Category: Removing Executors/Trustees

Trevor Todd and Jackson Todd have over sixty years combined experience in handling contested estates, including the removal of executors.

The law relating to the removal of an executor was summarized in Nand Estate (Re), 2022 BCSC 1718 and followed in Re Walker Estate 2024 BCSC 250.

The Court has power, under both s. 30 of the Trustee Act, R.S.B.C. 1996, c. 464 as well as its own inherent jurisdiction, to make an order removing a trustee: Dirnberger Estate, 2016 BCSC 439 [Dirnberger Estate] at para. 9, citing Morelli v. Morelli, 2014 BCSC 106 at para. 29.

Section 158(3) of the WESA allows the Court to remove a person entitled under a will from being a personal representative in the circumstances enumerated in that section. Subsection 158(3)(f)(iii) allows for removal where the personal representative is:

(iii) otherwise… unable to or unreasonably refuses to carry out the duties of a personal representative,
to an extent that the conduct of the personal representative hampers the efficient administration of the estate

Notwithstanding that jurisdiction, courts are very hesitant to interfere with the discretion of the will-maker to remove an Executor. To do so, good reason must be shown for believing that the interests of a person entitled under the will are in danger: Re: Estate of Andre Jacques Blitz, Deceased, 2000 BCSC 1596 at para. 20.

Indeed, in deciding whether to remove an estate’s trustee, the Court’s main guide should be “the welfare of the beneficiaries”: Crawford v. Jardine, 1997 O.J. No. 5041 (Ont. Ct. (Gen. Div.)) at para. 18.

In Dirnberger Estate, at para. 11, the Court set out the four categories of conduct on an Executor’s part that will warrant removal as follows:
a) endangerment of the trust property;
b) want of honesty;
c) want of proper capacity to execute the duties; and
d) want of feasible fidelity.

In Parker v. Thompson (Trustee) 2014 BCSC 1916, at paras. 35 to 43, the Court added “actual dishonesty” and “lesser basis of a trustee’s ability to act impartially” as bases for removing a trustee.

It also reiterated the removal of a trustee “should not be lightly entertained”, and citing Radford v. Radford Estate, 2008 CarswellOnt 5297, 43 E.T.R. (3d) 74, set out a number of other considerations to apply when considering an application for the removal of a trustee. They are:

• removal must be the only course to follow;
• non-removal must likely prevent the proper execution of the trust; and
• removal is not intended to punish for past conduct.

The existence of friction between a trustee and one or more of the beneficiaries is usually not sufficient, of itself, to justify the removal of the trustee: Dirnberger Estate at para. 10, citing Erlichman v. Erlichman, 2000 BCSC 173 at para. 8.

Re De Bonis 2023 BCSC 713 removed a brother and sister who were jointly appointed co-executors of their parent’s estate, by reason of their inability to work together and their toxic relationship and appointed a corporate trustee in their place.

Removal of Executor

There are three sources of authority that the Court can draw on to remove an executor or trustee and appoint a replacement:

-the Wills, Estates and Succession Act, S.B.C. 2009, c. 13 [WESA],
-the Trustee Act, R.S.B.C. 1996, c. 464,
and the Court’s inherent authority: Morelli v. Morelli, 2014 BCSC 106 at para. 29.

Section 158 of WESA, govern an application to remove or pass over a personal representation and replace them. The relevant portions of s. 158 include:

(3) Subject to the terms of a will, if any, and to subsection (3.1), the court, by order, may remove or pass over a person otherwise entitled to be or to become a personal representative if the court considers that the personal representative or person entitled to become the personal representative should not continue in office or be granted probate or administration, including, without limitation, if the personal representative or person entitled to become the personal representative, as the case may be, …

(f) is
(i) unable to make the decisions necessary to discharge the office of personal representative,
(ii) not responsive, or
(iii) otherwise unwilling or unable to or unreasonably refuses to carry out the duties of a personal representative,
to an extent that the conduct of the personal representative hampers the efficient administration of the estate, or …

Section 159 of WESA provides the Court with the statutory authority to appoint an executor in circumstances where the Court has discharged or removed an executor.

