The role of an executor is fiduciary in nature with executors owing duties to the Court and the beneficiaries of the estate. The Courts have both statutory and inherent jurisdiction in respect of the administration of deceased estates and accordingly have an interest in the role of the executor.
Overall the primary concern of the Court is to ensure that the estate will be duly and properly administered according to the terms of the will, with the dominant consideration being the welfare of the beneficiaries. (1)
The choice of executor is extremely important for a testator. When executors do not get along there can be extensive additional costs incurred by the estate, or the individual executors. The costs could involve each executor having their own lawyer, in addition to a lawyer for the estate, and potentially even the costs of an independent administrator.
A properly advised client may be guided to give the requisite level of consideration to the appointment of his, her, or their executor(s). A testator may also wish to provide additional guidance to the chosen executor in an attempt to ensure that the administration of the estate goes as smoothly as possible. The period of administration of an estate can be quite stressful and the executor may often be experiencing grief over the loss of a loved one.
Most executors are family members, or persons who knew the deceased and it is impossible to predict human behaviour. Even with all possible safeguards in place, executors (and beneficiaries) may face issues throughout the administration of an estate and people do not always make fully rational decisions.
Once an executor obtains a grant of Probate, they may face many challenges. There is a reason executor’s commission is said to be compensation for the ‘pains and trouble’ associated with the role.
A properly advised executor will act in a manner befitting the role to ensure the administration is conducted in accordance with the duties owed to the Court and the beneficiaries of the will.
What attributes should the ideal executor have
Those who are appointed may not understand the implications and liability that comes with accepting the role of executor. This role can be extremely challenging and properly informed persons, who are also risk adverse, may wish to avoid acting as an executor for a variety of reasons.
Clearly, the role of the executor can be quite broad and subject to how the will and any ancillary or guidance documents have been prepared – some executors may also have considerable discretion.
The ideal attributes of an executor ultimately depend on the estate to be administered and the terms of the will – including who the beneficiaries are. The testator is often best placed to know the dynamics of their intended beneficiaries but need to be properly advised about the role to make an informed and sensible decision.
Some attributes should be front of mind when a testator is considering whom to appoint as executor, irrespective of the particular circumstances, such as:
- organisational skills;
- financial literacy;
- even-temperament;
- commercially minded; and
- objectiveness.
Appointing family members
While a testator who has multiple children might think it is a great idea to appoint all of their children to act jointly as executors, it is important for the testator to fully understand the implications of this and the potential downfalls. Some states limit the number of executors who can take out a grant to four. (2)
Particularly where there is a blended family scenario or even just multiple ‘factions’ of beneficiaries it may seem prudent to appoint an executor from each ‘faction’ however if those executors will not get along it may just cause stalemates as executors need to act jointly and unanimously, unless otherwise explicitly authorised. Even if some sort of mechanism is included in a will which provides that a majority may decide, this can lead to unwanted ‘ganging up’.
One of the biggest risks with appointing family members and interested persons is that despite having an obligation to the estate (and consequently all beneficiaries) they may intentionally or even inadvertently prefer their own personal interests. This may make it harder for executors to be objective, particularly where they have their own views and prejudices in respect of the other beneficiaries. This can be seen most often where litigation is brought by a person against the estate where there is animosity between the claimant and the executor.
Conclusion
The choosing of an executor may be a fraught decision for the testator. As estates and families become more complicated (including in evolving ways) the choice of executor will become a more important decision.
Prudent executors will take advice from appropriate professional advisors, be they lawyers, accountants, or financial advisors to ensure that their actions are beyond reproach. A properly advised executor may still face ‘pains and trouble’ in the role but may be protected from personal liability and will hopefully avoid any unnecessary hurdles.
When the administration is not conducted correctly, beneficiaries need also be aware of the executor’s obligations so that the executor can be held accountable.
Estate administrations that are not correctly conducted may result in grave consequences for all concerned, not only in respect of time and money but also personal relationships.
1 Re Boglis [2022] VSC 309 at [30] per McMillan J.
2 Queensland, Victoria, Western Australia, and Tasmania.
By Kate Donnan – Senior Associate
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