Janet M. Henley Applicant And: Brian A. Henley First Respondent And: John J. Henley Second Respondent And: Christopher M. Henley Third Respondent Corrected Judgment: The text of the original judgment was corrected on February 27, 2019, v. a description of the correction is, 2018 NLSC 222

court crest IN THE SUPREME COURT OF NEWFOUNDLAND AND LABRADOR GENERAL DIVISION Citation : Henley Estate , 2018 NLSC 222 Date : November 7, 2018 Docket : 201501E14496 Between: Janet M. Henley Applicant And: Brian A. Henley First Respondent And: John J. Henley Second Respondent And: Christopher M. Henley Third Respondent Corrected Judgment: The text of the original judgment was corrected on February 27, 2019, and a description of the correction is appended. Before: Justice David B. Orsborn Place of Hearing: St. John’s, Newfoundland and Labrador Date of Hearing: November 1, 2018

Summary: Janet, Brian, John and Christopher Henley are the executors (since 2015) and administrators (since 2016) and beneficiaries of theirparents’ estates. Because of differences over the

interpretation of certain provisions of Alec Henley’s will and codicils, they are at animpasse over the distribution of certain assets of his estate. Janet Henley applied to Court for an order removing all four as executors andadministrators and appointing the Public Trustee as the administrator of both estates. Held – the application was dismissed. At this latestage of the administration of both estates, the timely completion of the administrations and the protection of the welfare of thebeneficiaries were best advanced by the Court’s providing directions on the disputed issues. Appearances: Nicholas J.G.

Avis, Q.C. Appearing on behalf of the Applicant Douglas W. Wright and Melissa M. Saunders On behalf of the First Respondent John A. Bruce On behalf of the Second and Third Respondents Authorities Cited: CASES CONSIDERED: Fleming v. Fleming, 2006 NLTD 112; Greeley Estate v. Greeley, 2016 NLCA 26; Powers v. Powers Estate(1988), (NL SC), 68 Nfld & P.E.I.R. 336 (Nfld S.C.T.D.) STATUTES CONSIDERED: Trustee Act, RSNL, 1990 c.

T-10 REASONS FOR JUDGMENT Orsborn, J.: INTRODUCTION issue [1] Because of a continuing failure to agree and the circumstances surrounding that failure, should Alec and Catherine Henley’sfour children be removed as the executors and administrators of their parents’ estates? background [2] Alec Henley died on February 21, 2013. Letters of Probate – a will and two codicils – were granted to Catherine Henley on

August 29, 2013. Catherine Henley died on June 14, 2015 without having completed the administration of her husband’s estate. Letters of Probate of Catherine Henley’s estate were granted on August 12, 2015 to her four children, Janet Henley, Brian Henley, John Henley and Christopher Henley. [1] On February 23, 2016, the children became co-administrators of Alec Henley’s estate. Although much has been accomplished in both estates, for some months now the children have been at an impasse over the implementation of some aspects of Alec Henley’s will and codicils.

Further, some distribution out of cash held in Catherine Henley’s estate has been stalled because of the disagreement. [ 3 ] Janet, opposed by Brian, John and Christopher, has asked the Court to remove all four executors and administrators and to appoint the Public Trustee to complete the administration of both estates.

She asserts that John and Christopher, in particular, are in an untenable position of conflict of interest, having allowed their position and interest as beneficiaries to take precedence over their responsibilities to the estate and to all the beneficiaries. [ 4 ] In a separate application, Brian has applied for the Court’s directions on specific questions concerning the estate of Alec Henley.

These questions address issues on which the four executors are at an impasse. [ 5 ] Following representations from counsel, I ruled that I would hear the removal application first and would provide a decision before the ‘directions’ application, currently scheduled for November 9. Of course, if the Public Trustee is appointed, the issues on which directions are sought will then become a matter for consideration by the Public Trustee. [ 6 ] The distribution of Alec Henley’s estate is governed by a will and two codicils.

As of his death, the estate was substantial and consisted of a variety of assets, financial and otherwise, including shares in a wholly-owned holding company, Carpasia Investments Inc. (“CI”). In turn, CI owned 50% of the common shares of Carpasia Properties Inc. (“CP”) a company which owns certain commercial and real estate assets in St. John’s. The other 50% of CP is owned by Brian through his own holding company.

