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Can an Executor be Removed for Improperly Dealing with an Estate?

By Wills & Estates Team (posts)

In most Estates, there is no reason to fault the Executor, but one who abuses his/her power, causes harm to the Estate, or fails to perform duties properly can warrant removal by the Court.

Sometimes beneficiaries may feel they are at the mercy of this egregious Executor, but in fact beneficiaries have significant rights, and the law offers them powerful remedies. The Court may remove an Executor (or Administrator) for many reasons, which most commonly fall into one or more of the following categories:

  1. Misconduct;
  2. Conflict of interest, particularly where the conflict has not been disclosed to and consented to by the beneficiaries;
  3. Misuse of estate assets; and,
  4. Lack of even-handedness between the beneficiaries.

The Executor is in a position of trust and, as such, must demonstrate fidelity to the interests of the estate, and avoid conflicts of interest in the execution of his/her duties. The duty of Executors to the Estate is a fiduciary duty, which is the highest and most onerous duty known to law.

A survey of recent case law discloses many instances where the Court punished Executors for their improper actions. Executors were removed by Court Order in:

  • Ching Estate (Re) 2016 BCSC 1111, where the Executor had improperly appropriated estate assets for her own use, and was in a conflict of interest in her dual roles as Executor and beneficiary.
  • Kolic Estate, Re 2016 BCSC 1312, where the Executor had aligned with one of the beneficiaries during a dispute amongst the beneficiaries.
  • Kyle Estate v. Kyle 2016 BCSC 855, where the Executor had failed to distribute the funds equally to the beneficiaries, failed to include a joint asset as an estate asset, and co-mingled estate assets with his personal assets.
  • Watson v. Strong 2016 BCSC 1897, where the Executor had obstructed the proper administration of the estate, requiring the estate to spend money on legal fees that would have otherwise gone to the beneficiaries, and failing to apply for the Principal Residence property tax exemption, which would have saved the estate $60,000.
  • Yeh v. Yeh Estate 2016 BCSC 1550, where the Executor was in a conflict of interest – she had taken the position that a parcel of real property, which according to the Will was to go to the beneficiaries, should in fact go to her.
  • Dirnberger Estate 2016 BCSC 439, where the Executor had failed to distribute the Estate four years after probate and had acted in a hostile manner towards the other beneficiary.
  • Kajaks Estate 2016 BCSC 651, where the Executor had delayed the Administration of the Estate in hopes that the residuary beneficiaries would agree to a variation of the Will, to the benefit of his children.
  • Browne v. Brown Estate 2014 BCSC 656, where the Executor had taken estate assets and made payments and loans without properly accounting for the funds.

As these cases demonstrate, once the Court determines that an Executor has acted inappropriately, the Court may, where circumstances justify, go so far as to remove the Executor. The Court’s paramount concern in making this determination is the welfare of the Estate and its beneficiaries.

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