Glossary

This glossary is provided to students as a reference tool. It lists terms and phrases from the
course content and indicates the chapter section where the definition is found. Students are
cautioned to not rely on this glossary for full definitions for exam purposes.
Many terms are generic and apply to all jurisdictions. Although a number of terms apply to many
or all common-law jurisdictions, there are provincial/territorial differences. The Quebec Civil
Code introduces a number of additional terms and concepts. These jurisdictional differences are
captured in the Generic Terms Worksheet found at the beginning of the course materials.
NOTE: Regular text indicates generic or common-law terms.
Terminology specific to Quebec is presented in italics text.

Abatement Rules: The rules that determine what assets will be used to pay the testator’s debts
and administration expenses when there is no residue remaining or available to cover these
liabilities. [7.8.5]
ACB: See Adjusted Cost Base.
Accrued Income: If the asset produces income, such as interest, rents, or dividends, any income
due to the deceased that has accrued since the date of death must be calculated. The amount of
accrued income is an asset of the estate reported on the inventory. It will be reported as income
on the deceased’s final tax return. Accrued income is not included in the asset’s new adjusted
cost base value. [5.3.5]
Ademption: Refers to situations where a testator makes a gift of specific property to a
beneficiary by will, but for some reason the testator no longer owns the property at the time of
death. The property may have been destroyed (fire or other destruction), the testator may have
sold the property, or the asset may no longer match the description. When the gift does not exist
the gift is said to have adeemed and the beneficiary receives nothing. Only specific legacies or
gifts are subject to ademption. [7.8.6]
Adjusted Cost Base (ACB): The original price paid for an asset plus any costs incurred to
acquire or improve the property. When referring to stocks, partnership interests, mutual funds,
and other investments, the ACB may be further adjusted by distributions that are a return of
capital to the investor and income earned. The ACB is required by the tax return preparer in
order to assist with preparation of the final return(s). The information is usually captured in a
separate summary. “Cost base” and “adjusted cost base” may be used interchangeably in these
materials. [5.3.6, 8.2.1]
Administrator: If there is no will, or an executor dies or is unable or unwilling to act, then the
court will appoint an administrator. The administrator is responsible for administering the estate
in accordance with the applicable legislation, or if there is a will, in accordance with the terms of
the will. Also referred to as Estate Trustee without a Will. See also Personal Representative.
[2.3.2.2] Liquidator in Quebec. [Figure 1.1]
 Glossary

Age of Majority: One of the tests for “legal capacity”. See Figure 3.1 for details by jurisdiction.
Agency: An agency relationship arises when one person, the “principal”, appoints another
person or entity to be the principal’s “agent” to carry out certain transactions, or make certain
decisions, on the principal’s behalf. An agent generally has authority to affect the principal’s
legal relations with others. [2.4.1] Mandate in Quebec.
Agent: To carry out financial transactions for another person in accordance with the governing
document, e.g. agent may carry out transactions on the person’s behalf when the person (donor)
is not available; or manage investments or assist with the listing and marketing of real estate.
Also referred to as an Attorney. [Figure 1.1] Mandatary in Quebec.
Alter Ego Trust: A trust for the sole benefit of the settlor during the settlor’s lifetime. The
settlor must be 65 years or older. The settlor is entitled to receive all of the income during his or
her lifetime. Only the settlor can receive or obtain the use of any income or capital during the
settlor’s lifetime. Transfers to the trust take place on a rollover basis (e.g. the assets are deemed
to be sold to the trust at their Adjusted Cost Base, so gain arises and the Adjusted Cost Base is
retained). There is a deemed disposition of the trust’s assets on the death of the settlor. See also
Trust for Persons. [2.2.5.6, 8.2.1]
Ancillary Grant of Probate: Where the original grant of probate has been issued by a foreign
court and the deceased owned property in the province or territory. This grant is required in order
to administer the assets located in the province or territory. If a deceased dies in Canada and
leaves assets in another jurisdiction, an ancillary grant may also be required in the other
jurisdiction, or other local rules may need to be satisfied to establish the executor’s authority to
deal with those assets. [4.5.7.7]
Anti-lapse Rules: The legislative rules dealing with the situation where a testator leaves a gift to
a child or issue, and in some cases a sibling, and that beneficiary pre-deceases. In these
situations, the descendants of the pre-deceased beneficiary (and sometimes a spouse), or the pre-
deceased beneficiary’s estate, will take a pre-deceased beneficiary’s share of the estate. [7.8.2.1]
Asset and Liability Statement. See Estate Summary.
Asset Inventory. See Estate Summary.
Attorney: The person (agent) appointed to act on a donor’s behalf is called an “attorney”. See
also Agent, General Power of Attorney, Limited or Specific Power of Attorney, and Substitute
Decision-maker. [2.5.2.1] Mandatary in Quebec. [Figure 1.1]
Authentic Will. See Notarial Will.
Automatic Resulting Trust: An automatic resulting trust is one where property or funds are
held by one party and the law requires that the property is held for the original owner. [2.2.5.7]
Balance Sheet: A balance sheet lists assets on one side and liabilities and any owner equity on
the other. The value of the assets equals the value of outstanding liabilities and the owner equity.
Asset values, however, are reported in accordance with accounting rules and may not reflect Fair
Market Value. [10.3.7]
Beneficiary: Those who are entitled to receive assets from an estate, whether specific or more
general and who have accepted the gift. The term “beneficiaries” also includes those entitled to

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the revenues or capital of a trust. There are five types of beneficiaries under Common Law
legislation. For the purpose of this course, the term “beneficiary” is used to refer generally to
heirs, successors, and legatees. See also Heir. [4] See Legatee (also Heir, Successor) in Quebec.
[4.2.6]
Beneficiary Designation: A beneficiary designation specifies one or more beneficiaries of a life
insurance policy or certain registered plans upon the death of the insured or the owner of the
plan. Legislation requires that the designation be in writing and permits designations to be in a
will. Where the designation is in a will, other conditions must be met in order to ensure the plans
are properly identified. [3.7.3]
Bequest: A specific gift (personal effect or asset) to be given to a particular beneficiary as set
out in a will. See also Legacy. [4.3.7.4, 7.1.1]
By Head. See Per Capita.
By Root. See Per Stirpes.
Capital Beneficiary: See Residuary Beneficiary.
Capital Cash Transaction Statements: These statements list all assets received, transferred out,
sold or purchased, along with payments to beneficiaries, and any capital expenses, including
taxes and compensation. These statements effectively combine the investment transaction and
capital transaction statements. [10.3.6.1]
Capital Fees: Trustee fees charged to the capital account of a trust. [9.7.1]
Capital Gain: The amount realized when there is a disposition (sale, gift, or other transfer) of
property in excess of the taxpayer’s Adjusted Cost Base. [8.2.1]
Capital Interest: Generally refers to a beneficiary’s interest in the property that makes up the
trust. Property may include land, a home, investments, private company shares, cash, or other
types of property. As assets are sold and the proceeds are reinvested, the gains realized on the
sale form part of the capital. Losses will reduce the capital. Capital interests are usually paid or
delivered to capital beneficiaries when the trust terminates. [2.2.5.5]
Capital Loss: The amount realized when there is a disposition (sale, gift, or other transfer) of
property for proceeds lower than the taxpayer’s Adjusted Cost Base. [8.2.1]
Capital Transactions: These are all of the receipts and disbursements in the main estate or trust.
Once a trust is settled, or an executor has collected in the assets, most capital transactions that are
not investment purchases and sales will be disbursements. Disbursements include distributions to
beneficiaries and certain trust expenses. [10.3.6]
Care and Management Fees: Trustee fees charged annually. The fee is usually shared between
the capital and revenue accounts. [9.7.1]
Case Law: See Common Law.
CCQ: Civil Code of Quebec. See Civil Law.
Certificate of Ancillary Appointment of Estate Trustee with a Will. The Ontario term for
Ancillary Grant of Probate.

