Collapsing Trusts in BC
Termination of Trust by Beneficiaries
Collapsing Trusts by Applying to the Court
Estate Planning fundamentally involves an attempt to control the dispersal of assets after a person dies. One area of concern is when a will-maker dies and leaves a large estate to a young adult who may not be capable of managing such a significant windfall.
A method of preventing the young beneficiary from mis-managing their finances is to set up a testamentary trust whereby their funds are held in trust by a trustee with release upon them reaching a certain age. While this area of Trust law can be quite complex and a number of factors are determinative with respect to the adequacy and effectiveness of the trust, there is a common law remedy developed in an old case entitled Saunders v. Vautier, which enables an adult (over the age of 19) beneficiary who is not under a disability to apply to the Court to collapse the trust.
In the seminal book on Trust Law, by Donovan Waters, The Law of Trusts In Canada, Mr. Waters explains the rule in Saunders as follows:
If there is only one beneficiary, or if there are several (whether entitled concurrently or successively), and they are all of one mind, and he or they are not under any disability, the specific performance of the trust may be arrested, and the trust modified or extinguished by him or them without reference to the wishes of the settlor or the trustees.
Related BC Wills, Estate Planning, & Litigation Posts
- Resolving Resulting Trusts: Estate Litigation and Wills Variation in BC
- Summary Trials in BC Wills Variation Cases
- Why File A Certificate of Pending Litigation
- B.C. Estate Litigation: Hearing “Hearsay” Evidence
Contact our Wills Variation & Litigation Lawyers in Vancouver BC
The Kushner Law Group in Vancouver B.C. has extensive experience representing clients in wills variation and civil litigation cases. If you are the sole beneficiary of a trust and have concerns about its administration or would like to see the Trust collapsed, it is critical to obtain legal advice. Contact the Kushner Law Group at 604-629-0432 to schedule a consultation.