In the recent case of Sassano v. Iozzo, 2024 ONSC 1517, the Ontario Superior Court of Justice addressed a dispute between two sisters concerning the administration of their deceased mother’s estate.
Background
Ms. Sassano and Ms. Iozzo are daughters of the Deceased, who passed away in 2011. Their mother left a Will dated 1998, designating both sisters as executors and trustees of her estate. The main asset of the estate was a property in Toronto.
Issues
Ms. Sassano sought the Court’s intervention due to the deteriorating condition of the property and her sister’s refusal to cooperate in its upkeep and potential sale. Despite repeated attempts to involve Ms. Iozzo, she remained unresponsive.
Legal Principles
The Court considered the legal framework for removing or passing over an estate trustee, emphasizing the importance of honoring the testator’s wishes while ensuring the welfare of the beneficiaries and proper administration of the estate.
The Application was correctly brought under Rule 14.05(3) of the Rules of Civil Procedure:
14.05(3) A proceeding may be brought by application … where the relief claimed is,
…
(c) the removal or replacement of one or more executors, administrators or trustees, or the fixing of their compensation.
And the Court is provided the inherent jurisdiction to remove trustees, under s. 37(1) of the Trustee Act:
37(1) The Superior Court of Justice may remove a personal representative upon any ground upon which the court may remove any other trustee, and may appoint some other proper person or persons to act in the place of the executor or administrator so removed.
Evidence
Ms. Sassano provided affidavits detailing the property’s condition, her attempts to contact Ms. Iozzo, and the lack of cooperation from her sister. A real estate agent’s testimony supported Ms. Sassano’s claims.
Analysis
The Court found that Ms. Iozzo’s inaction endangered the estate’s assets, justifying her removal as an estate trustee. Despite the testator’s intent to have both daughters serve, Ms. Iozzo’s refusal to fulfill her duties necessitated her passing over.
The Court found that this case was similar to the decision in Kinnear v. White, 2022 ONSC 2576, where it stated that in Kinnear:
the estate trustee appointed by the will had not taken any steps to administer the estate, including applying for a Certificate of Appointment of Estate Trustee, notwithstanding the urging of the beneficiaries and court orders requiring the disclosure of estate assets and a passing of accounts. The Court held that the failure of the appointed estate trustee to take any steps in the administration of the estate although urged to do so, including the failure to apply for a Certificate of Appointment, supported an order that the estate trustee be passed over.
The Court also relied on Di Michele v. Di Michele, 2014 ONCA 261 where the Court similarly removed an estate trustee where the they has endangered the trust property. Following the reasoning in Di Michele, the Court opined that an estate trustee may be passed over on the same basis.
Conclusion
The Court ordered Ms. Iozzo to be passed over as an estate trustee, appointing Ms. Sassano as the sole executor and trustee. It also granted Ms. Sassano leave to apply for a Certificate of Appointment of Estate Trustee and directed her to seek further directions from the Court as needed.
Costs
Ms. Sassano was awarded costs for the Application, to be paid from Ms. Iozzo’s share of the estate, after the Court considered her “refusal, after ample notice, to engage as an estate trustee under her mother’s Will and her failure to cooperate with the appointed co-estate trustee, in breach of her appointment and to the detriment of the Estate.” This reflected the Court’s recognition of Ms. Sassano efforts to administer the estate properly and Ms. Iozzo’s failure to cooperate.
In summary, Sassano v. Iozzo underscores the importance of fulfilling fiduciary duties in estate administration, balancing the testator’s intentions with the welfare of beneficiaries and the need for efficient estate management.
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