Can a Beneficiary Live in the Estate Home Before It Is Sold in Ontario

When someone dies, a child, sibling or partner is often already living in the home. They may have nowhere else to go, or may be caring for the house. Other beneficiaries then ask how long this can last and whether the person living there owes anything.

The answers depend on the will, who owns the home, and how the estate is being run. This article sets out the general picture in Ontario and the questions worth asking.

Who decides who stays?

How the home was owned can matter, so it is worth confirming with a lawyer whether it forms part of the estate in your situation. Estate trustees carry out the wishes in the will, wind up the deceased's affairs, pay taxes, bills and other debts, and then distribute the estate according to the will. How long someone stays is worth settling with the trustee and the other beneficiaries, and a lawyer can confirm how this applies to you. How the home is handled generally comes back to what the will says and how the estate is being wound up, so the interests of the other beneficiaries matter too.

If the will gives the home to the person living there, the picture is different from a will that leaves the home to several people or tells the trustee to sell. If you are not sure which situation you are in, ask to see the will or ask a lawyer to read it.

How long can an estate stay unsold?

Estates are still presumed to be wrapped up within one year of death, often called the executor's year. When an estate is not simple, the court accepts that expecting administration to finish within that year may be unreasonable. So a few months of someone staying put while the estate is sorted out is common, but an open-ended arrangement can become a source of conflict.

If the deceased was married and left a will, the surviving spouse has six months to elect between taking under the will and the equalization entitlement. No distribution may be made from the estate within six months of death unless the surviving spouse consents in writing or the court authorizes it. A surviving spouse living in the home may therefore be in a different position from other family members.

What does the person living there owe?

The law does not give one simple rule that fits every case, and the answers often come from the will and from agreement among the beneficiaries. These are the usual questions.

• Should the occupant pay for utilities, property taxes, insurance or repairs while living there?
• Should they pay something for the use of the home, since the other beneficiaries are waiting for their shares?
• Is the occupant looking after the property in a way that should be recognized?
• Does anyone need to approve renovations, or the moving in of other people?

If these points are not agreed, a dispute can follow. Whether any payment is owed depends on the facts and is worth confirming with a lawyer. A short written agreement signed by the trustee and the beneficiaries can avoid most arguments.

How others can press for a sale

Beneficiaries who want the home sold usually start by writing to the trustee. A person who has a financial interest in the estate may also move for an order requiring the trustee to pass accounts, which opens the estate's dealings to review. On a passing of accounts, objections must be served at least 35 days before the hearing, and the court decides only the issues raised in filed notices of objection.

Where the home is co-owned, the Partition Act allows a joint tenant or tenant in common to be compelled to make partition or sale. The co-owner who resists carries the onus, and a sale is refused only for malicious, vexatious or oppressive conduct. Where land passed by will or on intestacy, no partition proceeding may be taken until one year after the death. Removing or evicting someone is a separate question that depends on the facts, so get legal advice before any step like changing locks.

What to do next

• Find out who the estate trustee is and whether a will exists.
• Ask who owns the home and whether it was held jointly. How the home was owned can affect how it is handled, so it is worth confirming with a lawyer.
• Keep the home insured and secure, and keep receipts for any payments.
• Put any staying arrangement, including a date to leave and who pays what, in writing.
• Confirm the tax steps before any assets are distributed: a legal representative who distributes assets before getting a CRA clearance certificate (Form TX19) is personally liable for unpaid amounts, up to the value of the assets distributed.
• Speak to a lawyer if the arrangement is disputed.

Frequently asked questions