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Revised Statutes of Newfoundland 1990


CHAPTER T-10

AN ACT RESPECTING TRUSTEES

Analysis

1. Short title

2. Definitions

3. Authorized investments

4. Redeemable investments

5. Discretion of trustee

6. Application to trusts

7. Purchase, etc. of land

8. Bearer certificates

9. Report of surveyor

10. Liability for excess

11. Appointment of trustees

12. Discharge by deed

13. Vesting

14. Sale by trustee

15. Sale not impeachable

16. Purchase by trustee

17. Appointment of agent

18. Power to insure property

19. Renewal of leases

20. Receipt sufficient discharge

21. Action of executor, etc.

22. Action by or against estate

23. Executor, etc. not liable

24. Notice to creditors

25. Petition to court

26. Trust for infant

27. Action by survivors

28. Power of attorney

29. Trustee liability limited

30. Actions against trustee

31. Unauthorized investment

32. Personal liability of trustee

33. New trustees

34. Vesting orders

35. Release of land

36. Infant's right to release

37. Mortgaged land

38. Judgment for sale or mortgage

39. Declaration by court

40. Effect of vesting order

41. Appointment of conveyor

42. Vesting order re: stock, etc.

43. Application

44. Court appointed trustee

45. Payment of costs

46. Vesting of land

47. Order conclusive

48. Payment into court

49. Court may hear action

50. Indemnification of trustee

51. Joint trustees

52. Remuneration of trustees

53. Compensation in will, etc.

54. Indemnity


Short title

1. This Act may be cited as the Trustee Act.

RSN1970 c380 s1

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Definitions

2. In this Act

(a) "contingent right", as applied to land, includes a contingent or executory interest, a possibility coupled with an interest, whether the object of the gift or limitation of the interest, or possibility is or is not ascertained, also a right of entry, whether immediate or future, and whether vested or contingent;

(b) "convey" and "conveyance" applied to a person include the execution by that person of a necessary or suitable assurance for conveying, assigning, appointing, or otherwise transferring or disposing of land of which he or she has possession, or in which he or she is entitled to a contingent right, either for his or her whole estate or for a less estate, together with the performance of formalities required by law for the validity of the conveyance;

(c) "court" means the Trial Division;

(d) "instrument" includes an Act of the Legislature;

(e) "land" includes an interest in land, and also an undivided share of land;

(f) "mortgage" and "mortgagee" include and relate to an estate and interest regarded in equity as merely a security for money, and a person deriving title under the original mortgagee;

(g) "pay" and "payment", as applied in relation to stocks and securities, and in connection with the expression "into court", include the deposit or transfer of the payment in or into court;

(h) "possessed" applies to receipt of income of and to a vested estate less than a life estate, legal or equitable, in possession or in expectancy in land;

(i) "property" includes real and personal chattels and an estate and interest in property, and a debt, and a thing in action, and other rights or interests, whether in possession or not;

(j) "rights" includes estates and interests;

(k) "stock" includes fully paid up shares and, so far as relates to vesting orders made by the court under this Act, includes a fund, annuity or security transferable in books kept by a company or society, or by instrument of transfer either alone or accompanied by other formalities, and a share or interest in stock;

(l) "transfer", in relation to stock, includes the performance and execution of a deed, power of attorney, act and thing on the part of the transferor to effect and complete the title in the transferee;

(m) "trust" does not include the duties incident to an estate by way of mortgage, but includes implied and constructive trusts and cases where the trustee has a beneficial interest in the trust property, and the duties incident to the office of personal representative of a deceased person; and

(n) "trustee" includes executor or administrator and a trustee whose trust arises by construction or implication of law, as well as an express trustee.

RSN1970 c380 s2; 1974 No57 s38(264(kk));
1986 c42 Sch A

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Authorized investments

3. Unless otherwise directed by the terms of the trust, a trustee having funds in his or her hands which it is his or her duty or which it is in his or her discretion to invest at interest may, whether at the time the funds are in a state of investment or not, invest them in

(a) the legislative stocks, public funds or government securities of the province, or in securities the interest of which is guaranteed by the Legislature;

(b) the parliamentary stocks, public funds or government securities of the United Kingdom, or securities the interest of which is guaranteed by the Parliament of the United Kingdom;

(c) the parliamentary stocks, public funds or government securities of Canada, or securities the interest of which is guaranteed by the Parliament of Canada;

(d) the legislative stocks, public funds or government securities of a province of Canada, or securities the interest of which is guaranteed by the Legislature of a province of Canada;

(e) sinking-fund or serial bonds or debentures issued or to be issued by the City of St. John's, the City of Mount Pearl or the City of Corner Brook;

(f) investment certificates of a trust company approved by order of the Lieutenant-Governor in Council;

(g) term deposit receipts or certificates of a bank to which the Bank Act (Canada) applies;

(h) bonds, debentures, debenture stock or other securities of a loan company approved by order of the Lieutenant-Governor in Council;

(i) bonds, debentures or other securities of a public utility which is approved by order of the Lieutenant-Governor in Council for the purpose;

(j) 1st mortgages of land within the municipal limits of the City of St. John's, the City of Corner Brook or the City of Mount Pearl;

(k) bonds, debentures or other securities issued or guaranteed by the International Bank for Reconstruction and Development established by the Agreement for an International Bank for Reconstruction and Development approved by the Bretton Woods Agreements Act (Canada), where the bonds, debentures or other securities are payable in the currency of Canada or the United States of America;

(l) bonds, debentures or other securities issued or guaranteed by the Inter-American Development Bank or by the Asian Development Bank, where the bonds, debentures or other securities are payable in the currency of Canada or the United States of America; and

(m) share deposits, savings and chequing deposits, deposit receipts or certificates, bonds, debentures or other securities of a credit union incorporated under the Co-operative Societies Act and approved for the purpose of that Act by order of the Lieutenant-Governor in Council.

