Saunders v. Vautier While Parties Engaged in Litigation
1. Introduction
Can a sole beneficiary who is of full age demand payment of the residue from the executor when she is engaged in litigation with the executor. That is the issue raised in Pitt v Beattie.[1]
2. Facts
The testator, Brian Beattie (‘Brian’) died in May 2020. His brother ‘Ian’ was appointed estate trustee. Brian’s Will left the residue of his estate in trust for the Plaintiff, Ms Pitt, until she attained age 25. She is now 23 years old but is entitled to the property under the rule in Saunders v Vautier,[2] since she is of full age and not otherwise under any disability. However, she brought an action against Ian and his two children in which she alleges that Ian sold the major asset of the estate, a parcel of real property, to his two children in an improvident sale without exposure to the market, and at an undervalue.
Ian acknowledges the Plaintiff’s entitlement to receive funds before she reaches age 25 under the rule in Saunders v Vautier. He released $100,000 to the Plaintiff and is willing to distribute another $200,000 to her, provided the Plaintiff executes a partial release concerning Ian’s management of the estate funds.
The Plaintiff then brought this motion seeking a partial distribution of the estate in the amount of $300,000 as its sole beneficiary. Ian opposes the motion on the ground that the rule in Saunders v Vautier does not permit a beneficiary to bypass the administration of the estate. He argues that the amount to be paid to the Plaintiff cannot yet be determined because the amount of the residue is unknown and because funds need to be retained until judgment is rendered in the action and to pay his costs as estate trustee.
3. Analysis and Judgment
Justice Nicholson began his analysis by noting that a beneficiary is not entitled to be paid his share of the estate until the executor is prepared to distribute the estate. Nor is he entitled to receive an interim distribution.[3] The court only has jurisdiction to intervene in the exercise of a discretion by an executor or trustee in the following situations: (1) a mala fides exercise of the discretion; (2) a failure to exercise the discretion; and (3) a deadlock between executors or trustees about exercising a discretion.[4] His Honour noted that, as distinct from another case,[5] the estate trustee did not refuse to make a distribution unless the beneficiary signed a partial release. Rather, he refused to make a distribution in the amount claimed by the Plaintiff. Thus, there was no male fides on the part of the estate trustee.
His Honour further noted that an estate trustee is generally entitled to be fully indemnified from the estate for all reasonably incurred legal costs, including litigation costs, unless the estate trustee acted unreasonably or in his own self-interest. In this case the Plaintiff is impugning the actions of estate trustee on the ground that they were done in his own and his children’s interest. If the Plaintiff is successful, it is likely that her costs will have to be paid by the defendants. On the other hand, if the defendants should succeed, it is likely that the Plaintiff will be ordered to pay their costs.
Justice Nicholson held that the estimation by the estate trustee of future legal costs does not amount to ‘security for costs’ but constitutes a legitimate holdback. He noted that estate trustees have significant leeway in maintaining such a holdback. Further, he concluded that it would be speculation on his part to assume what the outcome of the trial will be and what order the court may make about the costs.
His Honour went on to hold that the estate trustee was entitled to determine the amount to be distributed. He also held that the two offers the estate trustee made to the Plaintiff, one of which was unconditional and the other conditional on the Plaintiff’s execution of a release cannot be characterized as holding the Plaintiff hostage, as it was in the Brighter case.
Finally, his Honour held that the rule in Saunders v Vautier does not trump the discretion of an estate trustee who exercises his discretion reasonably and where the amount of the residue remains uncertain.
Consequently, his Honour dismissed the Plaintiff’s motion.
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[1] 2025 ONSC 5654.
[2] (1841), 4 Beav 115, 49 ER 282 (Rolls Ct), affirmed 1 Cr & Ph 240, 41 ER 482 (Ch Div), discussed in Buschau v Rogers, 2006 SCC 28.
[3] Citing, inter alia, Furfari v Furfari, 2016 ONSC 4882, para 30, per Wilton-Siegel J; Bank of Nova Scotia Trust Company v Charles, 2021 ONSC 1361.
[4] Parson v McGovern, 2014 ONSC 1785, para 26, per Smith J.
[5] Brighter v Brighter Estate, 1998 CarswellOnt 3113, para 9, per Sheard J. In that case the executor distributed the shares of two beneficiaries unconditionally, while insisting that the dissenting beneficiary sign a release and waive the passing of accounts before he would be paid his share.
