Laing Estate v. Nova Scotia (Attorney General)

Laing Estate v. Nova Scotia (Attorney General) Court Court of Appeal Date 2011-07-07 Citation 2011 NSCA 63 Docket CA 338186 Judge/Registrar/Adjudicator MacDonald, J. Michael (Honourable Chief Justice) (CA); Fichaud, Joel E. (Honourable Justice) (CA); Oland, Linda L. (Honourable Justice) Document Type Decision Relations Library Sheet - Laing Estate v. Nova Scotia (Attorney General) - 2011 NSCA 63 - 2011-07-07 - Library Sheet Decision Content NOVA SCOTIA COURT OF APPEAL Citation: Laing Estate v. Nova Scotia (Attorney General), 2011 NSCA 63 Date: 20110707 Docket: CA 338186 Registry: Halifax Between: Barbara Palmer, Administrator, as Personal Representative of the Estate of Allan P. Laing Appellant v. The Attorney General of Nova Scotia representing Her Majesty the Queen in right of the Province of Nova Scotia Respondent Judge(s): MacDonald, C.J.N.S., Oland and Fichaud JJ.A. Appeal Heard: June 6, 2011, in Halifax, Nova Scotia Held: Appeal allowed per reasons for judgment of Fichaud, J.A.; MacDonald, C.J.N.S. and Oland, J.A. concurring. Counsel: Allen C. Fownes, for the appellant Michael T. Pugsley, for the respondent Reasons for judgment: [1] The testator died in 1943. Her executors could not locate the residual beneficiary under her will. That beneficiary died in 1959. In 1994 the undistributed residue was paid to the provincial Minister of Finance under the Public Trustee Act. In 2009 the deceased beneficiary’s personal representative, having learned of the remittance to the Minister, claimed that amount plus interest from the Province under the procedure in the Public Trustee Act. There is no issue about repayment of the capital. But the Province and the beneficiary’s representative dispute the rate of interest payable by the Province. Background [2] On February 20, 1943, Christina Laing died in Halifax. The executors of Ms. Laing’s Estate dealt with the specific bequests including a life estate, leaving an undistributed residue after the life beneficiary’s death. Ms. Laing’s will named her son, Allan P. Laing, as the residual beneficiary. When the time came to distribute the residue, the executors could not locate Allan P. Laing, and for many years the residual funds remained with the Estate in trust. By 1994 Royal Trust was the only remaining executor of Christina Laing’s Estate. [3] Section 28(1) of the Public Trustee Act, R.S.N.S. 1989, c. 379 provides that, when a beneficiary cannot be located, the executor may apply to court for an order that the assets be transferred to the Public Trustee. On April 7, 1994, upon application by Royal Trust, a judge of the Supreme Court of Nova Scotia authorized payment of the Estate’s residual funds to the Public Trustee under s. 28(1), and discharged Royal Trust from its duties. Royal Trust then transferred the balance, being $392,591.93, to the Public Trustee. [4] Section 28(2) of the Public Trustee Act says that any such funds received by the Public Trustee “shall be ... paid immediately to the Minister of Finance and the provisions of Sections 35 or 35A shall apply mutatis mutandis thereto”. According to the Schedule in evidence from the Province, on May 30, 1994 the Public Trustee paid $392,441.33 to the Minister of Finance, and on September 21, 1994 the Public Trustee transferred the remaining $150.60 to the Minister of Finance, for a total of $392,591.93 (“Capital”). [5] Section 35 of the Public Trustee Act, says: Limitation period for money held by Minister 35 (1) Any person claiming to be entitled to any money held by the Minister of Finance under this Act or to any interest therein may make application to the Supreme Court or a judge thereof for a judgment or order declaring his rights in respect thereto (a) if a claim thereto is made within ten years next after the same has been paid over to the Minister of Finance; or (b) where the person entitled to such money is under the age of nineteen years or of unsound mind or out of the Province, a claim thereto is made by such person within ten years next after his coming to or being of full age, of sound mind or returning to the Province, and in any event within forty years next after the same has been paid to the Minister of Finance, and the Court may direct such inquiries as may be necessary to determine the same and may finally adjudicate thereon but no such application shall be entertained unless security for costs is given by the applicant if the Public Trustee demands the same. (2) Where the Supreme Court or a