Hope v. Martin, 2011 ONSC 5447 (CanLII)
What do you do when the estate trustees renounce and the lawyer holding the original Will won’t release it to you?
Justice Brown addressed this issue in deciding Hope v. Martin, 2011 ONSC 5447. The named estate trustees (including the drafting lawyer) had renounced and a beneficiary agreed to act as estate trustee. The lawyer holding the original Will refused to release the Will to the intended applicant for the Certificate of Appointment so that she could apply for probate. After much correspondence, the lawyer forced the intended applicant to seek an order for assistance, to which he consented, so that a court Order could be obtained that required him to provide the original Will to the beneficiary.
Be Wary of What You Ask For
Courts have the power to order assessments of a person’s capacity to manage their property and/or personal care. Such an order is often necessary in situations where there is a dispute as to the “degree” of incapacity or whether a person is capable at all.
Advertising for Creditors – Still Worth Doing?
Summary: Why do we tell our client estate trustees to advertise for creditors – is it truly a step that still needs to be taken?
Estate Trustees are usually advised to publish a proper advertisement for creditor’s claims before paying any debts or legacies or distributing any portions of residue. The basis for this is section 53 of the Trustee Act which provides that, where an estate trustee has given such notice, he or she may distribute the assets in the estate at the expiration of the time specified in the notice (or the last of such notices) for sending in claims against the estate. The estate trustee is therefore arguably not liable for any person’s claim that has not been received at the time of distribution.
The process is to place the advertisement as soon as possible after death in the locality in which the deceased lived or carried on a business at the time of death; typically, placing two or three inserts once a week for successive weeks and giving a month’s notice from the first publication.
There are times when it is perhaps “more” important to take this step. Pursuant to section 26 of the Estates Administration Act, if the deceased was intestate, no distribution can be made within the year following the death unless the estate trustee has advertised for creditors. Where there is an administration bond or an active business it is generally considered more prudent to publish the notice.
However, remember (and we should not forget to remind our clients) that advertising for creditors does not extinguish the debt. In accordance with section 53(2) of the Trustee Act, creditors may “follow the proceeds of the trust estate, or assets, or any part thereof into the hands of the persons who have received same.” Advertising for creditors simply and importantly attempts to extinguish the personal liability of the estate trustee for distributing assets. A question I have often had is does this statutory provision truly extinguish that personal liability? I cannot provide assurances here, but the prudent lawyer would advise the client that doing so reduces the risk, even if it does not eliminate it. Remember to document any decision made against advertising if that is the client’s ultimate decision.
Lesson Learned: Although it is always ideal (like spring cleaning) to do certain things, it is also important to take a step back and ask why we do those things even if in the end prudence dictates doing it.
Until next time,