If the estate trustee conducts himself in such a manner that the persons having a financial interest in the estate lose all confidence in him as estate trustee, they may seek to have him removed. Persons considered to have a financial interest include creditors, beneficiaries and, if a will is being challenged, persons who would become beneficiaries of the estate if the will is declared invalid. Generally speaking, the areas of duty where the estate trustee may fall short are in the collection of the assets of the estate, ascertaining and paying creditors and accounting to and pay the beneficiaries. Aside from having the estate trustee removed, litigation could also result in the estate trustee being ordered to do something or refrain from doing something.
One should note that where litigation proceedings are commenced in certain jurisdictions in Ontario, mandatory mediation is effective. This means that the relevant parties are required to attempt to settle the dispute through formal mediation.
One should also bear in mind that litigation against estate trustees does not always result in a negative consequence against the estate trustee; their conduct could be found to be appropriate in which case costs may be awarded against the litigant(s).
In some situations, the person named as estate trustee or who may have a right to act in this capacity where there is no valid will, refuses to accept the role. No one is obligated to act as an estate trustee and they will not attract liability for not doing so unless they have already taken steps in the administration of the estate. In this case, the proceeding would not properly accuse the estate trustee of misconduct but rather seek an order from the Court for steps to be taken that would advance the administration of the estate. Specifically, the proceeding would entail serving the first in line to be appointed as the estate trustee stating a deadline by which they must apply for a Certificate of Appointment of Estate Trustee from the Court, after which, if they do not submit the application, they will be deemed to have renounced the appointment.
One should note that a proceeding launched to force the person who has first priority right to act as the estate trustee to seek the Court appointment assumes that the identities of that individual(s) and the beneficiaries are known. But this may not necessarily be the case. A person who may have a financial interest may not know who is named in the will as estate trustee or whether they are actually named as a beneficiary in the will. In this case, it is possible to seek an order directing a person who is suspected of having a will of the deceased to bring the will to the registrar of the court or wherever else is appropriate. A court may also direct a person, who there are reasonable grounds for believing has knowledge of a will based on sufficient evidence, to attend for questioning in court or otherwise.
If a person does not have information or knowledge of a will but suspects that they may be a beneficiary, they may file a request for notification in Court which gives them the right to receive notice of any application for an appointment as estate trustee when it is filed, as long as that application is filed within three years of the date that the request for notification was filed in Court. Upon expiration of this three-year period, the request for notification can be renewed to extend the time.
If you have concerns about the conduct of interested parties in an estate administration, whether they are beneficiaries, creditors or estate trustees, please contact Andrea P. Kelly for assistance.
*****
Andrea Kelly, Lawyer, has extensive experience in wills, trusts, powers of attorney and estate administration matters. She provides clients with a high standard of timely professionalism and expertise, incorporating a very thorough fact finding process. This is quite often enlightening for her clients and facilitates individually tailored services. If you would like to know more, feel free to use the easy contact form or read Andrea’s bio.