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LEGAL REPORT: WILLS & ESTATES No executor required B eing asked to be an executor is an honour, albeit an onerous one at best. If one is unable or unwilling to fulfill the duty, clearly one can and should renounce. But what if the executor has already intermeddled in the administra- tion of the estate? At that point, it's not so easy to extricate oneself. In a recent Ontario Superior Court case, Evans v. Gonder, the court removed the estate trustees who no longer wished to act, and did not appoint another. In Evans, the testatrix named her sister and brother-in-law, Margaret and Graeme Evans, as trustees. The estate consisted mainly of a small house in Hamilton, Ont. In her will, she gave her mother a life interest in the vacant house. Although the mother was alive, she was unable to live in the house, which had a lien in favour of Canada Revenue for around $32,000. The residue of the estate was divided in thirds, one third going to a brother, BY SUSAN HUGHES Allan Gonder, who brought an action claiming the deceased held the house for his sole benefit. To complicate mat- ters, Gonder opposed the removal of the estate trustees, arguing that under s. 37 of the Trustee Act they could not be removed unless a replacement was found. Moreover, the public guardian and trust- ee did not want to become involved. The court did not find in Gonder's favour, citing 1867's Mitchell v. Richey that held "no person can be compelled to remain a trustee." The court also referred to the dictum in Mitchell that said if a trustee could not "denude himself of that character, it would operate as a great dis- couragement to mankind to undertake so arduous a task." Paul Trudelle, of Hull & Hull, says Evans will not have a major impact on his prac- tice since the circumstances don't come up often. "It may be something that we see in smaller estates where you don't get anyone Key Developments in Estates and Trusts Law in Ontario 2009 Edition Madam Justice Bonnie Croll and Melanie Yach with contributors Estates and trusts law is evolving. Make sure you stay up to date. Published annually, this book brings together a team of leading practitioners who provide expert insight into the latest noteworthy developments in estates and trusts law. Some articles in this collection include: • View from the Bench by • Personal Trusts by • Insurance, RRSPs and RRIFs by • Passing of Accounts, by • Costs in Estate Litigation by • Powers of Attorney by Order your copy today! Hardbound • 176 pp. • August 2009 • Standing order $105 • P/C 0241140000 Current edition only $115 • P/C 0241010000 • ISSN 1916-8349 canadalawbook.ca MERGING TRADITION WITH TECHNOLOGY For a 30-day, no-risk evaluation call: 1.800.565.6967 Canada Law Book is a Division of The Cartwright Group Ltd Prices subject to change without notice, to applicable taxes and shipping & handling. 44 NO VEMBER / DECEMBER 2009 www. C ANADIAN Law ye rmag.com Croll_Key Developments (CL 1-3sq).indd 1 10/28/09 10:10:16 AM CL1109 who wants to act. You often do find a gap or a hole where there is no estate trustee. If it's a bigger estate you can always turn to one of the trust companies. "It's not clear here why the other ben- eficiaries didn't take an active role. I think the [public guardian and trustee] would point to them and say it's for their ben- efit and we're not going to become estate trustees. In a straightforward administra- tion of an estate, the estate trustee would hire a lawyer, the property would be sold, the taxes paid, but in this case hardship was a factor. The estate trustees had to travel to respond to the litigation and to attend examinations for discovery." They were elderly, in poor health, lived out of province, and had spent $40,000 to defend the estate against the brother's claim. But there is likely a flip side to Evans, adds Trudelle. "This case stands for the proposition that you can be removed as an estate trustee even if there is no replacement. It might also be used to resist someone being removed. The court may say they were removed in this case because there were extreme circumstanc- es. In the other case, it may be that if you can't show substantial hardship, the court won't remove you. It may be that unless you can show all of those factors, or a number of those factors, the court won't let you give up the job so easily. That's an important part of this case as well." Evans also points to the importance of testators keeping in mind, the capacity of the estate trustees, their circumstances, and ability to act. And how it's crucial to update a will as circumstances change. "I don't know who will want to take this case on," says Trudelle. "No one is going to take that on unless there is some security to get compensated at the end of the day. It leaves the estate up in the air. What's going to happen with respect to the payment of taxes? There's already a lien on the property for unpaid taxes. If there's insurance on the house, it's not going to last long. No one's looking after the mother's life interest in the house. . . . Those problems, I guess the judge thought, weren't so great though as to warrant keeping on the estate trustees." Susan Slattery Susan Easterbrook haley Mr. Justice David M. Brown Robin Goodman Kimberly W Jasmine Sweatman