



COURT OF APPEAL FOR ONTARIO

CITATION: Chambers Estate v. Chambers, 2013
    ONCA 511

DATE: 20130812

DOCKET: C56024 & C56025

Gillese, Epstein and Lauwers JJ.A.

In the Estate of Herbert Washington Chambers,
    deceased

And in the Matter of an Application for a
    Certificate of Appointment of Estate Trustee with a Will

BETWEEN

Violet Agatha Chambers

Applicant (Respondent)

and

Michael Chambers
,
    Clive Oliver Chambers, Marva Chambers, Velma Timol, Mazie May Thomas, Collette
    Harrison, Jennifer Chang (also known as Jennifer Chong), Natasha Chambers,
    Christopher Chambers, Andrea Chambers, Adrian Chang, Shara Chang, Michael Nassies
    Chambers Jr., Rayon Recardo Chambers, Claire Eden Elizabeth Chambers, Lisa
    Chambers, Rochelle Antonette Fraser, Kimora Chomas (also known as Kimora Camela
    Thomas) and The Office of the Childrens Lawyer

Respondents (
Appellant
)

A. Sean Graham and Christopher M. B. Graham, for the
    appellant

Michael Kerr, for the respondent Violet Agatha Chambers

David Lobl, for the Bank of Nova Scotia Trust Company

Heard: April 26, 2013

On appeal from the judgments of Justice Anne Mullins of
    the Superior Court of Justice, dated August 21, 2012.

Gillese J.A.
:

[1]

These two appeals arise from applications brought in respect of Herbert
    Washington Chambers (Mr. Chambers) personal and corporate estates (the
    Estate).  To resolve the appeals, this court must distinguish among a number
    of related concepts respecting estate trustees
[1]
:
    renunciation, resignation, removal, and passing over.

[2]

Because the appeals arise from the same set of facts, this single set of
    reasons disposes of them both.

OVERVIEW

[3]

On April 8, 2008, Mr. Chambers executed two wills.  In the first will
    (the Primary Will), Mr. Chambers disposed of all of his assets, except shares
    in private corporations that he owned at the time of his death.  In the second
    will (the Corporate Will), he disposed of those shares (the Corporate
    Assets).

[4]

Michael Chambers (Michael Chambers or the appellant) is Mr.
    Chambers son.  He brought an application asking that he and a trust company be
    named as co-estate trustees of both wills.

[5]

Agatha Violet Chambers (Mrs. Chambers) is the deceaseds widow.  After
    her husbands death, she acted as the estate trustee under both wills.  She
    brought an application asking to be removed, or permitted to resign, as the estate
    trustee under both wills, and seeking to have a trust company named as sole
    succeeding estate trustee.

[6]

The two applications were heard together.  By two judgments dated August
    21, 2012 (the Judgments), the applications judge ordered:

-

Mrs.
    Chambers be removed as the estate trustee of both wills;

-

Michael
    Chambers be removed or passed over as estate trustee; and,

-

the
    Bank of Nova Scotia Trust Company (the Bank) be the sole succeeding estate trustee
    in Mrs. Chambers stead.

[7]

Michael Chambers appeals.

[8]

For the reasons that follow, I would dismiss the appeals.

the background facts

The Primary Will

[9]

In the Primary Will, Mr. Chambers appointed two trustees: Mrs. Chambers
    and his daughter, Collette Harrison.  He did not name any alternate trustees.

[10]

Under
    the Primary Will, Mrs. Chambers was to receive Mr. Chambers personal effects,
    and his interest in the furniture and furnishings in the matrimonial home.  Apart
    from that, the estate was bequeathed to his children, including Michael
    Chambers, grandchildren, relatives, and friends.

Pansy Miller

[11]

In
    the Primary Will, Mr. Chambers directed his trustees to give Pansy Miller the
    option to purchase his interest in 7 Elderwood Drive, Richmond Hill (the
    Elderwood property), within one year of his death, at fair market value less
    6 per cent,  the commission payable if sold on the open market.  The
    Elderwood property was registered in the joint names of Mr. Chambers and Ms. Miller. 
    In the Primary Will, Mr. Chambers also made a bequest of $75,000 to Ms. Miller.

[12]

Ms.
    Miller had been an employee of Fairview Nursing Home Limited (Fairview), a
    108-bed nursing home in Toronto that Mr. Chambers and Mrs. Chambers had founded.

[13]

She
    brought a wrongful dismissal lawsuit against Fairview.  Judgment in the matter
    was issued, on consent, on June 7, 2012, requiring Fairview to pay her
    $113,952.52.

The Corporate Will

[14]

In
    the Corporate Will, Mr. Chambers again named Mrs. Chambers and Collette
    Harrison as his estate trustees.  However, he provided that if Mrs. Chambers
    predeceased him or was, at any time, unable or unwilling to act or continue as estate
    trustee, Michael Chambers was to serve as estate trustee, together with
    Collette Harrison.

