Beneficiaries of an estate often want to know how long they should expect to wait to receive their share of the estate.

Unfortunately, there is no simple answer to this question, as the timeline can vary considerably depending on the specific circumstances of the estate.

The executor’s year: A traditional rule of thumb

As a starting point, there is a traditional rule of thumb known as the “executor’s year.” This guideline suggests that an executor is generally expected to complete the administration and distribution of an estate within appropriately one year from the date of the deceased’s death.

However, the “executor’s year” is not a strict rule. It serves as a rough estimate of how long it should take an executor to deal with an estate, originating from an earlier (and simpler) time.

Modern challenges that may delay estate administration

These days, it is quite common for estates to take longer than a year to be fully administered and distributed. The process of applying for probate alone can often take several months, and getting probate completed may be necessary before the executor can access the deceased’s financial accounts or sell their home. Additionally, applying for a tax clearance certificate from CRA can, by itself, add several months to the administration timeline.

The executor’s fiduciary duty: Avoiding undue delay

An executor should, of course, strive to expeditiously complete the process of administering an estate. Executors bear a fiduciary duty to the beneficiaries and must avoid undue delays.

Ultimately, an executor is expected to complete the estate administration process within a reasonable amount of time. What constitutes a reasonable amount of time will vary greatly and depends on the complexity of the estate.

Flexibility in timing: The impact of broad will language

Another factor to consider is that the will may contain broad language granting the executor significant discretion as to the timing of liquidating the estate’s assets. This language may function to provide the executor with considerable latitude as to the timing for administering the estate, and courts can be loathe to interfere with such discretion granted by the deceased.

Limits to executor discretion: Consequences of delay

That being said, an executor is not given a completely blank cheque when it comes to the amount of time they take.

First, if an executor takes longer than the “executor’s year,” there is a longstanding rule from the common law that, absent a contrary intention in the will, specific monetary gifts in the will begin bearing interest. Under common law, this interest has long been fixed at 5% per year in simple interest. For example, if the will leaves $100 to Person  A and it is not paid within one year of the deceased’s date of death, that $100 will begin bearing $5 per year in interest. This rule applies to gifts of specific monetary amounts but does not extend to gifts of a share in the estate’s residue.

Additionally, if it appears that the executor is not proceeding with reasonable promptness in administering the estate, it may be appropriate for the beneficiaries to seek an interim estate accounting and an explanation of the steps the executor is taking to move the estate to completion.

Legal remedies for beneficiaries: Moving the estate forward

If the beneficiaries cannot obtain a satisfactory response from the executor, they may seek an order from the court compelling an interim estate accounting or otherwise providing directions to advance the administration of the estate. However, the extent to which a court is willing to intervene will depend heavily on the specific circumstances.

In some cases, it may also be possible for a beneficiary to apply to the court to compel an interim distribution. For instance, if the executor is taking an unreasonably long period of time to make distributions without just cause, or if a beneficiary would suffer significant financial harm as a result of their share of the estate being withheld, then a court may order the executor to distribute a portion of the estate to the beneficiaries.

Removing an executor: A high bar, but a potential option

In appropriate circumstances, a beneficiary may successfully petition a court to remove and replace an executor if the executor is causing excessive delay in administering the estate without just cause. However, the threshold for removing an executor is relatively high, as courts are often hesitant to interfere with the deceased’s choice of executor.

No one-size-fits-all answer

In summary, there is no straightforward answer to how long an executor has to distribute funds to beneficiaries. Executors are expected to avoid undue delays and complete the administration of the estate within a reasonable time. However, what constitutes a reasonable timeframe will vary significantly from estate to estate. In appropriate cases, beneficiaries have tools at their disposal to help expedite the estate administration process.

Should you have any questions, please do not hesitate to contact a member of Miller Thomson’s Estates and Trusts Litigation group