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Certificate of Appointment of Estate Trustee during Litigation. The Ontario term for Grant
of Administration Pendente Lite.
Certificate of Appointment of Estate Trustee with a Will: The Ontario term for Grant of
Probate.
Certificate of Appointment of Estate Trustee with a Will: The Ontario term for Grant of
Administration with Will Annexed.
Certificate of Appointment of Estate Trustee without a Will: The Ontario term for Grant of
Administration.
Certificate of Appointment of Succeeding Estate Trustee with a Will. The Ontario term for
Grant of Administration de Bonis non Administratis with Will Annexed.
Certificate of Appointment of Succeeding Estate Trustee without a Will. The Ontario term
for Grant of Administration de Bonis non Administratis.
Chain of Representation: Where an executor dies and the administration is incomplete, and the
will does not provide for an alternate, if the executor’s executor takes out a grant of probate for
the executor’s estate, a new grant is not required. Instead, there is a transmission of the
executorship. [4.5.7.5]
Charging Provision: A clause in a will or trust authorizing the executor or trustee to charge fees
for his or her service. It may also be used to authorize a professional to charge professional fees
for professional services provided to the estate or trust. [9.2, 9.7.8]
Child: See Issue.
Civil Law: Quebec has a civil law tradition that has its roots in Roman law. It includes
components of the Napoleonic Code from France, and has also incorporated elements of English
common law. The Civil Code of Quebec (CCQ) governs private law matters and sets out the
rules that make up the private law. Additional statutes have been passed to supplement certain
areas of the private law. [1.5, 1.6.2]
Civil Union Spouses: Civil union spouses acquire the rights of a legally married couple.
[7.2.1.1] See also Spouse.
Claims for the Value of Services Provided. See Quantum Meruit Claim.
Class Gift: A “class” of beneficiaries of a trust fund who will share in a distribution. Class gifts
may include children, grandchildren, siblings, nieces and nephews, or any other identifiable
group. [7.5]
Clearance Certificate: A written confirmation from the CRA that all tax liabilities of the
deceased have been paid or that acceptable security for payment has been provided. It protects an
executor or trustee from personal liability. [8.8]
Codicil: A codicil amends an existing will. Codicils are often used to amend, delete, or add
beneficiaries. They are also used to amend a specific power or other provision in the will. In
order to be valid, a codicil must conform to all the requirements of a will. [3.3.3]
Committee: See Guardian, Substitute Decision-maker.

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 Glossary

Committee of Person. See Personal Guardian.

Common Law: A system of law that was developed in England and has been adopted by the
British Commonwealth countries. When a court hears a case it may have to interpret or apply
legal principles to clarify or settle the law for a given set of circumstances. As decisions are
made, they establish legal precedents. Over time a body of law, often called case law, judge-
made law, or jurisprudence has evolved. [1.5]
Common-law Partner/Spouse: Includes a person who co-habits in a conjugal relationship with
the taxpayer either for a continuous period of twelve months or for any period while raising a
child together. It includes same-sex partners who are not legally married. [8.2.1] See De Facto
Spouse/Relationship in Quebec.
Common-law Relationships: Where a formal marriage has not taken place, including same-sex
relationships. Legislation provides criteria for establishing when a common-law relationship will
be recognized for purposes of that statute. Often the rules require two years of co-habitation but
the period can be as short as one year, or as long as three years. Sometimes a shorter period of
one year is used if there is a child from the relationship. Some statutes provide guidance on what
constitutes termination of the relationship. Others do not. [7.2.1] See De Facto
Spouse/Relationship in Quebec.
Condition Precedent: A condition (or event) that must occur before a trust comes into existence
or before a trustee can distribute property in favour of a particular beneficiary. [7.6.3.1, 7.6.3.2]
Condition Subsequent: A condition that stops an existing trust or trust distribution from
continuing. In other words, the trust takes effect, or the trustee can distribute property to a
particular beneficiary, until the condition (or event) occurs. If a trust is subject to a condition
subsequent and that condition occurs, the trust comes to an end. [7.6.3.1, 7.6.3.2]
Condominium Fees: The monthly fee paid by owners of townhouse and apartment-style
condominium units. In some jurisdictions, these are referred to as “strata fees”. [6.1.2.3]
Contingent Interest: Occurs when a beneficiary takes only if a condition or event occurs. For
example, the gift may require the beneficiary reach a certain age or satisfy another condition. Or
it may depend on certain other events occurring, such as the death of a beneficiary who was
vested subject to divestment. See also Vested Indefeasibly and Vested Subject to Divestment.
[7.6.2]
Continuing Power of Attorney. See Enduring Power of Attorney.
Conventional Will: A will is one that meets the formal requirements of the relevant jurisdiction,
including the rules governing who may be a witness. Also referred to as English Form Will.
[3.1.4.1] See Will Before Witnesses in Quebec [3.2.2.8]
Co-Ownership: Refers to shared ownership where each owner has full rights to a specified share
of the asset and those rights pass under the will or succession rule. [5.5.1.1] See also Joint
Tenants with Rights of Survivorship, Tenants in Common. See Undivided Co-Ownership in
Quebec.
Corporate Trustee: A federally or provincially regulated trust company that offers fiduciary
services to the public. For the purposes of this course, the corporate trustee is assumed to be

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licensed to provide services as a personal representative, trustee, substitute decision-maker, or

agency services to assist personal representatives, trustees, and substitute decision-makers. [5.1]
Cost Base: See Adjusted Cost Base and Purchase Cost.
Creditor of Support. See Dependant Relief.
Curator. See Fiduciary, Guardian, Personal Guardian, Property Guardian.
Date-of-Death Value: The value of the asset at the end of the day of the date of death. When
dealing with investments that trade on the open market, the value is the closing price on the date
of death, or if the date of death is not a business day, the closing price on the last business day.
[5.3.7]
Declaration Clause: A statement at the end of the will summarizing who was present and signed
the will. [4.3.10.2]
Deemed Disposition: The ITA requires that the taxpayer (an individual or a trust) report all asset
transfers as if an asset was sold. Examples of non-sale transfers include gifts, a transfer to a trust,
a transfer of an asset to a non-resident, or a deemed sale when a Canadian becomes non-resident.
Deemed dispositions also arise immediately before a taxpayer’s death or the death of the settlor
or spouse in a spousal trust, alter ego trust, or joint spousal or common-law partner trust. [8.2.1]
De Facto Relationship/Spouse: A common-law relationship in Quebec. It is recognized in a
limited number of situations. However, couples may register their relationship as a civil union.
See also Common-law Relationships/Spouse. [7.2.1.1]
Demonstrative Legacy: These are gifts of money that the testator intended to be paid out of a
designated fund. If the designated fund no longer exists or has been diminished to a point where
it cannot satisfy the amount of the gift, then the gift can be paid from other assets in the estate.
[7.1.1.2]
Dependant/Dependent: For purposes of this course, refers to someone who is financially
supported by the deceased (usually a minor child, disabled adult child who cannot earn their own
livelihood, or spouse,). Some provinces define dependants to include other relatives too.
Depending upon the legislation, “dependant” or “dependent” may be used. [3.2.4.1, 6.4]
Dependant Relief: Under provincial legislation, a claim may be made to vary the terms of the
will to obtain a greater share [6.4.2.2, Figure 6.4] Creditor of Support in Quebec.
Devise: A specific gift of land to be given to a particular beneficiary as set out in a will. See also
Legacy. [4.3.7.4, 7.1.1]
Directive: A statement that sets out the health care decisions that a “maker” wants made when
he or she is no longer capable of consenting to or refusing treatment. A directive may include
personal care decisions. See also Personal Directive and Proxy. [2.5.3.1]
Discretionary Trust: A trust where the trustee has discretion, within specified guidelines, to
distribute income and/or capital to one or more beneficiaries. The discretion may be limited to
choosing who is to receive income and/or capital, or it may allow the trustee to decide how much
and/or when to distribute. See also Trust for Persons. [2.2.5.6]
Disposition Value: See Fair Market Value.

