Estate Settlement Dynamics

At Gordon’s, having worked in the estate services industry for well over 40 years, we’ve seen a variety of complex estate stakeholder dynamics. Respecting the gravity of these complexities and knowing how to recognize and navigate each situation productively, supports long term family harmony and positive outcomes for the estate and its stakeholders. Ignoring these complexities, or hoping things will change can have an equally negative outcome. Below are three typical scenarios, that may sound familiar, along with general guidelines of how to navigate them.

Sometimes a family member has been living in the home of the deceased. Perhaps one son or daughter has been providing care to the deceased and lived in the house. Perhaps they lost steady employment and found a shared refuge with mom or dad. At death another sibling is named Estate Trustee. The resident sibling has no gainful employment and nowhere else to live. The Will says liquidate and distribute the assets between all three offspring. The house cannot be presented well with the current sibling still living there. That person requires proceeds from the estate in order to find other accommodation and they can’t get proceeds until the estate has been liquidated.

Approach to Handling this Scenario: Maintain dignity and kindness

This scenario has challenges on many levels both practical and emotional. Family members often want to preserve a good relationship with siblings and keep less healthy relationships from becoming even more strained. It’s important to allow the sibling who has to move out to do so with dignity. After all they have acted as caregiver to the parent for potentially years, which has been difficult and exhausting. If possible, helping them make interim arrangements to move as soon as possible so that the work of preparing the house for sale can begin, knowing that they will ultimately be able to reimburse whoever helped them is a good starting point.

Overall, the Estate Trustee needs the advice of a service provider partner that appreciates the magnitude of the problem across its many dimensions.

2) Scenario: The value expert

At times, we see a family member that feels everything has enormous value - when typically much of it does not. Sometimes that perception is fueled by need, other times by emotion. They have plans for their share of estate proceeds and hoping and wishing clouds their judgment. Other times, it may be a result of the deceased’s inflated view of value. If you’ve heard certain things are valuable your entire life eventually, even without supporting information, a person may believe it to be so, and in a handful of cases, it may be true.

Approach to Handling this Scenario: Keeping your eye on the real estate proceeds

The reality is that most moderately full 3,200 square foot properties contain a total of anywhere from $3,000 - $10,000 worth of contents. In the grand scheme of things, this is a minor monetary contribution as compared to the proceeds from the sale of the home, which can often take place more productively once the contents are managed.

Engaging experts that understand the value of things and the best ways to handle them often makes this value discussion easier. The current day reality is, due to smaller home sizes (hence reduced demand) and an increase in volume of items that are no longer needed (hence increased supply), it is getting more difficult to hand off items to friends or family or even donate them. Donation partners are getting choosier as to what they’ll take. In addition, in many cases you have to pay to move the items. Even if consignment is your chosen option, that will allow you to deal with a few of the nicest things, but what about everything else?

A solution for managing the items you can’t keep that gets you the most money for the least hassle on your timeline is often the best approach. Solutions that involve you having to pay for logistics like moving and/or storage or be on someone else's timeline make less economic sense.

3) Scenario: The problem solver

One circumstance we see fairly often is a family who has a couple of decision makers, co-Estate Trustees, siblings perhaps. One says, I’ll solve the big issue - the real estate sale! He calls a friend from college, now in the real estate business who lives where the estate home is located and engages that service. Done. Now, he says to his sister, “I’ve done the big thing, how about you look after the rest?” Now, what this help has actually accomplished is to apply pressure to the rest of the contents management work that needs to be completed. In addition, it removes a significant piece of economic leverage the estate may have been able to take advantage of in seeking an integrated real estate and transition services provider, who offer the contents management services bundled with the real estate preparation and sale services.

Approach to Handling this Scenario: Educate the problem solver

Explain the realities of the effort that goes into listing and selling a house versus managing the contents and preparing the house for sale. Due to MLS, website promotion and the strong real estate market in Ontario, listing and selling a property is relatively straightforward as compared to dealing with the contents. In addition, the fee for the real estate sale is generous given the effort expended. However on the contents management end of things, on average a moderately full 3,200 square foot home can take anywhere from 70-100 professional labour hours to clear and prepare for sale. This is manual labour that often has a heavy emotional component when tackled by close friends and family and can take multiples of the professional labour average hours to actually complete the required tasks.

Having an experienced third party partner who can bring an outsider’s perspective to the table and who knows how to navigate these projects well, can be invaluable in terms of efficiency and piece of mind.

Summary

Settling an estate is never easy, even under the best of circumstances. It is an emotionally charged time compounded by the legal and fiduciary responsibilities required of the Estate Trustee. Throw multiple beneficiaries, co-Estate Trustees, interested family members and friends into the mix and it can be stressful. There is no harm in seeking professional assistance to support the Estate Trustee through the process, provide expert advice, help navigate the dynamics and take-away some of the heavy lifting. In fact, many banks offer this service, which can be valuable in complex or multi-country scenarios. At the end of the day, the job of an Estate Trustee is to responsibly manage the wrapping up of the deceased’s affairs, not to do all the work themselves.

If you’d like to learn more about how Gordon’s can help an Estate Trustee manage the real and personal property related aspects of their responsibilities, visit our website here, download our free ebook here, or contact us for a free no obligation consultation.