Lucy McPherson, Special Counsel for Estate Litigation at Attwood Marshall Lawyers reviews a recent Queensland Supreme Court case where an executor was removed and replaced with an independent solicitor to act as executor after failing to administer her late mother’s estate.
The Case: Newman v Predo [2022] QSC 170
Mrs Sylvia May Jacobs died on 29 November 2018 and left behind a Will that appointed one of her daughter’s, Mrs Jennifer Predo, to be her sole executor and trustee. In the Will, Mrs Jacobs left instructions that if her daughter were unable or unwilling to fulfil her duties as executor, that her grandson, Christopher Beijnon, would be appointed to take on the role as substitute.
Mrs Jacobs had eight children and stepchildren and left behind a reasonably straightforward estate with the principal asset of the estate being a home in Bellara on Bribie Island.
Mrs Predo took on the role of executor following her mother’s passing, however, over three and a half years passed, and she failed to fulfil her duties and administer the estate.
Mrs Vicky Newman, one of the beneficiaries and sister of the executor, made an application to the Supreme Court of Queensland to seek removal of her sister as executor and trustee of the estate.
Mrs Predo was accused of:
- Failing to prepare and lodge tax returns for the estate over three financial years.
- Failing to obtain a valuation and sell the Bellara property, which then sat vacant. As a result, the property was likely going to attract capital gains tax which would need to be paid once the property was eventually sold; a liability that could have been avoided if the property was sold within two years of the death of the deceased.
- Failing to secure appropriate qualified legal help to assist in administering the estate.
- Failing to provide a proper account of the estate despite several requests for such information being made by the beneficiaries. The value of the estate remained a mystery.
- Displaying conduct that showed she was unsuited to perform the duties of executor.
The Court’s Considerations
The Court has wide discretion to remove an executor in appropriate cases. The jurisdiction to do so is both supervisory and protective.
In this case, it was up to the Court to determine whether removal and replacement of the executor was necessary to ensure “the due and proper administration of the estate”. The only way to determine this was by referencing what was in the best interests of persons with an interest in the estate, including beneficiaries and creditors.
The Court considered:
- The respondent’s refusal to provide a proper account of the estate;
- The respondent’s failure to preserve the estate and avoid unnecessary legal costs;
- The respondent’s failure to seek assistance from a competent solicitor to administer the estate;
- The conduct of the respondent towards the beneficiaries and legal proceedings.
Although in many cases estate disputes that result in litigation will see the estate pay for the legal costs incurred by the executor, it is not uncommon for a Court to order that the executor pay the other side’s legal costs out of their own pocket if they are proven to have failed to fulfil their duties and have neglected an estate.
Ultimately, it will be at the Court’s discretion as to who is responsible for costs and if it is to be paid from the estate.
In this case, the Court ordered that the grant of probate issued to Mrs Predo be revoked and the grant of probate be delivered by Mrs Predo to the registry of the Court.
Letters of Administration were then granted to an independent solicitor experienced in estate administration matters to act in the role of administrator of the estate.
Mrs Predo was ordered to deliver all documents in her possession to the administrator.
The Court also acknowledged that the application raised by the applicant was most necessary in the interests of all beneficiaries, and it would be wrong for the applicant to bear the costs for needing to do so. Mrs Predo was unsuccessful in opposing the application and was ordered to pay the applicant’s costs.
Key Takeaways
When writing a Will, it is imperative to think very carefully about who you choose to be your executor. The role of executor is quite onerous and not all people will be up to the task. If there are complex family dynamics to consider, and suspicion of legal disputes arising in relation to the estate and decisions being made by the chosen executor, it can be beneficial to appoint an independent third party to be the executor to ensure disputes are mitigated and the role be fulfilled in a timely manner. Although many lawyers are reluctant to act as executors, sometimes it is the wisest thing to do so that someone experienced in this area of law can take whatever steps are necessary to administer the estate and distribute the assets to the beneficiaries. The alternative of warring siblings or family members incurring unnecessary legal costs is a far more expensive than paying the costs of a lawyer as executor. Normally, the executor engages a lawyer to obtain a grant of probate and administer the estate anyway. Appointing a lawyer shortcuts this process.
Sadly, we see these types of matters all too often. It’s not just from families where one family member has been appointed executor and isn’t doing the right thing, it is also a common occurrence with Public Trustee matters, where someone has done their Will with the Public Trustee, and in the all-too-common occurrence, have appointed the Public Trustee as the executor of the estate. There are many cases where the Public Trustee fail to administer estates appropriately or in a timely manner, draining estates of their value, leaving properties to rot, all while the beneficiaries are trying to find out what is going on.
No matter who is appointed as executor, whether it is an organisation like the Public Trustee, or a family member of the deceased, if the executor is not doing the right thing, you need to get legal advice at the earliest opportunity and make an application to the Supreme Court to have the executor removed for the benefit of the estate and its beneficiaries.
If you are appointed to be the executor of someone’s estate, and decide it is not a role you want to take on, you must renounce your position prior to intermeddling in the estate.
Attwood Marshall Lawyers – Experts in Estate Litigation
Accepting the role of executor can come with significant burden. There is value in appointing an experienced, independent professional to act in the role.
Attwood Marshall Lawyers offer executor services for people who do not have anyone in their life they trust or believe will be able to perform the duties appropriately. When you choose Attwood Marshall Lawyers as your executor, you can have confidence that the estate administration process will be fulfilled efficiently, without any delays, and that any family conflict will be minimised and kept separate.
If you are a beneficiary of an estate and are having a difficult time getting information from the executor or believe the executor of the estate is failing to perform their duties appropriately within the required timeframes, we can help you make an application to remove the executor and appoint an alternative person to the role.
It is important to get trusted advice to discuss your specific matter to understand your rights and the best action to take that will minimise costs to the estate and ensure you do not end up taking action that may be unsuccessful.
Contact our Estate Litigation Department Manager, Amanda Heather, on her direct line 07 5506 8245, email aheather@attwoodmarshall.com.au or free call 1800 621 071 to make an appointment with one of our experienced estate litigation lawyers.
Our lawyers are available for appointments at all our office locations at Coolangatta, Robina Town Centre, Southport, Kingscliff, Brisbane, Sydney and Melbourne.
