to avoid any possible confusion about the identity of the executor. In addition, this notice serves to make your identity as liquidator known to the estate’s heirs, creditors and debtors. It is therefore mandatory to register a notice of designation with the RDPRM (Registre des Droits Réels et Personnels Mobiliers). If there is a property in the estate (a house, condo, commercial building or other), you will also need to register a notice with the Land Registry.

Your notary is familiar with this type of procedure and can take care of it for you.

5. Identify and contact heirs

Your role as liquidator also requires you to contact all “successors”, i.e. all those who may potentially inherit and who have not yet accepted the estate. This will ensure that they are aware of the opening of the estate.

If you prefer not to go through the process of finding heirs, simply provide your notary with a list so that he can take care of it.

6. Close bank accounts and open one in the name of the estate

When someone dies, banking institutions freeze the deceased’s accounts, which can cause problems and difficulties in managing current accounts such as the telephone bills and other recurring charges that the person paid on a monthly basis. In order to liquidate the estate, it is therefore advisable to close all existing accounts and open a new one in the name of the estate.

This new account will be used, among other things, to:

• Transfer money from the deceased;
• Deposit money received since the deceased’s passing;
• Pay current bills and/or debts owed by the deceased.

To open a bank account in the name of the estate, you’ll need certain documents that your notary can prepare for you:

• Death certificate issued by the Directeur de l’état civil du Québec;
• A will search in the registers of the Chambre des notaires and the Barreau du Québec;
• A certified copy of the notarial will, or a holograph or witnessed will that has been duly probated.

7. Identify the deceased’s assets and debts, produce an inventory and publish certain notices

Since the assets and debts must be taken into account by the estate, the liquidator is required to make an inventory of all the deceased’s assets worth 100$ or more (house, car, RRSP, RRIF, LIRA, pension fund, etc.), as well as his debts (mortgage, loans, etc.). If applicable, you must also obtain the financial statements of the deceased’s business, the deceased’s partnership agreement and any other relevant documents.

The identification of debts and assets is one of the most important steps in the settlement of an estate, since it not only determines whether the estate is solvable or not, but also protects the liquidator from liability for the deceased’s potential debts. In fact, should the estate be insolvable, or should an unknown debt arise during the process, the liquidator is personally liable for repayment of said debts.

Once the inventory has been completed, you must sign the inventory register before your notary to make it official. This is not a task to be taken lightly, since the declared value of the inventory will be used by the tax authorities to tax the estate. Obviously, determining the amounts of assets and debts can be complex. Property valuation methods, for example, can cause a lot of headaches, so it’s best to rely on a certified appraiser to carry out this responsibility.

A notice of inventory closure must then be registered with the RDPRM (Registre des Droits Personnels et Réels Mobilier) and another notice published in a media outlet covering the deceased’s locality. By taking this step, you identify the deceased and indicate the place where the inventory of the estate’s assets can be consulted by interested parties (heirs, successors, legatees by particular title and creditors). This will save you from having to deal with any creditors who might turn up and claim their due after all the assets have been divided. Here again, your notary’s experience will be invaluable.

8. Filing tax returns and obtaining tax certificates

In the event of death, taxes apply to both the deceased and his or her estate. Therefore, as liquidator, you must file the deceased’s provincial and federal income tax returns for the current year, as well as for previous years if these have not yet been filed. These must be accompanied by all the necessary documents, as well as will searches carried out in both the Barreau and Chambre des notaires registers.

Of course, if there are any amounts to be paid, you’ll need to pay them before any distribution to the heirs, and you’ll need to obtain tax certificates proving that the deceased no longer owes any money.

Once these steps have been completed, all that remains is to file the estate’s declarations for the sums received and paid following the death, and make sure you obtain the certificates authorizing you to distribute the assets and money to the heirs. At the federal level, this certificate is called a Certificate of Discharge, while at the provincial level, it’s called a Certificate Authorizing Distribution of Assets.

9. Pay the deceased’s debts

At this point, three situations are possible, requiring different actions:

• There are enough assets and money in the estate to cover all debts;
• There is not enough money to pay all debts, but there are enough assets;
• There is not enough money or assets to cover all debts.

