Introduction: The real question in these fights

Beneficiaries often want distribution now. A prudent estate trustee sometimes wants to wait. Perhaps because the roof needs work before listing, because a spring market will outperform a bleak winter, or because COVID-era backlogs depressed showings. The legal question is whether the trustee’s decision to delay a sale is a breach, or a reasonable exercise of discretion that deserves defence and indemnity. The case law gives trustees real room to act prudently and, where the will confers discretion, to time the sale to protect and enhance value. The defence case turns on that prudence, the will’s wording, and the evidence showing the delay is value-driven rather than self-interested.

 Start with the trustee’s standard of care

 The Supreme Court’s touchstone in Fales v. Canada Permanent Trust Co., 1976 CanLII 14 (SCC), [1977] 2 SCR 302^[1] fixes the standard. Trustees must act with the vigilance, prudence, and sagacity of an ordinary prudent person administering their own affairs. That standard is about process and judgment, not hindsight. It allows latitude when timing a realization to preserve or maximize value, so long as the trustee has actually turned their mind to the decision and acted in good faith.

In Fales, the executors retained an income-producing mortgage investment that later went into default. The beneficiaries alleged negligence for failing to liquidate earlier. The Supreme Court disagreed, emphasizing that trustees are not insurers of success. They are judged by the prudence of their conduct at the time, not by the outcome. Justice Dickson, writing for the Court, held that the trustees’ decision to hold the investment, made after seeking professional advice and assessing prevailing market conditions, was within the range of reasonable judgment.

The case continues to stand for the principle that courts will not penalize trustees for exercising informed discretion, even if market movements later prove them wrong. What matters is that they acted prudently, sought advice where needed, and made the decision in good faith.

When the Will Gives Timing Discretion, It Usually Governs

Where the will grants a power to “sell at such time and in such manner as the trustee sees fit,” Ontario courts have been clear that the trustee’s discretion is not cut down by the three-year vesting rule in the Estates Administration Act^[2]. The Court of Appeal in Di Michele v. Di Michele, 2014 ONCA 261^[3] held that s. 9 does not override an express power to postpone. The testator’s intention is paramount.

In Di Michele, the deceased’s will gave her three sons, as trustees, broad authority to sell or postpone the sale of a family home. One son, also a beneficiary, remained living there for several years after her death. His brothers argued that the property had to be sold within three years under the Estates Administration Act, and sought an order forcing the sale. The Court of Appeal rejected that argument. Justice Gillese confirmed that when a will expressly authorizes postponement, that clause governs over the statutory default. Section 9 does not compel conversion on a fixed timeline. Rather, it yields to the testator’s express direction that trustees may delay if they believe it prudent. On that footing, a delay aligned with a will’s grant of discretion is not, without more, a breach. It is an exercise of judgment the law respects, provided the trustee acts in good faith and for the estate’s benefit.

The Point Confirmed in Kuzyk v. Romaniuk

The point has been applied at first instance. In Kuzyk v. Romaniuk, 2015 ONSC 5995^[4], the Ontario Superior Court confirmed that Di Michele means exactly what it says, namely that a broad “postpone or sell when advisable” clause is genuine authority. Section 9 of the Estates Administration Act does not force a sale on a fixed timeline when the will says otherwise. In Kuzyk, siblings quarrelled over their late mother’s home. The will appointed one of them as estate trustee and gave her discretion to “sell or postpone sale” of any property. The other beneficiaries demanded an immediate sale to obtain their share of the proceeds. The trustee delayed, reasoning that market conditions were unfavourable and that modest improvements could increase value.

Justice Glass upheld the trustee’s discretion. He held that s. 9 only applies in the absence of contrary intention and that the will’s postponement clause gave the trustee lawful authority to delay the sale. Because her decision was made in good faith and aimed at maximizing the estate’s value, it did not breach her duties. The case underscores that a properly drafted postponement clause protects a trustee from claims of unreasonable delay, provided the timing decision is prudent and supported by evidence.