Sections 30 and 31 of the Trustee Act, provides the statutory authority for the Court to remove an individual as trustee of an estate and appoint a replacement. In the application of both WESA and the Trustee Act, the same considerations apply, as provided below.

The Court’s discretion to remove an executor should be guided by the principles listed in Parker v. Thompson (Trustee), 2014 BCSC 1916 at para. 37. The will-maker has the right to choose their executor, and as such their decision is entitled to deference and will only be interfered with if there is clear and cogent evidence to do so. The executor’s acts or omissions must be of such a nature as to endanger the administration of the estate.

The Court’s main consideration is the welfare of the beneficiaries: Parker at para. 37; Burke v. Burke, 2019 BCSC 383 at para. 29. It is not the interests of a particular beneficiary that are to be considered, but rather the benefit of the beneficiaries collectively: Conroy v. Stokes, [1952] 4 D.L.R. 124 at p. 128, 1952 CanLII 227 (B.C.C.A.).

The analysis is contextual and each case will turn on its facts: Burke at para. 43.
In Conroy, the Court of Appeal described the four categories of misconduct by an executor that can warrant their removal:
a) Endangerment of trust property;
b) Want of honesty;
c) Want of proper capacity to execute duties; and
d) Want of reasonable fidelity.
The existence of friction between the executor and one or more beneficiaries is generally, in and of itself, not sufficient to warrant the removal of the executor: Letterstedt v. Broers, (1984), 9 App. Cas. 371 at 389 (South Africa P.C.). However, animosity between those parties, or co-executors, can be relevant to whether it hampers the proper administration of the estate: Dunsdon v. Dunsdon, 2012 BCSC 1274 at para. 202; Levi-Bandel v. McKeen, 2011 BCSC 247 at paras. 21–25. In such circumstances, a finding of wrongdoing is not necessary: Dunsdon at para. 202; Weisstock v. Weisstock, 2019 BCSC 517 at para 44.
In Radford v. Radford Estate (2008), 43 E.T.R. (3d) 74, 2008 CanLII 45548 (O.N.S.C.), Justice Quinn comments that removal is not intended to punish past conduct:
Removal not intended to punish past misconduct
[106] “The authorities are, I believe, consistent in placing the emphasis on the future administration of the estate, and the risks to which it will be exposed if the trustee remains in office. The question is whether the trust estate is likely to be administered properly in accordance with the fiduciary duties of the trustee and with due regard to the interests and welfare of the beneficiaries. The sanction of removal is intended not to punish trustees for past misconduct but rather to protect the assets of the trust and the interests of the beneficiaries”: see St. Joseph’s Health Centre v. Dzwiekowski, supra, at para. 28.
[107] But, “past misconduct that is likely to continue will often be sufficient to justify removal …”: see St. Joseph’s Health Centre v. Dzwiekowski, supra, at para. 29.
[Emphasis added.]

Conflict of Interest

An executor’s conflict of interest may warrant removal. In Hall v. Hall (1983), 45 B.C.L.R. 154, 1983 CanLII 396 (S.C.), Justice Proudfoot held that conflict of interest and a conflict of duty demonstrate want of fidelity: see also Pangalia Estate, 2021 BCSC 1070 at para. 22. Further, in Morelli at para. 30, Justice Harvey held that the “welfare of the beneficiaries of an estate may be endangered if there is a conflict of interest”. However, not all perceived or actual conflicts of interest will give rise to the removal of an executor: Burke at para. 43.
In Ching Estate (Re), 2016 BCSC 1111, an executor was passed over due to perceived unequal treatment and conflict of interest, with Justice Affleck holding that the “perception of a disabling conflict of interest is overwhelming”: at para. 20. The Court held that a “perceived” conflict of interest may lead to removal:

[22] The authorities indicate that even a “perceived” conflict of interest between an executor’s personal interests and her obligation to administer the trusts in the will in the interests of the beneficiaries may cause this court to intervene to appoint a new executor or an administrator to avoid even the appearance of conflict.

Fitzgerald v Hill 2022 BCSC 968 is one of many examples where disgruntled beneficiaries with hostility towards the executor failed in court to replace or remove an executor / trustee.

The court listed off the many things that the executor had performed in carrying out his duties and saw no endangerment to the estate assets so refused to remove an executor.

