Estate Wins CPP Death Benefit Appeal Against Another Claimant

OUTCOME: Allowed

Citation: [NAME]  v  [RESPONDENT] and [NAME] and SC , 2026  [NAME]  291 [NAME] Tribunal of Canada Appeal Division Leave to Appeal Decision Appellant: [redacted] Representative: E. S. Respondent: [redacted] [COUNSEL] Party: [NAME]. Decision under appeal: [NAME] decision dated September 11, 2025 (GP-25-794) Tribunal member: [NAME] of hearing: Teleconference Hearing date: March 31, 2026 Hearing participants: [NAME] representative Respondent’s representative [NAME] date: April 14, 2026 File number: AD-25-759 On this page Decision Overview Issues Analysis Conclusion Decision [ 1 ] I am allowing this appeal. The Appellant is entitled to a [NAME] ( [NAME] ) death benefit. The Minister should not have awarded the benefit to [NAME]. Overview [ 2 ] This case involves two competing claims for the [NAME] death benefit. [ 3 ] [NAME]. [NAME], a [NAME] to the [NAME] , passed away on October 28, 2022. He didn’t leave a will. On November 20, 2023, [NAME] applied for the [NAME] death benefit. Footnote 1 In her application, she said that she was J. [NAME].’s goddaughter and that that she was responsible for his funeral expenses. She submitted an invoice from a funeral home addressed to her in the amount of $10,097. Footnote 2 [ 4 ] Service Canada, the Minister’s public facing agency, approved the application and paid [NAME] the maximum death benefit of $2,500. [ 5 ] On January 10, 2024, J. K.’s [NAME] ([NAME]) submitted an application for the death benefit. Footnote 3 In the application, Dr. [NAME] said that he was [NAME]. [NAME].’s first cousin, and he provided evidence that he was the court-appointed administrator of the [NAME]. Footnote 4 [ 6 ] Service Canada denied the [NAME] application, saying that it had already granted the death benefit to someone else. [ 7 ] The Appellant appealed Service Canada’s decision to the [NAME] Tribunal. The Tribunal’s [NAME] held a hearing by teleconference and dismissed the appeal. It found that Service Canada had considered the [NAME] application in a judicial manner and that the death benefit had been properly granted to [NAME] under the law. [ 8 ] The [NAME] representative then applied for permission to appeal to the [NAME]’s decision. In December, one of my colleagues on the Appeal Division granted him permission to appeal because she saw an arguable case that the [NAME] failed to provide the parties with a fair hearing. [ 9 ] Last month, I held a hearing on the merits of the parties’ respective cases. Issues [ 10 ] This appeal requires me to answer two questions: Did Service Canada consider the [NAME] death benefit application in a judicial manner? If not, is the Appellant or [NAME] entitled to the death benefit under the law? Analysis [ 11 ] The law governing the [NAME] death benefit is surprisingly complex. Section 71 of the [NAME] makes it clear that the [NAME] of a [NAME] has priority, subject to certain exceptions, over other potential claimants: [redacted] (2) The Minister may direct payment of a death benefit in whole or in part to such person or body as is prescribed where (a) he is satisfied, after making reasonable inquiries, that there is no [NAME]; (b) the [NAME] has not applied for the death benefit within the prescribed time interval following the [NAME]’s death; or (c) the amount of the death benefit is less than the prescribed amount [emphasis added]. [ 12 ] Use of the word “or” in section 72(2) indicates that only one of the three enumerated factors needs to be in effect for the Minister to consider paying the death benefit to a party other than the [NAME]. The “prescribed time interval” mentioned in section 72(2)(b) is important, and it is specified in section 64(1) of the [NAME] ( [NAME]): 64 (1) When paragraph 71(2)(a) of the Act applies or when the [NAME] of a [NAME] has not applied for the death benefit within the interval of 60 days after the [NAME]’s death, or when the amount of the death benefit is less than two thirds of 10% of the Year’s Maximum Pensionable Earnings for the year in which the [NAME] died, in the case of a death that occurred before January 1, 1998, or less than $2,387, in the case of a death that occurred after December 31, 1997, a direction under subsection 71(2) of