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Dispositive Provisions: These will clauses deal with the disposition of the estate. There are a
number of sub-categories: payment of funeral expenses, debts, taxes, and other testamentary
expenses; conversion and retention of assets; specific gifts; general disposition of personal and
household effects; trusts for specific assets or purposes; residue clause; residue clause; hotchpot
clause; and survivorship clause. [4.3.7, 4.3.7.3 (Quebec)] Realizing Assets in Quebec.
Doctrine of Acquiescence: When a beneficiary alleges a breach of trust against the trustee, this
principle requires that in addition to the delay, the beneficiary was aware, or ought to have
known of, his or her rights. See also Doctrine of Laches. [10.3.2]
Doctrine of Incorporation by Reference: This allows a testator to incorporate an unexecuted
document into a will. Examples include memorandums that list how to distribute specific
personal effects, compensation agreements, or the trust provisions of an existing inter vivos trust.
In order to incorporate another document by reference, the other document must be in existence
when the will is executed and the will must specifically refer to it. [3.2.2.5]
Doctrine of Laches: When a beneficiary alleges a breach of trust against the trustee, this
principle allows a court to dismiss a claim because of the long delay. See also Doctrine of
Acquiescence. [10.3.2]
Domestic Partner. See Spouse.
Domicile: One’s permanent home or the place to which at some time in the future one
contemplates returning on a permanent basis. A person can only have one domicile at a time.
There are three types of domicile: domicile of origin (determined at birth by the place of birth),
domicile of choice (the place where an individual, after attaining the age of majority, takes up
residence with the intention of remaining indefinitely); and domicile of dependency (conferred
by operation of law upon those persons who, by reason of legal or mental disability, are unable
to acquire a domicile of choice). [1.7.1.1, 1.7.1.3 (Quebec)]
Donor: The individual (principal) who makes a power of attorney document is often called the
“donor”. [2.5.2.1] See also Maker.
Dual Ownership: A trust divides the legal ownership (title) and beneficial ownership
(enjoyment). The trustee holds the legal title and is the only party able to deal with the assets in
the trust (e.g. sell, transfer, collect income). The beneficiary holds the equitable (or beneficial)
title. Only the beneficiary is entitled to enjoy the benefits of the property. The benefits or
interests may include receiving income such as interest, dividends or rents; having the right to
live in a home; or receiving the capital or assets at some future time. Different beneficiaries may
be entitled to one or more rights to the enjoyment of the property. [2.2.1.2]
Encroachments on Capital: See Capital Interest.
Enduring Power of Attorney (EPOA): An enduring power of attorney is a power of attorney
that states the power of attorney is valid during any period of subsequent mental incapacity of the
donor. It may cover all of the donor’s assets or be limited in some way. Generally, an enduring
power of attorney is effective immediately but the attorney will not assume authority until the
donor is incapable or asks the attorney to start to act on the donor’s behalf. Also referred to as
Continuing Power of Attorney. See also Springing Power of Attorney. [2.5.2.1, 11.2] Protection
Mandate in Quebec.

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English Form Will. See Conventional Will.

EPOA. Enduring Power of Attorney.
Estate: “Estate” refers to the property owned by the donor or incapable adult. [2.5.2.3]
Estate and Trust Record. See Estate Summary.
Estate Liabilities: These are outstanding bills and liabilities at the date of death, including
outstanding income tax liabilities up to and including any taxes that are due on the final date of
death tax returns. These are typically listed on the estate summary and they are paid from the
capital. [6.1.1.3]
Estate Summary: This is a key document in the administration of a will or trust. It lists the
assets and liabilities and is the source of information for preparation of tax returns, it can be the
beginning of the accounting to the residual beneficiaries, and it can be used to monitor the
progress of the administration by checking that all assets are collected and liabilities paid and
that legacies to beneficiaries are delivered or paid. The Adjusted Cost Base should also be
included. Also referred to as Asset and Liability Statement, Asset Inventory, Estate and Trust
Record, Inventory, Inventory of Assets, and Summary of Assets and Liability. [4.5.8.4, 10.3.6]
Inventory in Quebec.
Estate Return. See Trust Income Tax and Information Return.
Estate Trustee. See Executor.
Estate Trustee without a Will. See Administrator.
Executor: A will appoints someone to administer the estate. More than one person can be
appointed. The person appointed is called an “executor” (male) or “executrix” (female). Also
referred to as Estate Trustee. See also Personal Representative. [2.3.2.1] Liquidator in Quebec.
[Figure 1.1]
Executor’s Year: The first year of administration of the estate. Generally an executor cannot
be forced to make any distribution or any payment of income the “executor’s year.” The
executor’s year is also recognized for tax purposes. [4.2.11.1, 4.2.11.2] In Quebec no such rule
exists. [4.2.11.3]
Executrix: See Executor.
Express Trust: An express trust is a trust that is intentionally created, usually in writing.
[2.2.5.1]
Fair Market Value (FMV): When valuing an asset for probate or income tax purposes, the
value is the amount which could be obtained in a sale on an open market. This is often called the
“disposition value.” [5.3.3, 8.2.1]
Fiduciary: One who is responsible for managing property or making decisions for the benefit of
others or on behalf of another person. Fiduciaries include trustees, personal representatives, and
substitute decision-makers. There are many other examples where someone may have fiduciary
duties to others. These include the directors appointed by shareholders of a company to oversee
the management of the company or investment managers entrusted to manage an investor’s
assets in accordance with an investment policy. Also referred to as Attorney, Guardian, Personal

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Representative, Proxy, Substitute Decision-Maker, and Trustee. [1.1] Curator, Liquidator,

Mandatary, Trustee or Tutor in Quebec.
Fixed Interest Trust: A trust that specifies exactly what a beneficiary is entitled to. For
example, the trustee may be directed to pay the net income earned each year or a fixed amount at
regular intervals (e.g. $1,000/month) to a beneficiary. See also Trust for Persons. [2.2.5.6]
FMV: See Fair Market Value.
Fully Discretionary Trust: Generally, this is a trust where the trustee has full discretion as to
when, how much, and to whom income or capital should be distributed. The trust will establish
the class or group of individuals who are the beneficiaries who may receive the funds. See also
Trust for Persons. [2.2.5.6]
General Legacies: These are gifts that do not describe the specific asset or property that should
be used to fund the legacy. General legacies are usually specific monetary amounts, sometimes
referred to as “pecuniary legacies” or “cash legacies”. [7.1.1.3]
General Power of Attorney: A general power of attorney is a power of attorney that covers all
of the donor’s assets. [2.5.2.1]
General Title Legacies: This type of residue clause entitles one or more persons to take the
ownership of an aliquot share of the succession (e.g. 30% of the residue); a dismemberment of
the right of ownership of the entirety or an aliquot share of the succession (e.g. a right of use and
habitation); or the ownership or a dismemberment of the right of ownership of the whole or an
aliquot share of all of a particular type of property. [4.3.7.8]
Gift: Provision in a will. Usually referred to as a testamentary gift. [3.1.2, 7.1.1] Legacy in
Quebec. [3.1.2]
Gift Donatio Mortis Causa: This gift is made during the lifetime of the “donor” in
contemplation of death. It is not necessarily made in the expectation of death. Death must be
anticipated from an existing peril such as illness, event, or high-risk activity, such as military
posting to a war zone. The gift is not valid unless the donor dies as a result of the specific cause
contemplated. [3.7.4.2]
Gift Over: Provision in a will for an alternate beneficiary in case a beneficiary pre-deceases or
does not accept a gift. A gift over allows the testator or settlor to control the distribution. Where
a gift has failed and there is no gift over, the outcome will depend on the facts and the outcome
will be determined by legislation or case law. [7.8]
Graduated Rate Estate (GRE): A new term introduced with the 2015 amendments to the ITA.
An estate that meets the GRE conditions and designates itself as a GRE is entitled to graduated
tax rates and an off-calendar year end. Note that if there are two estates (e.g. two wills dealing
with different assets), only one estate may be a GRE. [8.2.1]
Graduated Tax Rates: Different tax rates are applied to each “band” of taxable income. [8.2.1]
Grant: Refers generically to any grant issued by the court.
Grant of Administration: This is a grant issued when the deceased died intestate. This grant
authorizes the person or corporate trustee appointed, the “administrator”, to administer the estate.
See also Grant of Probate. [4.5.7.2]

