Yeh Estate (Re)

2016 BCSC 1550 Yeh Estate (Re) IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Yeh Estate (Re), 2016 BCSC 1550 Date: 20160823 Docket: S162459 Registry: Vancouver In the Matter of the Estate of Ruey-Chang Yeh, deceased Between: Daniel Chih-Hsiu Yeh and Paul Po-Yih Yeh Petitioners And Yumin Syukur, as Executor of the Will of Ruey-Chang Yeh, deceased Respondent Before: The Honourable Mr. Justice Williams Reasons for Judgment Counsel for the Petitioners: K.G. McKenzie Counsel for the Respondent: D. Frenette Place and Date of Hearing: Vancouver, B.C. July 7, 2016 Place and Date of Judgment: Vancouver, B.C. August 23, 2016 [1] The petitioners, Paul Po-Yih Yeh and Daniel Chih-Hsiu Yeh apply for an order removing the respondent, Yumin Syukur, as executor and trustee under the last will of the deceased, Ruey-Chang Yeh, their father. The petitioners seek an order appointing them as executors and trustees in substitution for the respondent. They also seek an order vesting all assets, real and personal, of the deceased's estate in them. [2] The respondent opposes their application and says her status as executor and trustee should not be disturbed. As well, she has filed an application seeking a series of other orders related to the dispute, including: a. an order, on short notice, for substantial document disclosure by the petitioners; b. an order for cross-examination of the petitioner Paul Yeh on his affidavit; and c. an order for an examination under oath of the petitioner Daniel Yeh. Alternatively, she seeks an order of the Court converting the petition to an action. The Circumstances [3] The circumstances are set out in the petition as follows: a) The deceased purchased property at 950 Glenora Avenue, North Vancouver, British Columbia (the "Property"), on January 27, 2015. b) On August 25, 2015, the deceased married Ms. Syukur. c) On December 31, 2015, the deceased executed his will, in which he bequeathed the Property to the petitioners. d) The deceased named the respondent as executor of the will and trustee of his estate. His sons, Paul and Daniel, were named (jointly) as alternative executors/trustees. e) On December 31, 2015, the solicitor who prepared the will also prepared a general power of attorney naming the respondent as the deceased's attorney. f) On January 25, 2016, the respondent registered the power of attorney at the New Westminster Land Title Office. g) On January 25, 2016, the respondent, using the power of attorney, transferred the Property to her daughter, Arianne Marita Xie Boivin. The Form A Freehold Transfer was executed on January 25, 2016, and was registered in the Land Title Office on January 28, 2016. h) On January 25, 2016, a Form A Freehold Transfer was executed by Ms. Boivin; she transferred the Property back to the respondent. The Form A Freehold Transfer was registered in the New Westminster Land Registry on February 9, 2016. i) On January 26, 2016, the deceased died. [4] In his will, the deceased bequeathed to his sons, the petitioners, in equal shares, all of his "right title and interest in and to the real property located at 950 Glenora Avenue, in the city of North Vancouver." He also bequeathed to the respondents, in equal shares, all of his "right title and interest in and to the real property located at 91-2, Hin Tong Town, Ho Pi Village, Tainan County, Taiwan." The "rest and residue" of his estate was bequeathed to his wife, the respondent. [5] The essential claim of the petitioners is that the deceased intended they should have his interest in the Property. They say the respondent has, through the use of the power of attorney, taken that asset from the estate and caused it to be registered in her name. [6] In the submission of the petitioners, the Court should declare that she holds the title to the North Vancouver property in trust. They say as well that, given the controversy, the respondent cannot properly continue as the executor of the will. In their submission, the role of the executor is to maintain the will. They say that by taking the steps she has, and by challenging the will, she has placed herself in an untenable position and should be replaced as executor and trustee. [7] The petitioners say that the respondent's proper course of action is to bring an action challenging the will under the variation provisions of the Wills, Estates and Succession Act, S.B.C. 2009, c. 13 [WESA]. [8] The respondent says that the facts are far more complicated and nuanced than the petitioners claim them to be. There are circumstances she says are relevant in understanding the actual state of affairs. Specifically, the respondent claims the following: a) The deceased and the respondent became friends in December 2005 and began dating in April 2008. They were engaged in February 2013. b) The respondent and the deceased were looking for a home that they could share and had been doing so since 2010. c) On January 27, 2015, the deceased purchased the Property, partially financed by a mortgage obtained from the CIBC in the approximate amount of $450,000. d) The respondent contributed $2,000 per month to the mortgage, beginning February 27, 2015. e) The deceased and respondent married in August 2015. f) Following the marriage, the respondent and the deceased reached an agreement that she would contribute $1,500 per month towards the mortgage. g) In addition to the mortgage payment, the respondent also paid for renovation costs