Deceased estates

Contributed by Ian Macdonald and current to 1 September 2005

If a person dies during the time he or she is bankrupt, the bankruptcy continues. If a person has not been bankrupt, but dies owing debts totalling more than assets, it is possible for a creditor or the person administering the estate such as an executor, to seek an order for the administration of the estate in insolvency. This means that the person’s property is divided up amongst the creditors in a way comparable to that in the bankruptcy of a live person.

Executors involved with a deceased estate who find that the debts total more than the assets should not dispose of any of the assets. A creditor may wish to administer the estate in insolvency.