RSN1970 c380 s3; 1973 No71 s2; 1982 c9 s15;
1988 c8 s1; 1989 c12 s30

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Redeemable investments

4. (1) A trustee may, under the powers conferred by this Act, invest in the securities referred to in paragraphs 3(a), (b), (c), (d), (e), (f), (h), (k) and (l), notwithstanding that the securities may be redeemable and that the price exceeds the redemption value.

(2) A trustee may retain until redemption redeemable stock a fund or security which may have been purchased in accordance with the powers of this Act.

RSN1970 c380 s4; 1973 No71 s3

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Discretion of trustee

5. A power conferred by section 4 shall be exercised according to the discretion of the trustee, but subject to a consent required by the instrument creating the trust with respect to the investment of the trust funds.

RSN1970 c380 s5

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Application to trusts

6. The powers conferred by sections 3, 4 and 5 shall be in addition to the powers conferred by the instrument creating the trust.

RSN1970 c380 s6

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Purchase, etc. of land

7. (1) A trustee having power to invest upon the security of land, unless expressly forbidden by the instrument creating the trust, may invest and shall be considered to have always had power to invest in the purchase of or on mortgage of a freehold or leasehold property.

(2) A trustee having power to invest in the mortgages or bonds of a railway company or of another description of company may, unless the contrary is expressed in the instrument authorizing the investment, invest in the debenture stock of a railway company or other company.

(3) Trustees lending money on the security of property on which they can lawfully lend may contract that that money shall not be called in during a period not exceeding 7 years from the time when the loan was made, provided interest be paid within a specified time not exceeding 30 days after a half-yearly or other day on which it becomes due, and provided there is no breach of a covenant by the mortgagor contained in the instrument of mortgage or charge for the maintenance and protection of the property.

RSN1970 c380 s7

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Bearer certificates

8. (1) A trustee may, unless expressly prohibited by the instrument creating the trust, retain or invest in securities payable to bearer which, where not so payable, would have been authorized investments.

(2) Securities to bearer retained or taken as an investment by a trustee not being a trust corporation or the Registrar of the Supreme Court shall, until sold, be deposited by him or her for safe custody and collection of income with a banker or banking company.

(3) A direction that investments shall be retained or made in the name of a trustee shall not, for the purposes of subsections (1) and (2), be considered to be an express prohibition.

(4) A trustee shall not be responsible for loss incurred because of a deposit referred to in subsection (2), and a sum payable in respect of that deposit and collection shall be paid out of the income of the trust property.

(5) The Lieutenant-Governor in Council has power upon the application of a trustee to convert debentures issued under the authority of an Act of the Legislature payable to bearer into debentures payable to the registered holder and to order that a register be opened by the Minister of Finance for the registration and transfer of those debentures.

RSN1970 c380 s8

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Report of surveyor

9. (1) A trustee lending money on the security of property on which he or she can lawfully lend shall not be chargeable with breach of trust by reason only of the proportion borne by the amount of the loan to the value of the property at the time when the loan was made, provided that

(a) it appears to the court that in making the loan the trustee was acting upon a report as to the value of property made by a person whom he or she reasonably believed to be an able practical surveyor or valuer instructed and employed independently of an owner of the property, whether that surveyor or valuer carried on business in the locality where the property is situated or elsewhere;

(b) the amount of the loan does not exceed 2/3 of the value of the property as stated in the report; and

(c) the loan was made under the advice of the surveyor or valuer expressed in the report.

(2) Notwithstanding subsection (1), a trustee lending money on a mortgage security, where the loan is an insured loan under the National Housing Act (Canada), is not chargeable with breach of trust by reason only that the amount of the loan exceeds 2/3 of the value of the property mortgaged.

(3) A trustee lending money on the security of a leasehold property shall not be chargeable with breach of trust only upon the ground that in making the loan he or she dispensed either wholly or partly with the production or investigation of the lessor's title.

(4) A trustee shall not be chargeable with breach of trust only upon the ground that in effecting the purchase of, or in lending money upon the security of, property, he or she has accepted a shorter title than the title which a purchaser is, in the absence of a special contract, entitled to require, where in the opinion of the court the title accepted is one that a person acting with prudence and caution would have accepted.

(5) This section applies to transfers of existing securities as well as to new securities.

RSN1970 c380 s9

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Liability for excess

10. Where a trustee improperly advances trust money on a mortgage security which would at the time of the investment be a proper investment for a smaller sum than is actually advanced on the security, the security shall be considered an authorized investment for the smaller sum, and the trustee shall only be liable to make good the sum advanced in excess of it with interest.

RSN1970 c380 s10

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Appointment of trustees

11. (1) Where a trustee, either original or substituted, and whether appointed by a court or otherwise, is dead, or remains out of this province for more than 12 months, or wishes to be discharged from a trust or power reposed in or conferred on him or her, or refuses or is unfit to act as trustee, or is incapable of acting as a trustee, then the person nominated for the purpose of appointing new trustees by the instrument creating the trust, or where there is no person, or no person able and willing to act, then the surviving or continuing trustee or the personal representative of the last surviving or continuing trustee may, by writing, appoint another person to be a trustee in the place of the trustee dead, remaining out of this province, wishing to be discharged, refusing or being unfit, or being incapable.

