All About Estates

Royalty and World-Wide Assets

This Blog was written by: Alicia Mossington (Godin), Estate and Trust Consultant, Scotia Wealth Management 

The British royal family has been in the news frequently over the past 18 months: from the deaths of Prince Philip and Queen Elizabeth II to the crowning of King Charles and the release of Prince Harry’s tell-all book “Spare.”

Royal families around the world have vast wealth, ranging from investment portfolios, real estate, yachts, artwork, sports teams and arenas…to name a few.

My colleague wrote recently that “when it comes to estate planning, the cases where all property and beneficiaries can be found within a 10km radius are increasingly becoming few and far between.”[1] Although most of us do not have an estate as varied as a royal family, many Canadians do have assets located in different jurisdictions, for example a vacation property or bank account in the United States or abroad.

What happens when you die owning property in a different jurisdiction? The question “which law applies” may arise on the death of a testator where:

  • There are assets physically located outside of Ontario;
  • There is a dependent or beneficiary residing in another jurisdiction;
  • The testator was domiciled outside the country/province/territory where they reside; or
  • The testator is domiciled in Ontario but has citizenship or is a resident for tax purposes in a different jurisdiction.[2]

This article will explore briefly what happens when a testator dies leaving assets situated in different jurisdictions.

In Ontario, the Succession Law Reform Act applies when a person domiciled in Ontario dies, or where the deceased owned assets in Ontario.[3] There is a distinction between immovable assets versus movable assets. The law of succession of immovable assets is generally governed by the law of the place where the property is located (lex situs). Helpfully the SLRA defines movable and immovables:

s.34(a)  an interest in land or immovables includes “a leasehold estate as well as a freehold estate in land, and any other estate or interest in land where the estate or interest is real property or is personal property.”

  1. 34(b) movables includes “a tangible or intangible thing other than land, and include[ing] personal property other than an estate or interest in land.”

Typically the residue or remainder of an estate including cash, personal effects and jewelry are movables.

In addition to asking what law governs a particular asset, it is important to determine what law governs the interpretation of the Will itself. This question is beyond the scope of this blog post.[4] When a person dies without a Will in Ontario, the same principles outlined above for movable vs. immovable property generally apply. There are many articles extoling the importance of preparing a Will. A Will becomes even more important when assets are located in different jurisdictions, because more than one set of intestacy laws could otherwise apply.

Preparing multiple Wills is one of the most common strategies to plan for assets in different jurisdictions. This planning strategy can be useful for many reasons, including:

  • avoiding the question of judicial interpretation and conflict of law;
  • avoiding delays in translating, proving or verifying a foreign Will;
  • minimizing income tax and/or estate administration tax which might arise in multiple jurisdictions; and
  • avoiding delays in securing, administering or selling the property.

When assets are located in different jurisdictions, the executor may have a choice regarding where the original grant of probate (application for a certificate of appointment of estate trustee) is obtained. This choice may impact the administration of the estate. In Ontario, an important factor is the domicile or residence of the deceased at the time of their death.

There are a few decisions in Canada regarding the application of foreign law, and the decision of what jurisdiction will govern the estate administration. For example, in Tyrell v Tyrell[5] the court held that “for the purpose of administering the Will, most significant connecting factor is the residence of the estate trustee.” However, in the Alberta case of Re: Foote Estate[6] the court provided general commentary suggesting that “the domicile of the deceased determines the applicable law for estate administration purpose.” It is important to note that Re: Foote Estate was in the context of a claim for dependents support.

 

Check out Alicia’s related blog A Royal Estate

 

 

[1] Racine, Emily. “Estate Planning and the Great Wide World.” (All About Estates, 26 January 2023).

[2] For a discussion of “domicile” see Giancola, A and Cardiff, L. “The Law Governing Multijurisdictional Estates” (Estate and Trust Summit Day 2, 2022 Oct 20).

[3] Estates Act, RSO 1990, c E21 ss. 7(1)-(2).

[4] For a detailed examination of this question see “The Law Governing Multijurisdictional Estates” by Adam Giancola and Laura Cardiff. (2022, Estates & Trusts Summit Day Two).

[5] 2017 ONSC 4063 – whether the Supreme Court of Ontario had jurisdiction to deal with the administration of a trust where the most of the trust assets were located in Nevis.

[6] 2011 ABCA 1.

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