for the home and other design and decorating costs. h) In November 2015, the deceased learned that he had inoperable and advanced colon cancer. i) Knowing he did not have long to live, the deceased set about making legal arrangements for his estate planning in November and December 2015. j) The deceased's estate plan was to put her on title to the Property, giving her a 60% interest. He intended to leave his own 40% interest in the Property, by his will, to be divided equally between the petitioners. k) He also intended to leave a property that he owned in Taiwan to the petitioners in equal shares. l) The deceased wished to leave the residue of the estate to the respondent. m) The deceased executed his will on December 31, 2015, appointing her as executor. He provided an enduring power of attorney to her on December 31, 2015. n) In order to follow through with his estate plan, the deceased needed to put the respondent on title to the Property. To that end, he made arrangements with CIBC to have the respondent added to the mortgage. A notary public was appointed to prepare the mortgage documents, and on January 21, 2016, the deceased and the respondent signed the new CIBC loan documents. o) On January 23, 2016, the deceased fell into a coma. p) On January 25, 2016, the respondent learned that she would be able to transfer title to the Property to her daughter, exempt of property transfer tax, and that the daughter could then transfer the Property back into the respondent's name. That process required the approval of the mortgage lender CIBC. The lender was not prepared to approve, and it was therefore necessary that the mortgage be paid in full. Those arrangements were made. Later that day, documents were executed to transfer title in the Property to the respondent's daughter and then to transfer the Property from the daughter to the respondent. The respondent says that was for the purpose of carrying out the deceased's estate-planning wishes. q) On January 26, 2016, the deceased died. The noted transfers of title were completed, and on February 9, 2016, the transfer of the title into the respondent's name was registered. r) On February 9, 2016, the respondent informed the petitioners that the Property had been transferred into her name and advised that each of the petitioners was to receive a 20% share of the home. Specifically, she advised that she intended to retain the home and that she wished to buy their respective interests in the Property. s) Each of the petitioners advised the respondent that they had been informed by the deceased that he wished for the respondent to have a life estate in the Property; she would not have to sell it in order to pay out the petitioners. t) The respondent understood that the petitioner Paul Yeh needed funds and wanted to cash out his interest right away. The respondent agreed to raise the necessary funds so that each of the petitioners' interest could be bought out without delay. u) There were ongoing discussions between the respondent and the petitioners with respect to the value to be used for the transaction; she provided the petitioners with the property assessment notice, as well as the amount owing on the mortgage. v) The petitioners did not engage in further discussion with her with respect to that transaction. Instead, on February 25, 2016, she received notice from the Land Title Office that the petitioners had commenced litigation. w) The respondents is ready, willing, and able to pay to each of the petitioners a 20% share of the equity in the Property, calculated as 20% of the difference between the value of the Property and the amount of the mortgage. Analysis [9] This is essentially a practical problem. [10] The underlying dispute will not be resolved in this application. That will be accomplished by either agreement of the parties or a judgment following litigation deciding whether the will should stand as drafted, how it will be construed, and how the estate will be distributed. [11] For now, my preliminary observation, and this is not in any way intended to be determinative of or binding on any subsequent trier of fact, is that there appears to be some merit to the position advanced by the respondent. She has filed a substantial body of material that supports that view. [12] For example, the petitioners say that the transfer of the Property clearly violated s. 27 of the Property Law Act, R.S.B.C. 1996, c. 377. The respondent, however, has made reference to authority suggesting that the matter is not as straightforward as the petitioners suggest. [13] However, that issue will be decided in a forum other than this, as will the merits of the matter generally. [14] I propose to take measures in this petition that are no more intrusive than necessary. Removing the respondent as executor [15] In my view, the petitioners' contention that the respondent should not be permitted to continue as executor and trustee is sound. [16] I have reviewed the authorities provided by counsel on this issue. It is clear that this Court has a broad discretion--both through its inherent jurisdiction and under s. 31 of the Trustee Act, R.S.B.C. 1996, c. 464--to remove an executor or trustee where a conflict of interest exists: see Mardesic v. Vukovich Estate (1988), 30 B.C.L.R. (2d) 170, at 173-74 (S.C.). [17] The main consideration in whether to exercise that discretion is the welfare of the beneficiaries: Thomasson Estate (Re), 2011 BCSC 481, at