This blog post was written by Mohena Singh, Associate at Fasken LLP.
An important question a person has to answer when planning their estate is, “who will be the estate trustee?” Sometimes this decision is taken lightly or a person may gravitate towards an obvious answer – “my spouse” or “my children”. What may seem like an easy decision can become costly and delay the administration of the estate if the appropriate person or persons are not chosen. What happens if estate trustees do not get along or cannot agree when making decisions?
The Ontario Court of Appeal recently heard a case, Kasanda v. Sartarelli[1], where two estate trustees brought applications to have the other removed because they could not agree as to how the debts of the estate would be paid. The deceased appointed his children as estate trustees along with his solicitor. In theory, it would be a simple estate to administer as there were only two assets – a rental property and proceeds of a joint account. The rental property was bequeathed to the daughter and the joint account, which was joint with the son, was bequeathed to the son.[2] The issue that caused disagreement between the siblings was how the debts associated with the estate, such as income tax, probate fees, and funeral costs, would be paid as there were limited assets of the estate.
The deceased’s solicitor, and third estate trustee, advised that the assets should abate and that the debts should be borne pro rata in relation to the value of the assets bequeathed to each sibling. This would mean that the majority of the debts (over 80%) would be paid by the daughter, as the rental property’s value was more than that of the joint account. The daughter disagreed with this method of determining the payment of debts, which in turn delayed the filing of the tax return and the payment of income tax. This also caused a significant delay in the administration of the estate along with a breakdown of the relationship between the siblings.
The application judge found that an estate trustee could only be removed “on the clearest evidence that there is no other course to follow…and that past misconduct may justify removal if it is likely to continue in the future.” The application judge concluded that the daughter had preferred her own interests over those of the estate and had obstructed the estate’s proper administration while the son had acted reasonably. Therefore, the application judge removed the daughter as estate trustee.
On appeal, the court found that the decision to remove an estate trustee is entitled to a high level of deference and as such, they would only intervene if the court found a clearly identifiable error by the application judge, which in this case there was none. As such, the appeal was dismissed.
In the court’s reasoning as to why the daughter should be removed as estate trustee, they highlighted the fact that while she claimed the decision regarding the payment of debts was unfair, she refused to address the debt concerns for two years. She also did not obtain a second legal opinion when she disagreed with the recommendation that was made by the deceased’s solicitor. But most importantly, the court found that the central reason for the daughter’s removal was because she was insistent that the deceased treated her and her brother inequitably while he was alive and because of her grievances over what she felt was inequitable treatment in the distribution of the estate, she failed to prioritize the interests of the estate over her own.
Understanding family dynamics is an important factor in the estate planning process. Estate planners should ask their clients whether the chosen individuals would be able to agree on various matters regarding the administration of the estate. The type of decisions estate trustees may be expected to make should also be discussed with the testator, such as how debts will be paid and who will bare the liability of paying them. Individuals should also be mindful of the potential for a conflict of interest where the named estate trustees are also the beneficiaries of the estate. If these discussions were had in this case, it may have prevented the costly delay in the administration of the estate, but more importantly it could have saved a sibling relationship.
Thank you for reading.
[1] 2025 ONCA 27.
[2] The court did not make a finding with respect to whether there was a right of survivorship over these proceeds.
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