Estate Trustee Removal
The recent decision in Bunn v. Gordon demonstrates how a breakdown in the relationship between an estate trustee and beneficiary may lead to the removal of the estate trustee.
The Testator made a Will naming his girlfriend of three and a half years as estate trustee. The Will, amongst other things, leaves real property and a portion of the residue to his two children to be held in trust by the estate trustee until attaining the age of 21. As a result of the age of the children, the estate trustee’s office will last until at least the year 2021.
From the outset, the administration of the estate was contentious, such that the children commenced an application under s 37(1) of the Trustee Act for the removal and replacement of the estate trustee. The law with respect to estate trustee removal has remained relatively consistent with the governing principle being the welfare of the beneficiaries and whether the continuance in office of an estate trustee will likely prevent the estate from being administered. From this the courts do not take lightly the wishes of the deceased as expressed in the Will.
The children raised four examples in support of their application to remove the estate trustee:
- failing to provide the children with a copy of the death certificate, despite multiple requests;
- failing to account for a Kodiak trailer demonstrating a lack of care with the estate assets;
- selling a desk and cupboard which was of sentimental value to the children, showing a disregard for the interests and wellbeing of the beneficiaries; and
- failing to report on the sale of real property.
Individually, the evidence in and of itself was not sufficient to call for the removal of the estate trustee. However, the court held that collectively the relationship between the estate trustee and children had broken down and that the antipathy towards the beneficiaries precluded the dutiful administration of the estate. Although the behaviour was not solely the fault of the estate trustee, the court indicated that it is the estate trustee who owes the fiduciary obligation. Therefore, the estate trustee was removed.