Removal of Executor (NSW)
A testator usually chooses an executor to administrate their deceased estate from close family, friends, or a professional such as a solicitor or the NSW Trustee and Guardian. The testator should select someone suited to the role, as it is a time consuming and, at times, daunting task. The major responsibility of the executor is to faithfully administrate the estate in the best interests of the beneficiaries. Unfortunately, not every executor meets this obligation, and a beneficiary (or fellow executor) needs to file a complaint with the Court to have an executor removed. This article outlines the steps involved in the removal of an executor in New South Wales, with reference to recent case law.
Executor Of Estate
The chosen executor will be responsible for the administration of the estate after the testator passes away. As such, the executor will have to identify and locate the deceased’s assets, pay off debt and protect the estate until the administration is complete. This protection may take the form of storing valuables, taking out insurance on property or defending the estate in court against contest or challenge.
Removal of Executor
Sometimes an executor too hastily agrees to take on the estate administration, and later wants to voluntarily resign their position. Only the Supreme Court can approve the resignation of an executor who has already commenced their duties. In the same hearing, the court will appoint an appropriate administrator to take over the duties of the executor. Alternatively, there is provision in s75A of the Probate and Administration Act 1898 for the executor to file a deed with the court to appoint the NSW Trustee as executor in their place.
Of course, there is also judicial facility for the involuntary removal of an executor. The court is disinclined to remove an executor unless there is sufficient cause, so a beneficiary or fellow executor needs more than vague suspicion or personal dislike. The court will only remove an executor when there is evidence that he or she is unable to faithfully discharge their duties in the best interests of the beneficiaries.
The court might declare an executor unfit if they display misconduct or neglect their duties because of carelessness, incompetence or actual intent. It is cause for concern if the executor:
- Fails to adequately communicate with the beneficiaries;
- Fails to account for the assets of the estate;
- Act in his or her own interests contrary to the interests of other beneficiaries;
- Causes unwarranted delays in the administration of the estate; or
- Causes unreasonable delays in the transfer of assets to the beneficiaries.
In such circumstances, a beneficiary or executor can petition the Supreme Court of New South Wales for an order of compliance or for the removal of the executor.
If the testator appointed several executors and they are not working effectively together, that can be sufficient cause for the removal of one of the executors. In Eastlake v Eastlake , the NSW Supreme Court stated that it deliberately refrained from finding misconduct in the case, because it was sufficient that there was a breakdown in the working relationship between the executors, causing frustration to the administration of the estate.
When the court orders the removal of an executor, it will revoke the grant of probate and issue a new grant to an appropriate administrator. If there is no opposition to the process then the Registrar can deal with the matter in chambers.
In Wise v Barry , the court considered an application for the removal of a co-executor on the grounds that he had significantly delayed the administration of the estate. The duty of the executors in this estate was to sell the assets to pay the debts of the estate. The executor failed for years to vacate a property that was the primary asset, and also moved his wife and her children into the property without permission from his fellow executor.
The court found that it was the defendant’s insistence on remaining in residence that had stalled the administration. The court noted that it had the discretion to remove any executor who causes inexcusable delay, impedes the proper administration of the estate, or refuses to do what is necessary without adequate reason. The reason for the dereliction of duty was immaterial, and it was unnecessary to make a finding of misconduct. The court ordered the removal of the executor and a revocation of the original grant of probate in favour of a grant for the other executor.
If you are a beneficiary or co-executor and feel that an executor is not properly undertaking their duties, contact Armstrong Legal to discuss your legal options. The contested wills team at Armstrong Legal can help you negotiate with an uncooperative executor, or assist you with filing a request with the court for the removal of an executor. Please telephone 1300 038 223 to talk to our team. They can help you hold an executor personally responsible if they behave in a way that causes financial disadvantage.