Bryant Estate v Stuart, 2021 SKCA 54

Court of Appeal for Saskatchewan Docket: CACV3494 Citation: Bryant Estate v Stuart , 2021 SKCA 54 Date: 2021-04-07 Between: The Estate of Franklin James Bryant Appellant (Applicant) And Dorothy Stuart, the Estate of Alice Marie Bryant, and Automatic Amusements Ltd. Respondents (Respondents) Before: Richards C.J.S., Caldwell and Kalmakoff JJ.A. Disposition: Appeal allowed Written reasons by: The Honourable Chief Justice Richards In concurrence: The Honourable Mr. Justice Caldwell The Honourable Mr.

Justice Kalmakoff On appeal from: QBG 679 of 2019, Regina Appeal heard: October 7, 2020 Counsel: Sean Watson for the Appellant Turner Ralston for the Respondents Richards C.J.S. I. Introduction [ 1 ] The late Franklin Bryant [Franklin] was a beneficiary under his mother’s will. Franklin’s executor had concerns about how the mother’s estate had been administered. This led Franklin’s estate to ask a Queen’s Bench Chambers judge to require the executrix of the mother’s estate to provide an accounting.

The Chambers judge declined to make the order requested on the basis that there was no evidence of misconduct in the administration of the estate. [ 2 ] Franklin’s estate appeals from the decision of the Chambers judge. It submits that she applied the wrong test in deciding whether to order an accounting and, as well, misapprehended some aspects of the record. [ 3 ] As explained below, I agree with the central argument advanced by Franklin’s estate and would allow this appeal. An accounting should have been ordered. II.

BACKGROUND [ 4 ] Alice Bryant [Mother] and James Bryant [Father] had four children: Franklin, Dorothy Stuart [Dorothy], Robert Bryant [Robert] and William Bryant [William]. [ 5 ] The Mother and the Father were shareholders in a corporation called Automatic Amusements Ltd. [Automatic]. [ 6 ] It is common ground that the Mother and the Father intended their children to become equal shareholders in Automatic. [ 7 ] The Father died in 1998. [ 8 ] The Mother died in 2015. Her will provided that her house in Regina was to go to William and her cottage in the Qu’Appelle Valley to Dorothy and William.

Each of her grandchildren was to be given $2,000. The residue of her estate was to be divided equally among her four children – Franklin, Dorothy, Robert and William. [ 9 ] The Mother’s will named Dorothy as her executrix. Her estate did not go through probate. [ 10 ] Over time, there were changes in the ownership of the shares of Automatic apparently aimed at implementing the goal of equal ownership by Franklin, Dorothy, Robert and William. However, that story is only partially revealed by the record.

Profile reports from the Corporate Registry show the Mother as being the only shareholder (holding two Class A shares) in April of 2017, February of 2018 and November of 2018. A profile report dated March of 2019 shows each of Franklin, Dorothy, Robert and William holding one Class A share. The Mother is not listed as a shareholder in that report. [ 11 ] Franklin died in 2017. The administrator of his estate, his son Christian Bryant [Christian], had concerns about how the Mother’s estate had been handled.

He understood that Franklin was to have received a share of her estate and saw the resolution of his questions as being important to the completion of his duties in relation to Franklin’s estate. [ 12 ] Christian avers that he asked Dorothy many times for a copy of the Mother’s will but that she refused to provide it.

He says that the only distribution made from the Mother’s estate was $1,000 each that he and his siblings received as part of Franklin’s inheritance from the Mother’s estate. [ 13 ] All of this led Christian, as administrator of Franklin’s estate, to file a certificate of pending litigation against land owned by

Automatic and to bring an originating application in the Court of Queen’s Bench. In that application, the estate sought the following relief: a. An order pursuant to section 47(1) or 14(1) of The Administration of Estates Act that Dorothy Stuart produce the Last Will and Testament of [the Mother]; b. In the alternative, an order pursuant to section 47(2) of The Administration of Estates Act that Dorothy Stuart be ordered to attend the Court of Queen’s Bench for questioning relating to The Last Will and Testament of [the Mother]; c.

An order pursuant to section 14(2) of The Administration of Estates Act that Dorothy Stuart be removed as Executor of the Estate of [the Mother]; d. Further, and in the alternative, an order under section 15(1) of The Administration of Estates Act that the Applicant be appointed the Administrator of the Estate of [the Mother] and be granted letters of administration; e.

