Tag: duty to account

15 Jan

Is Acting as an Estate Trustee a Good Idea?

Kira Domratchev Estate & Trust, Estate Planning, Executors and Trustees, Trustees, Uncategorized, Wills Tags: , , , , , 0 Comments

If someone asks you to act as their Estate Trustee, or you learn to your surprise that you are named as an Estate Trustee after the person’s passing, there are a number of things that you should consider before accepting such a responsibility. Given the significant duties involved in such a role, it is important to be aware of the potential for personal liability.

An Estate Trustee’s Legal Duties

An Estate Trustee is a fiduciary and, as such, s/he owes a duty to exercise the care, diligence and skill that a person of ordinary prudence would exercise in dealing with the property of the Deceased.

Furthermore, an Estate Trustee owes a “duty of loyalty”, which has been described as the duty to act honestly and in good faith, and to use powers solely for the purposes for which they were granted (see Oosterhoff on Trusts: Text, Commentary and Materials, 8th ed.). The “duty of loyalty” means that:

(a) An Estate Trustee must exercise powers and perform duties solely in the interest of the Estate.

(b) An Estate Trustee must not knowingly permit a situation to arise where:

(i) The Estate Trustee’s personal interest conflicts in any way with the exercise of powers or performance of duties; or

(ii) The Estate Trustee derives a personal benefit or a benefit to a third party, except as far as the law or the Will expressly permit.

Additional legal duties of an Estate Trustee are:

  • The “prudent investor” rule which ensures that the Estate Trustee properly invests the Estate assets;
  • The “even-hand” rule which ensures that the Estate Trustee acts impartially among all the beneficiaries;
  • The “duty of transparency” which ensures that the Estate Trustee provides information to the beneficiaries; and
  • The “duty to account”.

Some Practical Considerations

From a practical stand point it is also prudent to consider the overall complexity of the Estate and what type and quantity of work will be expected from you in your role as an Estate Trustee. Certainly, some Estate Trustees can be compensated for the work they perform; however, there is a limit to what one may claim and it largely depends on the circumstances.

There are certain tasks that an Estate Trustee may want to delegate to third parties; however, there is a limit as to what type of work may be delegated and what is considered reasonable.

You should consider whether the Will properly sets out the powers as well as the responsibilities of the Estate Trustee which will aid you in the future, should any of your decisions be challenged. Another useful consideration is whether there are any third parties, or specifically, any beneficiaries who may be difficult to deal with in your role as an Estate Trustee, or may want to challenge your authority in the future.

In making the decision whether or not to act as an Estate Trustee, it may also be a good idea to speak to a lawyer regarding whether taking on this role may present an unacceptable legal risk for you in the future.

Thanks for reading.

Kira Domratchev

Find this blog interesting? Please consider these other related posts:

The Difference Between Powers and Duties of an Estate Trustee

Estate Trustees’ Standard of Care

Estate Trustee Duties

23 Sep

Fiduciary Accounting – Hull on Estates #129

Hull & Hull LLP Hull on Estates, Hull on Estates, Podcasts, PODCASTS / TRANSCRIBED, Show Notes, Show Notes Tags: , , , , , , , , , , , , , 0 Comments

 

Listen to Fiduciary Accounting

This week on Hull on Estates, Ian Hull and Suzana Popovic-Montag discuss fiduciary accounting. Who is a fiduciary and what is a fiduciary’s duty to account? They cite several cases that illustrate  fiduciary accounting rules:

  • Re Taerk, [1975] O.R. 482 (C.A.).
  • Re Silver Estate, (1999) 31 E.T.R. (2nd) 256.
  • Roger Estate v. Leung, [2001] O.J. No. 2171.
  • Fair v. Campbell Estate, 2002 3 E.T.R. 3rd 67, Langdon J.
  • Fareed v. Wood, 2005 WL 1460361 (Ont. S.C.J.).
  • McAllister Estate v. Hudgin, 2008 CanLII 42213 (ON S.C.)

Comments? Send us an email at hull.lawyers@gmail.com, call us on the comment line at 206-350-6636, or leave us a comment on the Hull on Estates blog.

 

READ MORE

19 Feb

Accounting Procedure Available Under the Substitute Decisions Act – Hull on Estates #98

Hull & Hull LLP Capacity, Hull on Estates, Litigation, Passing of Accounts, Podcasts Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , 0 Comments

Listen to Accounting Procedure Available Under the Substitution Decisions Act.

This week on Hull on Estates, Rick and David discuss procedure under the Substitution Decisions Act and review executor and attorney obligations as well as specific procedures permitting someone to compel an accounting.

Comments? Send us an email at hull.lawyers@gmail.com, call us on the comment line at 206-350-6636, or leave us a comment on the Hull on Estates blog.

READ MORE

SUBSCRIBE TO OUR BLOG

Enter your email address to subscribe to this blog and receive notifications of new posts by email.
 

CONNECT WITH US

CATEGORIES

ARCHIVES

TWITTER WIDGET