October 8, 2013

While administering an estate, one of the most difficult challenges an estate trustee can face is the situation where a beneficiary continues to reside in a property that is an estate asset when the estate trustee wishes to list the property for sale.  When there is disagreement on this issue amongst co-estate trustees, an estate trustee often seeks direction from the court.

In a recent case, the deceased’s estate remained unadministered for five years following his death. The deceased had appointed his four children as co-estate trustees in his will.  The will provided for an outright distribution and for his four children share his estate equally.

However, the four siblings were unable to agree on how to administer the estate.  Foremost, they could not agree to sell the deceased’s house, a major asset of the estate.  A year after his death, one the deceased’s daughters (“Anna”) moved into the house belonging to the estate.  Anna was also a co-trustee but refused to list the house for sale while living there without paying rent.  Anna did pay other related house expenses.

After four years, her brother and fellow co-trustee (“Onofrio”) brought an application for directions from the court in respect of listing the property for sale.  The parties obtained directions from the court setting out the listing arrangements including the real estate agent they would be using.  However, the real estate agent encountered a number of problems once the property was listed.  Anna interfered during showings, did not return his messages and kept the house in poor condition.  Despite these setbacks, there were several offers made on the property that Anna refused to sign back.

The discord between the siblings revealed itself in their respective positions.  Justice Greer noted that Anna’s affidavit used “inflammatory and untruthful words” about Onofrio.  Another sister tried to support Anna which conflicted with her role as an estate trustee.

The court ordered that Anna vacate the house within 30 days.  This was done to ensure that she did not interfere with the efforts of the real estate agent.  The court went on to remove Anna as an estate trustee.  The court found that her intense dislike for her brothers was evident from her affidavit and she would be unable to work with them as co-estate trustees.  Overall since Anna had put her own interests before the interests of the beneficiaries, she could not continue as estate trustee.

Thanks for reading.