The appellant, acting as estate trustee for the late Sophia De Jonge, appealed the disallowance of a property claim by the bankruptcy trustee of the estate of Jeffrey Wilson.
Jeffrey, who was the executor of Sophia's estate, had transferred real property to himself without satisfying a significant tax liability owed by Sophia's estate.
Jeffrey subsequently died bankrupt.
The court found that Jeffrey breached his fiduciary duty as executor by failing to pay the estate's debts before distributing assets to himself.
The court imposed a constructive trust over the real property in favour of Sophia's estate to remedy the unjust enrichment of Jeffrey's bankrupt estate, allowing the appellant to trace the beneficial interest into the net sale proceeds.
