Executor Giving Away Property (Qld)
When an executor takes on the administration of a deceased estate, they are entrusted with safeguarding the deceased’s property until it can be distributed according to the testator’s wishes. An executor should only be giving away property with the permission of the testator, the court or the beneficiaries of a will. This article examines the consequences of an executor giving away property in Queensland.
Executor Control Over Property
Once the Supreme Court of Queensland issues a Probate Grant, the executor is vested with the property of the deceased estate. As such, under the rules of the Succession Act 1981, the executor has legal, and often physical possession of these assets, but only for the purpose of holding them safe until they are passed to the appropriate beneficiary. In such a circumstance, an executor may be confused as to their degree of control over estate assets and may start giving away property unilaterally.
The executor is charged with protecting the property in a deceased estate, with a view to preserving and realising the true value of the assets. To this end, an executor must ensure that the property stays in much the same condition until it is transferred to the beneficiary. For instance, if a testator leaves a car to her son, he should receive the vehicle with nearly identical mileage, save any mileage incurred in necessary maintenance or transport of the vehicle.
Assets And Liabilities
One of the first things that an executor must do is compile a list of the deceased’s assets and liabilities. The list should be as detailed as possible, including identifying features of any small valuable items. This list protects the executor from any accusation of impropriety, but by the same token, it will reveal whether the executor has acted inappropriately in selling, keeping or giving away property. The executor should arrange appraisals and valuations of property so that they (and the beneficiaries) can decide whether an item of property is worth preserving.
When the executor is giving away property, it must be as the testator wished, or in line with the legislative guidelines. Otherwise, the executor can only act with the agreement of the beneficiaries themselves. The court is likely to remove an executor for misconduct if they act in contravention of this rule.
Executor Giving Away Property Through Misunderstanding
An executor needs to completely understand the terms of the will before giving away any property. A well-drafted will should be understandable even to a non-professional executor, but sometimes (particularly with self-drafted wills), it is easy to misunderstand the testator’s intention. As such, it is always advisable to contact a solicitor for advice if there is any ambiguity in the wording of the will. It may even be necessary to ask the court to make a judgment as to the testator’s intent. The executor needs to remember that they can be held personally liable for giving away property to the wrong beneficiary.
The executor is only responsible for the assets of the estate until they are transferred to the beneficiaries. Typically this is completed as soon as possible, but there are instances when the executor maintains control over estate property for years, such as when they are held in a testamentary trust.
Executor Giving Away Property Through Special Bequest
A testator will sometimes divide personal possessions, such as artwork and jewellery, amongst beneficiaries through special bequests. Therefore, when an executor is charged with clearing out the deceased’s residence, some of the household items may be designated bequests. These items must be safely held until they are transferred to the new owner. The residual legatee will inherit any remaining residue estate, so the executor should consult them first before selling or giving away the remaining personal property.
In fact, one of the common duties of executorship is to arrange for the disposal of any rubbish or valueless property in the home of the deceased. It can be difficult for an executor to assess if an item of property in the deceased estate is valueless, and thus may be donated or discarded. If the executor makes the wrong decision and disposes of an item with a monetary value, they may incur liability for mismanaging the assets of the estate. While an executor would theoretically have to ask to discard everything from household rubbish to unsaleable furniture, the executor is unlikely to be sanctioned for applying common sense to such decisions.
It can be difficult to understand the limits of an executor’s power over property. The team at Armstrong Legal can provide guidance if you are worried that an executor is giving away property. Please contact us or telephone 1300 038 223 for legal advice on an executor’s responsibility, and specific legal advice on whether the situation calls for the removal and replacement of an executor.