In Ontario, estate trustees may be personally liable for debts owed by the deceased if the trustee distributes the assets of the estate to the beneficiaries without first having advertised for creditors. Section 53 of the Trustee Act, R.S.O. 1990, c. T.23 allows estate trustees to protect themselves from this liability. Estate trustees will not be liable for debts owed by the deceased if they publish notice to creditors, sometimes referred to as public notice, informing them that the estate is being administered and specifying the date by which any outstanding creditors must bring forward their claims:
53 (1) A trustee or assignee acting under the trusts of a deed or assignment for the benefit of creditors generally, or of a particular class or classes of creditors, where the creditors are not designated by name therein, or a personal representative who has given such or the like notices as, in the opinion of the court in which such trustee, assignee or personal representative is sought to be charged, would have been directed to be given by the Superior Court of Justice in an action for the execution of the trusts of such deed or assignment, or in an administration suit, for creditors and others to send in to such trustee, assignee or personal representative, their claims against the person for the benefit of whose creditors such deed or assignment is made, or against the estate of the testator or intestate, as the case may be, at the expiration of the time named in the notices, or the last of the notices, for sending in such claims, may distribute the proceeds of the trust estate, or the assets of the testator or intestate, as the case may be, or any part thereof among the persons entitled thereto, having regard to the claims of which the trustee, assignee or representative has then notice, and is not liable for the proceeds of the trust estate, or assets, or any part thereof so distributed to any person of whose claim there was no notice at the time of the distribution.
The convention had been to advertise to creditors by publishing a legal notice multiple times in the local newspaper where the deceased lived. If the deceased worked in a different city, notice would be published in that local newspaper as well. The convention of advertising in print newspapers was effective in an era when business was conducted locally and most people read the daily newspaper. In an interconnected online world, it makes more sense to reach creditors by publishing notice over the Internet. The Superior Court of Justice has confirmed that advertising for creditors on NoticeConnect will protect a trustee from liability. Read the court decision
NoticeConnect has been used to advertise for creditors in other provinces and jurisdictions. Consult an estates practitioner to determine if NoticeConnect is consistent with the statutory requirements in your jurisdiction.