National Trust Co. Ltd. v. Osadchuk

National Trust Co. Ltd. v. Osadchuk

The transactions amounted to a sale by the trustee (the company) to itself as administrator, which the law does not permit; therefore the appellant must be held to have $3,000 of trust funds uninvested and must account for interest at 5% per annum from March 18, 1920, with half-yearly rests, and may not charge for expenditures or retain receipts relating to the mortgaged properties.

Citation
[1943] SCR 89
Parties
Defendant/appellant; Administrator De Bonis Non of the Estate of Anton Osadchuk, Deceased: National Trust Company Limited; Plaintiffs/respondents (beneficiaries): Nicholi Osadchuk and Others
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
2 February 1943
Procedural Posture
Appeal / Supreme Court of Canada Judgment on Appeal From the Court of Appeal for Saskatchewan
Outcome
Appeal dismissed with costs; judgment below affirmed by majority and amended to provide for interest accounting as ordered
Legal Topics
Administrator De Bonis Non, Self Dealing by Trustee, Accounting by Trustee, Allocation of Investments to Estate, Interest on Trust Funds
Source Language
English
Estates Trusts and Trustees Equity Mortgages Administrator De Bonis Non Self Dealing by Trustee Accounting by Trustee Allocation of Investments to Estate +1 more

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Parties

National Trust Company Limited

Defendant/appellant; Administrator De Bonis Non of the Estate of Anton Osadchuk, Deceased

Nicholi Osadchuk and Others

Plaintiffs/respondents (beneficiaries)

Procedural Posture

Appeal / Supreme Court of Canada Judgment on Appeal From the Court of Appeal for Saskatchewan

Legal Issues

  1. 1 Whether mortgages taken in the trustee's own name and debited to the estate constituted a valid allocation of investments to the estate or a prohibited sale by trustee to itself
  2. 2 Whether the appellant as administrator must account for $3,000 as uninvested trust funds
  3. 3 Whether the appellant may charge expenses or retain receipts related to the mortgages

Ratio Decidendi

The transactions amounted to a sale by the trustee (the company) to itself as administrator, which the law does not permit; therefore the appellant must be held to have $3,000 of trust funds uninvested and must account for interest at 5% per annum from March 18, 1920, with half-yearly rests, and may not charge for expenditures or retain receipts relating to the mortgaged properties.

Court Disposition

Appeal dismissed with costs; judgment below affirmed by majority and amended to provide for interest accounting as ordered

Orders

  • Accounts referred back to the Surrogate Court to be dealt with on the basis that the appellant holds $3,000 of trust funds uninvested
  • Appellant to be debited in the Surrogate Court with $3,000 and to account for interest at 5% per annum from March 18, 1920 with half-yearly rests to final passing of accounts