Do You Need a Bond to Be an Administrator in British Columbia?

If someone dies without a will, a family member usually applies to the court to be the administrator. Many people have heard that the court can make you buy a bond, and wonder whether that is a standard cost they must plan for.

In British Columbia the starting point is that no security is needed. There are two situations where it can be required, and the court has some flexibility about what it accepts. This article explains both.

This article covers the law of British Columbia.

The general rule: no security

Under WESA s. 128(1), no security for administering an estate has to be provided by an applicant. That means you do not have to arrange a bond as a routine part of applying.

You may also see the word bond used informally. The Act itself uses the word security, not bond. If someone tells you a bond is required, it is worth asking which of the exceptions applies.

Security is only one part of acting as administrator. A personal representative of an intestate estate is conclusively deemed to be the personal representative from the date of death. That is one reason it helps to understand early what the court may ask of you.

The two situations where security can be required

A minor's share is also dealt with separately. Where no trust exists, a minor's share is paid by the personal representative to the Public Guardian and Trustee in trust for the minor.

Interested people also have a chance to speak up early. The P1 notice to intended recipients must state that they may seek an order requiring security from the administrator, except where the applicant is the Public Guardian and Trustee. This means beneficiaries are told about the option before you apply.

Notice to minors and to people who cannot manage their own affairs follows its own path. Minors are given notice through a parent, a financial guardian or known addresses, and also the Public Guardian and Trustee. Mentally incompetent persons are notified through their committee or the Public Guardian and Trustee. Knowing early whether any beneficiary is a minor or incapable helps you see whether security might come up.

What the court can do instead of a full bond

If security is required, the court may accept any form or amount of security. It may also restrict the administrator's powers without prior court or Public Guardian and Trustee approval. So a requirement does not always mean a purchased bond for the full value of the estate.

Which approach a court would choose depends on the facts, such as the size of the estate, who the beneficiaries are, and what concerns were raised. A lawyer can tell you how a request is likely to be viewed.

What security costs in practice

How much security costs depends on your situation, so it is worth confirming with a lawyer. The cost is a market price set by the insurer or guarantor, and it depends on the amount the court sets and on the provider's assessment of you. If a court orders security, ask for written quotes from more than one provider and ask what documents or personal guarantees they require.

Whether the estate may reimburse the cost is something to confirm with a lawyer before you pay, since it depends on the facts and the court's order.

What to do next

Priority matters too. On an intestacy, the first priority to be granted administration is the spouse, or a person the spouse nominates, and a child ranks next with the consent of a majority of the children. In special circumstances the court may appoint any person it considers appropriate.

• Confirm whether any beneficiary is a minor or an incapable person, and whether a nominee exists.
• Deliver the P1 notice, and wait at least 21 days before applying.
• Prepare the Form P2 submission and a wills notice search for any B.C. Supreme Court registry.
• If an interested person asks for security, consider speaking with a lawyer before you respond.
• If security is ordered, compare quotes and ask whether a different form or restricted powers could meet the order.

If no one is willing or able to act, the Public Guardian and Trustee may administer, though it may refuse if the cost would exceed the value of the assets.

Frequently asked questions