[15]

In
    the Corporate Will, Mr. Chambers directed his trustees to distribute the net
    proceeds of the Corporate Assets equally among his seven named children, one of
    whom is Michael Chambers.

[16]

Mr.
    Chambers shares in Fairview are the most significant of the Corporate Assets. 
    He owned 50 per cent of the shares in Fairview and served as an officer and
    director of the company.  Mrs. Chambers owns the other 50 per cent of
    Fairviews shares and continues to serve as an officer and director.


Administration of the Estate before the Applications

[17]

Mr.
    Chambers died on October 3, 2011.  His Estate is worth millions of dollars.  As
    will become evident over the course of these reasons, the Estate is complex and
    its administration is rife with problems.

[18]

On
    December 13, 2011, Collette Harrison renounced her right to serve as estate trustee
    under both of his wills.  She did not carry out any estate duties prior to renouncing,
    other than to attend at the bank with her mother in an attempt to learn about
    the bank accounts.

[19]

Mrs.
    Chambers, on the other hand, assumed her role as estate trustee upon her
    husbands death, and began performing under both wills.

The Renunciation Order

[20]

In
    March of 2012, Ms. Miller served Mrs. Chambers and Collette Harrison with
    motion material in which they were named as respondents.  Through the motion,
    Ms. Miller sought to require Mrs. Chambers and Collette Harrison to file an
    application for a certificate of appointment as estate trustee with a will and produce
    all of Mr. Chambers testamentary documents.  As well, she sought an order
    permitting her to sell the Elderwood property and retain 25 per cent of the
    sale proceeds.

[21]

On
    the advice of her then-solicitor, Mrs. Chambers did not respond to the motion. 
    He told her it was not necessary.

[22]

When
    Ms. Millers motion was heard, no one appeared for the respondents.

[23]

On
    April 4, 2012, the motion judge issued three orders.

[24]

In
    the first order of that date (the Renunciation Order), Mrs. Chambers and Collette
    Harrison were required to file an application for a certificate of appointment
    of estate trustee with a will within 30 days, failing which they shall be
    deemed to have renounced [their] right to be appointed.

[25]

In
    the second order, Mrs. Chambers and Collette Harrison were ordered to produce
    all of Mr. Chambers testamentary documents in their possession or under their
    control, within 30 days of the date of service of the order.

[26]

The
    third order gave Ms. Miller the unilateral right to sell the Elderwood property
    and retain one quarter of the sale proceeds.

After the Renunciation Order

[27]

Neither
    Mrs. Chalmers nor Collette Harrison filed an application for certificate of
    appointment as estate trustee, as required by the Renunciation Order.

[28]

Mrs.
    Chambers attempted to comply with the deadline established by the second order
    but could not locate the original wills until May 31, 2012.  On June 4, 2012,
    she presented the wills to the Registrar.

[29]

The
    third order led to the Elderwood property being sold for $1,540,000 on May 31,
    2012.

Michael Chambers

[30]

Michael
    Chambers  formerly Michael Christie  is Mr. Chambers son.  He is 56 years of
    age and now a Canadian citizen.  He is a discharged bankrupt.

[31]

Under
    an arrangement with his father, Michael Chambers lived rent free at a farm property
    located on the Guelph Line in Milton (the Guelph property).  Mr. Chambers and
    Mrs. Chambers jointly owned the Guelph property.  They purchased it in 2008 for
    $2,650,000.

[32]

Michael
    Chambers worked for his father from 2004 onwards.  He primarily worked at the
    Guelph property but, from time to time, he also did maintenance work for
    Fairview.

[33]

Mr.
    Chambers paid Michael Chambers $1,000 a month to look after the Guelph property. 
    While Mr. Chambers and Michael Chambers were managing the horse operation on
    the Guelph property, the employees made numerous successful complaints to the
    Ministry of Labour.

[34]

After
    his fathers death, Michael Chambers continued to live on the Guelph property. 
    Mrs. Chambers eventually advised him that the arrangement he had with his
    father was ended and that she intended to sell the Guelph property.  She told
    him that he had to vacate.

[35]

Michael
    Chambers did not accept that Mrs. Chambers had the right to require him to
    vacate the Guelph property.  He interfered with the real estate agents
    attempts to market the property to prospective purchasers.  After he left the property,
    Mrs. Chambers and the real estate agent discovered that the keypad for the
    security system had been torn out of the wall and the house was in a complete mess.

[36]

Michael
    Chambers accused Mrs. Chambers (and her daughter Lisa Chambers and her husband)
    of breaking into his residence on the Guelph property, and taking documents and
    $1,150 in cash.  He made the accusation repeatedly, including to the Ontario
    Provincial Police.  The authorities investigated and chose to not act on the
    accusation.

[37]

Further,
    Michael Chambers did not accept that Mrs. Chambers was the estate trustee.  His
    lawyer sent Mrs. Chambers lawyer a notice of objection to the issuance of a
    certificate of appointment of estate trustee to her, dated May 8, 2012.

