In Ontario, an executor can generally use estate funds to hire a property manager if keeping the property safe and maintained is complex or time-consuming. However, you must avoid the “unlawful delegation of duties”āmeaning the executor must still make the major decisions, such as when to sell the house.
When you are appointed as an Estate Trustee (executor) in Ontario, managing the deceased’s real estate can quickly feel like a demanding full-time job. Whether you are dealing with a vacant family home in Sudbury, a winterized cottage in Muskoka, or an active multiplex in Toronto with paying tenants, the physical upkeep is entirely your legal responsibility. If the pipes burst because you failed to check on a vacant house, you could be held personally liable.
Because of this high risk, many executors wonder if they can legally hire a professional property management firm and pay them out of the estate’s bank account. Understanding the line between reasonable delegation and abandoning your legal duties is critical. We strongly suggest finding an estate law firm through our directory to review your specific situation before signing any contracts. 🔍
Step-by-Step Process for Hiring a Manager in Ontario
You are allowed to hire professionals to help you, just as you would hire an accountant for taxes or a lawyer for probate. However, the process must be completely transparent to protect you from angry beneficiaries.
Step 1: Review the Last Will and Testament
Your first step is to carefully read the Will. Many modern Wills in Ontario include explicit “administrative powers” that specifically authorize the Estate Trustee to hire agents, property managers, and caretakers at the expense of the estate. If the Will expressly permits it, your legal footing is extremely secure. 📝
Step 2: Assess the Objective Need
If the Will is silent, you must justify the expense under common law. Is hiring a manager objectively reasonable? If you live in Ottawa but the estate house is in Windsor, paying someone to shovel the snow and check the furnace is a highly reasonable expense to protect the asset. If you live next door to a simple, vacant bungalow, a judge might view a management fee as wasteful.
Step 3: Keep Decision-Making Power
You can delegate administrative chores, but you cannot commit an “unlawful delegation of duties.” This means the property manager can fix a leaking roof, collect rent, and mow the lawn, but they cannot decide how much to list the house for, whether to evict a tenant, or when to distribute the sale proceeds. You must retain all fiduciary decision-making power. 👷
Step 4: Transparent Bookkeeping
When you hire the firm, sign the contract strictly in your capacity as the “Estate Trustee.” Keep every invoice and receipt. During the final Passing of Accounts, you will present these expenses to the beneficiaries or the Superior Court of Justice. Clear evidence that the manager protected the home’s value prevents beneficiaries from challenging the expense.
How Much Does it Cost in Ontario?
Property management fees vary depending on whether the home is vacant or actively tenanted. These costs should generally be covered by the estate, not your personal savings. 💰
| Service / Expense | Estimated Cost (CAD) |
|---|---|
| Vacant Home Inspections (for insurance) | $50 to $100 per visit |
| Full Property Management (Tenanted) | 8% to 12% of monthly rent collected |
| Lawn Care & Snow Removal | $150 to $300+ per month |
| Estate Lawyer Consultation | $350 to $650 per hour |
How Long Does the Process Take?
Hiring a property manager can be done immediately once you have a copy of the Will and the death certificate. Retaining their services is usually necessary for the entire duration of the probate and sale process, which in modern Ontario real estate markets typically takes 6 to 12 months before the estate home is finally sold and closed.
Frequently Asked Questions (FAQ)
Do the beneficiaries have to agree before I hire someone?
Strictly speaking, the executor has the legal authority to make this decision without a vote from the beneficiaries. However, it is always a best practice to inform them in advance. If they disagree, they could challenge the expense later during the Passing of Accounts.
Will hiring a manager reduce my executor compensation?
It is possible. In Ontario, an executor is typically entitled to roughly 5% of the estate’s value for their time and effort. If you use estate funds to pay someone else to do a large portion of the physical work, a judge or the beneficiaries may argue your personal compensation should be reduced accordingly.
Can I hire my own company to manage the property?
This is highly risky. Hiring your own business creates a direct conflict of interest. Unless the Will specifically allows you to profit from services rendered to the estate, doing so violates your fiduciary duty and can lead to severe legal penalties.
What happens if the house is vacant?
Most home insurance policies in Ontario require a vacant property to be physically inspected every 48 to 72 hours. If you fail to do this or fail to hire someone to do it, and the pipes freeze and burst, the insurance company will deny the claim, and you will be held personally liable for the damage.
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