Among the assets of CI is a shareholder’s loan receivable from CP – the amount is in dispute but it is in the range of $165,000-$183,000. [ 7 ] Clause 6(3)B of Alec Henley’s will leaves the CI shares to the four children, but in a proportion based on the evaluation of what are referred to in the will as “the Carpasia Investments Assets”.

The Carpasia Investments Assets (for greater certainty, excluding those Assets disposed of by the preceding paragraph 6(3)A of this my Will) shall be valued at their fair market value, the method of which valuation to be in the Discretion of my Executrix or Executors (all subsequent references to “value” in this paragraph 6(3)B to mean the value determined by that valuation), and the CARPASIA INVESTMENTS Shares shall be divided and distributed among my children JANET HENLEY-ANDREWS, BRIAN HENLEY, JOHN HENLEY and CHRISTOPHER HENLEY in such proportions so that my children JANET, JOHN and CHRISTOPHER share equally in the first THREE HUNDRED THOUSAND DOLLARS ($300,000.00) in value of the CARPASIA INVESTMENTS Assets and so that my children JANET, JOHN, CHRISTOPHER and BRIAN share equally in any surplus value of the CARPASIA INVESTMENTS Assets in excess of Three Hundred Thousand Dollars ($300,000.00), each of my forenamed children’s proportion of CARPASIA INVESTMENTS Shares to be delivered to and held by each of them … [ 8 ] This valuation calculation – and hence the share distribution – is one of the main issues on which the children are deadlocked. [ 9 ] John and Chris take the position that the CP assets held by CI (shares and loan receivable) and the liabilities of CI should be excluded from the evaluation of the CI Assets contemplated by the will.

There is also a peripheral - but hotly contested - disagreement over the amount of the CI shareholders loan receivable and whether or not a portion of it is owed directly to Alec Henley’s estate rather than to CI. [ 10 ] With respect to the shares in CP, Clause 6(3)D of Alec Henley’s will leaves these equally to Janet, Brian, John and Christopher (the four children are in agreement that the CP Shares can be directly distributed according to the direction in Alec Henley’s will, notwithstanding that the shares are in fact owned by his holding company CI): …my Executors shall cause to be surrendered, conveyed and transferred to each of my children JANET HENLEY-ANDREWS, BRIAN HENLEY, JOHN HENLEY and CHRISTOPHER HENLEY one-quarter each of the shares in CARPASIA PROPERTIES INC. held by CARPASIA INVESTMENTS INC. (which shares are hereinafter referred to as the “CARPASIA PROPERTIES Shares”) at the time of my death, to be his or hers absolutely, … [ 11 ] But the two codicils remove Brian from the bequest (this is not contested) and refer not to shares but to Alec Henley’s: 50% interest in Carpasia Properties regardless of anything aforesaid contained in that will, 50% of Carpasia Properties will be divided equally…to John Henley, Christopher Henley and Janet Henley in equal shares. [ 12 ] This wording in the codicils has given rise to a claim by John and Christopher, but not by Janet, that the bequest includes not only the shares of CP but also the shareholder loan from CI to CP referred to above. [ 13 ] On all of the deadlock issues, John and Chris argued for

interpretations that will benefit their interests as beneficiaries. [ 14 ] The impasse has led to a failure to transfer the CI shares and the CP “interest” to the beneficiaries and, apparently, to a failure to distribute cash now held in the estate of Catherine Henley. [ 15 ] Janet says that this conflict of interest and the resulting impasse has resulted in a situation that is adverse to the welfare of the beneficiaries. She points to John and Christopher as being the architects of the impasse. In her application she says, at paragraph 41 - “…they believe they have all the correct answers”.

Although it is to her financial detriment, Janet opposes the valuation and other positions advanced by John and Christopher. [ 16 ] The estates – particularly Alec Henley’s – were complex and involved numerous tax and other issues. From the date of their

appointment until sometime in 2016, the four executors/administrators accomplished much. But by late 2016, it was apparent that there were different views on a number of matters. Together with the estate counsel, they met on December 4, 2016. A number of matters were discussed. The minutes, in part: 2. Decision on using court or arbitration to determine any issues not resolved at the meeting • Brian and Chris prefer to see what the unresolved issues are before deciding to use court of [sic] arbitration. To be deferred to the end of the meeting. 6.