the Act may, subject to subsections (2) and (3), be given for payment of the death benefit (a) to the individual or institution who has paid or is responsible for the payment of the [NAME]’s funeral expenses; (b) in the absence of an individual or institution described in paragraph (a), to the survivor of the [NAME]; or (c) in the absence of an individual or institution referred to in paragraph (a) and a survivor referred to in paragraph (b), to the next of kin of the [NAME] [emphasis added]. [ 13 ] [NAME]  v  Canada is the leading case on how the [NAME] death benefit provisions are to be applied. Footnote 5 [NAME] ’s facts differ from the present case, the Federal Court of Appeal set down several broad principles: […] subsection 71(1) does not provide that the Minister’s duty to pay a death benefit to the [NAME] of the [NAME] ceases if the [NAME] does not apply for it within 60 days of the [NAME]’s death. The only effect of a failure by the [NAME] to apply within 60 days of the death is to trigger the discretion exercisable by the Minister under subsection 71(2) to pay the benefit to statutorily prescribed persons, who do not include the [NAME] of the [NAME]. The Minister’s obligation to pay to the [NAME] under subsection 71(1) continues, even if representatives of the [NAME] do not apply for death benefit within the 60 days. [ 14 ] [NAME] also makes it clear that “the only statutory liability of the Minister to pay a death benefit is owed to the [NAME].” By implication, everything else is left to the Minister’s discretion, as indicated by used of the word “may” in section 71(2) and again in section 64(1) of the [NAME]. The Minister did not exercise her discretion judicially [ 15 ] The Minister has two types of power: mandatory and discretionary. The first describes things the Minister must do under the law; the second describes things that are optional — powers the Minister can use if she wants to but doesn’t necessarily have to. [ 16 ] In this case, the Minister granted [NAME] the death benefit because the [NAME] had not applied for it within 60 days of his death. That activated the Minister’s discretionary power to award the benefit to someone else. [ 17 ] But even for discretionary powers, the Minister can’t simply do whatever she feels like doing. She must comply with whatever restraints are set out in the legislation, and she must exercise her discretionary powers in a judicial manner. When exercising discretionary power, the Minister must follow legislative and judicial guidelines [ 18 ] The courts have defined what it means to exercise discretionary power judicially. Footnote 6 The Federal Court has held that a discretionary power is not exercised judicially if the decision-maker: (i) acted in bad faith; (ii) acted for an improper purpose or motive; (iii) took into account an irrelevant factor; (iv) ignored a relevant factor; or (v) acted in a discriminatory manner. Footnote 7 [ 19 ] In deciding who gets a death benefit once the 60-day period has passed, the Minister must not only exercise her discretionary power judicially, she must also consider a legislated list of potential recipients. Here, the Minister eventually paid the benefit to [NAME], having determined that she was the one responsible for the [NAME]’s funeral expenses. The Minister ignored relevant factors [ 20 ] In refusing the [NAME] application, the Minister offered no other reason than someone else had qualified for the death benefit. Put another way, it appears that the Minister approved [NAME] largely because she applied first. But in doing so, the Minister appears to have ignored these relevant factors: The Minister’s continuing obligation, as emphasized by [NAME] , to pay the death benefit to the [NAME] under section 71(1) of the [NAME] even if representatives of the [NAME] hadn’t applied for it within the 60 days. The practical impossibility for the [NAME] to have applied for the death benefit within the 60-day deadline set out in section 64(1) of the [NAME]. [ 21 ] [NAME]. [NAME]., like many Canadians, died without a will, which meant that there was no one readily available to lawfully represent his [NAME]. Dr. [NAME] testified that he did not learn of [NAME]. [NAME].’s death until three weeks after he died. He said that it then