Appointment of a Receiver – Do Trust “Powers” Constitute “Property”?

The British Columbia Court of Appeal recently considered the issue of whether certain powers over property in a discretionary estate trust could be considered to be “property” over which a receiver of a debtor’s personal assets is entitled to take control.  The issue was whether the debtor, who was a discretionary beneficiary of the trust and its Protector (meaning he had the ability to appoint a trustee), had a “property interest” in the trust.  The argument in favour of the receiver was that the debtor had discretion or power over the appointment of a trustee (which could be himself) such that he had the ability to direct discretionary payments from the trust if he so chose.  The Court rejected this rationale, finding that “powers” over the administration of trust properties are not equivalent to property itself and therefore do not fall within the authority of a receiver.

Quest Capital Corp. v. Longpre

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