Tag: fiduciary

01 Jul

Delegation in Investment Accounts – Hull on Estate and Succession Planning Podcast #119

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Listen to Delegation in Investment Accounts

 

This week on Hull on Estate and Succession Planning, Ian and Suzana discuss delegation issues that arise when dealing with Investment Accounts and address a listeners question about the family cottage.

 

Comments? Send us an email at hullandhull@gmail.com, call us on the comment line at 206-457-1985, or leave us a comment on the Hull on Estate and Succession Planning blog.

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24 Jun

The Investment Accounts – Hull on Estates and Succession Planning Podcast #118

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Listen to The Investment Accounts.

 

This week on Hull on Estates and Succession Planning, Ian and Suzana conduct a quick lesson on capital encroachment and discuss the role of investment accounts in the passing of accounts.

 

Comments? Send us an email at hullandhull@gmail.com, call us on the comment line at 206-457-1985, or leave us a comment on the Hull on Estate and Succession Planning blog.

17 Jun

Becoming an Executor after Death – Hull on Estates #115

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Listen to becoming an executor after death.

This week on Hull on Estates, Ian Hull and Suzana Popovic-Montag, discuss becoming an executor after death and three issues that must be addressed immediately.

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.

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19 Feb

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

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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.

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08 Nov

Taking Charge of Estate Assets

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In Monday’s blog, I noted the increasing prevalence of new on-line businesses serving to assist estate trustees with the location of estate assets.  Of course, locating the asset is just the first step.  The estate trustee has to then manage the asset.  In most instances this involves liquidating the asset or distributing it in specie to the beneficiaries depending on the testator’s intention.

Shares held by a deceased in a private company present a particular challenge to an estate trustee.  Should they be sold or should the estate trustee participate in the business as a going concern?.  This quandry, if the will gives no guidance, is compounded when the deceased holds the majority of shares and leaves a controlling interest in such a corporation.

While not always a simple question to answer, in such circumstances it seems self-evident (and just makes good business sense) for the estate trustee to be a director of the company. In such capacity, the executor is positioned to watch over the management of the business and protect this asset of the estate.  The issue was addressed in an oft-quoted excerpt from Lucking’s Will Trusts (Re) (1967) All E.R. 726, where the Court states:

“Now what steps, if any, does a reasonably prudent man who finds himself a majority shareholder in a private company take with regard to the management of the company’s affairs? He does not, I think, content himself with such information as to the management of the company’s affairs as he is entitled to as a shareholder, but ensures that he is represented on the board.”

Have a great day,

David 

 

 

02 Apr

Breach of Trust – Civil, Criminal or Both?

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MacLeans magazine’s Mark Steyn is providing an acerbic day-by-day report on the trial of newspaper magnate Conrad Black in Chicago. The trial continues a pattern by the US government to lay criminal charges in cases of alleged corporate malfeasance more vigorously following the Enron scandal.

As the historic intergenerational wealth transfer currently underway gathers steam, a well-publicised case could easily drive greater government interest in prosecuting breach of trust accusations just as Enron did in the corporate realm. Virtually all lawyers practising in the area have seen serious misappropriation of property or abuse of the vulnerable by those in a position of trust. Is this criminal? If so, will the police and crown attorneys be willing to treat it as such?

The Canadian Criminal Code certainly indicates so: it includes provisions dealing with Theft by person required to account (section 330); Theft by person holding a power of attorney (section 331); Misappropriation of money held under a direction (section 332); Criminal breach of trust (section 336); Fraud (section 380); and Assaults (sections 264 to 266). These provisions could be invoked given the right circumstances in an Estate, elder abuse or capacity case.

The Police often perceive misappropriation by fiduciaries as a civil matter. On the other hand, they are increasingly aware of elder abuse or abuse of the incapable, and far more willing to intervene.

As high-profile cases involving misappropriation of funds or abuse of incapable persons receive greater media attention, look for the legal consequences to branch out from the civil context to involve criminal charges as well.

Thanks for reading.

Sean Graham

17 Jul

BREACH OF FIDUCIARY DUTY BY THE WILL MAKER – EXECUTOR AND TRUSTEE’S ROLE – EVIDENTARY ISSUES – WHAT TO DO ABOUT ABUSE CLAIMS? – PART V

Suzana Popovic-Montag Ethical Issues, Litigation Tags: , , , , , , , , 0 Comments

In almost every case, the majority of the evidence will come from the allegedly abused child and, as such, the strength of that evidence can be problematic. In these types of situations, one must not forget the requirement of corroborative evidence pursuant to section 13 of the Estates Act R.S.O. 1990, c. E.23, which provides that:

13. In an action by or against the heirs, next-of-kin, executors, administrators or assigns of a deceased person, an opposite or interested party shall not obtain a verdict, judgment or decision on his or her own evidence in respect of any matter occurring before the death of the deceased person, unless such evidence is corroborated by some other material evidence.

See also Schnurr B.A., "Estate Litigation – Requirement of Corroboration", 5 E.T.Q. 42.

