Disputes often arise between co-executors or between beneficiaries and an executor during the course of the administration of an estate. Often these disputes involve the way in which the executor is carrying out his or her duties. Sometimes there is a long and acrimonious history between the parties that remains unresolved and contentious long after the will-maker’s death.
Unfortunately the situation will often deteriorate to such an extent that either co-executors or one or more of the beneficiaries will consider legal action to remove or replace an acting executor. Nothwithstanding difficult or untenable relationships between the parties involved, the decision to apply to the court for an order to remove an executor should not be taken lightly.
Generally speaking, in BC the test to remove an executor is based on whether there is prejudice to the estate or the beneficiaries. The courts start from the position that a will-maker is entitled to appoint the executor of his or her choice and that discretion will not be lightly interfered with. In a leading decision of the BC Court of Appeal, the court held that an executor would have to act “in a manner that endangered the estate, or that as executor she or he acted dishonestly, without proper care, or without reasonable fidelity”.
Situations in which an executor has been successfully removed include:
- Where the executor’s duties were in conflict with his or her personal interests;
- Estate assets were endangered or dissipated by the executor’s conduct;
- The executor took a benefit at the expense of the estate;
- The executor was declared bankrupt or convicted of a felony offense;
- The executor failed to distribute the assets in a timely manner following the expiration of what is known as the executor’s year; or
- The executor was incompetent or mentally incapable.
This is by no means an exhaustive list. Each application will depend on the particular facts. Every estate is as different as the families and individuals involved. As stated earlier, the decision to apply to court should not be taken lightly. It should only be considered when all other avenues, including communication and negotiation between the parties, have failed or if the assets of the estate are in immediate and real danger.
Costs are an important consideration. If an executor successfully defends an application for removal, the estate may be liable for his or her costs. If an executor is removed, there will have to be a passing of his or her accounts and the estate will have to pay those fees. Any subsequently appointed executor will also be entitled to fees for the administration of the estate.
In conclusion, if you are a beneficiary under a will or a co-executor and you believe an executor is acting in a manner that is prejudicial to either the estate’s assets or your interests under the will, consult a wills and estates lawyer regarding your legal remedies.
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