Boettger – Quebec Court of Appeal confirms that a trust with an Alberta trustee, who was a mere “implementer” of the Quebec settlor’s wishes, was resident in Quebec
An Alberta trust was found by the Court of Quebec below to be resident in Quebec. The settlor and beneficiary (his wife) were unfamiliar with the sole trustee (an Alberta lawyer), who instead was a contact of the Montreal law firm (and who could be removed by the settlor at any time). The most significant act of the trustee was something he was directed to do under the trust deed and thereafter there was essentially nothing for him to do other than send in the trust tax return along with payment. Lavigne J stated "The role of the Trustee was not to manage and grow the assets of the NS Trust but rather to hold them passively and follow the detailed steps in the Plan dictated by the [professional advisors]."
St-Pierre JCA in the Court of Appeal essentially agreed with all the significant findings of Lavigne J, other than to indicate that she had given too much prominence to the tax motivation for the trust. However, this was not important:
If the Judge decided that the residence of the trust was in Quebec, this was not by reason of the underlying tax motivation for its establishment, but because the established facts demonstrated that the control of its actual activities and that the management of its affairs rested practically (in reality) in the hands of its settlor, and not in those of the trustee who, in fact, acted only as the implementer ["exécutant"]. …
The tax motivation is a fact.
This fact constitutes a backdrop to take into account respecting the trust and its actual activities. [emphasis in original]
Neal Armstrong. Summary of Boettger v. Agence du revenu du Québec, 2017 QCCA 1670 under s. 2(1).