When Both Spouses Die: Accessing Safe Deposit Boxes in Ontario – What You Need to Know

When Both Spouses Die: Accessing Safe Deposit Boxes in Ontario – What You Need to Know

A devastating loss becomes even more complicated when banks lock you out of crucial family documents and assets.

Bottom Line: If your sister and her husband both died and their banks won’t let you access their safe deposit boxes, you’ll need to obtain a Certificate of Appointment of Estate Trustee (probate) from the Ontario Superior Court of Justice. The bank’s suggestion about filing for “unclaimed property” is incorrect advice that applies to U.S. jurisdictions, not Ontario.

The Immediate Problem: Banks Freeze Everything

When banks receive notice of a customer’s death, they immediately freeze access to safe deposit boxes, even when there’s a surviving spouse listed as a co-lessee. When both spouses die within days of each other, this creates a perfect storm where no surviving account holder can provide authorization.

Important misconception: Even if a co-tenant is listed on the safe deposit box agreement, it does not automatically vest ownership of the contents to the survivor, upon the death of one co-lessee. In fact, most safe deposit box leases clearly state in writing that nothing in the lease provides any transfer of ownership during the lifetime of the initial depositor or upon death.

Why the Bank’s “Unclaimed Property” Advice is Wrong

The bank employee who suggested filing for unclaimed property in “the state where you reside” was applying U.S. procedures to a Canadian situation. In the United States, escheatment is the transfer of unclaimed funds or property to a state government after a period of abandonment. However, Ontario operates under an entirely different legal framework.

In Canada, when a Canadian-dollar account, deposit or negotiable instrument held or issued by a federally-regulated bank or trust company has been inactive for 10 years and the owner cannot be contacted, it is considered an “unclaimed balance”. These balances are transferred to the Bank of Canada, not provincial governments. Moreover, this process only applies to dormant accounts, not recent deaths.

The Correct Legal Process in Ontario

Step 1: Apply for Probate

In Ontario, an estate trustee is the only person with the legal authority to manage or distribute an estate. You’ll need to apply to the Ontario Superior Court of Justice for a Certificate of Appointment of Estate Trustee (commonly called probate).

Step 2: Gather Required Documents

To apply to the court for probate, you will need to submit documents to the court that are required by the estate’s court rules, including:

• Certified copy of the death certificate
• Original will (if one exists)
• Inventory of estate assets
• Application forms specific to Ontario probate rules

Step 3: Pay Estate Administration Tax

The Estate Administration Tax is charged on the value of the estate of a deceased person if an estate certificate (probate) is applied for and is issued. This tax must be paid when you submit your application.

Step 4: Present Probate Certificate to Bank

Once the court issues your Certificate of Appointment, the executor can go to the bank to access and remove all contents of the safe-deposit box in order to distribute them in accordance with the terms of the will.

What if the Will is in the Safe Deposit Box?

This creates a classic Catch-22 situation. Although it is not recommended that you keep papers that need to be readily accessible in a safe deposit box, you might find that an elderly loved one has stored legal documents such as a Last Will and Testament and Powers of Attorney in their box.

Solution: Most banks will allow next of kin—such as a spouse, adult child, or parent—to open the box under their supervision after a death. In Ontario, you can petition the court for a limited court order to inventory the box’s contents specifically to locate estate planning documents.

When Probate May Not Be Required

Probate is not always required to administer an estate. The type of assets in the estate usually determines whether an estate should be probated. However, if the deceased owned real property or assets held by a financial institution, the estate normally has to be probated.

For small estates valued at $150,000 or less, you may be able to apply for a Small Estate Certificate instead of full probate, which is a simpler and less expensive process.

Timeline and Costs to Consider

Processing Time: Estate administration in Ontario can take several months. Don’t be concerned if you aren’t given access right away; this process can sometimes take weeks or even months.

Estate Administration Tax: Ontario has significant probate fees:

• Estates under $50,000: No fee
• Estates over $50,000: $15 per $1,000 of estate value

Legal Fees: While not mandatory, most people hire a lawyer for probate applications. Costs typically range from $3,000 to $10,000, depending on estate complexity.

Prevention Tips for Your Own Estate Plan

To prevent your own family from facing this situation:

1. Name Co-Lessees Carefully: Understand that adding someone to your safe deposit box agreement doesn’t automatically transfer ownership of contents upon death.
2. Store Copies Elsewhere: Keep copies of your will and powers of attorney in multiple accessible locations, not just in your safe deposit box. Remember there is only one original will and quite often this is with your lawyer.
3. Document Everything: Maintain a comprehensive list of all your accounts, safe deposit boxes, and their locations for your estate trustee.
4. Consider Joint Ownership: For assets you want to transfer automatically upon death, explore joint ownership with rights of survivorship rather than relying on safe deposit box arrangements.

When to Seek Legal Help

Given the complexity of Ontario probate law and the emotional stress of losing family members, consider consulting with an estate lawyer if:

• The estate includes significant assets or real property
• There are questions about will validity
• Multiple family members are involved in estate administration
• You’re unfamiliar with court procedures

The Bottom Line

Don’t let well-meaning but incorrect advice from bank employees send you down the wrong path. Ontario has specific legal procedures for accessing safe deposit boxes after death, and these procedures center around obtaining proper court authorization through the probate process. While this takes time and money, it’s the only legal way to gain access to your deceased family members’ safe deposit boxes.

The “unclaimed property” suggestion was likely based on U.S. procedures and doesn’t apply to your Ontario situation. Focus your efforts on working with an estate lawyer to navigate Ontario’s probate system and obtain the Certificate of Appointment of Estate Trustee you need.

This article provides general information only and should not be considered legal advice. Estate law can be complex, and each situation is unique. Always consult with a qualified Ontario estate lawyer for advice specific to your circumstances.

Read our blog post on how often there are Will challenges and how often they are successful