Estate Trustee Accountability: Applications for Passing of Accounts

Estate matters can be a complex and emotionally charged area of law, regardless of the estate’s size. Not only are the parties usually grieving, but family dynamics can impact the administration of an estate rendering it particularly difficult to navigate. Beneficiaries frequently experience a sense of exclusion from the estate administration leading to apprehension about the actions and management of estate assets by the Estate Trustee.

Who is allowed to pass accounts of an estate?

Pursuant to Rule 74.15(1)(h) of the Rules of Civil Procedure (the “Rules”) “any person who appears to have a financial interest in an estate may move, for an order requiring an estate trustee to pass accounts.” This rule provides beneficiaries, and potentially interested parties, with a means to request a court’s review of the estate’s administration and challenge specific actions taken by the Estate Trustee.

An Application to Pass Accounts provides transparency and accountability, ensuring that the estate’s assets are being managed and distributed properly. It also ensures the Estate Trustee is acting in the best interest of both the estate and its beneficiaries, and without any ulterior or self-serving motives.

Who can object to the passing of an account?

Once the Estate Trustee has brought the Application to Pass Accounts, the beneficiary or interested party can object to the accounts by serving a Notice of Objection to Accounts. Such objections can include, but are not limited to, expenses paid by the estate, the amount an estate trustee obtained for an asset on its sale, the value of the estate as of date of death, or the amount of compensation the estate trustee is seeking.

Section 49(2) of the Estates Act (the “Act”) also allows the Judge hearing the Application to Pass Accounts to “make a full inquiry and accounting of and concerning the whole property that the deceased was possessed of or entitled to, and its administration and disbursement. This means that if there are complaints or claims of misconduct on the Estate Trustee’s part relating to the value of the estate at the deceased’s time of death, a Judge can require the Estate Trustee to account for any assets that were disposed of prior to the deceased’s death, which may have caused a reduction to the estate’s value.

If the Judge hearing the matter determines that the Estate Trustee was negligent or their actions amount to misconduct, section 49(3) of the Act allows the Judge to award damages payable by the Estate Trustee personally.

The importance of the timing when applying to pass accounts

If you are considering commencing an application to compel an Estate Trustee to pass accounts, it is important that you act promptly. As an application to compel a passing of accounts is considered a claim, there may be a limitation period requiring a beneficiary or interested party to commence the application within two years following the deceased’s death.

For more information about applications to pass accounts or your legal rights as a beneficiary or interested party with respect to an estate, contact the Estate Team at Brown Beattie O’Donovan. We are here to help.

Written by Laura Book