judge thereof has determined that a person is entitled to money held by the Minister of Finance or any part thereof, he shall pay the same to that person with such interest as the Governor in Council shall direct. (3) Where the Governor in Council is satisfied that any person should receive any money referred to in subsection (1), the Governor in Council may authorize the Minister of Finance to pay such money to such person with such interest as he shall deem fit. [6] Unknown to the executors of Ms. Laing’s Estate, Allan P. Laing had died on April 16, 1959. The State of California (Mr. Laing’s domicile at his death) has issued Letters of Administration and an Order for Probate. The appellant, Barbara Palmer, is the Administrator and Personal Representative of Allan P. Laing’s Estate. [7] In November 2009 Ms. Palmer, under s. 35 of the Public Trustee Act, applied to the Supreme Court of Nova Scotia for an order that the Province of Nova Scotia pay to the Estate of Allan P. Laing the Capital of $392,591.93, that had been transferred by Royal Trust to the Public Trustee in 1994, plus interest. Ms. Palmer’s affidavit says that, upon payment, she will “distribute the Estate in accordance with the laws of the State of California, paying all just debts, testamentary expenses as may be allowed by the Supreme Court of California”. [8] Section 28(2) of the Public Trustee Act says the funds from the estate are payable by the Public Trustee to the “Minister of Finance”. In the Supreme Court the respondent was styled “The Honourable Minister of Finance, Government of Nova Scotia”. By s. 12 of the Proceedings against the Crown Act, R.S.N.S. 1989, c. 360, the respondent’s proper designation is “The Attorney General of Nova Scotia representing Her Majesty the Queen in right of the Province of Nova Scotia”. In the Court of Appeal, the parties consented to re-style the respondent to conform with s. 12, and the style of cause in this decision reflects that change. In the body of these reasons I will refer to the respondent as “the Province”. [9] There is no issue respecting entitlement to the Capital. The only dispute relates to the calculation of interest on the Capital from 1994, when the Province received the funds, to the date of the Capital’s payment to Ms. Palmer as representative of Allan P. Laing’s Estate. [10] Justice Glen McDougall heard Ms. Palmer’s application on February 16, 2010, and issued a decision on August 10, 2010 (2010 NSSC 306). Later I will discuss the evidence and governing statutory provisions. The judge held that the interest rate payable by the Province was Prime less 3.5 %. The judge’s reasons were: DECISION: [25] The only requirement for the payment of interest on the funds that were paid first to the Public Trustee under section 28 of the Act and immediately passed on to the Minister of Finance is at a rate to be determined by the Governor in Council. For the Court to impose a rate higher than the rate paid by the Province’s Bank on funds deposited to the Consolidated Revenue Fund, it would require a specific legislative provision authorizing it to do so. Furthermore, the Minister did not profit from the investment of the funds at the expense of the Estate by earning more interest than the Governor in Council is prepared to pay out. [26] In the circumstances of this case, the provisions of the Trustee Act, supra, have no application. As such, the applicant is only entitled to the original value of the assets turned over to the Public Trustee pursuant to section 28 of the Act plus interest at a rate negotiated by the Province of Nova Scotia with its bankers on all funds deposited to the Consolidated Revenue Fund - that being Prime less 3.5%. The exact amount of accrued interest will be left to the appropriate people in the Department of Finance to calculate. [11] The judge’s Order of September 28, 2010 quantified the interest at the rate of prime less 3.5% as $125,882.27: IT IS HEREBY ORDERED that the Applicant be paid the sum of $392,591.93 plus interest of $125,882.27, plus solicitor and client costs of $12,500 plus HST plus disbursements for a total of $14,947.12 for costs/disbursements; [12] The judge’s Order also directed that the Minister pay the Capital less administration costs and provided for payment of litigation costs. Those provisions of the Order have not been appealed to this court. Issue [13] Ms. Palmer appeals the judge’s selection of Prime less 3.5%. The only question is whether the judge erred by using that rate. Standard of Review [14] The judge must be correct on issues of law and not commit a palpable and overriding error on issues of either fact or mixed fact and law with no extractable legal error. Housen v. Nikolaisen, [2002] 2 S.C.R. 235, at paras 8, 10, 19-25, 31-36. H.L. v. Canada (Attorney General), [2005] 1 S.C.R. 401, at paras 4, 65, 69, 72-74. F.H. v. McDougall, [2008] 3 S.C.R. 41, para 55. Analysis [15] Ms. Palmer’s factum refers to s. 35 of the Provincial Finance Act, R.S.N.S. 1989, c. 365, as amended: 35. Subject to Section 36, the Minister shall, for the sound and efficient management of any sinking fund, the Public Debt Management Fund, the Consolidated Fund and any special funds, establish and adhere to investment policies, standards and procedures that a reasonable and prudent person would apply in respect of a portfolio of investments and loans to avoid undue risk of loss and to obtain a reasonable return. [16] The Provincial Finance Act was replaced by the Finance Act, S.N.S. 2010, c. 2, ss. 157 and 2(m), which (by s. 158) came into effect August 1, 2010, after Ms. Palmer filed her application in the Supreme Court. The former s. 35 would apply to this matter. In any case, s. 19(1) of the new Finance Act, is similar to the former s. 35. [17] Ms. Palmer submits that s. 35 of the former Provincial Finance Act binds the Province by the standard of a “reasonable and prudent person ... to avoid undue risk of loss and to obtain a reasonable return”. Her factum figuratively asks: “[W]ould not a reasonable rate of return be that interest rate which is paid to 10 year long term bondholders of the Province of Nova Scotia, using the date 1994 when the funds came to the Minister of Finance, calculated to the date of renewal of such notional bond on the 10 year anniversary in 2004 ... to the date of payout, perhaps discounted appropriately for redemption of the notional bond when the payout occurred in 2010.” That is the rate requested by the Relief Sought in Ms. Palmer’s factum. [18] I respectfully disagree with Ms. Palmer’s submission. The submission assumes that the court has a similar latitude to fashion an interest rate as would obtain for prejudgment interest in a damages claim. The Judicature Act, R.S.N.S. 1989, c. 240, s. 41(i), that applies to a damages claim, permits a court which awards damages to include interest “at such rate as it [ie. the court] thinks fit”. But this is not a damages claim and s. 41(i) of the Judicature Act is not the court’s authority to award interest. [19] The money was paid to the Public Trustee, then to the Minister of Finance, under the authority of s. 28 of the Public Trustee Act. Section 28(2) says that, upon payment by the Public Trustee to the Minister of Finance, “the provisions of ss. 35 or 35A shall apply”[emphasis added]. Section 35(1) of the Public Trustee Act permits an application to a judge for an order declaring the applicant’s entitlement “to any money held by the Minister of Finance under this Act”. Section 35 is the authority for Ms. Palmer’s application. Her Notice of Application requests a determination of the adequacy of the interest calculation under s. 35(2) of the Public Trustee Act. Section 35(2) says that the Minister of Finance “shall pay the same to that person with such interest as the Governor in Council shall direct”[emphasis added]. Section 35(3) says, alternatively, that “the Governor in Council may authorize the Minister of Finance to pay such money to such person with such interest as he shall deem fit”. [20] The Legislature has prescribed that, for repayment of funds transferred to the Minister of Finance under s. 28 of the Public Trustee Act, the Governor in Council - not the court - selects the formula to determine the interest rate. The question is not - What does the court consider to be reasonable interest? Rather the question is - What has the Governor in Council directed or authorized under ss. 35(2) or 35(3)? [21] Given the delegation of authority to the Governor in Council by ss. 35(2) and (3), one might expect to see a regulation enacted by order in council directing an interest rate formula under s. 35(2) or authorizing the Minister to act under s. 35(3). Such a regulation exists in a neighbouring context of this statute. Section 31(1) of the Public Trustee Act says that the interest payable on money in the “common fund” held by the Public Trustee “shall be at such rate as the Governor in Council may prescribe”. Then s. 42 authorizes the Governor in Council to enact regulations “to carry out the