The Role of Executors and Trustees

Articles

Estate litigation issues in the context of an executor or trustee include court applications addressing the actions of the executor or trustee, as well as court applications which are brought or responded to by the executor or trustee.

In terms of the actions of the executor or trustee, the courts are generally reluctant to interfere with the administration of a private estate or trust and will not remove an executor or trustee unless it is in the best interests of the beneficiaries and the estate or trust to do so. The court will give considerable weight to the testator or settlor’s express wishes regarding the appointment of executors and trustees, but this will be balanced against any evidence of a breach of trust, conflict of interest, or disagreement or dissension between co-executors or co-trustees which establishes that the interests of the beneficiaries and the administration of the estate or trust may be endangered.

The roles of an executor appointed under a will, an administrator appointed by the court, and a trustee under a trust have all been treated by the courts as practically indistinguishable. All executors, administrators and trustees are fiduciaries, which means that they are required to act in the best interests of the estate or trust and the beneficiaries, cannot profit from their role unless permitted by statute, the testamentary document, or the trust instrument, and cannot delegate certain powers or decision making to anyone else. The standard of care for an executor or trustee, whether professional or not, is the standard of a prudent person of discretion and intelligence acting in his or her own affairs.

Executors and trustees have a general duty to put their own interests aside and to act exclusively for the benefit of the estate or trust. If an executor or trustee acts in a way that is contrary to their duties, then he or she may be in a conflict of interest, and either the beneficiaries or a co-executor or cotrustee may apply to court to have that executor or trustee removed. In some cases, the courts have removed an executor or trustee where there has been a potential conflict of interest or potential breach of trust.

Another situation which may require application to court is where a serious conflict or a situation of deadlock arises between co-executors or co-trustees. The courts have removed executors and trustees where there has been widespread misunderstanding and bitterness resulting in an inability to agree on policies to efficiently manage the estate or trust in question. Since executors and trustees must be nanimous in making decisions relating to the administration of an estate or trust, if one executor or trustee fails to agree with his or her co-executors or co-trustees, that deadlock may require the intervention of the courts to either break the deadlock or remove one or all of the executors or trustees.

In addition to these challenges of the ability of a specific executor or trustee to carry out his or her duties, the executor or trustee can become involved in various court applications which it brings or responds to.

If you believe you require legal assistance with an estate dispute and would like to speak with someone about your concerns please contact Estate & Trust Litigation Practice Group Chair Mark Weintraub at 604.643.3113 or msw@cwilson.com.