The Cost of Being an Uncooperative Beneficiary

May 4, 2017 David Freedman Executors and Trustees, Litigation, Passing of Accounts, Trustees 0 Comments

As those practising law in relation to the administration of estates well know, beneficiaries may make life complicated for Estate Trustees. Moreover, there are costs that may accumulate where the Estate Trustee must seek the assistance of the Court.

In the recent case of Re Larwill Estate, 2017 ONSC 2688 (Ont. S.C.J.), an Order had been secured to allow the Estate Trustee (daughter of the deceased) to transfer real estate to two beneficiaries in common (her two brothers). If the brothers did not cooperate in the transfer, she was directed to apply for Partition and Sale. One brother cooperated, the other did not. The matter was brought back into Court and the Estate Trustee was directed to commence the partition proceeding. Justice Corthorn commented, “[n]o doubt the loss of their father is difficult for each of… [the three children of the deceased].  The administration of an estate is not a pleasant task… failure to co-operate is only serving to increase the difficulties for… [the uncooperative brother] and his siblings and to make the tasks with which… [the Estate Trustee] is faced even more unpleasant than they otherwise would be.  I hope that… [the uncooperative brother]  will find it in himself to co-operate with his siblings from this point forward.” Costs will inevitably follow against the beneficiary who causes the Estate Trustee to seek the assistance of the Court as was the case earlier in the administration of the Estate.

Estate Trustees should be aware of the ability of the Court to assist in the face of active or passive obstruction by beneficiaries. Indeed, to my mind, it is often cheaper and more efficient to bring matters into Court promptly rather than having to engage in extensive correspondence with beneficiaries or delay the administration of the Estate unduly. In the Larwill Estate case, Justice Corthorn dealt respectfully and firmly with the parties in a manner that will surely ease the burden of administration.

Have a nice day everyone.

David

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