intent and purpose of this Act”. Under ss. 31 and 42, the Governor in Council has enacted the Fees and Interest Rates Regulations O.I.C. 91-1270 as Nova Scotia Regulation 231/91. Section (a) of those Regulations says that, with some exceptions, “the Governor in Council ... is pleased ... to order the prescribed rate of interest payable in respect of estates on the money which forms the common fund shall be a floating rate ascertained by the Public Trustee half-yearly and be one percent less than the rate arrived at by averaging the lowest rates offered during the period on savings - non-chequing accounts by the Canadian Imperial Bank of Commerce and the Royal Bank of Canada at their respective main Halifax branches;” Section 31(1) of the Act and the Fees and Interest Rate Regulations do not apply to this case. That is because the money from the Laing Estate, having been paid to the Minister of Finance in 1994, is not in the Public Trustee’s common fund. There is no equivalent regulation under ss 35(2) and 42 to govern interest rates on moneys that have been paid to the Minister under s. 28(2). [22] Neither the evidence adduced before the chambers judge nor the appeal record in this court contains an order in council that either states the direction of the Governor in Council on the interest rate under s. 35(2) or authorizes the Minister of Finance to determine the interest rate under s. 35(3). [23] The only basis for an inference of the Governor in Council’s direction or authority respecting the interest rate under s. 35 is an affidavit of Christina Swain, a Financial Services Officer with the Department of Finance. Her affidavit, submitted by the Province, refers to an interest rate of Prime less 3.5% and attaches exhibits which the Province submitted support that rate. None of those exhibits is authored by the Governor in Council. Ms. Swain’s affidavit outlines Departmental practice, and the Province asks the court to accept that practice as evidence of what the Governor in Council has directed or authorized. [24] The judge’s reasons adopted the Province’s approach by finding (para 25) that Prime less 3.5% is what “the Governor in Council is prepared to pay out”, and (para 26) “ the applicant is only entitled to ... interest at a rate negotiated by the Province of Nova Scotia with its bankers on all funds deposited to the Consolidated Revenue Fund - that being Prime less 3.5%”. The judge’s order (above para 10) directed the Province to pay the interest calculated at Prime less 3.5%. The judge found the Governor in Council’s direction or authority under ss. 35(2) or (3) in Ms. Swain’s affidavit. On appeal, the Province asks this Court to affirm the judge’s order. [25] So I will turn to Ms. Swain’s affidavit, which says: 5. That the policy of the Department of Finance where a sum in an intestacy exceeds $10,000, is for the Court to determine ownership at law of the amount where an applicant for the sum presents themselves. That attached hereto is policy documentation relevant to this as Exhibit ‘A’. Exhibit A includes the first seven pages of text of the “Department of Finance Policy Respecting Applications to the Minister of Finance Pursuant to Section 35(3) of the Public Trustee Act”. The bottom of the seventh page ends in mid-sentence. Any continuation was not attached to Ms. Swain’s affidavit for Justice McDougall and was not in the appeal record for the Court of Appeal. The seven pages of this policy that are before the court primarily address how the applicant must prove entitlement, and do not specify an interest formula. [26] Ms. Swain’s affidavit then discusses process: 6. That the Department of Finance has been served with the claim made in this matter for the sum of approximately $392,000 plus interest. 7. That the position of the Department is that such sum, which is an unusually high amount for an intestacy claim, exceeds the threshold within which the Department makes assessments as to ownership, pursuant to the policy communicated in Exhibit “A”. Ms. Swain’s paragraph 7 appears to refer to the statement in the Policy, para 5(b): As a result of the increased complexity of applications of this nature, the Minister of Finance requires primary evidence of the above (unless otherwise indicated) and in any event, will not distribute funds in respect of claims in excess of $10,000. For all claims in excess of $10,000 the Minister of Finance will direct the applicant to Section 35(1) of the Act pursuant to which the applicant is entitled to make an