Duties of executors and administrators
The responsibilities of a personal representative generally begin with arranging the funeral. Where there is no Legally binding or effective. A document that sets out what a person wants to happen to their money and other property after they die., the responsibilities of the (1) (wills) Someone who takes legal responsibility for the possessions of a person who has died without making a will, or who is still alive but cannot manage their own possessions. For example, an administrator may be appointed to manage the money, house or other possessions of a person who has a severe mental disability. (2) (companies) A manager appointed by the directors of a company that is in financial difficulty. This may give creditors a better chance of getting their money back because the company can keep trading under supervised management instead of being wound up. depend entirely on obtaining the grant of A document that gives a person authority to manage the property of a person who has died without making a valid will that covers all their estate. See also intestate.. Without that grant they have no The right to appear in a court action and be heard. In general, a person cannot bring a case or have their say in a court about something that does not directly affect their interests. They must be able to show that they have sufficient interest in the case because, for example, of possible effects on their property or commercial activities. Also called locus standi. at all and the All the property a person has, including real property and personal property. It is often used to describe property belonging to someone who has died, or the property of a bankrupt. vests in the State Trustees until letters of administration are granted (s 19 Administration and Probate A written law made by parliament. Also called an ‘Act of parliament’, ‘statute’ or legislation. 1958 (Vic) (‘A&P Act’)). Once letters of administration are granted, the administrator’s duties are the same as those of an The person named in a will as the one who must ensure that the deceased person’s intentions, as stated in the will, are carried out. (s 27).
The major duties of the executor begin with the grant of probate, although as will be seen below, they have certain powers before probate is obtained. The beneficiaries have no interest in the deceased property until the executor is in a position to distribute the estate; before this occurs all they have is a right to To take legal action in a civil case. the executor if they fail to administer the estate diligently and correctly. A personal representative (executor or administrator) is not required to distribute the net assets of the estate immediately (s 49 A&P Act) but must make reasonable efforts in all the circumstances to wind up the estate promptly. While there is no rule of law about this, courts usually allow 12 months from the date of death for the estate administration to be completed.
Delay may cause particular problems where the major or sole (1) Someone whose money or property is being looked after for them by someone else (called a trustee). (2) A person who is left something in a will, also sometimes called a legatee. See also trust. is someone (particularly a spouse or domestic partner) with no source of income other than that deriving from the willmaker, or where there is intestacy. (A definition of ‘domestic partner’ is included in ‘Disadvantages of intestacy’, below.) Married couples may maintain a joint bank account that either A person or organisation directly involved in a court case. Parties include the plaintiff or applicant, the defendant, and any third party added to the action, but not independent witnesses. may sign. On the death of either of the account holders, the survivor automatically acquires the right to the entire account and will then have access to money until the estate is finalised.
A Victorian probate duty clearance (or Section 14 Certificate) is not required whether the A person who makes a will. died before or after 1 January 1984 as that duty has been abolished.
A spouse or domestic partner of the deceased should, if left without income, apply for an appropriate social Money or property promised to be handed over as a guarantee for repayment of a loan, or as a guarantee that a defendant will meet their bail conditions. payment (see Chapter 5.1: Dealing with social security).
The major duty of a personal representative is to collect the deceased’s assets and distribute the proceeds of the assets according to the directions in the will or the Found in a statute of delegated legislation. For example, a statutory authority or body is aperson or organisation that has special powers given by parliament to do work for the public benefit. order on intestacy.
The debts of the deceased must also be ascertained and paid before any distribution is made; these include income tax debts. Funeral and testamentary expenses must be paid in priority to all other debts of the deceased.
An executor should advertise in the form of schedule 2 of the Trustee Act 1958 (Vic) (‘Trustee Act’) for claims against the estate to be made to them within two months of the advertisement (see s 33 sch 2 Trustee Act); and see ‘Time for payment of debts’, below).
The representative must keep detailed accounts and records of the administration of the estate (s 28 A&P Act). The The officer in charge of the administrative section of a court, which is known as the registry. See also prothonotary. of probates has the power to have executors file accounts with the An independent body that hears legal claims brought by parties and decides between them. Serious cases are heard by a judge and jury, or just a judge. Less-serious cases are heard by a magistrate. in the form stipulated in the administration and probate rules. A beneficiary has the right to inspect and copy any documents or accounts relevant to that person’s interest in the estate.
Powers of the executor
The executor has the choice of paying funeral expenses at an early date if funds permit. Banks will often advance funds to pay funeral The amount charged by a lawyer for legal work. Lawyers can only charge the amount agreed with the client in a costs agreement or the amount stated by a court in its rules. The party who loses a case usually has to pay all their own costs plus most of the costs reasonably incurred by the other side. See also indemnity costs. without the need to produce probate. If possible, they can also make payments to creditors to avoid additional interest charges (e.g. payment of rates on a property) while awaiting the grant of probate. To protect the estate, before probate is obtained, the executor is allowed to A document signed by parties ending a court action. The party who began the action agrees to drop it, often in exchange for a payment by the other party. Also called terms of settlement. and pay debts, receive money owing to the deceased and take (1) Having control over property. Possession is not the same as ownership. For example, a bicycle you have borrowed from a friend is in your possession but you do not own it. (2) Having illegal drugs on your person or property. of land (but not sell it), provided in all cases they will eventually be able to satisfy the court of that power. The title is only made certain and final by the grant of probate.
Problems with the executor
Problems may arise with the administration of an estate. Some of these are discussed below.
No executor appointed
When there is no executor appointed in the will, or the executor has died or is divorced from the willmaker, the court usually grants the administration of the estate to the beneficiary with the greatest interest in the estate. This administrator then carries out the wishes of the deceased as expressed in the will. This procedure is called ‘letters of administration with the will annexed’.
Executor does not wish to act
A person appointed by the willmaker as executor does not have to accept this responsibility. If a person renounces appointment under the will (i.e. refuses to act), another executor named in the will may assume the role if the wording of the will allows this. If there is no other executor named in the will it will be treated in the same fashion as the will with no executor appointed discussed above, and letters of administration with the will annexed will be granted.
Executor is dead
Where a sole executor dies before the willmaker or before any steps have been taken to prove the will, letters of administration with the will annexed are granted. Where the last executor to obtain probate dies, the executor of that dead executor also becomes the executor for the deceased (s 17 A&P Act). To avoid these unsatisfactory situations it is advisable to appoint more than one executor. Otherwise wills should be changed on the death of someone nominated as executor.
Executor is a In Victoria, a child or young person under 18. See also infant.
Where the sole executor is under 18 years of age, the court can appoint the minor’s Someone who is legally responsible for taking care of another person or their property., or such other person as the court thinks fit, as executor until the minor reaches 18 (s 26 A&P Act).
Normally a person is appointed as both executor and trustee. However, these are two different jobs. The executor’s role comes to an end when they have realised the assets of the estate, paid any debts and is then ready to distribute the balance of the estate to the beneficiaries. Where the terms of the will create a continuing duty, such as the support and Money paid to a person to financially support them. When a couple has separated both parents have a duty to support their children, and a court can order a parent to make regular payments to support the children. Maintenance for a spouse is now less common, and must be applied for within 12 months of a divorce. It is usually covered in a final settlement of all property. of young children, this role is performed as trustee.