Joint with right of survivorship | General financial discussion | Discussion forum

No and no.

There is no early redemption should one of the joint tenants die.

Under provincial property laws, GIC issuer is obligated to delete the name of the deceased from the ownership on proof of death and consent of the surviving owner(s).

I agree with Norman's post #9. It continues to exist in joint names until the last surviving owner dies. Then it is a bloody mess when the Executor of the 'last to die' owner has to discharge/liquidate the assets.

There is a legal process to resolve such cases but I do not recall what it is. I read some time ago of a case in which a principal residence fell into this category. The only detail I remember is the 'last to die' survivor had also been the Executor of the estate of her previously deceased husband. There was no Executor left to discharge his ownership and the Executor of her estate had to deal with that mess.

For the purposes of this thread, the JTWROS GIC would continue to remain in effect until it either matured, or the appropriate evidence (death certificate) was presented to take the deceased off title. Non-redeemable GICs cannot be 'early redeemed' unless* and until 'the last to die' owner passes and the Executor presents death certificate, Will and Letters (Grant) of Probate to 'mature' the GIC and request disbursement of proceeds to the beneficiaries.

* I am not aware of any FI that would not 'early mature' a non-redeemable GIC upon the death of the 'last to die' owner of the GIC. It pays out accrued interest to the date of death. It is exactly what I, as Executor, did for my mother's estate.

Thank you. I could not recall the details,

Why early redemption due to the loss of one of the owners would be considered (with or without accrued interest) in most* cases defies logic to me. It is not like the GIC has become 'ownerless' with surviving owner(s). Goodwill perhaps.

* An example of where that would logically be considered is if the surviving owner(s) did not actually have a beneficial interest in the GIC, i.e. it was in joint name for operating convenience only, and the assets really belonged to the estate for distribution to other parties (as established by the courts or otherwise).

I still have no idea how a joint GIC can remain joint when one holder dies, who is it still joint with? Nobody.

Here's an excerpt from TD Bank GIC Terms form: "If you are opening a joint GIC or Term Deposit, you understand
that it has a right of survivorship. It is your intention that, upon
your death, the joint GIC or Term Deposit automatically
becomes the property of the surviving joint holders of the GIC
or Term Deposit."

So it "automatically" becomes property of survivor(s), no dead people allowed.

Bill said
…
So it "automatically" becomes property of survivor(s), no dead people allowed.

No, it is not automatic.

Survivor is automatically entitled to the property. But, entitled to ownership is not the same as having ownership. BC lawyers Taylor & Taylor illustrates the nuance in Dealing With Real Estate In BC After Death using the joint ownership of a property:

In a joint tenancy, when one joint tenant dies, the surviving joint tenant is automatically entitled to the deceased’s share of the property. Although the right is automatic, it is necessary to file paperwork with the BC Land Title and Survey Authority (LTSA) to make the transmission effective. Generally speaking, this includes filing the original death certificate and accompanying LTSA filing form (typically, a Form 17 Fee Simple) with the Land Title office, along with payment of a processing fee.

After the LTSA processes the application for transmission to surviving joint tenant (this process may take a few weeks or more), the deceased owner’s name will be removed from title, leaving the surviving joint tenant as the sole owner.

If no-one takes the steps to delete deceased joint tenant owners from the ownership of a house or a GIC, then the deceased remain owners.

The deceased wasn't dead when he or she put money into the GIC or bought the piece of land. So, the deceased can certainly continue to be named a joint tenant owner of a GIC or a piece of land.

The TD document does not say removal of the deceased name is automatic. The document says that it is the joint tenant's intention for the removal to be automatic and that the joint tenant acknowledges any automatic removal:

Right of survivorship means it is your intention that, upon your death, the joint GIC or Term Deposit automatically becomes the property of the surviving joint GIC or Term Deposit holders. By choosing a joint GIC or Term Deposit, you acknowledge that, after any GIC or Term Deposit holder's death, the GIC or Term Deposit automatically becomes the surviving holders' property. …

RBC Royal Bank has more explicit text that the removal is "automatic". But, the removal of the deceased joint tenant is not actually automatic.

Once the RBC branch is contacted about the death, a request is sent to an RBC department that handles death and estate matters. That department will send a package of instructions and paperwork to apply for the removal of the deceased's name from the joint accounts.

Along with proof of death, a form signed by the surviving joint account holders needs to be returned. The form declares the survivors' support for the application to delete the deceased's name from the joint accounts.

The "automatic" in those documents just means that no involvment by the deceased or the deceased's executor is needed to remove the deceased's name from the ownership of the joint tenant accounts. "Automatic" doesn't mean someone can just show up with a death certificate without the written support of the surviving joint tenants and request the change.