Further, and in the alternative, that Dorothy Stuart provide a full accounting of the Estate of [the Mother] pursuant to section 35(1) of The Administration of Estates Act . [ 14 ] In reply, Dorothy filed an affidavit wherein she averred, among other things, that (

a) Christian had never asked her directly for a copy of the Mother’s will, (

b) the Mother, by careful planning, had structured her estate so that no assets had to be processed through it, and (

c) Franklin’s Automatic share had no value. III.

THE DECISION UNDER APPEAL [ 15 ] We are told that, at the outset of the hearing in the court below, Franklin’s estate abandoned its claims for any type of relief except an accounting. [ 16 ] In her decision, the Chambers judge began by noting that a copy of the Mother’s will had been provided to Franklin’s estate just before the Chambers hearing and that, as a result, she did not have to deal with the feature of the application asking for production of the will. [ 17 ] The Chambers judge then turned to the request that Dorothy be removed as executrix of the Mother’s estate. She refused to make that order.

Her decision on that point is not under appeal. Indeed, it is common ground between counsel that this aspect of the estate’s application was one of the requested grounds of relief that was abandoned at the outset of the Chambers hearing. [ 18 ] As for the matter in issue here, the question of an accounting, the Chambers judge began by commenting that s. 35(1) of The Administration of Estates Act , SS 1998, c A-4.1 , the statutory authority referenced in the notice of application filed by Franklin’s estate, applied only in situations where there had been a grant of letters probate or letters of administration.

As such, she found it to be inapplicable. [ 19 ] The Chambers judge then went on to observe that the Court of Queen’s Bench has the inherent jurisdiction to order an accounting. She declined, however, to act on that authority, writing as follows: [ 20 ] Just because the court has the inherent jurisdiction to order an accounting, does not mean it should. I want to be clear that there is no evidence before me that there has been misconduct such that an accounting is necessary .

The applicant believes that an accounting will show what has happened to the Corporation’s assets but, as I have indicated, the assets of the Corporation did not pass through the estate of [the Mother]. At the hearing, it became apparent that the applicant was seeking information on his late father’s share in the Corporation that, upon his death, became part of his estate. An accounting of the administration of [the Mother’s] estate will not yield the type of information the applicant seeks.

To the extent that the applicant wants information on how the executrix disbursed the bequests, much, if not all, of that was set out in her affidavit. (Emphasis added) [20] Franklin’s estate appeals from that decision. IV. Analysis [ 21 ] As noted, the question in this appeal is whether the Chambers judge erred in declining to order an accounting of the administration of the Mother’s estate. In this regard, Franklin’s estate now relies exclusively on s. 55 of The Trustee Act, 2009 , SS 2009, c T-23.01 [ The Trustee Act ], a statutory provision not drawn to the attention of the Chambers judge.

Dorothy makes no objection to Franklin’s estate shifting gears in this way, and, as a result, the issue before the Court is whether, on the facts here, Franklin’s estate is entitled to an accounting pursuant to s. 55 . [ 22 ] Before turning to s. 55 of The Trustee Act , it is useful to note that, in the normal course of the administration of an estate, the person named by a will as the executor will apply for letters probate as per The Administration of Estates Act . Under that Act, an executor must render an account of the administration of the estate within two years of the grant of the letters probate.

Section 35 says this: 35(1) An executor or an administrator must render a just and full account of the executorship or administration within two years after the grant of letters probate or letters of administration .

(2) The oaths to be taken by executors and administrators, the bonds or other security to be given by administrators, and the letters probate and letters of administration must set out the duty of the executor or administrator described in subsection (1).

(3) An executor who is also a trustee under the will must account for the trusteeship in the same manner as the executor must account with respect to the executorship. (Emphasis added) [ 23 ] Section 36(1) goes on to provide that an executor may apply for an order discharging him or her without passing the accounts. [ 24 ] Division 5 of

Part 16 of The Queen’s Bench Rules , entitled “Accounts”, also deals with the obligations of executors to provide an accounting. Rule 16-49 speaks to an executor filing accounts for passing: 16-49(1) A personal representative may file accounts with the local registrar at any time for passing.

(2) Subject to rule 16-57, a personal representative shall file the accounts for passing: (

a) when the administration of the estate has been completed; (

b) within 2 years after the issue of the grant unless that time is extended by order; (

c) when the personal representative desires to be discharged; or (

d) when the personal representative desires to substitute security other than that furnished when the grant was made, or by subsequent order, or to have the amount of the security reduced. [ 25 ] Rule 16-50 deals with the situation where a personal representative fails to file accounts or when there is an allegation of negligence or wasting of the estate: 16-50(1) If a personal representative fails to file the accounts as required by rule 16-49, any person interested in the estate may serve the personal representative with notice requiring filing of the accounts within 30 days.

