Key Takeaways from Carpenter Estate Court Ruling

We hope you are enjoying the sunshine and staying cool. In heat waves like this one, remember to check on your loved ones! This month’s case is Carpenter Estate (Re), 2024 BCSC 745, in which the Court decided on an application by one brother to remove the other as executor and trustee of their father’s estate.

Applications like these are not uncommon, no matter how big or small the estate is. Sometimes there are very good reasons for wanting to remove an executor; there might, for example, be a conflict of interest or the executor might be favouring one beneficiary over another. Choosing the right executor or executors is never easy.

In this case, the Applicant son felt that his brother had failed to act in the best interest of the estate by failing to optimize the value of the estate for the beneficiaries, had disposed of estate assets without consent of the beneficiaries, had misappropriated funds from the deceased father while he was alive, and had done a number of other things which disqualified him.

The Honourable Justice Donegan explained the well-established law pertaining to these kinds of applications, among which is the principle that a court will not replace an executor without good reason and, as some courts have said, unless doing so is “clearly necessary” and for very specific reasons. In brief, it is a high legal threshold for the Applicant to meet.

Justice Donegan noted that while the executor had made some errors, including by not including two small bank accounts on the court document listing the assets of the deceased, these were “innocent errors” and that the executor, “like any executor, cannot be held to the standard of perfection”.

The Applicant’s other allegations were dismissed by Justice Donegan, who found they lacked evidence and were often contradicted by what evidence was available.

There were further allegations including the father’s capacity while he was alive, undue influence, and a misappropriation of funds. Justice Donegan likewise dismissed these as being without merit.

The application was dismissed in full, with costs against the Applicant.

As I said above, these kinds of applications are not uncommon. Beneficiaries often feel like they are not being provided with the information they are entitled to, or that the executor is not disposing of the estate in a way that they feel maximizes the value of a particular asset.

When deciding whether or not to proceed with such an application, it’s always important to remember that a) the standard is not perfection, and a court will not remove an executor without a very good reason, and b) in order to support such an application it is critical to provide the court with sufficient reliable evidence for them to make the order you are seeking.

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