THE LAW

To replace or remove an executor under ss. 158 and 159 of Wills, Estates and Succession Act, S.B.C. 2009, c. 13 [WESA], and a trustee under s. 30 of the Trustee Act, R.S.B.C. 1996, c. 464. Both may also be removed and replaced under the inherent jurisdiction of the court.

If the court removes a personal representative under WESA, it must appoint another person who consents to act as a substitute personal representative, unless the administration of the Estate is complete or the court considers it unnecessary.

The guiding principles are well-established for the exercise of judicial discretion to remove an executor and trustee. As stated by Butler J., as he then was, in Levi-Bandel v. McKeen, 2011 BCSC 247:

[19] The test for removal of an executrix or trustee is not contentious. The leading authority in British Columbia remains the decision in Conroy v. Stokes, [1952] 4 D.L.R. 124 (B.C.C.A.). In Conroy, the Court of Appeal considered whether it was expedient to remove one trustee and appoint a replacement when some of the beneficiaries were dissatisfied with the way the trustee was handling the estate. The court confirmed at 126-127 that the main test for removal of a trustee is the welfare of the beneficiaries:

In Letterstedt v. Broers (1884), 9 App. Cas. 371, their Lordships of the Judicial Committee held that the main principle upon which the jurisdiction of Courts of Equity has been exercised to remove old trustees and substitute new ones in cases requiring such a remedy, is the welfare of the beneficiaries of the trust estate.

[20] In Letterstedt, the court noted that it is not every act of misconduct that should result in removal of a trustee, only acts or omissions which endanger the trust property or show “a want of honesty or a want of proper capacity to execute the duties, or a want of reasonable fidelity.”

Out of respect for the will-maker’s choice of executor, the court should interfere only for good reason: Re Blitz Estate, 2000 BCSC 1596, at para. 20; Tomlinson Estate (Re), 2016 BCSC 1223, at para. 43. This test has been put even higher in some cases, for example in Veitch Estate, 2007 BCSC 952, at para. 19, citing Re Weil, [1961] O.R. 888 (ONCA):
It seems to me that such an interference with the discretion and choice of a person in preparing his last will and testament must be not only well justified but, as has been said before, must amount to a case of clear necessity.

The court’s discretion in deciding whether to remove a trustee should be guided by the following principles, set out in Parker v. Thompson (Trustee), 2014 BCSC 1916, at para. 37:

[37] I accept the principles pertaining to the removal of an estate trustee set out by Madam Justice Nolan in Haines v. Haines, 2012 ONSC 1816 at para. 10 as equally applicable to the removal of the trustee:

In Johnson v. Lanka, 2010 ONSC 4124, (2010), 103 O.R. (3d) 258 at para. 15, Pattillo J. summarized the principles that should guide the court’s discretion in deciding whether to remove estate trustees:

(1) the court will not lightly interfere with the testator’s choice of estate trustee;
(2) clear evidence of necessity is required;
(3) the court’s main consideration is the welfare of the beneficiaries; and
(4) the estate trustee’s acts or omissions must be of such a nature as to endanger the administration of the trust.

To remove an executor on the basis of misconduct, the evidence must show they endangered the estate property, acted dishonestly and without proper care, without capacity to execute the duties, or without reasonable fidelity: Conroy v. Stokes, [1952] 4 D.L.R. 124 (B.C.C.A.). In all cases, the fundamental guide must be the welfare of the beneficiaries: Letterstedt v. Broers (1884), 9 App. Cas. 371 (South Africa P.C.).

Mere friction between the trustee and one or more beneficiaries is usually insufficient to justify removal of the trustee. As stated in Miles v. Vince, 2014 BCCA 289:

[84] What circumstances justify the removal of a trustee? In Letterstedt v. Broers (1884), L.R. App. Cas. 371 (J.C.P.C.), the court established guidelines justifying the removal of a trustee (at 385-389):

1. If the Court is satisfied that the continuance of the trustee would prevent the trusts being properly executed, the trustee might be removed. It must always be borne in mind that trustees exist for the benefit of those to whom the creator of the trust has given the trust estate.

2. The acts or omissions must be such as to endanger the trust property or to show a want of honesty, or a want of proper capacity to execute the duties, or a want of reasonable fidelity.

