Your Role as the Executor of a Will in NSW
What Is Your Role as an Executor of a Will in NSW?
An executor’s role is to carry out the wishes of the deceased by administering and distributing the estate in accordance with the terms of the deceased’s will.
An executor obtains the power to administer an estate through a grant of probate. A grant of probate is a document issued by the Supreme Court.
Executors must be willing and able to act in the role and must be over 18 years of age. They are usually trusted family members or friends who are younger than the will-maker and likely to outlive the will-maker.
An executor’s role may include:
- Identifying and locating the deceased’s last will.
- Organising the funeral.
- Arranging for the burial or cremation of the body.
- Obtaining legal advice on administering an estate.
- Obtaining other documents (i.e., death certificate, bank account records).
- Identifying the estate assets and liabilities.
- Insure assets.
- Applying for a grant of probate.
- Resolving any disputes in the probate court or defend any inheritance claims.
- Lodging tax returns for the deceased and/or the deceased’s estate.
- Paying estate liabilities.
- Administration of the estate once probate has been granted.
- Distributing the assets to the beneficiaries according to the will in a reasonable time.
- Finalising administration of the estate.
A probate lawyer will be able to assist with the steps outlined above.
The Legal Appointment: How Can A Person Appoint An Executor in a Will?
An executor is the person who is named as executor in a deceased person’s will.
It is usually wise to let the proposed executor know that you are considering naming them as executor prior to signing your will. As the executor will have the responsibility to administer an estate, some people do not want to act as someone’s executor. Letting the proposed executor know that you are considering naming them as executor before you pass away will give them an opportunity to express any concerns or hesitations they may have before the will is signed and allow you to identify and name other executors if needed.
Once you have executed your will, it is often useful to let the executor know the details of your solicitor (if any), provide them with a photocopy of the executed will, and let them know where your important personal documents are stored.
If a person has no valid will, this means there is no executor, and the person is taken to have die ‘intestate’. Where a person dies intestate, a court order may be required to appoint an administrator to administer the estate. This involves another person (usually the deceased’s next of kin or the beneficiary with the largest interest in the estate) applying for letters of administration. If successful, the court will appoint an administrator to administer the estate and distribute the estate in accordance with the rules of intestacy.
Executor vs. Trustee: What’s the Difference?
Whilst an executor’s power to deal with the estate assets derives from the grant or probate, the person named as executor is responsible for several matters from the date of death, including arranging the funeral and arranging disposal of the deceased’s body, though in reality, the deceased’s family will usually organise the funeral and disposal of the body. Once probate is granted, the executor will be responsible for administering and distributing the estate.
The trustee, on the other hand, is the person responsible for administering any trusts that arise under the will. The trustee’s duty begins once the executor has discharged their duties, at which stage, the trustee assumes responsibility for managing the trust assets in accordance with any express or implied terms of the trust. The power of both the executor and the trustee may include the need to sell assets and investing surplus funds.
Protecting Beneficiary Interests: The Executor’s Fiduciary Duty
The executor must act in the best interests of the beneficiaries – this is referred to as a ‘fiduciary duty’.
An executor may be held liable for any conduct in breach of the fiduciary duty and therefore, must make decisions in the best interests of the beneficiaries. An executor may be personally liable for any losses suffered by the beneficiaries.
After Debts Have Been Paid: Distributing Assets to Beneficiaries
The executor of the estate is responsible for paying the liabilities of the estate, including any debts to the Australian Taxation Office (i.e., income tax and capital gains tax) that result from the lodgement of the deceased’s final tax return and the estate’s tax return.
Once the estate’s debts are paid, the executor may distribute the personal effects (which may include clothes, personal possessions, jewellery etc) and distribute the remaining assets according to the terms of the will.
A probate lawyer can help with the administration and distribution of an estate.
Executor Challenges: Dealing with Disputes and Complications
A lot can happen during the administration of an estate. For instance, an executor may find themselves in a situation where they have to defend the estate against a dispute or claim.
It is the executor’s role to defend a will against a claim, regardless of whether the claim is well-founded or frivolous.
For instance, a person may challenge the validity of the will on grounds including undue influence, suspicious circumstances, or a lack of testamentary capacity, or a person may challenge the fairness of the will by bringing a family provision claim against the estate.
Once a person notifies the executor of their intention to bring a claim, the executor should seek legal advice from a probate lawyer experienced in defending claims.
Renouncing The Role of Executor of an Estate
An executor may wish to renounce their role, and this may be done formally by completing a Renunciation of Probate Form, which may then be filed with any later application for probate or administration by any other person.
Reasons why people may renounce the role of executor include concerns regarding the demands (both time and emotional) of the role or because the named executor has grown distant from the deceased and no longer feels obliged to perform the role.
Crucially, an executor can only freely renounce the role if they have not ‘intermeddled’ in the estate, for instance, sold assets or paid debts. An executor who has intermeddled with the estate will usually require court approval to renounce the role.
If an executor is found to be unable or unwilling to act before probate has been granted, another named executor may apply for probate. Where there is a valid will but none of the named executors are willing or able to act, another person (usually the next of kin or beneficiary with the largest interest in the deceased estate) may apply for a grant of administration, which will permit them to administer the estate. This is referred to as an application for ‘Letters of Administration with the Will annexed’.
Public Trustee: An Alternative If No One Willing of Able to Act as Executor or Administrator
If there is nobody willing or able to act as executor, the Public Trustee is an alternative solution across states such as New South Wales, Queensland, Victoria, and others. It is the colloquial name for the state body available to members of the public who do not want to appoint someone to administer their estate or do not know anyone suitable for the role.
The Public Trustee charges a fee, and the fee is usually calculated based on the value of the estate and the nature of the assets of the estate. Therefore, the more valuable the estate the higher the fee. The Public Trustee should not be confused with legal aid in each state.
In Conclusion: The Vital Role of an Executor in NSW
An executor is responsible for administering a deceased estate. They are responsible for making sure beneficiaries receive their entitlement to an estate in accordance with the deceased’s wishes. It is a complicated and important duty that should not be undertaken lightly.
If you have been appointed executor of a will and have any questions or concerns, you should speak with the will-maker or obtain independent legal advice.
Need Help Navigating Your Role as an Executor? Contact Our Legal Team Today!
If you have been named as executor and are seeking advice or assistance, call Empower Wills & Estate Lawyers on 1300 414 844. We can help you with the process and ensure you fulfil all legal responsibilities.
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.