Disputes leading to estate litigation can be a financial and emotional burden on all involved, including the estate. That’s why the creation of an estate plan is so important. By organizing exactly what you want to have happen to your estate, you minimize the likelihood of disputes between family and friends. Then again, minimizing isn’t the same as eliminating. And even a carefully considered plan might be in place, disputes can still arise. This is a lesson recently illustrated in a decision from the Ontario Superior Court of Justice.

A wealthy estate

The deceased was a well-known Canadian figure skater who had spent a long time living in Mexico as a successful artist. He died while in Mexico on January 23, 2015. He had lived there for 23 years prior to his death. With no will in place, his estate was divided equally amongst his three siblings, referred to here as “B”, “C”, and “G”. B was also named trustee of the estate.

The deceased left behind a very valuable estate, including roughly 20,000 pieces of artwork. The total value of the estate, including artwork, chattels, bank accounts, and property was $6.25 million. There was still $429,958 in cash and $1.5 million in artwork left in the estate by the time the issue reached the courts.

A brief peace amongst heirs

Things seemed to be progressing positively in the early days of the estate’s management. Initially, the real estate and some of the artwork was sold, with the proceeds being split amongst the three heirs. They also divided other items from the estate. At some point, though, C and G began to lose confidence in B’s handling of the estate. The issue that led them to court was their concern about how the rest of the artwork was going to be sold.

B had been working with a number of art galleries throughout the country to sell their brother’s art. However, C and G believed that this devalued the art by flooding the market while also leaving a smaller piece of the proceeds to the estate since the galleries collected commissions on sales. C and G asked the court to divide the assets amongst the three heirs so that they could each decide how and when to sell their share. They also asked that an Estate Trustee During Litigation (ETDL) be appointed while the matter was before the courts.

It was B’s argument that she was acting in the best interest of the estate, as she was tasked to do, despite her siblings’ feelings to the contrary

A valid concern

The court recognized C and G’s concern as a valid one, writing,

“The administration of this Estate is neither simple nor straightforward and has become highly adversarial. (G and C) argue that (B’s) handling of the artwork is more focused on her vision of (the deceased’s) legacy than administering the Estate in the interests of the beneficiaries. In my view, their concern may be justified. (B) appears to have a personal interest in the outcome in conflict with the other beneficiaries.”

The court determined it was not appropriate to decide on whether or how the art was to be divided, but while they waited for a full trial, it was ordered that an ETDL be appointed.

At Derfel Estate Law our Toronto estates lawyers work tirelessly to achieve the best possible resolution to your will, estate, or trust matter. Call us at 416-847-3580 or contact us online to schedule a consultation.