Wills and Estates Associate Lawyer and Accredited Aged Care Professional, Larisa Kapur, joins Robyn Hyland on Radio 4CRB to debunk some common misconceptions about the role of executors appointed in a Will in the administration of a deceased estate. It’s time to separate fact from fiction and set the record straight.
Introduction
When it comes to drafting your Will as part of your estate planning, the role of an executor is often misunderstood, underestimated, and not fully explained by lawyers or unqualified public servants from the Public Trustee. Executors play a crucial role in carrying out the wishes of the deceased and upholding the terms of the Will, but there are some common misconceptions surrounding their appointment, responsibilities and duties. There are statutory duties under the Queensland Succession Act. These misconceptions can lead to misinformation, disputes, and potentially impact the estate administration process. In this blog, we uncover misconceptions about executors and unravel the truth behind the executor’s role in a Will and the administration of a deceased estate.
1. Can an executor also be a beneficiary?
Yes, an executor can also be a beneficiary named in a Will. In fact, it is usual to appoint your spouse as executor and sole beneficiary of your estate and also quite common for adult children to be appointed as both executors and beneficiaries in their parent’s Wills. This can be a convenient option, as the executor is often already familiar with the testator’s wishes (and assets) and can effectively handle the administration of the estate. However, situations can arise where there are multiple adult children named as beneficiaries, but only one is named as executor. In such cases, there may be concerns among the sibling beneficiaries about whether the executor is making decisions that truly prioritise the best interests of all beneficiaries or if their own interests may take precedence. This can lead to disputes and conflict among the beneficiaries. Sometimes, it may be wise to appoint an independent executor, such as an experienced lawyer in this complex area of law.
2. Can an executor back out of their role at any time if they decide they no longer want to perform their duties and it gets too hard?
If an executor does not wish to take on the role, following the passing of the testator of the Will, they must renounce their position immediately before beginning the estate administration process.
Once a person has accepted the role of executor and a grant of probate has been made, the executor is deemed to have ‘intermeddled’ in the estate, and they generally cannot refuse to continue without leave of the Court or being removed as executor. However, they can renounce in Queensland prior to obtain a grant of probate even if they have intermeddled (S.54 (2) of the Succession Act).
Executors should seek guidance from an experienced estate administration lawyer who can assist in fulfilling the duties and obligations of the role, including advice as to whether they should renounce.
3. Does an executor get paid to do the role? Executor commission
Generally, if a Will does not provide any basis for fees and charges to be paid to the executor (usually if they are a professional), they will not receive compensation or payment for the duties they perform, but they can claim ‘executor commission’ in certain circumstances.
The level of work performed by an executor or their ‘pains and troubles’ will vary depending on the estate.
For more complex estates, an executor may be able to claim reasonable executor commission, which means they are essentially charging for the ‘work’ they perform and their pains and troubles in administering the assets of the estate. However, it isn’t simply a matter of sending the estate an invoice. To seek a commission, the executor must apply to the Supreme Court for approval of their commission claim in the absence of agreement from the beneficiaries, and this can be a costly affair.
If someone chooses to appoint a professional to be their executor, such as a lawyer, most professionals will charge for their services to administer a Will.
Read more: Executor’s commission
4. Does an executor need to have legal and financial qualifications?
No. While having some qualifications can be beneficial, they are not mandatory, and anyone can be appointed as an executor in a Will (although someone who is bankrupt or in jail cannot fulfil their role as executor – they must also be a ‘fit and proper person’).
It is common for people to appoint their adult children to the role, or their siblings, despite their lack of qualifications. The primary requirement for an executor is to act in a reasonable and trustworthy manner, carrying out the wishes of the deceased and promptly administering the estate.
Having said that, in complex estates, or matters that involve difficult family relationships, it can be advantageous to appoint an independent professional to take on the role of executor, such as a lawyer or accountant, who has the necessary skills to ensure the administration process can proceed smoothly, without delay, reducing the risk of family conflict and the overall legal costs.
5. Can an executor alter what is detailed in the Will, changing what gifts go to each beneficiary?
The executor does not have the authority to unilaterally alter the contents of a Will or change the gifts specified to go to each beneficiary.
