In the recent case in Ontario of Craven v Osidacz, 2017 ONSC 1757 an executor was found to be personally liable for legal fees of both the estate and a claimant against the estate in excess of $200,000.
The unique and tragic circumstances of the case were this: In 2006, Andrew Osidacz murdered his son and attempted to murder his ex-wife and in doing so was shot and killed by police. That Mr. Osidacz committed these crimes was undisputed. His ex-wife, Ms. Craven, brought an action against his estate for damages in the amount of $622,159.41 for the wrongful death of their son, for two assaults committed against her and her attempted murder, for aggravated and punitive damages, and for spousal support arrears. Ms. Craven was successful in her claims but faced years of extensive litigation against the executor of the estate, Michael Osidacz, who fought her claims “tooth and nail.” As a result of the litigation, the estate was depleted significantly because of legal fees and Ms. Craven brought an action seeking that the executor Mr. Osidacz be held personally liable to repay the estate for the legal costs he incurred, as well as her legal costs in pursuing her claims.
Ultimately, Justice Lofchik of the Ontario Superior Court of Justice ordered Mr. Osidacz to repay the estate over $70,000 in legal fees he had incurred on the basis that he had advanced “speculative and groundless defences,” had acted in an unreasonable manner and was totally irrational and reckless in his conduct amounting to a dissipation of the estate’s assets. He was then further ordered to pay costs to Ms. Craven for the legal fees she incurred on a solicitor client basis given his “reprehensible conduct” in carrying out a personal vendetta against her.
Although this case is clearly an extreme, it serves as a caution to executors to ensure that they act reasonably and prudently in carrying out their duties in administering an estate. One way an executor may ensure they are not held personally liable is to apply to the Court for advice. In Alberta, an executor, or “personal representative” as they are known under the legislation, may apply to the Court for advice or direction with regard to any question respecting the management or administration of the estate and in acting on the Court’s advice cannot be found to be personally responsible for their conduct unless they have committed fraud or concealed or misrepresented information to the Court.