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Grant of Administration de Bonis non Administratis: Where a grant of administration has

already been issued and it is necessary to appoint a new administrator, the original grant must be
surrendered and a new application is made for a grant of administration de bonis non
administratis appointing a new administrator to complete the administration. [4.5.7.4]
Grant of Administration de Bonis non Administratis with Will Annexed: If a grant of probate
has been issued and the sole remaining executor dies, the court will appoint another person to
complete the administration of the estate in a grant of administration de bonis non administratis
with will annexed. See also Chain of Representation. [4.5.7.5]
Grant of Administration Pendente Lite: This is a grant issued by the court appointing an
administrator to preserve the assets of the estate when there is a legal action to resolve a dispute
over the validity of the will. The administrator may be an independent third party. [4.5.7.6]
Grant of Administration with Will Annexed: This grant is issued when an executor has died,
is unable to act, has renounced the appointment, or, in rare cases such as with a homemade or
holograph will, the testator neglected to appoint an executor. Another person or corporate trustee
may apply to be the administrator of the estate. [4.5.7.3]
Grant of Probate: The grant of probate (or grant of administration) is issued by a court
certifying that the will that is attached to the grant has been duly proved and registered with the
court. It verifies the executor’s (or administrator’s) authority. See also Chain of Representation.
[2.3.3, 4.5.7.1]
Grantor: See Donor.
Guarantee: A loan made to another person, often a loan from a financial institution to an adult
child or family member, or to a business owned by the deceased. Obligations do not end upon
death. [6.1.2.6] See Suretyship for Quebec.
Guardian: A person appointed by the court to make decisions on behalf of an incapable adult.
The authority of a guardian may be limited to some or all financial and legal matters and may
include, or be limited to, personal and/or health care decisions. For purposes of this course, the
terms “property guardian”, responsible for financial and legal matters, and “personal guardian”
responsible for personal and health care decisions, are used where applicable to avoid confusion.
Also referred to as Guardian Committee Trustee (AB). [2.5.2.2] Curator or Tutor in Quebec
[Figure 1.1]
Guardian of Person. See Property Guardian.
Heir: A universal legatee or a legatee by general title who has accepted the succession Also
successor and legatee. See also Beneficiary. [4, 7.1.3 (Quebec)] See Successor in Quebec.
Henson Trust: See Trust for a Disabled Person.
Holograph Will: A holograph will does not require witnesses. The only formal requirements for
a holograph will are that the entire will must be written in the handwriting of the testator and it
must be signed by the testator. [3.1.4.3]
Homologation: Renders the protection mandate executory (e.g., becomes effective) and enables
the performance of the mandate to ensure the protection of the fundamental rights of the
mandator. [11.2.6.4]

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Hotchpot Clause: Provides for the executor to make an adjustment in the estate distribution that
accounts for property that passed to a beneficiary outside the estate. The objective of a hotchpot
clause is to equalize the distribution among beneficiaries under a will. If a beneficiary received
assets outside of the estate prior to or upon the death of the testator, and that beneficiary is one of
a class of beneficiaries (e.g. the children of the deceased) entitled to share the residue equally, a
hotchpot clause requires the value of the assets received outside of the estate to be taken into
account when calculating and dividing the residue of an estate among all of the residual
beneficiaries. [4.3.7.9, 7.12] Returned (gift to be returned clause) in Quebec.
IC: See Information Circular.
Immovable Property: Refers to real property, anything permanently affixed to real property, or
any interest in real property. Immovable property includes land, buildings, mining rights,
leaseholds, and rights to receive rent or income from real property. [1.7.2.1, 1.7.2.2 (Quebec),
5.4]
Implied Trust: See Resulting Trust.
Income or Revenue Interest: Generally refers to a beneficiary’s entitlement to receive the
income earned in the trust for a period of time, often until a certain age or death. Income (or
revenue) includes interest, dividends, and rents. [2.2.5.5]
Income Statement: The income statement records all income received or earned and deducts
allowable expenses in accordance with the relevant accounting rules. The net income is the
amount that remains for distribution or reinvestment. [10.3.7]
Indemnity from Beneficiary: If granted with the benefit of full disclosure and independent
legal advice, provides the executor or trustee with some protection should liability arise in the
future once there are no assets with which to pay a legitimate claim or defend a claim. Often
included in the release and discharge, indemnities will usually include a statement that it is
binding on the beneficiary’s estate, executors, heirs, and successors. [10.4.2]
Information Circulars (ICs): Are published by Canada Revenue Agency to provide
information on administrative and procedural matters. [8.1.7]
Insolvent: This refers to the inability to pay one’s debts as they fall due. An estate will be
insolvent when all the debts, liabilities, and expenses exceed the realizable value of estate assets.
[6.5.1]
Interim Approvals: Where there is an ongoing trust, trustees may wish to seek periodic
approval to the accounts informally or formally before the courts. [10.4.3]
Intermeddling: The point at which one’s decisions and actions take on the authority of the
personal representative. In these situations, whether or not named as the executor, one may
become liable to the estate for actions taken. If the named executor has crossed this line, it may
no longer be possible to renounce the appointment. If a person who is not named as an executor
has interfered with the administration, his or her acts may be binding on the estate and he or she
may be found to be an “executor de son tort” (an executor “by his own wrong doing”) and liable
for any losses that may arise. [4.4.4.1]

Glossary-11
 Glossary

International Will: International wills are recognized in the jurisdictions around the world that
have adopted the Convention Providing a Uniform Law on the Form of an International Will. A
testator who owns property in jurisdictions outside of Canada who wishes to dispose of the assets
under a single will may do so by using an international will where the convention applies.
[3.1.4.4]
Interpretation Bulletins or “IT Bulletins”: Are published by Canada Revenue Agency (CRA)
and are helpful in explaining, in everyday language, the purpose and application of tax law on
various topics. They represent the CRA’s interpretation of the Income Tax Act and do not have
the force of law. [8.1.7]
Inter Vivos Gift: When a donor (or “giver”) makes a gift to a donee (or “recipient”) while the
donor is living. The donor transfers ownership of the property to the donee. The gift is
irrevocable and the donor loses control of the ownership and use of the property. [3.7.4.1]
Inter Vivos Trust: A trust created during the creator’s lifetime is called an “inter vivos trust”.
The person who creates the trust must transfer or “settle” property on the trust and is called a
settlor. The document that evidences the trust is often called a “trust deed” or “trust settlement”.
The assets in an inter vivos no longer belong to the settlor. Because the assets are no longer part
of the settlor’s assets they do not pass under the settlor’s will and are not subject to the probate
process. Subject to the terms of the trust, the trust may continue after the settlor’s death. If
permitted in the trust document, assets may be transferred to the trust in the future by the settlor,
or others. Sometimes inter vivos trusts are called “living trusts”, a term often used in the United
States. [2.2.5.2]
Intestacy Rules: Intestacy rules apply when a person dies without a will, the will is found to be
invalid and there is no prior will, or the will fails to dispose of some or all of the deceased’s
estate. [7.13.1]
Intestate: If a person dies without a will, the person is said to die “intestate”. When someone
dies intestate, provincial and territorial legislation sets out who may apply to administer the
estate and how to distribute the estate in these circumstances. [2.3.1.2]
Intestate Beneficiary: A person entitled to receive a share of the estate according to the
jurisdiction’s intestacy laws. [7.1.3]
Inventory. See Estate Summary.
Inventory of Assets. See Estate Summary.
Investment Statements: These statements list the assets owned by the trust and will include the
Adjusted Cost Base as well as the Fair Market Value at the beginning and end of the period.
[10.3.6.1]
Investment Transactions: These are the purchases, sales, and other changes to investment
holdings. Each transaction records the number of shares or units, the price paid or received,
commissions paid, and total proceeds. The net gain or loss on each transaction is also recorded.
[10.3.6]
Issue: Refers to all of the testator’s direct descendants. [7.3] Lineal Descendants in Quebec.
Joint Common-Law Partner Trusts: See Joint Spousal or Common-law Partner Trusts.