Mrs. Chambers

[38]

At
    the time the applications were brought, Mrs. Chambers was 81 years of age,
    partially deaf and suffering from significant mobility problems.  She is not in
    the best of health.  She has been devastated by the death of her husband and from
    discovering some of his undisclosed personal life.  While she had attempted
    to administer the Estate, she deposed that the nature and extent of the issues
    arising on his death have overwhelmed [her]. She was unable and unwilling to
    continue to act as estate trustee.  Further, she had been advised by her
    solicitor that she had claims against the Estate and was, therefore, in a position
    of conflict of interest.

[39]

The
    conflict of interest arose, in part, from events relating to Fairview.

[40]

After
    Mrs. Chambers partially retired from Fairview in 1996, Mr. Chambers mismanaged
    it.  As a result, in 2008, the Ministry of Health put Fairview into
    enforcement.  In order to continue operating the business, Mr. Chambers was
    obliged to agree to retain professional managers.  The Ministry of Health took
    the position that Fairview owed it $800,000 and deducted $35,000 per month from
    its operating payments to Fairview.

[41]

While
    serving as estate trustee of her late husbands estate, Mrs. Chambers learned that
    he had diverted Fairview funds to his own benefit and to the benefit of others,
    without her knowledge and approval.  For example, for many years the dividends
    on the Fairview shares had been paid to Mr. Chambers and her on a 65/35 basis,
    instead of the 50/50 basis required because they each owned 50 per cent of the
    shares.  There were also tax arrears claimed in respect of Fairview and various
    lawsuits filed against it.

[42]

On
    August 7, 2012, the Toronto Dominion Bank made a demand on Fairview for the
    immediate payment of its loans of $1,160,914.88.  It asserted that Mr. Chambers
    had personally guaranteed the debt.  Mrs. Chambers advanced $115,000 of her own
    money to forestall a receivership.

[43]

Mrs.
    Chambers is also exposed to liabilities that her late husband incurred, for
    which she will seek indemnity from the Estate.

[44]

Mrs.
    Chambers has a poor relationship with Michael Chambers and wishes to have no
    contact with him.

Michael Chambers Application

[45]

In
    June 2012, Michael Chambers brought an application in which he sought an order
    appointing him and a trust company as co-estate trustees of both the Primary Will
    and the Corporate Will.  He swore an affidavit, dated June 19, 2012, in support
    of the application.

[46]

Certain
    factual aspects of Michael Chambers affidavit are worthy of note.  First, in
    it, he repeated his accusation that Mrs. Chambers broke into his home at the
    Guelph property, after which he discovered documents and cash were missing.  He
    said that [a]pparently [Mrs. Chambers] felt entitled to [break into his home]
    because she and [Mr. Chambers] were joint owners.  He acknowledged that the
    Guelph property passed to Mrs. Chambers by right of survivorship, but deposed
    that her conduct underscores that it may be to the Estates benefit that [Mrs.
    Chambers and Collette Harrison] renounced.  Second, he also accused Mrs.
    Chambers of having given away or sold horses that had been housed on the Guelph
    property, and of having kept the sale proceeds, despite the fact that the money
    belonged to the Estate, not her.


[47]

In
    his affidavit, Michael Chambers also set out his belief as to the legal foundation
    for his application.  He deposed that as a result of non-compliance with the
    Renunciation Order, both Mrs. Chambers and Collette Harrison had renounced
    their appointments as estate trustees, and he was therefore the estate trustee
    under the Corporate Will, having accepted his appointment under that will.

[48]

Michael
    Chambers further deposed that he believed it was in the Estates best interests
    that a trust company be appointed to act as his co-estate trustee.  In his
    view,

a co-estate trustee arrangement respects [Mr. Chambers]
    testamentary wish that I be estate trustee of his Corporate Will while ensuring
    the highest level of administrative expertise, especially when it comes to
    helping me fulfill my duties to administer [Mr. Chambers] shares.

[49]

Finally,
    on the basis that Mrs. Chambers and Collette Harrison had renounced under the
    Primary Will and no substitute trustee was in place, he deposed that it would
    be more efficient for him and the trust company to act as co-estate trustees in
    respect of the Primary Will, as well as the Corporate Will.

Mrs. Chambers Application

[50]

By
    the time that Michael Chambers served his application, Mrs. Chambers had
    decided to resign as estate trustee and seek to have an institutional trustee
    appointed in her stead.  She brought an application asking to be removed, or
    permitted to resign, as estate trustee.  Her affidavit filed in support was
    sworn on June 27, 2012.

[51]

Mrs.
    Chambers deposed that she supported the appointment of an institutional trustee
    because the Estate is large, complex and in some disarray, and the appointment
    of a professional trustee would be in the best interests of all beneficiaries.

[52]

Mrs.
    Chambers does not view Michael Chambers as suitable or qualified to assist in
    the administration of the Estate.

