Removal of a Badly Behaving Executor in BC

As a beneficiary of a will, it can be frustrating to sit helplessly waiting while the will’s executor fails to administer the estate as expected. Unfortunately, executors sometimes cause intentional delays, are incompetent in their administration, or even abuse their powers to commit theft of estate assets. When this happens, the suffering falls on the beneficiaries – the value of estate assets changes over time, accumulated maintenance costs deplete the estate’s value, and the distribution of assets doesn’t always happen in a fair and timely manner. In these situations, beneficiaries may be able to seek removal and replacement of the executor.

Legal Grounds for Executor Removal

According to the judgement in Nieweler Estate (Re) (2019), there are four categories of conduct that will warrant a removal of an executor:

1. Endangerment of the trust property (estate);
2. Dishonesty;
3. Incapacity to execute the duties; and
4. Lack of reasonable fidelity (good faith).

The case of Radford v. Wilkins (2008) exemplifies the process through which the courts will change an executor. The factors that are considered when determining whether or not to remove an executor are:

• The testator’s choice of executor is not to be lightly interfered with,
• Clear necessity for removal in the interest of the estate’s administration must be established,
• Removal must be the only reasonable course to follow,
• Removal to be guided in the interest of the welfare of beneficiaries,
• Non-removal must likely prevent proper execution of trust, and;
• Removal cannot be not intended to punish past misconduct.

Reasons for Executor Removal

The courts will always hesitate to remove an executor because the testator specifically appointed them as part of their last wishes. However, when it is necessary to remove an executor to protect the beneficiaries’ welfare, the courts will issue an order. The courts view executor removal as a last resort option. Any interested party (someone with a legal stake in the estate) can make an application to remove the executor if they fail to fulfill their duties. Among other reasons, some of the most common grounds for executor removal include undue delay, refusal to act, and fraudulent behaviour.

Common Grounds for Removal

When an executor is actively working to fulfill their duties but experiences an unreasonably explainable delay. Refusal to act by an executor is when they are completely refusing to advance the administration of the estate. An executor’s refusal to act is commonly purposeful and rarely justifiable, especially since executors can renounce their responsibilities at any time.

If an executor behaves fraudulently in relation to the administration of the estate assets, it will also result in their removal. Executors also must release a full account of everything that went into and out of the estate to its beneficiaries. If the beneficiaries don’t agree with the accounts, believing that there may have been fraudulent activity or a miscalculation of estate assets involved in the accounting, they can have the account reviewed by the courts in a passing of accounts.

An Example from Caselaw

In the case of the Kajaks Estate (2016), the executor had failed to administer and distribute the estate after 9 years following the testator’s death. The executor was constantly delaying the process in an attempt to coerce the beneficiaries to agree to change the will to benefit the executor more substantially. It was evident to the court that not having received their portions of the estate for 9 years was impacting the welfare of the beneficiaries. Further, the executor demonstrated a lack of reasonable fidelity as there was no reasonable explanation for these delays. The courts granted an executor removal on these grounds so the estate administration process could move forward.

When The Courts Won’t Grant Executor Removal

The Canadian common law principle of the executor’s year is a general guideline for executors, advising that the administration process should be complete within a year from the testator’s death. During this year, we expect interested parties not to interfere because the administration process might take a long time, depending on the complexity of the estate plan. During the executor’s year, the courts probably won’t recognize any claims against the executor. However, after the first year, people can raise claims for removal due to undue delay. The executor’s year essentially gives the executor a grace period, but it’s not legally enforceable

Ways Forward for Beneficiaries

Conflicts of interest regarding executorship are generally not sufficient grounds for executor removal. In fact, it’s very common for the executor to be a beneficiary of the estate themselves. Beneficiaries expect the executor to act objectively, ensuring their personal interest in the estate doesn’t impact the estate administration process. Any arguments or tension which may arise between executors and beneficiaries are also not grounds to remove an executor. By law, the executor does not need to be friendly with the beneficiaries; they simply have to administer the estate in a timely manner, with the best interests of the beneficiaries at mind.

It is often easier and faster to avoid executor removal during the estate administration process, however, removal is sometimes the only option in cases where the executor refuses to take action or causes undue delay. If you’re a beneficiary who is suffering at the hands of an executor, contact an experienced estate lawyer today to begin solving the problem sooner rather than later.

Have a question about this topic or a different legal topic? Contact us for a free consultation. Reach us via phone at 250-888-0002, or via email at info@leaguelaw.com.