Glossary-12
 Glossary

Joint Ownership: The terminology used when two or more people may wish to own property
together. Joint ownership is common among spouses and is also used by parents and an adult
child or other relative for a variety of reasons. See also Joint Tenants with Right of Survivorship
and Tenants in Common. [3.7.6]
Joint Spousal or Common-law Partner Trust: A trust for the settlor and his or her spouse or
common-law partner. The settlor must be age 65 or older. The spouse and/or the settlor are
entitled to the income and only the spouse and/or the settlor are entitled to receive or obtain the
use of the income or capital while they are alive. The assets are transferred to the trust on a
rollover basis unless a taxpayer elects otherwise. On the death of the survivor, there is a deemed
disposition. [8.2.1]
Joint Spousal Trusts: For this inter vivos trust, the settlor’s spouse or common-law partner is
also a beneficiary. The spouse or common-law partner does not need to be age 65. The trust can
provide that either or both of the spouses are entitled to receive the income, and either or both are
the only beneficiaries entitled to receive capital while they are living. Upon the death of the
survivor, the trust may be wound up or continue as an inter vivos trust. See also Trust for
Persons. Similar to spousal trusts, this trust meets very specific requirements under the Income
Tax Act. This is an inter vivos trust and is most often used when the settlor has reasons for
ensuring that his or her estate does not pass under a will. One key characteristic of this trust is
that the settlor must be 65 years or older. [2.2.5.6]
Joint Tenants with Right of Survivorship: Unlike a “tenancy in common”, the owners have
equal ownership in the asset(s) and when one owner dies, the survivor(s) become the owner(s).
The asset passes outside of the estate and, where applicable, is not subject to probate fees. Jointly
held assets can include bank accounts, investments, investment accounts, real property, and
many other assets. [3.7.6.2, 5.5.1.2] This legal concept does not exist in Quebec legislation.
Judge-made Law: See Common Law.
Jurisprudence: See Common Law.
Legacy: A specific gift to be given to a particular beneficiary as set out in a will. The term “cash
legacy” is often used when referring to a specified cash amount, “bequest” when referring to a
personal effect or asset, and “devise” when referring to land. Refers to all gifts of personal or real
property under a will that are not gifts of residue. Where required, the nature of the legacy is
addressed more specifically. There are four categories of legacies for this purpose – specific,
demonstrative, general, and residue. Also referred to as Bequest, Demonstrative Legacy, Devise,
General Title Legacy, Specific Legacy. [4.3.7.4, 7.1.1, 7.8.4.1] See Legacy by General Title
(General Legacy), Legacy by Particular Title (Particular Legacy) and Universal Legacy in
Quebec. [3.1.2]
Legacy by General Title: This type of Quebec gift entitles one or more persons to take a
specified share of the succession, a dismemberment of the right of ownership of the whole or a
specified share of the succession, or the ownership or a dismemberment of the right of ownership
of the whole or of an aliquot share of all the immovable or movable property, private property,
community property or acquests, or corporeal or incorporeal property. [7.1.2]
Legacy by Particular Title: This type of Quebec gift is defined as a legacy that is neither a
universal legacy nor a legacy by general title. [7.1.2]

Glossary-13
 Glossary

Legal Capacity: A person must have legal capacity to enter a transaction if the transaction is to
have legal effect. In order to have legal capacity two tests must be met – the person must be of a
certain age and he or she must have the requisite mental capacity. [2.6.1]
Legatee: One who is entitled to receive a legacy under the will. The term does not distinguish
whether the legacy is specific, demonstrative, or general. [7.1.3] See also Heir.
Legatee by Particular Title: A person who has accepted a legacy by particular title (e.g. a
legacy of a specific item or sum of money). A legatee by particular title is not called an heir.
[7.1.3]
Letters Probate. See Grant of Probate.
Life Interest: Refers to a beneficiary’s right to enjoy the use of a property or asset during the
beneficiary’s lifetime. A common example is the right to live in a residence held by the trustees.
A life interest can include the right to receive the income from the assets during the beneficiary’s
lifetime. The term may be used to include an income or revenue interest. On the beneficiary’s
death, the settlor provides instructions on where to distribute the funds, or the trust may continue
for others. See also Trust for Persons. [2.2.5.5, 2.2.5.6]
Life Tenant: A term sometimes used in common law jurisdictions, particularly when the
beneficiary’s interest involves the use of a property such as living in the home. [2.2.1.2]
Usufructary in Quebec.
Limited or Specific Power of Attorney: This power of attorney limits the duration or assets
that the attorney is responsible for or is made for a specific purpose. A limited power of attorney
may be an enduring power of attorney. [2.5.2.1]
Lineal Descendants. See Issue.
Liquidator: See Administrator, Executor, Fiduciary, Personal Representative.
Living Trust: See Inter Vivos Trust.
Living Wills: Often thought of as documents made to provide instructions that are restricted to
end-of-life decisions. They provide directions as to the type of care and life-sustaining medical
treatment that should be administered or withdrawn in the case of a terminal illness where
such treatment would only prolong death and not provide any benefit for the patient. Canada
does not have legislation for making living wills. See also Directive. [2.5.3.3]
Maker: The person who makes a personal directive is the “maker”. Other terms include
“director,” “donor”, and “grantor”. May also be used to describe a testator. [2.5.3.1] Mandator
or Maker of a Mandate in Quebec.
Maker of a Mandate. See Maker.
Mandatary. See Agent, Attorney, Fiduciary, Principal.
Mandatary in Case of Incapacity. See Protection Mandate.
Mandatary to the Property/ to the Person. See Proxy, Substitute Decision-maker.
Mandate. See Agency, Power of Attorney.

Glossary-14
 Glossary

Mandator. See Maker.

Manifestly Solvent: On the face of the will, the assets exceed liabilities. [4.2.11.3]
Marginal Tax Rates: The effective tax rate on the taxpayer’s entire income, taking into account
the lower tax on income in the lower rate bands. [8.2.1]
Mere Power: Gives the trustee discretion to pay income or capital to one or more beneficiaries
or members of a class of beneficiaries. A trustee who holds a mere power is not required to make
a payment to the beneficiary. [10.2.1]
Mirror Wills: These are separate wills made by two individuals that are identical, except that
they make each other the first beneficiary. The wills then provide for identical gifts on the death
of the survivor. Mirror wills are common between married or common-law couples who wish to
leave everything to the surviving spouse with a gift over to children or other issue of the union.
[3.6.1.1]
Movable Property: This refers to any property that is portable. The legal definition of movable
property includes all personal property, such as goods, chattels, and personalty. It also includes
intangible property, such as negotiable instruments and securities. [1.7.2.3, 1.7.2.4 (Quebec), 5.4]
Mutual Wills: This concept addresses situations where two or more individuals have agreed to
dispose of their shared property in a certain way. Mutual wills (or a joint will if in one document)
are sometimes used by spouses in their second marriage who want their estate to take care of the
surviving spouse while that spouse is alive, and then have the assets of the estate distributed
among the children from their first marriage. The mutual agreement between the testators
distinguishes mutual wills from mirror wills. [3.6.1.2]
Notarial Will: A notarial will is authorized under art. 716 of the Civil Code of Quebec (CCQ). It
must be made before a notary, en minute, in the presence of a witness, or in some cases two
witnesses. Also referred to as Authentic Will. [3.1.4.2, 3.2.2.7]
Notary: A legal professional in Quebec who gives legal advice to all parties in a transaction,
drafts legal documents, gives the character of authenticity to documents, and keeps formal
records of transactions that can be relied upon in future. [1.8.2]
Notary Public: A person in a Canadian common law jurisdiction whose primary role is to
administer oaths and affirmations, take affidavits and statutory declarations, and witness and
authenticate documents. With the exception of British Columbia, a notary public does not give
legal advice nor do they have any specific authority to draft documents or transfer or mortgage
real property. A lawyer who is a current member of the law society of a common law jurisdiction
is also permitted to act as a notary public. [1.8.1.1]
NR. Non-Residents of Canada.
Patrimony: The whole of the rights and obligations of a person having economic or pecuniary
value. [2.2.2.1]
Per Capita: A per capita distribution means that a gift or fund is divided equally “by head”
among the individuals within the group identified. The division takes place in equal shares
among all the persons entitled without regard to their degree of relationship. A per capita

