One of the important things to consider when drafting your Will is who you should appoint as your executor. The executor is the person entrusted with the task of looking after your estate following your death. Their duties include collecting the estate, realising assets, paying out creditors and distributing any surplus to your beneficiaries in accordance with your wishes as expressed in your Will.
Given the personal nature of an executor’s responsibilities and the sensitive time in which they are required to act, it is important to consider the personal as well as practical implications of selecting your executor. Although not required by law, it would be practical and prudent to select an executor who resides in the same State as you to facilitate ease of administration (such as locating your Will; advising various parties you had ongoing dealings with during your lifetime of your passing; closing your accounts with 3rd party service providers and settling any outstanding debts; signing documents for lodgment of documents for probate etc).
Additionally, it is prudent to consider how old your appointed executor will be at the time you anticipate their services will be required. Your executor must be over the age of 18, but it would be impractical to appoint someone who is unlikely to outlive you, or who may be in the early stages of dementia when their services are required. For this reason, it is recommended you appoint a back-up executor in the event that your primary choice of executor is unable or unwilling to act when the time comes.
Considering our aging population with increasingly complex personal, financial and business affairs, you may consider appointing a professional such as a solicitor, or a professional trustee to be your executor.
The advantages of appointing a professional include:
1. Impartiality – other than the obvious advantage of being emotionally removed from the situation, this is particularly important if beneficiaries are not entitled to their gifts immediately. In this situation, the executor’s obligations to the estate continue and they may be required to act in the capacity of a trustee until the gift passes.
Impartiality is also important if a trustee is given any discretion in making distributions (for example in consideration of a beneficiary’s education, health or other needs). Clearly, if one of the beneficiaries was appointed executor and trustee in this situation, the distribution of funds would easily be compromised by their personal interest in the estate.
A professional executor would most likely discharge their duty with constant reference to all beneficiaries, considering their personal circumstances and needs.
2. Professionalism, experience and knowledge – the prospect of applying for a grant of probate and liaising with many third parties following the death of a close friend or family member may be a daunting and burdensome task for some. Negotiating the legalities and red tape to satisfy the requirements of many institutions, (particularly financial ones) can be time consuming and frustrating if it is not undertaken in the right manner. A professional solicitor or trustee executor has the experience and knowledge to undertake these tasks efficiently within the timeframes required by law.
Furthermore, any unanticipated events (such as a claim on the estate by someone left out of your Will, or answering requisitions raised by the Supreme Court prior to granting probate) can also be attended to immediately and directly.
3. Efficiency – as a professional solicitor or trustee would be well aware of the steps required to fully discharge an executor’s duty, the administration of the estate would occur more efficiently. Furthermore, as a solicitor would most likely be appointed to obtain a grant of probate, this solicitor would already have detailed knowledge of the contents of the Will and all the parties and assets involved.
4. Liability – an executor may be sued by one of the beneficiaries for the maladministration of the estate thereby exposing their personal assets such as property and shares to any potential legal action. A professional solicitor or trustee is protected by the cover of their professional indemnity insurance.
It should be noted that an executor is entitled to bring a claim for commission for their work in administering the estate. Likewise, professional executors are entitled to charge for their services if there is a charging clause included in the Will.
Here at The Quinn Group our experienced team of lawyers can assist you in appointing an executor, and also answer any questions you might have in regards to your wills and estates. For more information submit an online enquiry or alternatively you can call us on 1300 QUINNS (784 667) or +61 2 9223 9166 to book an appointment.