In the first case, i.e. where there are sufficient assets and money to cover the debts, you can use these to pay off everything. For example: mortgages, taxes, current bills, funeral expenses, legacies, etc.

In the second case, if there isn’t enough money in the estate to pay all the debts, but there are sufficient assets, you can sell the assets to pay the debts. However, you will need to prove that you have the necessary authorizations to do so.

Finally, if the estate is insolvable, i.e. there are not enough assets or money to settle all the debts, you will need to make a proposal for payment and obtain a judgment homologating this proposal before settling the debts.

Whatever your situation, it’s always best to consult a notary, as you are financially responsible for the estate and for any failure to comply with the procedure laid down by law. This means that, in the event of error or default, you could be forced to pay sums out of your own pocket.

10. Present the liquidation report and divide the assets

Once the work has been completed, the liquidator must present the “final account” to the heirs. This is an account of the liquidation, informing them of what remains in the estate once bequests and debts have been paid. Your task as liquidator can only be completed once the heirs have all accepted this “final account”.

For this reason, the liquidator may attach to this document a proposal for the distribution of the estate to the heirs, which they may accept or refuse.

Unfortunately, this can often be a laborious process, as heirs may not agree on the division of assets such as furniture or jewelry. A notary can make this process easier for you, by mediating between the heirs to help you deal with the stress and imponderables of this type of situation.

If the proposal is accepted, the liquidator will then be released from your responsibility, but if it is refused, other legal steps will await him or her. It is therefore in your best interest to involve an impartial person, such as your notary, to better manage everyone’s expectations and help you reach an agreement.

11. Register a notice confirming the end of the liquidation of the estate

Once all the assets have been distributed, you’ll need to publish a notice of closure of the liquidator’s account in the RDPRM. This step is intended to relieve you of your duties as liquidator. In addition, a release must be prepared and signed by all the heirs to legally discharge you from the administration of the estate.

Need to settle an estate?

Contact us now to discuss your situation, and we’ll be happy to listen to you and present you with the best alternatives for settling your estate quickly and hassle-free. Call us today at 418 652.1700.

Winding up an estate is a complex process that requires both legal and tax knowledge, not to mention the time involved.

Let a professional support you and manage for you all the complexities involved in being the executor of your will. Contact us for a no-obligation discussion with one of our notaries. We’ll be happy to answer any questions you may have. Call 418 387-2922 . 561 or e-mail us.

Need more information? Discover below all the advantages of choosing a notary for your estate.

Why choose a notary?

Most people involve a notary in settling an estate

When a death occurs, a complex and tedious process begins: the management of the funeral and the estate. Then there’s the day-to-day business of taking care of the deceased, not to mention all the paperwork involved in cancelling driver’s licenses, health insurance cards, passports, credit cards, notifying insurance companies, employers and government departments if the deceased was receiving benefits, and so on.

So it’s easy to understand why most people choose to surround themselves with a professional for some or all of the estate management. But beyond the support the notary provides, and the legal knowledge he or she brings to the table to simplify your task, what are the concrete advantages of enlisting the help of a notary to manage an estate? Find out below.

The advantages of entrusting the management of an estate to a notary

Dealing with a notary is preferable, and often essential, to settle the legal and administrative issues related to the deceased’s estate.

In fact, in many cases, obtaining or preparing certain documents requires, by law, the involvement of a notary. In addition to all the legal obligations and financial responsibilities you’ll have to face if you miss something or make a mistake, here are the notary’s tasks and the main reasons why it’s preferable to call on a notary when managing an estate: 

• Executing the will to make sure everything is done by the book and avoid potential legal problems: If the deceased left a will, a notary can help you authenticate it and register its legal provisions. The notary will ensure that the will is valid and carried out in accordance with the deceased’s wishes, and that the assets are distributed to the beneficiaries named in the will. In the absence of a will, the notary can advise you on the applicable inheritance laws.

• Opening the estate to avoid potential conflicts with family members: The notary plays an essential role in opening the estate. He draws up a deed of notoriety to identify the heirs and their respective rights.

