Estate Documents

Steps to Liquidating an Estate

Declaration of Transmission

Declaration of transmission is a notary document that validates the transfer of a property in the name of the estate or the inheritors. Declaration of transmission for real estate properties are registered at the Quebec Immovable Registry.

Declaration of Heredity

Declaration of Heredity is a notary document required when the deceased dies without a will. It identifies the inheritors and the proportion of their inheritance by law.

Nomination of Liquidator

Nomination of Liquidation is a document required when the deceased dies without a will designating his liquidator. By law, all those called to inherit are liquidators of the estate (including minors). Liquidators can come together and nominate a liquidator by majority. Nomination of liquidator is registered at the Personal Rights Registry (RDPRM).

When a deceased dies with a will, a Notice of Designation of Liquidator is published at the Personal Rights Registry (RDPRM).

Inventory

Inventory is mandatory by law. The purpose of inventory is to determine the value of the estate by calculating the value of property and subtracting debt and taxes to be paid. The inventory will guide the inheritors in either accepting or renouncing to the estate. A notice of closing of the inventory is published in a local newspaper and at the Personal Rights Registry (RDPRM).

Renunciation to the charge of liquidator

A liquidator called to liquidate the estate of the deceased can renounce to their responsibility as liquidator by signing a deed of renunciation to the charge of liquidator in front of a notary. This renunciation is published is registered at the Personal Rights Registry (RDPRM).

Renunciation to the estate

When an estate is insolvent, it is in the best interest of the inheritors to renounce to their rights in the estate. It is pivotal that the inheritors do not touch or acquire any property or money available in the estate or they shall become responsible of the debts. Renunciation to the estate must be signed before a notary by law and is published is registered at the Personal Rights Registry (RDPRM).

Tax Discharge documents

Before distributing the estate to the legatees, the liquidator must request a certificate of discharge from Revenu Canada and Revenu Quebec proving that all taxes owed to the government have been paid. Once the discharge documents are delivered, the liquidator may proceed to the distribution of the estate. Discharge documents can take up 3 to 5 months to be delivered.

Statement of Account

The statement of account is a report prepared by the liquidator stating the final numbers in the liquidation of the estate. The statement outlines the assets and paid debts of the debts, as well as the distribution of the property to the legatees.

Frequent Questions

Delays to renounce to an estate are synchronized with the delays for estate inventory.

Successors have a total of six months to prepare the inventory of the estate and then an additional 60 days to accept or renounce to the estate according to the results of the inventory.

Therefore, a successor can renounce to an estate by notarial act within 6 months + 60 days. The renunciation is registered at the Person rights registry (RDPRM).

If a successor does not renounce to an estate in this period, he is deemed to have accepted the estate.

Inventory is a list of the deceased assets and liabilities. A notice of inventory is published so that creditors can consult the inventory.

When it is evident that the assets of the estates outweigh the debts, the successor’s can discharge the liquidator from the obligation of performing the inventory. However, there is a catch ! In the event that unknown creditors claim payment from the estate, be it during the liquidation of the estate or in the years after, they have the right to seize a successor’s personal assets in order to pay off the debts of the deceased. This seizure of personal assets can be greater than the inheritance itself.

In the event that the assets of an estate are insufficient to pay off the debts of the deceased, the estate can be considered insolvent or bankrupt.

At this point, it is extremely important not to touch any assets, money, or property belonging to the estate or the deceased. Also, it is important not to take any action or sign any documents on behalf of the estate or the deceased. (i.e. transferring money from the bank account of the deceased, transferring ownership of a car, etc.)

Acting on behalf of the estate or acquiring property owned by the estate can be deemed to be an acceptance of the estate. If you accept an estate that is insolvent, you become personally responsible of the debts of the estate.

Once an estate is accepted, you cannot renounce.

If you know that you are dealing with an insolvent estate, it is important that you refuse the estate by deed of renunciation in front of a notary.