I Don’t Trust The Executor (NSW)
A testator must choose an executor who they trust to take care of their deceased estate. Preferably, this person should be someone who the deceased’s family and friends would also find trustworthy. After the death of a testator, the executor will need to work closely with the family of the deceased and any other named beneficiaries. In this situation, a problem can arise if the beneficiaries of the will don’t trust the executor. This article explains how to identify an untrustworthy executor and what to do if you don’t trust the executor of a will in New South Wales.
Rights Of Beneficiaries Who Don’t Trust the Executor
Firstly, it is important for a beneficiary to understand their rights under the Succession Act 2006 and the Probate and Administration Act 1898. A beneficiary is not without power when it comes to holding an executor to account for the administration of a deceased estate. A beneficiary is entitled to know whether they are listed as a beneficiary in the will, the nature of their bequest, the extent of the deceased estate as a whole, and when they are likely to receive their entitlement. The beneficiary also has a right to receive updates if there are any delays in the distribution of the estate. This includes any developments that may affect their bequest, such as legal contests of the will or claims against the estate.
Fiduciary Duty Of An Executor
An executor is bound by multiple legal obligations, particularly their fiduciary duty to the beneficiaries of the estate. This means that they are placed in a position of extreme trust, responsible for caretaking a deceased estate until it is distributed and protecting the rights of the deceased’s beneficiaries.
A beneficiary may not trust an executor because they feel like the executor is holding on to the estate and not passing on their rightful entitlement. This is a relatively common complaint because an executor is obligated to wait a certain amount of time before they give out the bequests. In New South Wales, the executor is strongly advised to wait at least six months to distribute the will to allow any creditors or claimants against the estate to come forward. A beneficiary should not begin to worry about the distribution of the will until a year has passed since the testator’s death. In New South Wales, a beneficiary should receive their inheritance after a year unless there are other arrangements in the will.
A beneficiary may reasonably distrust any executor who does any of the following:
- Refuses to communicate with the beneficiaries in a timely manner;
- Causes unwarranted delays to the administration or distribution of the estate;
- Fails to properly account for the estate assets;
- Places their own interests ahead of the estate;
- Buys estate assets themselves or sells them to friends under market value;
- Makes a profit from their position other than through a reasonable executor’s commission;
- Delegates their executor responsibilities without authorisation;
- Fails to act impartially and does not treat beneficiaries fairly;
- Fails to prudently manage and invest estate monies;
- Does not follow the testator’s instructions; or
- Does not keep comprehensive financial records of the estate transactions;
Removing A Person You Don’t Trust as Executor
An executor has access to significant assets and sums of money. An executor could theoretically abscond with these funds or misuse or squander them. Because of this risk, beneficiaries should not hesitate to request the removal of an executor if there is true mismanagement of the estate.
If an executor breaches their fiduciary duty, they may be subject to serious financial and legal ramifications. As the breach of duty will certainly affect the outcome of the estate administration, it is important to take action without delay.
The Supreme Court of NSW can order the removal of an executor. This is achieved through revoking the Grant of Probate and issuing a new grant to an appropriate administrator. The Registrar can deal with the issue in chambers (that is, without requiring a court hearing) if there is no opposition to the motion. The court must receive sufficient cause to justify the removal of the executor, beyond a beneficiary’s general distrust or personal dislike. The beneficiary must produce evidence that the executor has displayed misconduct or neglected their duties because of incompetence, carelessness or malicious intent.
A beneficiary should be patient and measured in their response to an executor. For instance, they should learn the legal duties of an executor and their own rights as a beneficiary. They should look for signs of conflict of interest and make a note of anything that is concerning. The most important thing that a beneficiary can do if they don’t trust the executor is engage their own legal representative who can coordinate communication with the executor.
The contested wills team at Armstrong Legal can advise you of your options if you don’t trust the executor of a deceased estate. The team can help you arrange the removal of an executor who is failing to deal appropriately with the administration of an estate. Please contact the team today on 1300 038 223.