3. In exercising the delicate jurisdiction of removing trustees, the Court’s main guide must be the welfare of the beneficiaries. It is not possible to lay down any more definite rule in a matter that is so “essentially dependent on details often of great nicety.” The Court must proceed to look carefully into the circumstances of the case.

4. Where a trustee is asked to resign, and if it appears clear that the continuance of the trustee would be detrimental to the execution of the trusts, even if for no other reason than that human infirmity would prevent those beneficially interested, or those who act for them, from working in harmony with the trustee, and if there is no reason to the contrary from the intentions of the framer of the trust to give this trustee a benefit or otherwise, the trustee is always advised by his own counsel to resign.

5. 5. The lack of jurisprudence in respect of the removal of a trustee reflects that a trustee when asked to do so, will resign.

6. If, without any reasonable ground, the trustee refuses to do so the court might think it proper to remove him.

7. Friction or hostility between trustees and the beneficiary is not of itself a reason for the removal of the truste

es. But where the hostility is grounded on the mode in which the trust has been administered, where it has been caused wholly or partially by substantial overcharges against the trust estate, it is not to be disregarded.

The Hill Beneficiaries rely on Sheppe v. Harlingten, 2018 BCSC 1460, regarding dismissal of a trustee due to hostility to the beneficiaries. In that case, the trustee was the grantor’s former husband, and the disputing beneficiaries her children from a subsequent relationship. The trustee wished to sell their family home in which they lived, to use the proceeds in his real estate project. He listed it for sale and they filed a CPL. The trustee then sent them scathing, insulting correspondence (see para .16).

[27] Not every neglect of duty or mistake will result in removal of the trustee. The key question is whether there is or has been endangerment of trust property, whether through a lack of honesty, lack of capacity or lack of reasonable fidelity: Conroy v. Stokes, [1952] 4 D.L.R. 124 (B.C.C.A.); Miles at para. 85.

[28] In Parker v. Thompson (Trustee), 2014 BCSC 1916 at para. 37, Chief Justice Hinkson said at para. 37:

[37] I accept the principles pertaining to the removal of an estate trustee set out by Madam Justice Nolan in Haines v. Haines, 2012 ONSC 1816 at para. 10 as equally applicable to the removal of a trustee:

In Johnson v. Lanka, (2010), 103 O.R. (3d) 258 at para. 15, Pattillo J. summarized the principles that should guide the court’s discretion in deciding whether to remove estate trustees:

(1) the court will not lightly interfere with the testator’s choice of estate trustee;
(2) clear evidence of necessity is required;
(3) the court’s main consideration is the welfare of the beneficiaries; and
(4) the estate trustee’s acts or omissions must be of such a nature as to endanger the administration of the trust.
…
[39] I also cannot ignore the hostility that Mr. Harlingten expressed to the beneficiaries when they took what they considered to be necessary steps to protect their interests.
[40] Dissension between a trustee and beneficiaries is not necessarily a reason to remove the trustee: Conroy at p. 126. The questions is whether it would become difficult for the trustee to act with impartiality or whether the friction is of a nature or degree that it prevents, or is likely to prevent, the proper administration of the trust: Radford v. Radford Estate (2008), 169 A.C.W.S. (3d) 688 (Ont. S. Ct. J) at paras. 112 and 113.

Re Kara Estate 2022 BCSC 923 ordered an executor removed, or passed over since probate had not been started, where all of the beneficiaries sought such an order.

There were allegations of executor delay and favourtism to one party.

The Law

Section 158 of the Wills, Successions and Estate Act, S.B.C. 2009, c.13, provides that:

158.

(2) A person having an interest in an estate may apply to the court to remove or pass over a person otherwise entitled to be or to become a personal representative.

(3) […] the court […] may remove or pass over a person entitled to be or to become a personal representative if the court considers that the personal representative or person entitled to become the personal representative should not continue in office or be granted probate […] if the person entitled to become the personal representative […]:

(f)         is:

(ii)        not responsive, or

(iii)       otherwise unwilling or unable to or unreasonably refuses to carry out the duties of a personal representative,

to an extent that the conduct of the personal representative hampers the efficient administration of the estate.

