In a previous blog, “Acting as an Executor for a deceased estate”, we addressed what the Executor of an estate is meant to do as part of their role. It is also important to think about what Executors are not meant to do. Can an Executor simply take everything? What kind of conduct makes an Executor unfit to act? And if an Executor is acting improperly, can a beneficiary remove an Executor from their duties?
In this article, we will explain what the law and the Courts have said about unfit Executors and their removal, and give some hints as to what you can do to avoid issues of Executor misconduct.
Removal of unfit executors due to misconduct
The Administration and Probate Act 1958 (Vic.) gives three scenarios where a Court can remove an Executor after Probate has been granted:
- Where the Executor remains out of Victoria for more than two years;
- Where the Executor wants to be discharged from the role of Executor; or
- Where the Executor refuses or is unfit to act as Executor or is incapable of acting.
What does it mean by ‘unfit to act’?
The Courts have considered a range of misconduct that may constitute unfitness. This includes:
- failure to communicate with beneficiaries;
- failure to properly account for estate spending (including stealing from the estate);
- unreasonable delay in calling in the assets of the estate;
- unreasonable delay in paying beneficiaries their entitlements; and
- conflicts of interest (although this is not necessarily a reason for unfitness).
What may constitute a conflict of interest rather than misconduct?
The Executor of a Will is often also a beneficiary, such as when a husband appoints his wife as his Executor and his main beneficiary of his estate.
While there is an inherent conflict of interest in this situation, it only becomes an issue where the Executor fails to perform their duties properly. Cases before the Court often involve a combination of the above behaviours.
If a beneficiary believes the Executor is unfit to act, they will need to make an application to the Supreme Court to remove the Executor. David Davis & Associates can assist you with this application. You can speak with a lawyer by calling 03 9014 1299.
Prevention is better than a cure – choosing the right Executor(s)
When making your Will, you should think carefully about your choice of Executor. They should be someone that you trust to act appropriately and to manage their duties competently.
If you are concerned that a sole Executor will not be able to deal with all the tasks required, you may consider appointing two (or even more) Executors to act together. In situations where you are appointing your adult children as Executors, this may be useful if you foresee that one child would be unhappy with another’s decisions, or simply if you think that their lives are too busy to handle your Estate alone.
Alternatively, you could consider appointing an independent professional Executor.
A lawyer, accountant or professional trustee company could act as Executor of your Estate for a fee. While this does create added expense for your Estate, a professional also has greater experience in Estate administration and a degree of impartiality.
I am the beneficiary of an Estate and I think the Executor is unfit to act. What should I do?
Your first step should be to contact a solicitor. We can advise you on the duties of the Executor in your particular situation and assist with the next steps.
If possible, it is best to resolve any disputes between you and the Executor outside of Court. This is because Court applications are expensive and time-consuming. Even if you successfully bring an application to remove an Executor, you will still be out of pocket for some costs.
Furthermore, the Court might decide that the Estate should pay the Executor’s legal costs, which may reduce the amount that you are entitled to under the Estate.
We can assist you by negotiating with the Executor’s legal representatives to come to a mutually beneficial outcome without the need for a Court application.
Should negotiations fail, we can assist you with the necessary documentation to make an application to the Supreme Court and support you throughout the process.
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