Transfer of CPI shares (50% ownership interest held by CII) to John, Chris & Janet. • Indirect gifts in the Will to be carried out by the Executors. • To the extent that the directors of CII are directed to do something by the shareholders that is not in the best interest of CII (the indirect transfers), the Shareholders of CII will indemnify the directors of CII for those actions. • Instructions in Will are to transfer shares in CPI to John, Chris and Janet in equal shares. Estate will facilitate the transfer to those beneficiaries as they direct.

Any cost of transaction to CII or the Estate would be borne by those beneficiaries and not CII or the Estate. • Pending tax advice to be contained by Brian that he will not be negatively impacted as a shareholder of CII.

Intent is that Brian should be kept whole. • Next steps: o Chris to contact Brophy today to set up a conference call early this week. o John, Chris and Janet to provide instructions to Brian Brophy to prepare an instruction letter setting out the reorganization plan for the transfer of the CPI shares and the Class D shares. o Letter should include an assessment of any adverse consequences to Brian Henley. 7.

Valuation of CII assets and the distribution of those shares to Brian, John, Chris and Janet. • Agreement of the beneficiaries that Winter Ave (assets and liabilities) is removed from assets of CII for the purposes of valuation (except for RDTOH). • Assets to include: o RDTOH account to be included as an asset at a discounted rate: ~$43,857.48; o Shares in CPI ($179,889.34) o Market Portfolio ($469,901.00) o Cash ($67,361.00) o CPI Shareholder Loan ($182,785.00) o Total $943,793.82 • Spreadsheet attached to minutes titled “Distribution of Common Shares in CII to Beneficiaries” sets out share distribution to each beneficiary. 8.

Director appointments for CII and CPI should agreement on the share transfer not be reached. • To be dealt with by shareholders at a duly called meeting of shareholders

Sale of Carpasian Road: • Executors are agreed that Tim Crosbie will be the listing agent. • Commission to be 5% • Listing term to be for 90 days. • Listing price: List for whatever price Tim Crosbie recommends but at least $559,900. • When to list: March 1, 2017, for the public, MLS listing, and when the 90 days would start, however, Tim Crosbie will have the listing privately as a January 1, 2017, for anyone he knows who might be interests in the property, but he will be the agent to personally show the property to the client, the private showings can happen while the personal property is still in the house.

Once listed publically [sic], all appointments for viewings must be made through Tim. • Floor price that the estate is prepared to accept: gross before real estate commissions, etc, of $525K. • Brian is to be the Executor to take the lead on the house sale and sign the listing agreement.

Once there is an offer, it is to come back to all executors for a decision. • No home inspection to be done by the Estate. • Janet authorized to spend up to $2000 on the house to increase the “street appeal” for the house. (three in favour of this, Chris opposed) • Not going to spend money on staging the house. • Once the selection of personal property has occurred, it will be the decision of each beneficiary if they wish to leave their selected items in the house or not when public showing start. • Any photographs which contain pictures which solely contain John (not including group family photos) will be removed and stores in the basement before the house is listed publically.

Late Additions to the Agenda: 19.

An interim distribution of cash to Janet, Brian and Chris to adjust for John’s receipt of the Manuels property. • Chris’ recommendation is that the Seamark portfolio (currently worth ~$1.6M) be liquidated starting on Monday, December 51, 2016. • As per agreement in August, confirmed that Chris has the discretion over the next week or so to liquidate the various assets as he judges prudent. • Once fully liquidated, the entire proceeds will be transferred to the CMH estate account at RBC. • $900,000 will be distributed equally to each of Brian, Janet and Chris in the amount of $300,000 each to adjust for the transfer of Manuels to John earlier this year, which property was valued at $300,000.

This distribution is to occur once the funds are deposited to the RBC account. [ 17 ] The four children each signed their ‘acknowledgement and agreement’ at the end of the minutes. [ 18 ] Much of what was agreed upon was implemented. The cash distribution from Catherine’s estate is one example. There was subsequent agreement on the process of the sale of the property at 40 Carpasian Road (Catherine Henley’s estate), leading to its successful sale in February 2018. However, according to the supplementary affidavit Janet filed on October 4, 2018: As of this date, the proceeds of the sale of 40 Carpasian Road, St.

John’s, which closed on February 28, 2018, have not been paid out to the beneficiaries of the Estate of Catherine M. Henley. Again, two of the Executors, John Henley and Christopher Henley, do not agree to disburse all or part of those proceeds. The sale proceeds of $487,381.28 were deposited into the Royal Bank non-interest bearing chequing account in the name of the Estate of Catherine M. Henley on March 6, 2018.

