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WA Public Trustee over-charges grieving husband $19,000 for transferring shares and bank accounts

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Attwood Marshall Lawyers Estate Litigation Special Counsel, Lucy McPherson, recently joined ABC News to discuss a case where the WA Public Trustee charged a grieving husband more than $19,000 to act as executor in the modest estate of his late wife, where most assets were owned jointly.

Introduction

Losing a loved one is one of the toughest moments in someone’s life.

Following the death of a loved one, the estate administration duties must be tended to, to finalise the deceased’s estate. Trying to deal with the deceased’s bills, value the estate, identify and pay creditors, transfer assets, and communicate with third parties, including financial institutions, Medicare, utility providers, just to name a few, can be a time-consuming and stressful process to endure. That is why it is common for many people to appoint an independent third party as the executor in their Will.

When people appoint a third party as executor of their Will, they often do so to avoid placing extra burden on their loved ones during a time they are already grieving. When appointing an independent third party, a Will-maker usually takes comfort in knowing that their chosen executor will have the compassion, knowledge and experience required to administer the estate effectively.

Unfortunately, when that third party fails to do what’s right by the beneficiaries of the estate or fails to fulfil their duties in the expected timeframe at an appropriate cost, it can become a nightmare for the beneficiaries of the estate who only want to finalise the estate of their loved one so that they can move on peacefully, as quickly as possible.

In yet another horror story aired by ABC News, a grieving husband has shared his experience with the WA Public Trustee, who he and his wife had appointed as executor in their Wills. He describes how they failed to meet their obligations to manage the deceased estate for the benefit of the beneficiaries, and how they overserviced the estate, accruing exorbitant fees in the tens of thousands of dollars.

Lucy McPherson guest appearance on ABC News

Attwood Marshall Lawyers Estate Litigation Special Counsel, Lucy McPherson, who practices exclusively in this complex area acting for clients against the Public Trust Offices across Australia, was a guest commentator on the ABC News program.

Lucy stated that it was “astounding” to hear how much Mr Adamson was charged for the management of an estate with a simple asset structure.

“Certainly, I would think that’s more than double what would be required in that situation.”

“An executor of an estate has a duty and obligation to maximise the benefit of the estate for the beneficiaries,” she said.

These stories are becoming more common with many people speaking out about their devastating experiences dealing with Public Trustees around the country.

Read more: WA’s Public Trustee charges man $19,000 to manage wife’s estate
Read more: Perth man left homeless after Public Trustee WA ‘squanders’ $2.8 million payout
Read more: Qld Trustee claims probed after TV report

Charging exorbitant fees to manage an estate with a simple asset structure

Mr Barry Adamson has spoken to ABC News about his ordeal dealing with the WA Public Trustee following the death of his wife, Maxine.

Mr Adamson was sent a bill in excess of $19,000 from the WA Public Trustee for their services administering his wife’s estate.

The majority of the work involved transferring bank accounts and shareholdings into his name.

What should have been a relatively simple task resulted in the WA Public Trustee charging 28 hours of work on the estate, which was about 7.4 per cent of the total value of the estate.

Mr Adamson tried to raise questions about the bill but was unsuccessful in getting answers over the phone or by email, which is a common complaint from many Public Trustee clients.

He then requested a review of his fees via the WA Public Trustee’s feedback section on their website. The bill was reviewed by the Director of Trustee Services, and it was agreed that Mr Adamson had grounds for a fee waiver, and the Public Trustee agreed to halve the bill.

Despite the reduction, the reduced fees still appeared to be an inflated amount compared to what someone with similar experience could charge for performing the same tasks, such as a stockbroker or lawyer.

Some Public Trustees are self-funded agencies, which means they need to cover their own operating costs through fees, charges, and investment revenue. There is no doubt that there are serious issues about the level and complexity of the Public Trustee’s system and lack of transparency about earning revenue from their client’s funds and charging appropriately for their services.

Appointing the Public Trustee as Executor of an estate

It is common for people who utilise the estate planning services of Public Trustees to be encouraged to appoint the Public Trustee as executor in their Will.

Most of the time people are attracted to the offer of a free Will service by the Public Trustee because it saves them money upfront, however, in most cases, clients of the Public Trustee do not fully comprehend what the fee structure is once the Public Trustee steps in to administer an estate as the executor. People assume the Public Trustee offer a more affordable option, compared to engaging a law firm or private trustee to do the same task, but unfortunately that is not the case. This is particularly so with married or defacto partners who mainly have joint assets that need to be transferred over to the surviving partner after one of them dies. Part of the ‘free Will’ pitch is for the couple doing their Wills to appoint the Public Trustee as Executor. There is no disclosure of what the fees will be to act as Executor in the estate (unlike Lawyers in private practice who are required to disclose this ‘conflict’ before being appointed).

It is only when it is too late, after someone has passed away and the beneficiaries are left to dispute substantial fees that many people realise the Public Trustee is not what it promises to be.

When a trustee company is appointed as executor, including the Public Trustee, they have a duty and obligation to maximise the benefit of the estate for the beneficiaries. As part of that obligation, costs should be minimised in the administration process.

The WA Public Trustee has had its fees and charges audited recently, and although it was noted throughout the audit that the fees charged on estates reflected what was in the fee schedule, the question was raised whether the Public Trustees fees for managing trust accounts on behalf of vulnerable people reflected the actual work involved in doing the job.

Many people do not understand the complex fee structures and associated work being charged and may feel intimidated to challenge the fees.  

How is it possible the Public Trustee can overservice and overcharge?

It is our view that Public Trustees can overservice and overcharge for a number of reasons, including incompetency on the part of the ‘Trust Officers’ undertaking the work (often, individuals undertaking the work on these matters are not legally trained and will make mistakes and consequently cause delay), and the fact the fees and charges are regulated (i.e. the Public Trustee is entitled to charge what it does as the costs are enshrined in legislation).

Attwood Marshall Lawyers can help to remove the Public Trustee

Our team continue to get enquiries from people who have been disadvantaged due to the actions of Public Trustees all around Australia. Notably, we have seen an increase in Western Australian enquiries.

Despite not having a local office in Western Australia, we can take on cases in most jurisdictions to help people understand the process to have the Public Trustee removed, or to challenge exorbitant fees being charged on a deceased estate.

Attwood Marshall Lawyers are one of the few legal firms that have a dedicated, experienced team of lawyers who handle Public Trustee disputes. We will fight for compensation for beneficiaries and estates that have been drained of their assets and ensure the Public Trustee are upholding their fiduciary duties.

If you are involved in a dispute with the Public Trustee and need advice, contact our Estate Litigation Department Manager, Amanda Heather, on direct line 5506 8245, email aheather@attwoodmarshall.com.au or free call our 24/7 phone line on 1800 621 071.

We have office locations at Coolangatta, Robina Town Centre, Kingscliff, Brisbane, Sydney and Melbourne. Should you matter be in another location, we are able to arrange a telephone or Zoom consultation to discuss your needs.

Read more:

Queensland Public Trustee keeps behaving badly: ABC’s 7.30 Report program exposes more horror stories

PODCAST: Families Forced to Take Legal Action Against Public Trustees

4 Corners program exposes Public Trustee horror stories: vulnerable Australians trapped, neglected, stripped of assets, charged grossly excessive fees, and silenced with their own money!

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Lucy McPherson

Special Counsel
Estate Litigation

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Disclaimer
The contents of this article are considered accurate as at the date of publication. The information contained in this article does not constitute legal advice and is of a general nature only. Readers should seek legal advice about their specific circumstances. 

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