How much is a Personal Representative or Executor able to charge for the role they perform?
Like so many issues in the legal field, there is no simple answer to this question. The value and complexity of estates varies tremendously and so does the fee. It cannot be based on simply the total value of the estate. For example, a $1,000,000 estate which consists of one bank account requires far less work than a $500,000 estate that consists of a condominium, a cottage property, and investments in various different stocks in the stock market.
In determining Personal Representative fees, take into account the following factors:
- The time spent.
- The complexity of the estate and the skill of the Personal Representative required to deal with it.
- Urgency attached to various issues dealt with by the Personal Representative.
- The success the Personal Representative achieves in dealing with the estate. For example, if the house sells for a much higher price than expected due to the efforts of the Personal Representative the fee may be higher.
- The division of work between the Personal Representative and the solicitor for the estate
Following this text, there is a chart which acts as a guideline for Personal Representative fees. This chart has been used by Judges in the past so it is a “Court-approved” schedule of fees. It is commonly referred to as the Cullen Tariff as that is the name of the case where it was first used. You can get some idea of how old this tariff is by looking at the emphasis on farm-related items. We have modified the chart slightly to include a more urban emphasis. Remember, the Courts have approved this as a general guide only and various Judges have emphasized the need to consider the individual circumstances of each estate.
In determining suitable Personal Representative fees, start with the chart and then adjust the amount either up or down depending on all the factors listed above.
As a final guideline use the “gut check” measurement. In other words, when you are the Personal Representative you know how much time, effort, and stress was required to get the job done. In some cases, all the assets are easily dealt with and the beneficiaries are likewise so the fee is lower than the chart rate. In other cases, dealing with the assets is stressful and time-consuming and dealing with the beneficiaries is even worse. In that case, a higher fee is appropriate.
If you have any further questions or concerns, please contact us here at Galbraith Law at 780.483.6111 or 1.866.483.6111 or info@galbraith.ab.ca.
| Item | Suggested % |
|---|---|
Capital Records |
|
| Bank Accounts Collected | 1% |
| Collection of Proceeds, Sale of Produce or Livestock | 1% |
| Bond Interest and Dividends Collected | 4% |
| Mortgage and Agreement for Sale Payments | 5% |
| Sale of Real Estate | 3% - 5% |
| Sale and Redemption of Securities | ½ of 1% - 1% |
| Miscellaneous Receipts | 2% |
|
|
| Claims Paid | 2% |
| Estate Tax Paid | 2% |
| Legacies Paid | 1% |
| Payments To or On Behalf of Beneficiaries | ½ of 1% - 2% |
| Sundry Disbursements | 2% |
|
|
| Rentals Collected | 5% |
| Mortgage or Agreement for Sale Payments | 5% |
| Sale of Produce, Livestock or Wheat Board Payments | 1% |
| Sundry Receipts | 2% |
|
|
| Farm Operation Expenses | 2% |
| Business Expenses | 2% |
| Taxes Paid | 2% |
| Miscellaneous Expenditures | 2% |
| Income Beneficiary Payments | 2% |
| Preparation and Filing Income Tax Returns | $50-$60/year |
| Preparation of Accounts and Attending at Passing | - |
| Care and Management of Estate | 3/8 – 1%/year ¼ - 3/8 of 1%/year |