The most common circumstance in which the Court generally removes an executor is when there is a clear conflict of interest
The Court has the power to remove an executor if it is satisfied that there are reasonable grounds for doing so. When deciding whether to remove and replace an executor, the Court’s primary consideration will always be the welfare of the beneficiaries. There are numerous legal principles that guide the Courts when determining whether to remove an executor. They are best summarized as follows:
- The removal of an executor will not be undertaken lightly by the Courts;
- The Court must be satisfied that the removal is in the best interests of the beneficiaries generally;
- If the continued administration by the executor would be detrimental to the estate or the execution of the trusts under the Will, the Court may remove the executor;
- Justified reasons for removal can include the following:
- misconduct on the part of the executor amounting to an abuse of trust (i.e. stealing money from the estate);
- conflict of interest of the executor;
- endangerment of estate property;
- lack of requisite capacity or ability to execute duties; and/or
- undue delay in performing executor duties.
- Friction and hostility between the executor and one or more of the beneficiaries is typically not strong enough grounds for removal, and neither is a suspicion that the executor may favour certain beneficiaries over others;
- A technical breach of trust or a small isolated error may not be enough to remove an executor if it was done in good faith and with the interests of the beneficiaries clearly in mind; and
- Administration that consistently fails to maintain equality between the beneficiaries will in the vast majority of cases be enough to justify removal of an executor.
The most common circumstance in which the Court generally removes an executor is when there is a clear conflict of interest. This occurs whenever the executor’s personal interest conflicts with the interests of the beneficiaries for whose benefit the executor has a duty to act.
There are many examples where there can be a conflict of interest. One common example is where there are allegations by the beneficiaries that the executor holds certain property in trust for the testator, but the executor disagrees and refuses to place the property into the estate “pool” of assets. In that situation, the executor has a duty to take steps to collect the asset for the benefit of the estate but obviously an executor isn’t going to sue himself/herself. Hence, there is a clear conflict of interest.
The above conflict arises where the executor is placed on the testator’s real estate or bank accounts, as a joint owner, to help the testator administer his/her affairs but upon death, the executor refuses to hand over the assets to the estate and instead, tries to “pocket” the money.
When the court is addressing whether the conflict is enough to disqualify the executor, it has to determine whether the executor has found themselves in such a position that would prevent them from acting impartially with respect to the estate and the beneficiaries.
Another common ground for removal is where the executor is slow moving and by failing to take proper steps, is causing an erosion of the value of the estate. An example is where the executor is not listing real estate in a timely manner without excuse and as a result, the value of the property declines while at the same time, the estate has to pay the maintenance, taxes and upkeep on the property.
Even if there are grounds to remove the executor, there still must be another better alternative. Often it is difficult to find an alternative independent executor as most of the beneficiaries will have a stake in the outcome. Private trust companies or lawyers/notaries are “picky” on what estate to take over ensuring that there is sufficient money in the estate to allow for their sometimes-expensive fee structure.
In summary, there must be an obvious conflict of interest or some high handed/ neglectful actions on the part of the executor to convince the Court to have the executor removed. There also has to be a better alternative.
Who Can Apply to Vary a British Columbian Will?
Get a free
Get a free, no obligation consultation. Our office will contact you within a few hours.Get Started