(2) If a personal representative does not file accounts after being served with notice, the person serving the notice may apply by notice of application for an order compelling filing of the accounts.

(3) A person interested in the estate may at any time apply for an order requiring a personal representative to file accounts if it is alleged by affidavit that a personal representative is negligent or is wasting the estate.

(4) On the return of a notice of application, the Court may order that the personal representative file the accounts within a time to be stated. [ 26 ] The broad or overall effect of these features of The Administration of Estates Act and The Queen’s Bench Rules , therefore, is the creation of a scheme that contemplates an executor applying for letters probate and then, when the administration of the estate is completed, or within two years or such further time as extended by court order, filing accounts with the Court of Queen’s Bench for passing.

If the executor fails to file the accounts as required, or if there is an allegation that the executor is negligent or wasting the estate, a beneficiary may apply for an order compelling the executor to file the accounts. [ 27 ] The final relevant feature of the statutory landscape, the feature now relied on by Franklin’s estate, is The Trustee Act .

Section 2(

h) of that Act defines “trustee” to mean, among other things, “an executor or administrator”. Without making any reference to The Administration of Estates Act , or the provisions therein with respect to the obligations of an executor to account, s. 55 of The Trustee Act provides as follows: 55(1) On the request of a beneficiary of the trust, or the beneficiary’s property attorney or property guardian, a trustee shall provide an accounting to the beneficiary.

(2) If a beneficiary of the trust , or the beneficiary’s property attorney or property guardian, has been unable to obtain an accounting from the trustee in accordance with subsection (1), the beneficiary of the trust , or the beneficiary’s property attorney or property guardian, may apply to the court for an order directing the trustee to provide an accounting to the court or to the beneficiary .

(3) Notwithstanding anything to the contrary in the terms of a trust, if a beneficiary of the trust or other interested person has requested information concerning the accounts of a trustee, and the trustee has refused to comply with the request in a reasonable and timely manner, the court may order the trustee to pass accounts in accordance with

section 54. (Emphasis added) [ 28 ] In the circumstances here, and as noted above, Dorothy administered the Mother’s estate without applying for letters probate. Where does all of that leave her and Franklin’s estate? Let me begin by noting that they both accept the Chambers judge’s determination that the obligation to account prescribed by s. 35(1) of The Administration of Estates Act has no application here because it speaks of an executor rendering an account “within two years after the grant of letters probate”, and there was no grant of letters probate in the circumstances at hand.

Accordingly, with neither this point nor any other aspect of s. 35 having been put in issue, I will not comment further on that section. [ 29 ] By way of additional clarification, I note as well that Franklin’s estate does not attempt to rely on The Queen’s Bench Rules . In other words, Franklin’s estate has not suggested that, regardless of whether s. 35 of The Administration of Estates Act is applicable, Rule 16 - 50 nevertheless entitles it to apply for an order compelling Dorothy to provide an accounting.

As a result, I will not explore that issue either and will leave to another day any questions that might arise in relation to the applicability of Rule 16-50 in circumstances like those involved here. [ 30 ] A third question not raised in these proceedings is whether a party in the position of Franklin’s estate can rely on the inherent

jurisdiction of the Court of Queen’s Bench to secure an order for an accounting. I flag that point only for the purpose of further confirmingwhat has, and what has not, been put on the table for decision in this appeal. [31] With all of that said, I return now to s. 55 of The Trustee Act and the argument made by Franklin’s estate that, by virtue of thatsection, it is entitled to an accounting. [32] The Trustee Act is a provincial statute and, as a result, its

interpretation must respect s. 2-10 of The Legislation Act, SS 2019,c L-10.2. It reads as follows: 2-10(1) The words of

an Act and regulations authorized pursuant to

an Act are to be read in their entire context, and in their grammaticaland ordinary sense, harmoniously with the scheme of the Act, the object of the Act and the intention of the Legislature.

(2) Every Act and regulation is to be construed as being remedial and is to be given the fair, large and liberal

interpretation that bestensures the attainment of its objects. See also Rizzo & Rizzo Shoes Ltd. (Re), (SCC), [1998] 1 SCR 27 at para 21. [33] In broad terms, it is entirely appropriate to understand s. 55(1) as imposing an unavoidable obligation on a trustee to provide anaccounting. That kind of duty is consistent with, and reflects, the fundamental nature of the relationship between a beneficiary and atrustee. Being able to hold a trustee to account ensures that the trustee discharges its fiduciary obligations.