application to the court. I understand this to mean that, for claims exceeding $10,000 such as Ms. Palmer’s, the Department’s policy is to seek the court’s direction by insisting that the claimant apply under s. 35(1). [27] The remaining four paragraphs of Ms. Swain’s affidavit address interest: 8. That as to interest on any amount owing, the practice of the Department of Finance has always been to pay prime less three and one-half percent to an applicant found to be entitled to funds on an intestacy such as this. That attached hereto as Exhibit “B” is a copy of the Agreement between the Province and the Royal Bank and a copy of a cover note from Ms. Bonnie Dickens (Finance) as to the policy to pay prime less 3.5% on trusteed bank accounts. 9. That attached hereto as Exhibit “C” is a copy of the draft table of interest prepared by the Department of Finance for the estate in question. The practice of the Department of Finance is for an Order in Council to issue with up to date interest calculated in the event a Court Order issues. 10. That attached hereto as Exhibit “D” is a copy of an email that I sent to counsel for the Crown in this case setting forth the policy of the Crown regarding the keeping of funds such as this. 11. That attached hereto as Exhibit “E” is a copy of a letter of July 15, 1996 confirming that an analysis was done of interest rates on this kind of account and that prime less 3.5 per cent was found at that time to be the best rate. This is what is followed today. Later (paras 30-31, 38-40) I will discuss Ms. Swain’s exhibits. [28] The judge’s comments were: 18. Sub-section (2) of section 35 provides that where the Court has determined that a person is entitled to the money (or any part thereof) held by the Minister then he “shall pay the same to that person with such interest as the Governor in Council shall direct.” [Justice McDougall’s underlining] 19. Sub-section (3) of section 35 also provides for a determination of entitlement to any such funds by the Governor in Council without the requirement of a Court application. Presumably this procedure is open to the Governor in Council but utilized for amounts less than $10,000.00 by virtue of policy. Under this sub-section the rate of interest payable is determined by the Minister, not by Cabinet. 25. ... For the Court to impose a rate higher than the rate paid by the Province’s Bank on funds deposited to the Consolidated Revenue Fund, it would require a specific legislative provision authorizing it to do so. Furthermore, the Minister did not profit from the investment of the funds at the expense of the Estate by earning more interest than the Governor in Council is prepared to pay out. 26. ... the applicant is only entitled to ... interest at a rate negotiated by the Province of Nova Scotia with its bankers on all funds deposited to the Consolidated Revenue Fund - that being Prime less 3.5 %. [29] Does the record support the judge’s findings? [30] Paragraph 8 of Ms. Swain’s affidavit attaches as Exhibit “B” page 1 of a “Banking Services Pricing Agreement” between the Province and the Royal Bank of Canada. The rest of the Agreement, including the signature page, is not attached to the affidavit. Page 1 of this Agreement says: INTEREST ARRANGEMENT a) Trusteed Deposit Service Interest will be calculated on the average daily account balance, or at account closing, at a rate equivalent to RBC Royal Bank Prime Rate less 3.50%. b) Canadian Dollar Current Accounts Interest will be based on the average monthly credit balance, regardless of whether the accounts are netted for interest purposes, or operate independently of the Consolidated Offset Balance Control [COBC] structure. Interest will be paid on the first day of the month, for the previous month’s balances at a rate equivalent to RBC Royal Bank Prime Rate less 2.00%. The provision then mentions U.S. Dollar Current Accounts that are not relevant to this case. [31] So the Province has a Trusteed Account that earns Prime less 3.5%, and a Canadian Dollar Current Account that earns Prime less 2%. [32] The Province’s factum to the Court of Appeal says: 14. The instructions received by counsel for the Crown is [sic] the funds went into the common fund of the Crown and earned interest at prime less 2 per cent. [33] At the chambers hearing, Justice McDougall and counsel for the Province had the following exchange: MR. PUGSLEY: My take on it, My Lord is that because the government’s a big customer right what it does is it has a Trustee bank account and it