Due to the evidentiary difficulties of these types of claims, one of the first steps that a claimant should consider taking is to obtain an expert’s opinion.

The expert’s opinion should contain evidence for the Court to consider with respect to such things as the recollections of the claimant, the details of abuse over the years and the results of both the mental and physical ramifications of that abuse.

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13 Jul

BREACH OF FIDUCIARY DUTY BY THE WILL MAKER – EXECUTOR AND TRUSTEE’S ROLE – LIMITATION ISSUES? – Part IV

Suzana Popovic-Montag Ethical Issues, Wills Tags: , , , , , , 0 Comments

As to the question of fiduciary duty between parent and child, the Supreme Court of Canada in M.(K.) v. M.(H.) held that the relationship of parent and child is fiduciary in nature and that incest was a breach of the parent’s fiduciary duty to protect the child’s well being and health.

Limitation Periods

It is perhaps the most compelling defence available to counsel defending a parent in such cases that the claim has been brought outside of the conventionally recognized limitation periods.

A significant portion of the decision in M.(K.) v. M.(H.) was devoted to the question of the limitation defences raised by the parent.

In contrast, counsel for the child argued that incest was a separate and distinct tort which was not subject to any limitation period; that incest constituted a breach of fiduciary duty by a parent and is not subject to any limitation period; and if a limitation period applies, the cause of action does not accrue until it is reasonably discoverable. Furthermore, it was argued that the child was of unsound mind pursuant to section 47 of the Limitations Act; that the tort is continuous in nature and the limitation period does not begin to run until the child is no longer subjected to parental authority and conditioning; and that the equitable doctrine of fraudulent concealment operates to postpone the limitation period.

The limitation defence failed and the Supreme Court of Canada held that the tort claim, although subject to limitations legislation, does not accrue until the child is reasonably capable of discovering the wrongful nature of the parent’s acts and the nexus between those acts and her injuries. Furthermore, that the discovery took place only when the child entered therapy and the lawsuit was commenced promptly thereafter.

All the best, Suzana and Ian. ——–

12 Jul

BREACH OF FIDUCIARY DUTY BY THE WILL MAKER – EXECUTOR AND TRUSTEE’S ROLE – WHAT TO DO ABOUT ABUSE CLAIMS? – PART III

Suzana Popovic-Montag Ethical Issues Tags: , , , , , , , 0 Comments

As is sometimes the case, an unequal distribution of an estate as between children can arise from a testator who has had a long history of mental illness, chronic alcoholism or other such personal reasons, which may affect the testator’s state of mind over a period of many years.

For example, if a child who has been treated unequally grew up in a home where he or she suffered through instances of physical violence, as between the parents and him or herself, this may be the type of fact situation to consider when looking to pursue a claim for breach of fiduciary duty of parental obligations. Similarly, if the unequally treated child lived in a home that was constantly in turmoil, as a result of a chronically alcoholic parent, this situation should also be considered in the context of the fiduciary obligations of a parent.

In our view, one must find several compelling supporting facts to bolster any claim of breach of fiduciary duty or breach of parental obligation. Such facts should also be combined with a clear and identifiable estrangement as between parent and child.

Parental Obligations

In the decision of M. (K.) v. M. (H), the Supreme Court of Canada considered the whole concept of what is meant by the term "parental obligation".

The Court considered this issue in the context of a particularly gruesome and egregious set of facts.

In M.(K.) v. M.(H.), the Supreme Court of Canada examined the parent-child relationship in the circumstances of long-standing allegations of incest and abuse by a parent to a child.

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10 Jul

BREACH OF FIDUCIARY DUTY BY THE WILL MAKER – EXECUTOR AND TRUSTEE’S ROLE – WHAT TO DO ABOUT ABUSE CLAIMS? – PART I

Suzana Popovic-Montag Litigation, Wills Tags: , , , , , , 0 Comments
While the law surrounding the breach of fiduciary duty has evolved in many ways over the years, it may be that its current application to estate litigation should be revisited.
The conventional situation where an attorney, a personal representative or a trustee is in a fiduciary position and then uses his or her power in a way that would constitute a breach of that position, has been seen as a fundamental breach of fiduciary duty: see M.(K.) v. M.(H.) (1992), 96 D.L.R. (4th) 289 (S.C.C.).
In M.(K) v. M(H), a unique twist to the conventional "breach of fiduciary duty" was considered by the Supreme Court of Canada in the context of the fiduciary duties of a parent.
It appears that there is now clear authority for the proposition that a parent is in a fiduciary relationship with his or her child. Furthermore, where there are abusive actions on the part of the parent against the child, this conduct may cause the Court to hold that a breach of fiduciary duty has occurred and thereby damages may be awarded against the parent. See also Cullity, M.C. "Personal Liability of Trustees and Right of Indemnification", 16 E.T.J. 115.
Ian has published an article on this topic in the Estates and Trusts Reports entitled, "A New Twist on Breach of Fiduciary Duty in Estate Litigation" (Carswell, 1999). As such, we propose to undertake a careful review of this unique yet important aspect of fiduciary duties.
All the best, Suzana and Ian.

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