The executor should be upholding the wishes of the deceased as expressed in the Will and acting in the best interests of the beneficiaries and the estate.
However, there are certain circumstances where an executor may be able to change the distribution of assets by way of a Deed of Variation (or Deed of Family Arrangement). This can only occur if the executor obtains the express permission of ALL the estate’s beneficiaries. Under a Deed of Variation, an executor can change a beneficiary’s entitlement in a Will.
An example of when an executor may seek a Deed of Variation could be if the executor identifies that the Will’s distribution would result in a substantial inheritance tax liability for one of the beneficiaries. The executor may then discuss the situation with the beneficiaries and come to an alternative agreement to mitigate the tax implications and ensure a fairer distribution of assets among the beneficiaries. A Deed of Variation must be executed within a specific timeframe, usually within two years of the deceased’s passing, to be effective for tax purposes.
6. Can an executor speed up the probate process?
Probate can take anywhere from 8-12 weeks from the date of death and will depend on the court’s workload and how complex the probate application is.
Certain things can delay probate, such as not being able to locate the deceased’s Will, organising the assets and liabilities of the estate, obtaining the official death certificate, and getting together the required documents for the probate application.
These are all things the executor should be striving to achieve to ensure they do not delay the process.
Whilst there is no strict deadline for an executor to apply for probate in Queensland, they do have a statutory and fiduciary duty to the estate to administer it in a swift and efficient way. In NSW, a grant must be applied for within 6 months of the date of death, or an explanation is required under the Supreme Court Rules.
Read more: Executors behaving badly – how should an executor conduct themselves
7. Can an executor be held personally liable for expenses incurred administering an estate?
There are a lot of costs and expenses associated with a deceased estate that extend beyond arranging the funeral, and in many cases, these need to be paid upfront by the executor.
It is important for executors to know that if they distribute assets before finalising the administration (or before the statutory time limits for protection have expired), or without making appropriate arrangements for the payment of all liabilities of the estate, that they may be held personally liable for any losses or unpaid debts.
Executors must be aware of the costs of administering the estate, and what is expected of them and to seek legal advice as soon as possible from a lawyer that specialises in estate administration to ensure they are adhering to their obligations and doing everything in the right order to reduce the risk of exposing themselves to personal liability.
Read more: Executors beware! You may be personally liable for expenses of administering an estate
8. If there is no Will, does the Court choose who takes on the role of executor?
If someone dies without a Will, it means there is no executor and they have died intestate and the laws relating to intestacy apply. There is a list of who has priority to apply for a grant and how the estate assets are to be divided in each of the states and territories Succession legislation in Australia (e.g., S.35 Succession Act QLD).
What usually happens is the next of kin, or the deceased’s spouse, apply to the court for Letters of Administration, which must be granted by the court once the application has been reviewed. Once granted, then the administrator can proceed with the estate administration.
Applying for Letters of Administration can be quite complex and anyone making an application must:
- Advertise their intention to apply
- Provide a copy of the notice to the Public Trustee
- Give people time to object
- Prepare the required documents for the application
- File the application in the Supreme Court.
If everything is in order, the court will issue the grant. If the application for Letters of Administration is rejected for whatever reason, such as the person applying did not provide sufficient evidence or documentation, or there was conflict among potential administrators, the court may choose to appoint the Public Trustee or an independent administrator to oversee the administration of the estate.
Attwood Marshall Lawyers – experts in estate administration
The role of executor can be an onerous one and it isn’t necessarily for everyone. There is a lot to it! It is important that anyone who has been appointed to this role understand that they do not have to go it alone. Legal support is available to help executors ensure the administration process runs smoothly and that all duties are fulfilled.
Attwood Marshall Lawyers has one of the largest and most experienced Wills and Estates departments in Australia, with dedicated teams who practice exclusively in estate administration, estate planning, and estate litigation.
We can support executors in their role and help them navigate the many obstacles that often arise during the administration process.
If you would like to discuss an estate or obtain advice about acting as executor, please contact our Wills and Estates Department Manager Donna Tolley on direct line 07 5506 8241, email dtolley@attwoodmarshall.com.au or book an appointment instantly using our online booking app.
