Collecting and Managing Estate Assets

Once probate has been granted, executors can begin to secure and collect all estate assets, including bank accounts, shares, real estate, and personal property. 

The executor will be required to prove their authority to deal with the assets by providing a certified copy of probate and certified identification to the asset holder. 

Managing estate assets after probate can be complex and burdensome, and most executors engage an estate lawyer to assist with the process. 

Accessing Bank Accounts and Financial Assets

Accessing funds will depend on how the account is held and the value of the account. 

While bank accounts held jointly will pass to the surviving account holder without the need for probate, access to accounts held solely by the deceased will depend on the specific bank’s policy. 

In some cases, where the amount of money is small, the bank may release the funds to the named executor without a grant of probate. Where larger amounts are held, the bank is likely to require a grant of probate. 

Other assets, such as shareholdings, will either be sold or require transmission to the relevant beneficiaries.

Transferring Ownership of Real Estate and Property

The method in which a property is held will determine how the property is transferred. 

Title to property held as Joint Tenants will pass to the surviving Joint Tenant upon the lodgement of a Death Notice with the NSW Land and Registry Services. 

Title to property held solely or as Tenants in Common will usually be subject to two transfers, firstly, from the deceased to the executor, and secondly, from the executor to the beneficiaries who are entitled to the property under the terms of the will, unless sold by the executor beforehand. 

The executor’s solicitor is usually responsible for transferring the title of the property after probate. 

Settling the Estate’s Debts and Obligations

Executor duties also include paying the deceased’s liabilities and any estate or testamentary liabilities such as credit cards, utilities, funeral and burial expenses, probate application fees, legal costs, and tax liabilities. 

If the debts and liabilities exceed the estate assets, the estate may need to be administered under the insolvent estate provisions. 

The executor will usually hold off paying debts until after probate has been granted, to ensure they receive the protections under the relevant legislation. 

Paying Outstanding Bills and Liabilities

The executor is responsible for identifying and paying all debts and liabilities from the estate assets. 

The executor may become aware of debts and liabilities from the deceased’s personal records or from family and friends. 

Alternatively, other creditors may learn of the deceased’s death and make a claim on the estate upon becoming aware of notices published by the executor, known as a “Notice of Intention to Apply for Probate” and a “Notice of Intention to Distribute the Estate”. In NSW, these notices are published on the Supreme Court website by the executor or their lawyer and give the public notice of the deceased’s death and the executor’s intention to apply for probate and notice of the executor’s intention to distribute the estate. These notices will contain the contact details of the executor or their lawyer whom creditors can contact if they assert a debt against the estate. 

The executor has an obligation to notify and settle all known creditors before distributing the estate assets to beneficiaries. 

The executor pays estate debts from estate funds or if there is insufficient funds, they may be required to sell property to pay the debts. 

Lodging the Final Tax Return for the Deceased

The executor is responsible for preparing and lodging the deceased’s final tax return, known as a “date of death” return, with the ATO. Any tax liability is payable from the estate. 

The executor is also responsible for preparing and lodging a tax return on behalf of the estate if the estate earned income during the administration process. For instance, if one of the deceased’s properties was rented out and earned income, or if the executor was required to sell property that gave rise to capital gains tax, the tax liability is also payable from the estate. 

The executor usually instructs their solicitor to engage an accountant to complete the final tax return for the deceased and the estate tax return. 

Distributing the Estate to Beneficiaries

Once all debts are paid, the executor can proceed with distributing the estate in accordance with the will. 

In some cases, the executor may allow one or more interim distributions to be made to beneficiaries during the administration. This usually only occurs where the size and nature of the estate allows for interim distributions. 

If an interim distribution has been made, the executor will make a final distribution that brings to account the interim distribution(s), and any other adjustments. The executor would be wise to obtain releases from beneficiaries prior to making the final distribution. 

The executor will usually only commence distributing the estate after probate to ensure they enjoy the protections against personal liability found in the legislation, which only apply if certain steps are satisfied. 

Following the Will’s Instructions

Executors must distribute the estate in accordance with the terms of the will, unless they don’t have to for other reasons, such as where an agreement is entered to distribute the estate in some other manner. 

In NSW, if the will is unclear, the executor can attempt to negotiate an agreed interpretation with the beneficiaries or may approach the Supreme Court of NSW for advice on interpretation.  

An executor must ensure they are carrying out the will’s instructions, unless they have an agreement or court order providing otherwise. 

Resolving Beneficiary Disputes or Claims

An executor is also responsible for defending claims against the estate. 

In NSW, one common claim is a family provision claim under the Succession Act 2006 (NSW) where a person brings a claim against the estate for provision or further provision. In these cases, the executor has an obligation to uphold the terms of the will and has power to negotiate and/or defend the claim on behalf of the estate. The executor would usually be wise to seek the views of the beneficiaries who may be impacted by the claim. The executor may be required to attend mediation for the purposes of resolving claims against the estate. If an agreement can be reached, the parties may formalise the agreement in a Deed of Family Arrangement or similar agreement. 

Closing the Estate and Completing Record-Keeping

Once all assets have been collected, all debts have been paid, and the estate has been distributed, the estate administration process comes to an end.

At the conclusion of the administration, the executor may need to notify government agencies such as Centrelink. 

The executor’s legal obligations end after finalising the deceased’s estate, however, the executor will remain liable for their conduct during the estate administration process. 

Can Probate Be Challenged After It’s Granted?

Where an executor applies for probate – and the application is non-contentious – the court will issue a grant of probate in “common form”. Most grants of probate are grants in “common form”. 

A grant of probate in “common form” can be challenged. 

If a person believes the deceased’s last will is not valid, they may consider challenging it. Common grounds upon which a will may be challenged include (a) where the will was executed by someone who lacked testamentary capacity, (b) where the will itself was a product of undue influence, or (c) where the will was the product of fraud. 

Contested Probate proceedings

If a person wants to challenge a will, they can do so by seeking a grant of probate in “solemn form”. These proceedings are referred to as “solemn form proceedings” or “contested probate proceedings”. These proceedings result in the court considering the evidence and deciding whether the last will is valid. If the last will is found to be not valid, the court may grant probate for the penultimate will. 

If the executor has only obtained probate in “common form”, an interested person can seek probate in “solemn form” at any time in the future; however, if the assets have already been distributed from the estate, it may be difficult or impossible to recover those assets. 

If you believe a will is not valid and want to challenge probate in NSW or dispute a probate grant, you should contact a lawyer immediately. 

Seeking Legal Assistance After Probate Is Granted in NSW? Contact Us Today

If you have been named executor and would like to apply for probate, or would like legal help after probate, call Empower Wills and Estate Lawyers today on 1300 414 844 for assistance. 

Empower Wills and Estate Lawyers are experienced in probate administration and can help avoid errors to minimise any personal liability an executor may have, including defending claims against the estate. Call or message us today for executor legal advice. 

If you believe the last will is not valid or the will is unfair, call us now to discuss your options with an estate lawyer in NSW. 

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Disclaimer: the information in this article relates to NSW law as at the date it was written and is general information only. It does not constitute legal advice and should not be relied upon as legal advice. It may contain information or links to sources which are no longer current. If you have a question or legal issue, we recommend you contact a lawyer and obtain legal advice that takes into account your specific facts, circumstances, needs and objectives.