[53]

Two
    of the Chambers children opposed Michael Chambers appointment as the co-estate
    trustee.  All consented to the Banks appointment as succeeding estate
    trustee.

The decision below

[54]

The
    applications judge described the Estates assets and debts as follows.  The
    assets of the primary estate are approximately $3,000,000, against which there
    are debts for unknown income tax and known tax liabilities of approximately
    $420,000.  The assets in the corporate estate were estimated to be worth about $1,000,000
    and the debts at approximately $240,000.  In addition, Fairview might be worth
    as much as $5,000,000, against which there are registered mortgages of
    $3,200,000.

[55]

The
    applications judge noted that Mrs. Chambers might make claims against the
    Estate in relation to: real property held solely in Mr. Chambers name at 98
    Concorde Avenue, Toronto; income distributions made from Fairview: and, liabilities
    incurred by her late husband for which Mrs. Chambers stands exposed and for
    which she will seek indemnity from the Estate.

[56]

The
    applications judge identified concerns about the administration of the Estate,
    most notably the preservation of the Fairview asset, adding that: (1) to forestall
    a receivership, Mrs. Chambers advanced $115,000 of her own money; (2) the mortgagee
    had delivered a notice to enforce security; and (3) historically, Mr. Chambers
    management of Fairview was problematic.

[57]

The
    applications judge set out Michael Chambers position: Mrs. Chambers and
    Collette Harrison were deemed to have renounced, as a result of the
    Renunciation Order; he had accepted the appointment as estate trustee of the
    Corporate Will; and, as estate trustee, he could be removed only in exceptional
    circumstances, which did not exist.

[58]

The
    applications judge acknowledged that the appointment of an estate trustee under
    a will ought not to be lightly interfered with but noted that Michael Chambers was
    a named alternate trustee under only one of the two wills, that two of the
    beneficiaries did not consent to his appointment, and that all beneficiaries consented
    to the appointment of the Bank as succeeding estate trustee.

[59]

The
    applications judge also commented on the complexities of the Estate, adversity
    of interest between Mrs. Chambers and the Estate, and the need for Fairviews proper
    management and disposition so that the best value would be realised for the beneficiaries
    and the burden on Mrs. Chambers, as the owner of the other 50 per cent of
    Fairviews shares, would be eased.

[60]

The
    applications judge concluded that the welfare of the beneficiaries would be
    best served if a trust company acted as sole estate trustee given its expertise
    and credibility, and the economies associated with having a single estate trustee
    for both wills.

The issues

[61]

Michael
    Chambers submits that Mrs. Chambers application should have been dismissed. 
    He contends that she could not be removed because she had already been deemed
    to have renounced.  Furthermore, he says, there was no basis on which to remove
    him as the estate trustee of the Corporate Will or pass him over.  He does not
    appeal the appointment of the Bank as the sole estate trustee under the Primary
    Will.

[62]

Specifically,
    the appellant submits that the applications judge erred in failing to:

(1)

find that Mrs. Chambers had
    renounced;

(2)

interpret the wills in light of
    the purported renunciation;

(3)

apply the proper test for his removal;
    and

(4)

apply the proper test for his passing
    over.

renunciation

[63]

Michael
    Chambers application to be named the estate trustee (in conjunction with a
    corporate trustee) was based, in part, on his submission that the Renunciation
    Order deemed Mrs. Chambers to have renounced and that order had never been
    overturned or varied.  He complains that while the applications judge noted
    this submission, she did not address it.  He renews this submission on appeal,
    saying that Mrs. Chambers must be found to have renounced and suffer the
    statutory consequences of renunciation dictated by ss. 25 and 34 of the
Estates
    Act
, R.S.O. 1990, c. E.21.

[64]

I
    acknowledge that the applications judge did not expressly deal with this
    submission.  Nonetheless, I would not give effect to this ground of appeal.

[65]

Renunciation
    is defined as [t]he formal act whereby an executor entitled to a grant of
    probate (or person having the right to a grant of administration) renounces
    such right: James MacKenzie,
Halsburys Laws of Canada, Wills and Estates
,
1st ed. (Reissue) (Markham: LexisNexis Canada
    Inc., 2012), at p. 537; James MacKenzie,

Feeneys Canadian
    Law of Wills
, loose-leaf, 4th ed. (Markham: LexisNexis
    Canada Inc., 2000), at para. 7.26; and
MacDonald v. MacIsaac
(1983), 58 N.S.R. (2d) 199 (C.A.), at para. 22.

[66]

Renunciation is generally not available if a party has already intermeddled
    with the estate.  Intermeddling is the term used to describe the acts of a
    person who deals with an estate without having been formally recognized as the
    estate trustee.  As Kennedy J. explained, while executors may renounce at any
    time, (a right which is usually exercised before applying to probate) the
    courts have been reluctant to allow an executor to renounce after having intermeddled
    in the estate, or after having applied for probate:
Stordy v.
    McGregor
(1986), 42 Man. R. (2d) 237 (Q.B.), at para. 9.
    Even a slight act of intermeddling with a deceaseds assets may preclude an
    executor from afterwards renouncing: see
Cummins v. Cummins
(1845), 8 I. Eq. R. 723 (Ch.), at pp. 737-38.  However, this rule has
    been applied with some flexibility: see e.g.
Holder v. Holder
, [1968] Ch. 353 (C.A.).

