An estate trustee is entitled to compensation for work performed in that capacity on behalf of an estate. Subject to any fee or compensation agreement, the general rule in Ontario is that an estate trustee is entitled to compensation in the amounts of 2.5% of all capital receipts and disbursements, and 2.5% of all revenue receipts and disbursements. These figures are generally described as roughly 5% of the estate. An estate trustee is also entitled to two-fifths of 1% of the average annual value of the assets, as a care and management fee.
However, an estate trustee may be entitled to an additional special fee in the event that extra or specialized work is required. Some examples include, but are not limited to, tax issues, complex assets and litigation by or against the estate. Again, any fee or compensation agreement may impact whether the estate trustee is entitled to a special fee and if so, at what rate.
Although the taking of a special fee has been recognized in case law such as in the case of Bluestein Estate v. Bluestein (2000), 2000 CarswellOnt 1054 (Ont. S.C.J.)) (“Bluestein”), it is important that an estate trustee keep track of their time and the work performed, with sufficient detail, in order to ultimately justify the taking of the fee to the beneficiaries or to the court, as the case may be. In Bluestein, the court stated that the estate trustee must establish that the special work performed was outside the “average” estate, such that the estate trustee would not be compensated adequately for all the work required to be done.
Special fees, like the ordinary compensation an estate trustee is entitled to, would be subject to scrutiny by the beneficiaries of an estate on an application by the estate trustee to pass his or her accounts.
