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However, even the mildly famous or sainted can have their moment in the estate spotlight.  Recently, Luciano Pavarotti's family was in the news when a dispute arose among his offspring in respect of his considerable fortune.  They have apparently reached a settlement.

I also read with interest a recent US newspaper article indicating that two of Martin Luther King's children had filed a lawsuit against a third regarding a dispute over the civil rights leader's estate (J. Edger Hoover would have loved it).  Bernice King and Martin Luther King III filed a lawsuit in Atlanta in order to force their brother, Dexter King, to open the books of their famous father's estate.

From what I understand, the lawsuit claims that Dexter King, who is the executor of his father's estate, has refused to provide his brother and sister with documents concerning the estate's administration.  The lawsuit claims that Dexter King and the estate "converted substantial funds from the estate's financial accounts…for their own use".  The siblings were never told beforehand and are now seeking financial records and other documents in order to investigate the administration of the estate. 

Martin Luther King's "dream" seems to have stalled when it comes to sibling rivalry and the fortunes of his estate.  However, on a more serious note, the dispute once again reminds us of the importance of transparency in the administration of an estate and open communication between executor and beneficiary.

Thanks for reading.  Auf Wiedersehen

Posted on March 18^th, 2008 by Hull & Hull LLP

Suzana Popovic-Montag:  Hi and welcome to Hull on Estate and Succession Planning. You’re listening to Episode #104 of our podcast on Tuesday, March 18^th, 2008.

Welcome to Hull on Estate and Succession Planning, a series of podcasts hosted by

Ian Hull and Suzana Popovic-Montag, that will provide information and insights into estate planning in Canada, from the offices of Hull Estate Mediation in Toronto, Ontario, Canada.  Here are Ian and Suzana.

Ian Hull: Hi, it’s Ian Hull here solo this week. We – Suzana and I couldn’t get organized to get this podcast as a team, so you’ve got me alone. We’re going to deal with a couple of issues – I’m going to deal with a couple of issues that I think should be interesting. So don’t forget then for Hull on Estates and Succession Planning that you can, of course, call in and we are happy to receive your calls and to do what we can to answer your questions. Our call-in number, 206-350-6636.

Now before I start the podcast, it is in its own way appropriate that I’m doing this solo because Suzana wouldn’t give herself the credit that she deserves. In the last issue of the Canadian Lawyer, that’s the March 2008 issue, we had some really interesting topics dealt with and one of them was a whole section on developments in technology and a lawyer’s role in technologies. Hull and Hull was very honored to be placed on the list of the author Gerry Blackwell’s list of Top 10 blogs, Toronto Estate Law blog, which we do daily during the week. One of the lawyers in the office does it. It is rated as one of the Top 10 law related blogs.  And the author sort of goes in to describe the various blogs and there’s some really interesting blogs that are out there law-related. Michael Geist is one, and that’s MichaelGeist.ca. He’s a University of Ottawa law professor and he has a fascinating blog that I have been following. There’s a great blog that I was privileged to be recently interviewed on their podcast and that is lawiscool.com. And it was launched last year by a group of Canadian law students, and it’s another – the author describes it as an impressive example of the many heads approach that the law blog that we do and that is, is that there are various bloggers. They’re a good group and a really interesting group actually having got to know them.  And as I say, having been interviewed by them. There’s a neat blog out of Kelowna, BC called Rule of Law, and that’s rulelaw.blogspot.com. The sole practitioner, Stan Rule, has been blogging it says in the article since 2005. Considering and covering British Columbia Wills and trusts and estates law and elder law. And I’ve been following this blog for sure over the years and he has several posts, some days are more than one even and I highly recommend the blog.

So carrying on with our news and events summary, also in the March issue of the Canadian Lawyer is a great article on new frontiers where law firms – it talks about law firms starting to explore cutting edge potential of the virtual worlds, talking about social media, web 2.0 technologies. And the interesting part of this article, again it’s in the Canadian Lawyer and it’ll be up on our website, is of course, that we have our one and only Suzana Popovic-Montag heavily quoted throughout the article. And she talks about the shift that’s happening where there are some networking opportunities, of course, that come outside of the typical ones and one of the other individuals who was interviewed talked about it being something outside of the typical golf game, which of course, I try to play badly. But Suzana goes on to talk about the presence that she wanted the firm to have out there.  And as a co-starter and co-founder of all of this technology at our firm here, she’s been spearheading the efforts. Really been a great source of information and enthusiasm and as she says, even in this firm, at the start, there was some resistance from everybody but it started to pick up and it’s picked up throughout the legal profession.