The current balance in that account is $643,199.70. [ 19 ] In January 2017, John took the position that the proper amount of the loan from CI to CP was not $182,785 (see minutes of December 4, 2016, item 7 above) but rather $165,285, and that part of the difference may in fact be owed directly to the Alec Henley estate rather than to CI. John’s email, in part: …I have been through the CI bank statements and Financial reports since inception to reconcile the CP shareholder loan and the CI books appear correct with a value of $165,285 vs the CP books showing $182,785. See

summary below. This has implications for CI

and each of us as shareholders. It appears Dad directly deposited ($8,750 and $12,500) in 2007 to CP and not through CI. Equally, a ($3,750) refund in 2002 is not recorded in the CI books although it is shown in the bank deposits. [ 20 ] This dispute over the differences in the loan amount led to numerous emails between the children, complete with copies of cheques, deposit slips, bank statements and journal entries, some dating back to 2002. [ 21 ] In May 2017, John wrote: Chris/Janet/Brian: At the Estate Meeting on December 04, 2016 the CI shares were allocated based on a legal

interpretation that only “Assets” were to be included in the calculation. The meeting minutes document the share percentages at that time. In that calculation, a CI Shareholder Loan to CP value of $182,785 was used based on Brian’s insistence that the CP books were correct and that the CI books, which showed the CP Loan value of $165,285 were incorrect. Subsequently, in sorting out the CI financial statements with Grant Thornton, Chris & I have determined that the CI Shareholder Loan value to Carpasia Properties shown on CI’s books is incorrect. The correct value is $165,285.

I requested CP on January 17, 2017 (email attached) to check their records to confirm our analysis. The email also asks for confirmation of the basis for a $3,750 cheque from CP to CI. CI has yet to receive a response. Attached is a revised analysis for the CI share distribution calculation. Please confirm that you agree with this adjustment. When 3 Executors confirm they agree CI will issue the new shares on this basis. (Bold type in original). [ 22 ] The “revised analysis” set out a new calculation of the CI Assets to be used for determining the distribution of shares in CI.

However, the revision not only adjusted the value of the CP shareholder loan, but it also eliminated from CI Assets the value of the CP shares ($179,889.34) agreed to at the December meeting and reduced the total assets by the amount of the liabilities on CI’s financial statements ($274,288.44). All told, John’s May 2017 revisions reduced the CI Asset valuation - for the purposes of clause 6(3)(

B) of the Will - from $943,793.82 at to $472,116.04. [ 23 ] This position resulted in the following changes to the CI Share distribution from that reflected in the December 4, 2016 minutes: % of CI Shares December 2016 May 2017 (per John) Janet 27.65% 30.3% Brian 17.05% 9.1% John 27.65% 30.3% Chris 27.65% 30.3% [ 24 ] Subsequently, in July 2017, Chris, supported by John, said: …I have reflected on the CP issue.

The codicil reads as follows: Item Two of my Codicil of May 6th, 2010 shall not be changed and thus my 50% interest in Carpasia Properties regardless of anything aforesaid contained in that Will, 50% of Carpasia Properties will be divided equally upon our deaths of Alec G. Henley and Catherine Henley to John Henley, Christopher Henley and Janet Henley in equal shares .

The Codicil specifically states that Dad’s 50% interest in CP is to be divided equally between Janet, John and me. From my perspective that interest includes the shareholder loan to CP; this has become more important as we look to the implementation of this element of the Will and Codicils and the ramifications. [ 25 ] The record indicates that the executors last met on September 22, 2017. A number of matters were discussed and some agreements were reached. Among the disagreements: 13.

Transfer of CPI shares (50% ownership interest held by CII) to John, Chris & Janet • Adrienne reviewed the opinion provided by McInnes Cooper on the three issues identified. • There was a discussion and disagreement regarding the

interpretation of the will and codicils and in particular if the 50% interest in CPI included the shareholder loan. • Sheri advised that, given disagreement over the

interpretation of the 50% interest, two options were available: 1. The majority of Co-executors could make a decision, with the individual in disagreement having the option of pursing a court challenge if desired. 2.