para. 22. Even a "perceived" conflict of interest between an executor's personal interests and her duty to act in the interests of the beneficiaries of the will can be sufficient to warrant her removal: Ching Estate (Re), 2016 BCSC 1111, at para. 22. [18] The respondent's essential position here is that the will should not be enforced as it reads on its face--that is, that the deceased's interest in the Property (as it was prior to the transfers) should not pass to the petitioners. [19] That puts the respondent in a fundamental conflict of interest. Her position in this dispute (certainly as regards the Property) is squarely at odds with her role as executor to administer the will. [20] Accordingly, I will grant the petitioners' application to remove her. [21] As for the matter of whom should be appointed in her place, I note that the deceased, in his will, has directed that if the respondent does not act, then his sons, the petitioners, should act. [22] On one hand, that may seem problematic in that they are obviously implicated in the dispute. However, their personal interests are not incongruent with the deceased's stated wishes. They say they will act to maintain the will. I see no reason to doubt that. [23] Accordingly, I will appoint the petitioners to act as executors and trustees. [24] Turning to the petitioners' request to vest all assets in the estate in themselves, I believe that order to be unnecessary. An executor, in common law, obtains title to the estate's assets from the will: Browne v. Brown Estate, 2015 BCSC 28, at para. 22. Further, s. 102(2) of WESA provides: Vesting of property on death 102 (2) The estate of a deceased person vests in the person's personal representative when the personal representative assumes or is appointed to that office. [25] Therefore, by virtue of my order that the petitioners be appointed to act as executors and trustees of the deceased's estate, the assets of the estate necessarily vest in them. [26] That will not, of course, vest any interest in the Property in the petitioners as it is no longer part of the estate. Further, an order as sought by the petitioners that that Property be transferred back into the name of the estate, or that the respondent holds the Property in trust for the estate, would require an analysis that is far beyond the scope of this petition. There will, however, be a proviso: there shall be no transaction regarding the Property by any party unless there is either agreement between the parties or the Court's approval has been sought and obtained in advance. [27] My expectation is that substantive litigation will be initiated with respect to the dispute at bar. Specifically, I would anticipate that the respondent will commence an action. With that in mind, I turn to the respondent's application. The respondent's application [28] In the respondent's application, the Court was asked to make a number of orders to enable the respondent to pursue discovery or, alternatively, convert the petition to an action. I decline to do so. [29] With regard to measures of further discovery, those seem to me to be essentially incremental and much less than the situation calls for. I am reminded of the comments of Ballance J. in Boffo Developments (Jewel 2) Ltd. v. Pinnacle International (Wilson) Plaza Inc., 2009 BCSC 1701, at para. 50: [50] [T]he Court ought to be cautious in making orders which have the objective of addressing the resolution of a bona fide triable issue through the creation of a hybrid proceeding that permits certain pre-trial and trial mechanisms to the parties, but denies them others. Where the driving underpinning for such an approach is largely one of practicality, it strikes me there is a very real risk of diminishing returns where the summary process is expanded to allow the filing of additional lengthy affidavits, cross-examination on affidavits and possibly a broader scope of cross-examination, selective document disclosure, and other features of the trial process. At some point, the process that looks like a trial, should be a trial. [30] As for the alternative remedy sought, I am not persuaded that the issues at hand, as they arise from the petition, lend themselves to that being done. In my opinion, the subject of this petition differs from what would ultimately be at issue in the trial the respondent seeks. Essentially, the relief the respondent seeks is a variation of the terms of the deceased's will. That is not at issue here, where the petitioners seek the removal of Ms. Syukur as executor of the estate. [31] The better approach is to have the respondent commence an action. [32] Given the seriousness and importance of the issues, I expect that will be done in an expedited manner. To that end, I will direct that any action to be brought by the respondent should be commenced no later than 60 days from the date of release of these reasons. In the event there has been no action commenced, the petitioners are at liberty to bring the matter back before this Court for further directions. [33] The petitioners shall have their costs. Summary [34] To summarize, I order the following: a) Ms. Syukur is removed as executor and trustee of the deceased's estate; b) Daniel and Paul Yeh are appointed as co-executors and trustees of the estate; c) No transaction is to be made with regard to the Property without agreement of the parties or Court order; and d) Costs to the petitioners. "J. Williams, J."