A recent blog by Hull & Hull LLP, found here, highlights the methods that Estate Trustees may use in advertising for creditors. Such options included advertising in local newspapers, the Ontario Gazette, and online services. A recent Judgment by the Ontario Superior Court of Justice considers the appropriateness of advertising for creditors through the online service of NoticeConnect.
The unreported decision by the Honourable Madam Justice Conway dated July 7, 2017 (Court File No.: 05-118/17), declared that the Notice to Creditors published by the Estate Trustee on NoticeConnect, “was an appropriate notice to creditors and the [Estate Trustee] is therefore entitled to the liability protection provided by s. 53(1) of the Trustee Act“.
Therefore, Estate Trustees who properly advertise through NoticeConnect may proceed to distribute assets of an estate with the peace of mind that they will not be held personally liable should a claim against an estate later arise.
Hull & Hull LLP has closely followed the development of NoticeConnect having written numerous blogs about it. It will be interesting to continue to follow NoticeConnect and other technological advances in the estates and trust community, such as Hull e-state Planner, which will certainly assist lawyers in providing quality and efficient service to their clients.
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Debt owing by an individual does not terminate upon death. The estate trustee is therefore obliged to satisfy any outstanding debts owing from the assets of the estate even after an individual has passed away. I recently came across a new service which assists estate trustees in locating any such debts in order to satisfy them.
Generally speaking, an estate trustee is not personally liable for debts owed by the deceased. However, if debts remain and the estate trustee distributes the assets of the estate, they may be personally liable to satisfy them. In order to avoid personal liability, estate trustees advertise for creditors in accordance with section 53 of the Trustees Act, often referred to as Notice to Creditors. According to this section, an estate trustee will not be personally liable for claims by creditors should they place a ‘notice’ specifying a period of time in which claims by creditors must be made. It is important to note that a Notice to Creditors does not prevent creditors from tracing distributable assets to beneficiaries.
The Trustee Act does not specifically provide how such a ‘notice’ must be posted. However, it has become common practice to advertise multiple times in a local newspaper where the deceased domiciled, and wait at least 30 days before taking steps to administer the estate.
A new service, NoticeConnect, publishes these notices to creditors online. According to the creators of the site, “…publishing notices with NoticeConnect is superior to print advertising because the notice will be found by any creditor conducting a basic Google search and because the ad is promoted across multiple internet platforms with larger potential audiences than print newspapers”.
Furthermore, proceeding online “…is an economical option for the many solicitors and estate trustees who are not publishing Notice to Creditors because of prohibitively high costs, exposing themselves to potential liability”.
Full details of the service provided by NoticeConnect can be found on their website.