A family member or friend has died and you are named as the
executor and trustee under their will. You are flattered and
honored, but you've never acted in this capacity before and
you're unsure of what exactly it means. One key thing you
should be aware of is that, if you take the role, the law considers
you to be a fiduciary –meaning your conduct will be
held to high standards developed by the courts over many
The fiduciary has scope for the exercise of some discretion or
The fiduciary can unilaterally exercise that power or discretion
so as to affect the beneficiary's legal or practical
The beneficiary is peculiarly vulnerable to or at the mercy of
the fiduciary holding the discretion or power.
Commonly recognized categories of fiduciary relationships
include trustee/beneficiary, director/ corporation, lawyer/client,
doctor/patient, and partners within a business partnership.
As an executor and trustee, your fiduciary obligations include
Take due care. In dealing with the estate, you
must exercise an appropriate level of care, skill and diligence.
You have to care for the trust property in the manner that a
reasonably prudent person would care for the property of others for
whom they felt a moral obligation to provide.
Act in good faith. Your decisions must be based
on proper considerations, and the interests of the beneficiaries.
You can't use your position to benefit yourself. You must
scrupulously avoid entering into deals or arrangements that benefit
you in some way or that would otherwise cause your personal
interests to conflict with your position as trustee.
Remain impartial. You can't favour one
beneficiary or group of beneficiaries over another, regardless of
your personal feelings and alliances. If the interests of two
groups of beneficiaries are in conflict – for example the
deceased's spouse is to receive trust income for life and his
children receive the capital on her death – you must take
particular care to balance their interests in an even-handed
A breach of a fiduciary obligation can have serious legal,
financial and reputational implications. If you are finding it
difficult to carry out these duties, or are not sure how they apply
to you, ask for help.
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.
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On March 31, 2014, BC's new Wills, Estates and Succession Act1 ("WESA") will come into force. WESA introduces new protections for beneficiaries of estates that are in danger of being disputed or deemed ineffective by a court.
It is not uncommon for parents to provide monetary gifts to their adult children. Parents may wish to help their child with a down payment on a property, or help pay out their child's existing mortgage.
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