Where there is no majority decision, apply to the Court for direction. • Brian proposed that the co-executors get an independent assessment to determine the quantum of what is being argued about. • It was noted that arbitration would be another option, though this process would be costlier given the requirement to pay an arbitrator. • Chris indicated that he wished to consult with legal counsel before making a decision on whether to use arbitration or court. • Janet advised that she would be filing an application to have the Public Trustee appointed to complete the estates, but noted it would likely be January before the application was heard.

She expressed her willingness to withdraw the application before that time should this issue be resolved. • John and Chris feel shareholder loan should be included in CPI interest transferred to John, Chris and Janet. • Janet feels only CPI shares should be transferred to John, Chris and Janet. o Action : The Co-executors will reflect on whether they wish to use court or arbitration to resolve this impasse and communicate same to the group by October 2, 2017. [ 26 ] The issue of the CI Assets was deferred. An agreement was reached on a partial distribution of the Catherine Henley estate account: 16.

Partial Distribution • It was noted that there is approximately $623,000 in the CMH Bank account and a further approximately $140,000 in the AGH account. • Janet proposed the distribution of funds from the CMH account to the beneficiaries in the amount of $400,000 and there was discussion regarding same. o Action : Distribution approved (Chris dissenting). $100,000 will be distributed to each of the beneficiaries from the CMH account. [ 27 ] However, as noted previously, some $643,000, including the February, 2018 proceeds of the sale of 40 Carpasian Road, remains undistributed. [ 28 ] There is general agreement on what is needed to be done to complete the administration of the estates.

The following is from Brian’s affidavit: 42. As of the date hereof, the following matters remain to be completed with respect to the Alec G. Henley Estate: (

i) Transfer of the shares in CII owned by the Alec G. Henley Estate to myself, Janet, John and Christopher in accordance with clause 6(3)(

B) of the Alec G. Henley Will; (ii) transfer of shares of CPI that at the date of death were held by CII to Janet, John and Christopher in accordance with the Codicils; (iii) obtain final tax clearance from the Canada Revenue Agency; and (iv) distribution of the residue of the Estate to myself, Janet, John and Christopher, in equal shares in

accordance with clause 6(10) of the Alec G. Henley Will. 43. As of the date hereof, the following matters remain to be completed with respect to the Estate of Catherine Henley: (

i) Effect the transfer of Torbay MURB to myself, Janet, John and Christopher; (ii) effect the transfer of Bally Haly gold and country club shares to myself, Janet, John and Christopher; (iii) distribute the proceeds of sale of 40 Carpasian Road; (iv) distribute of any remaining cash; (

v) obtain tax clearance from the Canada Revenue Agency; and (vi) sort through and distribute the remaining personal effects and close storage unit. analysis [ 29 ] The legal framework for consideration of removal of an executor is well established. It is not a decision to be taken lightly. The objective of the court is, in the exercise of its discretion, to ensure that the estate is properly administered and that the interests and welfare of the beneficiaries are protected. [ 30 ] I refer to the comments of Green, CJTD, as he then was, in Re Adrian Fleming Estate , 2006 NLTD 112 at paragraphs 11-12 : 11.

The removal of a trustee or personal representative is something that will not be lightly undertaken. Before doing so, the court has to be satisfied that it is in the interests of the beneficiaries generally that removal should occur. As Lord Blackburn stated in Letterstedte v. Broers and Another [1881-85] All E.R. 882 (PC) at p. 887 (a case cited consistently by courts in this province) the court’s “main guide must be the welfare of the beneficiaries”.

If it is clear that the continuance of the trustee or personal representative in office would be detrimental to the execution of the trusts or the administration of the estate, the court may remove him or her. 12. The grounds upon which a trustee, and hence an executor administrator, may be removed include: positive misconduct amounting to abuse of trust; endangerment of the estate or trust property; want of honesty or reasonable fidelity; lack of proper capacity or ability to execute the duties of office; and conflict of interest. [ 31 ] See also Greeley Estate v.

Greeley , 2016 NLCA 26 where Fleming was cited with approval at paragraph 17. [ 32 ] I would add to the above that even when some circumstance may warrant consideration of removal, other factors may influence the exercise of the court’s discretion.

These factors may include the timing of the application relevant to the administration remaining, any available options, short of removal, for addressing the contentious issues, and the costs likely to be incurred if removal is or is not ordered. [ 33 ] Here, Janet, both in her application and through her counsel, has made it crystal clear that there are no allegations of misconduct, dishonesty or abuse of trust against any of the executors.

