The right of a trustee to seek the opinion, advice or direction from the court in relation to its obligations is a well-established principle of equity.
It has been codified in S. 86 of the Trustee Act RSBC.
S.86 (1) states: “ a trustee, executor or administrator may, without commencing any other proceeding, apply by petition to the court, or by summons on a written statement to a Supreme Court judge in chambers, for the opinion, advice or direction of the court on the question respecting the management or administration of the trust property or the assets of the will maker, or intestate.”.
Jones v McLeod 2017 BCSC 1478 outlined the scope of the questions which may be asked of the court in an application under S.86(1) of the Trustee act.
That judgment specifically referred to Philip K. Matkin Professional Corp. v . Northmont Resort Properties LTD 2013 BC SC 2071, (reversed on other grounds, 2014 BCCA 227):
“The seeking of legal advice on legal issues arising in connection with the trustees obligations is an appropriate category of application under S.86 of the Trustee Act.
On an application for directions under S. 86 of the trustee act, the court should not exercise the trustee’s powers, but rather confine itself to advice on any given legal issues that arise in connection with the trustees obligations.
Accordingly, the authorities state that an executor or trustee may seek the advice, opinion, or directions of the court a legal question and then act on that advice.
While hearing such an application for directions, the court may have to make some findings of fact in order to provide its opinion or directions on a legal question put to it. A petition proceeding is not suitable for the determination of contested issues of fact on questions relating to the trustees liability.
The duty imposed on the trustee is to maintain and preserve the asset. There is a correlative right in the beneficiary to a maintained and preserved asset.
The court state that the first step in applying this principle is to define the asset. The greater the precision in defining the asset, the greater the precision in defining the duty of the trustee and the right of the beneficiary.