(2) On the appointment of a new trustee for the whole or a part of trust property

(a) the number of trustees may be increased;

(b) a separate set of trustees may be appointed for a part of the trust property held on trusts distinct from those relating to another part of the trust property, notwithstanding that no new trustee is to be appointed for other parts of the trust property, and an existing trustee may be appointed or remain 1 of that separate set of trustees, or, where only 1 trustee was originally appointed, then 1 separate trustee may be so appointed for the first mentioned part;

(c) it shall not be obligatory to appoint more than 1 new trustee where only 1 trustee was originally appointed, or to fill up the original number of trustees where more than 2 trustees were originally appointed, but, except where only 1 trustee was originally appointed, a trustee shall not be discharged under this section from his or her trust unless there will be at least 2 trustees to perform the trust; and

(d) an assurance or thing necessary for vesting the trust property, or a part of it, jointly in the persons who are the trustees shall be executed or done.

(3) A new trustee so appointed, as well before as after all the trust property becomes by law, or by assurance or otherwise, vested in him or her, shall have the same powers, authorities and discretions, and may act as if he or she had been originally appointed a trustee by the instrument creating the trust.

(4) The provisions of this section relative to a trustee who is dead include the case of a person nominated trustee in a will but dying before the testator, and those relative to a continuing trustee include a refusing or retiring trustee, where willing to act in the execution of this section.

(5) This section applies only where a contrary intention is not expressed in the instrument creating the trust, and shall have effect subject to the terms of that instrument and to a provision contained in it.

RSN1970 c380 s11

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Discharge by deed

12. (1) Where there are more than 2 trustees, if 1 of them by deed declares that he or she wishes to be discharged from the trust, and if his or her co-trustees or another person who is empowered to appoint trustees, by deed consent to the discharge of the trustee, and to the vesting in the co-trustees alone of the trust property, then the trustee who wishes to be discharged shall be considered to have retired from the trust, and shall by the deed be discharged from it under this Act without a new trustee being appointed in his or her place.

(2) An assurance or thing necessary for vesting the trust property in the continuing trustees alone shall be executed or done.

(3) This section applies only where a contrary intention is not expressed in the instrument creating the trust, and shall have effect subject to the terms of that instrument and to a provision contained in it.

RSN1970 c380 s12

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Vesting

13. (1) Where a deed by which a new trustee is appointed to perform a trust contains a declaration by the appointor to the effect that an estate or interest in land subject to the trust or in a personal chattel so subject, or the right to recover and receive a debt or other thing in action so subject, shall vest in the persons who, under the deed, become and are the trustees for performing the trust, that declaration shall, without a conveyance or assignment, operate to vest in those persons as joint tenants and for the purposes of the trust, that estate, interest or right.

(2) Where a deed by which a retiring trustee is discharged under this Act contains a declaration referred to in subsection (1) by the retiring and continuing trustees, and by the other person empowered to appoint trustees, that declaration shall, without a conveyance or assignment, operate to vest in the continuing trustees alone, as joint tenants, and for the purposes of the trust, the estate, interest or right to which the declaration relates.

(3) This section does not extend to land conveyed by way of mortgage for securing money subject to the trust, or to a share, stock, annuity, or property that is only transferable in books kept by a company or other body, or in manner directed by, or under an Act of the Parliament of the United Kingdom, or the Parliament of Canada, or of the Legislature of this province.

(4) For purposes of registration of a deed referred to in this section the person making the declaration shall be considered the conveying party, and the conveyance shall be considered to be made by him or her under a power conferred by this Act.

RSN1970 c380 s13

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Sale by trustee

14. (1) Where a trust for sale or a power of sale of property is vested in a trustee, the trustee may sell, or concur with another person in selling, all or a part of the property, either subject to prior charges or not, and either together or in lots, by public auction or by private contract, subject to those conditions respecting title, or evidence of title, or other matter that the trustee thinks appropriate, with power to vary a contract for sale, and to buy in at an auction, or to rescind a contract for sale and to resell, without being answerable for a loss.

(2) This section applies only where a contrary intention is not expressed in the instrument creating the trust or power, and shall have effect subject to the terms of that instrument and to the provisions contained in it.

RSN1970 c380 s14

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Sale not impeachable

15. (1) A sale made by a trustee shall not be impeached by a beneficiary upon the ground that a condition subject to which the sale was made may have been unnecessarily depreciatory, unless it also appears that the consideration for the sale was made inadequate.

(2) A sale made by a trustee shall not, after the execution of the conveyance, be impeached as against the purchaser upon the ground that a condition subject to which the sale was made may have been unnecessarily depreciatory, unless it appears that the purchaser was acting in collusion with the trustee at the time when the contract for sale was made.

(3) A purchaser, upon a sale made by a trustee, shall not be at liberty to make an objection against the title upon the ground mentioned in subsection (1) or (2).

RSN1970 c380 s15

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Purchase by trustee

16. Trustees may, by leave of the court, purchase the estate and effects of the testator or intestate, or the trust property, or a part of it, subject to those directions that the court may make in relation to the sale, and matters incident to it, and subject to confirmation by the court.