earns prime less three and a half percent on that. But it also has a common fund. And the common fund or current account is the province’s main operating account so if you imagine a customer of the bank that has both a Trustee account and a main account. Because it has so much revenue that’s passing through its hands. It’s able to feel comfortable in depositing funds that it gets with respect to intestacies in the common fund, it’s a big enough, solvent enough customer that it’s not at risk for being – have a shortfall with respect to its Trustee exposure that it needs to deposit the intestacy funds in that Trustee account. It then deems the appropriate rate of interest for those intestacies to be prime less two percent. That’s what it gets from the bank on its actual Trusteed account. But because it has the flexibility or the size to be able to keep the funds in its current account it earns prime – it earns prime – sorry it earns prime less two on its current and prime less three and a half on the Trusteed account. So it makes a point and a half in that sense in this kind of intestacy. THE COURT: Okay. [Transcript pages 43-44] ... MR. PUGSLEY: ...So the Crown makes one and a half percent on the spread but that’s only because it’s so big that it’s got the business commercial clout to be able to do that. My Friend would reply well, you shouldn’t profit in your role as a Trustee. But we’re not profiting as - in a role as Trustee per se. The profit is because as the government were [sic - we’re] a big enough commercial client of the bank to be able to have and run a current account that lets us earn prime plus two. [Transcript, pages 68-69] [34] The judge (para 26) said Ms. Palmer was entitled to the “rate negotiated by the Province of Nova Scotia with its bankers on all funds deposited to the Consolidated Revenue Fund - that being Prime less 3.5%”. In fact, that rate for moneys in the Consolidated Revenue Fund (the Current Account or common fund) is Prime less 2%. [35] The judge also said (para 25) that “the Minister did not profit from the investment of the funds at the expense of the Estate by earning more interest than the Governor in Council is prepared to pay”. This was based on the judge’s erroneous assumption that the Consolidated Revenue Fund’s Current Account, which had received the Laing moneys, earned Prime less 3.5%. In fact that account earned Prime less 2% and, by paying Prime less 3.5% to Ms. Palmer, the Province would profit by 1.5%. [36] The judge’s findings mentioned in the preceding two paragraphs were palpable and overriding errors of fact. Counsel for the Province was commendably candid with the chambers judge and with this court on the admissions of fact that are quoted above (paras 32-33). There was no contrary evidence to support or explain the judge’s erroneous assumption that the Laing Estate funds had actually earned Prime less 3.5%. [37] How do these conclusions affect the interest rate payable on the Laing Estate Capital? I will discuss the evidence first, then the chambers judge’s assumption and lastly the underlying principle of equity. [38] Ms. Swain’s affidavit, para 8 refers to the Province’s Banking Services Pricing Agreement with the Royal Bank and to “a cover note from Ms. Bonnie Dickens (Finance) as to the policy to pay prime less 3.5% on trusteed bank accounts” [emphasis added]. That cover note from Ms. Dickens refers to “the agreement between the Province of Nova Scotia and the Royal Bank in regard to Finance’s policy on interest paid on trusteed bank accounts” [emphasis added]. As noted, under the Banking Services Pricing Agreement, the Royal Bank pays the Province Prime less 3.5% on the Trusteed Account. [39] Ms. Swain’s affidavit, para 11 cites a 1996 letter from the Department of Finance on another file concerning the interest rate policy and says “This is what is followed today”. The Department’s 1996 letter is titled “Re: Payment out of Court on Surplus Funds Over Five Years Old” and says: The interest rates used are the rates we receive from our bank accounts. We have had an analysis done in the past year to determine how competitive these rates are (prime less 3.50%), and found that these were the best rates, given no service charges from the major banks in the Halifax area. [emphasis added] [40] From this evidence it appears that the policy is for the Province to pay the interest rates that the Province “receive[s] from our bank accounts” for the moneys in question. On moneys deposited into the Trusteed Account, the