• Handling legal formalities to ensure that everything has been done in accordance with inheritance and tax laws: The notary helps with the legal formalities associated with the death, such as obtaining a death certificate, declaring the estate and dealing with the various administrative bodies involved.

• Management of the deceased’s assets to relieve you of the administrator’s task and the legal responsibilities this entails: The notary can be appointed as administrator of the estate, responsible for managing the deceased’s assets until they are distributed to the heirs. In this way, he or she ensures that the assets are protected and managed appropriately.

• Liquidation of estate assets: The notary can help you liquidate or transfer assets to the legal heirs.

• Estate management to simplify the task: When someone dies, their property, assets and debts must be managed and distributed in accordance with their wishes or the laws in force. A notary can help you navigate this complex process, ensuring that all legal procedures are followed.

• • Settling debts and financial obligations so you don’t have to pay out of pocket: The notary can help you identify and settle the deceased’s debts. This may include repaying loans, settling current or medical bills, paying outstanding taxes, etc. This may involve selling real estate, closing bank accounts, transferring title to property, etc. The notary can also advise you on how to minimize the tax consequences of the succession.
• Protecting your rights and the rights of heirs: Using a notary can help protect the rights of heirs and avoid potential disputes. The notary acts as a neutral, independent third party, ensuring that all heirs are treated fairly and, above all, in accordance with the law.

Beyond the administrative paperwork, the liquidation of an estate is first and foremost a legal process. That’s why it makes sense to surround yourself with a legal professional who knows all the implications.

What’s more, any mistakes you make are your personal responsibility. So it’s essential that every step of this complex process is carried out without omission or oversight, or you could end up having to pay substantial sums of money out of your own pocket.

With the hustle and bustle of everyday life, it’s a good idea to enlist the help of an experienced professional who can relieve you of the burden of this compulsory process, as well as all the legalities involved. Contact us today to discuss your situation. This initial discussion is without obligation or commitment. Call 418 387-2922 . 561 or e-mail.

Frequently asked questions

Who pays for funeral expenses?

Funeral expenses are generally paid by the estate. If the estate is solvable, funeral expenses are paid out of the deceased’s assets. However, if the estate is insolvable, the person in charge of the funeral is personally responsible for the funeral expenses.

Under certain conditions, the Régie des Rentes du Québec (RRQ) may offer a death benefit upon presentation of the funeral bill. Please note, however, that this benefit is taxable.

If there is no will or testamentary clause, who are the heirs?

In the absence of a will or testamentary clause, the Civil Code of Québec determines who is entitled to inherit. The law provides for the division of the estate by prioritizing people according to their degree of kinship with the deceased. Thus, only those directly related to the deceased, whether by blood affiliation, adoption, marriage or civil union, can become successors.

Once the successors have been determined, they must have their status and rank in the succession recognized by means of a declaration of inheritance. This declaration of inheritance must be drawn up by a notary.

Can a person claim an amount even if he or she is not included in the will?

Yes, a person can claim amounts from the estate, even if the will makes no provision for them. For example, the deceased’s spouse may be entitled to a compensatory allowance to compensate for his or her contribution of goods or services to the other’s estate. Similarly, a child may be entitled to support payments.

As liquidator, could you be required to pay out of your own pocket if you make a mistake?

Yes, if the liquidator distributes the assets without all the required certificates and documents, or if he or she has not followed all the steps in the liquidation of the estate, including the preparation of an inventory of the deceased’s assets, he or she could be required to pay out of his or her own pocket any amounts owing (for example, an amount owing to Revenu Québec for unpaid taxes).

Am I required to accept the estate or can I refuse it?

With certain exceptions, no one is forced to accept an estate. However, once an estate has been accepted, it is no longer possible to change your mind and renounce it. If you choose to renounce it, you must do so by means of a notarial deed. If you accept the succession, the law stipulates that the heirs will be liable for the deceased’s debts up to the value of the property they inherit. It is also important to know that, as an heir, you may be held personally liable for the estate’s debts beyond the value of the property you receive if the liquidator has not carried out an inventory of the deceased’s assets and debts.