Waiving the deposit requirement under the Estate Administration Tax Act, 1998
Section 3 of the Estate Administration Tax Act, 1998, requires an applicant for a Certificate of Appointment of Estate Trustee to make a deposit in an amount equal to the tax that will become payable under the Act. There is an exemption in subsection 4(2) of the Act, which grants a judge discretion to allow the "estate certificate" (as defined by the Act) where the judge is satisfied:
(a) that the estate certificate is urgently required;
(b) that financial hardship would result from not issuing the estate certificate before the deposit is made; and
(c) that sufficient security for the payment of the tax under this Act has been furnished to the court.
This provision was considered in Re Ethier Estate (2000), 35 E.T.R. (2d) 219. The applicant's request for a Certificate of Appointment of Estate Trustee With a Will based on only partial payment of the appropriate deposit was refused. First, the applicant did not supply any evidence to show what efforts were made to obtain the needed funds. Subsection 4(2) "offers last-resort relief to an applicant", who must establish why he is unable to advance the entire deposit to the estate, which may include taking out a loan. But mere convenience for the applicant is not a relevant consideration.
Second, "urgent" means "pressing or requiring prompt action". This element must be established on the evidence, and any delay in bringing the motion must be explained in the application material. In Re Ethier Estate, the applicant failed to explain a 4 month delay.
Third, "financial hardship" is not merely financial loss or privation, it involves severe financial loss or privation. This must be established on the evidence.
Re Ethier Estate describes a high bar for an exemption from the deposit requirement, or even a partial exemption.
Enjoy the weekend,
Chris Graham
