In the recent case of Kulyk v. Kulyk, 2024 ONSC 4213, Roman Kulyk, the Executor and Trustee of his late father Nicholas Kulyk's estate, sought judicial intervention to sell two properties that had been owned by the deceased.
Background
Nicholas Kulyk passed away on October 17, 2013, leaving behind a will dated July 5, 2011. He was survived by his two adult sons, Roman and Andrew Kulyk. Under the will, Roman was appointed as the Executor and Trustee, with the estate to be divided equally between him and a trust for Andrew and his children, currently age 21 and age 18.
At the time of Nicholas's death, the estate included two properties, both located in Toronto.
Despite having no legal right to reside in either property, Andrew and his children continued to live in one property, with Andrew also using the garage at the other property. Roman also believed that Andrew is renting out the upper floors of one of the properties and collecting rental income, which he has no right to do.
Legal Issues
Roman allowed Andrew and his children to continue living at the Estate property while Andrew's children were minors. However, with both children now of age, Roman was seeking to sell the properties to settle the estate.
Roman commenced an application with Andrew and his two children named as respondents. The respondents ignored the proceedings despite being served, prompting Roman to seek several court orders to facilitate the sale.
Roman's application sought the following reliefs:
- A vesting order and an order granting possession of the properties
- Authority to sell the properties without requiring consents from the beneficiaries
- Orders for the respondents to vacate the properties and provide rent accounts
- Leave to issue writs of possession
Court's Decision
The court ruled in favor of Roman, recognizing his legal authority as the estate trustee to manage and sell the properties. The court found no need for a vesting order or possession order, as the will already empowered Roman to sell the estate assets.
The Court cited Oosterhoff on Wills for the applicable principle:
The question is often asked: Is it necessary to obtain probate [certificate of appointment of estate trustee] in every case? The answer is, no. This is because executors derive their authority from the will rather than from the probate process. As a result, executors have the lawful authority to deal with estate property even if they do not obtain probate. Likewise, courts have jurisdiction over wills (and the executors appointed thereunder) regardless of whether they are submitted for probate. ... The primary function served by probate [certificate of appointment of estate trustee] is therefore not to vest named executors with authority to deal with estate property but to authenticate to third parties that the persons presenting themselves as the executors are indeed the persons (more specifically, the only persons) with that authority.
Albert R. Oosterhoff et al. Oosterhoff on Wills, 9th ed (Toronto: Thomson Reuters Canada Limited, 2021) at page 33.However, to expedite the estate settlement, the court ordered the respondents and any unauthorized occupants to vacate the properties by September 30, 2024.
The judgment that was granted included the following:
- Respondents must vacate both Estate properties by September 30, 2024.
- Any unauthorized occupants must also vacate both Estate properties by the same date.
- Respondents must provide copies of any and all lease entered into pertaining to either Estate property and must account for any and all rents received.
- Any and all lease holding residents of the properties must pay rent to Roman, rather than to the respondents.
Additionally, the court awarded Roman $20,000 in costs, to be deducted from the respondents' share of the estate.
Conclusion
This case underscores the importance of adhering to the terms of a will and the legal authority of estate trustees. Executors derive their authority from the will itself, not the probate process, and this is what allows them to effectively manage the estate assets. The Court's decision reaffirms the executor's authority to manage and sell estate properties according to the deceased's will. By ordering the respondents to vacate and cooperate, the court ensures that the estate can be settled efficiently, reflecting the will's intent and the legal responsibilities of the trustee.
Thanks for reading and have a great day!
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.