Commencing Actions on Behalf of an Estate – Part 2
In part 1 of this blog, we began to review the decision of Terezakis v. Ekins, 2018 BCSC 24 where the Court was asked to consider an application being brought under s. 151 of the Wills Estates and Succession Act (“WESA”) by the son of the Deceased to bring an action on behalf of the Estate against his sister, the named executrix. Estate litigation lawyers have found s. 151 of WESA to be a useful tool in prosecuting claims on behalf of estates to protect the interests of beneficiaries.
With respect to the application by the son of the Deceased, after reviewing the provisions of s, 151, Madame Justice Morellato made the following comments:
[31] Ms. Ekins is in a difficult position. She is the executor of the Estate, a beneficiary under the Will and also the owner in fee simple of the Richmond Property which Mr. T. Terezakis claims she holds in trust for the Estate, an allegation which Ms. Ekins vigorously disputes. Ms. Ekins deposed in her affidavit sworn January 31, 2017 that, “in her capacity as Executor” of the Estate, she intend to take a neutral position” in the Action. By taking a “neutral position”, Ms. Ekins is clearly unwilling to prosecute the claims articulated by Mr. T. Terezakis, on behalf of the Estate, since a key issue in this suit would challenge her ownership interest in the Richmond Property. Further, because of her asserted interest in the Richmond Property, she is in a conflict of interest, making her effectively “unable to proceed” on behalf of the estate. In this light, given that I have found the other pre-conditions of s. 151 have been satisfied, I conclude that I may exercise my discretion to grant leave under s. 151 on the criterion of “necessity” alone.
[32] I have also considered Madam Justice Gray’s reasons in Bunn regarding whether the claims advanced by Mr. T. Terezakis disclose an arguable case, whether the potential relief sought is sufficient to justify the inconvenience to the estate of being involved in the action, and whether the proceeding would, overall, be in the best interest of the estate. While counsel for Ms. Ekins advanced a number of arguments that address and challenge the merits of the Action or Amended Action, the entirety of the evidence and legal arguments are not presently before me. I am very conscious that this application is not the proper forum to adjudicate the Action or Amended Action or to determine its strength in a manner that would necessarily bind a future court, particularly in light of the limited evidence before me and the degree to which this case may turn on issues of credibility and more fulsome discovery. Accordingly, I am not prepared to dismiss this application on the basis that there is no arguable case of a resulting trust. I am mindful that, by operation of law, the presumption of resulting trusts remains the general rule for gratuitous transfers and the onus is on the transferee to demonstrate that a gift was intended: see Pecore v. Pecore, 2007 SCC 17 (CanLII). The presumption of a resulting trust is undoubtedly rebuttable and this may very well be the result at the end of the day, such that Mr. T. Terezakis will not be able to successfully advance the Amended Action; however, I do not have sufficient evidence before me, for purposes of this application, to conclude that no arguable case exists.
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