- Executors and trustees generally must obtain an order for passing their first accounts within two years of the grant or appointment, unless an exception applies.
- A beneficiary can serve notice requiring accounts to be passed each year.
- A court can also settle an executor's compensation, and the will may set the pay instead.
If you are an executor, you may have heard that you have to "pass your accounts". If you are a beneficiary, you may want to see exactly what happened to the money. A passing of accounts is the formal way a court reviews an executor's record of the estate.
This article explains the general shape of the process in British Columbia: when it is required, what records matter, how compensation fits in and what to do next. The detailed steps, forms and notice rules come from the court rules, so confirm them with a lawyer before you file anything.
This article covers the law of British Columbia.
What a passing of accounts is and when it is required
Passing accounts means putting a full written record of your dealings with the estate before the court and asking for its approval. The government's guide lists preparing accounts showing assets, receipts, disbursements and distribution, and getting the court's approval of them, among an executor's duties.
Under the Trustee Act, executors, administrators and trustees under a will must obtain an order for passing their first accounts within two years of the grant or appointment, unless the exceptions in section 99 apply. Because those exceptions have conditions, check the full section for your situation.
A beneficiary can also trigger the process. If a beneficiary serves notice requiring it, the representative must pass accounts annually, within one month of the anniversary.
What records you need
The court looks at what came in, what went out and what is left. Good records make the review shorter and cheaper for everyone.
- A list of every asset and its value at the date of death
- Records of every receipt, such as sale proceeds, refunds and investment income
- Records of every payment, such as debts, funeral costs, taxes and professional fees
- Bank and investment statements covering the whole period
- Records of each distribution to beneficiaries and signed receipts
- Notes on any compensation you plan to claim and the work behind it
How the process generally runs
In general, the representative prepares the accounts and applies to the court for an order passing them. What is being sought is the court's approval of the accounts. How beneficiaries are notified, and what the court may do if something in the accounts is unclear, depend on the court rules and the facts of the estate, so it is worth confirming with a lawyer.
Registrars can play a role. For example, the court may direct the registrar to settle the amount of compensation. The exact notice periods, forms and who reviews what depend on the Supreme Court Civil Rules and the court's directions, so a lawyer can confirm the current steps.
If a representative does not pass accounts as required, they may be called before the court to explain why.
Compensation, mistakes and protection
An executor or trustee may be allowed a fair and reasonable allowance not exceeding 5% of the gross aggregate value of the estate, and an annual care and management fee may also be allowed. The court may settle the amount of compensation on application, even if the estate is not otherwise before the court.
That is the route a beneficiary can use to test an executor's pay. It does not apply where the will itself sets the allowance.
If an executor may be personally liable for a breach of trust but acted honestly and reasonably, the court may relieve them wholly or partly of that liability. That is one reason to keep careful records and to take advice early.
What to do next
- Note the date of the grant or your appointment and count forward two years
- Gather statements and receipts now rather than at the deadline
- Keep a log of the time and work you do if you expect to claim compensation
- If you are a beneficiary, decide whether to ask for accounts in writing and whether to serve notice
- Speak with a lawyer about the exceptions in section 99 and the current court forms
Frequently asked questions
How soon do I have to pass accounts as an executor?
Generally you must obtain an order for passing your first accounts within two years of the grant or appointment, unless an exception in section 99 of the Trustee Act applies. Check the full section for your situation.
Can a beneficiary force an executor to pass accounts?
A beneficiary can serve notice requiring the representative to pass accounts annually, within one month of the anniversary. A representative who fails to pass accounts as required may be called before the court to explain why.
Can the court decide how much an executor is paid?
Yes. The court may settle the amount of compensation on application, even if the estate is not otherwise before the court. An allowance is generally capped at 5% of the gross aggregate value of the estate, but this does not apply where the will sets the allowance.
What if I made an honest mistake as executor?
If you may be personally liable for a breach of trust but acted honestly and reasonably, the court may relieve you wholly or partly of that liability. Whether that applies depends on the facts, so get legal advice.
Sources
- Trustee Act, RSBC 1996, c. 464, s. 99 — bclaws.gov.bc.ca
- gov.bc.ca, After a Death: Deal with wills and estates — www2.gov.bc.ca
Links go to official government, court and regulator pages. The law changes — confirm you are reading the current version.
This is a wills & estates question
A single will with us is from $894.88, tax included. Third-party fees are extra.