Choosing the right executor isn’t necessarily difficult, but in this blog we’ve put together some tips to make it easier.
An executor is a person appointed under a Will to administer the willmaker’s estate. The willmaker’s appointment is ratified by a grant of probate from the Supreme Court. The grant of probate gives the executor power to deal with the assets and liabilities of the deceased estate.
The general duties of an executor range from organising the funeral, collecting the assets of the deceased’s estate, paying all liabilities and debts of the deceased and distributing the balance to the beneficiaries set out under the deceased’s Will. The executor has 12 months to do this but more complex estates can take longer. The executor’s role finishes when all the liabilities have been paid and the balance distributed to all of the beneficiaries in accordance with the Will. The executor’s role can sometimes change to a “trustee” where they are required to hold assets on trust for a beneficiary, especially a young or disabled beneficiary.
Here are some elements to consider:
1. Fundamentally, the role is a position of trust.
2. The willmaker should weigh up the personal circumstances of persons he or she may appoint. For example:
Age – it may not always be prudent to appoint someone older than the willmaker or near retirement, particularly if an alternate is not appointed.
Location – the role will require documents to be signed (sometimes in the presence of an authorised witness like a solicitor of justice of the peace) and decisions to be made. It can be made more difficult where an executor resides outside of Australia or, in fact, outside the area where the deceased’s physical assets are mainly located.
Health – the role can have its demands, especially if there is a dispute, claim or assets that require constant ongoing attention.
Time – the more complex estates can be extremely time consuming at times, although appointment of more than one executor can ameliorate this.
3. It is not uncommon for willmakers to appoint more than one executor who bring different skillsets and more than one point of view to the table. They can also “share the load”. For example:
It can sometimes be an arduous task investigating the assets and liabilities of the deceased, so it can be cost-efficient and advantageous to appoint someone who has some knowledge of those assets and liabilities.
Most executors will seek the assistance of a legal professional in applying for a grant of probate and administering the deceased estate. Whilst a legal professional is a valuable and active tour guide to walk executors through the legal process, it helps if an executor has a “business-like” attitude that respects the formalities of the process, such as completing tasks in a timely and efficient manner and preparing and completing tax returns.
Appointing someone independent can have its benefits. Whilst they may have a useful skillset, they may also act as a “buffer” between family members also acting as executors, and the beneficiaries.
The relationship of the executors can often be overlooked. It is important to consider whether they have the capacity to work together and equally, to resolve disagreements.
More complex estates or situations may warrant more people at the table, whilst more simple estates may be adequately administered with only one executor.
4. The role may involve some difficult decisions. Willmaker’s may balance up considerations such as whether a potential executor is easily influenced by another and/or is prepared to act and “stand up and be counted” under difficult circumstances.
5. If a willmaker foresees that his or her estate may be contested, it may be appropriate to appoint an executor with a certain amount of resilience and readiness towards defending the Will in court.
6. Whilst there is no requirement for a willmaker to compensate an executor for performing the role, a willmaker may leave a cash legacy to an executor in lieu of performance (particularly, if they are not otherwise a beneficiary). A willmaker may also empower a professional executor to charge for his or her professional services.
Any executor may also apply to the Court for a commission for their “pains and trouble” of performing the role. In awarding a rate of commission, the Court looks at a number of factors but the higher rates are generally awarded to more complex estates.
For more information or particular advice on choosing the right executor, please do not hesitate to contact our Wills and Estates team.
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