 

The Court of Appeal in Conroy v Stokes, [1952] 4 DLR 124 (BCCA), set out the types of conduct that could warrant removal of an executor, which include:

(a)  Endangerment of the trust property;

(b)  Want of honesty;

(c)   Want of proper capacity to execute the duties; and

(d)  Want of reasonable fidelity.

Butler J., as he then was, noted in Levi-Bandel v. McKeen, 2011 BCSC 247 at para. 21 that “it is not only an act of misconduct that can be grounds for removal of a trustee. A failure to act can amount to grounds for removal.” In Dirnberger Estate, 2016 BCSC 439, Kelleher J. confirmed that unreasonable delay and failure to act to distribute an estate may be grounds for the removal of an executor.

In Ching Estate (Re), 2016 BCSC 1111 at para. 22, Affleck J. noted:

The authorities indicate that even a “perceived” conflict of interest between an executor’s personal interests and her obligation to administer the trusts in the will in the interests of the beneficiaries may cause this court to intervene to appoint a new executor or an administrator to avoid even the appearance of conflict.

 

The bottom line was stated in Nieweler Estate (Re), 2019 BCSC 401

” The main guide in exercising the Court’s discretion to remove trustees is the welfare of the beneficiaries: Letterstedt at 387. It is not the interests of a particular beneficiary that are to be considered, but rather the benefit of the beneficiaries collectively: Conroy v. Stokes, at 128; Re Winter Estate, at para. 22.”

Re Koglin Estate 2021 BCSC 2525 is one of many court decisions where an application to remove an executor/trustee was refused by the courts. This is not to say that such application cannot succeed, but the evidence must be clear and strong for the courts to interfere with the choice of the will maker as to his or her chosen executor.

The law is reasonably well settled with the leading case in British Columbia, being Conroy v Stokes (1952) 4 DLR 124 BCCA that stated that in order to succeed in such an application, the evidence must show that:

1. The executor acted in a manner that endangered the asset, or

2. As executor, he or she acted dishonestly, without proper care, or without reasonable fidelity;

In Parker v Thompson ( Trustee) 2014 BCSC 1916 . The deceased established in inter vivos trust in which is corporate solicitor was trustee. His chief for children from his first marriage sought to remove the trustee on the basis that he acted in a way that gave precedence to the interests of the second wife and son of his second marriage.

The court quoted an Ontario judgment that stated the principle that “removal of an estate trustee should only occur on the clearest evidence that there is no other course to follow”.

The court stated that the standard of care and diligence required of a trustee is that of a man of ordinary prudence in managing his own affairs and accepted the following principles applicable to the court’s discretion on an application to remove a trustee:

• The court will not lightly interfere with the testator’s choice of estate trustee;
• clear evidence of necessity is required
• the court’s main consideration is the welfare of the beneficiaries;
• the estate trustee’s acts or omissions must be of such a nature as to endanger the administration of the trust.

The existence of friction between the trustee in one or more beneficiaries is not usually sufficient of itself to justify the removal of the trustee Erlichman v Erlichman 2000 BCSC 173 at para.8, however, the court will remove a trustee, where the welfare of the beneficiaries requires it.

In Dimberger Estate 2016 BCSC 439 the court did remove the trustee for failure to distribute the estate after four years after the grant of probate, and took into consideration the trustees ongoing hostility towards his sister the co-beneficiary

In Jury v Rodogzinski 2021 BCSC 2241 the court removed the executor for a perceived conflict of interest where the executor had received the bulk of the estate by way of an inter vivos transfer prior to death, and then was to also receive an equal share of the residue.

The beneficiaries successfully argued that the executor was in a conflict of interest as they asserted that the true intention of the deceased was that all of the beneficiaries would share equally and that under that false impression transferred the real property to the executor two weeks after the will was signed.

The Law

It has been held in a number of cases that an executor may be removed when involved or potentially involved in litigation against the estate in a personal capacity.

In Weisstock v. Weisstock, 2019 BCSC 517

It has repeatedly been held that a conflict of interest may disqualify an executor from acting in that capacity: Re Becker (1986), 57 O.R. (2d) 495 (Ont. Surr. Ct.); Thomasson Estate (Re), 2011 BCSC 481; Stevens v. Whittaker, 2012 BCSC 1188; Ching Estate (Re), 2016 BCSC 1111. Such a conflict may arise if the executor has or may have a claim against the estate or if the estate has or may have a claim against him or her.

