Toronto Estate Lawyer : Hull & Hull Law Firm : Trust Mediation and Succession Planning : Serving Ontario, Ottawa, Mississauga, Hamilton

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Law firms, such as ours, tend to emphasize the benefits to clients of their respective area of specialization. The common pitch to prospective clients is that there is less of a learning curve on each file and, as a general proposition, most problems have usually (with some variation) been seen before.

However, the flip side of specialization is that it may not always best serve the client who presents a hybrid problem spanning two or more areas of law .  In such circumstances, counsel need to candidly assess to what extent their area of specialization may limit their ability to serve their client.  On the other hand, because certain areas of law tend to overlap with considerable frequency, the client who seeks specialized advice is well-served when such counsel recognize this fact and adapt accordingly. 

Certainly, the practice of estate litigation can often overlap with family law litigation.  Take , for example, a beneficiary designation dispute.  While at first glance an estates issue, the existence of a separation agreement and its impact on the dispute inevitably gives rise to legal issues where family law counsel will have considered the issue from their own perspective.  So, too is the decision facing a surviving spouse as to whether to elect under the Family Law Act on the death of his or her spouse. Again, responsible counsel have an obligation to best serve the client.

Continuing Legal Education plays a role as well.  For instance, the Ontario Bar Association has in the past run a program entitled "Kissing Cousins."  A joint venture of the Family Law and Estates and Trusts Sections of the OBA, the mandate of this program has been to highlight practice issues in which estates and family law issues overlap.

David M. Smith

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Anne Werker recently brought an interesting case to my attention. In Rooney Estate v. Stewart Estate[1], the solicitor who performed the executor’s duties attempted to rely on a release signed by a beneficiary in his response to an application that he pass accounts in his capacity as de facto trustee.

Pierce J. held that in order for a release to be enforced, the beneficiary who signs the release:

1.   must be “fully informed”;
2.   must have received competent legal advice in a review of the accounts;
3.   should understand how compensation has been charged; and
4.   should know what legal services have been provided and what the fees were.

Pierce J. also held that a distribution cannot be withheld pending the execution of a release. It is simply fiction for an executor to believe that he/she can refuse to distribute the estate until a signed release is in hand. A holdback must be reasonable and demonstrably justifiable in the circumstances (i.e. tax liability or the costs of a passing). 

However, in the end, some common sense must prevail. In a simple administration, it is unlikely that formal accounts will be prepared for passing either because no compensation is claimed or the costs of doing so are prohibitive. However, the executor will likely ask for a release on the distribution of the estate. In that case, transparency may be the answer. By communicating regularly with the beneficiaries, sending them pertinent information and updates, and/or preparing an informal accounting (including how compensation has been taken), a court may just be convinced that a signed release is good enough.

“TGIT”

Justin