Some estate trustees in Ontario never need to post a bond. In other circumstances an estate trustee may be required to ‘post a bond’ or ‘secure a court order dispensing with the need for a bond’ before they are appointed.
Bonds are a form of insurance from an insurance company. The purpose of a bond is to protect creditors (like Canada Revenue Agency) and beneficiaries of the estate, if the estate trustee does not act properly. Usually the value of the bond required is twice the value of the estate. Bonds are often very difficult, time-consuming and expensive to secure, and as result many people try to avoid them – either by ensuring that the estate trustee is someone who does not need to post a bond, or, by securing a court order to dispense with a bond.
Court Orders to dispense with a bond are not easy to secure. There are fairly strict requirements that must be complied with. We strongly recommend that you get experienced professional advice when these are required.
The key variables that affect whether or not a bond is required are: whether Ontario is the first location to probate the estate, whether or not there is a will, if there is a will, whether the executor is named in the will, and where the estate trustee resides (ie. whether in Ontario or in the Commonwealth, or not in the Commonwealth).
Ontario first location of probate
With a will & executor named in will
Executor resides in Ontario = no bond required
Executor resident in Canada or Commonwealth = no bond required
Executor NOT resident in Canada or Commonwealth = bond or Order to dispense
With a will, executor NOT named in will
Regardless of residence of executor = bond or Order to dispense
Proposed estate trustee resident in Ontario = bond or Order to dispense
Proposed estate trustee not resident in Ontario = not possible (except in very rare circumstances, which require a Court Order that is difficult to secure).
Estate already probated outside Ontario
First grant of probate is outside Ontario but in Canada or the Commonwealth (called a re-sealing)
With a will, in another Province or the Commonwealth = no bond
Without a will = bond or dispense
First grant of probate is outside the Commonwealth (including the USA) (called an ancillary grant)
With a will, regardless of residence of executor = bond or dispense
Without a will = nominee of estate trustee must be resident in Ontario, and bond or dispense
Click here to obtain our detailed handout on bonding in PDF: