CanadaCan a court vary the terms of a trust if circumstances change?
Yes, Canadian courts can vary trust terms when circumstances change significantly, but only under limited statutory authority or through the doctrine of cy-près — not simply because it seems fair or convenient.
What the Law Says
Canadian provinces empower courts to vary trust terms in narrow, defined circumstances — primarily where the trust’s original purpose becomes impossible, impractical, or illegal, or where all beneficiaries consent and the variation is consistent with the settlor’s intent.
No general 'change-of-circumstances' power exists in Canadian trust law. Courts cannot rewrite trusts merely because conditions have evolved — that would undermine the settlor’s autonomy.
Instead, provincial Trustee Acts authorize variation only in specific situations. For example, Ontario’s Trustee Act permits court approval of variations where all beneficiaries are competent, consent, and the change doesn’t violate the trust’s essential purpose.
British Columbia’s Trustee Act similarly allows variation under s. 50(1) if the court is satisfied the proposed change benefits the beneficiaries and aligns with the settlor’s intent — but only after notice and hearing.
What Courts Have Said
The Supreme Court of Canada has affirmed that courts lack inherent jurisdiction to alter trust terms — variation requires either statutory authority or application of the cy-près doctrine.
The Court held that trustees cannot unilaterally encroach on capital for a life tenant’s benefit unless expressly authorized by the trust instrument or statute; courts likewise lack broad discretion to vary trusts — such power must be grounded in legislation or established equitable doctrine like cy-près.
What to Do
Review the trust deed carefully to identify any express variation or encroachment powers granted to trustees.
Confirm whether all beneficiaries are adults, mentally capable, and unanimously consent to the proposed change.
Consult the applicable provincial Trustee Act (e.g., Ontario s. 62 or BC s. 50) to determine if statutory variation is available.
Apply to the superior court with evidence showing the change serves beneficiaries’ interests and respects the settlor’s fundamental intent.
If the trust’s purpose has failed entirely (e.g., charity no longer exists), consider invoking the cy-près doctrine with court approval.
Sources
Not legal advice. This article is general information based on publicly available sources, written for educational purposes. Laws change and individual situations vary. Consult a licensed attorney in your jurisdiction before acting on anything you read here. Last reviewed: 2026-06-08.