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Pierce v. Zock – When Can a Trustee Withdraw?

In the recent Superior Court case Pierce v. Zock, 2019 ONSC 4156, the deceased had established a discretionary (Henson) trust and a trust for the operation and management of the family farm (“the Farm Trust”) in his primary and secondary wills.

In both instances the deceased appointed two of his four adult children (G and N) as the trustees. One of the adult children, S, was in receipt of ODSP due to a diagnosed mental health condition and lived with his parents for his entire lifetime until their death.

Since the deceased’s death in 2014 S resided on his own in the residence on the farm property which is otherwise leased under a share crop arrangement.

The two trustees applied to the court to be removed as trustees for the following reasons:

  1. Their relationship with S is marked with conflict. They allege that S is constantly demanding money, is belligerent and intimidating and they do not feel safe with him;
  2. They allege that S does not clean and maintain the property; and
  3. S has refused reasonable offers to sell the farm property.

The discharge and removal of a trustee is governed by the provisions of the Trustee Act, and in particular sections 3(1) and 5(1). At paragraphs 26 and 27 of the decision the Court notes:

[26]           A trustee cannot be forced to continue to serve as a trustee if he or she is no longer willing or able to continue: Mitchell v. Richey, 1867 CarswellOnt 84 at paras. 4-6. The inherent equitable jurisdiction of the Court includes the power to remove an estate trustee, even where such removal would leave the estate without a trustee, provided the court makes alternate provision for the proper administration of the estate: Evans v. Gonder, 2010 ONCA 172 (CanLII) at para. 24.

[27]           In this case, both trustees wish to be discharged. They have not appointed substitute trustees nor do they put forward anyone willing to step into that role. They asked the Public Guardian & Trustee (“PGT”) to step in as trustee but it has declined. This court has no authority to order the PGT to take on this role: Potrzebowski v. Potrzebowski, 2016 ONSC 6981 (CanLII) at para. 9.

The trustees noted that the size of the estate was too modest to consider the appointment of an institutional trustee. However, it would be a viable option if and when the farm property was sold.

It is always critical to consider that successful court applications are evidence based. In this case the court noted that there was no expert evidence filed in support of the application and such evidence would have assisted the court in these areas:

  1. A capacity assessment in respect of S’s ability to manage his personal care generally and in the farm home specifically;
  2. A home inspection report regarding the condition and maintenance of the home;
  3. Current market appraisals and opinions regarding the advisability of the timing of a sale; and
  4. A report from an institutional trustee indicating the conditions under which an appointment would be accepted.

In addition, the applicants did not put forward any individual replacement trustee proposals.

Without any such evidentiary assistance the Court permitted only one of the trustees to be discharged but required the other (N) to remain subject to specified terms and conditions. Furthermore the Court declined to order the sale of the farm based on the lack of evidence that S was not properly maintaining the home and the absence of evidence of market urgency.

Clearly it is not enough to apply to be removed as trustee because one is no longer willing to act and the conditions are difficult. The Court must be satisfied based on appropriate evidence that a suitable replacement is available to fulfill the duties and obligations under the trust.


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