In particular, courts have exercised the authority to remove or pass over an executor where there was a dispute over an inter vivos gift made by the deceased to the executor before death.
In Re Becker, 1986 CanLII 2596, 57 O.R. (2d) 495 (Surr. Ct.) the deceased named four persons as executors. One of them, the respondent, purportedly received an inter vivos gift of $107,000 in guaranteed investment certificates shortly before the testator’s death.

The three other named executors brought an application seeking to have the respondent passed over as an executor on the basis that the estate had a claim against him to set aside the gift.

The court granted the order, stating at pp. 6 and 8 (CanLII):
In. It is self-evident that the respondent, in his capacity as executor, cannot conscientiously (as a plaintiff) attack the gift and the transfers of securities to himself while at the same time maintaining in his personal capacity that the gifts and transfers were proper. That will not be a potential conflict; it will be actual…

In Thomasson Estate (Re), 2011 BCSC 481 it was ordered that one of the executors named in a will should be passed over as trustee because he had received an inter vivos transfer of property from the testator, his father.

The beneficiaries of the estate, the testator’s other children, brought the application to have him passed over as trustee on the basis the beneficiaries claimed the property he received in the inter vivos transfer belonged to the estate.

The court noted that courts are hesitant to interfere with the testator’s right to nominate an executor but held that the potential for conflict on the part of the proposed executor was sufficiently disabling that he ought to be passed over.

In Ching Estate (Re), 2016 BCSC 1111, Justice Affleck ordered that an executor be passed over due to a conflict of interest where the named executor, one of the testator’s daughters, applied to prove the will in solemn form and confirm her appointment as trustee. Her sister, a beneficiary, opposed the application on the basis she had commenced an action against the executor to recover an asset the sister claimed was part of the estate. The executor had received the asset from the testator through an inter vivos transfer before her death.

The executor claimed the property was a gift in recognition of continuing assistance she had given to her parents for their medical care.

Without commenting on the merits of the asset recovery action, Justice Affleck found the circumstances placed the executor in a “disabling conflict of interest”.

He said at para. 23 the executor is put in difficult circumstance “when she defends her right to retain assets as her own when there is a dispute over whether they belong to the estate. She cannot perform her duty to claim assets for the estate while asserting the same assets belong to her.”

In Re Yurkiw estate 2021 BCSC 1015 two executors applied to have each other passed over so as to be the sole executor but the court dismissed both applications and pursuant to S. 158 WESA  appointed a third party administrator.

 

Section 158 of the Wills, Estates and Succession Act, S.B.C. 2009, c. 13, provides for the passing over of a person entitled to become a personal representative if the court considers that the person “should not be granted probate or administration.”

In Dunsdon v. Dunsdon, 2012 BCSC 1274 at paras. 202-203, Justice Ballance outlined considerations for removal of a trustee:

”   Put broadly, a trustee may be removed where his or her acts or omissions endanger the trust property or demonstrate a want of honesty, of reasonable fidelity, or of the proper capacity to execute the duties of office:  Conroy v. Stokes [1952] 4 D.L.R. 124 (B.C.C.A.). The existence of friction between the trustee and one or more beneficiaries is usually not sufficient, of itself, to justify removal of the trustee: Erlichman v. Erlichman, 2000 BCSC 173; Re Blitz Estate, 2000 BCSC 1596.

However, where there is dissension among the trustees themselves by which the trust administration grinds to a standstill or otherwise hampers the proper administration, the courts tend to remove one or more of them. In those instances, misconduct per se is not an essential prerequisite: Re Consiglio Trusts (No. 1) (1973), 36 D.L.R. (3d) 658 (Ont. C.A.); Wilson v. Heathcote, 2009 BCSC 554.

 In all cases, the fundamental guide must be the welfare of the beneficiaries: Letterstedt v. Broers, (1884), 9 App. Cas. 371 (South Africa P.C.).

While the applications before the court were not for removal, it is common ground that the considerations in Dunsdon are relevant to passing over applications. as was done in : Weisstock v. Weisstock, 2019 BCSC 517.