took another 10 months to be appointed administrator of his cousin’s [NAME]. On his appointment, he promptly applied for the death benefit but by then it was too late; [NAME] had beaten him to it. [ 22 ] I see no indication that the Minister considered the possibility that, because [NAME]. [NAME]. died intestate, no one had the authority to apply on his [NAME]’s behalf within the tight timeline set out in the [NAME]. For that reason, I find that the Minister failed to exercise her discretion judicially in rejecting Dr. [APPELLANT] application. The Appellant is entitled to the death benefit [ 23 ] Because the Minister ignored a relevant factor, I now have to decide whether the Appellant should get the death benefit. In doing so, I will do what the Minister should have done — apply section 71(2) of the [NAME] and section 64(1) of the [NAME] while taking care to exercise my discretion in a judicial manner. For the following reasons, I find that the Minister should not have awarded the benefit to [NAME]. The [NAME] was not barred from getting the death benefit after 60 days [ 24 ] In this case, the overriding factor, which the Minister ignored, is the fact that the [NAME] ultimately paid for [NAME]. [NAME].’s funeral. [ 25 ] As noted, section 71(1) of the [NAME] requires the Minister to pay the death benefit to the [NAME] of a [NAME]. Exceptions to this requirement arise if: (i) the Minister is satisfied that there is no [NAME]; (ii) 60 days have elapsed after the death of the [NAME] and the [NAME] has not applied for the death benefit; or (iii) the amount of the death benefit is below a prescribed amount. [ 26 ] The existence of any one of the above three exceptions is enough to trigger the Minister’s discretionary power to potentially award the death benefit to someone other than the [NAME]. In this case, there’s no question that the [NAME] failed to apply until well after the 60-day timeline had elapsed — hence the Minister’s freedom to consider parties other than the [NAME]. [ 27 ] Section 64(1) of the [NAME] sets out a list of alternative recipients, but nothing in it prevents the Minister from granting the death benefit to the [NAME]’s [NAME] anyway. As the Federal Court of Appeal held in [NAME] , the obligation to pay the death benefit to a [NAME]’s [NAME] does not necessarily end because the 60-day timeline has passed or another party has submitted a competing application. Put another way, an [NAME] is not barred from getting the death benefit just because 60 days have passed. [NAME] was not responsible for the funeral when she applied [ 28 ] The [NAME] argues that it should get the death benefit because it ended up paying for the funeral. The available evidence indicates that it did. [ 29 ] The file contains a statement of account, addressed to [NAME], from [NAME] in the amount of $10,097. Footnote 8 When [NAME] applied for the death benefit in November 2023, she enclosed that statement. Service Canada relied on it to find that [NAME] was, in accordance with section 64(1)(a) of the [NAME], the individual who “is responsible for the payment of the [NAME]’s funeral expenses.” [ 30 ] The section’s use of the present tense verb “is” suggests that the responsibility for payment must exist at the time of application . However, there is evidence that, at the time of her application, [NAME] no longer had responsibility for J. K.’s funeral expenses. By that time, the [NAME] had taken the responsibility off her hands by paying the funeral bill. [ 31 ] It’s important to keep in mind that the [NAME] came into existence the moment J. K. died and was active even before it acquired a court-appointed administrator in January 2024. A statement from [NAME] shows that $10,097 was transferred from the late J. K.’s account to [NAME] in January 2023. Footnote 9 An accompanying email from a [NAME] representative confirmed that the “funeral was paid from the [NAME] account on Jan. 4/23 after we deposited the deferred gain cheque on Jan. 3/23 $14,475.” Footnote 10 [ 32 ] In her testimony, [NAME] confirmed that the [NAME] paid [NAME]. She testified that, after J. [NAME].’s death, [NAME] gave her limited access to his account — she couldn’t withdraw cash from it, but she was allowed to pay bills from it. She said that [NAME] gave