[67]

In
Waters Law of Trusts in Canada
,
[2]
the authors explain:

Once a trustee has accepted the office, he cannot
    refuse, or to use the correct terminology, disclaim it.  He can then only
    resign, his acts between acceptance and resignation being those of a duly
    appointed trustee.  Disclaimer is available to all those who have been
    appointed trustees, whether as original trustees, new trustees, or additional
    trustees, but who have not expressly accepted and who have done no act which is
    deemed implied acceptance.

[68]

In
    respect of Collette Harrison, there is no question that she renounced.  She did
    so expressly on December 13, 2011, without having carried out any estate
    duties.  Her renunciation was effective when made.  The Renunciation Order, in
    deeming Collette Harrison to have renounced, changed nothing.

[69]

What
    then is Mrs. Chambers position as a result of the Renunciation Order?  At the
    time that the Renunciation Order was made, Mrs. Chambers was already administering
    the Estate under both wills.  It is self-evident that she could not renounce, given
    that renunciation can take place only prior to any act of administration having
    been performed.

[70]

However,
    for the purpose of deciding this issue and in light of the collateral attack
    doctrine, I will assume that the Renunciation Order had effect and Mrs.
    Chambers is deemed to have renounced.  On that assumption, what are the
    consequences?

[71]

In
    my view, pursuant to s. 25 of the
Estates Act
, Mrs. Chambers right to
    serve as the named estate trustee would have ceased, but because of her
    continued administration of the Estate, the role of estate trustee would nonetheless
    have devolved to her on the basis of intermeddling, or the trustee
de son
    tort
principle.

[72]

Section
    25 reads as follows:

25.  When an executor survives the testator, but dies
    without having taken probate, and
when an executor is summoned to take
    probate, and does not appear, the executors right in respect of the
    executorship wholly ceases
, and the representation to the testator, and
    the
administration of the testators property
, without any further
    renunciation,
goes, devolves, and is committed in like manner as if such
    person had not been appointed executor.
[Emphasis added.]

[73]

The
    Renunciation Order required Mrs. Chambers to make an application for a
    certificate of appointment with a will  in effect, she was summoned to take
    probate.  She did not appear, within the meaning of s. 25, in that she did not
    make the application.  Consequently, s. 25 provides, her right to serve as
    estate trustee ceased.

[74]

However,
    s. 25 goes on to provide, administration of the Estate goes, devolves and is
    committed as if Mrs. Chambers had not been appointed executor.  To whom does
    it devolve?  In my view, it would devolve on Mrs. Chambers.  Why?  Because Mrs.
    Chambers alone continued to administer the Estate, the intermeddling or trustee
de son tort
principle would apply, with the result that the office would
    devolve to her.  Consequently, and contrary to the appellants submission, she could
    be relieved of that role only through following the appropriate process for removal
    or resignation.

[75]

Under
    the trustee
de son tort
principle, a person who is not appointed a
    trustee, but who take[s] upon [himself or herself] to act as such and to
    possess and administer trust property may nonetheless be treated as one:
United
    Rubber Estates, Ltd. v. Cradock (No. 3)
, [1968] 2 All E.R. 1073 (Ch.), at
    p. 1095; see e.g.
Coleman v. Ryan
(1923), 55 O.L.R. 182 (H.C.);
Pickering
    v. Thompson
(1911), 24 O.L.R. 378 (Div. Ct.); and
Charles J. Ellison
    Ltd. v. Murray
, [1949] O.W.N. 398 (C.A.).

[76]

As
    Rutherford J. explained in
Re
OReilly (No. 2)
(1980), 28 O.R. (2d)
    481 (H.C.), at p. 486, affd 33 O.R. (2d) 352 (C.A.):

[i]t is
    trite law that a person not lawfully appointed an executor or administrator may
    by reason of his intrusion upon the affairs of the deceased be treated for some
    purposes as having assumed the executorship, as having constituted himself an
    executor
de son tort.

[77]

In
    this case, Mrs. Chambers continued administration of the Estate is 
indicative of an intention to usurp the functions or authority
    of a trustee, and the trustee
de son tort
principle applies:
Re OReilly (No. 2)
, at
    p. 486.  Consequently, as I have said, as a result of Mrs. Chambers
    intermeddling after the deemed renunciation, the administration of the Estate
    would have devolved to her pursuant to s. 25.