RSN1970 c380 s16

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Appointment of agent

17. (1) A trustee may appoint a solicitor to be his or her agent to receive and give a discharge for money or other valuable consideration or property receivable by the trustee under the trust by permitting the solicitor to have the custody of, and to produce, a deed executed by the trustee containing in the body of the deed a receipt for the money or valuable consideration or property.

(2) A trustee shall not be chargeable with breach of trust by reason only of his or her having made or concurred in making an appointment referred to in subsection (1).

(3) A trustee may appoint a banker or solicitor to be his or her agent to receive and give a discharge for money payable to the trustee under a policy of assurance by permitting the banker or solicitor to have the custody of and to produce the policy of assurance with a receipt signed by the trustee.

(4) A trustee shall not be chargeable with a breach of trust by reason only of his or her having made or concurred in making an appointment referred to in subsection (3).

(5) Nothing in this section shall exempt a trustee from liability which he or she would have incurred if this Act had not been passed, in case he or she permits money, valuable consideration or property to remain in the hands or under the control of the banker or solicitor for a period longer than is reasonably necessary to enable the banker or solicitor to pay or transfer the money, valuable consideration or property to the trustee.

(6) Nothing in this section authorizes a trustee to do anything which he or she is in express terms forbidden to do, or to omit anything which he or she is in express terms directed to do, by the instrument creating the trust.

RSN1970 c380 s18

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Power to insure property

18. (1) A trustee may insure against loss or damage by fire a building or other insurable property to an amount including the amount of an insurance already on foot not exceeding 75% of the full value of that building or property, and pay the premiums for that insurance out of the income of the building or property or out of the income of another property subject to the same trusts, without obtaining the consent of a person who may be entitled wholly or partly to that income.

(2) This section does not apply to a building or property which a trustee is bound immediately to convey absolutely to a beneficiary upon being requested to do so.

(3) Nothing in this section authorizes a trustee to do anything which he or she is in express terms forbidden to do, or to omit to do anything which he or she is in express terms directed to do by the instrument creating the trust.

RSN1970 c380 s19

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Renewal of leases

19. (1) A trustee for a leasehold for life or years which is renewable, either under a covenant or contract or by custom or usual practice, may, where he or she thinks appropriate, and shall, where required to by a person having a beneficial interest, present or future or contingent, in the leasehold, use his or her best endeavours to obtain a renewed lease of the same lands on the accustomed and reasonable terms, and for that purpose may make, or concur in making, a surrender of the lease existing, and to do those other acts that are necessary.

(2) Where by the terms of the settlement or will the person in possession for his or her life or other limited interest is entitled to enjoy the possession without an obligation to renew, or to contribute to the expense of renewal, this section shall not apply unless the written consent of that person is obtained to the renewal on the part of the trustee.

(3) Where money is required to pay for the renewal, the trustee effecting the renewal may pay the money out of money then in his or her hands in trust for the persons beneficially interested in the lands to be comprised in the renewed lease, and, where he or she has not in his or her hands sufficient money for the purpose, he or she may raise the money required by mortgage of the lands to be comprised in the renewed lease, or of other lands subject to the uses or trusts to which those lands are subject, and a person advancing money upon a mortgage purporting to be under his or her power shall not be bound to see that the money is wanted or that no more is raised than is wanted for the purpose.

(4) Nothing in this section authorizes a trustee to do anything which he or she is in express terms forbidden to do, or to omit to do anything which he or she is in express terms directed to do by the instrument creating the trust.

RSN1970 c380 s20

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Receipt sufficient discharge

20. The written receipt of a trustee for money, securities, or other property or effects payable, transferable or deliverable to the trustee under a trust or power shall be a sufficient discharge for it, and shall effectually exonerate the person paying, transferring or delivering it from seeing to the application or being answerable for a loss or misapplication of it.

RSN1970 c380 s21

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Action of executor, etc.

21. (1) An executor or administrator may pay or allow a debt or claim on whatever evidence that he or she thinks sufficient.

(2) An executor or administrator, or 2 or 3 trustees acting together, or a sole acting trustee, by which the instrument creating the trust a sole trustee is authorized to execute the trust and power of the trust, may, where and as he or she thinks appropriate, accept a composition or a security for a debt or for property claimed, and may allow time for payment of a debt, and may compromise, compound, abandon, submit to arbitration, or otherwise settle a debt, account, claim, or thing relating to the testator's or intestate's estate or to the trust, and for 1 of those purposes may enter into, give, execute and do those agreements, instruments of composition or arrangement, releases and other things, as to him or her seem expedient, without being responsible for a loss occasioned by an act or thing so done by him or her or them in good faith.

(3) This section applies only where a contrary intention is not expressed in the instrument creating the trust, and shall have effect subject to the terms of that instrument and to the provisions contained in it.

RSN1970 c380 s22

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Action by or against estate

22. (1) An action may be maintained by the executors or administrators of a person deceased for an injury to the estate of that person committed in his or her lifetime for which an action might have been maintained by that person, so long as injury was committed within 6 months before the death of that deceased person, and provided the action is brought within 1 year after the death of that person, and damages, where recovered, shall be part of the estate of that person.

(2) An action may be maintained against the executors or administrators of a person deceased for a wrong committed by him or her in his or her lifetime to another in respect to his or her property where that injury was committed within 6 months before that person's death, and so long as the action is brought within 6 months after those executors or administrators have taken upon themselves the administration of the estate and effects of that person.

