The requirement to post a bond can be found in section 35 of the Estates Act.  An Estate Trustee will be required to obtain an administration bond in instances including where: the deceased passed away without a will; the will does not name the applicant seeking to be appointed; or, the Estate Trustee resides outside of Ontario.

The amount of the bond is to be double the sworn value of the estate.  However, practice has developed (see D’Angelo Estate) such that the size of the bond has been reduced to the sworn value of the estate.

While section 36(1) of the Estates Act sets out specific instances where security is not required, it is section 37(2) which gives the court the general power to reduce the amount of the bond or dispense with it altogether.  In the helpful decision of Henderson (Re), the court indicates that the applicant Estate Trustee who seeks an order dispensing with the requirement to post a bond, should file affidavit evidence in support, containing the following:

1. The identity of all beneficiaries of the estate;
2. The identity of any beneficiary of the estate who is a minor or incapable person;
3. The value of the interest of any minor or incapable beneficiary in the estate;
4. Executed consents from all beneficiaries who are sui juris to the appointment of the applicant as estate trustee and to an order dispensing with an administration bond should be attached as exhibits to the affidavit. If consents cannot be obtained from all the beneficiaries, the applicant must explain how he or she intends to protect the interests of those beneficiaries by way of posting security or otherwise;
5. The last occupation of the deceased;
6. Evidence as to whether all the debts of the deceased have been paid, including any obligations under support agreements or orders;
7. Evidence as to whether the deceased operated a business at the time of death and, if so, whether any debts of that business have been or may be claimed against the estate, and a description of each debt and its amount;
8. If all the debts of the estate have not been paid, evidence of the value of the assets of the estate, the particulars of each debt – amount and name of creditor – and an explanation of what arrangements have been made with those creditors and what security the applicant proposes to put in place in order to protect those creditors.

Applicants should make sure to address each of these factors when applying to dispense with an administration bond.

Noah Weisberg

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• Administration Bonds
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