The tax consequences of an owner dying before a sale closes are covered elsewhere in this library. This page is about a different, more immediate question: on the morning after the death, before any grant of probate has been applied for, what can the executor named in the will actually do — sign documents, keep the business running, move shares — and what will simply not move until the court has confirmed them?
Key takeaways
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Ontario’s Estates Administration Act provides that all of a deceased person’s property “devolves to and becomes vested in his or her personal representative… as trustee for the persons by law beneficially entitled thereto” — from the time of death, not from the date a court later confirms the appointment. For an executor named in a valid will, the practical effect is that legal authority to act for the estate exists from the moment of death; the eventual grant of probate is confirmatory rather than the thing that creates the authority in the first place. That is a different position from an administrator appointed where there is no executor or no will, whose authority is generally treated as arising only once the court makes the appointment.
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The corporate statute governing private company shares entitles a person in the executor's position to become the registered holder of a deceased shareholder's shares only on depositing the original grant of probate or letters of administration, or a certified copy of it, with the corporation or its transfer agent. Until that happens, the corporation is not obliged to record the transmission or treat the executor as the owner for voting or transfer purposes — an exception exists only where the law governing the shares does not require a grant in the first place, which is not the ordinary Ontario position. This is the gap between vesting and registration: the executor may already hold legal authority over the shares in substance, and still be unable to get a bank, a transfer agent, or a buyer's lawyer to act on that authority without the certificate in hand.
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Treadstone Law's answer on this is that most wills give the estate trustee broad enough authority to sell a family business even without saying so specifically — but broad authority to sell is not the same as authority to keep operating it, and a will that is silent on carrying on the business is a materially different situation. An executor who ran the company for two years shows what that silence cost: exposure on the trustee side for how the shares were being managed, and separately on the corporate side for acting as a director. Both exposures existed at once, and neither was solved by the other.
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How the deceased owner’s final tax return and the estate’s own filings interact with a pending or completed sale — the deemed disposition at death, the spousal rollover, and the loss carryback available to a graduated rate estate — is a distinct set of rules from the authority question on this page; see what happens when the owner dies before the sale closes. The executor who paid out before the clearance certificate arrived and can an executor be personally liable for a company's unpaid taxes cover a different personal-liability trap on the tax side.
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Ontario’s Estates Act allows a probate application to be limited to part of the deceased’s property, so that only the value of what the limited grant actually covers needs to be sworn to the registrar — the basis for keeping privately held company shares out of the public estate certificate while other assets go through in the ordinary way. Two wills and the shares that never reached probate shows this used on a $7.4 million private-company shareholding. This is background for the conversation, not a substitute for it — Treadstone is an AI consulting firm, not a law firm or an accounting practice, and the specific numbers and elections below belong to your own accountant and an estates or corporate lawyer working from your actual figures.
No. Under Ontario’s Estates Administration Act, the deceased’s property vests in the personal representative from the moment of death, as trustee for those entitled to it — the grant of probate confirms that authority rather than creating it.
No. The corporation is entitled to require the original grant of probate, or a certified copy, before registering the executor as the shareholder — vesting at death and registration on the share ledger are not the same event.
No. Ontario’s Estates Act allows a probate application to be limited to part of the deceased’s property, which is the mechanism used to keep privately held company shares off the public estate certificate while other assets go through normally.
Sources
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