Administering an estate – duties of executors and administrators
An executor is the person or persons appointed under a Will to deal with a deceased person’s affairs after he or she dies. This entails responsibility for the practical matters required immediately after a person’s death and the entire administration of the estate including locating the Will, identifying and protecting assets, applying for a grant of Probate, identifying and locating beneficiaries, filing estate tax returns and distributing assets according to the Will.
An administrator has a similar role, however, is appointed by the Court through Letters of Administration when a person dies intestate (without a Will) or the person appointed under the Will is unable to act as executor.
Executors and administrators have significant legal responsibilities and should ensure they are protected from potential liability for improper administration of the estate or in the event of a claim against the estate. During the administration process, they may deal with accountants, financial institutions, real estate agents and brokers and are advised to carry out their role under the guidance of an estate lawyer.
Executors and administrators often need to consider matters outside their area of expertise, such as the tax implications on the sale or transfer of assets or the order of payment of debts (particularly in the case of an insolvent estate). They may need to deal with grieving family members, frustrated beneficiaries and may face arguments, disputes and potential family provision claims. For these reasons, obtaining professional advice and guidance is essential.
What is Probate?
A grant of Probate ‘proves’ the last Will of the deceased and authorises the executor to deal with the estate assets. The requirement to obtain probate usually depends on the size of the estate, the nature of estate assets, and the particular circumstances of each case.
To obtain a grant of Probate, the executor named in the Will applies to the Supreme Court by filing the relevant application and supporting documents such as a statement of assets and liabilities, the Will and Death Certificate. The executor must provide an undertaking to deal with the estate as required by law. A Probate application is usually prepared by an estate lawyer who can also assist the executor with any anomalies or requisitions raised by the Court.
Once Probate is granted, the estate assets vest in the executor and he or she may deal with the assets and commence administering the estate in accordance with the Will. Similarly, a grant of Letters of Administration will allow the administrator to deal with the assets in the same manner as an executor.
Family provision claims – challenging an estate
Family provision laws have evolved to reflect ‘community standards’ by ensuring those who should morally be provided for receive an adequate inheritance from a family member. Only eligible persons may make a family provision claim seeking a share or greater share from an estate. Typically, an eligible person includes spouses or former spouses or partners, a deceased’s child or grandchild (of any age) and, in some circumstances, persons who were financially dependent on the deceased.
Strict timeframes apply for making a family provision claim and the applicant must be able to show that the deceased failed to make adequate provision for his or her proper maintenance, education and advancement in life. When considering such claims, a Court will look at a range of factors including the size of the estate, the competing interests and needs of other beneficiaries under the Will or other eligible claimants and the nature of the relationship between the applicant and deceased.
A family provision claim may well be justified and arise because of errors or omissions in a Will, the failure of a testator to update a Will or a range of other circumstances. Conversely, some claims are vexatious and fiercely contested causing grief and anxiety to the deceased’s family. Most claims settle out of Court through negotiation or mediation between the parties’ legal representatives.
An executor may be required to defend a family provision claim and in doing so has a duty to uphold the provisions of a Will but must also ensure that estate assets are preserved and not unnecessarily depleted.
Challenging a Will
Other estate disputes concern questions over the validity of a Will due to claims of undue influence, allegations of fraud or forgery or that the deceased lacked the necessary legal capacity to make the Will. The interpretation of ambiguous terms in a Will, mistakes, or a challenge regarding the appointment of an executor or administrator may also arise.
Estate administration and litigation can involve complex legal issues – these matters can be contentious, causing stress and uncertainty as executors, administrators and family members struggle to cope with grief while defending their legal rights or the wishes of the deceased.