[78]

A
    consideration of s. 34 of the
Estates Act
leads to a similar analysis
    and conclusion.  Section 34 reads as follows:

34.
Where a person renounces probate
of the
    will of which the person is appointed an executor,
the persons rights in
    respect of the executorship wholly cease
, and the representation to the
    testator and
the administration of the testators property
, without
    any further renunciation,
goes, devolves and is committed in like manner as
    if such person had not been appointed executor.
[Emphasis added.]

[79]

On
    a plain reading of s. 34, assuming that the Renunciation Order is treated as
    having the effect of a renunciation of probate, Mrs. Chambers right to
    administer the Estate by virtue of being the named estate trustee ceased. 
    Administration of the Estate would devolve as if she had not been appointed
    executor.  However, after the Renunciation Order, Mrs. Chambers alone continued
    to carry out the duties of the estate trustee.  Therefore, under s. 34, in the
    circumstances of this case, administration of the Estate devolved to her,
    pursuant to the intermeddling or trustee
de son tort
principle.

[80]

This
    ends the analysis of renunciation in respect of the Primary Will.  An additional
    question remains in respect of the Corporate Will, however.  Does the fact that
    Michael Chambers was named as an alternate estate trustee in the Corporate Will
    affect the foregoing analysis?  In my view, it does not.

[81]

By
    the express terms of the Corporate Will, Michael Chambers is named as alternate
    estate trustee in the event that Mrs. Chambers is unable or unwilling to act or
    continue to act.  However, that condition precedent to Michael Chambers
    appointment was not met until Mrs. Chambers brought her application.  The
    deemed renunciation, assuming it could operate, did not render Mrs. Chambers
    unable to act  it simply caused her right to administer the Estate, based on
    having been the named estate trustee, to cease.  And, Mrs. Chambers only became
    unwilling to act at the time that she brought her application.

[82]

Thus,
    although Michael Chambers purported to accept an appointment as the estate
    trustee under the Corporate Will, prior to the hearing of the applications, he was
    not able to because the condition precedent to his appointment had not been met.

[83]

Moreover,
    and contrary to the appellants assertion, the applications judge committed no
    error in deciding Mrs. Chambers application.  It was necessary for Mrs.
    Chambers to bring such an application in order to be relieved of the role of
    estate trustee.

InterpretATION OF the will

[84]

Michael
    Chambers submits that ss. 25 and 34 of the
Estates Act

required
    the applications judge to interpret the wills as if neither Mrs. Chambers nor
    Collette Harrison had been named as the estate trustees.  Thus, he says, he is
    the only named trustee in the Corporate Will and there was no named trustee in
    the Primary Will at all.

[85]

I
    see nothing in this submission.  Neither ss. 25 nor 34 says anything about the
    interpretation of the will.  There is no basis for reading into the legislation
    the requirement that if a court finds that either provision applies, the will
    in question must be interpreted as if the named estate trustee had never been
    named.

[86]

This
    ground of appeal must fail.

REMOVal

[87]

Michael
    Chambers complains that the applications judge did not distinguish between
    removal and passing over, and that it is unclear on what basis she refused to
    appoint him as the estate trustee under the Corporate Will.  He submits that
    the most accurate characterization is that he was removed as the estate
    trustee.

[88]

I
    accept that the applications judge does not explain whether she removed Michael
    Chambers as the estate trustee or passed him over.  This is evident from para.
    5 of the Judgment rendered in Michael Chambers application, which reads as
    follows:

THIS COURT ORDERS
that the relief sought to have Michael
    Chambers removed or passed over however it might best be expressed, is
    hereby granted.

[89]

In
    my view, properly understood, the applications judge passed over Michael
    Chambers as estate trustee under the Corporate Will.

[90]

An
    estate trustee is removed after he or she has received a certificate of
    appointment, whereas an executor is passed over before the issuance of such a
    certificate: see
Windsor v. Mako Estate

(2008), 43 E.T.R. (3d)
    255 (Ont. S.C.), at para. 35.  Put another way, a person is removed as estate
    trustee after he or she has assumed authority to administer the estate, whereas
    a person is passed over as estate trustee prior to having assumed authority to
    administer the estate.

[91]

At
    the time the applications were heard, Michael Chambers was not the estate
    trustee and, therefore, could not have been removed.  He had not received a
    certificate of appointment nor had he been acting as estate trustee.  Although
    he purported to have accepted an appointment as the named alternate estate
    trustee under the Corporate Will on the basis that Mrs. Chambers was unable or
    unwilling to act, as I have explained, he could not accept such an appointment
    as, prior to the applications, Mrs. Chambers was neither unable nor unwilling
    to act as the estate trustee.

[92]

Accordingly,
    the question of Michael Chambers removal does not arise and this ground of
    appeal fails.

PASSING OVER

[93]

Michael
    Chambers submits that if the applications judge passed him over as the estate
    trustee under the Corporate Will, she did so in error and without considering
    or applying the proper legal test.

[94]

I
    do not accept this submission.

