Steps to Settle an Estate

Responsibility: Department of Justice

The Civil Code of Quebec sets out rules for settling an estate. However, the heirs may decide, by mutual agreement, to liquidate the succession without following these rules.

The liquidation of a succession must follow certain rules prescribed by the Civil Code of Québec.

The testator, or the heirs, may designate a liquidator. At the time of the succession, this person must be registered in the Register of Personal and Movable Real Rights (RPMRR) and, if an immovable is involved in the succession, in the Land Register.

This person must, among other things:

• establish an inventory of the deceased's property and register a notice of closure of the inventory in the RDPRM
• identify and contact the successors;
• search for the will and have it probated;
• paying the estate's debts and claims
• make the rendering of accounts;
• deliver the property to the heirs.
• When the estate is solvent, the heirs may by mutual agreement :

liquidate the succession without following the rules prescribed by the Civil Code of Québec
exempt the liquidator from doing so.

They are then bound to pay the debts of the succession out of their own patrimony, beyond the value of the property collected.

INVENTORY OF PROPERTY

The liquidator must :

• draw up an inventory of the deceased's property
• identify the persons or institutions with whom the deceased did business
• identify the obligations to which he was bound.
• To do this, he or she examines the documents that the deceased left at home, at work or in a safety deposit box.

NOTICE OF INVENTORY CLOSING

Once the inventory is complete, the liquidator enters a notice of inventory closing in the RDPRM. This notice identifies the deceased and indicates where the inventory can be viewed.

The place of inspection may include:

• the liquidator's residence;
• the office of the lawyer or notary assisting him or her in the settlement of the succession
• the domicile of the deceased;
• The liquidator notifies the heirs, successors, legatees by particular title and creditors of the publication of the notice. He may send them a copy of the inventory.

The notice must be published in a newspaper (daily or weekly) distributed in the locality of the deceased's last known address.

PAYMENT OF CLAIMS AND DEBTS

Once the inventory has been completed and the notice of inventory closing published, the liquidator makes payment of the estate's debts.

If the estate is solvent :
the liquidator proceeds, in particular, to the payment of debts and particular legacies, as well as claims resulting from the partition of the family patrimony and the liquidation of the matrimonial or civil union regime. He may also pay a compensatory allowance to the surviving spouse.

If the solvency of the estate is undetermined :
the liquidator does not pay any debt or legacy before the expiry of the prescribed period from the date of registration of the notice of closure of the inventory in the RDPRM. This period allows the liquidator to sell certain property with the consent of the heirs or the court. However, he can pay the usual accounts of companies or public services, as well as those whose payment is urgent

If the estate is not solvent:
the value of the property of the estate is insufficient to pay all debts and particular legacies, the liquidator makes a proposal for payment after drawing up a complete statement of the debts and particular legacies. This payment proposal must be approved by the court and sent to the persons concerned.

In practice, the liquidation is completed when either :

• the creditors and legatees by particular title have been paid
• the payment of claims and legacies is otherwise settled;
• the payment of claims and legacies is assumed by heirs or legatees by particular title;
• the assets are exhausted.
• The liquidation is legally terminated only by the discharge of the liquidator.

RENDERING OF ACCOUNT

The liquidator must present a final account in which he or she states the net assets or deficit of the estate. The heirs will receive their inheritance after accepting it.

If the will or the majority of the heirs so require, the liquidator must attach to his account a proposal for the division of the estate. If accepted, the liquidator proceeds to divide the property when it is given to the heirs. If not, the property is divided according to the provisions of the Civil Code of Quebec.

The liquidator must then enter a notice of closure of the account in the RDPRM.

AUTHORIZATION

Before disposing of the property, the liquidator must request authorization from Revenu Québec and the Canada Revenue Agency. Heirs who liquidate the estate without following the prescribed rules must also obtain this authorization.

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