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Meridian 3.5% 5 year GIC
June 3, 2018
10:00 am
Loonie
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It's great to think the banks would be sensible enough to pay the funeral home out of the deceased's account, but I don't know if it always works that way.
I was asked by the executor (a lawyer) to pay for my father's funeral out of my own money on the understanding it would be reimbursed after probate rec'd. Although I felt uncomfortable about it, I did as I was asked, and it was reimbursed.
I have never had much respect for this particular lawyer's professional competence, on several grounds. I would not have paid if I'd thought he could get the bank to do it directly.

June 3, 2018
7:17 pm
Norman1
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I don't know if it was always like that either. The current bankruptcy legislation came into effect around 1985.

Perhaps you were easier to deal with than your father's bank. Bank would have wanted a bill from the funeral home and to sent the money directly to the funeral home.

There is little risk for the financial institution in paying the deceased's funeral expenses. Perhaps, the bank branch staff didn't know that and it would be a hassle to "educate" the staff.

At worst, the estate would be petitioned into bankruptcy. According to 136 (1) of the federal Bankruptcy and Insolvency Act, the funeral expenses need to be paid in full first, even before the bankruptcy trustee's fees:

Priority of claims

136 (1) Subject to the rights of secured creditors, the proceeds realized from the property of a bankrupt shall be applied in priority of payment as follows:

(a) in the case of a deceased bankrupt, the reasonable funeral and testamentary expenses incurred by the legal representative or, in the Province of Quebec, the successors or heirs of the deceased bankrupt;

(b) the costs of administration, in the following order,

(i) the expenses and fees of any person acting under a direction made under paragraph 14.03(1)(a),

(ii) the expenses and fees of the trustee, and

(iii) legal costs;

(c) the levy …

June 4, 2018
9:59 pm
Loonie
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My dad died well after 1985.
The lawyer asked me to do this before we even went to the funeral home. I doubt very much that he had even talked to the bank, as he's too lazy. He was at pains to tell me he couldn't afford to do it himself since he might be the executor for a number of estates and it would be unaffordable. As the only surviving child, I was an obvious target. If I'd known better, I would have said I didn't have access to that much money on short notice, and that he should ask the bank. This was before I realized what an a-hole he was, so I was being cooperative.

June 5, 2018
7:23 pm
Norman1
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I'd be suspicious that it was a way for the lawyer to charge more trustee fees.

Customary estate trustee fee in Ontario is around 2½% on each receipt or disbursement.

2½% to receive your money. 2½% to pay your money to the funeral home. 2½% to pay you back. 7½% in total! sf-surprised

Maybe no 2½% fee if he took the bill to the bank and the bank sent the money directly to the funeral home.

June 5, 2018
7:43 pm
Loonie
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I don't think it has anything to do with trustee fees per se.
Lawyers, in Ontario, acting as executors, are permitted to charge their regular hourly professional fees for their executor work. There was more than enough padding done there! sf-surprised

i think I could have made a very good case for his fees not being justified but I decided not to pursue it as it was more than I could take on at that time. I did, however, refuse to sign off at the end, so that he would have at least had to appear before a judge to pass the accounts, which I know he would have hated to have done.

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