Future Estates and Life Estates

(Ontario)

Before his death, Bill had written a Will in which he granted his wife Mary a life estate for the cottage property and a future estate for their son Bob. Mary is a business executive for a multinational corp. travels a lot and leases the cottage to a tenant on a 10- year lease contract. Unfortunately, Mary is in an accident 4 years after leasing the cottage and passes away.

Bob now wants to terminate the lease and occupy the cottage himself.  What would be the status of the lease in this situation:

A. The cottage becomes Mary’s estate and is now the landlord for the tenant.

B. since 6 years are still remaining in the valid lease, Bob will not be able to occupy the cottage. 

C. If the lease was registered on title, the lease would be valid, and the tenant can stay for the remaining 6 years.

D. The lease ceases to exist upon Mary’s death and Bob can obtain vacant possession of the cottage? 

Answer:

Assuming that the Lease was not registered, Bob is effectively “on notice” with respect to three years. So, the Tenant gets to stay for that period of time only. Then, Bob can occupy the premises. For the 3 year period, Bob is entitled to the rent, and then occupancy.

However, had there been documents registered on title indicating that Mary’s interest was a life interest, then, 60 days’ notice would be all that was required.

Brian Madigan LL.B., Broker

www.OntarioRealEstateSource.com

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