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Written by: Albert Oosterhoff
Posted on: January 30, 2026
Categories: Commentary, WEL Newsletter
1. Introduction
Can a sole beneficiary who is of full age demand payment of the residue from the executor when she is engaged in litigation with the executor. That is the issue raised in Pitt v Beattie.[1]
2. Facts
The testator, Brian Beattie (‘Brian’) died in May 2020. His brother ‘Ian’ was appointed estate trustee. Brian’s Will left the residue of his estate in trust for the Plaintiff, Ms Pitt, until she attained age 25. She is now 23 years old but is entitled to the property under the rule in Saunders v Vautier,[2] since she is of full age and not otherwise under any disability. However, she brought an action against Ian and his two children in which she alleges that Ian sold the major asset of the estate, a parcel of real property, to his two children in an improvident sale without exposure to the market, and at an undervalue.
Ian acknowledges the Plaintiff’s entitlement to receive funds before she reaches age 25 under the rule in Saunders v Vautier. He released $100,000 to the Plaintiff and is willing to distribute another $200,000 to her, provided the Plaintiff executes a partial release concerning Ian’s management of the estate funds.
The Plaintiff then brought this motion seeking a partial distribution of the estate in the amount of $300,000 as its sole beneficiary. Ian opposes the motion on the ground that the rule in Saunders v Vautier does not permit a beneficiary to bypass the administration of the estate. He argues that the amount to be paid to the Plaintiff cannot yet be determined because the amount of the residue is unknown and because funds need to be retained until judgment is rendered in the action and to pay his costs as estate trustee.
3. Analysis and Judgment
Justice Nicholson began his analysis by noting that a beneficiary is not entitled to be paid his share of the estate until the executor is prepared to distribute the estate. Nor is he entitled to receive an interim distribution.[3] The court only has jurisdiction to intervene in the exercise of a discretion by an executor or trustee in the following situations: (1) a mala fides exercise of the discretion; (2) a failure to exercise the discretion; and (3) a deadlock between executors or trustees about exercising a discretion.[4] His Honour noted that, as distinct from another case,[5] the estate trustee did not refuse to make a distribution unless the beneficiary signed a partial release. Rather, he refused to make a distribution in the amount claimed by the Plaintiff. Thus, there was no male fides on the part of the estate trustee.
His Honour further noted that an estate trustee is generally entitled to be fully indemnified from the estate for all reasonably incurred legal costs, including litigation costs, unless the estate trustee acted unreasonably or in his own self-interest. In this case the Plaintiff is impugning the actions of estate trustee on the ground that they were done in his own and his children’s interest. If the Plaintiff is successful, it is likely that her costs will have to be paid by the defendants. On the other hand, if the defendants should succeed, it is likely that the Plaintiff will be ordered to pay their costs.
Justice Nicholson held that the estimation by the estate trustee of future legal costs does not amount to ‘security for costs’ but constitutes a legitimate holdback. He noted that estate trustees have significant leeway in maintaining such a holdback. Further, he concluded that it would be speculation on his part to assume what the outcome of the trial will be and what order the court may make about the costs.
His Honour went on to hold that the estate trustee was entitled to determine the amount to be distributed. He also held that the two offers the estate trustee made to the Plaintiff, one of which was unconditional and the other conditional on the Plaintiff’s execution of a release cannot be characterized as holding the Plaintiff hostage, as it was in the Brighter case.
Finally, his Honour held that the rule in Saunders v Vautier does not trump the discretion of an estate trustee who exercises his discretion reasonably and where the amount of the residue remains uncertain.
Consequently, his Honour dismissed the Plaintiff’s motion.
—
[1] 2025 ONSC 5654.
[2] (1841), 4 Beav 115, 49 ER 282 (Rolls Ct), affirmed 1 Cr & Ph 240, 41 ER 482 (Ch Div), discussed in Buschau v Rogers, 2006 SCC 28.
[3] Citing, inter alia, Furfari v Furfari, 2016 ONSC 4882, para 30, per Wilton-Siegel J; Bank of Nova Scotia Trust Company v Charles, 2021 ONSC 1361.
[4] Parson v McGovern, 2014 ONSC 1785, para 26, per Smith J.
[5] Brighter v Brighter Estate, 1998 CarswellOnt 3113, para 9, per Sheard J. In that case the executor distributed the shares of two beneficiaries unconditionally, while insisting that the dissenting beneficiary sign a release and waive the passing of accounts before he would be paid his share.
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