[95]

The
    applications judge was fully alive to the legal principle that the court should
    not lightly interfere with a testators choice of the person to act as his or
    her estate trustee:
Re Weil
, [1961] O.R. 888 (C.A.), at p. 889.  Just
    as a court should remove an estate trustee only on the clearest of evidence,
    so too they should be reluctant to pass over a named executor
unless
    there is no other course to follow:
Windsor
, at
    para. 41, citing
Crawford v. Jardine
(1997), 20
    E.T.R. (2d) 182 (Ont. C.J. (Gen. Div.)), at para. 18.  As Wright L.J.
    explained, passing over of an executor and granting administration to other
    parties is an unusual and extreme course, though it is within the discretion of
    the Probate Court:
Re Leguia (No. 2)
(1936), 155
    L.T.R. 270 (C.A.), at p. 276.

[96]

Thus, the wishes of the testator will generally be honoured, even if
    the person chosen is of bad character:
Carmichael Estate (Re)

(2000), 46 O.R. (3d) 630 (S.C.), at para. 17.  In fact, an
    executor named in a will should not be passed over simply because he or she is
    of bad character or bankrupt, or there is likely to be friction between
    co-executors: see
Harris v. Gallimore
(1925), 57
    O.L.R. 673 (C.A.), at p. 678;
Re Agnew
, [1941] 4
    D.L.R. 653 (Sask. C.A.), at p. 657;
Re Wolfe
(1957), 7 D.L.R. (2d) 215 (B.C.C.A.), at p. 221; and
Crompton v.
    Williams
, [1938] O.R. 543 (H.C.), at pp. 586-87.  That being
    said, courts have passed over an executor because he was in a conflict of
    interest with the estate (e.g.
Re Becker
(1986),
    57 O.R. (2d) 495 (Surr. Ct.), at pp. 498-99;
Thomasson Estate (Re)
, 2011 BCSC 481, [2011] B.C.W.L.D. 4763, at paras. 29-30) or because
    she had a conflict and was in poor health (e.g.
Re Bowerman
(1978), 20 O.R. (2d) 374 (Surr. Ct.), at p. 377).

[97]

In
    this case, Michael Chambers is correct when he says that the applications judge
    failed to implement the provisions of the Corporate Will appointing him as the
    alternate estate trustee.  And, I accept that Mr. Chambers knew that Michael
    Chambers was a discharged bankrupt at the time he made his wills.  Nonetheless,
    in my view, the applications judge made no error in passing Michael Chambers
    over as the estate trustee under the Corporate Will.

[98]

It
    is clear from the record that Michael Chambers holds a strong animosity towards
    Mrs. Chambers.  I need not repeat the facts around the allegations he has made
    in respect of Mrs. Chambers to justify this statement.  His animosity rises
    above mere friction and satisfies me that due administration of the corporate estate
    would be compromised were he to be appointed a co-estate trustee with the Bank
    as he wishes.

[99]

It
    is trite law that trustees must act jointly.  The central task of the estate
    trustee in respect of the Corporate Will is to ensure that Fairview is properly
    managed and sold.  Given that Mrs. Chambers owns 50 per cent of Fairviews
    shares and the Estate owns the other 50 per cent, there is every reason to
    believe that Michael Chambers strong animosity towards Mrs. Chambers would
    create a deadlock in relation to the management and sale of Fairview if he were
    appointed a co-estate trustee with the Bank.  His decisions in respect of
    Fairview could not fail to be coloured by his overriding animosity towards Mrs.
    Chambers.

[100]

Mrs. Chambers is
    a founder and one-half shareholder of Fairview.  She has injected personal
    funds to stave off receivership.  These are not irrelevant considerations, as
    the appellant would have it.  They are very much tied up with Fairviews proper
    management and disposition.  Decisions regarding the preservation and sale of
    Fairview must be made with care and dispatch.  The risk of deadlock between
    Michael Chambers and the Bank is real.  For this reason, and having regard to
    the beneficiaries best interests, the applications judge, in my view, made no
    error in passing over Michael Chambers.

CONCLUSION

[101]

Despite the
    Renunciation Order, because Mrs. Chambers continued to administer the Estate, she
    required a court order in order to be released from the position of estate
    trustee.  Sections 5 and 37 of the
Trustee Act
, R.S.O. 1990, c. T.23
    give the court the authority to remove a trustee and appoint another trustee in
    his or her place.
[3]
In addition, the court has an inherent power of appointment and removal: see
Evans
    v. Gonder
, 2010 ONCA 172, 259 O.A.C. 295, para. 42.  Therefore, when
    deciding Mrs. Chambers application, the applications judge had the power both
    to remove her as estate trustee and to appoint her successor.

[102]

I see nothing in
    Michael Chambers contention that Mrs. Chambers sought to resign conditionally
    on the appointment of her chosen successor, as in
Re Moorhouse
, [1946]
    4 D.L.R. 542 (Ont. H.C.J.), at p. 544.  Her wish to be removed was
    unconditional.  She did not attempt to dictate whom the court should appoint as
    her successor.  Rather, she offered her views on the needs of the Estate and
    the qualities her successor should possess.

