Who Can Be An Executor?
An executor is responsible for administering a deceased estate, including all of the deceased person’s assets and liabilities. The role can be complex and demanding and may require a significant time commitment, especially if the will is contested or challenged. It is important for a testator to give careful consideration to who is chosen to be an executor of their will. This article outlines who can be an executor in Australia.
An executor must be at least 18 years of age at the time they are appointed to act in the role. They must also be of sound mind and not in prison. Other than these general requirements, anyone can be an executor of a will in Australia. However, because the role of executor can be quite demanding, careful thought should be given as to who is best suited to take on this important role.
It is common for a person to appoint one or more of their close friends or relatives as executors. This results in executors who are familiar with the wishes of the testator, and it also avoids the necessity to pay professional fees. The alternative is to appoint a professional, like a solicitor or accountant, to act as executor. This has the advantage that the executor will be impartial in enacting the wishes of the deceased. In some cases, the practical choice is to appoint one close friend or family member as well as a professional, allowing the professional to complete the paperwork and organise the estate. Whichever approach is adopted, before nominating a person, the testator should ask them if they are able and willing to take on the role.
Can It Be A Beneficiary?
It is common for an executor of a will to also be a beneficiary of the will. For instance, adult children often act as executors for their parents, when they are the principal or sole beneficiary. Similarly, spouses are frequently named as both the main beneficiary and executor of their wife or husband’s will. This can be both convenient and efficient, reducing the number of people who need to be involved in administering an estate.
However, tensions can arise when one beneficiary is an executor of a will and other beneficiaries disagree with either the will’s provisions or the manner of their administration of the estate.
It is important to carefully consider who is positioned best to handle the duties of the role and any conflicts that might result. Being an executor can require diplomacy and good communication skills. If there are likely to be disagreements between beneficiaries, it may be wise to appoint an independent person. This may reduce the chances of the will being challenged or contested, both of which could reduce the value of the estate through protracted legal actions.
Executors have a number of duties. They will apply for the deceased’s death certificate, apply for a grant of Probate, and assist with funeral arrangements. They may also need to notify government departments, such as the Australian Taxation Office and Centrelink, of the testator’s death. They will generally inform banks and finance companies of the death, discharge loans and make urgent payments, and collect from the testator’s insurance and superannuation accounts.
The executor is responsible for protecting the testator’s assets until the will can be administered. This will mean securing premises, compiling an inventory, and obtaining valuations of assets. They might also purchase insurance to protect assets during probate, and/or arrange for the sale of a home.
In the event that the will is challenged or contested, the executor must for defending the estate against legal action and resolving disputes between beneficiaries. They must make a full accounting of their administration of the estate to the beneficiaries.
Only after all of these actions have been taken can the executor distribute the assets to the beneficiaries. Even after the assets are distributed, the executor’s duties may be ongoing if the will gives them tasks such as administering a trust, especially if there are minor children involved.
What If The Nominated Person Is Deceased?
When an individual named as an executor passes away before they can perform their role, a second executor named in the will usually assumes responsibility for administering the estate. If the will does not name a second person, any competent adult can apply to the court to become the administrator of the estate. This person need not be a beneficiary.
Resigning And Removal
It is not easy for a beneficiary to remove an executor just because they are unhappy with their administration of the estate. The courts are reluctant to interfere unless a person is unfit to act in the position, meaning they are incapable of performing the duties of an executor, demonstrate misconduct, or neglect their duty.
Examples of conduct that could lead to a person being removed from the role of executor include excessive delays, failures to communicate with the beneficiaries, or unwillingness to account for the estate’s assets. In determining whether an executor’s conduct is sufficient to have them, the paramount consideration is the protection of a beneficiaries’ interests in the estate.
An executor can resign after they have started acting in the role, but this is a difficult process. The executor must seek approval from the court, make provision for a person to replace them, and have the original grant of probate revoked and replaced.
Fees for acting as executor
A professional acting as executor will typically be paid a fee. This may be a fixed fee or a percentage of the estate.
When a friend or relative is appointed as an executor, the will may make provision for a specific amount or gift in recognition of the time they put into carrying out this role. Even if no provision is made, an executor is entitled to be remunerated for their time and effort, as well as recovering any expenses that are incurred. These costs can be recovered with the agreement of all beneficiaries, or the executor can apply to the court for appropriate compensation.
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