Beneficiaries At Odds Over Distribution Of Artwork

Written on behalf of Arbesman Hamilton LLP

One of the most important reasons people choose to create an estate plan is to minimize the likelihood of disagreements amongst family and other heirs of an estate. Unfortunately, it’s impossible to guarantee this won’t happen, and every estate has its own unique factors which could lead to friction. This was the case in a recent decision from the Ontario Superior Court of Justice where the family of an artist disagreed over how to distribute the artwork he left behind.

The story behind the conflict

The deceased was described by the court as a renowned Canadian figure skater and artist. He passed away in Mexico on January 23, 2015. He had lived there for 23 years. He died without a will, and his three siblings (“MB”, “G” and “C” were declared  his sole heirs. MB was named the executor of the estate.

The deceased left  behind a large estate, estimated to include about 20,000 pieces of artwork, bank accounts, and property. The original value of the estate was determined to be approximately $6,258,520.

Siblings divided

The siblings initially worked together. They sold the real estate, some artwork, and some other items. The remaining artwork and items were divided between them. Unfortunately this spirit of cooperation was short lived. Both G and C eventually became concerned that MB has been mismanaging the estate. They had particular concerns about how the unsold artwork was being handled.

Both G and C were opposed to MB’s plans to sell the remaining artwork and divide the proceeds amongst the three beneficiaries. Instead, they were asking for the pieces to be distributed amongst the beneficiaries. They also claimed they had not been provided with an accounting of what pieces of art had been sold, were on storage, or were for sale. G owns an art gallery in Nova Scotia and argued his gallery could be used to sell paintings, which would mean the estate would not have to pay a third-party gallery to do the same. C and G also stated they had not been included in discussions in how to further monetize the artwork, such as through the publishing of a coffee table book.

Ultimately, they were concerned that they didn’t know if MB was acting with the best interests of the estate. They sought that an Estate Trustee During Litigation (ETDL) be appointed while the courts determined what should be done with the artwork.

MB on the other hand said she was indeed acting in the best interests of the estate. She admitted that she was selling the artwork over the objections of her siblings, but that she was entitled to do so as the Estate Trustee. She said that her siblings had already received distributions of money from the sale of art, and that if they were all trying to sell the artwork at the same time, it could result in “fire sale pricing.”

The court’s decision

The court did not make a determination in regards to whether the artwork should be sold by the estate or distributed amongst the parties. It did, however, find this to be an appropriate instance in which an ETDL should be appointed. The court appointed one and tasked him with developing a plan for the distribution and/or liquidation of the remaining artwork based on consultation with all three beneficiaries.

Contact the experienced estate litigation lawyers at Arbesman Hamilton LLP in
Toronto to learn how we can protect your interests and achieve the best
possible resolution of your estate dispute. Contact us online or at 416-481-5604 to
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