The complexities of family estate planning and the broad powers granted to trustees have taken center stage in a recent ruling from the Alberta Court of Appeal. What began as a father’s attempt to secure his family’s future through a land trust has evolved into a multi-year legal battle between siblings over three valuable quarter sections of land in rural Alberta. The case, which highlights the delicate balance between a trustee’s absolute discretion and their specific administrative obligations, recently reached a turning point as the province’s highest court weighed in1 on whether property can be forcibly transferred between family members before a full trial has even occurred. This dispute underscores the high stakes involved when family heritage, oil and gas revenue, and legal technicalities intersect in the courtroom.
The origins of the legal dispute between the Scammell siblings trace back to 2002, when their father established the Scammell Family Trust. This trust was designed to hold significant assets, specifically three quarter sections of land located in the municipal district of Provost, Alberta, along with various associated surface leases. At the time of its inception, the father appointed his wife, who was the mother of the parties involved in this litigation, as the sole trustee. The beneficiaries of this trust included the parents themselves, their five children, and eventually the parties to this appeal: Wanda Scammell, Colin Scammell, and Randy Scammell. The trust deed contained specific guidelines for how the assets should be managed and distributed, which later became the focal point of intense legal scrutiny.
According to the trust deed, the trustees were granted broad powers under a section titled Distribution of Trust Fund. This clause provided the trustees with absolute discretion to pay or apply the entirety or any portion of the income and capital of the trust to whichever beneficiaries they deemed advisable for any reason. This power was so broad that it explicitly allowed for the complete exclusion of any one or more beneficiaries. However, another section of the deed, focused on administration, placed a potential limit on how property could be moved. It authorized trustees to sell or transfer trust property to a beneficiary, but it stipulated that the consideration or price for such a transfer must not be less than the fair market value of the property. This tension between absolute discretion to distribute assets and the requirement to receive fair market value for transfers would eventually lead the family to the Court of Appeal of Alberta.
In February 2003, shortly after the trust was formed, the mother registered a caveat on the title of the three trust properties. This legal notice served to inform the public and any interested parties of her interest in the lands in her capacity as the trustee. For a decade, the arrangement remained stable. However, the situation began to shift in June 2013, when the mother transferred one of the three properties to her daughter, Wanda Scammell. The official records for this transfer indicated that Wanda paid 40,000 dollars in consideration for the land. Several years later, in August 2018, the mother executed further transfers for the remaining two properties to Wanda. These subsequent transfers were recorded as having been made for a consideration of only one dollar each. These transfers were registered in late 2018 and early 2019, effectively moving the legal title of all three trust properties from the trust into Wanda’s personal name.
The family dynamic changed significantly in June 2019 following the death of the mother. Under the terms of the trust deed, Colin and Wanda Scammell then became co-trustees of the Scammell Family Trust. It was during this period, following their mother’s passing, that Colin Scammell claims he first discovered that the three properties had been transferred to his sister years earlier. This discovery prompted Colin to take legal action. in June 2021, he commenced a lawsuit against Wanda, alleging that the transfers were not conducted for fair market value and therefore constituted a breach of the trust deed. He further alleged that Wanda was in breach of her duties by treating the lands as her own personal property rather than as assets belonging to the trust. Colin sought several forms of relief, including the removal of Wanda as a co-trustee and a court order to transfer the lands back into the names of the trustees.
Wanda Scammell defended the action in July 2021, maintaining that the transfers were entirely legal and within the bounds of the trust. She argued that their mother, as the original trustee, possessed complete and unfettered discretion to distribute the assets of the trust to her as a beneficiary. From Wanda’s perspective, the transfers were not sales requiring fair market value, but rather a valid exercise of the trustee’s power to distribute trust capital. As the litigation progressed, Colin Scammell moved for more immediate relief. In May 2023, he applied to have Wanda removed as a co-trustee and replaced by their brother, Randy Scammell. Crucially, he also requested an interim order to have the three properties transferred into the names of himself and Randy as joint tenants while the broader lawsuit awaited a final trial.
