Quitting As Estate Trustee: Not Always Easy

July 19, 2019 Paul Emile Trudelle Estate & Trust, Estate Litigation, Estate Planning, Trustees, Wills 0 Comments

Often, estate trustees no longer want the job, and want to be removed. This is particularly the case when they are required to deal with difficult beneficiaries. In most cases, where a Certificate of Appointment has been issued or where they have acted as estate trustee in any way, a court order is required. However, as illustrated in Pierce v. Zock, 2019 ONSC 4156, getting an order removing oneself as estate trustee is not always straightforward.

There, the deceased appointed two of his children, Gary and Norma, as estate trustees. The wills, primary and secondary, established a trust for the benefit of another child, Stephen. The relationship between Gary and Norma on the one part, and Stephen on the other broke down. Gary and Norma brought an application to remove themselves as estate trustees.

Under the trusts established by the wills, Stephen was entitled to remain in the deceased’s real property as long as he was capable of maintaining the property and managing his personal care. If these conditions were not met, the property was to be sold and the proceeds divided amongst the deceased’s four children, with Stephen’s share being held in a trust administered by the estate trustees. The estate trustees also sought directions from the court as to whether these conditions were being met, and if not, whether the real property could be sold.

The court noted that a trustee cannot be forced to continue to serve as a trustee if he or she is  no longer willing or able to continue. However, in this case, the estate trustees were not able to suggest an alternate to act as estate trustee. No institutional trustee or individual was willing to act. Further , the Public Guardian and Trustee was not willing to act.

During oral argument, Gary indicated a willingness to continue to act on a short term basis, if the court allowed the sale of the real property. The court seized upon this reluctant willingness, and ordered that Norma be removed, but that Gary stay on as estate trustee. The court imposed conditions, which included that Stephen shall have no contact with Gary except through legal counsel.

On the question of the sale of the property, the court refused to allow the sale. The court found that there was insufficient evidence that Stephen was not maintaining the property or was incapable of managing his personal care.

In conclusion, Gary was kept on as estate trustee and was not permitted to resign. The property was not to be sold.

Such a possible outcome should be kept in mind when accepting an appointment as estate trustee. Further, testators should consider naming alternate estate trustees in event that the appointed estate trustees are not able or willing to continue in the role.

Have a great weekend.
Paul Trudelle

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