On March 26, 2020, in response to the pandemic, the government of British Columbia announced the issuance of an order by the Minister of Public Safety and Solicitor General under the Emergency Program Act suspending mandatory limitation periods and other mandatory time periods for beginning a civil or family action, proceeding, claim, or appeal in BC courts. This was followed by second order on April 8, 2020 which specified that limitation periods set out in the Builders Lien Act and Division 5 [Builders Liens and Other Charges] of Part 5 [Property] of the Strata Property Act were not suspended.
On December 21, 2020 it was announced that this suspension will end on March 25, 2021 (order found here – PDF). This is particularly welcome news for our clients who are executors or administrators of estates (generally referred to as “personal representatives”) as the limitation periods set out in the Wills Estates and Succession Act (“WESA”) can afford some protection to personal representatives and the estates they are charged with administering.
If a grant of probate or administration (a “Grant”) is issued in relation to an estate, WESA prohibits any distribution being made to any beneficiaries until after 210 days have expired from the date the Grant is issued. If there is a will, a distribution may be made before 210 days only if all beneficiaries and those entitled to make an application to the Court to vary the will consent in writing or the Court authorizes it. If there is no will, a distribution may be made before 210 days only if all intestate successors consent, or the Court authorizes it. If a rectification, variation, or other proceeding that may affect the distribution of the estate is started, this period is extended beyond 210 days.
This 210-day delay is tied to the fact that WESA leaves open the possibility of an order rectifying a will, and the possibility of a spouse or child of a deceased person successfully applying to vary that will, for 180 days after the date the Grant was issued. An entitlement to a share of the estate may thus be created, increased, or reduced by court order.
If a new beneficiary arises or a beneficiary’s share of an estate is increased by a court order, and that beneficiary cannot receive their full entitlement from the estate because the assets of the estate have already been distributed before 210 days have passed, the personal representative can be held personally liable for the unsatisfied beneficiary’s loss. Personal representatives who make early distributions thus run both the risk that even if all the known beneficiaries consent to the early distribution at the time, an order might later change the beneficiaries, and the risk that there may be a person having standing to vary the will of whom the personal representative is unaware (i.e. a spouse or child the personal representative did not know about).
This kind of risk for a personal representative is usually limited by WESA provisions that protect a personal representative from liability for a loss to an unsatisfied beneficiary due to a distribution made more than 180 days after the Grant is issued and before notice of a will variation or rectification proceeding that may affect the distribution of the estate is received. This is because, under normal circumstances, an application for a rectification or variation order must be made within 180 days of the issuance of the Grant unless the Court grants leave for an application after this date.
The personal representative must be served with notice of such a claim within 30 days of the 180-day limitation period expiring unless the claimant is granted an extension by the Court. Because of this, it is generally safest for a personal representative to wait 210 days from the issuance of the Grant before making a distribution, even if the known beneficiaries and persons entitled to make an application to vary the will (or intestate successors if there is no will) consent to a distribution before the 210-day period has passed.
Currently though, the 180-day limitation period for bringing a will variation or rectification application has been suspended. As a result, personal representatives for any Grants issued between March 26, 2020 and March 25, 2021 who distribute prior to the end of the 180-day limitation period (which begins on March 25, 2021), continue to run the risk that a court order may vary or rectify the will, altering the beneficiaries of the estate or the shares to which they are entitled. This could leave the estate vulnerable to rectification and variation claims, and the personal representatives personally liable to unsatisfied beneficiaries who are able to successfully bring such claims.
Fortunately, with the announcement of a firm date for the end of the suspension of limitation periods, there is now a horizon in sight for personal representatives wishing to have the assurance that variation and rectification claims are no longer a risk to them or the estates they are charged with administering before they distribute the assets to the beneficiaries.
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