CANADA Law and Practice Contributed by: Ian Hull, Suzana Popovic-Montag and Nick Esterbauer, Hull & Hull LLP
accounts (essentially a court audit of their administra - tion of the trust). On a passing of accounts, a benefi - ciary who is displeased with the administration may seek damages against the fiduciary. As trustees in Canada are guided by the “prudent investor” rule, trust property should not be exposed to unnecessary risk. Investments should involve low risk with steady returns and allow the trust to be administered in accordance with the trust document – for example, the investments should not limit the liquidity of the trust during times at which distributions ought to be made. The investment of trust property should be diverse, and should consider the require - ments imposed by the trust document and the nature of the trust property, as well as the current market conditions. The risk of an investment portfolio is con - sidered in its entirety, rather than individual aspects. Diverse portfolios are typically associated with lower risk levels. Other Applicable Investment Standards Modern portfolio theory is a standard of risk-averse investment and uses balanced portfolios to optimise expected return based on a given level of market risk, emphasising that risk is an inherent component of a potential increase in rate of return. The fiduciary standard may attach to any investment professional who is required to act in their client’s best interests, such as brokers and insurance agents. How - ever, a suitability standard applies when financial pro - fessionals act in a sales capacity, and requires one to act in service of a client’s stated needs and objectives. 7. Citizenship and Residency 7.1 Requirements for Domicile, Residency and Citizenship Domicile in Canada For an individual to be domiciled in Canada, the com - mon law requires that they either: • were born to parents domiciled in Canada (in which case their domicile of origin will be Canada) and failed to acquire a domicile of choice not subse - quently abandoned; or
• acquired a province as a domicile of choice by unequivocally intending to reside there perma - nently, without a specific and/or temporary reason for doing so. Courts may consider a variety of factors in determin - ing where one is domiciled, including where family is located and where real property is owned or rented. If an individual is domiciled in Canada at the time of death, their estate will be administered in accord - ance with the law of the province in which they were domiciled. The province would also be the appropri - ate place to apply for probate of that person’s estate, unless the deceased held real property in another jurisdiction. Residency in Canada Permanent residency is granted on the basis of a points system, using the education, age, language skills and work experience of the applicant. Different programmes may be available to different categories of applicants who are interested in becoming perma - nent residents of Canada. Canadian Citizenship Canadian citizenship is required in order to obtain high-level security clearance jobs or to vote or run for political office in Canada. There are several require - ments that must typically be met in order for a citizen - ship application to be successful, including: • attaining permanent resident status; • demonstrating a settled intention to reside in Canada; and • successful completion of the Canadian citizenship test. To qualify for citizenship status, an individual must normally have been physically present in Canada for at least 1,095 days during the five years immediately
prior to the date of application. 7.2 Expeditious Citizenship
If an individual satisfies the citizenship requirements referred to in 7.1 Requirements for Domicile, Resi- dency and Citizenship , the following mechanisms
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