During the initial court proceedings, a chambers judge heard arguments regarding whether such a significant transfer of land should happen before a full trial. This type of request is known as a mandatory interlocutory injunction because it requires a party to take a positive action, such as signing over land, before the merits of the case are fully decided. The chambers judge ruled in Colin’s favor, finding that he had established a strong case. The judge noted that the lands had been transferred for significantly less than their fair market value and pointed to the fact that the mother’s 2003 caveats remained on the titles as evidence that the lands were intended to stay within the trust. The judge also concluded that the trust would suffer irreparable harm in the form of unquantifiable losses if the land were not moved. Consequently, the judge ordered Wanda to transfer the properties and removed her as a trustee due to a conflict of interest.
Wanda Scammell appealed this decision to the Court of Appeal of Alberta, leading to the judgment released in December 2025. The appellate court focused heavily on the rigorous legal standards required for a mandatory injunction. The court explained that because a mandatory injunction forces a defendant to take a positive step before a trial, the person asking for it must show a strong likelihood that they will ultimately win the case. This is a much higher standard than the one used for most other types of preliminary court orders. The Court of Appeal found that the chambers judge had not sufficiently analyzed how the trust’s absolute discretion clause interacted with the fair market value clause. Without a deeper dive into the legal interpretation of these conflicting sections, it was premature to conclude that Colin had a strong enough case to justify an immediate transfer of the land.
Furthermore, the Court of Appeal addressed the significance of the 2003 caveats. While the lower court saw the remaining caveats as proof that the land belonged to the trust, the appellate court clarified that a caveat is merely a notice of a claim and does not prove the claim is valid. The court noted that because the mother herself had signed the transfer documents years later, her failure to remove the earlier caveats might have been an oversight rather than an intentional act to keep the land in the trust. Without more evidence, such as testimony from the lawyer who handled the transfers, the existence of the caveats was not enough to establish a strong likelihood of success for Colin’s claim.
The appellate court also identified errors in the assessment of irreparable harm. In Canadian law, irreparable harm refers to damage that cannot be fixed with a monetary payment. Colin had argued that the trust was losing rental income and surface lease payments because of Wanda’s control of the land. The Court of Appeal disagreed that this constituted irreparable harm, stating that any lost income is easily quantifiable in dollars. If Colin eventually wins the trial, the court can simply order Wanda to pay the calculated amount of lost rent. The court also noted that there was no evidence presented to prove the land was so unique that a monetary award would be an inadequate remedy. Because the harm was financial and could be cured with money, the high bar for an injunction was not met.
Despite reversing the order to transfer the land, the Court of Appeal reached a different conclusion regarding Wanda’s removal as a trustee. The court acknowledged that a trustee can be removed if their personal interests conflict with their duties to the trust beneficiaries. In this case, Wanda’s personal interest in keeping the land for herself was in direct opposition to the interests of the other beneficiaries who wanted the land returned to the trust. The court observed evidence suggesting that Wanda had already prioritized her own interests by withholding certain records and managing surface leases in a way that benefited her personally. Even though a trial has not yet determined who truly owns the land, the court found that the ongoing litigation made it impossible for Wanda to manage the trust objectively.
In its final determination, the Court of Appeal of Alberta allowed the appeal in part. The court set aside the order that required Wanda to transfer the three parcels of land, meaning the ownership will remain as it currently stands until the full trial takes place. Any transfers that had already occurred as a result of the lower court’s order must be reversed. However, the court upheld the decision to remove Wanda as a co-trustee and confirmed the appointment of Randy Scammell in her place. This ensures that the trust will be managed by individuals who are not currently claiming personal ownership of the trust’s primary assets. The court noted that these orders regarding the trustees could be revisited once the underlying lawsuit is finally resolved.
Read more cases from Alberta here.