[103]

It was clear
    from Mrs. Chambers application that she sought to have Michael Chambers passed
    over.  Thus, there is also nothing in the appellants submission that the
    applications judge gave relief that had not been sought and was not properly in
    issue.

[104]

As I have
    already noted, the applications judge was fully alive to the legal principle
    that a court ought not to lightly interfere with a testators choice of estate
    trustee.  However, she concluded that the welfare of the beneficiaries would be
    best served if a trust company were appointed the successor estate trustee
    because of its expertise and credibility, and the economies associated with a
    single trustee for both wills. She considered the complexity of the Estate
    administration, including the problems associated with Fairview, which all
    parties acknowledged.  She also considered Michael Chambers suitability before
    arriving at this conclusion.

[105]

Importantly,
    although the applications judge did not allude to this, as I have already
    explained, there is the very real possibility that the appellants appointment
    as co-estate trustee with the Bank would have led to a deadlock situation.  In
    order to avoid that, as well as for the reasons articulated by the applications
    judge, I see no error in her conclusion that the Bank alone should be appointed
    as the successor estate trustee.

disposition

[106]

Accordingly, I
    would dismiss the appeals with costs to the respondent payable from the Estate,
    fixed in the amount of $10,000, all inclusive.

Released:

AUG 12 2013                                   E.E.
    Gillese J.A.

EEG                                                I
    agree Gloria Epstein J.A.

I
    agree P. Lauwers J.A.


APPENDIX A

Trustee Act
, R.S.O. 1990, c. T.23

Power of court to appoint new trustees

5.       (1) The Superior Court of Justice may make an order for the
    appointment of a new trustee or new trustees, either in substitution for or in
    addition to any existing trustee or trustees, or although there is no existing
    trustee. R.S.O. 1990, c. T.23, s. 5 (1); 2000, c. 26, Sched. A, s. 15 (2).

Limitation of effect of order

(2) An order
    under this section and any consequential vesting order or conveyance does not
    operate as a discharge from liability for the acts or omissions of the former
    or continuing trustees. R.S.O. 1990, c. T.23, s. 5 (2).



Removal of personal
    representatives

37.     (1) The Superior Court of Justice may remove a personal
    representative upon any ground upon which the court may remove any other
    trustee, and may appoint some other proper person or persons to act in the
    place of the executor or administrator so removed. R.S.O. 1990, c. T.23, s. 37
    (1); 2000, c. 26, Sched. A, s. 15 (2).

Security by person appointed

(2) Every
    person so appointed shall, unless the court otherwise orders, give such
    security as would be required to be given if letters of administration were
    granted to the person under the Estates Act. R.S.O. 1990, c. T.23, s. 37 (2).

Who may apply

(3) The order
    may be made upon the application of any executor or administrator desiring to
    be relieved from the duties of the office, or of any executor or administrator
    complaining of the conduct of a co-executor or co-administrator, or of any
    person interested in the estate of the deceased. R.S.O. 1990, c. T.23, s. 37
    (3).

When new appointment
    unnecessary

(4) Where the
    executor or administrator removed is not a sole executor or administrator, the
    court need not, unless it sees fit, appoint any person to act in the place of
    the person removed, and if no such appointment is made the rights and estate of
    the executor or administrator removed passes to the remaining executor or
    administrator as if the person so removed had died. R.S.O. 1990, c. T.23, s. 37
    (4).

Chain of representation

(5) The
    executor of any person appointed an executor under this section shall not by
    virtue of such executorship be an executor of the estate of which his or her
    testator was appointed executor under this section, whether such person acted
    alone or was the last survivor of several executors. R.S.O. 1990, c. T.23, s.
    37 (5).

Copy of order to be filed

(6) A
    certified copy of the order of removal shall be filed with the Estate Registrar
    for Ontario and another copy with the local registrar of the Superior Court of
    Justice, and such officers shall, at or upon the entry of the grant in the
    registers of their respective offices, make in red ink a short note giving the
    date and effect of the order, and shall also make a reference thereto in the
    index of the register at the place where the grant is indexed. R.S.O. 1990, c.
    T.23, s. 37 (6); 2000, c. 26, Sched. A, s. 15 (2).

Endorsement

(7) The date
    of the grant shall be endorsed on the copy of the order filed with the Estate
    Registrar for Ontario. R.S.O. 1990, c. T.23, s. 37 (7).





[1]
Different terms are used to describe the person who administers an estate:
    executor, executrix, trustee, and estate trustee, to name but a few.  For ease
    of reference, the term estate trustee is used in these reasons.



[2]
Donovan W.M. Waters, Mark R. Gillen & Lionel D. Smith,
Waters Law of
    Trusts in Canada
,
4th ed. (Toronto: Thomson Reuters Canada Limited,
    2012), at p. 884.



[3]
The full text of ss. 5 and 37 is included in Appendix A to these reasons.


