Estate Trustee During Litigation: A Primer for Accountants and Lawyers

By: Hershel Sahian and Robert Alfieri¹

Trust companies and banks are often appointed by the courts to act as an Estate Trustee During Litigation (“ETDL”).² They are sometimes considered the “best choice” because of their experience, resources, objectivity and integrity.³ However, in recent years many accountants and solicitors have taken on ETDL appointments.  Given that they do not have the experience of the banks, this blog post seeks to provide practical advice and consideration for those who are contemplating taking on the role of an ETDL.⁴

The authority of the Estate Trustee/Executor⁵ flows from his/her appointment by the testator in the Last Will and Testament.⁶ When the validity of the testamentary document is challenged that authorization is brought into question. As well, an appointment of an ETDL may be warranted if parties call the propriety of an Estate Trustee’s conduct into question and seek his/her removal.

In the event the will challenger files a Notice of Objection, which challenges the validity of the Will, the authority of the Executor to act is in question and the Application for a Certificate of Appointment will not be granted. This leads to the undesirable outcome of having an Estate’s administration being suspended until the litigation comes to an end.⁷ Such an event is impractical as the Estate of the deceased will likely need to be administered in some fashion until the validity of the testamentary instrument in question is determined.  This is where the ETDL comes into place.

As further discussed below, an ETDL’s role is not always straightforward.  If s/he is not careful, the animus from the litigation can spill over against the person or entity in charge, given that the Deceased did not contemplate the appointment of an ETDL.  Rather, it is the Court that made the Order imposing a stranger into the mix.

I. The Appointment of the ETDL

A. The Statutory Basis and Role of the ETDL

The statutory authority for appointing an ETDL can be found in section 28 of the Estates Act, R.S.O. 1990, c E. 21, as amended, which states as follows:

Pending an action touching the validity of the will of a deceased person, or for obtaining, recalling or revoking any probate or grant of administration, the Superior Court of Justice has jurisdiction to grant administration in the case of intestacy and may appoint an administrator of the property of the deceased person, and the administrator so appointed has all the rights and powers of a general administrator, other than the right of distributing the residue of the property, and every such administrator is subject to the immediate control and direction of the court, and the court may direct that such administrator shall receive out of the property of the deceased such reasonable remuneration as the court considers proper.  R.S.O. 1990, c. E.21, s. 28; 2006, c. 19, Sched. C, s. 1 (1).⁸

As can be seen from s. 28 of the Estates Act, an ETDL is given broad authority.  More specifically, an ETDL is cloaked with all the rights and powers of a general administrator, other than the right to distribute the residue of the Property.⁹ However, an ETDL’s authority is somewhat curtailed as it is subject to the immediate control and direction of the Court.¹⁰ This oversight by the Court can be beneficial if the ETDL is faced with difficult decisions with respect to the exercise of its duty and authority, and requires direction from the Court.¹¹

It also should be noted that s. 28 is not the sole authority for the appointment of an ETDL.  In addition to s. 28, the court may rely upon its inherent jurisdiction to help control and ensure fairness and practicality in a proceeding.¹² As Justice Myers indicated in Mayer v. Rubin,¹³ the Court’s inherent jurisdiction exists in parallel with the Court’s statutory powers.¹⁴ This inherent jurisdiction provides the Court with broad powers to supervise the management of Estates and to control its own processes, which can include the appointment of an ETDL.¹⁵

B. Procedure to Appoint an ETDL

The appointment of an ETDL is typically dealt with as part of an Application or Motion under Rule 75.06 of the Rules of Civil Procedure.¹⁶ In fact, Rule 75.06(3)(f) specifically enumerates the ability of the Court to direct the appointment of an ETDL.¹⁷

The moving party seeking an appointment of an ETDL is often one of the parties to the underlying litigation. That being said, individuals other than the potential beneficiaries and Estates Trustees, can move to apply to have an ETDL appointed.  By way of example, a creditor, who is not a party to the underlying litigation, may apply to have an ETDL appointed.¹⁸

It has been previously noted that in the Motion or Application, the materials should include an affidavit that sets out the following information concerning the ETDL:

1. The relationship among the parties;
2. The need for the appointment of an ETDL;
3. The potential conflict of appointing a party as the ETDL;
4. The anticipated duties of the ETDL;
5. Any issues surrounding the de facto administration of the Estate prior to the appointment of an ETDL;
6. The compensation agreement for the ETDL; and,
7. The proposed security.¹⁹

1. Compensation of the ETDL

What quantum of compensation, and even whether the ETDL will receive compensation, are critical matters of concern for an ETDL.  It, however, is not ultimately within their control.  This is because an ETDL does not have the statutory right or entitlement to compensation.  This is in contrast to an Estate Trustee with or without a Will, who possesses such an entitlement pursuant to s. 61 of the Trustee Act.²⁰ Further to this point, the language regarding compensation under the Trustee Act and Estates Act includes the following:

• Estates Act, s. 28: “. . . the court may direct that such administrator [an Estate Trustee during Litigation] shall receive out of the property of the deceased such reasonable remuneration as the court considers proper”²¹
• Trustee Act, s. 61: “A trustee, guardian or personal representative is entitled to such fair and reasonable allowance for the care, pains and trouble, and the time expended in and about the estate, as may be allowed by a judge of the Superior Court of Justice.”²²

Despite the differences in the language, when compensation is paid to an ETDL, the quantum of such compensation is usually calculated in the same manner as under the Trustee Act.²³  In our experience, lawyers/accountants ask that the order appointing them as ETDL permit them to bill their hourly rate and trust companies have a hybrid of monthly fees and percentages.

In any event, to ensure that s/he will be paid for acting, a prudent ETDL should require confirmation of his/her entitlement and quantum of compensation in the Order appointing him/her.²⁴  Additionally, in the event that an ETDL wishes to pre-take compensation, it would be wise to include specific language to this effect in the Order as ETDLs are often not allowed to pre-take compensation, unless so authorized by the original Order or with the consent of the parties.²⁵  Finally, the parties and the ETDL may also wish to have a compensation agreement attached as a schedule to the appointment Order.

2. Security

Pursuant to s. 35 of the Estates Act, any person including a lawyer or accountant appointed as the ETDL is required to post a security bond, unless the requirement is specifically waived by the court.²⁶ The obligation to post a bond does not apply to a bank or trust company. Notwithstanding the statutory requirement to post security, it is possible to have the requirement of security waived for an ETDL, but only if the proposed ETDL can satisfy the Court that security is not required in respect of the case before the Court.²⁷

In Henderson Estate Re,²⁸ Justice Brown set out the information that should be before a Court, by way of affidavit evidence, when an Applicant for a Certificate of Appointment of Estate Trustee seeks to dispense with a bond:

1. The identity of all beneficiaries of the Estate;
2. The identity of any beneficiary of the Estate, who is a minor or incapable person;
3. The value of the interest of any minor or incapable beneficiary in the Estate;
4. Executed consents from all beneficiaries, who are sui juris to the appointment of the Applicant as Estate Trustee, and to an order dispensing with an administration bond should be attached as exhibits to the Affidavit. If consents cannot be obtained from all the beneficiaries, the Applicant must explain how s/he intends to protect the interests of those beneficiaries by way of posting security or otherwise;
5. The last occupation of the deceased;
6. Evidence as to whether all the debts of the deceased have been paid, including any obligations under support agreement orders;
7. Evidence as to whether the deceased operated a business at the time of death and, if the deceased did, whether any debts of that business have been or may be claimed against the Estate, and a description of each debt and its amount; and,
8. If all the debts of the Estate have not been paid, evidence of the value of the assets of the Estate, the particulars of each debt — amount and name of creditor — and an explanation of what arrangements have been made with those creditors to pay their debts and what security the Applicant proposes to put in place in order to protect those creditors.²⁹

Arguably, when the appointment of an ETDL is before the Court, the factors set out in Henderson would not be applicable – especially as it is likely that the nature of who the beneficiaries are and what their interests are may not be ascertained.

Ultimately, the waiver of the requirement to post security is a discretionary decision by the Court. Accordingly, individuals who are not named in the will who are seeking to be appointed as an ETDL or an Estate Trustee should operate on the presumption that they will have to post security and canvass their ability to procure such security either personally or through a financial institution.³⁰

II. Duties of the ETDL

An ETDL is an Officer of the Court under which direction s/he represents the deceased.³¹ The chief obligation of an ETDL is to ensure that the Estate is protected until the litigation is completed and to “… ensure that the playing field is kept level.”³²

It has been observed that an ETDL is best thought of as a “… custodian of the assets of the estate”, who should be mindful of administering “… those assets only in a manner that is consistent with the potential outcomes of the litigation, without taking any steps that may disregard the succession rights of the parties.”³³

An ETDL is required to remain neutral as between the litigating parties.³⁴ An ETDL possesses a fiduciary relationship with the parties and must adhere to the letter and the general spirit of the Order appointing him/her.³⁵ In addition to having a duty to protect the Estate during litigation, an ETDL is subject to a number of other duties, which include, inter alia, dealing with the assets, gathering information and, sometimes, even assisting the parties in resolving the litigation.  Each of these are touched upon further below.

Importantly, the duties of an ETDL continue until the litigation is finally completed, including any Appeals.³⁶ Under common law, upon termination of the litigation, the responsibilities of the ETDL cease and s/he is required to transfer the assets without having to be ordered to do so in a separate order.³⁷ As a practical matter that rarely happens.  Lawyers for the ETDL want to ensure that accounts are approved and the transfer of assets proceeds efficiently.  Accordingly, the best practice is for a motion seeking an order for the following:

1. Discharging the ETDL;
2. Declaring that the assets vest in the Estate Trustee with a Will; or directly into the hands of the beneficiaries;
3. Providing a cutoff statement as of the date of settlement. This will be preapproved by the interested parties so that there is no argument about compensation of the ETDL or what assets and what value have been transferred to the Estate Trustee.

A. Dealing with Assets

Pursuant to s. 28 of the Estates Act, an ETDL has all the rights and powers of a general administrator, other than the right of distributing the residue of the property.³⁸  This includes the ability to sell, hold, maintain and lease assets.  However, and as noted above, an ETDL is best thought of as a “… custodian of the assets of the estate” and must be mindful to only administer the assets in a manner that is consistent with potential outcomes of the underlying litigation.³⁹

In Knoch, Re,⁴⁰ the Court held that an ETDL can simply maintain the status quo of the Estate throughout the litigation.  More specifically, the Court stated as follows:

Insofar as was reasonable, the duty of the trust company [as ETDL] was to maintain the status quo, and that did include balancing the need to sell to pay succession duty and income tax against the need to maintain all of the assets until settlement of the probate action.⁴¹

When tasked or facing the possibility of having to sell a substantial asset of the Estate, it would be wise for the ETDL to obtain the consent of the parties or, in the alternative, seek approval from the Court.⁴² Additionally, and as further discussed below in section C, at times, an ETDL may be tasked with settling or pursuing claims.

B. Information Gathering

One of the less discussed, but nonetheless vital functions of an ETDL is to gather necessary information for the parties to the litigation.  By way of example, the order appointing an ETDL will generally authorize them to compel production of medical notes and records, solicitor’s notes and financial records from third parties.⁴³ As much of the aforementioned information is protected by various types of privilege, an ETDL will run into obstacles in obtaining this information without a court order.  However, in the event that there is no such language in the underlying order, the decision in Hicks Estate v. Hicks⁴⁴ should be considered.  In confirming the authority of an administrator to waive privilege, Justice Stortini held the following:

It is clear, therefore, that the privilege reposes in the personal representative of the deceased client who in this case is the plaintiff, the administrator of the estate of Mildred Hicks. The plaintiff can waive the privilege and call for disclosure of any material that the client, if living, would have been entitled to from the two solicitors.⁴⁵

Accordingly, an ETDL can step into the shoes of the deceased and be entitled to the same information that the deceased would have been able to receive when they were alive.  Notwithstanding the decision in Hicks Estates, an ETDL should attempt to avoid this situation altogether by ensuring the necessary language is set out in the appointment Order.

ETDLs should always act with an evenhand among all parties.  One step that should be taken by an ETDL to maintain this neutrality is to send copies of all correspondence and any other material and other proper information received to all parties and ensure that the parties are kept apprised of the status of the assets on a regular basis.⁴⁶

C. Paying Debts and Liabilities

ETDLs are tasked with ensuring that the proper debts of the deceased are paid throughout the life of the litigation.  As such, an ETDL should calculate and pay Income Tax in the normal course and other usual debts such as funeral expenses.⁴⁷

As noted in his text, Estate Litigation 2nd Edition, Brian Schnurr observes that dependent relief claims can be a particular issue for an ETDL.  This is because such claims are contingent on a finding that the deceased did not adequately provide for the dependant’s support in his or her Will, which may be unanswerable until the validity of the Will is determined in the underlying litigation.  It is recommended in such situations that an ETDL refrain from attempting to create a final resolution of the dependant’s support claim and should instead focus on the possibility of an interim support award pending the determination of the underlying Will challenge litigation.  In the event that consent from all parties to an interim resolution is not obtained, such an issue should be determined by the court.

The decision in Lloyd v. Lloyd⁴⁸ provides an example of interim support being awarded while an ETDL was appointed.  In Lloyd, the Court held that it had jurisdiction to order interim support to a dependant during litigation and ordered support to a spouse to ensure she “… not be impoverished when it is to be borne in mind that she has no means and there is substantial estate available”.⁴⁹

The Court went on to note that such an action did not constitute “… distributing the residue of property”, which is specifically prohibited under s. 28 of the Estates Act.⁵⁰ This is notable, as s. 28 is what empowers an ETDL with the ability to settle or compromise claims.⁵¹

In addition to s. 28 of the Estates Act, s. 48 of the Trustee Act also grants statutory authority to an ETDL to settle claims.  However, unlike s. 28 of the Estates Act, s. 48 of the Trustee Act includes a requirement that the ETDL’s discretion to settle claims be exercised in good faith.  The relationship between both of these sections was discussed by Justice Kiteley in Ontario (Public Trustee) v. Radkowski Estate as follows:

Section 48 gives the personal representative the discretion to compromise claims against an estate qualified only by the requirement of good faith. However, section 28 applies to temporary administrators such as Bryk, as a result of which the Court has ‘control and direction’ over the decisions made by the Administrator Pendente Lite.  The discretion in section 28 is not qualified.  Consequently, the discretion in section 28 is broader than the discretion in section 48.⁵²

D. Resolving Litigation

It is not uncommon to have an ETDL play an active role in reconciling the dispute between the parties in hopes of achieving a settlement.  Admittedly, this type of involvement by an ETDL has been observed to be an “unofficial” and “overlooked” role. Nonetheless, in jurisdictions where Mediation is mandatory or the parties voluntarily wish to partake in Mediation, some practitioners have found it to be beneficial to include the ETDL in the Mediation process.

One reason for this is that an ETDL will have commanding knowledge of current assets and liabilities of the Estate and the logistics of any administration of the Estate after the settlement.  Having this type of information readily available during mediation increases the odds of being able to fashion a fully formed and binding settlement agreement.  An additional benefit is that an ETDL is a neutral entity, who may be able to provide neutral, rational and cogent views to the parties when emotions inevitably run high among them.

Despite the obvious value that an EDTL brings to the mediation, parties sometimes request that the EDTL not attend.  Often, it is because parties are concerned about the additional cost for the ETDL and his/her counsel attending at mediation.  It behooves the ETDL to be in contact with the litigants prior to and, if necessary, during the mediation to ensure that they have an accurate understanding of the assets in question.  Moreover, if any settlement impacts on the role of the ETDL, on a go forward basis, it makes sense that the ETDL has input.  For example, litigants often want the ETDL’s assistance to implement a settlement, obtain appraisals, valuations, tax information and make final distributions, which raises several issues.

As discussed above and implied by its name, the role of the ETDL should end when the litigation ends.⁵³ At that point, the litigants have stopped fighting and either by consensus or court order a decision has been made about which testamentary document is the Last Will and Testament and who is the rightful Executor.  Practically, the following steps should then be taken:

1. Pursuant to Rule 48.12 of the Rules of Civil Procedure, there is a duty to inform the Registrar of Settlement.
2. If minors are involved, court approval of any settlement is needed.⁵⁴ A motion for approval should be brought with provisions for the removal and discharge of the ETDL, vesting of the assets (including a valuation) to the Estate Trustee,  approval of the ETDL’s  accounts and that the Estate Trustee appointed by the Will to take over the administration of the Estate; and
3. If the settlement contemplates the ETDL making a final distribution, a motion should be brought seeking dismissal of the action and the relief sought should incorporate the provisions of the settlement, including approval of the ETDL’s accounts and directing the ETDL to do the final distribution.   However, that may be problematic.

Firstly, ETDLs, by virtue of statute, are not permitted to make final distributions.⁵⁵ For an ETDL to legally make a final distribution there would need to be a court order directing the EDTL to make that distribution.  The ETDL should also consult with his/her legal counsel to address s. 159 of the Income Tax Act (“ITA”) and probate fees.

In simple terms, s.159(2) of the ITA provides that every legal representative (which includes an ETDL) shall, before making a distribution obtain a Clearance Certificate certifying that all taxes of the deceased have been paid.  Subsection 159(3) holds the legal representative personally liable if there is a distribution leaving insufficient funds in the estate to pay the taxes.⁵⁶

Prudent counsel will advise the ETDL to retain an accountant to calculate a reasonable reserve and holdback to pay contemplated expenses to wind up the Estate, which will include a conservative estimate of outstanding taxes pending receipt of a clearance certificate.  Once that is dealt with, the issue of probate fees has to be dealt with.

In the ordinary course, probate fees are paid by the Estate Trustees on behalf of the Estate when they make the Application for Certificate of Estate Trustee with a Will.  No probate fees, in the ordinary course, are paid by the ETDL.  But, litigants may view having the ETDL doing a final distribution as a way to end-run having to pay probate fees.

We have been advised by senior counsel that there are Judges, who may frown upon attempts to circumvent the obligation to pay probate fees.  If parties contemplate using the ETDL to avoid paying Probate fees, a conservative lawyer would likely advise the ETDL to ask the Court to address this issue in any final order implementing a settlement.

III. Conclusion

In his 2014 article, a leading practitioner in this area of law once described the role of administering an Estate in the following way:

The workload, the endless calls from beneficiaries about their inheritance, the stress of deadlines and working with professionals, the necessity of keeping meticulous accounting and even the rafts and rafts of paper and documents that must be kept, make the thankless job time-consuming and frustrating. More correctly, the job is worse than thankless. How often do we see disgruntled beneficiaries criticizing the job the executor has done and seeking to reduce the compensation that the executor has sought?

[ … ]

But, it can get much, much worse. When one takes on the job of executor, s/he is putting his/her own personal assets on the line.⁵⁷

LAWPRO may or may not protect lawyers, who take on the job of an Executor or ETDL.⁵⁸ Out of an abundance of caution, lawyers, or any individual for that matter, who are seeking to become an ETDL should explore the possibility of obtaining Executor’s insurance and determine whether the Estate will pay for such insurance.⁵⁹ It is prudent to make sure that the order appointing the ETDL allows the ETDL to purchase and pay for insurance from the Estate.

As each Estate’s administration is unique and over the life cycle of an administration, the landscape may rapidly change, an individual who seeks to dawn the mantle of an ETDL may be thrust into a situation fraught with risks and liabilities or s/he may find him/herself simply acting as a placeholder and ensuring the status quo is maintained.  Regardless, ETDLs should be attuned to the fact that it is possible that they are entering an arena in which they may be sued personally, be ordered to pay costs or not receive 100% indemnification for their fees out of the assets of the estate.⁶⁰ As a result, an individual considering acting as an ETDL should seek to take the necessary precautions to ensure that they are reasonably protected from liability and are fully informed as to what the role entails.

IV. Checklist For ETDL

The following is a checklist that may assist ETDL’s in the administration of an Estate:

1. The person considering being appointed as Estate Trustee During Litigation should obtain the following:⁶¹
   1. 1. Death Certificate or Statement of Death;
      2. Particulars of the Estate dispute;
      3. If the dispute involves determining the validity of one Will over the other notarial copies of the contested Wills;⁶²
      4. Other contracts affecting the Will (e.g., Separation Agreement);
      5. Names and addresses of beneficiaries/potential beneficiaries;
      6. Preliminary list of assets, including relevant particulars as to fair market value at time of death and when presented to prospective ETDL. See # 4 below; and
      7. A draft of the Order for the appointment as ETDL.  It is imperative to show this to a competent lawyer to ensure the mandate of the ETDL is clear and doable and that the fee structure⁶³ of the ETDL is approved in the Order.
2. To apply for a Certificate of Appointment of Estate Trustee During Litigation, you will require the following:⁶⁴
   1. A copy of the Order appointing the Applicant as Estate Trustee During Litigation⁶⁵;
   2. The security required by the Estates Act⁶⁶; and
   3. Such additional or other material as the Court directs.
3. Ensure the assets are insured.
4. Show total value of all assets passing on death and categorize the following:
   1. Real estate:
      1. Short legal description;
      2. Appraisal obtained or estimate of Fair Market Value;
      3. Particulars of any charge, mortgage or other encumbrance;
      4. Principal residence, investment property or vacation property;
      5. Particulars of registration of probate; if Executor’s deed, date of registration, where registered, and instrument number;
      6. If joint tenancy, confirmation of vesting in surviving joint tenants and if Land Titles, who prepared transmission application and registration particulars;
      7. If sold during administration, report details or refer to reporting letter from real estate department; and
      8. Particulars of insurance policies as they may lapse if the property is unoccupied/vacant.  Contact insurer to ensure requirements for policy to remain valid.
   2. Land charges or mortgage:
      1. Brief description of mortgage and how registered;
      2. Original term and balance owing at date of death;
      3. Particulars of registration of Probate;
      4. Particulars of assignment and registration particulars;
      5. If joint tenancy, confirm vesting in survivor and particulars of transmission application if Land Titles;
      6. Confirm arrangements for future payments of instalments; and
      7. Return old documents and forward duplicate copies of assignments, etc.
   3. Book debts and promissory notes:
      1. Short description, including amount owing, by whom, interest rate and terms; and
      2. If redeemed or if transferred, show details and arrangements for future payment.
   4. Insurance and annuities:
      1. List by company;
      2. Report all policies payable on death showing number of policy, beneficiary and amount payable;
      3. Report completion of claim forms and documents supplied to insurance company to establish claim and proof of death;
      4. Amounts paid and cheques dealt with; and
      5. If any insurance policies are registered as retirement savings plans, report income tax consequences and any other relevant information.
   5. Cash on hand and money on deposit:
      1. Show particulars of all bank accounts, how registered and balances on date of death;
      2. In case of joint accounts, confirm title vested in survivor and that bank has been provided with proof of death, if registered in name of deceased, confirm Probate produced and instructions given for disposal of accounts;
      3. If accounts closed, report amount received and where cheques were deposited or forwarded; and
      4. If there is a substantial difference between closing balance and date of death balance, give explanation for difference.
   6. Bonds, debentures and certificates of deposit:
      1. Show particulars at date of death;
      2. Report on steps taken to have securities placed in transferable form;
      3. If any securities sold, report particulars including broker, if applicable, and what happens to proceeds of sale;
      4. If transferred to beneficiaries, who, particulars including new Certificate numbers and registration particulars; and
      5. Forward any Certificates to beneficiaries if still held.
   7. Stocks and shares.
   8. Other assets:
      1. Household goods, etc.;
      2. Jewelry;
      3. Automobiles;
      4. Boats;
      5. Income Tax Refunds; and
      6. Canada Pension Plan death benefits payable to the Estate.
5. Manage real property:
   1. Change locks;
   2. Obtain security codes;
   3. Contact security company to update information and security codes;
   4. Arrange weekly inspection to check water, heat and lock windows;
   5. Take video inventory and arrange for appraisers to create a list of contents and valuables;
   6. Shut water supply if needed to prevent winter freezing; and
   7. Remove and secure valuable contents (e.g., artwork to be stored in insured, humidity-controlled environment).
6. Letters to banks to enquire of other assets owned at death.
7. Prepare inventory of items in safety deposit box, close safety deposit box and safeguard valuables.
8. Complete Canada Pension Plan application:
   1. Report completion of claim forms for death benefit and survivor’s benefits on behalf of estate to surviving spouse and children applicable; and
   2. Confirm amounts paid or awarded if this information is known.
9. Notify Old Age Security.
10. Contact the Deceased’s accountant to ensure the fillings are up-to-date.
11. Diarize dates for filing T1 and T3 Income Tax Returns.
12. Assist Parties in accordance with Court Order and at Mediation.  Court Orders under which the ETDL is appointed often mandates the ETDL to obtain certain documents from third parties to assist the litigants both in prosecuting or defending their claims and at mediation.  So the ETDL should first review the court orders mandating their appointment and tasks assigned to them and then contact the named third parties to obtain the relevant documentation.⁶⁷
13. The ETDL has a fiduciary duty to keep proper accounts, which will include a Statement of Assets at date of death and ongoing records of the assets and liabilities of the Estate.It, also, will possibly include options for post mortem tax planning and ascertaining the debts, assets and liability of the Estate. All this information has to be presented to the parties involved in the litigation in sufficient time prior to the Mediation to assist them properly.
14. File Terminal T-1 income tax return, receive Notice of Assessment and apply for Clearance Certificate:
    1. Report preparation of Income Tax Return for broken portion of year of death, elections made, any elective returns and preparation of unfiled returns for prior years;
    2. If capital disposition, was election made?
    3. Confirm filing date with CRA and if liability eliminated, the amount and how paid;
    4. Assessments; and
    5. If applicable, report preparation of USA tax return and confirm details.
15. File T-3 Income Tax return, receive Notice of Assessment and apply for Clearance Certificate:
    1. Period for which return filed and deadline date;
    2. How income was taxed during this period;
    3. If continuing Trust, requirements for future returns and filing dates; and
    4. Are non-resident returns required?
16. Confirm necessity of advertisement for creditors.
17. If applicable, complete transfer of assets specifically devised in Will
18. Upon settlement:
    1. Review settlement agreement for any role contemplated for the ETDL and verify with counsel what is acceptable;
    2. It is likely that the ETDL will want its accounts approved either informally or by court order. If it is informally, ensure that the beneficiaries sign Releases and arrangements are made for payment;
    3. Transfer assets to the Estate Trustee with a Will or Successor Estate Trustee and provide the accounting prepared so it is clear what assets are being vested in the Estate Trustee with a Will; and
    4. In the Order approving settlement (or if there are no minors, the Order dismissing the Application) ensure that there are provisions to discharge the ETDL, approving the accounts and vesting the assets with the Estate Trustee with a Will.
19. If applicable, close the Estate account.
20. If applicable, final report to Estate Trustee

Precedent Clauses for Court Order⁶⁸

Set out below are sample terms incorporated in an order to appoint an ETDL.  It is not an all-inclusive list and lawyers drafting such orders must use their judgment to determine which ones are appropriate for their particular case.⁶⁹:

1. THIS COURT ORDERS that the Estate Trustee During Litigation shall search through all the records of the Deceased and provide to the Applicants any and all contact information relating to those Respondents not yet served. The Estate Trustee During Litigation shall take all reasonable steps to obtain those addresses for service if same are not available through the Deceased’s books and records. The costs of the search to obtain the addresses shall be borne by the Estate.⁷⁰
2. THIS COURT ORDERS that ● be appointed as Estate Trustee During Litigation, without security,⁷¹ of all singular property of the Deceased and his/her Estate (the “Estate”) pending the final resolution or settlement of the litigation herein and that a Certificate of Appointment of Estate Trustee During Litigation be issued to ● subject to the filing of the necessary supporting Application.
3. PROVISIONS RELATING TO COMPENSATION:
   1. VERSION ONE – THIS COURT ORDERS that subject to further review by the Court and on a without prejudice basis to the parties hereto challenging the amount of same on a passing of accounts, the Estate Trustee During Litigation shall receive out of the assets of the Estate reasonable remuneration for all executor services provided following the death of the Deceased and shall be able to pre-take his compensation based on an hourly rate of $● together with disbursements incurred in the course of performing his duties, plus any applicable GST.  Unless the Court orders otherwise, or the parties agree in writing, the total compensation taken will no exceed the amount allowed when calculating using the usual executor percentages for compensation. [alternatively, reasonable remuneration for his services to be calculated in accordance with the particulars of the Fee Schedule attached hereto as Schedule “A”].
   2. VERSION 2 THIS COURT ORDERS that, subject to further review by the Court, if necessary, A.Lawyer, in his/her capacity as Estate Trustee During Litigation (the “Estate Trustee During Litigation”) shall receive out of the assets of the Estate of the Deceased reasonable remuneration, which shall be calculated on the basis of A. Lawyer’s hourly rate in the amount of $500.00 per hour.
4. THIS COURT ORDERS that the Estate Trustee During Litigation be and is hereby authorized to exercise those powers given by law to an administrator, including such powers given to an administrator under the Estates Act,S.O. 1990 c.E.21 as amended, and without limiting the generality of the foregoing, the Estate Trustee During Litigation shall have the following rights and powers:
   1. to gather in and take full account of the assets and liabilities of the Deceased and of the Estate;
   2. to preserve and maintain the assets of the Estate;
   3. to pay all just debts, funeral and testamentary expenses and all income taxes of the Deceased and of the Estate excluding any income taxes or taxes of any nature of kind in respect of any assets whose ownership or beneficial entitlement may be in dispute;
   4. to obtain information, records and files relating to the assets and liabilities of the Deceased in the same manner and to the same extent the Deceased would have been if s/hee were alive;
   5. to obtain a real estate appraisal of any real property comprising the assets of the Estate;
   6. to sell [items, i.e. any article of personal, domestic or household or ornament comprising of the assets of the Estate including Consumable Stores and all automobiles and accessories thereto];
   7. to reinvest any investments of the Estate that may come due in similar investments to the investment coming due, or a GIC cashable after ● days; and
   8. to be at liberty to appoint an agent or agents and seek such assistance from time to time as the Estate Trustee During Litigation may consider necessary for the purpose of performing his duties hereunder and to pay those agents and representatives, including legal counsel, from the Estate.
5. THIS COURT ORDERS that the Estate Trustee During Litigation is hereby authorized to sell the property municipally known as ● upon obtaining two appraisals of the property, without further leave of the Court, on notice to those parties.
6. THIS COURT ORDERS that the Estate Trustee During Litigation shall do the following:
   1. seek and obtain production of all medical records and files relating to the Deceased from any person or institution in possession of such medical records, in the same manner and to the same extent as the Deceased would have been able to, if she was alive, and that all productions received be produced to the parties on request. The charges for the production of the records and files shall be paid from the Estate by the Estate Trustee During Litigation, and the final determination as to payment of such cost and expenses shall be reserved to the Trial Judge;
   2. seek and obtain production of all financial records and files relating to the assets held by the Deceased from any financial or banking institution, whether in Canada, or in the United States, or elsewhere, in the same manner and extent as if the Deceased would have been able to, if s/he was alive, and that all productions received be produced to the other parties on request. The charges for the production of records and files shall be paid from the Estate by the Estate Trustee During Litigation, and the final determination as to payment of such costs and expenses shall be reserved to the Trial Judge; and
   3. obtain OHIP records with respect to the Deceased from the maximum retroactive time period that those records be available, with copies of same together with any medical reports, provided thereto, to be provided to any party who so requests same in writing. The charges for the production of records and files shall be paid from the Estate, by the Estate Trustee During Litigation, and the final determination as to payment of such costs and expenses shall be reserved to the Trial Judge.
   4. physician contacts, order that those contacts listed in the OHIP records fork over their files related to those dates or assets.
   5. hospitalization shortly before or after then all the records from the hospital during that time frame.
7. THIS COURT ORDERS that the Estate Trustee During Litigation shall:
   1. not sell any of the other real properties owned by the Deceased or that are now assets of his/her Estate without the leave of the Court; and
   2. not make any distribution of the residue of the Estate without order of the Court.
8. THIS COURT ORDERS that the Estate Trustee During Litigation shall not distribute any assets from the Estate without the agreement of all parties or Court Order.
9. THIS COURT ORDERS that upon the appointment of ● as Estate Trustee During Litigation, the Caution registered on title as Instrument no. ● on ● for the property municipally known as ●, (P.I.N.) be hereby discharged and removed from the title abstract. The Estate Trustee During Litigation shall obtain said discharge and the costs of so doing shall be borne by the Estate.

The following are terms, which may be included in, among others, the Order removing the ETDL:

1. THIS COURT ORDERS that the settlement reached by the Parties, as reflected in Minutes of Settlement attached hereto as Schedule “A” to this Judgment, is hereby approved on behalf of the Minor, and its terms incorporated by reference into this Judgment.
2. THIS COURT ORDERS that the Estate of * (hereinafter “the Estate”) will be administered pursuant to the deceased’s Will dated *, attached as Schedule “B” to this Judgment (“Last Will”), but that the Applicant shall be treated for the purposes of the Estate administration as having deceased and his funeral having already been paid, and the Minor shall be immediately entitled to receive his inheritance under paragraph * of the Last Will (subject to paragraph * of the Last Will).
3. THIS COURT ORDERS that * be and is hereby removed as the Estate Trustee During Litigation of the Estate (“ETDL”), which appointment was pursuant to the Order of the Honourable Justice * dated *.
4. THIS COURT ORDERS that * be and is hereby appointed as Estate Trustee with a Will of the Estate, without security, in respect of the Last Will of the Deceased.
5. THIS COURT ORDERS that the * will apply for a Certificate of Appointment as Estate Trustee with a Will and will administer the Estate including the Testamentary Trust, in accordance with the Minutes of Settlement and this Judgment, and pursuant to the Compensation Schedule for Executor and Trustee Services attached to the Last Will.
6. THIS COURT ORDERS that the Registrar shall issue a Certificate of Appointment of Estate Trustee with a Will to *, without security, upon the further filing of the necessary supporting Application.
7. THIS COURT ORDERS that * is permitted to appoint an agent, or agents, and seek such assistance from time to time as may be necessary for the purpose of performing its duties hereunder. All charges for such services are to be paid out of the income and/or capital of the Estate and shall not be charged against the compensation payable to the Estate Trustee with a Will.
8. THIS COURT ORDERS that all of the assets of the Estate be and are hereby vested in * as Estate Trustee of the Estate.
9. THIS COURT ORDERS AND DECLARES that the Applicant and Respondents have irrevocably acknowledged and agreed that the accounting, accounts, statement of accounts, compensation, and legal accounts of * as ETDL of the Estate, and/or in any other capacity, to and including the date of this Judgment, and its administration of the Estate to and including the date of this Judgment, have been and are satisfactory.
10. THIS COURT ORDERS AND DECLARES that the Applicant and the Respondents have irrevocably waived, released and dispensed with any entitlement to and/or right that they, or any of them, had or may have to require * as ETDL of the Estate, or in any other capacity, to provide an accounting, and/or to bring an application to pass accounts in respect of its administration, and/or services provided, in respect of the Estate in accordance with the Rules of Civil Procedure, or otherwise, to and including to the date of this Judgment.
11. THIS COURT ORDERS that the Applicant and the Respondents will bear their own legal costs.
12. THIS COURT ORDERS that the Applicant and the Respondents will share equally the following costs and make payment of the following costs as follows:
    1. To the ETDL, $* (as of *)(this payment is to be made by the Applicant and the Respondents directly to the Estate as the ETDL has already had the Estate make the payment of this amount); and
    2. $*
13. THIS COURT ORDERS that, subject to paragraph * above, the Estate shall be responsible for the payment of:
    1. Any fees and expenses due to the ETDL as of the date of this Judgment;
    2. The ETDL’s legal costs from * to * in the amount of $*;
    3. The reasonable legal costs of the ETDL incurred from * to and including the date of this Judgment;
    4. Storage Costs and any other incidental/administrative fees or costs incurred by the ETDL with respect to personal property in the Estate, estimated to be less than $* in total; and
    5. Any and all fees, costs, expenses and debts of the Estate from the date of this Judgment onwards including, but not limited to, taxes and administration expenses of the Estate and the compensation and professional costs of * in its capacity as Estate Trustee of the Estate.
14. THIS COURT ORDERS that * in its capacity as Trustee of the testamentary trust to be established under the Deceased’s Last Will in respect of * shall receive compensation pursuant to the Compensation Schedule for Executor and Trustee Services attached to the Last Will (“Compensation Schedule”). For clarity, the Trustee Fee would include:
    1. *
15. TIS COURT ORDERS that * in its capacity as Trustee of the testamentary trust to be established under the Deceased’s Last Will in respect of * is permitted to appoint an agent, or agents, and seek such assistance from time to time as may be necessary for the purpose of performing its duties thereunder. All charges for such services are to be paid out of the income and/or capital of the said testamentary trust and shall not be charged against the compensation payable to the Trustee of the said testamentary trust.
16. THIS COURT ORDERS that the Applicant and Respondents shall signthe Full and Final Release attached as Schedule “C” to this Judgment and deliver the said Full and Final Release as signed by them respectively to counsel for * within 30 days of the date of this Judgment.
17. THIS COURT ORDERS that there shall be no costs payable with respect to this Application apart from those set out above, and that the balance of the Application is dismissed.