(3) The damages to be recovered in an action under subsection (1) or (2) shall be payable in the same order of administration as the simple contract debts of those persons.

(4) The executors or administrators of a lessor or landlord may distrain upon the lands demised, for a term or at will, for the arrears of rent due to that lessor or landlord in his or her lifetime, in the same manner as that lessor or landlord might have done in his or her lifetime.

(5) The arrears referred to in subsection (4) may be distrained for after the end or determination of the term or lease at will, in the same manner as if the term or lease had not been ended or determined.

(6) Distress may be made within the space of 6 months after the determination of the term or lease, and during the continuance of the possession of the tenant from whom the arrears become due.

(7) The law relating to distress for rent shall be applicable to distresses made under this Act.

RSN1970 c380 s23

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Executor, etc. not liable

23. (1) Where an executor or administrator, liable as such to the rents, covenants or agreements contained in a lease, or an agreement for a lease, granted or assigned to the testator or intestate, whose estate is being administered,

(a) has satisfied those liabilities under the lease, or agreement for a lease, that have accrued due and been claimed up to the time of the assignment referred to in this section;

(b) has set apart a sufficient fund to answer a future claim that may be made in respect of a fixed and ascertained sum covenanted or agreed by the lessee to be laid out on the property demised, or agreed to be demised, although the period for laying out the sum has not arrived; and

(c) has assigned the lease, or agreement for a lease, to a purchaser,

he or she is at liberty to distribute the residue of the estate of the deceased to and among the parties entitled to it respectively, without appropriating a part, or a further part, of the estate of the deceased to meet a future liability under the lease, or agreement for a lease.

(2) An executor and administrator distributing the residuary estate shall not, after having assigned the lease, or agreement for a lease, and having where necessary set apart a sufficient fund, be personally liable in respect of a subsequent claim under the lease, or agreement for a lease.

(3) Nothing in this section prejudices the right of the lessor or those claiming under the lessor to follow the assets of the deceased into the hands of the persons to or among whom those assets may have been distributed.

RSN1970 c380 s24

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Notice to creditors

24. (1) Where an executor or administrator has given notice that in the opinion of the court is sufficient for creditors and others to send in to the executors or administrators their claims against the estate of the testator or intestate, that executor or administrator may, at the expiry of the time named in the notice for sending in those claims, distribute the assets of the testator or intestate, or a part of the assets, among the parties entitled to them, having regard to the claims of which that executor or administrator has notice.

(2) An executor or administrator shall not be liable for the assets, or a part of them, so distributed to a person of whose claim that executor or administrator has not had notice at the time of the distribution of the assets, or part of them.

(3) Nothing contained in this Act shall prejudice the right of a creditor or claimant to follow the assets, or a part of them, into the hands of the person who may have received them.

RSN1970 c380 s25

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Petition to court

25. (1) A trustee, an executor or administrator may, without the institution of an action, apply to the court or a judge of the court on a question respecting the management or administration of the trust, property or assets of a testator or intestate.

(2) A notice of an application shall be served on persons interested in the application, or on whom the court or judge directs.

(3) The trustee, executor or administrator acting upon the opinion, advice or direction given by the court or judge shall be considered, so far as regards his or her own responsibility, to have discharged his or her duty as the trustee, executor or administrator in the subject matter of the application.

(4) This section does not indemnify a trustee, executor or administrator in respect of an act done in accordance with an opinion, advice or direction obtained under this section, where that trustee, executor or administrator is guilty of a fraud, or wilful concealment, or misrepresentation in obtaining the opinion, advice or direction.

RSN1970 c380 s26

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Trust for infant

26. (1) In cases where property is held by a trustee in trust for an infant, either absolutely or contingently upon his or her reaching the age of 19 years, or on the occurrence of an event previously to his or her reaching that age, the trustee may, at his or her sole discretion, pay to the guardian of the infant, or otherwise apply for or towards the maintenance or education of the infant, the whole or a part of the income to which the infant may be entitled in respect of property, whether or not there is another fund applicable to the same purpose, or another person bound by law to provide for that maintenance or education.

(2) A trustee referred to in subsection (1) shall accumulate the residue of the income, by way of compound interest, by investing it and the resulting income of it in proper securities for the benefit of the person who shall ultimately become entitled to the property from which those accumulations shall have arisen.

(3) Notwithstanding subsections (1) and (2), a trustee may apply the whole or a part of the accumulations referred to in subsection (2) where they were part of the income arising in the then current year.

RSN1970 c380 s27; 1971 No14 s2; 1971 No71 s47

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Action by survivors

27. Where a power or trust is given to or vested in 2 or more trustees jointly, then, unless the contrary is expressed in the instrument creating the power or trust, the power may be exercised or performed by the survivor of them.

RSN1970 c380 s28

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Power of attorney

28. (1) A trustee acting or paying money in good faith under a power of attorney shall not be liable for that act or payment because of the fact that at the time of the payment or act the person who gave the power of attorney was dead or had done some act to avoid the power, where this fact was not known to the trustee at the time of his or her so acting or paying.

(2) Nothing in this section affects the right of a person entitled to the money against the person to whom the payment is made, and the person so entitled has the same remedy against the person to whom the payment is made as he or she would have had against the trustee.