Glossary-15
 Glossary

division differs from a per stirpes division in that there is no re-division among the issue of a
pre-deceased beneficiary. See also Per Stirpes. [7.4.2] By Head in Quebec.
Personal Care: A generic term used to distinguish personal decisions (relating to the physical
person) from financial decisions. Personal-care decisions may include both health care (e.g.
consent to including medical treatment and withholding medical treatment), as well as personal
care. Personal-care decisions that are not health-care related generally include decisions about
where one lives, including placement in a health-care facility or long-term care facility, as well
as matters related to nutrition, clothing, personal hygiene, social activities, and social contacts.
[2.5.3.2]
Personal Directive: The document made by a “maker” that includes a directive and/or
appoints a “proxy”. Generally, a proxy must follow any directives that are in the document. Also
referred to as Power of Attorney for Personal Care and Representation Agreement. [2.5.3.1]
Protection Mandate in Quebec.
Personal Guardian: A person appointed by the court to make personal-care and/or health-care
decisions. As with a property guardian, the court must determine that the adult person is
incapable of making these decisions for him- or herself and then appoint a personal guardian.
Corporate trustees are not authorized to accept these kinds of appointments. The authority of the
personal guardian may be a general authority over all decisions, including health care, nutrition,
shelter, clothing, hygiene, or safety. Or the authority may be limited. Also referred to as
Committee of Person and Guardian of Person. [2.5.3.5] Curator or Tutor in Quebec.
Personal Purposes. See Trust for Persons.
Personal Representative: Those responsible for administering the estate of a deceased person
and distributing the estate to the beneficiaries. Includes executors and administrators. Also
referred to as Administrator, Estate Trustee with/without a Will, Executor. [1.1] Liquidator in
Quebec.
Personal Trusts: See Trust for Persons.
Personalty: See Movable Property.
Per Stirpes: A per stirpes division divides a gift or fund among the issue (or descendants) of an
individual by “stocks” or by roots. It is also sometimes described as a division “by
representation.” A per stirpes distribution requires the share of a pre-deceased beneficiary to be
distributed among the beneficiary’s surviving descendants of the next degree. Children are
descendants of the first degree, grandchildren are descendants of the second degree and so on.
[7.4.1] By Root in Quebec.
Power of Attorney: A power of attorney is a written document that authorizes an “attorney” to
manage the financial affairs of the “donor.” A power of attorney permits the attorney to do
anything the donor can do, subject only to the restrictions imposed by the document, legislation,
or the law. At common law a power of attorney is not valid during any subsequent incapacity of
the donor unless specifically stated. See also Enduring Power of Attorney. [2.5.2.1] Mandate in
Quebec.
Presumption of Resulting Trust: The law also sets out certain situations where A transfers
legal title to property to B but the intention of the transfer is not clear. Is it a gift? Is it a trust?

Glossary-16
 Glossary

Subject to certain exceptions, a transfer that is not a gift or a transaction where B has paid A for
the property, the laws presume that B is holding the property for A on a resulting trust and must
return it to A. [2.2.5.7]
Pre-taking: Taking trustee fees prior to obtaining approval from the beneficiaries (where
possible) or the court. [9.5.5]
Principal: This person appoints an agent (another person or entity) to be his or her “agent” to
carry out certain transactions or make certain decisions, on the principal’s behalf. Also referred
to as Donor and Grantor. [2.4.1] Mandatory in Quebec.
Private Purposes Trust: Examples of private trusts include trusts for purposes such as erecting,
maintaining, or preserving a thing or for a specific use, whether for the indirect purpose of a
person or in his or her memory, or for some other private purpose. These trusts are essentially
non-charitable purpose trusts. Such trusts may be established by gratuitous title, or by will.
Private trusts include trusts established by onerous title such as for making profits from
investments, providing for retirement or procuring a benefit for the settlor, others designated by
the settlor, members of a partnership, company or association, or for employees or shareholders.
Private trusts may also be perpetual. Also called a Private Trust. [2.2.4.2]
Probate Fees: A fee charged for reviewing the grant application and issuing the grant. Some
jurisdictions charge a flat fee, but most have a minimum fee and then charge a percentage on the
value of the assets. Also referred to as “probate taxes”. [4.5.8.5]
Probate Taxes. See Probate Fees.
Property Guardian: When an adult is unable to manage his or her financial affairs, provincial
law provides a mechanism for the court to first declare the adult person incapable of managing
his or her affairs and then appoint a person(s) or a corporate trustee to be the guardian to make
financial decisions on the adult’s behalf. Also referred to as Committee of Estate, Guardian for
Property, and Trustee (AB). [2.5.2.2] Curator or Tutor in Quebec.
Protection Mandate: Quebec version of enduring power of attorney. It only takes effect after a
court process called “homologation” where the mandatary (attorney) provides evidence that the
mandatory (donor) is incapable. See also Enduring Power of Attorney. See also Enduring Power
of Attorney. [11.2.6.4]
Proving a Will in Common Form: Non-contentious process for obtaining a grant of probate.
An application for a grant is filed “over-the-counter” at the appropriate court office and does not
require a court appearance before a judge. Court officials review the application and supporting
documents to ensure that all required information is included and that the will has been executed
in accordance with the jurisdiction’s requirements. Once the application is complete, the court
will issue the grant. Although a will proved in common form is sufficient to protect an executor
or third party who relies on a grant of probate in common form, it can be challenged at a later
date. [4.5.4.1]
Proving a Will in Solemn Form: A formal court hearing before a judge is required. It may also
require more onerous notice requirements and witnesses may need to be called to testify. A will
proved in solemn form can only be challenged at a later date in limited circumstances. [4.5.4.2]

Glossary-17
 Glossary

Proxy: A person appointed by a “maker” and is given authority to make personal care or health
care decisions on behalf of the maker when the maker becomes incapable. Alternate names are
“agent,” “attorney for personal care,” “delegate,” “substitute decision-maker,” and
“representative”. [2.5.3.1] Mandatary to the Person in Quebec. [Figure 1.1]
Public Curator. See Public Guardian and Trustee.
Public Guardian: See Public Guardian or Trustee.
Public Guardian and Trustee: In most jurisdictions, there is a public body that reviews all
applications and monitors the guardian after the appointment. The public official for the
jurisdiction. [2.5.4] Public Curator in Quebec.
Public Trustee: See Public Guardian or Trustee.
Purchase Cost: This is usually the original amount paid for an asset. It is referred to as the cost
base or Adjusted Cost Base. “Cost base” and “adjusted cost base” may be used interchangeably
in these materials. See also Adjusted Cost Base. [5.3.6]
Purpose Trusts: See Trust for Purposes.
Qualified Disability Trust (QDT): A testamentary trust for a beneficiary who qualifies for a
disability tax credit under section 118.3 of the ITA. If the trust meets the requirements of the Act,
the trustee and beneficiary may make a joint election each year to be a QDT and pay tax on trust
income at graduated rates. If capital is paid to a non-electing beneficiary (e.g. someone who does
not qualify for a disability tax credit), a recovery tax must be paid for income taxed at the lower
rate that is distributed to the non-electing beneficiary. There can only be one QDT for a disabled
individual. [8.2.1]
Quantum Meruit Claim: A claim for personal services provided to the deceased by a person,
other than the executor, where there is no signed contract or agreement. When the services are
services that one would normally pay for, the law implies a promise to pay the value of those
services. [6.3.4.3] Unjust Enrichment Claims in Quebec.
RDPRM: Register of Personal and Movable Real Rights
Realizing Assets. See Dispositive Provisions.
Release and Discharge: Prior to completing a final distribution, the executor or trustee usually
seeks a release and discharge from the beneficiaries, or from the court. It confirms that all of the
estate or trust information and accountings has been provided and there are no complaints and
provides the fiduciary with some protection from the beneficiary making a claim in the future. A
release usually includes a clause stating that it is binding on the beneficiary’s estate, executors,
heirs, and successors. [10.4.1]
Remedial Legislation: See Substantial Compliance Legislation.
Replacement Value: When valuing assets for insurance purposes, the executor requires the
replacement value, that is, what would it cost to rebuild or replace this asset if is destroyed,
stolen, or lost. [5.3.3]
Residence: Refers to the place where one normally lives, however, one’s residence can be
transient and, as a result, a person can have more than one residence. For tax purposes, this is the