Neither is there any suggestion that property in either of the estates has been mismanaged or endangered. [ 34 ] The essential allegation, primarily against John and Christopher, is that they have allowed their position as beneficiaries to take precedence over their obligations as executors and are refusing to agree to facilitate the distribution and transfer of estate assets until the other two executors – or one of them – accede to their position.

Janet points to the refusal of John and Christopher to adhere to what she asserts to be the December 2016 agreement between the executors and to their backtracking from certain decisions taken at the meeting. [ 35 ] In these circumstances, is it appropriate for the Court to order the removal of all of the children as executors and administrators of theirs parents’ estates? It is apparent that there are no grounds to warrant removal of the executors of Catherine Henley’s estate.

Indeed, in Janet Henley’s application, filed on April 13, 2018, there is no reference whatsoever to any issue with the administration of Catherine Henley’s estate. It is only in one paragraph of Janet’s October 2018 supplementary affidavit that there is any reference to the administration of the estate of Catherine Henley, that being a delay in distributing some or all of the cash now in the estate. [ 36 ] Neither John nor Christopher filed an affidavit on this application.

Thus I am left with no explanation for their – according to Janet – refusal to effect further distribution out of Catherine Henley’s estate. [ 37 ] But be that as it may, the non-payment of some or all of the proceeds of sale - in and of itself - is not sufficient to warrant removal of the executors of Catherine Henley’s estate. [ 38 ] With respect to Alec Henley’s estate, the application calls for the removal of all four executors, including Janet herself. Other than the fact that Janet and Brian do not agree with John and Christopher, no grounds have been put forward for their (Janet’s and Brian’

s) removal. While one can understand why Janet may not wish to resign and leave John and Chris in the majority, it seems to me that it would be unusual, to say the least, for a court to order the removal of an executor when that executor’s conduct – in terms of management of the estate and decisions taken - has not been called into question. [ 39 ] The issues on which the children are deadlocked relate to the distribution of part of the estate of Alec Henley – the shares in CI and CP and the shareholder loan receivable held by CI.

[ 40 ] The positions now taken by John and Christopher on these issues are advantageous to them and to Janet as beneficiaries and contrary to the interests of Brian. However, Brian is opposed to the removal the executors, preferring a resolution by way of directions from the Court. [ 41 ] If a beneficiary is also an executor, there is clearly a potential for conflict of interest if decisions are made that will favour that beneficiary over another.

If, for example, an executor is making a decision within the discretionary authority of that executor, and that decision benefits the executor qua beneficiary at the expense of another beneficiary, a conflict of interest would be apparent. However, I do not consider disagreement over the

interpretation of a will to be of the same character as a preferential exercise of authority in the management of an estate. The fact that an executor is also a beneficiary should not preclude that individual from suggesting an

interpretation that is advantageous. [ 42 ] The fact is that all four executors disagree on the

interpretation of the clauses referred to earlier. I am not prepared to conclude that, since John and Christopher advance an

interpretation that is to their benefit, there is therefore a conflict of interest that supports their removal. [ 43 ] But I consider it more troubling that their

interpretation and positions have changed since they apparently agreed, in December 2016, to a certain valuation of the CI assets, a prescribed distribution of the CI shares, and an equal distribution of the CP shares, without reference to the shareholder loan. I say “apparently agreed” to avoid any suggestion that I am finding that the December meeting resulted in an agreement from which one or more of the executors could not resile.

That is an issue that may yet require adjudication. [ 44 ] The dispute over the amount of the shareholder loan – $180,785–$165,285 – and the characterization of two payments totaling $3,750 paid in 2002 would seem to be relevantly insignificant. But if in fact any agreement in December 2016 as to the amount of the loan was based on an error in the accounting records of CI and/or CP and/or Alec Henley, I cannot conclude that raising it after the meeting is, of itself, supportive of grounds for removal. [ 45 ] But the other issues raised are of a different character. They are issues not of record keeping but of

interpretation of the will and its codicils. These issues were known in December 2016 and were, according to the record, discussed in December 2016.

Decisions on these issues will have some effect on the distribution of the CI shares and on the value and makeup of the CP “interest” bequeathed to Janet, John and Christopher. [ 46 ] That these were raised after the ‘agreement’ reached in December and that, in May 2017, John and Chris took the position that no CI shares would be distributed unless their revised analysis was accepted is indicative of executors who are determined to advance their own interests over that of another beneficiary, in this case Brian.