What “Reasonable Delay” Looks Like in Practice

A recent, concrete illustration is Hume v. Windle and Laronde, 2024 ONSC 132^[5]. The deceased appointed two of her daughters as estate trustees. One of them, Laronde, moved into the deceased’s home in 2019 to help care for her mother as her health declined. After the mother’s death later that year, Laronde and her husband continued living in the home without paying rent until it was sold in December 2021. Another sibling, a residuary beneficiary, objected to the delay in selling and sought occupation rent from Laronde, alleging that the estate had been deprived of income while she remained in the property.

The will, however, expressly empowered the trustees to “postpone the conversion of assets to money for such length of time as the Trustee deems appropriate.” The Court found that the delay was neither unreasonable nor a breach of duty. The trustees had undertaken repairs and improvements to ready the property for sale, acted on professional advice, and made the decision against the backdrop of COVID-related market uncertainty. Justice Vermette held that the postponement clause gave the trustees legitimate authority to defer the sale, and that the delay was a product of good-faith administration rather than neglect or self-interest.

The Court also dismissed the beneficiary’s claim for occupation rent, finding insufficient evidence to support the alleged rental value and noting that he lacked standing to bring the claim on behalf of the estate. The case illustrates that when a will authorizes postponement and the trustee can demonstrate value-focused steps and genuine reasons tied to market conditions or practical realities, “delay” can be a sign of prudence rather than breach.

Beneficiaries Cannot Force a Sale by the Back Door

In the recent decision of Addante v. Ruscica, 2022 ONSC 2148^[6], a residuary beneficiary of an estate applied under the Partition Act, R.S.O. 1990, c. P.4^[7] seeking partition and sale of a property held in the estate. The property had been transferred by the deceased to two of the children as joint trustees, with the deceased retaining a life interest. After the deceased’s death the property remained unsold. The will gave the estate trustee broad discretion to deal with estate assets. The Court held the residuary beneficiary lacked standing under the Partition Act because she did not hold immediate possession of the specific asset and only had a contingent entitlement as a residuary beneficiary. The Court dismissed the application without prejudice to other estate-remedies (such as removal of the trustee under the Trustee Act, R.S.O. 1990, c. T.23^[8].

Similarly, in Rizzo v. Farruggia, 2024 ONSC 4615^[9], one of the residuary beneficiaries sought an order compelling the sale of the deceased’s home and claiming occupation rent against a sibling living therein. The Court held the beneficiary lacked standing for a Partition Act application because she held only a residuary interest, not immediate possession. The court also dismissed the occupation-rent claim for the same reason. The Court removed the sister as executor and trustee due to conflicts and deadlock in estate administration, rather than granting a sale under the Partition Act.

Together, these cases underscore that where a beneficiary holds only a residuary interest and not a defined asset or immediate possessory right, the proper forum is estate administration (removal, directions, accounting) not a Partition Act application to force sale of estate property.

Courts Won’t Micromanage Bona Fide Trustee Judgment

Eve v. Brook, 2016 ONSC 1496^[10]> is also instructive. The case involved a daughter (Roz Eve) attacking her aunt Lillian Wilhelm’s administration of her late father’s estate. The flashpoint was Lillian’s decision (acting under a will that gave broad powers “to sell or otherwise dispose of, at the time or times and in the manner” the trustees decided) to negotiate and sell the estate’s 50% shareholding in a family company to the deceased’s brother. Roz said the sale was unauthorized, improvident, and symptomatic of wider mismanagement.

After a lengthy trial combined with a contested passing of accounts, Justice Sweeny held the will authorized the sale, found the $265,000 price was within fair market value based on competing expert valuations and appraisals, and dismissed the action. Importantly for trustee discretion, the Court reaffirmed that while it retains inherent supervisory jurisdiction, it will not interfere with a trustee’s discretionary powers unless the trustee failed to turn their mind to the decision, acted unfairly, or acted in bad faith. On the evidence, Lillian sought and relied on professional advice, negotiated the transaction, and made reasoned choices in administering the estate, so the Court would not second-guess her business judgment.

