Choosing the right Executor

One of the first things you do when making a will is choose someone to be your executor.

After you die, your executor will be the person responsible for administering your estate.  The main functions of the executor include organizing the funeral, collecting the assets of the estate, paying out the liabilities, defending the estate in any litigation and distributing the estate to the beneficiaries.  The particular role of the executor will vary depending on the estate and nature of the estates.  In some cases, the executor may also act as the trustee of any trusts created in the will.

Choosing the right person to act as the executor of your estate is therefore important.  But what happens if choose the wrong person?

Getting it wrong might mean removal of that person as your executor and the position will be left vacant until the Court, in its discretion, appoints an administrator.  A Court is generally reluctant to not grant probate to an executor chosen by a will maker but will do so if the executor:

  • remains absent from the jurisdiction;
  • refuses to act or administer the estate; or
  • is unfit to act eg bankrupt, a criminal, a minor or someone who has a mental or physical incapacity.

The Court has the power to remove an executor once probate has been granted if the administration of the estate is in jeopardy or there is a risk that the estate will not be administered properly. The decision to remove an executor will depend on the facts and circumstances of the particular case.

An application was recently made to the Supreme Court of Victoria for the  removal of an executor from his duties.[1] The executor was the deceased’s son, who was also a beneficiary of the estate. The will also named the son’s wife and deceased’s half-brother as beneficiaries. The half-brother asked the court to remove the son as executor on the basis that there was a conflict of interest and that the son failed to distribute the estate appropriately.

The estate included a property, bank accounts and  a safe. The estate’s total value was approximately $850,000.00. The conflict between the executor and the half-brother arose because the son was living in the estate property and was treating it as his own instead of leasing the property to generate income for all beneficiaries or selling the property.

The half-brother also alleged that there was cash in the safe and that the cash was not distributed in accordance with the will.  The son argued that there was no cash in the safe and therefore no cash to be distributed to the beneficiaries.

These allegations, as well as the conflict of interest regarding the estate property, were aired in Court during lengthy litigation.

Whilst ultimately the claim made against the executor failed, the case demonstrates the way in which an estate can be involved in costly and lengthy litigation due to disputes between executors and beneficiaries.

When preparing your will and to avoid these types of disputes between executors and beneficiaries the first thing to consider is the appropriateness of the person in mind and some of the questions you should ponder are:

  • Does the person have the time to administer the estate?
  • If your estate is complex, do they have the skills to deal with the issues?
  • Does the person have an interest in the estate and if so, will that put the person in a conflicted position when making estate decisions?
  • Are there current tensions between the person and the beneficiaries of the estate?
  • When choosing more than one person to act, will they be able to work together? How well do they get on?

In some cases, it might be appropriate to:

  • Appoint an independent person to act as executor;
  • Appoint a professional person or trustee company to act as your executor;
  • Appoint more than one of the beneficiaries to act as your executors;
  • Give the executor certain powers and discretions to deal with the assets of the estate.

Preparation and careful selection of the right person for the job will make the process of administering your estate a smoother process for all involved.

[1] Molnar v Butas (NO 3) – [2017] VSC 711

Tiarn Pauletto

Associate, PC Legal

[email protected]