her these privileges without asking for a will or any other documentation showing that she was authorized to act on the [NAME]’s behalf. [ 33 ] [NAME] emphasized that, even though she knew there was almost nothing in J. K.’s account when he died, she still voluntarily assumed responsibility for his funeral bill. However, [NAME] also admitted that she never actually paid the bill. She said that, even though [NAME] addressed its statement to her, the [NAME] ultimately paid the outstanding balance. The money, she explained, came out the [NAME]’s account after her brother deposited a large sum in payment for farmland that he had been renting from J. K. She authorized [NAME] to pay [NAME] bill out of the account. [ 34 ] [NAME] said that, while she may not have paid for the funeral, she did pay for other expenses associated with the funeral, including lunch and flowers costing more than $400. She said that she also put $1,000 down as a deposit for J. K.’s grave marker, although it still hasn’t been erected yet. [ 35 ] I find that, because the [NAME] had already paid for the funeral, [NAME] was not responsible for it at the time of her application. According to her own account (although unsupported by any receipts or other documentary evidence), she paid a significant sum for flowers, food, and a marker, but those items do not by themselves qualify as a funeral, which at minimum includes an interment and some kind of service. Instead, it was the [NAME] that paid for those things, which, along with associated fees, cost many more times than what [NAME] contributed. [ 36 ] When Service Canada received [NAME]’s application in November 2023, it should have made at least some basic inquiries to determine whether she was indeed “responsible” for J. K.’s funeral expenses. I am aware that Service Canada operates under an imperative to disburse benefits without undue delay. But even so, after receiving [NAME]’s application, it would not have been difficult to ask her these simple questions: You were billed for the funeral a year ago, but did you actually pay for it? If you didn’t pay for it, who did? Relying entirely on the presence of [NAME]’s name atop [NAME] statement, Service Canada ignored the possibility that another entity — the one that actually paid for the funeral — was more deserving of the benefit. [ 37 ] By all appearances, the Minister favoured [NAME] merely because her application happened to arrive before the [NAME]. In my view, the rules governing the death benefit should not be interpreted to mean “first come, first served.” Conclusion [ 38 ] The Minister did not use her discretion to assess the [NAME] death benefit claim in a judicial manner. My own assessment of the record satisfies me that since [NAME]. [NAME].’s [NAME] paid for his funeral, it is properly owed the [NAME] death benefit under section 71(2) of the [NAME] and section 64(1) of the [NAME]. [ 39 ] The appeal is allowed. Footnotes Footnote 1 [NAME] claimed that she had originally submitted a death benefit application in November 2022, shortly after [COUNSEL]. [COUNSEL].‘s death. At the hearing, the Minister‘s representative said that Service Canada had no record of such an application. Return to footnote 1 referrer Footnote 2 [NAME]’s application for the [NAME] death benefit dated November 20, 2023, GD2-19. Return to footnote 2 referrer Footnote 3 See the [NAME] application for the [NAME] death benefit dated January 10, 2024, GD2-4. Return to footnote 3 referrer Footnote 4 See letters of administration dated October 30, 2023, issued by Saskatchewan’s Court of King’s Bench, GD2-8. Return to footnote 4 referrer Footnote 5 [NAME]  v  Canada ([NAME] ), 2002  FCA  514. Return to footnote 5 referrer Footnote 6 Canada ([NAME] [NAME])  v  [NAME] , 2008  FCA  388. Return to footnote 6 referrer Footnote 7 Canada ([NAME] [NAME])  v  [NAME] , [1996] 1 FCR 644. Return to footnote 7 referrer Footnote 8 See statement of account dated November 21, 2022, issued by [NAME] and [COMPANY], GD2-15. Return to footnote 8 referrer Footnote 9 See redacted statement from [NAME] for the period October 1, 2022 to July 18, 2024, GD2-13. Return to footnote 9 referrer Footnote 10 See email dated July 10, 2024 from [NAME], [COMPANY], [NAME], [NAME]. Return to footnote 10 referrer