What is probate? Why do we need it?

Estate planning and administration can involve a fair amount of legal jargon. While we believe in using plain language whenever possible, certain terms are inherently technical.

 “Probate” is one such term.

You've likely come across this word, but its meaning and significance might remain unclear. What does “probate” really mean? And why is it needed?

In brief, probate is a legal process where a deceased person's estate is settled and distributed under the guidance of the court. We sometimes describe it as a stamp of approval from the court saying: “ok, the Will and list of assets you provided looks good; you can now go ahead and distribute things in the way that we approved”. The probate process ensures that a Will satisfies all legal criteria, outstanding debts and liabilities are settled, taxes are paid, and assets reach the intended beneficiaries.

Many online sources or TV shows portray probate as an awful (and prohibitively expensive) process that should be avoided at all costs. This perception often stems from jurisdictions with inheritance taxes and percentage-based probate fees. In Alberta, the court fees associated with probate are charged at a flat rate, which varies depending on the value of your estate but is currently capped at $525 CAD.

While there are certainly valid reasons to undertake some planning to have assets to bypass the estate (i.e., "avoid probate"), one must carefully weigh the pros and cons. This assessment needs to factor in the efforts and the potential cost of the planning and preparation required to “avoid probate” in a legally sound (and tax-considered) manner. This is without even getting into the many risks associated with the informal methods used to “avoid probate”, often completed independently without any advice, like transferring accounts into joint names.

So, why don't assets transfer directly without probate? Well, the primary reason is to ensure transparency and authenticity. Probate validates the legitimacy of a Will, if one exists (and, in the absence of a Will, the court will approve a distribution based on established laws). By offering a structured, formal process, potential conflicts among heirs or beneficiaries are minimized, ensuring a smoother transition. At its core, probate serves as a safeguard. It intends to guarantee a person’s legacy is honoured in a fair, legal, and orderly manner. It provides liability protection to the person carrying out the wishes of the deceased (i.e., the executor). While also providing assurances to banks and other institutions (…you wouldn’t want a stranger to be able to walk into a bank, present a fraudulent will, and instantly get access to all your accounts).

Ultimately, probate is really not as scary as some may have you believe – especially in Alberta, where the court fees are not percentage-based. Plus, our system will hopefully continue getting quicker and quicker (fingers crossed emoji), as Alberta is in the process of transitioning to an online system, which is significantly reducing wait times.

Disclaimer: This article is intended for informational purposes only and does not constitute legal advice. It is limited to the laws in Alberta, Canada. Always consult with a qualified lawyer regarding specific legal questions or concerns.