Royal Trust v. Barter et al.

Royal Trust v. Barter et al.

Breaches of trust by the former trustees were established; the estate is entitled to restitution equal to the loss and additional income the estate would have earned absent the breaches, totaling $528,460 as of May 31, 2000, together with declarations and proprietary remedies: the Times Square dividend is capital, Armstrong holds certain annuities and insurance in trust for the estate, a lien and sale order over the Langley property for the estate's 100/111 interest, surrender or charge over the Maritime Life policy, recovery of tax refunds, interest, and occupation rent; punitive damages and repayment of accounting fees were refused.

Citation
2000 BCSC 1842
Parties
Plaintiff, Trustee of the Estate of Douglas Carson Smith: Royal Trust Corporation of Canada; Plaintiff, Income Beneficiary: Cherie Kissandra Smith; Defendant, Executor and Trustee: Robert Barter; Defendant, Executor and Trustee: Thomas Oliver; Defendant and Plaintiff, Executor and Trustee: Pamela Armstrong
Court
Supreme Court of British Columbia
Jurisdiction
Canada
Judgment Date
21 December 2000
Procedural Posture
Trusts and Estate Litigation / Trial Judgment (reasons for Judgment)
Outcome
Judgment for plaintiff Royal Trust on breach of trust claims; award of restitution, proprietary remedies, declarations, liens, orders for sale and surrender, and interest; punitive damages and repayment of accounting fees denied; Cherie Smith awarded her 10% income share of calculated additional income ($16,680...
Legal Topics
Breach of Trust, Unauthorized Investments, Executor's Fees, Accounting and Passing of Accounts, Characterization of Dividend as Capital or Income, Set Off of Gains and Losses, Tracing and Liens on Land, Occupation Rent, Punitive Damages, Interest on Breaches
Source Language
English
Trusts Estate Law Equity Property Law Tax Law Breach of Trust Unauthorized Investments Executor's Fees +7 more

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Parties

Royal Trust Corporation of Canada

Plaintiff, Trustee of the Estate of Douglas Carson Smith

Cherie Kissandra Smith

Plaintiff, Income Beneficiary

Robert Barter

Defendant, Executor and Trustee

Thomas Oliver

Defendant, Executor and Trustee

Pamela Armstrong

Defendant and Plaintiff, Executor and Trustee

Procedural Posture

Trusts and Estate Litigation / Trial Judgment (reasons for Judgment)

Legal Issues

  1. 1 Whether trustees breached their duties and the extent of loss to the estate
  2. 2 Whether the dividend declared in the wind-up of Times Square Holdings Ltd. is capital or income for trust accounting
  3. 3 Whether gains on unauthorized investments can be set off against losses from other unauthorized investments

Ratio Decidendi

Breaches of trust by the former trustees were established; the estate is entitled to restitution equal to the loss and additional income the estate would have earned absent the breaches, totaling $528,460 as of May 31, 2000, together with declarations and proprietary remedies: the Times Square dividend is capital, Armstrong holds certain annuities and insurance in trust for the estate, a lien and sale order over the Langley property for the estate's 100/111 interest, surrender or charge over the Maritime Life policy, recovery of tax refunds, interest, and occupation rent; punitive damages and repayment of accounting fees were refused.

Court Disposition

Judgment for plaintiff Royal Trust on breach of trust claims; award of restitution, proprietary remedies, declarations, liens, orders for sale and surrender, and interest; punitive damages and repayment of accounting fees denied; Cherie Smith awarded her 10% income share of calculated additional income ($16,680...

Orders

  • Declaration that breaches of trust by Barter, Oliver and Armstrong established and estate entitled to restitution
  • Judgment for non-taxable capital receipts totaling $191,815 and additional income losses totaling $336,645, aggregate $528,460 (subject to accounting and tax adjustments)