Micro-Managing Trustees
In Gall Estate v. Turpin, 2022 ABQB 25 there were numerous issues in dispute about the micro-managing actions of a Trustee a trust established in a will for a minor child.
The Testator died of cancer and was survived by her husband and 8-year-old son. In her Will, the Testator left her son’s inheritance from her estate in a trust which would become available to her son on his 25th birthday.
According to the terms of the trust, the money in the son’s trust could be used for the son’s “maintenance, education, advancement and benefit” before the son’s 25th birthday.
The Trustee of the minor son’s trust (who was not the surviving spouse) interpreted the terms of the trust to mean the Testator’s son was not entitled to any funds, the Trustee refused all requests for money for the minor son’s benefit and by adopting an unduly restrictive approach to providing the son with proceeds from the estate for his maintenance, education, advancement, and benefit.
The surviving spouse of the deceased brought an application to remove of the Trustee from managing his minor son’s trust.
When examining the issue, the Court was guided by the Testator’s intentions and what the Testator had written in her will; specifically, the Testator had clearly written in her will, that prior to the son’s 25th birthday, money from her estate would be paid to her son for his maintenance, education, advancement, and benefit.
The Court found that by refusing to grant requests of payment for same, the Trustee was exercising “her discretion to second guess the parenting choices” the Testator and her surviving spouse had made, and the Trustee was micromanaging the financial affairs of the surviving spouse.
The Court declined to remove the Trustee and allowed her to continue to manage the minor son’s trust. The Court commented the Trustee had not acted with malice or in bad faith and the Court did not remove the Trustee because, going forward, the Trustee now knew how to exercise her discretion in distributing funds from the estate to the deceased’s son.