RSN1970 c380 s29

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Trustee liability limited

29. (1) A trustee is, without prejudice to the instrument creating the trust, chargeable only for money and securities actually received by him or her, notwithstanding his or her signing a receipt for the sake of conformity, and is answerable and accountable only for his or her own acts, receipts, neglects or defaults, and not for those of another trustee, nor for a banker, broker, or other person with whom trust money or securities may be deposited, nor for the insufficiency or deficiency of securities, nor for another loss, unless that loss happens through the trustees own wilful default.

(2) A trustee may reimburse himself or herself or pay or discharge out of the trust premises expenses incurred in or about the execution of his or her trusts or powers.

RSN1970 c380 s30

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Actions against trustee

30. (1) In an action or other proceeding against a trustee or a person claiming through a trustee, except where the claim is founded upon a fraud or fraudulent breach of trust to which the trustee was party or privy, or is to recover trust property, or the proceeds of trust property still retained by the trustee, or previously retained by the trustee and converted to his or her use, the following provisions shall apply:

(a) rights and privileges conferred by a statute of limitations shall be enjoyed in the same manner, and to the same extent, as they would have been enjoyed in that action or other proceeding if the trustee, or person claiming through the trustee, had not been a trustee or person claiming through the trustee;

(b) where the action or other proceeding is brought to recover money or other property, and is one to which no existing statute of limitations applies, the trustee or person claiming through the trustee shall be entitled to the benefit of and may plead the lapse of time as a bar to that action or other proceeding, in the same manner and to the same extent as if the claim had been against that person in an action of debt for money received, but shall not begin to run against a beneficiary unless and until the interest of that beneficiary is an interest in possession.

(2) A beneficiary, as against whom there would be a good defence under this section, shall not derive a greater or other benefit from a judgment or order obtained by another beneficiary than he or she could have obtained if he or she had brought that action or other proceeding and this section had been pleaded.

(3) This section does not deprive an executor or administrator of a right of defence to which he or she is entitled under an existing statute of limitations.

RSN1970 c380 s31; 1983 c23 s19

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Unauthorized investment

31. A trustee shall not be liable for breach of trust by reason only of the trustee's continuing to hold an investment which has stopped being an investment authorized by the instrument of trust or by the general law.

RSN1970 c380 s32

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Personal liability of trustee

32. Where it appears to the court that a trustee, whether appointed by this Act or not, is or may be personally liable for a breach of trust, but has acted honestly and reasonably and ought fairly to be excused for the breach of trust, and for omitting to obtain the directions of the court in the matter in which he or she committed that breach, then the court may relieve the trustee either wholly or partly from personal liability for it.

RSN1970 c380 s33

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New trustees

33. (1) The court may, where it is expedient to appoint a new trustee and it is found inexpedient, difficult or impracticable to do so without the help of the court, make an order for the appointment of a new trustee either in substitution for or in addition to an existing trustee or although there is no existing trustee.

(2) The court may make an order for the appointment of a new trustee in substitution for a trustee who is convicted of a felony or declared insolvent.

(3) An order under this section and a consequential vesting order or conveyance shall not operate further or otherwise as a discharge to former or continuing trustees than an appointment of new trustees under a power for that purpose contained in an instrument, would have operated.

(4) Nothing in this section shall give power to appoint an executor or administrator.

RSN1970 c380 s34

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Vesting orders

34. (1) Where

(a) the court appoints or has appointed a new trustee;

(b) a trustee, entitled to or possessed of land or entitled to a contingent right in land, either solely or jointly with another person,

(i) is an infant,

(ii) is out of the jurisdiction of the court, or

(iii) cannot be found;

(c) it is uncertain who was the survivor of 2 or more trustees jointly entitled to or possessed of land;

(d) as to the last trustee known to have been entitled to or possessed of land, it is uncertain whether he or she is living or dead;

(e) there is no personal representative to a trustee who was entitled to or possessed of land and has died intestate as to that land, or it is uncertain who is the personal representative of a trustee who was entitled to or possessed of land and is dead; or

(f) a trustee jointly or solely entitled to or possessed of land, or entitled to a contingent right in land, has been required, by or on behalf of a person entitled to require a conveyance of the land or a release of the right to convey the land or to release the right, and has wilfully refused or neglected to convey the land or release the right within 28 days after the date of the requirement,

the court may make an order, in this Act called a vesting order, vesting the land in a person in a manner and for an estate that the court may direct, or releasing or disposing of the contingent right to the person that the court may direct.

(2) Where an order made under subsection (1) is consequential on the appointment of a new trustee the land shall be vested for the estate that the court may direct in the persons who, on the appointment, are the trustees.

(3) Where an order made under subsection (1) relates to a trustee entitled jointly with another person and that trustee is out of the jurisdiction of the court or cannot be found, the land or right shall be vested in that other person, either alone or with some other person.

RSN1970 c380 s35

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Release of land

35. Where land is subject to a contingent right in an unborn person who, on coming into existence, would become entitled to or possessed of the land on a trust, the court may make an order releasing the land from the contingent right, or may make an order vesting in a person the estate to or of which the unborn person would on coming into existence be entitled or possessed in the land.

RSN1970 c380 s36

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Infant's right to release

36. Where a person entitled to or possessed of land, or entitled to a contingent right in land, by way of security for money, is an infant, the court may make an order vesting or releasing or disposing of the land or right in the same manner as in the case of an infant trustee.

