Creating a will or devising a comprehensive estate plan is never an easy task to contemplate. It involves dealing with inevitable end-of-life issues, something that’s obviously difficult to canvass.
It’s understandable given the issues at stake that many people simply regard the process as one they want to strike off their checklist and not have to contemplate again any time soon.
But the stakes are high if people fail to follow proper planning procedures as a poorly devised will can mean bitter disputes between the heirs and potential lawsuits involving the estate.
The issue of estate trusteeship and whether it’s advisable to have joint estate trustees to manage the affairs is a contentious issue and one that has been subject to noteworthy litigation.
The case law would seem to suggest in rather certain terms that for the purposes of estate planning, naming joint estate trustees is generally not advisable and that in most circumstances, the best decision for a testator is to name a single estate trustee with at least one alternate.
The recent case of Chambers Estate v. Chambers illustrates the point. The facts are somewhat complex, but the crux of the matter was that the applicant son, who was in a bitter dispute with the other named estate trustees, moved to appeal a decision by the Superior Court that had rejected his application to have himself and a trust company named as co-trustees in one of his late father’s wills.
A central issue was whether the two people named could renounce their role as estate trustees.
The Ontario Court of Appeal made it very clear that the act of renunciation “is generally not available if a party has intermeddled with the estate.”
Simply put, the act of renouncement isn’t available where a named trustee deals with the estate, even if perfunctorily or inadvertently. The consequences for the administration of an estate can be detrimental as the harshness of the legal ramifications, coupled with the interfamilial disputes often at the core of estates law, can devolve into a logistical nightmare and protracted litigation.
There are very important lessons estates law practitioners must take away from this case. The first is that naming co-trustees is generally problematic as meddling can happen and the most advisable procedure is to name one person with one or two substitutes.
On the other hand, the solicitor must at all times uphold the stated intentions of the testator. So if the testator insists on multiple estate trustees, a blanket refusal to comply with the request may create friction with the client.
Yet in protecting the client’s best interests, the lawyer must be mindful of the adverse consequences to the estate later on and attentive to the salient issues that may lead to protracted estate litigation or a professional negligence lawsuit from angry heirs.
In these tricky circumstances, the lawyer’s fundamental task is to explain to the client the impact of the jurisprudence and gently canvass the potential minefield that may result from designating more than one trustee.
In the end, the decision rests with the testator. The best the solicitor can do if a client insists on having co-trustees is to get it all in writing.
Jeremy Richler is a Toronto lawyer who practises in a number of areas including wills and estates.