Glossary-18
 Glossary

jurisdiction where an individual taxpayer is determined to have closer residential ties. Residence
is a question of fact. Guidance is provided on how to determine a Canadian taxpayer’s residence
when the taxpayer spends significant amounts of time in another jurisdiction. For the purposes of
provincial or territorial tax, the jurisdiction of residence is the jurisdiction where the taxpayer
resided at the end of the year. A trust will be resident where the trustee makes decisions.
However, special rules apply if there is more than one trustee and they are in different
jurisdictions, or there is a corporate trustee. [1.7.1.2, 1.7.1.3 (Quebec), 8.2.1]
Residuary Beneficiary: One is who entitled to receive the residue of the estate. The term is
generally used when the beneficiary takes the residue outright and there is no trust. It is
sometimes used to describe the beneficiary of a trust when the trust comes to an end. Also
referred to as Capital Beneficiary. [7.1.3] See Legatee by General Title, Residuary Beneficiary,
and Universal Legatee in Quebec.
Residue: Refers to the collection of assets and cash remaining after payment of all debts, estate
expenses, and legacies. [7.1.1, 7.1.1.4, 7.8.4.2] See Legacy by General Title and Universal
Legacy in Quebec.
Residue Clause: This is the main dispositive provision in a will. It disposes of the remainder (or
residue) of the estate. A well drafted residue clause also addresses contingencies and may
establish one or more testamentary trusts. [4.3.7.7, 4.3.7.8 (Quebec)]
Resulting Trust: These trusts arise by operation of law and when there is no express intention to
create a trust. Resulting trusts arise when one party (A) has acquired legal title to an asset but the
law determines that A is holding title on a resulting trust for the original owner (B). A must
return the property to B or to B’s estate. [2.2.5.7]
Returned (Gift to be Returned Clause). See Hotchpot Clause.
Revenue Beneficiary: Describes a beneficiary who receives the right to the enjoyment of
property granted in a will and/or to receive income earned from investments. For example, a
revenue beneficiary may be entitled to live in a house but will not be entitled to the sell it or to
receive the cash from the sale. Also referred to as Income Beneficiary and Life Tenant. [2.2.1.2]
Revenue Beneficiary in Quebec.
Revenue Cash Transaction Statements: These statements list all income received, amounts
paid to beneficiaries, and all expenses charged to the revenue account. [10.3.6.1]
Revenue Fees: Trustee fees charged to the revenue account of a trust. [9.7.1]
Revenue Transactions: These include all receipts and disbursements of income, including
interest, dividends, rents, payments to beneficiaries, non-resident withholding tax remitted to the
CRA, and certain trust expenses. [10.3.6]
Right of Indemnification: The right to reimbursement of the executor or trustee for proper
expenditures required in the administration. Recognized both in legislation and common law.
[9.7.6]
Rights: Term used to describe a trust beneficiary’s “interest” in a trust. A beneficiary’s right to
any kind of benefit under the trust is determined by the constituting act. A beneficiary may have a
current right (to payment of income, for example), or a future right (to payment of capital at a

Glossary-19
 Glossary

determinable date (e.g. a date that is specified or defined to be on the happening of a specific
event). [7.6.4.1]
Rights and Property. See Rights or Things.
Rights or Things: The executor may elect to file a separate return for “rights or things” of the
deceased person as at the date of death. Rights or things are amounts that have been earned prior
to death, are unpaid at the time of death, are payable at the time of death, and would have been
included in income of the deceased when received. [8.3.3.1] Rights and property in Quebec.
Right to Remuneration: The general principle expounded in the CCQ is that administrators of
the property of others are entitled to remuneration unless the law, the act, or the circumstances
have excluded this right. [9.8.1]
Rollover: A term used when a disposition takes place or is deemed to take place for proceeds of
disposition that are equal to the Adjusted Cost Base. The new owner acquires the original
Adjusted Cost Base and tax is deferred until the asset is sold, deemed to be sold, or some other
event arises. [8.2.1]
Seisin: The right to effectively control and possess the deceased’s patrimony. The liquidator
exercises the seisin of the heirs and legatees by particular title from the opening of the
succession and for the time necessary for the liquidation. [4.3.6.2]
Separation of Title: Refers to the fact that the title to assets and accounts owned by a trustee
must be clearly held by the trustee for the trust so that it is clear to creditors or the trustee’s
personal representative or substitute decision-maker that the trust assets are not available to
satisfy the trustee’s personal debts. [2.2.1.2]
Settlor: A settlor may be a trustee or a beneficiary and/or reserve powers. [2.2.1.5, 2.2.1.6]
Situs of Property: Refers to the location of property for legal purposes, such as taxation and
conflict of laws, and is generally the jurisdiction where the property is physically located.
[1.7.2.5]
Social Utility Purpose Trust: Social trusts are constituted gratuitously and are defined as a trust
for a purpose of general interest, such as a cultural, educational, philanthropic, religious, or
scientific purpose. Social purpose trusts can be perpetual. A foundation may be established as a
social purpose trust or as a corporation. Also called a Social Trust. [2.2.4.2]
Specific Legacy: These are gifts in a will that are described in sufficient detail to determine the
specific item that the testator intended to give the beneficiary. [7.1.1.1]
Spousal and Common Law Partner Trusts: Generally, used when the terms of the trust meet
very specific requirements of the Income Tax Act. When these requirements are met, certain tax
rules apply. The key characteristics are that a spouse (or common-law partner) of the settlor or
deceased is entitled to the trust income during the spouse’s lifetime and during the spouse’s
lifetime capital may only be distributed to the spouse. See also Trust for Persons. [2.2.5.6]
Spousal Trust (or Qualified Spousal Trust): A trust (inter vivos or testamentary) that meets the
requirements of the ITA. Generally, the spouse or common-law partner is entitled to all of the
income while the spouse is alive and only the spouse or common-law partner may be entitled to
receive or otherwise obtain the use of the capital or income during the spouse’s lifetime. Assets

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 Glossary

are transferred to the trust on a rollover basis and there is a deemed disposition on the spouse’s
death. [8.2.1]
Spouse: When two people are legally married, they are recognized as spouses. And, if they are
divorced or have a legal separation the relationship will be clearly terminated. This term is not
defined in the ITA but is understood to mean two people who are legally married or living in a
common-law relationship and can include same-sex couples. The CRA has recently confirmed
that an individual can have more than one spouse for ITA purposes (for example, where a
taxpayer is living common-law but has not legally divorced the ex-spouse). Also referred to as
Domestic Partner. [7.2.1, 8.2.1] Spouse and Civil Union Spouse in Quebec.
Springing Power of Attorney: An enduring power of attorney comes into effect when a
specified event occurs. Most donors will indicate that the event is when the donor becomes
mentally incapable of making financial decisions. The enduring power of attorney sets out the
nature of the event and the requirements for proving that the event has occurred. Some
jurisdictions have legislation that specifically addresses the requirements for making a springing
power of attorney. [2.5.2.1]
Statutory Property Guardian: A property guardian appointed without a court process. An adult
is declared incapable and the province’s Public Guardian and Trustee becomes the property
guardian. Each province also has its own laws governing how a certificate of incapability is
issued and how it can be terminated. [11.5.1]
Strata Fees: See Condominium Fees.
Stub Period: If a testamentary trust has a fiscal year end (e.g. not December 31), and the
beneficiary dies after that date, the stub period is the period of time between the last fiscal year
end of a trust and the date of death of the beneficiary. Any income earned and/or payable in the
stub period can be reported on a separate return. Similar rules may apply to partnership or
proprietorship income. [8.3.3.2, 8.3.3.3]
Substantial Compliance Legislation: Intended to be remedial, this legislation allows a court to
remedy a situation by permitting the wishes of a deceased person to be followed even if the
formalities of execution required for a conventional will are not met. [3.2.2.9]
Substitute Decision-maker: “The term used to describe a person who is appointed to make
decisions for an adult who is not mentally capable of making decisions in one or more decision-
making areas (i.e. financial and legal decisions, personal care decisions, and health care
decisions). Substitute decision-makers are appointed by an adult, while mentally capable, or by
the courts. Also referred to as Attorney, Committee, Guardian, and Proxy. [2.5.1] Mandatary to
the Property/to the Person in Quebec.
Succession: A term used to refer to all of the property to be transmitted to the heirs. The term is
also used to refer to all of the heirs collectively. In Quebec, the succession (whether testate or
intestate) refers to its transmission to the heirs and the liquidation and partition of assets. The
succession is either an intestacy (it is transmitted by operation of the law), or testamentary in
nature (it devolves by testamentary disposition, including gifts mortis causa). [4]
Successor. An heir who has not yet exercised his or her option to accept or renounce the
succession. [7.1.3] See also Heir.

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 Glossary

Summary of Assets and Liabilities. See Estate Summary.

