Can an Executor Resign Partway Through Administering an Estate?

You agreed to act as executor, and you have already started. Then it became too much: the paperwork, the family tension, the time it takes or a change in your own health or job. You may be wondering whether you can simply step away.

Once you have begun acting, stepping away is generally not a matter of sending a letter. This article explains the court route that is available, what usually comes up about accounts and pay, and how a replacement is put in place. The right path depends on your facts, so a lawyer can confirm it.

Resigning once you have started

An executor or administrator who wants to be relieved of the role can bring an application to the court. The application can also be brought by any person interested in the estate. This is the same application route used when someone asks the court to remove a trustee.

The Superior Court of Justice may remove a personal representative, which is the legal term that includes an estate trustee, and appoint a replacement. For you, the practical point is that the estate has to keep running. Beneficiaries and creditors should not be left without someone responsible for it.

If you have not yet taken any steps, such as applying for the certificate, your options may be different. What applies depends on what you have already done, so a lawyer can confirm the right approach for your circumstances.

Accounts and what you have to show

An executor or administrator need not account to the court, other than by inventory, unless a person interested in the property or a creditor requires it. A full account is only needed when it is lawfully required. Whether accounts will be demanded on your exit depends on the estate and the beneficiaries.

If accounts are passed, the process in the Toronto region starts with a Notice of Application to Pass Accounts (Form 74.44), which is served under Rule 74.18(3). If there is no objection, or all objections are withdrawn, the application can proceed unopposed in writing before a judge in chambers.

On a passing, the judge may inquire fully into the estate's property and how it was administered and disbursed. The judge may also look into complaints of misconduct or neglect that caused loss and order payment to the estate. Keeping clear records from day one is the best protection you have.

Compensation if you leave early

A Superior Court judge may fix an estate trustee's compensation on a passing of accounts. A trustee, guardian or personal representative is entitled to a fair and reasonable allowance for care, pains and trouble and time spent on the estate, as a judge allows.

Be careful about paying yourself in advance. The Court of Appeal says a trustee may take compensation before the accounts are passed only if all competent persons with a vested or contingent interest agree, the court approves, or the will allows it. Otherwise the trustee risks being held liable for breach of trust.

On a passing, the court can approve a lower amount than the trustee took and order the trustee to repay the difference to the estate. If you have already paid yourself anything, tell your lawyer before you apply.

If beneficiaries object

A beneficiary with a vested or contingent interest can file a notice of objection to the accounts or to the compensation claimed. If the objection is not withdrawn, the passing becomes a contested hearing.

Mandatory mediation under Rule 75.1 applies to contested passings of accounts. The Toronto practice direction asks parties in a contested passing to be ready to address mediation directions on the first return date.

Who takes over

When a trustee is removed, the court can appoint a replacement. Unless the court orders otherwise, a person appointed to replace a removed estate trustee must give the security that would be required of an administrator. If other estate trustees remain, the court need not appoint a replacement.

If you are one of several executors, the others may be able to carry on. That is a point worth raising early with a lawyer, since it may shorten the process.

What to do next

• Hold off on taking any compensation until you have spoken with a lawyer, since compensation taken early can create risk.
• List what you have done so far, including accounts opened, payments made and notices sent.
• Collect bank statements, receipts and records so that accounts can be prepared if required.
• Tell the other executors and the main beneficiaries that you are considering stepping back.
• Think about whether hiring help would let you stay in the role instead of leaving it.
• Speak with a lawyer about whether a court application is the right route in your situation.

Frequently asked questions