Today’s blog post was written by articling student Iryna Huk.
On appeal, the court in James Estate (Re), 2024 ONCA 623 (CanLII) affirmed that the Superior Court of Justice has inherent jurisdiction to deny an application to appoint an estate trustee, even if the appointment is supported by the beneficiaries.[1] While courts generally defer to a testator’s choice of trustee, courts will not do so if the appointment would risk undermining public confidence in the administration of justice.
In the case at hand, the judge found the appellant unsuitable and ultimately denied the appointment, despite the beneficiaries’ support, based on the appellant’s disbarment, his role in preparing the will, and the surrounding circumstances,
The reasoning behind the decision stems from section 5 of the Trustee Act, R.S.O. 1990, c. T.23, under which the court may appoint or replace trustees, and it also has inherent jurisdiction to remove or refuse to appoint a trustee when necessary. The court emphasized that it would be inconsistent to allow the removal of a trustee but not the prevention of an unsuitable appointment.[2] Courts are not limited to a purely procedural approach and will exercise their jurisdiction to adopt a principled stance when necessary to preserve the integrity of the estate administration process and maintain public confidence in the justice system. [3]
What Makes Someone “Unsuitable”?
It is important to note that in the case above, the court emphasized that being disbarred does not, in and of itself, prevent the appellant from acting as an estate trustee. It was the combination of all the evidence and the surrounding circumstances of the appointment that raised serious concerns about his integrity and clearly demonstrated that this disbarred lawyer was unfit for the role.
The court emphasizes that integrity and public confidence in the justice system is paramount. Here, appointing the applicant as estate trustee would risk undermining that confidence.[4]
Building on that principle, when courts are asked to approve an application for an estate trustee, they assess various factors that could affect the applicant’s suitability. One significant consideration is the presence of a conflict of interest. If the proposed trustee stands to benefit personally in a way that could compromise their impartial administration of the estate, the court may determine that they are unsuitable for the role. For example, in Lagrandeur Estate (Re), 2021 ONSC 3447 (CanLII), the court considered the estate of a woman who died while separated from her spouse, Gaetan.[5] At the time of her death, divorce proceedings were ongoing, including unresolved issues of custody, child and spousal support, and property division. Gaetan, the moving party, sought appointment as estate trustee under a 2004 will, that named him sole beneficiary. [6] The court found Gaetan to be in a clear conflict of interest, as the estate would need to pursue claims against him for unpaid child support and equalization of property. His personal interests were irreconcilable with those of the estate, and the court denied his appointment. [7]
What this means for you?
It’s important to choose your executor wisely. Trustworthiness, integrity, and impartial judgment are essential qualities in an executor, particularly in the eyes of the court. Given the significant power an executor holds over the estate, the role must be carried out objectively and in good faith, with a commitment to fulfilling the testator’s wishes and not their own personal interests. To avoid conflict and ease the burden on your executor and beneficiaries, it’s critical to clearly document your intentions and keep your will up to date.
[1] James Estate (Re), 2024 ONCA 623 (CanLII) [James Estate]
[2] James Estate, at para. 34.
[3] James Estate, at paras. 31-37.
[4] James Estate, at paras. 51, 55.
[5] Lagrandeur Estate (Re), 2021 ONSC 3447 (CanLII) [Lagrandeur Estate]
