Collett Estate, Re, (2005) 212 B.C.A.C. 304 (CA)

• Judge: Ryan, Levine and Smith, JJ.A.
• Court: Court of Appeal (British Columbia)
• Case Date: November 29, 2004
• Jurisdiction: British Columbia
• Citations: (2005), 212 B.C.A.C. 304 (CA);2005 BCCA 291

Collett Estate, Re (2005), 212 B.C.A.C. 304 (CA);

    350 W.A.C. 304

MLB headnote and full text

Temp. Cite: [2005] B.C.A.C. TBEd. MY.056

Re: The Estate of John Allan Collett and Section 88 of the Trustee Act, R.S.B.C. 1979, c. 414

(CA27886; 2005 BCCA 291)

Indexed As: Collett Estate, Re

British Columbia Court of Appeal

Ryan, Levine and Smith, JJ.A.

May 25, 2005.

Summary:

A testator died in February 1992 and was survived by his wife, Gloria, his children, Caroline and John, his grandchildren, Paula, Michael and Johnny, and Johnny's two children (the testator's great-grandchildren), Jennifer and David. In February 1993, John commenced an action against the executors and the other beneficiaries as he was not satisfied with his share of the estate. Hunter, J., ordered that the will be rewritten to include, inter alia, the great-grandchildren in the distribution of the estate. In April 1993, Gloria requested an encroachment of $1,000,000 pursuant to the power to encroach on the capital for her benefit. The amount was distributed between the children and grandchildren, without taking into account the rewritten clauses of the will that included the great-grandchildren. In 1995, the Public Trustee became involved in the proceedings as a representative of the great-grandchildren. In August 1999, Blair, J., made an order approving and settling the executors' accounts up to January 2, 1999. In July 2000, the Public Trustee filed a notice of motion for an order for a special case and for determination of the issues, notably whether the executors and trustees had failed to consider the interests of the great-grandchildren in exercising their discretion to encroach on capital in 1993.

The British Columbia Supreme Court, in a decision reported at [2000] B.C.T.C. 849, ordered, inter alia, that the distribution of the $1,000,000 made in April 1993 was not a proper exercise of discretion of the executors and had to be accounted for. The surviving executors and trustees appealed.

The British Columbia Court of Appeal, in a decision reported at 211 B.C.A.C. 299; 349 W.A.C. 299, allowed the appeal. The court held that the order was fatally flawed for procedural reasons. The court received submissions on costs.

The British Columbia Court of Appeal ordered costs accordingly.

Executors and Administrators - Topic 5548

Actions by and against representatives - Costs - Where payable out of estate - [See Practice - Topic 7455 ].

Guardian and Ward - Topic 969

Public trustee or guardian - Practice - Costs - [See Practice - Topic 7032.1 and Practice - Topic 7455 ].

Practice - Topic 7032.1

Costs - Party and party costs - Entitlement to party and party costs - Estate matters - The Public Trustee, as representative of the testator's great-grandchildren, proceeded by way of special case to determine issues related to the management of an estate - The resulting order was reversed on appeal for procedural reasons - A beneficiary, Collett, whose interests were affected by the order made, was not given notice of the special case - Further, the special case was a collateral attack on a previous order - The British Columbia Court of Appeal awarded Collett party and party costs payable against the Public Trustee - Collett's interests were affected by the impugned order and her appearance on the appeal was proper - See paragraph 17.

Practice - Topic 7455

Costs - Solicitor and client costs - Entitlement to solicitor and client costs - Estates - The Public Trustee proceeded by way of special case to determine issues related to the management of an estate - The order was reversed on appeal for procedural reasons - A beneficiary whose interests were affected by the order made, was not given notice of the special case - Further, the special case was a collateral attack on a previous order - The executor of the estate sought special costs payable by the Public Trustee - The Public Trustee sought special costs payable by the estate - The British Columbia Court of Appeal rejected both claims - The court held that "to saddle the residuary beneficiaries with the wasted costs of the special case through an order against the estate would not be proper. In these special circumstances, the Public Trustee and the executor should bear their own expenses of the special case and no orders for costs of that proceeding should be made in their favour" - While he was a successful appellant, the executor was not entitled to costs because he had concurred with the Public Trustee in bringing the flawed procedures of the special case - See paragraphs 1 to 16.

Practice - Topic 7456

Costs - Solicitor and client costs - Entitlement to solicitor and client costs - Executors and administrators - [See Practice - Topic 7455 ].

Practice - Topic 8327.2

Costs - Appeals - Costs of appeal - Solicitor and client costs - [See Practice - Topic 7455 ].

Practice - Topic 8327.6

Costs - Appeals - Costs of appeal - Party and party or partial indemnity basis - [See Practice - Topic 7032.1 ].

Cases Noticed:

Bradshaw Construction Ltd. v. Bank of Nova Scotia (1991), 54 B.C.L.R.(2d) 309 (S.C.), affd. in part (1992), 16 B.C.A.C. 62; 28 W.A.C. 62; 73 B.C.L.R.(2d) 212 (C.A.), refd to. [para. 13].

Goldman v. Kanee Estate et al. (1992), 15 B.C.A.C. 60; 27 W.A.C. 60; 69 B.C.L.R.(2d) 89 (C.A.), refd to. [para. 4].

Kanee Estate, Re - see Goldman v. Kanee Estate et al.

Turner v. Andrews et al. (1999), 24 B.C.T.C. 166; 30 E.T.R.(2d) 126; 23 C.C.P.B. 84 (S.C.), affd. (2001), 147 B.C.A.C. 305; 241 W.A.C. 305; 85 B.C.L.R.(3d) 53 (C.A.), folld. [para. 7].

Kordyban v. Kordyban et al. (2003), 186 B.C.A.C. 77; 306 W.A.C. 77; 19 B.C.L.R.(4th) 19; 2003 BCCA 455, refd to. [para. 12].

Lotzkar (No. 2), Re (1965), 50 D.L.R.(2d) 357 (B.C.C.A.), refd to. [para. 13].

Stuart, Johnson v. Williams, Re, [1940] 4 All E.R. 80 (C.A.), refd to. [para. 14].

Hillam v. Walker (1827), 1 Hagg. Ecc. 71; 162 E.R. 510, refd to. [para. 14].

Twist v. Tye, [1902] P. 92; 71 L.J.P. 47, refd to. [para. 14].

Counsel:

W.H. Grayson, for the appellants;

R.W. McDiarmid, Q.C., for the respondent.

This appeal was heard on November 29, 2004, before Ryan, Levine and Smith, JJ.A., of the British Columbia Court of Appeal. The following supplementary reasons were delivered by Smith, J.A., on May 25, 2005.