Suretyship: A suretyship terminates on the death of the surety, however the estate of the surety
remains libale for debts existing at the time the suretyship was terminated. [6.1.2.6] See also
Guarantee.
Survivorship Clause: This clause in a will sets out the number of days that a beneficiary must
survive if he or she is to be a beneficiary. It can have important implications for the distribution
of an estate and can avoid the risk of successive applications for probate where the ultimate
distributions are identical. [4.3.7.10]
Survivorship Rules: The legislative rules that determine who survives when the testator or an
intestate person dies at the same time as a beneficiary. The rules may also require a beneficiary
to survive a certain number of days. [7.7]
T1. See Terminal Return.
T3. See Trust Income Tax and Information Return.
Tenants in Common: When property is owned in this way, each owner has a percentage
ownership. Each is free to sell his or her share and when an owner dies, the owner’s share is part
of the owner’s estate and passes according to his or her will. See also Co-Ownership, Joint
Tenants with Right of Survivorship. [3.7.6.1, 5.5.1.1] See Undivided Co-Ownership in Quebec.
Terminal Return (T1): A T1 General Income Tax Return is used to file the deceased’s terminal
return. This return reports all income earned from January 1 up to and including the date of
death, rather than December 31. [8.3.1]
Testament: See Will.
Testamentary Expenses: These are incurred by the executor in order to administer the estate.
They are recorded in the accounts provided to the beneficiaries. Expenses must be reasonable. If
an estate expense is successfully challenged, the executor can be held personally responsible for
part or all of the expense. Some of the more common expenses are funeral expenses, appraisal
fees, professional service fees, property insurance premiums, security or inspection services to
protect assets, probate fees/taxes, property taxes, utility bills, and condominium fees. Executor
fees are also an expense but must be specifically approved. [6.1.1.3]
Testamentary Gift: A gift made in a will that is intended to take place on the death of the
testator. Therefore, a testamentary gift has no legal effect while the testator is still alive. [3.1.1]
Testamentary Trust: When a trust is created on death, the trust is set out in the deceased’s will
and is called a “testamentary trust”. When the estate is administered, the residue of the estate or a
specified amount or asset is set aside and administered as a trust. In addition to signalling that the
trust was created on the death of the testator (or settlor), this distinction is important for tax
purposes because special rules apply to testamentary trusts. [2.2.5.2]
Testator: The person who makes a will is called a testator (male) or testatrix (female). [2.3.1.1.]
Testatrix: See Testator
Testimonium Clause: This is a statement at the end of the will summarizing who was present
and signed the will. [4.3.10.1] Declaration Clause in Quebec [4.3.10.2]

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 Glossary

Three Certainties: One of the requirements to create a valid trust. They are certainty of
intention, certainty of subject matter, and certainty of objects. [2.2.6.2]
Trust: A trust is a fiduciary relationship where one party (the settlor) transfers property to
another (the trustee) to hold title to and manage that property for the benefit of a third party (the
beneficiary) who has the exclusive enjoyment of the property. [2.2.1.2, 2.2.1.7 (Quebec)]
Trust Agreement. See Trust Deed.
Trust Deed: The document that evidences the trust – especially in the case of an inter vivos trust
as testamentary trusts are usually set out in the will. Also referred to as Trust Settlement.
[2.2.5.2] Trust Agreement and Trust Deed in Quebec.
Trustee: Those appointed to manage a trust for the benefit of others. [1.1]
Trustee Duties: Trustee duties are mandatory. They include the duty of care, duty not to
delegate, duty of loyalty (no conflict of interest), duty of impartiality, and duty to account
(provide information). [2.2.10]
Trust for a Disabled Person (Henson Trust): A fully discretionary trust created to provide for
a beneficiary who is a disabled person entitled to receive certain provincial benefits, which may
range from income assistance to access to specialized services. Where a trust is fully
discretionary, subject to provincial legislation that provides otherwise, benefits will not be
discontinued if the distributions from the trust meet provincial criteria. See also Trust for
Persons. [2.2.5.6]
Trust for Persons: Whether inter vivos or testamentary, this trust benefits one or more persons.
It includes legal entities such a specific charity or other legal entity entitled to enforce the interest
in the trust. Trusts for persons are often created to achieve one or more objectives. As a result
many additional classifications and names have evolved to describe the nature of entitlement for
one or more beneficiaries. The names may also signal that a trust meets specific tax rules and, as
a result, attracts certain tax treatment. Also called Personal Trust. [2.2.5.3]
Trust for Purposes: This trust does not have individuals or specific entities as beneficiaries.
Rather, the trust funds are to be held and used for specific purposes. These trusts may be for
charitable or non-charitable purpose trusts. The distinction is important because different laws
apply to how long the trust can continue and different tax laws apply. Also called Purpose Trusts.
[2.2.5.3]
Trust Income Tax and Information Return (T3): This Return is filed by an estate to report
income earned by the estate after the date of death. T3 returns are also filed for testamentary and
inter vivos trusts. It is filed by the executor annually until the administration and distribution of
the estate assets has been completed. It is generally referred to as a trust return or T3 return.
[8.2.3, 8.4]
Trust Power: A trust power gives the trustee authority to make decisions or take certain actions
in order to administer the trust. For example, most trust documents set out detailed investment
powers. Trustee powers are found in the trust document. However, if the trust is silent on certain
powers, legislation provides a number of default powers in order to assist a trustee with the
administration of the trust. [2.2.11]

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 Glossary

Tutor. See Fiduciary, Guardian, Personal Guardian, Property Guardian.

Ulysses Agreements: This is an advance instruction, typically given by a person with a known
mental illness, to prevent the “maker” from the consequences of expressing inappropriate and
unwanted instructions made at a later date when under the influence of the mental illness.
[2.5.3.4]
Undivided Co-Ownership: Where two or more people own an account or asset together the
shares of property held in undivided co-ownership are presumed to be owned equally. The fruits
and revenues of the undivided property accrue to the co-owners in proportion to their respective
shares and costs of administration and other common charges of the property are paid by the co-
owners in proportion to their respective shares. [5.5.1.1.] See also Co-Ownership and Tenants in
Common.
Undue Influence: Refers to a situation where someone exerts influence on the testator and that
influence causes the testator to execute the will or a provision in it. Where the testator has been
unduly influenced, the will is not the result of the testator’s voluntary actions. If it is shown that a
testator was unduly influenced, the will or provision in question will be invalid. There must be an
element of force or coercion so great that the testator’s will was not made freely and voluntarily.
[3.2.5.2]
Universal Legacy: This type of residue clause entitles one or more persons to take the entirety of
the succession. [4.3.7.8]
Universal Legacy: This type of Quebec gift entitles one or more persons to take the entire
succession. [7.1.2]
Unjust Enrichment Claims. See Quantum Meruit Claims.
Usufructary. See Life Tenant.
Vested Indefeasibly: An absolute vesting of the beneficiary’s interest occurs when the
beneficiary’s claim on the trust property does not depend on some future event (or contingency)
that may or may not occur. [7.6.2]
Vested in Interest: When the interest is postponed to a future date. See also Vested Subject to
Divestment [7.6.2]
Vested in Possession: When a beneficiary’s interest is immediate. See also Vested Indefeasibly.
[7.6.2]
Vested Subject to Divestment: The beneficiary’s entitlement may come to an end when, or if, a
condition that stops the interest occurs. For example, it could end upon the beneficiary turning a
certain age or meeting some other criteria. It could also end if the beneficiary dies before the
event that would have triggered the entitlement. [7.6.2]
Vested Interest: A beneficial interest where the beneficiary has the right to benefit from the
trust property. See also Vested Indefeasibly, Vested Subject to Divestment, Vested in Possession,
and Vested in Interest. [7.6.2]
Vesting: In the context of this course, vesting refers to the transfer of legal title to the executor
so that the executor may sell or otherwise deal with the assets or transfer them to beneficiaries. A

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 Glossary

clause within the will vests all of the testator’s property in the executor. [4.3.6.1] See also Seisin
for Quebec.
Will: A document that disposes of a person’s property (“estate”) on that person’s death. A will
can be revoked or amended before death as long as the testator has testamentary capacity. Wills
do not create legally enforceable rights or obligations vis à vis the testator during his or her
lifetime. Sometimes a will is called a “testament”. If a person dies having made a valid will he or
she is said to die “testate”. Every province and territory has legislation that sets out the
requirements for making a valid will. [2.3.1, 3.1.1, 3.1.4.2] See Notarial Will for wills made in
Quebec.
Will Before Witnesses: A valid conventional will. [3.2.2.8] See Conventional Will.
Witness: To witness the testator (or his or her designate) sign a will, the witness should not be a
beneficiary of the estate or the spouse of a beneficiary. An executor may be a witness. [3.2.2.4]
Worldwide Income: Canadians are taxed on their worldwide income, which includes income
from all sources whether located in Canada or otherwise. [8.1.1]

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