She describes podcasts as internet radio which I like that, that’s a neat way of putting it.  And she really does focus on some of the future steps and one of them that we’ll be announcing in due course is our efforts to get onto Second Life. We had been working over that over the last few months and no doubt, you will hear more about that as we proceed.  So kudos to Suzana, and it’s really a real tribute to her efforts.  Enthusiasm from me in this project is only part of the starting gate and she’s the one who’s held the process together. So it’s nice to see her get some publicity. So that’s the Canadian Lawyer magazine which is published monthly, and a great source which we’ll throw on our webpage.

Now just turning to, because this is a solo effort, I want to keep this reasonably well within our timeline. As Suzana described in her article, she calls our 10-12 minute podcasts treadmill time, so I’m going to keep that in mind. We were talking about and we continue to talk about the role as estate trustee once you are appointed. Our last few podcasts anyway have really been focusing on the pre… before you even get probate, some of the steps you want to take. And I thought I would just step back and take a deep breath and look at the job from the standpoint of a lawyer, because one of the things that I think people forget, is the extensive personal liability that is attracted to being an executor. And I say that because when you start as an executor, and we’ve talked about how we start right from the moment of the time of death, funeral plans and arrangements and right through to administering the assets of the estate, you become personally liable.

And personal liability is an incident of the office of a trustee. So when you’re carrying on the business of a trustee, it is personal liability. And that is created at both levels. One is on the case law level, but the other is on the taxing authority level.  And in Canada and throughout any of the Commonwealth jurisdictions, many hundreds of years of case law, the Courts have said that if you mess up as a trustee, you’re personally liable. There is no protection behind a corporation or anything like that which many people like to use in business. And, for example, in Canada, the CRA, the taxing authority here, has specific provisions in the legislation that allows Revenue Canada to look to a trustee from a personal liability standpoint if there has been some misdeeds. Now what they will typically do and without scaring people, it is as I said in some podcasts before, you can’t go below zero. So your personal liability is something that is, in some respects, protected… well, it’s limited to a certain extent. But as a trustee and in the common law, you are personally liable. So, you know, you want to step back.  You are putting your own personal assets at risk when you take on the job.

And one of the classic scenarios where personal liability comes out and stings a trustee with great surprise and horror, in some cases, is when you have real estate. And recently and certainly most of the…in the U.S. and Canada, the whole growth industry in litigation has been with respect to environmental litigation. So as a trustee, certainly in Ontario, if you take on the duty of a trustee and you are administering contaminated land, it’s something to worry about because again, like the taxing authority and like the case law, you can create personal liability for managing what may have been, say, a polluted site. And ultimately, someone like the Ontario government, could come and say “clean up the site”. And if the value of the property isn’t enough to pay for the clean up, you can create new problems. So you… also create those problems when you enter into third party contracts. For example, say you hired an individual to do the clean up.  You create some, again, personal liability. You’re entering into the contract as an estate trustee, but from a government authority’s standpoint, you can be creating personal liability.

So it just seems to me that one of the things that we like to consider, as we have throughout, is obviously looking at avoiding liability. And to avoid this liability, and in a sense to sort of wrap up my comments here is, is that now that I’ve got you convinced that there is extensive personal liability, my suggestion to my clients is typically to make sure that you have undertaken adequate consideration of the nature and extent of the assets. The standard of care is going to be held against you as very high in your administration of the assets, so I remind my clients that before you jump into the pool, make sure there’s enough water.

So, anyway, I hope that’s been helpful. Again, well done on Suzana’s part in her Canadian Lawyer publicity.  And I remind everyone to feel free to call in at: 206-350-6636. And don’t forget to check out our blog, which is probably easiest to get to when you go to hullandhull.com, you will find the site right on the left-hand corner on our web page and it’ll click you right into our blog. So again, well done Suzana, and thanks for listening.

You’ve been listening to Hull on Estate and Succession Planning with Ian Hull and Suzana Popovic-Montag.  The podcast you have been listening to has been provided as an information service.  It is a summary of current legal issues in estates and estate planning.  It is not legal advice and you are reminded to always talk with a legal professional regarding your specific circumstances.

To listen to other Hull On podcasts, or to leave a question or comment, please visit our website at www.hullestatemediation.com.

Our theme music is UpTempo14 by Gary and is courtesy of the Podsafe Music Network.

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