RSN1970 c380 s37

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Mortgaged land

37. Where a mortgagee of land has died without having entered into the possession or into the receipt of the rents and profits of the land, and the money due in respect of the mortgage has been paid to a person entitled to receive it, or that last mentioned person consents to an order for the reconveyance of the land, then the court may make an order vesting the land in the person in the manner that the court may direct in the following cases,

(a) where the personal representative of the mortgagee is out of the jurisdiction of the court, or cannot be found;

(b) where the personal representative of the mortgagee, on demand made by or on behalf of a person entitled to require a conveyance of the land, has stated in writing that he or she will not convey or does not convey it within 28 days after a proper deed for conveying the land has been tendered to him or her by or on behalf of the person so entitled;

(c) where it is uncertain whether the personal representative of the mortgagee is living or dead; and

(d) where there is no personal representative to a deceased mortgagee, or it is uncertain who is his or her personal representative.

RSN1970 c380 s38

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Judgment for sale or mortgage

38. Where the court gives a judgment or makes an order directing the sale or mortgage of land, a person who is entitled to or possessed of the land, or entitled to a contingent right in the land, and is a party to the action or proceeding in which the judgment or order is given or made, or is otherwise bound by the judgment or order, shall be considered to be so entitled or possessed as a trustee within the meaning of this Act, and the court may, where it thinks it expedient, make an order vesting the land or a part of it in the purchaser or mortgagee or in another person.

RSN1970 c380 s39

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Declaration by court

39. Where a judgment is given for the specific performance of a contract concerning land, or for the partition, or sale instead of partition, or exchange, of land, or generally where a judgment is given for the conveyance of land, the court may declare that a party to the action is a trustee of the land or a part of the land within the meaning of this Act, or may declare that the interests of unborn persons who might claim under a party to the action, or under the will or voluntary settlement of a person deceased, who was during his or her lifetime a party to the contract or transaction concerning which the judgment is given, are the interests of persons who on coming into existence would be trustees within the meaning of this Act and then the court may make a vesting order relating to the rights of those persons, born and unborn, as if they had been trustees.

RSN1970 c380 s40

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Effect of vesting order

40. A vesting order under this Act has, in the case of a vesting order consequential on the appointment of a new trustee, the same effect as if the persons who before the appointment were the trustees had executed proper conveyances of the land for the estate as the court directs, or where there is no person of full capacity, then as if that person had existed and been of full capacity, and had executed proper conveyances of the land for the estate that the court directs, and shall in other cases have the same effect as if the trustee or other person to whose right or supposed rights those provisions respectively relate had been an ascertained and existing person of full capacity and had executed a conveyance or release to the effect intended by the order.

RSN1970 c380 s41

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Appointment of conveyor

41. In cases where a vesting order can be made under this Act, the court may, where it is more convenient, appoint a person to convey the land or release the contingent right, and a conveyance or release by that person in conformity with the order shall have the same effect as an order under the appropriate provision.

RSN1970 c380 s42

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Vesting order re: stock, etc.

42. (1) Where

(a) the court appoints or has appointed a new trustee; and

(b) a trustee entitled alone or jointly with another person to stock or to a thing in action

(i) is an infant,

(ii) is out of the jurisdiction of the court,

(iii) cannot be found,

(iv) neglects or refuses to transfer stock or receive the dividends or income of stock, or to sue for or recover a thing in action, according to the direction of the person absolutely entitled to it for 28 days after a written request has been made to him or her by the person so entitled,

(v) neglects or refuses to transfer stock or receive the dividends or income of it, or to sue for or recover a thing in action for 28 days after an order of the court for that purpose has been served on him or her; or

(c) it is uncertain whether a trustee entitled alone or jointly with another person to stock or to a thing in action is alive or dead,

the court may make an order vesting the right to transfer or call for a transfer of stock, or to receive the dividends or income of the stock, or to sue for or recover a thing in action, in a person whom the court may appoint.

(2) Notwithstanding subsection (1),

(a) where the order is consequential on the appointment by the court of a new trustee, the right shall be vested in the persons who, on the appointment, are the trustees; and

(b) where the person whose right is dealt with by the order was entitled jointly with another person, the right shall be vested in that last mentioned person either alone or jointly with another person whom the court may appoint.

(3) In cases where a vesting order can be made under this section the court may, where it is more convenient, appoint a person to make or join in making the transfer.

(4) The person, in whom the right to transfer or call for the transfer of stock is vested by an order of the court under this Act, may transfer the stock to himself or herself or another person, according to the order, and companies shall obey orders under this section according to its tenor.

(5) After written notice of an order under this section it shall not be lawful for a company to transfer stock to which the order relates or to pay dividends on the stock except in accordance with the order.

(6) The court may make declarations and give directions concerning the manner in which the right to stock or a thing in action vested under this Act is to be exercised.

(7) The provisions of this Act as to vesting orders shall apply to shares in ships registered under the Acts relating to merchant shipping as if they were stock.

RSN1970 c380 s43

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Application

43. (1) An order under this Act for the appointment of a new trustee, or concerning land, stock, or a thing in action may be made on the application of a person beneficially interested, whether under disability or not, or on the application of a person appointed trustee of it.

(2) An order under this Act concerning land, stock or a thing in action, subject to a mortgage, may be made on the application of a person beneficially interested in the equity of redemption, whether under disability or not, or of a person interested in the money secured by the mortgage.

RSN1970 c380 s44

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Court appointed trustee

44. A trustee appointed by the court shall, as well before as after the trust property becomes by law or by assurance, or otherwise, vested in the trustee, have the same powers, authorities and discretions and may act as if he or she had been originally appointed a trustee by the instrument creating the trust.

