On January 17, 2019, Nova Scotia’s Finance and Treasury Board (“NSFTB”) announced changes to the Province’s Equity Tax Credit program, a popular tax credit program that has been in place since 1994 and utilized by many Nova Scotia companies and investors in a number of different industries. The Province’s stated goal for re-working the Equity […]read more
Removal of a Personal Representative – When and Why?
Under what circumstances can and should a Court remove a Personal Representative appointed by the will of a deceased? This was the main issue which faced Justice Gogan in the matter of Willisko v. Pottie Estate, 2014 NSSC 389.
Allister Michael Pottie died on August 19, 2010. He was predeceased by his wife. They had nine children. Under his will dated September 29, 2008, one of the children, Valerie Ann Murphy, was appointed Personal Representative. By the early fall of 2013 administration of the estate had not progressed sufficiently in the view of at least one of the deceased’s other children, Sharon Louise Willisko. Accordingly Ms. Willisko applied in October 2013 for an Order removing Ms. Murphy as Personal Representative. Justice Gogan rendered her decision on October 27, 2014.
At the time the matter was heard Ms. Murphy had not yet opened probate nor had she filed an Inventory as required by the Probate Act. As well, a dispute remained as to what should become of money in a bank account held jointly by the deceased and Ms. Murphy. She took the position it was her father’s intention that she receive these funds. Other siblings took the position it should form part of their father’s estate.
The application was brought under section 61 of the Probate Act. This section gives the Court authority to remove a Personal Representative. The general power can be exercised if the Court is satisfied that removal of the Personal Representative would be in the best interests of those persons interested in the estate.
Justice Gogan reviewed prior authorities which addressed the principals upon which the Court’s authority is to be exercised. The cases confirm that the Court is not to remove a Personal Representative lightly or without good reason based on evidence. Unless the circumstances clearly warrant removal, the testator’s choice of Personal Representative should be respected. The onus is on an applicant to satisfy the Court on a balance of probabilities that removal is warranted.
In Her Ladyship’s decision, Justice Gogan provides a very useful and comprehensive overview of the duties and responsibilities of a Personal Representative. Some of these are found directly in the Probate Act while others have been developed through jurisprudence.
Justice Gogan stated her opinion that the primary guide the Court must follow in deciding whether or not to remove a Personal Representative is the welfare of the beneficiaries. Her Ladyship noted that, in and of itself, a conflict or discord between a Personal Representative and beneficiaries does not justify removal. There would need to be more. She also noted that a conflict of interest between the interests of the Personal Representative and those of the estate will always draw the close scrutiny of the Court and can by itself justify removal of the Personal Representative.
In Ms. Murphy’s defence of the application to remove her as Personal Representative, she gave evidence as to the alleged wishes of her father. These were said to include: a desire that his will not be probated; that the balance of any funds in the joint account at his death go to Ms. Murphy; and that he specifically would not have wanted Ms. Willisko to be his Personal Representative.
Justice Gogan assessed these hearsay statements as to whether they were admissible. Ms. Murphy acknowledged the hearsay nature of the evidence but submitted that it was necessary and reliable and therefore should be admitted.
Among other factors which led Justice Gogan to rule the evidence inadmissible was section 45 of the Evidence Act. Pursuant to this section, in any action or proceeding by or against the heirs, executors, administrators, or assigns of a deceased person, an opposing or interested party is not to obtain a judgment based on his or her own testimony regarding dealings with the deceased unless that testimony is “corroborated by other material evidence”.
Justice Gogan concluded that the hearsay statements were not corroborated. Of particular interest and note were Her Ladyship’s comments regarding the joint account bank documents. Ms. Murphy asserted that these documents demonstrated her father’s intention that she receive the balance of the funds upon his death. Justice Gogan disagreed. She concluded the documents did demonstrate the father’s intention that Ms. Murphy be able to access the accounts. The evidence showed that Ms. Murphy was assisting with her father’s financial affairs and her father had signed a Power of Attorney naming Ms. Murphy as his Attorney. Justice Gogan commented that adding Ms. Murphy as a joint account holder was not “an unusual arrangement” in the circumstances. The bank documentation was deemed insufficient to corroborate Ms. Murphy’s statement that her father intended her to retain the money in the account.
Justice Gogan concluded it was appropriate for Ms. Murphy to be removed as Personal Representative. She cited the following in support of the decision:
- Delay in finding and producing the will;
- Failure/refusal to obtain a Grant of Probate;
- The conflict of interest created by her claim that the money in the joint back account was hers and the delay in taking steps to have this issue determined; and
- A general failure by Ms. Murphy to properly appreciate and accept her duty as Personal Representative to act in the best interests of the beneficiaries.
Justice Gogan allowed the application and awarded costs in favour of the applicant.
This case provides a very useful overview and reminder with respect to the duties of a Personal Representative and the circumstances when it is appropriate that a Personal Representative be removed.