J. D. Skinner

In an estate administration dispute, the court determined liability for costs following earlier reasons criticizing the conduct of the estate trustees.

The trustees had failed for several years to distribute a simple estate despite the assets being liquidated and ready for distribution, instead engaging in mutual blame and obstructive conduct.

The court rejected submissions that the estate should indemnify the trustees’ legal costs, finding that their disregard of fiduciary duties should not diminish the beneficiaries’ shares.

The court therefore ordered the trustees personally responsible for the applicant’s full indemnity costs.

Each trustee was directed to pay one-half of the award, with any shortfall payable personally.

An application was brought under rule 14.05(3) of the Rules of Civil Procedure and ss. 5 and 37 of the Trustee Act seeking the removal of two estate trustees.

The estate had remained undistributed for more than five years despite liquid assets, due to significant conflict and animosity between the co‑trustees which resulted in administrative paralysis.

The court found fault on both sides and concluded that continuation of the trustees would jeopardize the proper execution of the trust and the interests of the beneficiaries.

Both estate trustees were removed and a neutral succeeding estate trustee was appointed.

The former trustees were ordered to pass their accounts within 60 days.