The appellant appealed an order holding her jointly and severally liable for trust funds wrongfully removed from a trust established for grandchildren beneficiaries.
The Court of Appeal upheld findings that the appellant abdicated her role as co-trustee by authorizing her nephew to invest trust funds in his unfettered discretion and then making no inquiries into the investments or administration of the trust.
Relief under s. 35(1) of the Trustee Act was unavailable because the loss arose from the investment of trust property and the appellant had not acted reasonably.
The exculpatory clause in the trust indenture did not protect a trustee who improperly delegated her powers and failed to function as a trustee.
The appeal was dismissed with nominal costs to the respondent.