usual situation, that would be Prime less 3.5%. But in the unusual case that the funds are deposited into the Consolidated Revenue Fund’s Current Account, the rate to be paid by the Province would be the rate received by the Province for that account - in this case, according to counsel’s stipulation to the Supreme Court and to the Court of Appeal, Prime less 2%. [41] That conclusion is consistent with the principle underlying the judge’s ruling in the decision under appeal. The judge (para 26) said that Ms. Palmer was entitled to the rate that the judge (erroneously) believed had been earned by the Province on the Laing Estate moneys in the Consolidated Revenue Fund. The judge rejected the notion that the Province should pay a higher rate than the Province had actually earned. But the judge assumed that the Province should pay no less than the Province had earned. [42] The notion that the Province should pay to the beneficiary the interest the Province earned stems from the basic tenet of equity that a trustee should not profit from his trust, except as authorized specifically by law or the trust instrument. In Bray v. Ford, [1896] A.C. 44 (H.L.), at p. 51 Lord Herschell, in a venerable passage, said: “It is an inflexible rule of a Court of Equity that a person in a fiduciary position ... is not, unless otherwise expressly provided, entitled to make a profit”. This principle may inform the interpretation of the scope of delegated discretion respecting the choice of an interest rate in legislation such as s. 35(2): Public Trustee v. Movesian Estate, (1994) 73 O.A.C. 140 (C.A.), paras 35-37. [43] Mr. Laing or his Estate had a beneficial interest in the funds when the executor was Royal Trust until 1994. This interest remained when the funds rested briefly with the Public Trustee in 1994 and would have continued had the Province deposited the funds into its Trusteed Account. That the Province unilaterally decided to deposit the funds into its Current Account, instead of its Trusteed Account, does not dissipate the beneficiary’s interest. The Province deposited the funds into its Current Account for the purpose of generating the earnings spread of 1.5%. Had a beneficiary’s claim never materialized, the Province would have kept those additional earnings. But Allan P. Laing’s Estate, though tardy, has appeared and its time limitation under s. 35(1)(b) has not expired. There is a beneficiary and the Crown does not own the funds by bona vacantia. That the beneficiary’s discovery of the unclaimed estate may be serendipitous leaves untouched the principle that a trustee should not profit from that estate. Nor does the beneficiary’s interest fade because - the Province’s rationale - his trustee happens to be a substantial entity with the commercial clout to negotiate a better earnings rate with the trustee’s bank. A trustee and beneficiary are not co-venturers, and the trustee cannot pocket or split the profit just because his investment choice or bargaining leverage has earned a return 1.5 % higher than an alternative. [44] This principle of equity converges, as I have discussed, with both (1) the evidence from Ms. Swain’s affidavit as to the Province’s interest reimbursement policy and (2) the chambers judge’s assumption that the direction or authority from the Governor in Council was that the interest payable be no more, but also no less, than the interest the Province actually earned. Conclusion [45] As noted earlier (para 26), the Province’s written policy is to insist that a claimant obtain the court’s view under s. 35 before the Province makes a payment toward a claim exceeding $10,000, such as Ms. Palmer’s claim. My view is that, absent a regulation enacted by order in council on the topic, the Province must pay interest at the rate that the Province actually earned in the account where the Christina Laing Estate moneys were deposited, ie. Prime less 2%. This would be subject to the same deductions for administration, costs, HST and disbursements that were stated in the judge’s Order and were not appealed. [46] I would allow the appeal by ordering that the calculation of interest payable to Ms. Palmer, as Administrator and Personal Representative of the Estate of Allen P. Laing, be at the rate of Prime less 2%, instead of Prime less 3.5%, with the calculation to be performed by the Department of Finance. I would order the Province to pay to the Appellant costs for the appeal of $2,000 all inclusive. Fichaud, J.A. Concurred: MacDonald, C.J.N.S. Oland, J.A.