Immediately after someone has died can be an emotional time. We understand taking on the solemn responsibility of acting as an Executor can be stressful.
Our Turner Freeman Wills and Estate team are here to provide assistance and guidance in navigating the estate administration process.
We outline some of the general responsibilities and duties of an Executor below.
The main role of an Executor is to represent the deceased person’s interests and finalise all of their personal, financial and legal affairs. If you have recently been appointed as an Executor we hope this information will provide you with a better understanding of what is required to be done.
Legal obligations of an Executor
There is a degree of implied trust when the testator decides who should represent their estate after they have passed. Generally, an Executor will be a family member or close family friend. Whilst an Executor may feel a moral obligation to fulfil the testator’s wishes, they are also legally obliged to act in accordance with the directions and wishes that are recorded in the deceased’s will. Often, Executors also act as Trustees in the estate which includes the legal obligation to act in good faith and in the best interests of any beneficiaries.
Legal Obligations of an Executor and Trustee include:
To act in the best interest of the beneficiaries
An Executor must act in the best interests of the beneficiaries. An Executor cannot be biased or act in their own best interests at the expense of other beneficiaries. Quite often, an appointed Executor is also a beneficiary of the estate. In these instances, it is very important the Executor does not perform their duties in a way that will place themselves in a position of conflict. This can include favouring one beneficiary over another.
To keep estate funds separate and to keep proper records
Executors should ensure that Estate Funds are held separate from their own personal funds. We encourage Executors to keep full and accurate records of how the estate has been managed. Seeking legal advice and assistance in the first instance is the best way to avoid possible claims of maladministration of the estate. The Court may require Executors to provide the estate’s records and accounts, so it is important good records are kept.
To ensure estate assets are protected
It is the responsibility of the executor to ensure that the assets of the estate are protected, and do not diminish, until they are distributed to the beneficiaries. In respect to real property, this may mean securing the property and contents, maintaining insurance policies and organising trades to service the property if required. Likewise, motor vehicles, boats and trailers that form part of the deceased estate should be kept secure and insured. An Executor can be held personally liable for assets that are damaged or lost if the items were not adequately protected.
To maximise the estate
An Executor should seek to obtain the best value for the estate. More than likely, this will include ensuring the assets are not left to deteriorate whilst the Executor is preparing for the estate to be administered. When real property forms part of the estate, some Executors may feel pressured to proceed with a sale that falls well below the market price for the property just to ensure the sale proceeds quickly. This can be influenced by beneficiaries who are requesting their entitlements to be distributed to them without delay. While there are requirements to distribute the estate diligently and without unnecessary delay, it is not unreasonable for distribution to occur within ‘the Executors year’ (12 months). This unwritten rule that is recognised by the Court allows the Executor to obtain valuations of assets and ensure they are sold for fair market value.
An Executor should always be mindful of their obligations to the estate and beneficiaries. We understand this can be difficult in times of grief and coping with the loss of a loved one. If you would like assistance, please do not hesitate to contact our Wills and Estates lawyers on 13 43 63 or via our online enquiry form.