The case is a useful anchor for timing and judgment calls even without a “postpone conversion” clause. If the will grants broad discretion and the trustee can show a good-faith, informed process, Courts defer.

When Conflict or Inaction, Not prudence, Drives Delay

All of this has limits. If delay stems from self-dealing, paralysis, or entrenched conflict, removal or directions are available. I wrote a Substack on the topic of executor removal last summer, “When the Shoe No Longer Fits: Removing an Executor in Ontario”^[11].

In a leading case Radford v. Wilkins, 2008 CanLII 45548 (ON SC)^[12], the Ontario Superior Court of Justice addressed an application to remove an estate trustee. In Radford, the Court emphasised that while it has inherent and statutory jurisdiction (under s. 37 of the Trustee Act) to pass over or remove a trustee, such intervention must be justified by clear necessity and the paramount concern of the welfare of the beneficiaries. The Court stressed that friction alone, even considerable tension between trustee and beneficiaries or co-trustees, does not automatically warrant removal. Rather, what is required is proof that the trustee’s continued role would likely prevent proper administration of the estate. Past misconduct or delay may be relevant, but removal is not a tool to punish mistakes. It is reserved for situations where the trustee’s conduct or the administrative deadlock threatens the estate’s interests. In that respect, the decision underscores the line between a defensible business-judgment call (such as timing an asset realisation) and a stall rooted in self-interest or conflict. With that principle in hand, a market-driven deferral by a trustee, if documented and value-based, remains protectable, whereas a delay born of paralysis, self-dealing, or unresolved conflict may tip the scales toward intervention under Radford.

Funding the Defence

Two related funding principles matter.

First, trustees generally enjoy indemnity from the estate for properly incurred administration expenses, which can include legal fees to defend their administration decisions or to pass accounts. Eve v. Brook characterized contested-passing legal fees as true administration expenses, with ultimate reasonableness assessed on the passing. This is helpful authority when beneficiaries balk at defence spending that is proportional to the issue.

Second, many modern estates carry executor liability insurance. The “duty to defend” under such policies turns on the policy wording, but the litigation reality often mirrors liability insurance practice. If pleadings allege a covered “wrongful act” in administration, the insurer typically steps in to defend, reserving rights as needed. While I have found little Ontario case law squarely on executor-policy defence duties, the indemnity principle and the estates costs jurisprudence together support the proposition that a trustee’s reasonable, value-protective timing judgment is a defensible administration act that should be funded either by the estate (subject to reasonableness on the passing) or, where available, by the policy’s defence coverage pending coverage resolution.

How to Build the Record That Wins

The strongest defence is built before tempers flare. Trustees should document the rationale for deferral, including listing histories for comparable properties, agent advice on seasonality, repair estimates and before-and-after valuations, and a timetable that shows active steps rather than drift. Circulate regular updates to beneficiaries and invite input on listing strategy.

If a family blow-up is imminent, an advice-and-directions application, framed around the will’s discretion clause and market evidence, can front-load judicial oversight and cool partition-style skirmishes. Where a postpone clause exists, tie the proposed timetable to that power and to the Di Michele line. Where it doesn’t, tie it to Fales prudence and Eve’s non-intervention principle, both anchored in good-faith, value-protective administration.

Where Recent Decisions Leave Us

The trajectory of recent Ontario authorities points in one direction, namely reasoned postponement to enhance value is permissible, and where the will expressly empowers timing discretion, the beneficiaries’ impatience does not convert prudence into breach. Hume shows courts weighing real-world market conditions and preparation work. Addante and Di Michele reinforce that residuary beneficiaries cannot conscript the Partition Act to override the trustee’s authority. Eve and Fales keep the focus on good-faith, prudent judgment. And Radford reserves removal for administration that endangers the estate, not for timing decisions supported by evidence.

That is a defence an executor can stand on, and, as a matter of estates practice, one the estate (and, where applicable, the executor’s insurer) should fund while the Court tests reasonableness on a proper record.