Douglas D. Buchmayer

Following a successful application to remove the respondents as trustees of a family trust, the applicant sought costs on a substantial indemnity basis payable by the trustees personally.

The court awarded the applicant partial indemnity costs payable by the trustees personally, finding their conduct unreasonable but not reprehensible.

The balance of the applicant's full indemnity costs was ordered to be paid from the family trust.

The trustees were denied indemnification from the estate for their own costs due to their unreasonable conduct.

The applicant sought the removal of the respondents as trustees of a family trust, alleging mismanagement, failure to account, and bad faith.

The trustees had made over $3 million in undocumented, unsecured loans to themselves and their children, failed to pass accounts for over a decade, and attempted to dictate the terms of the applicant's will in exchange for continuing his monthly trust payments.

The court found that the trustees' conduct was so unreasonable that no honest or fair-dealing trustee would have acted in that way, and that they failed to act impartially despite having absolute discretion.

The application was granted, the trustees were removed, and an institutional trustee was appointed in their place.

The applicant estate trustee sought costs following a successful application to pass her accounts.

The respondent beneficiaries had raised over 300 objections, abandoning most at the hearing, and maintained unfounded allegations of theft and fraud against the trustee.

The court found the respondents' conduct reprehensible and ordered them to personally pay the trustee's costs on a substantial indemnity basis, fixed at $325,000.

The applicant brought a motion to strike an affidavit sworn by his mother, one of the respondent trustees, on the basis that she was not produced for cross-examination due to concerns about her capacity.

The applicant argued that admitting the affidavit would prejudice the fair hearing of his application to remove the trustees and would be an abuse of process.

The court dismissed the motion, finding that the applicant had not availed himself of opportunities to cross-examine the affiant with accommodations or to seek court directions earlier.

The court held that the affidavit should be admitted, with the lack of cross-examination going to the weight of the evidence to be determined at the hearing.