Justice Brown referred to all ofthis in Valard Construction Ltd. v Bird Construction Co., 2018 SCC 8, [2018] 1 SCR 224: [17] Because a trust divides legal and beneficial title to property between a trustee and a beneficiary, respectively, the “hallmark”characteristic of a trust is the fiduciary relationship existing between the trustee and the beneficiary, by which the trustee is to hold thetrust property solely for the beneficiary’s enjoyment. As a matter of law, this fiduciary relationship, in turn, impresses the office of trusteewith certain duties.

In particular, three duties have been recognized in Canadian law as fundamental. First, a trustee must act honestly andwith that level of skill and prudence which would be expected of the reasonable person of business administering his or her own affairs.Secondly, a trustee cannot delegate the office to another. And thirdly, a trustee cannot profit personally from its dealings with the trustproperty or with the beneficiaries of the trust. [18] Correspondingly, the beneficiary of a trust has a right to hold the trustee to account for its administration of the trust property andto enforce the terms of the trust.

Absent such a right, both the trustee’s obligation to act in accordance with its fiduciary duty and the termsof the trust itself would be substantially unenforceable.

In effect, the trustee would hold beneficial as well as legal ownership of the trustproperty — which would, of course, be contrary to the division of legal and beneficial ownership upon which the trust relationship ispremised. (Footnotes omitted) [34] None of this means, of course, that s. 55 of The Trustee Act can or should be read as requiring that a beneficiary who makes anunreasonable or vexatious request for an accounting must be accommodated by a trustee by virtue of s. 55(1) or that a judge must make anorder to oblige a trustee to act on such a request when faced with an application pursuant to s. 55(2).

Nevertheless, an accounting must notbe lightly denied. The root fact, as per the clear language of s. 55(1), is that a beneficiary is entitled to an accounting as a matter of courseon making a reasonable request. He or she has no obligation to show cause or present a justification for that request. This is thefundamental starting point of any proceeding pursuant to s. 55(2). [35] I would not presume, in this decision, to attempt to identify all of the circumstances that might make a request for an accountingunreasonable, but it may be helpful to mention three.

First, a request that is made too closely on the heels of another accounting might beunreasonable on the basis that not enough time has passed, or the trustee has not had enough opportunity to deal with the trust property, towarrant an additional accounting. Second, the state of affairs concerning the administration of a trust might make a request for anaccounting unreasonable. Thus, for example, if the administration of an estate is on the very brink of being completed, it might beunreasonable to request an accounting until matters have been finally wrapped up.

Third, at some point in time, it may become simply toolate in the game for a beneficiary to properly expect an order requiring an accounting. This might be the case, for instance, if a request foran accounting is made many years after the time by which it might have been expected that the administration of an estate would havebeen completed. In other words, the timeliness of a request for an accounting might be a factor to be considered in deciding whether therequest is unreasonable.

Every determination of reasonableness will, of course, always be fact and context specific. [36] In the result, therefore, and contrary to Dorothy’s position, a beneficiary has no obligation under s. 55 of The Trustee Act toshow cause, in the sense of establishing negligence or possible wrongdoing by the trustee, before an accounting can or should be ordered.The right to obtain an accounting flows not from the fact of demonstrated or suspected wrongdoing by the trustee, or other such concerns,but from the nature of the trustee–beneficiary relationship itself, i.e., a beneficiary is entitled to an accounting simply by virtue of being abeneficiary. [37] There has been little judicial consideration of s. 55 of The Trustee Act.

The leading Queen’s Bench decision in this area appearsto be Tinline v Larente, 2013 SKQB 167, 420 Sask R 81 [Tinline]. In that case, a Chambers judge dealt with an application for an orderrequiring the executor of an estate to provide an accounting. The executor had also been the personal and property attorney of the testatorfor a period of time during the testator’s life. The application was based on s. 18 of The Powers of Attorney Act, 2002, SS 2002, c P-20.3,The Queen’s Bench Rules, s. 55 of The Trustee Act, and the inherent jurisdiction of the Court of Queen’s Bench.

In dismissing theapplication, the Chambers judge observed that there was no reason that the estate could not be concluded and a final accounting providedin the near future.

If the estate was not so concluded, or a satisfactory interim report provided, the Chambers judge said the matter couldbe brought back before him. [38] For present purposes, the most significant part of Tinline is what the Chambers judge said about what must be establishedbefore an accounting will be ordered: [22] Although it is my view that it is not always necessary to prove that there has been a default by the trustee before an accounting is

ordered, an accounting should not be ordered if no cause is shown. In this case, the applicant has failed to meet that burden. He has asked for an order that the respondent account despite the fact that there is no evidence she exercised her authority except to carry out very limited and specific instructions from the grantor. There is no evidence she exercised her authority after he became incompetent.