RSN1970 c380 s45

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Payment of costs

45. The court may order the costs and expenses of and incident to an application for an order appointing a new trustee, or for a vesting order, or of and incident to that order, or a conveyance or transfer under that order, or generally of proceedings under this Act, to be raised or paid out of the estate, or out of the income of the estate, or to be borne and paid in the manner and by those persons that to the court seems just.

RSN1970 c380 s46

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Vesting of land

46. The powers conferred by this Act as to vesting orders may be exercised for vesting land, stock or a thing in action in a trustee of a charity or society over which the court would have jurisdiction upon action instituted, whether the appointment of the trustee was made by instrument under a power or by the court under its general or statutory jurisdiction.

RSN1970 c380 s47

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Order conclusive

47. (1) Where a vesting order is made as to land under this Act or under an Act relating to mental incapacity, founded on an allegation of the personal incapacity of a trustee or mortgagee, or on an allegation that a trustee or the personal representative of a mortgagee is out of the jurisdiction of the court or cannot be found, or that it is uncertain which of several trustees of a mortgagee was the survivor, or whether the last trustee or personal representative of a mortgagee is living or dead, or on an allegation that a trustee or mortgagee has died and it is not known who is his or her personal representative, the fact that the order has been so made shall be conclusive evidence of the matter so alleged in a court upon a question as to the validity of the order.

(2) This section does not prevent the court from directing a reconveyance or the payment of costs occasioned by an order made under subsection (1) where improperly obtained.

RSN1970 c380 s48

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Payment into court

48. (1) Trustees, or the majority of trustees, having in their hands or under their control money or securities belonging to a trust may pay the money or securities into the court and the money or securities shall, subject to rules of court, be dealt with according to the orders of the court.

(2) The receipt or certificate of the Registrar of the Supreme Court shall be a sufficient discharge to trustees for the money or securities so paid into court.

(3) Where money or securities are vested in more than 1 person as trustees and the majority wish to pay the money or securities into court but the concurrence of the others cannot be obtained, the court may order the payment into court to be made by the majority without the concurrence of the others.

(4) Where money or securities are deposited with a banker, broker or other depository, the court may order payment or delivery of the money or securities to the majority of the trustees for the purpose of payment into court.

(5) A transfer, payment and delivery made as a result of an order under this section shall be valid and take effect as if the order had been made on the authority or by the act of the persons entitled to the money and securities so transferred, paid or delivered.

RSN1970 c380 s49

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Court may hear action

49. Where in an action the court is satisfied that diligent search has been made for a person who, in the character of trustee, is made a defendant in an action to serve that person with a process of the court, and that person cannot be found, the court may hear and determine the action and give judgment against that person in his or her character of a trustee as if he or she had been served or had entered an appearance in the action and had also appeared by counsel at the hearing, but without prejudice to an interest the person may have in the matters in question in the action in another character.

RSN1970 c380 s50

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Indemnification of trustee

50. Where a trustee commits a breach of trust at the instigation or request, or with the written consent of a beneficiary, the court may make an order that the court considers just for impounding all or a part of the interest of the beneficiary in the trust estate by way of indemnity to the trustee or person claiming through the trustee.

RSN1970 c380 s51

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Joint trustees

51. The provisions of this Act relating to a trustee shall apply as well to several joint trustees as to a sole trustee.

RSN1970 c380 s52

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Remuneration of trustees

52. (1) Trustees, as defined by this Act, shall be allowed, over and above actual and necessary expenses, the remuneration that may appear to the court or a judge of the court to be adequate to their services, and the court or judge may apportion the remuneration among trustees that may appear just, according to the labour bestowed or the responsibility incurred by them respectively.

(2) The total remuneration shall not exceed 1/20 of the realized value of the assets.

(3) Where the assets have not been realized the court or judge may either order further realization or allow remuneration in respect of the unrealized part to a sum less than 1/20 of the value of the assets.

(4) In the case of continuing trusts the court or a judge may allow a person entitled to remuneration under subsection (1), (2) or (3) an annual care and management fee not exceeding 1/250 of the average market value of the assets under administration.

(5) In subsection (4) "average market value" means the monetary value arrived at by ascertaining the market value of the assets at the beginning of the period under consideration, adding the ascertained market value of the assets at the end of that period, and dividing by 2.

(6) Where an estate is less than $1,000 in value, the court or judge may allow the remuneration that it thinks adequate.

(7) Notwithstanding the other provisions of this Act, the compensation of the Registrar of the Supreme Court, when acting as a trustee, shall be governed by the rules of the court.

RSN1970 c380 s53; 1988 c8 s2

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Compensation in will, etc.

53. (1) Where a provision is made by a will for specific compensation to an executor, or the deed or other instrument creating the trust provides for compensation to the trustee, the compensation shall be a full satisfaction for his or her services instead of the compensation mentioned in section 52 or his or her share of that compensation, unless the executor or trustee by a declaration signed by the trustee or executor, filed in the court, renounces claim to that specific legacy or compensation so provided.

(2) A declaration referred to in subsection (1) shall be filed before probate or administration taken, or the acceptance of the office of trustee.

RSN1970 c380 s54

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Indemnity

54. (1) This Act, and orders purporting to be made under this Act, shall be a complete indemnity to persons for acts done pursuant to it.

(2) It is not necessary for a person to inquire concerning the propriety of an order, or whether the court had jurisdiction to make the order.

RSN1970 c380 s55

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