Prince Edward Island

In Prince Edward Island the executor applies to the Estates Section of the Supreme Court in
Charlottetown for letters probate, or letters of administration where there is no will or the
named executor will not act. The grant is what proves the executor's authority to banks, the land
registry and investment firms.

There is a deadline, and it is short

PEI is unusual in putting a clock on the executor. Where both the executor and the deceased were
resident in PEI, the executor is expected to apply within 30 days of being notified that they
are executor; an executor outside the province has around three months. Confirm the current
requirement with the Estates Section before relying on it — but do not assume you have the year that
other provinces effectively allow.

The governing statute

The Probate Act does most of the work in PEI. Unusually, it contains the rules on the validity of
wills as well as the machinery of the grant and the administration.

What gets filed

• The original will, with proof of due execution.
• Proof of death.
• An inventory of the estate's assets and date-of-death values.
• The application forms, and notice to those entitled.

Fees

Probate fees are charged on the value of the estate and set by regulation. Take the current
figures from the court rather than from an older guide.

Before distributing

Property held jointly with right of survivorship and registered plans or insurance with a named
living beneficiary generally pass outside the estate. Wait for the Canada Revenue Agency clearance
certificate before distributing anything else.

This is the topic where Prince Edward Island differs most from the rest of Atlantic Canada. A PEI
will must be in writing and signed by the will-maker in the presence of two witnesses who are
together at the same time, and who then sign it themselves.

PEI does not accept holograph wills

A will written out entirely by hand and left unwitnessed is not valid in PEI, outside narrow
exceptions for members of the armed forces on active service and mariners at sea. Nova Scotia, New
Brunswick and Newfoundland all accept holograph wills; PEI does not. If you have moved here from
another province with a handwritten will in a drawer, that will is the problem you did not know you
had.

The witness who inherits

A gift to a witness, or to a witness's spouse, fails while the will itself survives. Both witnesses
must be present at the same time — this is a real requirement, not a formality, and signing them
separately can invalidate the will.

Age and capacity

The general rule is 18 or older, with narrow exceptions. Capacity is judged at the moment of
signing.

Practical points

• Name an alternate executor, and pick someone who is on the Island or can act quickly. The
  30-day application expectation is not much time for someone flying in.
• Review after a marriage, separation, divorce, birth, or a move.
• Say where the original is kept. A copy will not obtain a grant.
• Seasonal and inherited land is common here, and PEI restricts how much land non-residents and
  corporations may hold. If land is going to someone off-Island, raise it with the drafter.

With no will, PEI's intestacy rules decide who inherits.

Yes. An executor in Prince Edward Island may be paid for administering the estate.

The standard

Where the will does not fix the amount, the executor is entitled to fair and reasonable
compensation, with the Trustee Act setting the outer limit and the court deciding what is
actually appropriate. The convention practitioners work from is a percentage of the capital of the
estate together with a percentage of the income collected during the administration — often quoted
as up to five per cent of each — with the total then tested against the real circumstances: the size
of the estate, the time spent, the responsibility assumed, the skill required, the complexity and
the result achieved.

How it gets approved

Either all the beneficiaries consent in writing, or the Estates Section approves it when the
executor passes accounts. Agree it in writing first. On an Island where the beneficiaries are
frequently neighbours as well as relatives, an executor who quietly pays themselves creates a
problem that outlasts the estate.

Where consent cannot be given

If a beneficiary is a minor or cannot manage their affairs, consent is unavailable and the executor
should expect to pass accounts formally.

If the will fixes a figure

The will governs, provided the executor accepts the appointment on those terms. A legacy to the
executor may be intended in place of a fee — read the wording carefully.

Tax

Compensation is taxable income to the executor; an inheritance is not. Where the executor is also
a beneficiary, taking a larger share instead of a fee is often better after tax.

A PEI executor is reimbursed out of the estate for the reasonable out-of-pocket costs of
administering it. That is separate from, and on top of, compensation for the executor's time.

Normally claimable

• Funeral, burial or cremation, and a reception in proportion to the estate.
• Probate fees, court filing fees and certified death certificates.
• Legal fees for the application, and accounting fees for the final T1 and any T3 trust return.
• Land registry searches, transfers and registrations.
• Appraisals of real property, farmland, seasonal property, vehicles, jewellery and collections.
• Carrying costs on estate property until it sells: insurance, property tax, utilities, security,
  maintenance, lawn care and snow clearing.
• Cleaning, clearing, storing, moving and shipping the contents of a residence.
• Travel on estate business at a reasonable rate, including the bridge toll or ferry fare and
  mileage off-Island where estate business requires it.
• Postage, couriers, bank charges and bond premiums where a bond is required.

Normally not claimable

• The executor's lost wages, meals near home, or personal costs — compensation covers those.
• Costs run up for one beneficiary's convenience rather than for the estate.
• Improvements to a property beyond what is needed to sell it as it stands.
• Anything the executor cannot document.

The rule that decides it

Open an estate bank account as soon as the grant issues and run every payment through it, and keep
a dated log of time and mileage from the first week. Given how short the PEI application window is,
start the log before the grant rather than after it — the early expenses are the ones people forget
to record.

Most PEI estates are administered by a family member, and for most that is the right answer. A
trust company or a lawyer acting as executor is worth the cost in particular situations.

Consider a professional when

• The named executor lives off-Island. This is the common PEI case. Between the short application
  window, the need to attend at Charlottetown, and the possibility of a bond being required of a
  non-resident executor, an off-Island appointee can struggle from the first week.
• The estate holds a farm, a fishing enterprise, a seasonal rental or an operating business that
  has to keep running.
• Land is passing to someone who is not a resident of PEI, where the province's limits on land
  holdings by non-residents and corporations may need to be worked through.
• There is conflict among the beneficiaries, or a challenge to the will looks likely.
• A beneficiary is a minor or an adult who cannot manage money, so a trust runs for years and the
  Public Trustee becomes involved.

What it costs

Trust companies charge a negotiated percentage, often with a minimum fee that makes a small estate
uneconomic. On an Island of modest estates that minimum matters more than the percentage — ask for
the schedule in writing.

Middle options

• Appoint a family member and let them retain a local lawyer and an accountant at the estate's
  expense. Most PEI estates run this way.
• Appoint an off-Island family member jointly with a local professional, so someone can attend in
  Charlottetown.
• Name a professional as the alternate.

An executor who does not want the job can renounce, but only before intermeddling in the estate.