As already noted, their position on all issues would advance the interests of Janet, John and Christopher to the prejudice of Brian. But to repeat, it is Janet, not Brian, who seeks to remove all four executors. [ 47 ] Viewed in isolation, the continued refusal of John and Christopher to complete the administration of Alec Henley’s estate other than on their terms, particularly in light of their ‘change of mind’ positions since December 2016, would suggest that removal be seriously considered. [ 48 ] But, all of the circumstances must be taken into account.

What follows is my consideration of those circumstances. [ 49 ] The removal of all four executors when the conduct of only two is challenged is a result that should be avoided if at all possible. (I add that, despite raising the question, I was not pointed to any authority to suggest that a court, in fact, could remove an executor in an absence of any ground relating to the conduct of that executor). [ 50 ] Further to this, the beneficiary prejudiced by the positions taken by John and Christopher is Brian.

Brian is opposed to the removal of the executors. [ 51 ] To date, none of the beneficiaries has been prejudiced directly by the impasse. No management decisions have been taken contrary to a beneficiary’s interest and no assets of the estate have been endangered. The prejudice to the beneficiaries – all of them - has been the delay in the administration of the estate, the cost of legal opinions on the disputed issues, and the continued hostility and friction between the executors making the impasse ever more intractable. [ 52 ] The deadlock requires the resolution of the following: 1.

Whether the CP shares, the CP loan and/or the CI liabilities are included in the valuation of the Carpasia Investments Assets pursuant to Alec Henley’s will. 2. Whether the “50% interest in Carpasia Properties” in the codicils includes the CP loan payable to CI. Resolution of these issues requires an

interpretation of the will and codicils and perhaps a determination of whether the December 4, 2016 meeting resulted in a binding agreement on one or more of these issues. 3.

The amount of the CP loan payable to CI and whether or not there is an amount owed directly to the estate of Alec Henley rather than to CI. [ 53 ] Resolution of this issue would require consideration of the records of CI, CP, and Alec Henley, and perhaps a determination of whether the December 4, 2016 meeting resulted in a binding agreement on the issue. [ 54 ] These issues are all that remain after years of complex administration of the two estates. Resolution of these issues can, in my view, be accomplished through Brian’s ‘directions’ application presently before the Court.

Other than perhaps on the loan amount issue and, conceivably, on the binding nature of the December 4, 2016 decisions, I would expect that the other issues – being issues of

interpretation - would require little, if any, evidence. For a comment on the relevance of other options for resolution in the context of a

request to remove an executor, see Powers v. Powers Estate (1988), (NL SC), 68 Nfld & P.E.I.R. 336 (NfldS.C.T.D.). [55] Appointing a trustee would expose the estate to the costs of administration charged by the Public Trustee according toregulation – 8% of the “capital assets” of the estate plus other fees and expenses. Further, I consider it quite likely that, given thedifferences of opinion and the hostility between the beneficiaries, the Public Trustee would himself wish to seek direction from the Courton the issues on which the beneficiaries are deadlocked. [56] Alec Henley was an experienced businessman.

It was his clear intention that if his wife Catherine Henley could not completethe administration of his estate, his four children would do so. Catherine Henley signaled her similar intention. With four executors, andwhere there is a provision in the wills for majority decision -making, deadlock could easily have been anticipated. One would expectthat the Henley parents, with their experience, would be aware of

section 25 of the Trustee Act, RSNL, 1990 c. T-10, which contemplatesthat an executor may seek the court’s direction on a question on the management or administration of an estate.

I consider it highlyunlikely that either parent contemplated or intended that differences of opinion would be resolved by passing responsibility foradministering the estates to the Public Trustee. conclusion [57] After considering all of the circumstances, I am not persuaded that it would be an appropriate exercise of the Courts discretionto remove the executors or administrators from either estate. [58] Brian’s application for directions will proceed. [59] I will defer a decision of costs on this application pending further submissions after completion of the directions proceedings inthis Court. _____________________________ David B.

Orsborn Justice A P P E N D I X Correction made on February 27, 2019: 1. On page 3, paragraph 2, the date of granting of Letters of Probate of Catherine Henley’s estate being April 12, 2015, is corrected toAugust 12, 2015.