A recent case involving the estate of Canadian artist and figure skating legend, Toller Cranston (“Toller”), highlights the importance of estate planning for artists. Administering posthumous intellectual property can be complex and without guidance from the testator, disputes will often arise between trustees and the estate’s beneficiaries due to competing interests.
Toller died in 2015 while living in Mexico. He left no will. Toller was a prolific artist and his estate included many original works of art. He was survived by his two brothers, Goldie Cranston (“Goldie”) and Guy Cranston (collectively, the “Respondents” in the passing of accounts application) and his sister, Phillippa Baran (“Phillippa” or the “Estate Trustee”). All three siblings were declared Toller’s valid heirs and Phillippa was appointed his estate trustee in both Mexico and Ontario. Phillippa brought an application to pass her accounts as Estate Trustee (in response to a motion brought by Goldie to compel her to pass her accounts). Prior to the application being heard, the Respondents brought a motion seeking to remove her as Estate Trustee and have an estate trustee during litigation (“ETDL”) appointed.
The Respondents were concerned with the lack of transparency concerning estate assets, and the sum of legal fees paid from the estate in addition to the large sum Phillippa sought from the estate as reimbursement for expenses. However, their main objection was that Phillippa would not distribute the estate’s original artwork in specie but was selling the art through galleries. The Respondents alleged that Phillippa was choosing her own interests over the interests of the beneficiaries.
Phillippa took the position that she was acting in the best interests of the estate by carefully managing the estate’s art inventory to prevent the market from being flooded with Toller’s original artworks. Additionally, the beneficiaries were not entitled to in specie distributions but only the proceeds of the sale of the artworks. As the estate administration was almost completed, appointing an ETDL would be a waste of time.
The court found in favour of appointing an ETDL. While not deciding on the in specie distribution issue, Master Fortier found that in the majority of cases where the estate trustee is in a position of conflict concerning the estate’s administration, an ETDL will be appointed. Referencing the applicable case law, Master Fortier noted that only in cases where an estate is simple and straightforward, will the court avoid appointing an ETDL. Referring to this estate as neither and worried about the increasing legal costs the dispute was generating, he appointed a neutral ETDL.
The estate’s administration was hampered by the lack of a will and the tension between immediately realizing estate’s assets versus long term investments such as licencing deals. Artists and writers who create original artworks would benefit from estate plans that provide direction to their estate trustees about how they wish their posthumous intellectual property be managed, valued, and disbursed. Administering an estate with original artistic works is difficult and guidance from creator of those works would be invaluable.