The task of becoming an estate trustee may seem daunting to some. You are responsible for upholding the wishes of the deceased and being accountable to the beneficiaries for every single transaction you complete involving estate assets. Some might fear that if they do not have a background in accounting, they cannot do this job.

The case of Baran v Cranston discusses the standard of record-keeping required of an estate trustee and may provide some relief to those who may find being an estate trustee an impossible task.

This case is an appeal from a Superior Court decision that found the estate trustee to have met both the standard of care in her duty to account and her standard of record-keeping. The appellant appealed on the basis that the estate trustee’s accounting was not perfect and that her compensation should be substantially reduced for this reason.

The Divisional Court found no error in law in the audit judge’s reasoning and therefore, dismissed the appeal.

Rule 74.17 of the Rules of Civil Procedure requires that an estate trustee keep accurate records of the assets and transactions in the estate. The appellant argued that this required a standard of perfection with respect to keeping records and required that all receipts of expenditures be provided. Specifically, the appellant argued that the estate trustee had failed to provide written receipts or documentation for a portion of the expenses and the audit judge erred in upholding these expenditures. Additionally, the appellant argued that the audit judge erred in failing to find that the estate trustee was in breach of trust because she had failed to keep proper records and did not meet her duty to account.

In their analysis, the Divisional Court clarified that the standard of care for an estate trustee is the standard of care of a person of ordinary care and diligence in managing their own affairs. The standard was to exercise “ordinary skill and prudence”. Since the audit judge used this standard, there was no error in the analysis.

Furthermore, the audit judge went through all the objections to the passing of accounts and found that the estate trustee had provided explanations for the absence of receipts that was credible and reliable. The audit judge heard the estate trustee’s testimony first-hand and was in the best position to make a determination of her credibility. Therefore, the Divisional Court upheld the audit judge’s decision to pass the accounts and award compensation to the estate trustee.

This decision emphasizes the importance of record-keeping but also clarifies that the job of an estate trustee is not to be perfect, but to be able to provide reasonable explanations for their transactions.

Thank you for reading.