An executor overstepped her duties when she opposed the efforts of a dead man’s children to recover over $200,000 he sought to keep out of his estate, a court in British Columbia has ruled.
According to a decision by the Supreme Court of B.C., shortly before his death in June 2023, Albert Joseph Marcel Fredette sold his primary asset, a condo, for about $240,000. But the sale proceeds did not make it into his estate, which otherwise amounted to about only $20,000.
Fredette’s two children sought leave from the court to pursue an action to recover the sale proceeds on behalf of the estate, after efforts to persuade the executor of the estate, Shao Min Qin, to launch a recovery proceeding failed.
“The executor’s principal argument in response was that the plaintiffs had not shown that they were the children of the deceased,” the court noted. It said she opposed their efforts to pursue recovery of the proceeds of the condo sale on the basis that she wanted to respect Fredette’s wishes.
The court said Fredette believed he was infertile and that his children, who were from two different marriages, were the result of both mothers cheating on him — although genetic testing showed they were his children.
Based on his belief they weren’t his children, both were excluded from his will.
However, the court granted leave for them to pursue the possible recovery of the proceeds from the condo sale on behalf of the estate, ruling that they have standing to make that claim, as they “are the deceased’s biological children and that there is an arguable case that an action to recover the amount transferred to unknown third parties is ‘necessary or expedient for the protection of the estate.’”
The court also ordered costs against the executor on the basis that acting contrary to her duties to the estate represented “special circumstances.” She had a duty not to obstruct the estate from recovering assets, it said.
“In my view, the executor here overstepped her role. No rational explanation was given to me for why the executor would use the limited resources of the estate to oppose this application,” the court said.
While the executor may have believed she was respecting the deceased’s wishes by opposing the efforts to recover assets for the estate, “[h]er loyalty is not to an inter vivos transferee, but to the estate itself,” the court said. “This was an improper motivation, no matter how sincerely held.”
Costs were ordered against the executor personally, and the court said she can’t use the estate to fund that bill.