Seeking Court Directions By The Executor/Administrator

Executors often do not know what to do and may be faced with decisions that are difficult to make without Court guidance. Where there is no certainty in the law, and no consensus amongst the beneficiaries affected, the Executor has recourse to the court by way of an application for directions under s. 86 of the Trustee Act.

Chapter 9 of the BC Probate and Estate Administration Practice Manual (CLE, 2nd Ed), gives examples of the court declining to give directions include:

determining what property should be included in the estate;
the time or price of the sale of shares;
the distribution of the estate on an intestacy; and
whether a respondent was the common law spouse of the deceased.
In Re Lohn Estate (1991) 41 E.T.R. 159 (B.C.S.C), the court declined making an order approving a scheme to minimize taxes and subsequently refused to allow the trustees to “unload the responsibility they have assumed, as trustees, upon the court”.

In Re Royal Trust Co. (1962), 39 W.W.R. 638 (B.C.S.C), the court held that its jurisdiction is restricted to questions of “management or administration” and will not determine question of ownership or other matters “affecting the rights of the parties”.

Examples of situations in which the court did give advice and directions include:

the proper disposition of interest earned on a hold back for taxes;
the extent of a discretion or power;
determining the beneficiary under an RRSP where there was a general revocation clause in the will;
approving a resettlement of a trust;
whether terms of a will were against public policy;
whether a trust was charitable;
whether the doctrine of acceleration applied in a disclaimer situation; and
where trustees cannot reach a unanimous decision.


Recommended Posts