One of the first responsibilities of any executor is to make funeral arrangements for the deceased. But what if the will doesn’t mention funeral arrangements? Who decides what happens at the funeral—and at what cost?

Wide discretion

Mary-Jane Wilson, partner at Wilson Rasmussen LLP in Surrey, B.C., says executors have final say on all decisions from a legal perspective. “It’s completely up to them,” she says. “Sometimes the funeral arrangements are specified in the will—to be cremated, to be buried, etcetera. [But those arrangements are] not actually binding.” Regardless, including instructions in a will can make an executor’s job easier, since she would have fewer decisions to make.

While such discretion is wide, it is not absolute. As Wilson points out, executors have a duty to be reasonable in their choices about how much to spend on a funeral, and on what. Unfortunately, there are no recommended amounts or common standards. “A lot will depend on the size of the estate, [and] the station in life of the person who’s passed away. So if you have a $50,000 estate, it’s not reasonable to spend $20,000 on funeral arrangements. If you have a much larger estate, you might want to spend a bit more.”

If executors spend too much on funeral arrangements, they may be held personally liable for overspending. “In the end, the executor will account to the beneficiaries, and say, ‘This is what I started with, this is what I ended up with and this is what I spent it on in between,’ ” Wilson says. If heirs take dispute with that, the court will have to decide whether the spending was reasonable. “If the court says you spent too much, you’re personally responsible.”

For that reason, Wilson says it’s a good idea for executors to include others in the decision-making process. Staying close to what the testator stipulated in his or her will is usually a good idea, but if the will doesn’t mention funeral arrangements, executors should meet with family members and ask what they envision. “Communication between the beneficiaries and the executor is the key,” she says. “[An executor] may go back to [the] beneficiaries, and say, ‘Ok, this is what [the testator] wanted, this is the money I’m working with. What do you guys want to do?’”

Testators who remain concerned about whether their wishes will be followed, Wilson says, can pre-pay for funeral arrangements. “[It’s] easy for your executor, [and] your kids can’t really question it, because you paid for it.”

Not a common problem

While Sylvan Schneider, principal, Schneider Attorney Inc. of Montréal, acknowledges that funeral arrangements could cause conflict, in his experience, it’s not a common problem. “In all my years, I’ve never come across an issue where people had a [problem] over the decisions made regarding the funeral,” he says.

If anything, funeral arrangements are the one area where executors, heirs and other family members are usually in accord. “The funeral is the easiest part—it’s after the funeral that’s when people start going bananas,” he says. “Most people want to honour the deceased in an appropriate fashion, taking into consideration the budget and acting in the best interests of the deceased.”

Schneider has noticed that some people are making their own funeral arrangements by pre-paying or pre-arranging their funerals before they die. “People are getting savvier, more knowledgeable, more detail-oriented and more precise regarding what they want in their wills, to ensure that there is no dispute,” he notes.

While including direction in the will is a good idea, Schneider suggests that testators who want to be absolutely sure their wishes will be respected add a memorandum or annex to the formal will. In that document, the testator provides specific details on what the funeral should look like, as well as how much money the executor should spend.

What’s a funeral expense (and what isn’t)?

The following items are considered funeral expenses, and are typically paid by the estate via the executor:

  • burial plot in a cemetery or similar locale;
  • funeral home services (i.e., care and/or preparation of the deceased, obtaining the death certificate, hosting the service, burial/cremation fees, etc.);
  • casket (burial) or urn (cremation);
  • clothing for the deceased to wear during the service;
  • flowers for the service;
  • obituary in newspaper(s) where the deceased lived or was well-known;
  • lunch or reception following the service; and
  • honorarium for the person conducting the service.

The following are not considered funeral expenses. Executors are under no obligation to pay for them with estate funds, although heirs sometimes ask. Executors who allow such payments may be forced to reimburse the estate for the expense unless heirs agree that such payments constitute an advance on what they’ll eventually receive from the estate.

  • Airfare/mileage allowance/car rental for out-of-town heirs and/or family members who attend the service
  • Hotel, meals and clothing costs for heirs or family while attending the service
  • Headstone or other permanent memorial in a cemetery or other locale

James Dolan is a Vancouver-based financial writer.

Originally published in Advisor's Edge

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