The recent Qu\u00e9bec Superior Court decision in No\u00ebl<\/em> c. Birk<\/em><\/a><\/a><\/a> (2026 QCCS 187) provides valuable insights into the distribution of estates that include registered assets, such as registered retirement income funds (\u201cRRIFs<\/strong>\u201d).<\/p>\n\n\n\n The dispute arose following the testator\u2019s death. According to the will, the testator\u2019s surviving spouse and his two daughters were to inherit equal shares of the residue of the estate. However, there was no clause in the will that addressed the registered assets specifically.<\/p>\n\n\n\n In Qu\u00e9bec, many married testators include a specific clause bequeathing registered assets, such as registered retirement savings plans (\u201cRRSPs<\/strong>\u201d) or RRIFs, to their surviving spouse. This practice leverages the tax rollover provided by law, which allows these assets to be transferred to a spouse without triggering immediate taxation. It also acknowledges that a latent tax liability will eventually accompany future withdrawals, thereby avoiding any penalty to the surviving spouse at the time of distribution. However, in the testator\u2019s case, the registered assets were not addressed in a specific bequest and were therefore included in the estate to be divided equally.<\/p>\n\n\n\n The liquidator proposed a distribution in which the testator\u2019s surviving spouse would receive the deceased\u2019s RRIF and the two daughters would receive equivalent amounts in cash. The surviving spouse objected, arguing that the RRIF\u2019s face value did not account for the latent tax liability that she alone would have to bear.<\/p>\n\n\n\n Her co-heirs sided with the liquidator, claiming that the surviving spouse changed her position after initially agreeing to the RRIF transfer in 2021. However, the court found that the correspondence did not constitute an agreement as to the RRIF\u2019s distribution value; it confirmed only her consent to the tax rollover.<\/p>\n\n\n\n Justice Girard noted that the liquidator\u2019s role is to propose a distribution plan, and it is then up to the heirs to decide whether to accept it or not. If they cannot agree, the court must protect the testator\u2019s intentions and ensure fair distribution. In this case, the testator\u2019s intentions were clear: he wanted his estate divided equally. The question was whether the shares were truly equivalent in value, not just in appearance.<\/p>\n\n\n\n To reach a conclusion, the court relied on article 851 of the Civil Code of Qu\u00e9bec<\/em>, which expressly provides that fiscal consequences may be considered when composing the shares of an estate. The court also cited specialized secondary sources recommending that the latent tax liability attached to registered assets be factored in. An RRIF does not have the same economic value as a non-registered asset, even if their market values are identical, because the tax burden will inevitably reduce what the heir receives.<\/p>\n\n\n\n The court found that the heirs had not agreed on a method for calculating the surviving spouse\u2019s share. The court also noted that her objection was raised promptly and not opportunistically. Justice Girard therefore ruled that the liquidator\u2019s proposed distribution did not respect the testator\u2019s intentions or the principles of estate fairness. Justice Girard concluded that the RRIF could be transferred to the surviving spouse but that its value for distribution purposes must be adjusted to reflect the latent tax liability.<\/p>\n\n\n\n To ensure fair distribution, the court ordered the liquidator to hire an independent tax expert to determine the RRIF\u2019s transferable value, considering the tax liability and any taxable capital gains. If the tax rollover is no longer available due to the time elapsed, the RRIF must be deregistered by the estate, and the net proceeds must be divided among the heirs. This decision highlights the importance of acting promptly when administering registered assets.<\/p>\n\n\n\n The court dismissed the abuse allegations raised by both parties. Neither the surviving spouse\u2019s objection nor her co-heirs\u2019 claims met the high threshold required to characterize the conduct or proceedings as abusive. The court also rejected the request for the estate\u2019s professional fees to be charged to the surviving spouse.<\/p>\n\n\n\n This decision highlights the importance of careful will planning when a person owns registered assets. A married testator who wishes for their spouse to benefit fully from the tax rollover would do well to include a specific clause covering these assets to avoid ambiguity.<\/p>\n\n\n\n\n
A will without a specific RRIF clause<\/h2>\n\n\n\n
Dispute over the RRIF\u2019s true value<\/h2>\n\n\n\n
Estate fairness under the Civil Code of Qu\u00e9bec<\/em><\/h2>\n\n\n\n
Practical guidance for the liquidator<\/h2>\n\n\n\n
No finding of abuse<\/h2>\n\n\n\n
Key takeaways<\/h2>\n\n\n\n