A property attorney should not be required to provide an accounting for a period when her power was neither effective nor exercised, and in the absence of evidence that she had exercised her authority other than as instructed and in what was essentially an agency capacity. I note on this point the reasoning in Fair v. Campbell (Estate), 3 E.T.R. (3d) 67, [2002] O.J. No. 5926 (QL) (Ont. Sup. Ct.), at paras. 29 - 33 . [23] Similarly, there is insufficient evidence that the respondent has failed to carry out her duties as executrix.

The applicant deposes that he believes the Statement of Property grossly undervalues the estate. However, he does not suggest that the ongoing payments of $3,500 a month for the taxi business have not been properly credited to the estate. He says that the Statement of Property does not fully list his father’s “physical assets”, but identifies only antique furniture and computer equipment. Her evidence as to how those items were dealt with was not disputed by the applicant.

The executrix has also explained her management of Rodney’s bank accounts. [24] Given the lack of evidence of misconduct, the relatively brief period since the issuance of the Letters Probate, and the evidence that the applicant refused to provide financial records to the respondent, I am not prepared to order an accounting at this time. That said, it is common practice for executrix to provide an interim report to beneficiaries.

It is difficult to understand why the executrix would not be willing to provide such a report to a sole beneficiary in relation to what appears to be a simple estate, unless she expects to conclude her administration and thus report in the very near future. [ 39 ] I agree with Tinline to the extent it rejects the idea that the obligation on a trustee to provide an accounting as per s. 55(1) is absolute and to the extent it rejects the notion that a judge faced with an application pursuant to s. 55(2) must reflexively make an order for an accounting if a trustee has failed to respond to a request for same.

The Legislature cannot be taken to have intended that a request for an accounting, no matter how ill-timed or vexatious, must be honoured by a trustee or enforced by court order. However, as indicated, it is not necessary for a beneficiary to show cause as a precondition to obtaining an order pursuant to s. 55(2).

A judge should make an order for an accounting under that subsection if a beneficiary has made a request that is reasonable in light of all of the relevant circumstances and that request has been denied or not acted upon by the trustee. [ 40 ] In this case, it was entirely reasonable for Franklin’s estate to request an accounting. The following points inform my conclusion in this regard: (

a) The Mother died in November of 2015. Her estate was not probated. (

b) Christian averred that, notwithstanding many requests for a copy of the Mother’s will, Dorothy had refused to provide one. Dorothy responded by saying only that Christian had not asked “directly” for a copy of the will. (

c) Dorothy averred that, prior to his death, Franklin had “received funds as a named beneficiary, or joint account holder”. However, she also said, “I am not aware of the particulars of these payments or amounts”. (

d) Dorothy explained that the bulk of the Mother’s assets were “jointly held” and thereby were “automatically transferred to the name of the individual with who the assets were jointly held”. But, she provided no detail as to the nature of those assets or information about the individuals who had held them jointly with the Mother. (

e) The only other bequests distributed to beneficiaries, according to Dorothy, were $2,000 for each grandchild, an amount that she averred had been personally delivered to Christian, and $1,000 for each of several designated beneficiaries (who were not identified), including Christian and his siblings. These funds were said to have come from an investment when it had matured.

Christian takes issue with this and avers that he and his siblings received only $1,000 each. [ 41 ] When these considerations are weighed together with the fact that, as per s. 55(1) of The Trustee Act , Franklin’s estate is entitled to an accounting, it is readily apparent that an order pursuant to s. 55(2) of The Trustee Act should be made. V. Conclusion [ 42 ] As explained above, this appeal must be allowed. Dorothy, as executrix of the Mother’s estate, is ordered to provide Christian, as executor of Franklin’s estate, with an accounting of the administration of the Mother’s estate.

Franklin’s estate did not ask for an order requiring that the accounts be passed and therefore there will be no such order. [ 43 ] Franklin’s estate is entitled to costs, payable by the Mother’s estate, in the usual way. If there are no assets in the Mother’s estate with which to pay costs, they shall be paid by Dorothy personally because, in the circumstances here, there was no reasonable basis for her to refuse the request for an accounting. “Richards C.J.S.” Richards C.J.S. I concur. “Caldwell J.A.” Caldwell J.A. I concur. “Kalmakoff J.A.” Kalmakoff J.A.